Terms and Conditions of Sale

NOTICE:  THIS TRANSACTION AND ALL DOCUMENTS PERTAINING TO IT, INCLUDING ANY QUOTATION, PROPOSAL, ORDER CONFIRMATION, ORDER ACCEPTANCE OR INVOICE (COLLECTIVELY, “SALES DOCUMENTS”) IS SUBJECT TO AND CONDITIONED UPON BUYER’S ACCEPTANCE OF THESE TERMS AND CONDITIONS OF SALE (“TERMS”) UNLESS OTHERWISE EXPRESSLY AGREED IN WRITING BY HOBART ELECTRONICS (“SELLER”). 

1. Order Process; Acceptance; Additional or Conflicting Terms.

• All sales of transformers, reactors, and any other products sold by Seller (individually, “Product” and collectively, “Products”) are contracts entered into in the State of Indiana and then only in accordance with Seller’s Sales Documents and these Terms.
• Seller shall sell Products to Buyer in the quantities and at the times agreed to by Seller in writing. Buyer may order Products by submitting written purchase orders (each, a “Purchase Order”) that contain the Product(s), quantity per Product, and requested delivery date. All orders submitted to Seller for Products, whether via Purchase Order or otherwise, are subject to final written acceptance by Seller and no orders are binding upon Seller until so accepted.  Buyer is solely responsible for proper selection and application of the Products.    
• Every contract between Buyer and Seller for the sale of Products shall be governed by the terms contained in Seller’s written quotation, proposal, any subsequent order confirmation and these Terms (the “Contract”). In no event shall Buyer’s terms apply to, nor shall Buyer’s proposed additional or different terms modify, the Contact unless Seller expressly includes the proposed terms in the Contract.  Seller hereby objects to and rejects any additional or different terms or conditions proposed by Buyer or contained in any Purchase Order, commercial document or other correspondence from Buyer, Unless expressedly agreed upon in writing with buyers siganature, regardless of any knowledge Seller may have of such terms, and such terms shall not bind Seller.  If any of these Terms conflict with Seller’s Sales Documents, the specific terms stated in those Sales Documents shall prevail over these Terms.  The Contract supersedes any commercial documents issued by Seller.  The applicable terms of the latest Sales Documents shall control over such terms in any prior Sales Documents.  No other terms or changes, modifications, amendments or waivers of any terms in the Contract shall apply to Seller unless in writing and signed by an authorized officer of Seller.  
• Buyer may not cancel or change the Contract except with the prior written consent of Seller (in which case a cancellation charge will apply equal to the greater of the value of the material and work performed on the cancelled order or 10% of the order value) and upon terms that will indemnify Seller against any loss. Seller may change an order at any time to correct mathematical or clerical errors.   

2. Prices; Payment.

• All prices will be as specified by Seller in its Sales Documents and are firm for the quantity and schedule set forth in the Sales Documents (and are subject to change if Seller allows a change in the quantity or schedule). If no price has been specified or quoted, will be Seller’s price according to its catalogs or price lists in effect at the time of delivery.  All prices published by Seller or quoted by Seller’s representatives may be changed at any time without notice.       
• The price does not include any sales, use, personal property, excise, transfer or other tax, duties or assessment related to the Products or their purchase and sale which may be imposed by any governmental authority, all of which shall be the obligation of, and paid by, Buyer. In the event that Seller pays any such tax or assessment, Buyer shall reimburse Seller in accordance with the terms of Section 2(c) but no discount shall apply to such tax or assessment.  Buyer is responsible for obtaining and providing to Seller any certificate of exemption or similar document required to exempt any sale from sales, use or similar tax liability.
• Unless expressly specified otherwise in Seller’s Sales Documents, the standard payment terms are payment is due within 30 days of the invoice date. If Buyer fails to make any payments when due, then (i) interest shall accrue from the date the payment was due until payment is received in full at the lower of 1.5% per month or the maximum amount allowed by applicable law, (ii) Buyer shall pay Seller’s reasonable attorneys’ fees and other costs of collection of any past due amounts, and (iii) Seller may, at its sole discretion, take any of the following actions: suspend performance; terminate the Contract for default; require Buyer to pay the full Contract price; and take any other actions or pursue any other remedies under applicable law. Failure by Seller to charge interest on late payments or to exercise its right to suspend its performance shall not be construed as a waiver of any other legal or equitable remedies.   

5. Termination. Without limiting Seller’s other rights and remedies available under applicable law, Seller may suspend or terminate performance and delivery, if: (a) there is a change in the control or management of Buyer; (b) Buyer ceases to conduct its operation in the normal course of business; (c) Buyer becomes insolvent or files for bankruptcy or has a bankruptcy proceeding filed against it; (d) Buyer makes an assignment for the benefit of credits, or a receiver, trustee in bankruptcy or similar officer is appointed to take charge of all or part of Buyer’s property; or (e) Buyer fails to perform or observe any of its obligations to Seller under the Sales Documents issued by Seller or under other existing or future contracts between Seller and Buyer or otherwise, including payment of any purchase price, fees or charges as and when due.
6. Delivery. Unless otherwise stated in Seller’s order confirmation, all deliveries of Products are Ex Works (Incoterms 2010) overseas facility.  The prices do not include any transportation, packaging or installation costs.  Seller may make partial deliveries.  Notwithstanding any requested delivery date by Buyer, the delivery date in Seller’s order confirmation shall control.  Any shipping or delivery schedule, quotation, forecast or commitment is only an estimate and Seller will not be liable for any delay or failure to deliver all or any part of any order for any reason.  Seller shall not be responsible for any damage to the Products caused by a carrier and Buyer’s sole recourse for such damage shall be against the carrier.  If at any time, in its sole judgment, Seller has any doubt as to Buyer’s financial responsibility, Seller may decline to make further shipments except upon receipt of a deposit or other satisfactory security or cash before shipment. 
7. Returned Products and Claims. Within fifteen (15) days after Buyer’s receipt of Products sold, Buyer must give written notice to Seller of any claim by Buyer based upon the condition, quantity, or grade of the Products sold or of any claimed nonconformity with the Product specifications, and the notice must indicate the basis of the claim in detail.  Buyer’s failure to comply with this paragraph shall constitute irrevocable acceptance by Buyer of the Products delivered and shall bind Buyer to pay to Seller the full price of such Products.  Products sold shall not be returned without Seller’s prior written consent; for any returns that Seller allows, a restocking fee will apply and Seller will not pay the transportation charges for any return unless authorized in advance.
8. Limited Warranty.

• Subject to these Terms, Seller warrants to Buyer only that the Products will conform to specifications published by Seller (or in the case of custom Products, the specifications that Buyer and Seller mutually agree upon in writing) [and be free from defects in material and workmanship] under proper storage and use for a period of 12 months from the date of delivery (“Warranty Period”). The limited warranty set forth in the previous sentence (“Limited Warranty”) is limited to the Buyer only and is non-transferable.  Buyer makes the decision on the selection and use of the Products and the Products’ suitability for use. 
• Buyer’s approval of any Product prototype shall be proof that the design meets the specifications. For any Product performance data and or physical dimensions (including specified levels of mechanical hum and magnetic strayfield) that Seller has not agreed upon in writing in advance of Seller’s production release of Buyer’s order, and which Buyer contends that deviate from the originally accepted prototype, Seller will, if technically possible, modify them at Buyer’s expense after Seller receives Buyer’s written authorization of such work.    
• EXCEPT FOR THE LIMITED WARRANTY EXPRESSLY PROVIDED IN SECTION 6(a) ABOVE, SELLER MAKES NO REPRESENTATIONS OR WARRANTIES REGARDING THE PRODUCTS AND SELLER DISCLAIMS ALL REPRESENTATIONS AND WARRANTIES, EXPRESS AND IMPLIED, WRITTEN OR ORAL, WITH RESPECT TO THE PRODUCTS, INCLUDING THE IMPLIED WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, AND NON-INFRINGEMENT.
• No dealers, distributor, sales representative, employee or any other person or entity is authorized to offer any different or additional warranties or remedies, or to change this Limited Warranty, without the signature of an authorized officer of Seller.

7. Limited Warranty Exclusions. The Limited Warranty does not cover damage to Products caused (i) during or after delivery; (ii) by normal wear and tear; (iii) by use under circumstances exceeding Seller’s specifications or limitations or contrary to any instructions or information contained in Seller’s operating or maintenance manuals (as supplemented from time to time by Seller); (iv) by unauthorized or improper installation, repair, alteration; (v) by non-original equipment manufacturer spare parts or components; (vi) by failure to provide reasonable and necessary maintenance; (vii) by improper storage; (viii) by corrosion, erosion, abrasion or similar causes; and (ix) by accidents. 
8. Buyer’s Limited Warranty Claims.

• Buyer must use its best efforts to test the Products for any alleged non-conformities prior to the Products’ use. The Limited Warranty is conditioned upon Buyer following the claims process then in effect, which Seller may change in its discretion. 
• Buyer shall timely give Seller written notice of any Products which Buyer alleges do not conform to the Limited Warranty, specifying the alleged non-conformities (each notice, a “Warranty Claim”). Buyer agrees to follow Seller’s warranty claims process, which may include obtaining from Seller a return authorization number in order to make a Warranty Claim.  Buyer must make any Warranty Claim timely after it arises, and in any event within 30 days after the end of the Warranty Period, and failure to do so shall void the Limited Warranty.  If Seller requests it, Buyer shall return any alleged non-conforming Product to a location designated by Seller for Seller to verify the claimed defect.  Seller shall have a reasonable opportunity to inspect the product or part thereof to determine whether it complies with the Limited Warranty.   
• For any Products which Seller determines do not conform to the Limited Warranty, Seller’s liability and obligation, and Buyer’s sole and exclusive remedy, shall be, at Seller’s choice, to either repair or replace non-conforming Products or to refund to Buyer the price Buyer paid for such non-conforming Products. Seller does not cover the cost to return non-conforming Products to Buyer.
• If the inspection of the product or part thereof does not disclose any failure to conform to the Limited Warranty, Seller will make repairs at a reasonable charge, which charges may include the cost of parts, labor and transportation, and the Buyer will be responsible for paying for all such charges and the cost to ship the product back to the Buyer.

9. Limitations; Exclusions.

• SELLER’S MAXIMUM AGGREGATE LIABILITY UNDER THE CONTRACT OR WITH RESPECT TO THE PRODUCTS OR THEIR USE, WHETHER IN WARRANTY, CONTRACT, TORT, STRICT LIABILITY OR OTHERWISE, SHALL NOT EXCEED THE AMOUNT BUYER PAID TO SELLER FOR THE PARTICULAR PRODUCTS AT ISSUE.
• Seller’s sole obligation and Buyer’s sole remedy for any breach of warranty shall be as set forth in Section 8(c).
• Seller is not responsible for any injury or damage resulting from the use or application of the Products, alone or in conjunction with other products.
• IN NO EVENT SHALL SELLER BE LIABLE FOR ANY SPECIAL, INDIRECT, INCIDENTAL, CONSEQUENTIAL, OR PUNITIVE DAMAGES, INCLUDING LOST PROFITS, REGARDLESS OF THE THEORY OF RECOVERY, EVEN IF SELLER HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.

10. Indemnity. Buyer agrees to indemnify, defend and hold harmless Seller, its officers, directors, its employees and agents from any and all claims, actions, suits, damages, liabilities, costs, obligations, and expenses (including, without limitation, attorneys’ fees) arising from or relating to (i) selection, application, use or incorporation of Products, (ii) any processing or modification of Products in any manner by Buyer, its employees, agents or customers, (iii) violation, misappropriation, or infringement of any patent, trademark, copyright or other intellectual property rights of any person or entity related to compliance with Buyer’s design, specifications or instructions, (iv) use exceeding Seller’s Product specifications, (v) any breach of warranty or misrepresentation (express or implied) made by Buyer, its employees or agents, and (vi) any violation of law or regulation by, intentional or negligent act of, or unauthorized representation by Buyer its employees or agents in their marketing activities, sales, distribution or handling of Products.  At Seller’s request, Buyer shall defend Seller, at Buyer’s expense, against any such claim made against Seller. 
11. Insurance. Buyer shall maintain commercial general liability, personal injury and property damage insurance policies, including wrongful death coverage, in reasonable amounts with a nationally recognized insurance company.
12. No License. Buyer agrees and confirms that it has no, and Seller’s sale of the Products shall not be construed as granting to Buyer any, license or intellectual property or similar right applicable to or in the Products, or any estimates, drawings, illustrations, calculations, installation instructions or other document Seller provides to Buyer even if developed jointly by Buyer and Seller.  Seller retains ownership and control over all intellectual property including patents, trademarks, and copyrights applicable to or arising out of the Products and services, whether developed by Seller or jointly, as well as the exclusive right to manufacture the Products.  Buyer shall not name or designate any Seller product information or Products in any process patent application.  Buyer may not alter or remove, and shall abide by, any patent, trademark, copyright, trade secrets, proprietary or other notices contained on or in the Products.
13. Confidential Information. All confidential or proprietary information (“Confidential Information”) provided by Seller to Buyer shall not be disclosed by Buyer to any person unless the disclosure is agreed to in writing by Seller or the Confidential Information is otherwise generally available to the public. 
14. No Setoff. Buyer shall not have any right of set-off with regard to any amounts owed to Seller, regardless of any dispute that may arise between the parties.
15. Limitation on Actions. Any action or proceeding by Buyer arising out of or relating to this Contract or the Products will be forever barred unless it is commenced within the earlier of:  (a) one year after the claim or cause of action has accrued; or (b) the period prescribed by applicable statute of limitation or repose.  Buyer must give Seller prompt written notice of any claim regarding this Contract or the Products.
16. Force Majeure. With the exception of payment requirements, neither party shall be liable, and performance shall be deemed extended, for delays or failure to perform directly or indirectly resulting from events and causes beyond its reasonable control, including but not limited to accidents, acts of God, acts and omissions of any governmental authority, declared or undeclared wars, terrorism, explosions, strikes or other labor disputes, fires and natural calamities (including floods, earthquakes, storms and epidemics), changes in the law, and delays in obtaining (or the inability to obtain) labor, materials or services through usual sources at normal prices. If Products, or labor, materials or services for producing Products, are not available through Seller’s usual sources at normal prices, then (a) Seller may allocate its supplies among its customers, including those not under contract, in any reasonable manner without liability, and (b) Seller will not be held to the price set forth in the Sales Documents and Seller and Buyer agree to re-negotiate the price based on those actual cost increases to Seller.  Seller shall have no obligation to purchase supplies of the Product to enable it to fulfill any order.     
17. No Waiver; Severability. Any failure by Seller to exercise any of its rights under these Terms or any Sales Documents shall not be construed as a waiver of such rights.  In the event any of the provisions of these Terms of any Sales Documents are held to be invalid by any court of competent jurisdiction, such provision(s) shall be deemed to be severable and these Terms and any Sales Documents shall then be construed and enforced in accordance with the remaining provisions.
18. Choice of Law; Venue. This transaction and any controversy arising from or relating to the transaction or the Products shall be governed by the laws of the State of Indiana, excluding its conflicts of law principles and this Contract shall not be governed by the provisions of the 1980 United Nations Convention on the International Sale of Goods (“UNCISG”) which is expressly excluded.  The parties agree that the Indiana State Courts and the United States District Court of Northern Indiana, shall constitute the sole and exclusive judicial forum(s) and venue and, therefore, shall have sole and exclusive jurisdiction over the adjudication and resolution of any and all disputes or controversies arising out of or relating to this Contract or the purchase and sale of Products; except (i) with respect to any action instituted by Seller for equitable or comparable relief including an action for temporary or permanent injunctive relief, (ii) for an action instituted by Seller for recovery of possession of the Products, such as replevin, claim and delivery, attachment or the like or (iii) for Seller’s claim or action to collect any amounts owed by Buyer pursuant to this Contract.  Buyer and Seller hereby consent and submit to the exercise of personal jurisdiction over them by the Indiana State Courts and United States District Court for the District of Indiana.
19. Non-Assignment; Entire Agreement. Buyer may not assign all or any portion of its rights or obligations under the Contract without Seller’s prior written consent, and any attempted assignment without that consent shall be void.  The Contract contains the entire agreement of the parties relating to the subject matter and supersedes all previous and contemporaneous agreements, understandings, usages of trade and courses of dealing, whether written or oral. 
20. Export Compliance Seller is committed to compliance with all Canada and U.S. Export Regulations and Laws. Seller will not sell or ship to countries embargoed by the U.S. Treasury Office of Foreign Asset Control (“OFAC”). Seller will not sell or ship to individuals or organizations identified by the U.S. Treasury as Specially Designated Nationals and Blocked Persons. Seller will not sell or ship products prohibited under Export Administration Regulations to individuals or organizations identified by the U.S. Department of Commerce, Bureau of Industry and Security (“BIS”). Seller will not seek export licenses pursuant to Export Administration. Furthermore, Seller prohibits the re-export, brokering or transshipment of its products to any individual, organization or country prohibited by the OFAC or BIS. The sale, resale or other disposition of Products, and any related technology or documentation, are subject to the export control laws, regulations and orders of the United States and may be subject to the export and/or import control laws and regulations of other countries.Seller is committed to conducting its operations around the globe ethically and in compliance with all applicable laws. Seller and its offshore plants are vigilant in complying with the laws and regulations governing its global export activities, which are critical to the Company’s success. The principal regulations governing international trade are the Canada Border Services Agency ( CBSA) ,U.S. Customs and Border Protection (CBP) regulations, International Traffic in Arms Regulations (ITAR), Export Administration Regulations (EAR) and similar laws around the world. It is the responsibility of the Seller, its customers and suppliers who engage in international trade activities to be familiar and comply with these regulations. Compliance with international trade laws and regulations is good for business and will not be compromised for commercial gain.

    Customer agrees to comply with all such laws, regulations and orders. Customer warrants that it will not export or re-export any Products with knowledge that they will be used in the design, development, production or use of chemical, biological, nuclear, or ballistic weapons, or in a facility engaged in such activities, unless Customer has obtained prior approval from the U.S. Department of Commerce. Customer further warrants that it will not export or re-export, directly or indirectly, any Products to embargoed countries or sell Products to companies or individuals listed on the Denied Persons List published by the US Department of Commerce, the Canadian Restricted Entities List published by the Department of Foreign Affairs and International Trade or any other international entity that maintains such a list. Customer further acknowledges that it shall not directly or indirectly export any Products to any country to which such export or transmission is restricted or prohibited. Customer acknowledges its responsibility to obtain any license to export, re-export or import as may be required. If at any time Customer breaches its obligations herein, Customer shall have an affirmative obligation to give notice thereof to Seller immediately without delay. Customer agrees that Seller may, in its sole discretion, terminate any and all of its obligations to Customer as a result of Customer’s breach regardless of whether Customer has given notice as required by this section. Seller shall not be subject to any liability as a result of, or in connection with such termination.

21. Compliance and Anti-Corruption Laws Customer agrees to abide by all laws and regulations applicable to anti-bribery or anti-corruption laws. Customer warrants that its officers, employees, and agents shall comply with the Corruption of Foreign Public Officials Act, S.C. 1998, c. 34 (“CFPOA”), the United Kingdom Bribery Act 2010, c.23 (“UKBA”), and any other similar anti-corruption legislation in any applicable jurisdiction where Seller or the Customer do business. Customer agrees to prohibit bribery and the payment of cash or cash equivalent directly or indirectly to government officials, political parties or candidates for the purpose of influencing any act or decision in connection with the purchase or resale of products ordered from Seller or corruptly obtaining or retaining business. If at any time Customer breaches its obligations herein, Customer shall have an affirmative obligation to give notice thereof to Seller immediately without delay. Customer agrees that Seller may, in its sole discretion, terminate any and all of its obligations to Customer as a result of Customer’s breach regardless of whether Customer has given notice as required by this section. Seller shall not be subject to any liability as a result of, or in connection with such termination.