Purchase Order Terms and Conditions
1. Supplier’s Obligations
Supplier shall supply the equipment, material, goods or services (“Goods and Services”) identified in the Purchase Order (“PO”) pursuant to the terms and conditions contained herein and in the PO (collectively with the PO, the “Agreement”). Goods and Services are to be supplied at the locations and by the delivery dates set forth in the PO. Supplier shall provide proper and adequate packaging in accordance with prevailing industry standards to ensure Goods shipped to Buyer will be free of damage. Supplier shall use qualified personnel and equipment and facilities that meet industry standards. Supplier shall respect all relevant legislation, regulations, labour laws, immigration laws, import-export regulations and environmental and industry standards in all jurisdictions where Supplier operates and the Goods and Services are delivered. Supplier shall maintain records and provide regular reports pursuant to NanoXplore Inc.’s, or any affiliated company’s (“Buyer”) instructions on the delivery of the Goods and Services, their conformity with the service levels and specifications identified to Supplier, and the application of any service level payments identified in the PO in the event of non-conformity. Supplier means Supplier, its personnel, affiliates and subcontractors involved in the supply of Goods and Services.
2. Buyer’s Obligations
Buyer shall pay Supplier for the Goods and Services at the agreed Price set forth in the PO pursuant to the submission of a valid, detailed invoice presented in the currency set forth in the PO, subject to the terms and conditions of this Agreement. Buyer reserves the right to inspect the Goods and Services and reject them in part or completely if they do not meet the service levels and the specifications, and request a replacement, refund or credit at Supplier’s cost including transport, and to dispute or reject any associated invoice in part or completely. In no event will acceptance of the Goods and Services by Buyer be presumed or deemed, including without limitation due to any act of Buyer such as the payment of the invoice. Inspection and acceptance by Buyer does not relieve Supplier of its warranty obligations.
3. Financial Matters
Supplier shall submit electronic invoices upon delivery of the Goods and Services. Unless otherwise expressly stated in the PO, Buyer shall pay invoices sixty (60) days from the date on the invoice, subject to acceptance. Supplier is required to accept payment electronically. If applicable, any discounts or rebates set out in the PO or for early payment shall be identified on the invoice, as well as any applicable service level payments. Buyer reserves the right to audit such invoices against Supplier’s reports and to perform independent verification. Unless otherwise expressly stated in the PO, prices include custom duties and expenses, tariffs and all federal, provincial, state or local taxes (including all import taxes, excise taxes and sales taxes) applicable to the manufacture, sale or provision of the Goods and Services. Buyer may offset any amounts owed to Supplier against amounts owed by Supplier. Goods and Services shall be made available to Buyer DDP (Incoterms 2020) Buyer Plant unless otherwise specified in the PO. Transfer of ownership of Goods shall occur on a DDP Buyer Plant basis.
4. Delivery and Production Volumes
Time is of the essence of this Agreement. Supplier shall deliver the Goods in the quantities and on the delivery dates and times specified in this Agreement. Supplier shall immediately notify Buyer in writing if Supplier is unable to deliver the Goods in the quantities and on the delivery dates and times specified in this Agreement. Goods delivered in excess of the quantities or in advance of delivery dates or times specified in this Agreement shall be at Supplier’s risk and may be returned to Supplier by Buyer, and all transportation charges both to and from the original destination shall be paid by Supplier. Buyer shall not be required to make payment for any Goods delivered to Buyer that are in excess of the quantities specified in this Agreement. Unless otherwise expressly stated in this Agreement or authorized in writing by Buyer, Supplier shall not make any commitments for raw materials or other inventory or manufacture any Goods in advance of the time necessary to permit shipments on the delivery dates. Buyer may on notice to Supplier change the rate of scheduled shipments or direct temporary suspension of scheduled shipments, neither of which shall entitle Supplier to a modification of the price of the Goods or the Services covered by this Agreement.
Supplier warrants that any representation made in a quote or otherwise regarding its production capacity shall be considered a warranty that Supplier can manufacture or produce the stated quantity of the Goods or the Services without the imposition of overtime charges or other surcharges. Supplier acknowledges that any estimates or forecasts of production volumes or length of program, whether from Buyer or any of Buyer’s customers, are subject to change from time to time, with or without notice to Supplier, and shall not be binding upon Buyer. Unless otherwise expressly stated in this Agreement, Buyer makes no representation, warranty, guarantee or commitment of any kind or nature, whether express or implied to Supplier in respect of Buyer’s quantitative requirements for the Goods or the Services or the term of supply of the Goods or the Services.
If Supplier fails or refuses to proceed with this Agreement or fails to deliver the Goods or perform the Services within the delivery dates and times specified in this Agreement, Buyer may, without limiting or affecting its other rights or remedies available hereunder or at law, cancel the then remaining balance of this Agreement, unless the delay is an excusable delay (as defined in below). In addition, if Supplier fails to meet the delivery dates or times of the Goods, other than by reason of an excusable delay, Buyer may, without limiting or affecting its other rights or remedies available hereunder or at law, direct expedited shipment and/or incur premium freight or transportation costs, and Supplier shall pay upon demand all excess costs incurred thereby, including additional handling charges and other expenses (whether related or not) resulting therefrom. Supplier shall be responsible for all other direct, consequential, and incidental damages incurred by Buyer as a result of Supplier’s failure to meet the delivery dates or times, other than by reason of an excusable delay, including the cost of any line shutdown and the cost of obtaining goods from an alternate source. Buyer’s actions in obtaining substitute or replacement products shall not limit the rights and remedies available hereunder or at law. The term “excusable delay” means any delay in making or accepting deliveries or performance which results without fault or negligence on the part of the party involved and which is due to causes beyond its reasonable control, such as acts of God or of a public enemy, any preference, priority or allocation order issued by government or any other act of government, fires, floods, epidemics, quarantine restrictions, freight embargoes, explosions, riots, war, terrorism and delays of a supplier due to such causes. The term “excusable delay” shall not, however, mean or include any delay arising from or as a result of: (i) Supplier’s financial difficulties; (ii) a change in cost or availability of materials or components based on market conditions or supplier actions affecting Supplier; or (iii) any labor strike or other labor disruption applicable to Seller or to any of its subcontractors or suppliers that are engaged in manufacturing or providing goods or services to Supplier in connection with Supplier’s obligations under this Agreement. An excusable delay shall not constitute a default hereunder, provided that if Seller is subject to one or more excusable delays that persist for more than thirty (30) days in the aggregate, Buyer may cancel the then remaining balance of this Agreement, without limiting or otherwise affecting its other rights or remedies available hereunder or at law.
Seller, at its expense, shall use its best efforts to mitigate any adverse effects or costs to Buyer due to any actual or potential delay, including: (i) the implementation of a production contingency plan. Unless otherwise expressly stated in this Agreement, Buyer shall not be required to purchase the Goods or the Services exclusively from Supplier.
5. Effective Date, Term and Termination
Supplier’s delivery of Goods and Services under the PO shall constitute acceptance of these Terms and Conditions, which are incorporated by reference in the PO. The Agreement shall be formed in Montreal as of the date set forth on the PO (“Effective Date”) and shall remain in full force and effect for the period set out in the PO (“Term”) unless terminated earlier as per the below. Either Party shall have the right to terminate this PO for default in the event that a Party does not perform a material obligation including without limitation meeting any service levels or specifications and fails to correct such non-performance within fifteen (15) days from the date on the notice of default. Supplier will return all physical or intellectual property and Information to Buyer and shall reasonably cooperate with Buyer in the termination and transition of Goods and Services including the transfer of all data regarding the supply of Goods and Services over the Term. The bankruptcy or insolvency of either Party shall entitle the other to terminate this Agreement, to the extent permitted by law. Without further penalty, obligation or liability to Supplier, Buyer may terminate any PO at any time and without cause by giving Supplier at least twenty (20) business days written notice.
6. Price Warranties and Competitiveness
Supplier warrants that the prices for the Goods and the Services are, and shall ensure that such prices remain, not less favorable to Buyer than the prices currently extended to any other customer of Supplier for the same or substantially similar goods or services in the same or substantially similar quantities and delivery requirements. If Supplier reduces the prices of such same or substantially similar goods or services during the term of this Agreement, Supplier shall reduce the prices of the Goods and the Services correspondingly.
Supplier warrants that the prices in this Agreement shall be fixed, complete, and no surcharges, premiums or other additional charges of any type shall be added, without Buyer’s prior written consent. Supplier expressly assumes the risk of any event or cause (whether or not foreseen) affecting such prices, including, without limitations, any foreign exchange rate changes, increases in raw materials costs, inflation, change of applicable laws, increases in labor and other manufacturing costs. Supplier shall ensure that the Goods and the Services remain competitive, in terms of price, technology and quality, with substantially similar goods and services available to Buyer from other suppliers.
7. Representations and Warranties
Supplier represents and warrants that: (i) it is duly organized or incorporated in the relevant jurisdictions and has full capacity to enter into this Agreement and perform its obligations hereunder; (ii) no hardware or software or other material used in the supply of the Goods and Services infringes any intellectual property rights or liens of any third party; (iii) Supplier holds all right, title and interest in the Goods and Services; (iv) it operates in compliance with all laws and regulations (including applicable insider trading, anti-bribery and privacy laws); and (v) this Agreement does not violate any other agreement binding on Supplier.
Supplier represents and warrants that the Goods and Services (i) will perform in accordance with the service levels, drawings, samples, specifications and other description furnished or specified by Buyer; (ii) shall conform with all applicable laws, regulations, rules, codes and standards of the jurisdiction where the Goods and Services are to be sold; (iii) are merchantable; (iv) are free from latent or manifest defects in materials, workmanship and design; (v) are fit, sufficient and suitable for the particular purpose for which Buyer intends to use them; (vi) are free from all liens, claims and encumbrances whatsoever, and (vii) will be performed by well-qualified personnel in accordance with best established industry standards. These warranties are continuous and extend to new or additional Goods and Services that may be supplied.
8. Liability and Indemnification
Supplier shall indemnify and hold harmless Buyer from any losses, liens, damages, liability, and expenses of any nature or kind (including court costs and actual attorney, legal and other professional fees) (“Damages”) incurred by Buyer arising from Supplier’s breach of its obligations or warranties under this Agreement; any third party claims; or Supplier’s access to Buyer’s premises. In the event that Buyer has incurred Damages, Buyer shall notify Supplier and Supplier shall indemnify Buyer for the Damages and hold harmless Buyer against any third party legal claims associated with the Damages. No third party claim may be settled without the consent of Buyer, which consent shall not be unreasonably withheld.
In the event that Supplier is supplying Goods or Services or accessing Buyer’s sites, it shall maintain Comprehensive General Liability with an insurer acceptable to Buyer, in an amount (in the currency set forth in the PO) of no less than ten million dollars ($10,000,000) per occurrence, for damage to or destruction of property (including loss of use), including products and completed operations coverage and contractual liability, or a combined single limit of ten million dollars ($10,000,000) for bodily injury including death. If the supply of Goods and Services includes the provision, lease or hire of licensed vehicles on behalf of Supplier, or accessing Buyer’s sites by vehicle, Supplier shall have Automobile Liability insurance in an amount of no less than five million dollars ($5,000,000) per occurrence. Supplier shall provide Workers Compensation coverage (or its equivalent) for its personnel and subcontractors in accordance with the statutory limits in the relevant jurisdiction and reimburse Buyer for any claims that Buyer must pay for which Supplier is responsible. Supplier shall name Buyer as an additional insured and provide a certificate of
insurance pursuant to which Buyer will be notified of any cancellation or material change to coverage. Any deductible or self-insurance shall be of a level acceptable to Buyer.
10. Force Majeure
Notwithstanding anything to the contrary in this Agreement, neither Party shall be liable for delay or non- performance caused by any of the following circumstances when beyond its control: such as acts of God or of a public enemy, any preference, priority or allocation order issued by government or any other act of government, fires, floods, epidemics, quarantine restrictions, freight embargoes, explosions, riots, war, terrorism (“Force Majeure“). The term Force Majeure shall not, however, mean or including any delay arising from or as a result of: (i) Supplier’s financial difficulties; (ii) a change in cost or availability of materials or components based on market conditions or supplier actions affecting Supplier, or (iii) any labor strike or other labor disruption applicable to Supplier or to any of its subcontractors or suppliers that are engaged in manufacturing or providing goods or services to Supplier in connection with Supplier’s obligations under this Agreement. Should an event of Force Majeure make it impossible for a Party to perform its obligations hereunder, the affected Party shall try to reduce or mitigate the adverse impact of the event. The affected Party shall notify the other Party that it considers an event of Force Majeure has occurred. If the adverse impact cannot be eliminated completely, such non-performance shall be excused for the duration of the event of Force Majeure. If, however, the event of Force Majeure lasts more than thirty (30) days from the original notification, this Agreement may be terminated in whole or in part by the non-affected Party.
Supplier shall consider and treat all Information as confidential and shall not disclose any Information to any other person, or use any Information itself for any purpose other than pursuant to and as required by this Agreement, without Buyer’s prior written consent. Buyer retains all rights with respect to the Information, and Supplier shall not acquire, nor attempt to obtain, any patent, trademark, copyright, license or other rights in respect of the Information. Supplier shall not allow any Information to be reproduced, communicated or in any way used, in whole or in part, in connection with services or goods furnished to others, without Buyer’s prior written consent. For the purposes of this Agreement, “Information” means all drawings, reproductions, specifications, designs, engineering instructions, photographs, reproducible copy, parts lists, plans, reports, working papers, computations and other information furnished by Buyer and shall include all terms and conditions and any other information relating to, or contained in, this Agreement. Supplier shall not advertise or otherwise disclose the fact that Buyer has contracted to purchase the Goods and Services from Supplier, without Buyer’s prior written consent. Supplier shall preserve the confidentiality and accessibility of Information with administrative, technical and physical measures that meet or exceed generally recognized industry standards. Without limiting the generality of the foregoing, Supplier shall, at all times, maintain network security that includes, at a minimum, network firewall protection, intrusion detection and regular vulnerability scanning and penetration testing. In the event of a breach of Supplier’s security network, Supplier shall notify Buyer in writing of such an event within 24 hours of discovery.
12. Intellectual Property
Supplier hereby grants to Buyer, its successors and assigns, and Buyer hereby accepts, a non-exclusive, irrevocable, worldwide license, including the right to sublicense to others in connection with providing the Goods and Services to Buyer, under: (i) patents, industrial designs, technical information, know-how, processes of manufacture and other intellectual property, owned or controlled by Supplier or its affiliates, and relating to the Goods and Services, to make, have made, repair, reconstruct, rebuild, relocate, use, sell and import the Goods and Services, and (ii) any works of authorship fixed in any tangible medium of expression (including drawings, prints, manuals and specifications) produced or furnished by Supplier in the course of Supplier’s activity under this Agreement, to reproduce, distribute and display such works and to prepare derivative works based thereon, subject to the other provisions of this Agreement (all items in clauses (i) and (ii) above, collectively, “Supplier’s Intellectual Property”, and such license in respect thereof, the “License”). Supplier acknowledges and understands that the License shall be effective from the first date of delivery of the Goods and Services under this Agreement and extend for so long as Buyer has contractual obligations to its customers.
To the extent that Supplier creates or develops any patents, industrial designs, technical information, know- how, processes of manufacture or other intellectual property in the performance of Supplier’s obligations under this Agreement, Supplier shall: (i) assign to Buyer each invention, discovery or improvement (whether or not patentable) that is conceived or first reduced to practice by Supplier, or by any person employed by or working under the direction of Supplier, in the performance of Supplier’s obligations under this Agreement; and (ii) promptly disclose in an acceptable form to Buyer all such inventions, discoveries or improvements and cause Supplier’s employees to sign any papers necessary to enable Buyer to obtain title to and to file applications for patents throughout the world. To the extent that any works of authorship (including, without limitation, software and computer programs) are created in the performance of Supplier’s obligations under this Agreement, such works shall be considered “works made for hire”, and to the extent that such works do not qualify as “works made for hire”, Supplier hereby assigns to Buyer all right, title, and interest in all copyrights and moral rights therein.
Supplier shall not manufacture or provide, or offer to manufacture or provide, any goods or services that are based in whole or in part upon Buyer’s intellectual property and/or the drawings or specifications in respect of the Goods and Services, or any derivative thereof, whether for its own purposes (other than to satisfy its obligations under this Agreement) or any other third parties, without Buyer’s prior written consent. The foregoing restriction shall not apply in respect of “off-the-shelf” or “catalogue” goods or services that have been routinely manufactured or provided by Supplier and developed by Supplier, in each case prior to this Agreement and independently of its relationship with Buyer.
13. Governing Law, Dispute Resolution
If the location of Buyer from which this Agreement or the PO was issued is in Canada, this Agreement shall be interpreted and enforced in accordance with the local, domestic laws of the Province of Quebec and of Canada, exclusive of the choice of law rules thereof. If the location of Buyer from which this Agreement or the PO was issued is in the United States of America, this Agreement shall be interpreted and enforced in accordance with the local, domestic laws of the State of North Carolina and of the United States of America, exclusive of the choice of law rules thereof. Except as otherwise expressly stated in this Agreement, if the location of Buyer from which this Agreement or the PO was issued is other than as set forth above, this Agreement shall be interpreted and enforced in accordance with the local, domestic laws of the Province of Quebec and of Canada, exclusive of the choice of law rules thereof. For greater certainty, the United Nations Convention on Contracts for the International Sale of Goods shall not apply to this Agreement.
Any litigation on contractual claims arising from this Agreement may be brought by Buyer in any court having jurisdiction over Supplier or, at Buyer’s option, in any court having jurisdiction over any Buyer’s locations specified in this Agreement, in which event Supplier consents to jurisdiction and service of process in accordance with applicable procedures. Any claim or proceeding by Supplier against Buyer may be brought by Supplier only in the court having jurisdiction over the location of Buyer from which this Agreement was issued. Supplier irrevocably waives and agrees not to raise any objection it might now or hereafter have to any such claim or proceeding in any such court, including any objection that the place where such court is located in an inconvenient forum or that there is any other claim or proceeding in any other place relating in whole or in part to the same subject matter.
Except as otherwise expressly stated in this Agreement, any notice given or other communication sent under this Agreement shall be in writing and shall be properly delivered to its addressee by hand, prepaid courier, registered mail, e-mail (receipt confirmed) or facsimile (receipt confirmed) at the applicable address noted on the face of the PO. Any notice or communication given as provided herein shall be deemed to have been received at the time of its delivery if delivered by hand, on the business day following its dispatch if transmitted by courier, e-mail or facsimile or on the third business day following its mailing if transmitted by registered mail. Either Party may notify the other Party, in the manner provided for herein, of any change of address, for the purpose of giving notices or sending communications under this Agreement.
The PO, these Terms and Conditions and any specifications, service levels, or instructions provided by Buyer, constitute the entire agreement between the Parties and take precedence over any other
understandings or communications, oral or written, and over any Supplier terms and conditions or purchase orders. If a master agreement exists between Buyer and Supplier to govern the supply of Goods and Services identified in the PO, the terms and conditions of the master agreement shall apply to such Goods and Services. If any clause is unenforceable, it shall be severed and the other clauses will remain in full force. Any clause which by its nature should survive termination will do so, including without limitation the Confidentiality, Liability and Indemnification, Intellectual Property and Representations and Warranties clauses. The Parties are independent contractors and nothing herein shall make them agents, employees, or partners and there shall be no joint and several liability. The non-exercise by a Party of a right hereunder does not constitute a waiver of such right. Nothing herein shall be interpreted to create an exclusivity in favor of Supplier unless otherwise set out in the PO. Time is of the essence. Supplier shall not use Buyer’s name for the purposes of advertising, press releases, promotion or solicitation without the prior written consent of Buyer. Supplier may not assign, transfer or otherwise dispose of any of its rights or sub-contract, transfer or otherwise dispose of any of its obligation under the OP or this Agreement without Buyer’s prior written consent. These Terms and Conditions may be updated by Buyer from time to time and Supplier commits to review them regularly. Les Parties se sont expressément entendues pour que ces termes et conditions soient rédigés en langue anglaise. The Parties have expressly agreed that these terms and conditions should be drafted in English.