TERMS & CONDITIONS |

1. TERMS AND CONDITIONS

No terms and conditions other than those set forth in this order (including terms and conditions in any document attached to or incorporated by reference in this Order) shall be binding upon International Thermal Systems LLC (Purchaser) unless accepted by it in writing and signed by a buyer or other authorized representative of Purchaser. All specifications, drawings, notes, instructions, engineering notices or technical data referred to in this order are incorporated herein by reference. No condition, different or additional terms stated by Seller in any acceptance or acknowledgement of this order, shall be binding upon Purchaser unless expressly accepted by it in writing, whether or not such different or additional terms and conditions materially alter this order, and Purchaser hereby objects to any such different or additional terms and conditions.

2. COMPLIANCE WITH REGULATORY STANDARDS

Contractor shall obtain any licenses and permits required to perform the work covered by this Purchase Order and in performing the work the Contractor shall comply with the applicable federal, state and local environmental, health, safety and other relevant federal, state and local governmental standards, regulations, codes, and requirements, including but not limited to the applicable standards, regulations, codes and requirements administered by the U.S. Department of Transportation, the U.S. Environmental Protection Agency and the Occupational Safety and Health Administration of the U.S. Department of Labor and their state and local governmental counterparts.

3. FAIR LABOR STANDARDS ACT

In accepting this order Seller shall be deemed to represent that the goods to be furnished hereunder were or will be produced in compliance with the requirements of the Fair Labor Standards Act of 1938, as amended, and unless otherwise agreed in writing, Seller shall insert a certificate on all invoices submitted in connection with this order stating "The Seller certifies that the goods specified on this invoice were produced in compliance with all applicable requirements of the Fair Labor Standards Act of 1938, as amended, including Sections 6, 7 and 12 and regulations and orders of the United States Department of Labor issued under Section 14 thereof."

4. EXTRA CHARGES, INVOICES AND PAYMENT

No charges of any kind, including but not limited to those for taxes, boxing, storage or cartage, will be allowed unless specifically agreed to in writing by the Purchaser. Price is to cover net weight, unless otherwise agreed. Unless specifically provided for in this order, no invoices shall be issued nor payment made prior to delivery. All State and Federal Excise, Sales and Use Taxes, when applicable, shall be stated separately on the invoice. Unless freight, taxes and other charges are itemized, any discount will be taken on the full amount of invoices. All payments are subject to adjustment for shortage or rejection.

5. TRANSPORTATION

Transportation charges on goods sold shall be prepaid by Seller unless Purchaser expressly agrees in writing to the contrary. No parcel post insurance charges will be allowed unless authorized by Purchaser in writing. No charges for unauthorized transportation will be allowed and any excess charges resulting from the use of unauthorized transportation will be charged back to the Seller. Seller shall release rail or truck shipments at the lowest released valuation permitted in the governing tariff or classification.

6. DELIVERY

Seller Bears Risk of Loss in Transit.

Delivery shall not be deemed to be complete until materials have been actually received and accepted by Purchaser, not withstanding any agreement to pay freight, express, parcel post or other transportation charges, and the risk of loss or damage in transit shall be upon the Seller.

Schedule

Unless otherwise agreed in writing, Seller shall not make material commitments or production arrangements in excess of the amount or in advance of the time necessary to meet Purchaser's delivery schedule. It is Seller's responsibility to comply with this schedule, but not to anticipate Purchaser's requirements. Goods shipped to Purchaser in advance of schedule may be returned to Seller at Seller's expense.

Delays

Seller will not be liable for damages for delays in delivery due to causes beyond its reasonable control. If Seller, however, for any reason does not comply with Purchaser's delivery schedule, Seller shall promptly notify Purchaser, and Purchaser, in addition to any other rights, may at its option either approve a revised delivery schedule or may terminate this order without liability to Seller.

7. WARRANTIES

In addition to warranties implied in fact or law, the Seller warrants that all articles, materials and/or services covered by this order will be merchantable and free of defects in material and workmanship, and will conform to applicable specifications, drawings, samples and descriptions. In case any such less item shall be defective or otherwise not in conformity with this order, Seller shall at Purchaser's option and in addition to all other remedies of the Purchaser, either credit the Purchaser for, or at Seller's own expense replace, repair or correct any such materials. Such warranties together with service warranties and guarantees shall run to the Purchaser, its successors, assigns, customers and to the users of its products; and shall survive any inspection, delivery acceptance or payment by the Purchaser for the materials or services. The Seller shall hold the Purchaser harmless from any damage arising from a breach of these warranties

• PURCHASER'S PROPERTY

Unless otherwise agreed in writing, or unless superceded under terms of a Government Contract identified in this order (including documents attached or incorporated thereto) all tools, equipment or material of every description furnished to Seller by Purchaser or specifically paid for by Purchaser, and any replacement thereof, and any materials affixed or attached thereto, shall be and remain the personal property of the Purchaser. Such property, and whenever practical each individual item thereof, shall be plainly marked or otherwise adequately identified by Seller as "Property of International Thermal Systems LLC" and shall be safely stored, at no expense to Purchaser, separate and apart from Seller's property. Seller shall not substitute any property for Purchaser's property and shall not use such property except in filling Purchaser's orders. Such property, and whenever practical each individual item thereof, shall be plainly marked or otherwise adequately identified by Seller as "Property of International Thermal Systems LLC" and shall be safely stored, at no expense to Purchaser, separate and apart from Seller's property. Seller shall not substitute any property for Purchaser's property and shall not use such property except in filling Purchaser's orders. Such property while in Seller's custody or control shall be held at Seller's risk, shall be subject to removal at Purchaser's written request, in which event Seller shall prepare such property for shipment and shall redeliver it to Purchaser in the same condition as originally received by Seller, reasonable wear and tear excepted, all at Seller's expense.

Seller further agrees not to use any designs, tools, patterns, drawings, materials or other information or equipment furnished by the Purchaser in the manufacture or design of any article or material for any other customer.

• CHANGES

Purchaser may at any time by written notice make changes in drawings, specifications, descriptions, shipping instructions, quantities and/or delivery schedules. Should any change increase or decrease the cost of, or the time required for performance of this order, Seller shall immediately notify Purchaser and an equitable adjustment will be negotiated, evidenced by a written amendment to this order. No changes or additional changes made by the Seller will be valid unless authorized in writing by the Purchaser.

• PRODUCTS METHODS AND MANUFACTURING PROCESSES

Any knowledge or information which the Seller shall have disclosed or may hereafter disclose to the Purchaser incident to the placing and filling of this order, shall not, unless specifically agreed upon in writing by the Purchaser, be deemed to be confidential or proprietary information, and accordingly shall be acquired free from any restriction (other than restrictions which may result from a claim for patent infringement). Notwithstanding anything to the contrary herein contained, no employee of Purchaser has authority to make any agreement express or implied limiting the use or publication of, or providing for confidential treatment of information or suggestions of whatever kind received by the employee, unless such agreement is made in writing and signed by the President of International Thermal Systems LLC.

• PATENTS

Seller agrees to indemnify and hold harmless Purchaser, and/or its customers, against any and all liability, loss and expense (including attorney’s fees) by reason of any claim, action or litigation arising out of any alleged or actual, direct or contributory infringement of patent arising from the purchase, use or sale of subject materials. In case the purchase, use or sale of said goods, or any part thereof, is held to constitute infringement and/or is enjoined, Seller shall, at its own expense, procure for Purchaser and its customers the right to continue the purchase, use and sale of said goods; or, with the approval of Purchaser, modify said goods so they become non-infringing, or remove said goods and refund the purchase price and the transportation and installation costs thereof. If this order involves experimentation, research or development work, Seller agrees to grant the Purchaser an irrevocable, nonexclusive and royalty-free license to make, have made, use and sell any inventions resulting from the work under this order.

• NON-ASSIGNMENT

Assignment of this order or any interest therein or any payment or to become due thereunder, without the written consent of the Purchaser, shall be void.

• SUBCONTRACTING

Seller shall not procure, or contract for the procurement of any item covered by this order in completed or substantially completed form without first securing the written approval of the Purchaser.

• SET OFF

Purchaser shall be entitled at all times to set off any amount owing at any time from Seller to Purchaser or any of its affiliated companies against any amount payable at any time by Purchaser in connection with this order. By affiliated companies’ is meant any corporation, firm or association which is controlled by or which controls Seller.

• BANKRUPTCY

If Seller ceases to conduct its operations in the normal course of business (including inability to meet its obligations as they mature) or if any proceeding under the bankruptcy or insolvency laws is brought by or against the Seller, or a receiver for Seller is appointed or applied for or an assignment for the benefit of creditors is made by Seller, Purchaser may terminate this order without liability except for deliveries previously made or for goods covered by this Order then completed and subsequently delivered in accordance with the items of this order.

WORK PERFORMED ON PREMISES

If Seller's work under this order involves operations by Seller on the premises of Purchaser or one of its customers, Seller shall take all necessary precautions to prevent the occurrence of any injury to person or property during the progress of such work and except to the extent that any such injury is due solely and directly to Purchasers or its customer's negligence, and the case may be, shall indemnify Purchaser against all loss which may result from any act or omission of the Seller, its agents, employees, or subcontractors, and Seller shall maintain such Public Liability, Property Damage and Employee's Liability and Compensation Insurance as will protect Purchaser from said risks and from any claims under any applicable Workman's Compensation and Occupational Disease Acts.

INSPECTION

1. All goods (which term throughout this order includes without limitation raw materials, components, intermediate assemblies and end products) shall be subject to inspection and test by the Purchaser and its customer (which term throughout this clause shall include without limitation the Government) to the extent practicable at all times and places including the manufacture and in any event prior to final acceptance by the Purchaser and its customer.
2. If any inspection or test is made on the premises of Seller or its supplier, Seller without additional charge shall provide all reasonable facilities and assistance for the safety and convenience of the inspectors in the performance of their duties. All inspections and tests on the premises of Seller or its supplier shall be performed in such a manner as not to unduly delay the work.
3. Final acceptance or rejection of the goods shall be made as promptly as practicable after delivery, except as otherwise provided in this order, but failure to inspect and accept or reject good shall neither relieve the Seller for responsibility for such goods as are not in accordance with the order requirements nor impose liability on Purchaser thereof.
4. It is expressly agreed that payment shall not constitute final acceptance. Defective materials will be returned at Seller's risk and expense at the full invoice price, plus incoming transportation charges, if any, and no replacement of defective materials shall be made unless specified in writing by the Purchaser. Purchaser may reject and return any portion of shipment which may be defective or fail to comply with specifications, drawings, samples or descriptions stated in the order without invalidating the remainder of the order.
5. Seller shall provide and maintain an inspection system acceptable to Purchaser and its customer covering the goods hereunder. Records of all inspection work by Seller shall be kept complete and available to Purchaser and its customers during the performance of this order and for such longer period as may be specified elsewhere in this order.

1. ASSEMBLY RECORDS

When specifications or drawings require Seller to serially number assemblies, Seller shall maintain records of all such serially numbered assemblies by part number and serial number. In addition, when such specifications or drawings require Seller to serial number detailed parts of said assemblies, Seller shall maintain records of the source, drawing number and serial number of such detailed parts. Seller shall maintain all such records for three (3) years from the date of completion of this order.

2. PRICES AND DISCOUNTS

The prices and terms are as stated in the purchase order.

It is understood that the cash discount period shall be computed from date of receipt by Purchaser of acceptable invoice or material, whichever is later. On invoices returned for correction, the cash discount period will date from the receipt of the corrected invoice.

3. CONTINGENCIES

Purchaser reserves the right at its option, either to suspend shipments of materials covered by this order or to cancel this order, in whole or in part, at any time where such suspension or cancellation is caused by or reasonably results from United States Government orders or other requirements, embargoes, acts of civil or military authorities, acts of public enemy, inability to secure transportation facilities, strikes, differences with workman, accidents at Purchaser's works or other contingencies, whether similar or dissimilar to the foregoing enumeration, beyond Purchaser's control.

4. CERTIFICATION

The Seller will comply with all provisions of Executive Order 11246, as amended, the provision found in 41 C.F.R. sec. 60-741.5 (Disabled Persons) and sec. 6–250.4 (Veterans), and all relevant rules, regulations and orders of the Secretary of Labor.