PURCHASE ORDER TERMS AND CONDITIONS
These Purchase Order Terms and Conditions (“Terms and Conditions”), and a Purchase Order (with any and all appendices, and/or exhibits attached thereto or otherwise issued by Deep Hole Specialists, LLC (“DHS”) in connection herewith, collectively, the “Purchase Order”) by and between DHS and Vendor (as defined in the Purchase Order) (DHS and Vendor, collectively, the “Parties,” each a “Party”), constitute the entire agreement between DHS and Vendor and supersede and replace any and all prior discussions and agreements between the Parties. If any discrepancy, difference or conflict exists between the various provisions of the Purchase Order and these Terms and Conditions, these Terms and Conditions shall govern. Capitalized terms used but not defined herein shall have the meanings ascribed in the Purchase Order. DHS hereby gives notice of its objection to any different or additional terms other than those terms and conditions set forth herein.
1. Agreement and Changes. By Vendor’s acceptance of the Purchase Order, Vendor agrees to abide by all key product and/or process characteristics or specifications, payment terms, deadlines and any other requirements expressed on the Purchase Order. In addition, Vendor is required to ensure that any and all sub-tier vendors, as applicable, also abide by said characteristics, specifications, payment terms, deadlines and requirements. DHS may make changes to the Purchase Order at any time, and Vendor shall accept such changes. Should Vendor desire to change any product specification or process definition, then Vendor must obtain DHS’s written approval prior to the implementation of the change. Any changes to the Goods (as defined hereafter) shall be negotiated in advance by the Parties and agreed to in writing. If a change causes an increase or decrease in cost and/or time required for performance of the services, an equitable adjustment shall be made and the Purchase Order shall be modified accordingly. If price, terms, shipping date or any other expressed condition of the Purchase Order cannot be achieved or met by Vendor, DHS must be notified as soon as the condition is identified, and must accept in writing any variation prior to shipment or delivery.
2. Prices. Prices or fees for conforming goods, items or services specified in the Purchase Order (collectively, the “Goods”) shall include any applicable transportation charges, insurance costs, shipping and handling fees and any related taxes pursuant to the terms set forth in Section 15.
3. Terms of Payment and Title. Upon Acceptance (as defined hereafter) of the Goods pursuant to Section 6 herein, DHS agrees to pay all amounts due within the terms agreed upon between the parties as stated in the Purchase Order (less any deposits paid to Vendor (if any) unless otherwise agreed to by the Parties in the Purchase Order; provided, however, Vendor shall invoice DHS and DHS shall only be obligated to pay such invoice if issued to DHS subsequent to delivery, receipt and Acceptance of all Goods ordered under the Purchase Order.
4. Delivery of Goods. Vendor hereby agrees to on-time delivery based upon the timeline set forth in the Purchase Order. If the Purchase Order does not specify a delivery date (the “Delivery Date”) or timeline, Vendor shall provide the Goods as if time is of the essence. Changes, modifications or any delay resulting from DHS that prevents Vendor from achieving the Delivery Date shall not constitute a breach of this Purchase Order by Vendor. If Vendor anticipates a delay in the delivery of the Goods, Vendor shall immediately notify DHS. In the event that Vendor fails to deliver the Goods by the Delivery Date, or Vendor fails to deliver conforming Goods, DHS may purchase substitute Goods elsewhere and charge Vendor for any additional expense incurred relating to the purchase of such substitute Goods. Vendor shall deliver all Goods in accordance with the terms of the Purchase Order. If delivery of the Goods is not complete by the Delivery Date, DHS may, without liability, and in addition to its other rights and remedies, terminate the Purchase Order by notice effective when received by Vendor, as to Goods not yet delivered or rendered. Acceptance of any part of the Purchase Order shall not bind DHS to Accept (as defined hereafter) any future shipments nor deprive it of the right to return goods already Accepted (as defined hereafter).
5. Shipping. Vendor shall substantially pack, mark and ship all Deliverables in a manner to secure the lowest, reasonable transportation cost and in accordance with the shipping instructions contained in the Purchase Order and the requirements of common carriers. Vendor shall be liable for any difference in shipping charges arising from its failure to follow the shipping instructions contained herein or properly describe the shipment. The Parties agree to assist each other in the prosecution of claims against carriers.
6. Acceptance. As a condition precedent to payment for the Goods by DHS to Vendor, DHS shall Accept those Goods (in whole or in part thereof) on the Delivery Date or as otherwise set forth in the Purchase Order. For purposes of these Terms and Conditions, “Acceptance” means the point at which DHS accepts the Goods in accordance with the terms set forth in the Purchase Order. Acceptance shall include the terms “Accept” and “Accepted”. The Goods shall be deemed to have been Accepted (i) in the absence of written notification of non-Acceptance by DHS to Vendor within a reasonable period of time, but not less than two (2) business days from the Delivery Date, or (ii) upon timely delivery of the Goods identified herein to the shipping address specified on the face of the Purchase Order. By way of clarification, DHS hereby retains the right to reject any non-conforming Goods and shall not be obligated to Accept any non-conforming Goods.
7. Inspection. Payment for the Goods provided under the Purchase Order shall not constitute Acceptance thereof. DHS may inspect and test such Goods and reject any or all items that are, in DHS's sole judgment, non-conforming. Goods rejected or supplies in excess of quantities ordered may be returned to Vendor at Vendor’s expense. Failure by DHS to inspect and/or test the Goods shall not be deemed Acceptance by DHS. DHS along with its customer and their representatives, and any applicable federal, state or local authorities and/or agencies, retain the right to verify at the Vendor’s premises/related facilities, any and all system, process and product records related to the Purchase Order. The Vendor warrants that product provided meets applicable statutory and regulatory requirements. When a First Article Inspection (“First Article”) is specified on the Purchase Order, the product may not be shipped to DHS unless a copy of the inspection certificate has been provided to DHS stating that the product has met the specifications stated in the Purchase Order. Traceability is a DHS requirement that must be maintained by the Vendor. Vendor is required to immediately notify DHS and request approval in all cases where there are any proposed changes to the product or processes, and of any non-conformances related to the products on the Purchase Order, and obtain DHS’s approval/deviation of any nonconforming product and its repair. If design, tests, examinations inspections and related instructions are involved as part of the verification (as defined in Purchase Order), the vendor shall provide a copy of those documents for approval to DHS. If test specimens (i.e. Production methods, identification and or traceability numbers, storage conditions, etc.) for design approval, inspection, investigation or auditing are required by the Purchase Order, then Vendor is required to comply with those requirements or specifications.
8. Warranty. In addition to Vendor’s standard warranty relating to the Goods, Vendor warrants that the Goods to be delivered pursuant to the Purchase Order (i) are of merchantable quality and free from defects in material or workmanship, (ii) shall conform to all specifications or other descriptions furnished to and approved by the Parties, (iii) comply with all applicable international, federal, state and local laws, rules and regulations (including, without limitation, those concerning health, safety, and environmental standards) which bear upon Vendor’s performance, (iv) shall be new and not refurbished or reconditioned, unless expressly agreed in writing by DHS, and (v) are not restricted in any way by any patents, copyrights, mask work, trademark, trade secrets, or intellectual property, proprietary or contractual right of any third party.
9. Cancellation. DHS may for any reason and at any time, at its option cancel any unshipped Goods. To the extent the Purchase Order covers stock Goods, DHS’s only obligation is to pay for Accepted Products prior to such cancellation. To the extent the Purchase Order covers Goods manufactured or fabricated to DHS’s specifications, Vendor shall immediately cease all performance hereunder upon receipt of notice of cancellation, and, if Vendor is not in default, DHS shall reimburse Vendor for the actual, direct cost to Vendor of such Goods which have, at the time of such cancellation, been wholly or partially manufactured. Upon payment, title to all such Goods shall pass to DHS. Unless DHS shall have otherwise instructed Vendor, Vendor agrees that it will not manufacture Goods in reserve in an amount greater than the number of manufactured Goods that it has shipped to DHS at any one time.
10. Risk of Loss. Vendor assumes all risk of loss of or damage to all Goods ordered and all work in progress, materials, and other items related to the Purchase Order until the same are finally accepted by DHS. Vendor assumes all risk of loss of or damage relating to any Goods, work in progress, materials, and other items rejected by DHS until the same are received by Vendor or Accepted by DHS.
11. Confidentiality. All specifications, documents, artwork, or drawings delivered to Vendor by DHS, and any other non-public information DHS discloses to Vendor, remains DHS's property. The information is provided to Vendor solely for the purpose of Vendor's performance of the Purchase Order and on the express condition that neither the Purchase Order nor the information contained therein or provided in connection therewith shall be disclosed to others nor used for any purpose other than in connection with the Purchase Order without DHS's prior express written consent. DHS reserves the right to request that Vendor return all such information to DHS or destroy it. Vendor's obligations under this paragraph shall survive the cancellation, termination or other completion of the Purchase Order.
12. Indemnification. To the fullest extent permitted by law, Vendor shall indemnify, defend, protect, and hold harmless DHS, its officers, directors, shareholders, board members, representatives, agents, consultants, employees, affiliates, subsidiaries, and their respective successors and assigns (each an “Indemnitee” and collectively, the “Indemnitees”) from and against all claims, losses, liabilities, damages, lawsuits, actions, proceedings, arbitrations, taxes, penalties, or interest, associated auditing and legal expenses, and other costs incurred by Indemnitee(s) (including reasonable attorneys’ fees and costs of suit) (“Indemnified Claims”) arising from Vendor’s: (a) performance of its obligations under the Purchase Order and (b) misrepresentation or breach of any representation, warranty, obligation, or covenant of the Purchase Order. Such Indemnified Claims shall include, without limitation, all direct, actual, general, special, and consequential damages. This Section 12 shall survive termination, cancellation, or expiration of the Purchase Order.
13. Insurance. Vendor shall maintain adequate insurance in any and all forms necessary to protect both Vendor and DHS against all liabilities, losses, damages, claims, settlements, expenses, and legal fees arising out of or resulting from performance of the Purchase Order. Although evidence of certain minimum coverage may be required, nothing contained herein shall abridge, diminish or affect Vendor’s responsibility for the consequences of any accidents, occurrences, damages, losses, and associated costs arising out of or resulting from performance of the Purchase Order.
14. Advertising or Publication. Neither Vendor nor any of its subcontractors or affiliates shall cause or allow the name of “Deep Hole Specialists, LLC” or “DHS” (or any variation thereof) or any DHS logo or mark, or that of any of its subsidiaries, affiliates or employees to be used in any advertising or promotional literature, electronic or otherwise, or in any publication whatsoever, without prior written approval of DHS.
15. Taxes. DHS will not be liable for any taxes with respect to a Purchase Order, except for sales, use, excise, ad valorem, value added, or consumption taxes imposed by any governmental authority for the purchase of the products Vendor supplies, which Vendor is required by law to collect from DHS. Vendor shall not collect or remit, and DHS shall not be liable for, any such taxes if DHS has provided Vendor with a tax exemption certificate. DHS also will not be liable for any taxes of any nature based on the income of Vendor. If DHS is required by the law of any jurisdiction to withhold any taxes, duties, fees, levies, or charges ("Withholding Taxes") from any fees or other charges (including reimbursement of expenses) paid to Vendor, DHS will be entitled to deduct the amount of such Withholding Taxes from the amount of such fees or other charges (including reimbursement of expenses). If Vendor is either exempt from withholding or entitled to a reduced rate of withholding pursuant to a tax treaty or other applicable law, and provides DHS with adequate documentation of such exemption from or reduced rate of withholding, DHS will be entitled to withhold only such Withholding Taxes from which Vendor is not exempt. In case of doubt by DHS as to DHS's liability for any such tax, Vendor shall allow DHS, at DHS's expense, to assume control of any litigation or proceeding relating to the determination and settlement of such tax. DHS shall, upon final settlement of such litigation and proceeding, reimburse Vendor for any tax owing including in the amount to be reimbursed, any interest charges and penalties accruing thereon.
16. Presumptions. Vendor shall be conclusively presumed to have waived Vendor's right to receive payment for products or services covered by any Purchase Order if Vendor has not submitted an invoice for the products or services within one (1) year of the date of the Purchase Order. Vendor's submission of an invoice shall give rise to a presumption that the charges are the full amount Vendor is due for the products or services listed on or referred to in the invoice for the purpose of determining the existence of any underpayment. Vendor may submit supplemental invoices only if accompanied by a photocopy of the original invoice and documentation acceptable to DHS that establishes the validity of Vendor's claim for underpayment. Vendor waives any claim for underpayment if a supplemental invoice and supporting documentation have not been furnished within the earlier of (i) one (1) year after the Delivery Date or performance of the services covered by the supplemental invoice, or (ii) three (3) months after the date of submission of the original invoice.
17. Independent Contractor. Vendor, in the performance of its duties hereunder, shall be an independent contractor only, and not an agent, employee, partner, or joint venturer of, or with DHS, and nothing herein shall be deemed to create or imply any relationship other than that of independent contractor.
18. Non-Waiver. Except as otherwise provided in the Purchase Order, failure by DHS to insist on strict performance of any provision of the Purchase Order, complain of any action, non-action, or default of the other Party, or to exercise any right or privilege, shall not constitute a waiver of any aggrieved Party’s rights hereunder.
19. Severability. If any term, covenant, condition, or provision of the Purchase Order, or the application thereof to any person or circumstance, shall ever be held to be invalid, illegal or unenforceable by a court or judicial officer, the provision shall remain in effect to the extent allowed by law, and in each such event the remainder of the Purchase Order or the application of such term, covenant, condition, or provision to any other person or any other circumstance (other than those as to which it has been deemed invalid or unenforceable) shall not be thereby affected and each term, covenant, condition, and provision thereof shall remain valid and enforceable to the fullest extent permitted by law.
20. Successors and Assigns; Assignment. DHS and Vendor, respectively, bind themselves and their successors, assigns, and legal representatives to the other Party to the Purchase Order and to the successors and assigns of such other Party with respect to all covenants of the Purchase Order. Notwithstanding the foregoing, Vendor shall not subcontract the work or assign the Purchase Order without the written consent of DHS, and any assignment in violation of this Section 20 shall be void and of no effect.
21. Governing Law. The Purchase Order shall be governed by and construed in accordance with the laws of the State of Ohio without regard to its rules of conflict of laws. Each of the Parties hereby irrevocably and unconditionally consents to submit to the exclusive jurisdiction of the courts of the State of Ohio and of the United States of America located in the State of Ohio (the “Ohio Courts”) for any litigation arising out of or relating to this Agreement and the transactions contemplated hereby (and agrees not to commence any litigation relating thereto except in such courts), waives any objection to the laying of venue of any such litigation in the Ohio Courts and agrees not to plead or claim in any Ohio Court that such litigation brought therein has been brought in an inconvenient forum.
22. Force Majeure. DHS may delay delivery, performance, or Acceptance of the Goods ordered hereunder in the event of causes beyond its control. Vendor shall hold such goods or refrain from furnishing such services at the direction of DHS, and Vendor shall deliver the goods when the cause affecting the delay is eliminated. DHS shall be responsible only for Vendor’s direct additional costs incurred by holding the goods or delaying performance of the services at DHS’s request. Causes beyond DHS’s control shall include, without limitation, government action or failure to act where required, strike or other labor trouble, fire or similar catastrophe, and severe weather or other acts of God.
