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Terms and Conditions of Purchase of Processing Services


The following terms and conditions of purchase are applicable to every purchase order (“Order”) issued by Coilplus, Inc. (“Buyer”) to seller (“Seller”) for processing services (“Services”).

  1. OFFER/MODIFICATION: The terms and conditions set forth herein, together with the applicable Order and any other Buyer documents attached hereto or into which these terms and conditions are incorporated by reference (collectively, the “Contract”), constitute an offer or counteroffer by Buyer to purchase the Services from Seller, subject to and in accordance with these terms and conditions.  The Contract is not an acceptance of any offer or counteroffer made by Seller, and this offer and any contract arising out of this offer are expressly conditioned on Seller’s assent to all of the terms and conditions set forth in the Contract.  Buyer objects to any additional or different terms or conditions contained in any quotation, or other document or communication previously or hereafter provided by Seller to Buyer.  If a quotation or other document or communication from Seller contains any such additional or different terms or conditions, Buyer’s issuance of an Order shall not be construed as assent to any such terms or conditions, and no such terms or conditions will be of any force or effect unless specifically agreed to in a writing signed by an authorized representative of Buyer.
  2. ACCEPTANCE: The Contract shall be deemed accepted upon the terms and conditions of such Contract by Seller’s performance of Services, commencement of work on Materials (as defined in Section 4 of these Terms and Conditions of Purchase), shipment of Goods (as defined in Section 4 of these Terms and Conditions of Purchase), written acknowledgement, or any other conduct of Seller that recognizes the existence of a contract pertaining to the subject matter of the Contract.  Additionally, the Contract shall be deemed accepted ten (10) business days after Buyer delivers the Contract to Seller, if Seller fails to object to the Contract.
  3. ENTIRE AGREEMENT: The Contract constitutes the entire understanding between the parties with respect to the subject matter of the Contract, and supersedes all prior or contemporaneous discussions, negotiations, agreements, and understandings.  No waiver, amendment, or modification to the Contract shall be effective unless specifically made in a writing signed by an authorized representative of Buyer.
  4. SCOPE OF SERVICES AND DURATION: Seller shall process the goods/materials delivered by or on behalf of Buyer (“Materials”) into the final, processed products (“Goods”) in accordance with Buyer’s instructions and the terms and conditions of the Contract.  The scope of Services (including the quantity of Goods) applicable to each Order, and the duration applicable to each Order, are specified on the face of the Order.  Seller guarantees the conversion of Materials into Goods at a rate of at least 94.5% (or, if different, the conversion rate set forth in the Contract) for all Materials delivered to Seller (the “Conversion Rate”).  All processing costs, handling, packing, loading, and storage charges and other costs and expenses, whether similar or dissimilar in nature, incurred by Seller in connection with the discharge of its obligations under the Contract shall be borne solely by Seller.
  5. PROCESSING FEES: As Seller’s sole compensation for performing its obligations under the Contract, including, without limitation, processing of Materials, Buyer shall pay Seller a processing fee for Materials delivered by Buyer in accordance with the price(s) set forth in the Contract.  Prices charged for the Services listed on the Contract are not subject to increase, including, specifically, any increase based upon changes in currency fluctuations, raw material or component pricing, labor or overhead, unless specifically agreed to by Buyer on the face of the Contract or in a writing signed by an authorized representative of Buyer.  Seller represents that all prices comply with all applicable governmental laws and regulations in effect at the time of quotation, sale, performance of Services and delivery of Goods.  Seller shall ensure that the price charged to Buyer for Services remains competitive with the price for similar services available to Buyer from other sellers.  Buyer shall also receive the full benefit of all discounts, premiums and other favorable terms of payment customarily offered by Seller to its customers.  If Seller reduces its price for similar services during the term of the Contract, Seller agrees to reduce the prices of the Services to Buyer correspondingly.  Seller warrants that the prices in the Contract shall be complete, and no additional charges of any type shall be added without Buyer’s express written consent.  Buyer shall have no obligation under the Contract to pay a processing fee for any Services that are not in accordance with the Contract (including, without limitation, any Services resulting in Goods that do not comply with applicable warranties).
  6. PLANT: Seller shall perform all Services at its primary plant or any other plant of Seller agreed to by Buyer (in either case, the “Plant”).  Seller shall not assign, encumber, or dispose of the Plant without Buyer’s prior written consent for so long as the Contract is in effect and/or Seller is in possession of Materials supplied by Buyer or Goods processed from such Materials.  Seller represents, warrants and covenants to Buyer that at all times during the term of the Contract:  (a) the Plant shall be free from defects, shall be maintained and operated in accordance with all industry standards, laws (including, without limitation, environmental laws), and regulations, and shall be in good operating condition and repair; and (b) there shall be no actions, suits, investigations or proceedings (including any arbitration or mediation proceedings) pending against or, to Seller’s knowledge, threatened against Seller in respect of, or affecting the Plant, and there shall be no outstanding judgments, decrees or orders of any court, arbitrator or authority against Seller that relate to or arise out of the conduct of or the ownership, condition or operation of the Plant.
  7. TAXES: Unless prohibited by law, Seller shall pay all federal, state or local taxes, transportation taxes, or other taxes, including, but not limited to, customs, duties, tariffs, fees, charges for certificates of origin, consular invoices, and any other documents, that are required to be imposed upon the Services or the Goods ordered, or by reason of the sale of Services or the delivery of Goods.  All Contract prices shall be deemed to have included all such taxes.
  8. WARRANTY: Seller warrants that (a) the Services and Goods strictly conform to all specifications, performance characteristics, drawings, statements on containers or labels, descriptions, and samples furnished to Buyer, as well as all industry standards, laws, and regulations in force in countries in which the Services are performed and in which the Goods are produced or sold; (b) Seller has complied with QS 9000, ISO 14001, TS 16949, PPAP, APQP, and applicable reporting and other requirements; (c) the Goods shall be merchantable and fit and suitable for the particular purpose(s) intended by Buyer and Buyer’s customers and all other purposes for which such Goods are sold and used; (d) the Goods shall be free from defects in materials and workmanship; (e) the Goods shall be free and clear of all liens and encumbrances, good and merchantable title thereto being in Buyer; and (f) the price charged to Buyer for Services remains competitive with the price for similar services available to Buyer from other sellers.  These warranties shall survive performance, inspection, test, delivery, acceptance, use and payment by Buyer and shall inure to the benefit of Buyer, its successors, assigns, customers, and the users of Buyer’s goods and services.  These warranties may not be limited or disclaimed.  If Buyer experiences any breaches of any of the foregoing warranties, Buyer shall have the right, in addition to exercising all other rights Buyer may have under applicable law, to take the following actions, at Buyer’s option:  (i) retain the defective Goods in whole or in part with an appropriate adjustment in the price for the Services; (ii) require Seller to repair or replace the defective Goods in whole or in part at Seller’s sole expense, including all costs of replacement materials and all shipping, transportation and installation costs; (iii) correct or replace the defective Goods with similar items and recover the total cost relating thereto from Seller, including the cost of product recalls; or (iv) reject the defective Goods and receive from Seller a full refund of the fee for the applicable Services and, if applicable, an amount equal to the fair market value of such rejected Goods (but, in any event, an amount not less than Buyer’s cost of the applicable Materials with respect to such rejected Goods and related costs and expenses (including, without limitation, shipping costs)).  Buyer shall not lose its right to claim for any loss and damage, including damage caused to any direct or indirect customer purchasing the Goods from Buyer, caused thereby in spite of such replacement, repair and/or compensation.  Seller shall defend and hold Buyer harmless from any liability and claim arising from any alleged defect in the Services or Goods or any other similar claim arising from the Services or from the sale and/or use of the Goods.
  9. INSPECTION AND REJECTIONS: Buyer shall have the right (but not the obligation) to monitor and observe the performance of Services, to inspect the Plant, and to inspect, to review work progress, and to test all Goods, special tooling, materials and workmanship to the extent practicable at all times and places (including at the Plant) during the period of performance of the Services and storage of Materials or Goods.  If any inspection or test is to be made on the premises of Seller, 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.  Notwithstanding the foregoing, however, any inspection or payment for Services by Buyer shall not constitute a waiver of Buyer’s remedies for any breach by Seller of any warranty, whether express or implied.
  10. MATERIALS: Seller shall not process any materials for Buyer other than the Materials delivered by or on behalf of Buyer.  Each time Seller takes delivery of the Materials, Seller shall measure, analyze and determine the quantity and quality of the Materials so delivered, in accordance with the appropriate means or methods established in the industry, and shall, within three (3) business days from such delivery, notify Buyer in writing of the quantity so determined (and any discovered non-conformity of the Materials to the Materials’ specifications, if any).  Notwithstanding the foregoing, all Materials are provided “as is” without warranty.  Seller shall deliver to Buyer a confirmation of receipt of each shipment of Materials to Seller.  Seller shall not use the Materials for any purpose other than producing Goods for Buyer, and shall not sell or transfer any of the Materials or Goods to any person or entity other than Buyer unless specifically directed in writing to do so by Buyer.  Except for the Materials, Buyer shall not be required to furnish any goods, services or facilities necessary for the performance of the Services.  At any time upon Buyer’s request, Seller shall return the Materials and any Goods to Buyer in accordance with shipping instructions furnished by Buyer.
  11. INVENTORY REPORTS: On or before the last day of each month, and at such other times as may be requested by Buyer, Seller shall deliver to Buyer an inventory certificate that sets forth the quantity of Materials (including all Materials in process that do not yet constitute Goods (“WIP”)) and Goods inventory then held by Seller for Buyer’s account.  Seller acknowledges and agrees that Buyer has the sole discretion to determine the quantity of Materials (including WIP) and Goods for Buyer’s account that can be held in inventory by Seller.
  12. SCRAP MATERIALS: For each coil of Materials provided by Buyer, Seller shall deliver to Buyer a processing report setting forth the original weight of such coil and the weight of the Goods resulting from such coil.  The difference in the two weights accounts for the scrap materials for such coil resulting from the Services (“Scrap Materials”).  Without limiting Buyer’s rights and remedies (including as a result of Seller’s failure to process the Materials at the Conversion Rate), for any such Scrap Materials (regardless of the Conversion Rate for such coil), Seller shall take title to such Scrap Materials and issue a credit to Buyer (which shall be set off against the processing fees otherwise payable by Buyer for the Services) at the AMM Midwest #1 heavy melt price or at such other scrap price as may be set forth in the Contract or otherwise agreed to by Buyer and Seller.
  13. RISK OF LOSS OF MATERIALS: The risk of loss of and damage to the Materials shall pass from Buyer to Seller upon delivery of the Materials to the Plant.  Any loss or damage to the Materials or Goods, whenever occurring, resulting from Seller’s nonconforming storage, handling, processing, packaging or delivery shall be borne by Seller.
  14. OWNERSHIP OF MATERIALS AND GOODS: (a) Title to all inventories of (i) Materials delivered by Buyer, (ii) any WIP at the Plant, and (iii) Goods processed for Buyer’s account shall at all times remain vested in Buyer, and not in Seller or any other person or entity, and Seller shall use and process such Materials in strict accordance with, and solely for purposes of, the Contract.  Seller shall ensure that Goods converted by Seller for Buyer pursuant to this Agreement, as well as any unprocessed Materials (including WIP), shall be completely segregated and separate from, and not commingled with, any inventory of Seller or any other goods or products held by Seller, and shall be kept in an area that shall be clearly and conspicuously marked by signs or other similar means of identification as “Property of Coilplus, Inc.”  Without diminishing Buyer’s right to receive a volume of Goods corresponding to the supplied Materials at the Conversion Rate, Seller shall have title to all Scrap Materials pursuant to and in accordance with Section 12, and Seller shall process, recycle or dispose of such Scrap Materials, as well as any other waste, byproducts or residue resulting from the Services, in accordance with all applicable laws (including, without limitation, all environmental laws).  (b) Upon request by Buyer following the occurrence of a Seller Insolvency (as defined in Section 29 of these Terms and Conditions of Purchase) or a breach of the Contract by Seller, Seller shall surrender all such Materials, WIP and Goods to Buyer.
  15. NO LIENS ON MATERIALS OR GOODS: SELLER SHALL NOT ALLOW ANY MECHANIC’S, CONTRACTOR’S, MATERIALMAN’S, OR OTHER LIENS, ENCUMBRANCES, CHARGES OR SECURITY INTERESTS TO ENCUMBER THE MATERIALS, THE GOODS, OR ANY OF BUYER’S OTHER REAL OR PERSONAL PROPERTY BY VIRTUE OF ANY SERVICES, WORK, LABOR OR MATERIAL PERFORMED OR PROVIDED BY SELLER, AND SELLER SHALL AT ALL TIMES DEFEND, INDEMNIFY, AND HOLD HARMLESS BUYER WITH RESPECT TO ANY AND ALL CLAIMS, LOSSES, COSTS, FEES, CHARGES, EXPENSES AND LIABILITIES OF ANY NATURE OCCURRING OR ACCRUING FROM ANY SUCH LIENS, ENCUMBRANCES, CHARGES OR SECURITY INTERESTS.  FURTHER, TO THE MAXIMUM EXTENT PERMITTED BY APPLICABLE LAW, SELLER HEREBY WAIVES AND RELEASES BUYER AND BUYER’S REAL AND PERSONAL PROPERTY (INCLUDING THE MATERIALS AND GOODS) FROM ANY AND ALL STATUTORY OR POSSESSORY LIENS ACCRUED OR THAT MAY ACCRUE TO IT.  Should any mechanic’s, contractor’s, materialman’s, or other lien, encumbrance, charge or security interest come to encumber the Materials, Goods or any other property of Buyer as a result of the Services or performance of Seller’s other obligations under the Contract, or Seller’s action or inaction, Seller shall promptly procure the release of same without any cost or charge to Buyer.  Further, Seller expressly authorizes Buyer to pay any such lien, encumbrance, charge or security interest and deduct the appropriate amount from any payment due Seller.  Buyer may withhold such amount or amounts otherwise due Seller until Buyer receives appropriate evidence that any and all liens, encumbrances, charges or security interests have been removed.
  16. PRECAUTIONARY SECURITY INTEREST FILING: Buyer may (a) file any financing or continuation statement as Buyer determines is necessary or desirable to evidence Seller’s status as bailee with respect to Materials delivered by Buyer, WIP and Goods held for the account of Buyer, and evidencing Buyer’s status as owner and a secured party with respect to such Materials, WIP and Goods, and (b) send any notices to any of Seller’s secured creditors providing notice of such statements, the transactions contemplated by the Contract, and/or Buyer’s rights and interests in such Materials, WIP and Goods.  Seller shall take such other actions as Buyer reasonably requests to protect Buyer’s ownership rights in the Materials and Goods and/or to inform third parties of Buyer’s ownership rights in the Materials and Goods.  Seller shall deliver to Buyer any negotiable document of title received for the Materials, WIP or Goods, title to which is at all times in Buyer, promptly upon Seller’s receipt thereof.  In the event of any breach by Seller of the Contract or any termination of the Contract, in addition to any other rights and remedies available to Buyer, Buyer shall immediately have all rights of a secured party after default under a security agreement, and Seller shall pay all costs and expenses, including attorneys’ fees, incurred by Buyer in enforcing such rights.
  17. SHIPMENT OF GOODS: (a) Performance of Services and deliveries of Goods shall be made both in quantities and at times specified in the Contract or in other similar documents furnished by Buyer.  Time of performance, and time and quantity of delivery, are of the essence.  Unless otherwise specifically agreed to in a writing signed by an authorized representative of Buyer, partial shipments of the Goods shall not be permitted.  In the event of delay in performance or in shipment or delivery due to any cause not attributable to Buyer, Buyer shall have the option either to terminate the Contract in whole or in part or to extend the period for performance, shipment or delivery, and if performance, shipment or delivery is further delayed due to any cause not attributable to Buyer beyond the period so extended by Buyer, Buyer may terminate the Contract in whole or in part at any time thereafter.  In any event, any such extension or termination or partial termination shall be without prejudice to any other rights and remedies available to Buyer.  Goods received in advance of Buyer’s delivery schedule may, at Buyer’s option, be returned at Seller’s expense or be accepted and payment for the corresponding Services made in accordance with the scheduled delivery date for such Goods.  (b) Promptly after the Goods are dispatched, Seller shall cable or fax to Buyer notice of shipment or delivery specifying the contract number, invoice amount, description of the Goods and packaging, quantity loaded or dispatched, transportation route(s), mode(s) of transportation, carrier number(s) and/or corresponding details for other carriage, date, time and place of shipment or delivery, expected or estimated time of arrival of the Goods at the specified destination and other information relative to the Contract requested by Buyer.  Such notice shall be in addition to and not in substitution for any other notice Seller may be obliged to give to Buyer under applicable law or otherwise.  The giving of any such notice shall not affect any claim by Buyer in respect of late or defective delivery.  (c) Premium shipping expenses and/or other related expenses necessary to meet delivery schedules set forth in the Contract shall be Seller’s sole responsibility, unless the delay or expense was solely the result of Buyer’s negligence and Seller provides Buyer with notice of any claim against Buyer within ten (10) days after the occurrence of the alleged negligent action of Buyer giving rise to such claim.  Notwithstanding any agreement concerning payment of freight expenses, except where shipment is by Buyer’s vehicle, delivery shall not have occurred and the risk of loss shall not have shifted to Buyer until the Goods have been delivered to Buyer’s facility and have been accepted at that facility.  Notwithstanding anything in this Section 17 to the contrary, title to the Goods shall at all times remain with Buyer.  (d) For each Good that is shipped, Seller shall package and label such Good in accordance with Buyer’s packaging and labeling specifications, including, as applicable, by including a tag containing such information regarding such Good as is required by Buyer (including specifications originally provided by the supplier of the Materials used for such Good such as, for example, the chemical composition and mechanical properties of such Good).
  18. EXCUSED PERFORMANCE: Any delay or failure by either party to perform its obligations shall be excused if (a) caused by an extraordinary and unforeseeable event beyond the control of the nonperforming party and without the nonperforming party’s fault or negligence, such as acts of God, fires, floods, windstorms, explosions, riots, natural disasters, wars and sabotage, and (b) such event could not have been prevented by the nonperforming party’s reasonable precautions or commercially accepted processes, or could not reasonably be circumvented by the nonperforming party through the use of substitute services (such as substitute transportation services), alternate sources, work-around plans or other means by which the requirements of the Contract could be satisfied.  Events meeting both of the criteria set forth in clauses (a) and (b) above are referred to individually and collectively as “Force Majeure Events.”  Upon the occurrence of a Force Majeure Event, the nonperforming party shall be excused from any further performance or observance of the affected obligation(s) for as long as such circumstances prevail and such party continues to attempt to recommence performance or observance to the greatest extent possible without delay.  Written notice of any delay caused by a Force Majeure Event, including the anticipated duration of the delay, must be given by the nonperforming party as soon as reasonably practicable, in any event not to exceed seven (7) days following the Force Majeure Event.  During the period of any delay or failure to perform by Seller, Buyer, at its option, may purchase services from other sources and reduce its schedules to Seller accordingly, without liability to Buyer.  If requested by Buyer, Seller shall, within five (5) days of such request, provide adequate assurance that the delay will not exceed such period of time as Buyer deems appropriate.  If a Force Majeure Event continues for longer than thirty (30) days, then Buyer, at its sole option, may terminate any Order affected thereby or the Contract in whole or in part without any obligation or liability except that Buyer is still responsible for payment for Services in respect of Goods that have been delivered to and accepted by Buyer prior to receipt of the notice of the Force Majeure Event.  Seller acknowledges and agrees that, without limitation, the following will not constitute Force Majeure Events and will not excuse performance by Seller under theories of force majeure, commercial impracticability or otherwise, and Seller expressly assumes these risks: (i) change in cost or availability of materials, components or services based on market conditions, supplier actions or contract disputes; (ii) failure of Seller’s internal business systems related to the proper processing of data or other information that results in any defect or failure in products or services, deliveries, or any other aspect of performance by Seller or its subcontractors; (iii) vandalism; (iv) the regulatory acts of governmental agencies; (v) labor strikes; or (vi) the non-performance of third parties or subcontractors relied on for the performance of Services or the delivery of Goods, except to the extent that such failure or non-performance by a third party or subcontractor is itself caused by a Force Majeure Event.
  19. INSURANCE: Seller shall fully insure all Materials (including all WIP) and Goods during the entire period Materials and/or Goods are located at Seller’s premises.  In addition, Seller shall provide comprehensive general liability insurance, professional liability insurance and insurance for an amount consistent with industry standards (but, in any event, for an amount at least equivalent to one hundred ten percent (110%) of invoice amount), covering marine insurance of “All Risks” and “War and S.R.C.C. Risks,” unless otherwise agreed.  Any additional insurance shall be provided by Seller in favor of Buyer on Buyer’s account upon the specific request of Buyer.  All insurance in this Section 19 shall be at Seller’s expense with first class insurance companies satisfactory to Buyer and shall name Buyer as an additional insured.  Upon Buyer’s request from time to time, Seller shall provide Buyer with certificates of insurance evidencing the insurance required by this Section 19.  If Buyer is required to provide insurance, Seller shall timely and accurately advise Buyer of shipping particulars so as to enable Buyer to provide necessary insurance.  Should Seller fail to perform as stipulated above, Seller shall, notwithstanding the terms of shipment to the contrary, bear all risks on the Goods until delivery at destination stipulated on the face of the Contract.
  20. INTELLECTUAL PROPERTY: Seller shall be liable for any infringement or claim with regard to industrial or intellectual property rights on or in relation to the Services or the Goods or containers, such as patents, utility models, trademarks, tradenames, designs, copyright, and patterns, whether in Buyer’s country or any other place.  If any dispute or claim arises out of or in relation to any of the above industrial or intellectual property rights, Buyer shall have the right to terminate forthwith all or any part of the Contract by giving written notice of termination to Seller, and Seller shall hold Buyer harmless from any liability arising therefrom and shall be liable to Buyer for all losses and damages, including costs, expenses and charges for defensive actions by Buyer.
  21. BUYER’S PROPERTY; TOOLS, DESIGN WORK, DRAWINGS, SPECIFICATIONS AND TECHNICAL INFORMATION: Buyer shall have no obligation to furnish or pay for any design work, drawings, tools or other equipment required for the performance of any Order; provided, however, that Buyer may, at its option, purchase any such items especially required by Seller for any Order at the current value thereof on Seller’s books for income tax purposes and any item so purchased shall be deemed furnished to Buyer under the Contract.  Any design, drawing, specification, photograph, tool or other equipment or material or part or engineering and manufacturing information heretofore or hereafter furnished to Seller by Buyer, or the cost of which shall have been paid by Buyer or included in the aggregate price of any Order, whether or not separately itemized in the Contract, shall be and remain Buyer’s property, shall be conspicuously identified as such in Seller’s records and by physical marking thereon, shall be promptly delivered to Buyer upon request, shall be treated as Confidential Information (as defined in Section 32 of these Terms and Conditions of Purchase), shall not be used in processing or manufacturing goods for anyone other than Buyer and, while in the possession of Seller, shall be Seller’s responsibility and shall be adequately insured at Seller’s expense for the benefit of Buyer against loss or damage by fire or other hazard.  No change shall be made in any design, drawing, specification, tool or other equipment furnished by Buyer without Buyer’s express written consent.  Any information that Seller may disclose to Buyer with respect to the design, processing, manufacture or sale or use of the items covered by any Order shall be deemed to have been disclosed as part of the consideration for that Order, and Seller shall not assert any claim against Buyer by reason of Buyer’s use thereof.
  22. INDEMNIFICATION BY SELLER: Seller shall defend, indemnify and hold harmless Buyer and its directors, officers, employees, agents, representatives, successors, assigns, and customers (whether direct or indirect) from and against any and all claims, suits, judgments, proceedings, liabilities, losses, damages and expenses (including attorneys’ fees and other costs of defending any action), whether based on or arising from any claim of negligence, breach of warranty, breach of contract, damage to property, personal or bodily injury, sickness, disease, death, patent or trademark infringement, environmental liability, product liability, strict liability in tort, or based on any other theory of law or equity or otherwise, based upon, arising out of or in connection with (a) the Services or the Goods furnished by Seller under the Contract, including, without limitation, (i) any claim that the Services or the Goods furnished by Seller fail to conform to or comply with any federal, state, local or foreign laws, regulations or standards, or (ii) any defect in or health issue caused by the Services or the Goods; (b) any breach of the Contract by Seller; (c) any claim by any third party relating to any right, title or interest in or to the Materials, the WIP or the Goods; or (d) any construction, installation, facilities or other services furnished by Seller under or in connection with any Order.  Such indemnity shall apply notwithstanding the negligence (other than gross negligence) of Buyer or its directors, officers, employees, agents, representatives, successors, assigns, or customers (whether direct or indirect), except for willful misconduct or gross negligence by the specific individual so indemnified.
  23. REMEDIES: (a) The rights and remedies reserved to Buyer shall be cumulative with, and additional to, all other or further remedies provided in law or equity.  Without limiting the generality of the foregoing, should any Services or Goods fail to conform to the warranties set forth in the Contract, if requested by Buyer, Seller shall reimburse Buyer for any special, incidental and consequential damages caused by nonconforming Services or Goods, including, but not limited to, costs, expenses and losses incurred by Buyer (i) in inspecting, sorting, testing, repairing or replacing such nonconforming Goods (or the Materials for such Goods), (ii) resulting from production interruptions, and (iii) in connection with claims for personal injury (including death) or property damage caused by such nonconforming Goods.  (b) If Seller breaches the Contract in any way or if there is a Seller Insolvency, Buyer shall (without prejudice to any other right or remedy that it may have) have the right (i) to terminate any or all of the Contract and/or any other contract with Seller by giving notice of termination to Seller, (ii) to stop and/or suspend the performance of any or all of its obligations under the Contract and/or any other contract with Seller without giving any notice, (iii) to reject all or any part of the unperformed Services and/or the delivered or undelivered Goods, (iv) to demand immediate delivery of the Materials and Goods at Seller’s risk and expense, and/or (v) to demand immediate reimbursement for the fair market value of all Materials, WIP or Goods not delivered to Buyer (but, in any event, an amount not less than Buyer’s cost of the applicable Materials with respect to such undelivered Materials, WIP or Goods and related costs and expenses (including, without limitation, shipping costs)).  Notwithstanding any delivery of Materials, WIP or Goods required by Buyer, Buyer reserves the right to reject any such Materials, WIP or Goods not in acceptable condition, taking into account the condition of the Materials at the time of original receipt by Seller, and Seller shall promptly pay Buyer, in addition to any other amounts then owing under the Contract, an amount equal to the fair market value of such rejected Materials, WIP or Goods (but, in any event, an amount not less than Buyer’s cost of the applicable Materials with respect to such rejected Materials, WIP or Goods and related costs and expenses (including, without limitation, shipping costs)), whereupon title to such Materials, WIP or Goods shall vest in Seller.  (c) In any such event as is specified in this Section 23, Seller shall pay to Buyer compensation in respect of all such loss and damage as may result therefrom, including, but not limited to, compensation for loss of profit that Buyer would otherwise have made on subsequent resale of the Goods, compensation for any additional expenditure reasonably incurred by Buyer in obtaining any other services, goods or materials in replacement of those in respect of which the Contract has been determined and compensation for all losses and damages caused by reason of occurrence of any of above-mentioned events.  (d) Buyer may terminate or suspend the performance of all or any part of the Contract in the event of closing of the foreign exchange, prohibition of import, refusal of issue of import licenses, or restriction by laws, regulations, ordinances, rules, governmental orders or directions, or administrative guidance, without any liability whatsoever.  (e) In addition to any other rights of Buyer to terminate the Contract, Buyer may immediately terminate all or any part of the Contract, at any time without cause, by notifying Seller in writing at least seven (7) days prior to the termination, and Buyer’s sole liability for such termination shall be limited to the processing fees for the Services performed by Seller prior to its receipt of such termination notice.
  24. SETOFF/RECOUPMENT: (a) In addition to any right of setoff or recoupment allowed by law, all amounts due Seller, or any of its subsidiaries or affiliates shall be considered net of indebtedness or obligations of Seller, or any of its subsidiaries or affiliates to Buyer or any of its subsidiaries or affiliates, and Buyer may set off against or recoup from any amounts due or to become due from Seller, or any of its subsidiaries or affiliates to Buyer or any of its subsidiaries or affiliates, however and whenever arising, including, but not limited to, Buyer’s attorneys’ fees and costs of enforcement.  In the event that Buyer or any of its subsidiaries or affiliates reasonably feels at risk, Buyer may withhold and recoup a corresponding amount due Seller or any of its subsidiaries or affiliates to protect against such risk.  (b) If an obligation of Seller or any of its subsidiaries or affiliates to Buyer or any of its subsidiaries or affiliates is disputed, contingent or unliquidated, Buyer or any of its subsidiaries or affiliates may defer payment of all or any portion of the amount due until such obligation is resolved.  Without limiting the generality of the foregoing and by way of example only, in the event of a bankruptcy of Seller, if all of the Contract and Orders between Buyer and Seller have not been assumed, then Buyer may defer payment to Seller, via an administrative hold or otherwise, for Services against potential rejection and other damages.  In the event of a Seller insolvency, Buyer also may set off, recoup, and/or withhold from amounts due Seller or any of its subsidiaries or affiliates any amounts that Seller is obligated to indemnify Buyer pursuant to the Contract, regardless of whether such amounts become due before or after the filing of a petition for bankruptcy protection by Seller.
  25. THIRD-PARTY CLAIMS: For any third-party claim for which Seller is liable to Buyer under the Contract, Buyer shall have the right, in each case at Seller’s expense, (a) to select and retain counsel of Buyer’s choice, (b) to control the defense of any such claim, and (c) to settle or otherwise resolve any such claim.
  26. SURVIVAL: Any provision of the Contract that by its nature or terms is intended to extend beyond the termination or expiration of the Contract (including this Section 26 and Sections 8, 10, 13, 14, 15, 16, 20, 22, 23, 32, 34, 35 and 38 of these Terms and Conditions of Purchase) shall survive the termination or expiration of the Contract.
  27. SELLER FINANCIAL AND OPERATIONAL CONDITION: (a) Seller represents and warrants to Buyer as of the date of each Order (which representations and warranties shall be deemed repeated as of the date of Seller’s acceptance of each Order for Services and at the time of each performance of Services and each delivery of Goods under the Order) that: (i) there is no Seller Insolvency, and Seller is in compliance with all loan covenants and other obligations; (ii) all financial information provided by Seller to Buyer concerning Seller is true and accurate; (iii) such financial information fairly represents Seller’s financial condition; and (iv) all financial statements of Seller have been prepared in accordance with generally accepted accounting principles, uniformly and consistently applied.  (b) Seller shall keep accurate and complete books and records regarding the transactions under the Contract.  Seller shall permit Buyer and its representatives to review Seller’s books and records concerning compliance with the Contract and Seller’s overall financial condition and agrees to provide Buyer with full and complete access to all such books and records for such purpose upon Buyer’s request.  Seller agrees that, if Seller experiences any delivery or operational problems, Buyer may, but is not required to, designate a representative to be present in Seller’s applicable facility to observe Seller’s operations.  Seller agrees that, if Buyer provides to Seller any accommodations (financial or otherwise, including providing designated representatives as set forth above) that are necessary for Seller to fulfill its obligations under the Contract, Seller shall reimburse Buyer for all costs, including attorneys’ and other professionals’ fees, incurred by Buyer in connection with such accommodation and shall grant a right of access to Buyer to use Seller’s premises, machinery, equipment and other property necessary for the performance of Services and processing of Materials into Goods covered by the Contract (and a lien to secure the access right) under an access and security agreement.  (c) Seller agrees to provide prompt written notice to Buyer of any impending or threatened Seller Insolvency.
  28. COMPLIANCE WITH LAWS; INFORMATION ON GOODS: Seller shall conduct its business (including the operation of the Plant) in strict compliance with all laws and regulations, including, but not limited to, any environmental laws and any anti-corruption laws, such as the Foreign Corrupt Practices Act of the United States.  Seller shall timely obtain, effectuate and maintain in force any required permit, license, exemption, filing, registration and other authorization in respect of the performance of the Services, the operation of the Plant, and the use, handling, transportation, storage, export, sale or disposal of the Materials and Goods, required under any applicable laws or regulations relating to, among other things, the environment, control of chemical substances and restriction of hazardous substances.  Upon request from Buyer, Seller shall provide Buyer with information on, evidence of or certificate of the Services, the Materials or the Goods to discharge any obligation Buyer may have under any applicable law or regulation in respect of the Materials or the Goods, in a form and substance fully satisfactory to Buyer.
  29. SELLER INSOLVENCY: Buyer may immediately terminate the Contract without any liability of Buyer to Seller upon the occurrence of any of the following or any other similar or comparable event (each, a “Seller Insolvency”): (a) insolvency of Seller; (b) Seller’s inability to promptly provide Buyer with adequate and reasonable assurance of Seller’s financial capability to perform timely any of Seller’s obligations under the Contract; (c) filing of a voluntary petition in bankruptcy by Seller; (d) filing of an involuntary petition in bankruptcy against Seller; (e) appointment of a receiver or trustee for Seller; or (f) execution of an assignment for the benefit of creditors of Seller.  Seller shall reimburse Buyer for all costs incurred by Buyer in connection with a Seller Insolvency, including, but not limited to, all attorneys’ fees and other professional fees.
  30. LIMITATIONS ON BUYER’S LIABILITY: IN NO EVENT SHALL BUYER BE LIABLE TO SELLER FOR ANTICIPATED PROFITS OR FOR SPECIAL, INCIDENTAL OR CONSEQUENTIAL DAMAGES.  The parties further agree that, with respect to a claim arising out of or in connection with the termination of the Contract or any breach thereof by Buyer, Buyer’s liability, if any, shall be limited to the total processing fees for the Services provided by Seller in the three (3) months immediately preceding the alleged termination or breach.
  31. TIME FOR BRINGING ACTION: Any action by Seller related to the Contract must be commenced within one (1) year after the cause of action has accrued.
  32. CONFIDENTIALITY: All proprietary and confidential information, including, but not limited to, the nature of the Services, the identity and quantity of the Materials supplied or of the Goods ordered and other manufacturing or business information, supplied by Buyer (collectively, “Confidential Information”) shall remain Buyer’s property.  Confidential Information shall not be reproduced, used or disclosed to others by Seller without Buyer’s prior written consent.  Confidential Information shall not include information Seller can demonstrate: (a) is generally available to the public other than as the result of disclosure by Seller in violation of the Contract or any other confidentiality obligation; (b) is legally in Seller’s possession at the time of receipt from Buyer; or (c) is obtained by Seller from a third party that is in lawful possession of the information and that has the right to make disclosure thereof, but only if the third party has authorized Seller’s use thereof.  Immediately upon termination of the Contract, all Confidential Information, together with any copies thereof, shall be returned to Buyer.
  33. NO ASSIGNMENT: Seller shall not assign its rights or delegate (or subcontract/sublet) its duties under the Contract, in whole or in part, without the prior written consent of Buyer, and any attempted or purported assignment or delegation (or subcontracting/subletting) without such consent shall be null and void.  Any subcontract of any of the Services that is consented to by Buyer shall be in writing and shall contain provisions that (a) preserve and protect the rights and remedies of Buyer under the Contract with respect to the Services being performed under the subcontract so that the subcontracting thereof will not prejudice such rights or remedies; (b) require the Services to be performed in accordance with all requirements of the Contract; (c) give third-party beneficiary rights to Buyer; and (d) recognize that Buyer owes no duties whatsoever to the subcontractor.  Seller shall be responsible for all subcontracted portions of the Services and for the acts and omissions of its subcontractors and for their compensation.
  34. GOVERNING LAW: The construction, interpretation and performance of the Contract and all transactions thereunder shall be governed by the law of the State of Illinois, without regard to principles of conflicts of law.  The 1980 United Nations Convention on Contracts for the International Sale of Goods is expressly excluded.
  35. RESOLUTION OF DISPUTES: Seller and Buyer agree that any dispute, controversy or claim arising out of or relating to the Contract, including the formation, interpretation, breach or termination thereof, including whether the claims asserted are arbitrable, will be referred to and finally determined by arbitration in accordance with the JAMS International Arbitration Rules.  The tribunal will consist of three arbitrators.  The place of arbitration will be the City of Chicago, Illinois.  The language to be used in the arbitral proceedings will be English.  Judgment upon the award rendered by the arbitrators may be entered in any court having jurisdiction thereof.  Buyer and Seller will bear equally the costs and expenses of JAMS and the arbitrators.
  36. EQUAL EMPLOYMENT OPPORTUNITY: The Equal Opportunity Clause set forth in Executive Order 11246, as amended (30 F.R. 12319), and the Affirmative Action Clauses set forth in the relevant federal government regulations pertaining to government contractors and subcontractors (41 C.F.R. §60-250.4 (Vietnam Veterans and Disabled Veterans) and 41 C.F.R. §60-741.4 (Handicapped)), are incorporated by reference herein.
  37. ELECTRONIC COMMUNICATIONS AND ELECTRONIC SIGNATURES: The Contract and any written document issued or delivered pursuant to or in connection with the Contract may be executed by facsimile signature or by scanned electronic image files attached to email and any such facsimile signature or electronic image file shall constitute an original for all purposes.  In addition, Seller shall comply with any method of electronic communication specified by Buyer, including requirements for electronic funds transfer, order transmission, production orders, electronic signature, and communication.
  38. MISCELLANEOUS: (a) The failure of Buyer at any time to require full performance by Seller of the terms of the Contract shall not affect the right of Buyer to enforce the same.  The waiver by Buyer of any breach of any provision of the Contract shall not be construed as a waiver of any succeeding breach of such provision or waiver of the provision itself.  (b) If any term(s) of the Contract is invalid or unenforceable under any statute, regulation, ordinance, executive order or other rule of law, then, at Buyer’s option, either (i) such term(s) shall be deemed reformed or deleted, as the case may be, but only to the extent necessary to comply with such statute, regulation, ordinance, order or rule, and the remaining provisions of the Contract shall remain in full force and effect, or (ii) the Contract shall be terminated without any liability of Buyer to Seller.  (c) Seller agrees to pay any and all attorneys’ fees and other costs and expenses that may be incurred by Buyer to enforce any of the terms and conditions of the Contract or due to the breach by Seller of any of the terms and conditions of the Contract.  (d) Seller and Buyer are independent contracting parties and nothing in the Contract shall make either party the agent or legal representative of the other for any purpose whatsoever, nor does it grant either party any authority to assume or to create any obligation on behalf of or in the name of the other party.  (e) The Contract shall not confer any rights or remedies upon any other person or entity, other than the parties to the Contract and their respective successors and permitted assigns.  (f) The headings used in the Contract are for the purpose of reference and convenience only, and shall not limit or affect the meaning of provisions to which they refer.