Terms and Conditions of a Sale - Johanson Technology

1.

TERMS OF AGREEMENT. The specifications on the face hereof together with the following terms and conditions,constitute the entire Agreement between Seller and Buyer. The terms and provisions of this acknowledgment shall be controlling. An objection to any term herein, including provisions which are in addition to or different from those contained in the Buyer's forms, must be in writing and shall not be deemed timely unless received by seller within seven (7) days from the date of the mailing of this Agreement. If Buyer makes timely objection to any term herein, Seller shall have the right to withdraw its acceptance and this acknowledgment Buyer's to object as specified will be deemed conclusive acceptance of all the terms and conditionsof this acknowledgment. No acceptance by the Seller of any order shall be deemed to be an acceptance of any provision of the Buyer's Purchase Order form. No Purchase order or written or oral agreement will modify this order, including these terms and conditions, unless specifically agreed to in writing, by Seller. The invalidity of any provision of this agreement will not affect the validity of any other provision.

2.

PRICES AND TERMS. Price terms and availability of merchandise are subject to change without notice, including but not limited to changes caused by the fluctuation in market price, availability or quality of precious metals employed in the manufacture of the goods described herein Unless otherwise provided on the face hereof, payment hereunder shall be due net thirty (30) days from the date of shipment. All amounts past due shall bear interest at the rate of 1.5% per month or at the maximum rate allowable by California law. Seller's obligation to produce or deliver hereunder is conditioned upon continued good credit of Buyer and upon Buyer's payment when due of any sum owing by Buyer to Seller under any agreement between the parties. Based on Seller's reasonable judgement, if Buyer's financial condition at the time the merchandise is ready for shipment does not justify the terms specified the Seller reserves the right to change these terms, to require full or partial payment in advance, or to ship the goods C.O.D.

3.

TAXES. Any taxes which Seller may be required to pay or collect under any existing or future law, upon or with respect to the sale, purchase, delivery, storage, processing, use or consumption of any of the material covered hereby, including taxes upon or measured by the receipts from the sale thereof, shall be for the account of Buyer, who shall promptly pay the amount thereof to Seller upon demand.

4.

SHIPMENTS. Shipment dates are based upon Seller's best judgement and are subject to factory schedules and production limitations, and hence are not guaranteed.

5.

DELIVERY IN INSTALLMENTS. Seller reserves the right to make delivery in installments unless otherwise expressly stipulated herein. All such installments shall be separately invoiced and paid for when due, without regard to subsequent deliveries. Delay in delivery of any installment shall not relieve Buyer of its obligation to accept remaining deliveries.

6.

DELAY. Seller shall not be liable for delays in performance caused by act of God, fire or other casualty, accident, strike, shortage of labor or materials, governmental action or other cause beyond Seller's reasonable control and the time for Seller's performance shall be extended by the period of any such delay. Seller reserves the right to apportion its production among its customers as it may determine.

7.

SPECIALLY MANUFACTURED GOODS. On any order of specially manufactured good, an overrun or underrun of 5% of the quantities specified shall be considered fulfillment of such order Buyer shall pay in accordance with the units shipped.

8.

LIMITED WARRANTY. EXCEPT AS PROVIDED HEREIN, SELLER EXPRESSLY EXCLUDES ALL WARRANTIES, EXPRESS OR IMPLIED, INCLUDING WARRNATIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE.

Seller makes no warranty as to the design, capabilities, capacity or suitability of the goods, except that for a period of ninety (90) calendar days from the date of shipment of the goods to Buyer, Seller warrants Buyer that the goods shall be free from defects in material and workmanship during normal use and service.

Seller warrants only that the goods will conform to the applicable specifications therefor listed in Seller's catalogs and/or other applicable sales material: provided, however, that (if) between the date of shipment and date of first use, the goods are stored and maintained in "as shipped" condition. (if) the goods have been installed, used and maintained according to Seller's instructions and guidelines, if any, and (if) no modification to the goods has been made after shipment without written authorization from Seller.

It is expressly understood that any technical or other advice furnished by Seller or its agents with reference to the use of the goods is done on a gratis basis, and Seller assumes no obligation or liability for the advice given or the results obtained, all such advice being given and accepted at Buyer's sole risk.

No agent, employee, or representative of the Seller has any authority to bind Seller to any affirmation, representation or warranty concerning the goods unless set forth in writing in this agreement and unless an affirmation, representation or warranty made by agent, employee or representative is specifically included within this agreement, it is not deemed a part of the basis of this bargain and shall not in any way be enforceable.

The remedies for non-conforming goods provided in this Agreement shall be the exclusive and sole remedies of Buyer therefor, any right of Buyer to consequential or incidental damages is expressly excluded Specifically, but not by way of limitation, in no events shall Seller be liable to Buyer or to any other person, firm, association or corporation for loss of profits, loss or damages of any kind based upon a claim for breach of the warranty stated herein.

Buyer agrees to assume any liability for infringement of patent, copyright, or any other property right (whether common law or statutory) arising out of the manufacture of the goods and saves Seller harmless from and against any and all costs and expenses (including, without limitation attorneys fees and court costs) arising out of or in conjunction with such actual or alleged infringement except in such cases where said goods were produced under Seller's own patents: provided, however, that Seller does not warrant against infringement of its own patents by reason of the use of same in combination with other materials or in the operation of any other process.

Buyers hereby indemnifies and saves Seller harmless from and against any and all other claims, liabilities and actions by third parties, including (without limitation) customer of Buyer, relating to the goods.

Buyer assumes all risk and liability for results obtained in use of the goods, whether singly or in combination with other products.

9.

INSPECTION. Prior to shipment, Buyer shall have the right and shall be given the opportunity to inspect the goods at the Seller's place of manufacture. Such inspection shall be so conducted as not to interfere unreasonably with the Seller's operations and consequent approval or rejection shall be made before shipment of the material Notwithstanding the foregoing, if, upon receipts of such material by Buyer, the same shall appear not to conform to the contract between Buyer and Seller, Buyer shall notify Seller in writing within thirty-five (35) days from date of shipment of the goods of such condition. Failure to give notice within the time specified shall constitute an irrevocable acceptance of the goods. No claims, of any kind, by Buyer shall be valid without notice, as specified. Buyer shall afford Seller a reasonable opportunity to inspect the material and repair or replace any materials determined by Seller to be non-conforming. No material shall be returned without Seller's consent.

10.

REMEDY FOR NON-CONFORMING GOODS. If the material furnished to Buyer shall fail to conform to the contract or to any express or implied warranty as stated herein, Seller, at his discretion, shall, within thirty (30) days of notice of said non-conformity, issue credit for or shall replace such non-conforming material at the original point of delivery and shall furnish instructions for the disposition of the non-conforming material. Any transportation charges involved in such disposition shall be for Seller's account. Buyer's exclusive and sole remedy on account of or in respect to the furnishing of material that does not conform to this contract, or to any expresser implies warranty, shall be to secure credit or replacement thereof as aforesaid. Seller shall not, in any event, be liable for the cost of any labor expended on any such material or for any special, direct, indirect, incidental or consequential damages to anyone by reason of the fact that such material does not conform to this contract, or to any express or implies warranty herein. No claims of any kind will be considered on materials which have been converted, changed, processed or used in manufacture.

11.

PERMISSIBLE/VARIATIONS, STANDARDS AND TOLERANCES. Except in the particulars specified by Buyer and expressly agreed to in writing by Seller, products ordered shall be produced in accordance with Seller's standard practices. All products, however, shall be produced subject to Seller's tolerances and variations in respect to dimension, weight, surface conditions, composition, mechanical properties, internal conditions and quantity; to deviations from tolerances, and variations consistent with practical testing and inspection methods; and to regular practice on over-and under-shipments. All representations and certifications on the part of Seller with reference to such products shall be limited by the foregoing.

12.

SPECIFICATION CHANGES. Specification changes are subject to acceptance by Seller, including price revisions and any adjustments necessary to cover material procured and processed and labor expended prior to receipt by Seller of revised specifications.

13.

FAIR LABOR STANDARDS ACT. The Seller represents that all items shall be manufactured or furnished in accordance with the applicable requirements of the Fair Labor Standards Act of 1938, as amended.

14.

GOVERNING LAW. All contracts between Buyer and Seller shall be governed by and construed in accordance with the applicable laws of the State of California.

15.

NON-WAIVER. Waiver by Seller of the breach of any of the terms and conditions of this contract shall be construed as a waiver of any other breach.

16.

RISK OF LOSS. Identification of the goods sold herein occurs at such time as Seller places said goods in the hands of the carrier for delivery as herein provided for. Upon identification, risk of loss passes to Buyer. Title remains with Seller until Seller receives payment for said goods.

17.

INDEMNIFICATION. Buyer will indemnify and hold Seller harmless from and defend Seller against, any loss suit, claim, or damage to persons or property arising out of this Agreement or Buyer's possession or use of the products provided, or any purchaser's possession or use of the products provided, which indemnity will survive the termination of this Agreement, provided that such loss, claim or damage was not caused solely by the fault of Seller.

18.

CANCELLATION. Buyer may cancel any order, provided written notice is received by Seller, thirty (30) days prior to shipment of the goods. On scheduled orders, the terms of the Blanket Purchase Agreement control all cancellations. In all cases, Buyer shall be liable for the payment of reasonable cancellation charges, which shall not exceed the cost to Seller for the products cancelled and shall include, but not be limited to, expenses already incurred by Seller and property allowable indirect charges.

19.

ATTORNEYS FEES. If any litigation is brought to enforce any rights created hereby, the prevailing party shall be entitled to attorney's fees and cost.