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Purchase Order Terms and Conditions

PURCHASE ORDER TERMS AND CONDITIONS

PAC WORLDWIDE CORPORATION

PURCHASE ORDER TERMS AND CONDITIONS

DEFINITIONS:  This Order is between PAC Worldwide Corporation (or its affiliate identified on the face of the purchase order) (“Company”) and the vendor identified on the face of the purchase order (“Vendor”) and is governed by these Terms and Conditions.   “Order” means these Purchase Order Terms and Conditions (the “Terms and Conditions”), together with the purchase order (“PO”) to which they are physically or electronically attached, any other documents, exhibits, specifications, or instructions provided by Company.  

ACCEPTANCE: Unless accepted earlier, shipment of any goods (“Goods”) or performance of any services (“Services”) described in this Order constitutes Vendor’s acceptance of this Order (including these Terms and Conditions). This Order may not be modified except in writing signed by an authorized Company representative.  No other terms or conditions contained in any bid, estimate, acknowledgment, invoice, or other communication of Vendor shall in any way modify or supersede any of the terms of this Order or be binding on Company, and Company expressly rejects such terms.  No course of dealing, usage of trade or course of performance shall be used to supplement or explain any term, condition, or instruction in this Order, nor be deemed to amend this Order.  If a preexisting executed contract controls the purchase of Goods or performance of Services (“Existing Contract”) is identified in this Order, if there is any conflict between the terms hereof and the Existing Contract, the terms of such Existing Contract shall control.  This Order any Existing Contract (if applicable) constitute the entire agreement of the parties concerning the subject matter of this Order and supersede any prior or contemporaneous agreements or understandings between the parties concerning the same subject matter.

CHANGES: Company shall have the right at any time prior to delivery of Goods or commencement of Services to modify the PO.  If any such changes cause an increase or decrease in the cost of the Goods or Services, or the time required for performance, an equitable adjustment shall be made in writing by the parties.

QUANTITIES/SCHEDULE: Quantities will be as set forth on the face of the PO.  Timely performance of the Services, and delivery of all Goods to Company’s specified location is of the essence and the Company reserves the right to cancel all or any part of this Order if Goods are not delivered on, or Services are not performed by, the date or dates specified.  Any Goods received after the date specified will be held subject to the Company’s right to reject or direct disposal of all, or any part thereof.  Acceptance of Goods after the date or dates specified for delivery shall not be construed as a waiver of Company’s right to recover for late delivery.  Cure of a nonconforming tender may be made only with the express written consent of the Company.

DELIVERY; TITLE; RISK OF LOSS; INSPECTION: Unless otherwise stated on the face of the PO, Vendor shall be responsible to make all arrangements, and to pay, for the loading and transportation (including insurance, any contract of carriage and, if applicable, exportation, importation and customs requirements) of all Goods to the designated place of delivery.  The price stated on the face of the PO for the Goods includes all such loading and transportation costs and expenses.  Title to, and risk of loss or damage of, the Goods shall transfer from Vendor to Company upon Company’s receipt of the Goods at the final destination indicated on the face of the PO. Company shall have a reasonable time to inspect all Goods at the final destination and all Goods will be subject to acceptance by Company.  Inspections will not relieve Vendor of its obligation to provide Goods that comply in all respects with the requirements in this Order, including the specifications and standards provided by the parties (“Specifications”).  Company will not be required to accept or pay for defective or damaged Goods, overruns or under runs.  In addition, all transportation costs resulting from deviation from shipping instructions and any other costs incurred by the Company because of Vendor’s noncompliance with this Order shall be charged to Vendor.   Company or its representative may, upon reasonable notice to Vendor, perform a verification audit at Vendor’s location(s) where the Goods or Services provided under this PO are manufactured or otherwise originate.   

TERMINATION: (a) Company may terminate this Order or any part thereof for its sole convenience on notice to Vendor.  In the event of such notice of termination, Vendor shall immediately stop all work hereunder. Vendor shall be paid only for conforming Goods/Services accepted prior to notice of termination for convenience. Vendor shall not be paid for any work done after receipt of the notice of termination for convenience, nor for any out-of-pocket costs actually incurred by Vendor solely for supplies/services for production of customized Goods ordered by Company which could reasonably be avoided or mitigated. (b) Company may terminate this Order or any part hereof for cause on notice to Vendor in the event of any default by the Vendor or if the Vendor fails to comply with any term in this Order. Late deliveries, deliveries of products which are defective or which do not conform to this Order, or failure to provide Company, upon request, reasonable assurance of future performance shall all be, without limitation, bases upon which Company may terminate all or part of this Order for cause.  In the event of termination for cause, Company shall not be liable to Vendor for any amounts, other than for conforming Goods/Services delivered prior to termination and which Company elects to retain.

REMEDIES: (a) Vendor shall be liable to Company for any and all damages sustained by reason of Vendor’s breach or default of any obligations hereunder. (b) Company may, at its election, require Vendor to promptly repair, correct or replace Goods or reperform Services, or refund the costs of Goods/Services rejected for nonconformance or defect. Goods rejected, or not promptly corrected or replaced may be returned to Vendor at Vendor’s expense for a full refund of all amounts paid to Vendor and, in addition to Company’s other rights, Company may charge Vendor all expenses of unpacking, examining, repacking and reshipping such Goods. Company may elect to make corrections or replace such Goods/Services in the manner determined by Company, and charge Vendor for the cost incurred by Company in doing so. Goods supplied in excess of 110% of quantities ordered may be retained by Company without compensation to Vendor for such excess. (c) To the extent necessary, Vendor grants Company, its successors, assigns, agents and independent contractors, such rights, licenses and authority as are necessary or appropriate for Company to perform such corrections. (d) All claims for money due or to become due to Vendor shall be subject to deduction or setoff by Company by reason of any counterclaim arising out of this or any other transaction with Vendor. Vendor shall have no rights to deduction or setoff. (e) Company shall be entitled to seek attorneys’ fees for any action brought to enforce this Order.  (f)  The rights and remedies in this Order are cumulative and not exclusive of any other right or remedy that might be available at law or in equity. 

WARRANTY: In addition to, and without limitation of, all other warranties provided or implied at law applicable to the Goods and Services furnished hereunder, Vendor expressly warrants each of the following as to the Goods/Services: (1) Vendor has good, negotiable, clear and free right, title and interest therein; (2) they strictly conform to all Specifications, will be new, meet all requirements under all applicable laws, and will be free from defects in material or workmanship; (3) all labeling will be true and correct in all material respects and be in conformance with applicable law, and that any Goods will be properly packaged, marked, and labeled to protect against damage or loss in shipment and for resale, if applicable; (4) they are merchantable; (5) they are fit for any particular purpose identified by Company to Vendor; and (6) they will conform in all respects to any applicable samples provided to Company.  Further, Vendor warrants that (x) all Services shall be performed in a good, prompt, workmanlike manner, in strict conformance with all conditions and requirements contained in this Order, industry best practices, and all applicable law, and (y) no portion of the Goods/Services, including without limitation, Work Product, will infringe or misappropriate any third party’s rights, including without limitation, intellectual property, ownership, license or other rights. 

Where applicable, Vendor and any party working on its behalf will comply with the rules, regulations and laws of (a) Executive Order 11246 as amended, (b) Section 503 of the Rehabilitation Act of 1973, (c) 38 USC 4212 of the Vietnam Era Veterans Readjustment Assistance Act of 1974, (d) 29 CFR Part 471, Appendix A to Subpart A, (e) 41 CFR 60-741.5(a) (prohibiting discrimination against qualified individuals on the basis of disability, and requires affirmative action by covered prime contractors and subcontractors to employ and advance in employment qualified individuals with disabilities), and (f) 41 CFR 60-300.5(a) (prohibiting discrimination against qualified protected veterans, and requires affirmative action by covered prime contractors and subcontractors to employ and advance in employment qualified protected veterans

Inspection, testing, acceptance or use of the Goods/Services shall not alter or limit the Vendor’s warranties or obligations hereunder, and such warranties (both express and implied) shall survive inspection, testing, acceptance and use. Vendor hereby assigns to Company and makes Company a third party beneficiary of all warranties Vendor owns, or is entitled to assert against third parties in connection with the Goods/Services, which assignment includes a grant to Company of the right to assert such warranties in its own name as assignee of Vendor. Vendor’s warranties shall run to Company, its successors, assigns, customers and users of products sold by Company.

PAYMENT: Except as set forth below, Vendor warrants that prices shown on this Order shall be complete and constitute the entire compensation for the Goods and Services, and unless specifically stated otherwise, includes labor, technical and professional services, materials, overhead, profit, shipping, packaging, labeling, custom duties, storage, insurance, boxing, and crating, transportation and all applicable taxes.  No additional charges of any type shall be added without Company’s express written consent. Other than the prices shown on the face of the Order and any applicable sales or use taxes, Company will not be responsible for any other charges.  Unless otherwise specified in this Order, payment shall be due to Vendor 45 days following the later of Company’s acceptance of the Goods/Services or receipt of Vendor’s correct invoice. If Company disputes the accuracy of an invoice Company will, no later than sixty (60) days following the date of receipt of such invoice, notify Vendor in writing. Vendor shall issue an invoice to Company with each shipment of Goods.  For Services, Vendor shall issue the invoice(s) in accordance with the schedule agreed upon by the parties.  If no schedule has been agreed upon, then Vendor shall issue the invoice upon completion of the Services.  All invoices shall be in the form of invoice approved by Company.  Unless otherwise expressly agreed by the parties, all amounts shall be invoiced in U.S. Dollars.  Company has the right to unilaterally adjust any invoice to reflect the quantity of Goods actually received by Company.  Vendor shall not invoice, and Company shall not be responsible for the payment of, any amounts that are billed more than 90 days past the date of delivery of the Goods or performance of the Services to which such amounts apply.  Each invoice shall be accompanied by all required documentation necessary to support all charges. 

WORK PRODUCT/OWNERSHIP/LICENSE: For purposes of this Order, “Work Product” includes, without limitation, all designs, discoveries, creations, works, devices, masks, models, work in progress, Service deliverables, inventions, products, computer programs, procedures, improvements, developments, drawings, notes, documents, information and materials made, conceived, or developed by Vendor, alone or with others, which result from or relate to the Services. Unless otherwise set forth in the PO, all Work Product shall be the sole and exclusive property of Company.  Vendor agrees, and will cause its approved subcontractors to agree, that all aspects of the Work Product and all work in process in connection therewith are to be considered “works made for hire” within the meaning of the United States Copyright Act of 1976, as amended, or its equivalent in the applicable jurisdiction (“Copyright Act”), and other applicable copyright laws, and that Company is to be the author or exclusive owner of the same.  If any Work Product is deemed not to be “work made for hire” under such Copyright Act or law for any reason, upon creation of such Work Product, Vendor hereby automatically irrevocably assigns, and agrees to assign without further consideration, the copyright in and to all such Work Product. Vendor shall: (a) disclose all Work Product resulting from the Services to Company; (b) to assist Company, at Company’s expense, to secure, perfect, register, apply for, maintain, and defend Company’s proprietary rights or statutory protections in and to the Work Product; and (c) treat all Work Product as Company Confidential Information. To the extent Company or its agents provide to Vendor any information, items or materials (“Company Property”), such Company Property shall remain the property of Company.  Work Product and Company Materials may not be used for or disclosed to any non-party without Company’s prior written consent, other than to Vendor’s subcontractors and agents to the extent required to fulfill this Order.

In the event that the PO expressly provides that Work Product (or any portion thereof) shall not be owned by Company as set forth above, Vendor hereby grants to Company, its customers and end users, at no additional charge, a perpetual, irrevocable, non-exclusive (except as otherwise provided in the PO), assignable, world-wide right and license to such Work Product for the purposes set forth in the PO. 

INSURANCE: In the event that Vendor’s obligations hereunder require or contemplate: (1) receipt and storage of goods owned by Company; or (2) performance of  Services by Vendor’s employees or agents on premises owned or operated by Company or its customers; Vendor agrees that: (A) Vendor shall be solely liable for any claims arising from loss or damage to such Goods while in possession of Vendor or from performance of such work, including but not limited to claims of damage to persons or property; (B) under no circumstances shall persons performing the Services on behalf of Vendor be considered employees of Company; (C) Vendor shall maintain Company’s goods separate from its own goods, and shall not allow any lien or security interest of any third party arising from obligations of Vendor to attach to such goods; (D) Vendor shall maintain all necessary insurance coverage, including but not limited to property, public or general liability and workers’ compensation insurance, to cover claims of damage to Company’s goods or arising from the performance of Vendor or its employees or agents. Vendor’s insurance shall be primary coverage for any loss or damage of Company’s goods, and Vendor waives any right of subrogation of its insurance to coverage held by Company.

INDEMNIFICATION: In addition to, and not in substitution for any warranty obligations of Vendor, Vendor shall indemnify and hold harmless Company, its affiliates and their agents, employees, officers, directors, members/shareholders, affiliates, and customers (“Indemnitees”) from, and defend the indemnitees by counsel reasonably acceptable to Company against, all damages, losses, claims, awards, penalties, liabilities and expenses (including attorneys’ fees and costs, lost profits, consequential and incidental damages, and royalties due or claimed due) arising out of or resulting in any way from any (a) breach of any provision of this Order, (b) act or omission of Vendor, its agents, employees, licensors, or subcontractors in its performance under this Order, (d) claim of infringement or misappropriation of intellectual property rights or of unfair competition by any third party related to the Goods/Services furnished hereunder including any Work Product or other deliverable provided to Company,  (e) claim arising out of the storage of Goods; and (f) the negligence, fraud or willful misconduct of Vendor and subcontractors and the personnel of the foregoing. The obligation to indemnify shall survive the termination of this Order, and the statute of limitations shall not begin to run on such indemnity obligation until after actual notice to Company of a potentially indemnifiable claim. In the event that Vendor does not promptly acknowledge or assume its obligation to indemnify and defend, Company may assume the defense with its own counsel, and the costs of such defense shall be paid by Vendor promptly on demand, which may be made periodically.

LIMITATION OF LIABILITY—STATUTE OF LIMITATIONS:  IN NO EVENT, SHALL COMPANY BE LIABLE TO VENDOR OR VENDOR’S AFFILIATES, OR ANY THIRD PARTY FOR ANY INCIDENTAL, INDIRECT, SPECIAL, OR CONSEQUENTIAL DAMAGES OR LOSS OF PROFITS (WHETHER DIRECT OR INDIRECT) ARISING OUT OF, OR IN CONNECTION WITH, THIS ORDER, WHETHER OR NOT COMPANY WAS ADVISED OF THE POSSIBILITY OF SUCH DAMAGE. COMPANY’S LIABILITY UNDER THIS ORDER SHALL IN NO EVENT EXCEED THE ORDER PRICE FOR THE GOODS/SERVICES OR THE PORTION THEREOF THAT GIVES RISE TO THE CLAIM.  VENDOR MUST COMMENCE ANY ACTION FOR BREACH BY COMPANY HEREUNDER WITHIN 1 YEAR AFTER THE CAUSE OF ACTION HAS ACCRUED. 

CONFIDENTIAL INFORMATION: All information furnished by Company or its affiliates and documents prepared by Vendor for Company or its affiliates in connection with this Order are proprietary and confidential to Company (“Confidential Information”) and shall not be disclosed to any other person, or used for any purpose other than performance of its obligations under this Order unless Vendor obtains prior written permission from Company. Unless otherwise agreed to in writing, Vendor shall not advertise or publish that Company has purchased Goods or received Services from Vendor, nor shall any information relating to the Order be disclosed without Company’s written permission. Confidential Information does not include any information (i) which Vendor lawfully knew without restriction on disclosure before Company disclosed it to Vendor, (ii) which is now or becomes publicly known through no wrongful act or failure to act of Vendor, (iii) which Vendor developed independently without use of the Confidential Information, as evidenced by appropriate documentation, or (iv) which is hereafter lawfully furnished to Vendor by a third party as a matter of right and without restriction on disclosure.

INDEPENDENT CONTRACTORS: Vendor’s relationship with Company is that of an independent contractor.

ASSIGNMENTS AND SUBCONTRACTING: No part of this Order may be assigned or subcontracted by Vendor without prior written approval of Company. Such prior approval, however, shall not release or relieve Vendor of any obligations hereunder and Vendor shall remain primarily liable for the performance of this Order. Company may assign this Order.

MICSELLANEIOUS: Company’s failure to insist on performance of any of the terms or conditions herein or to exercise any right or privilege or Company’s waiver of any breach hereunder shall not thereafter waive any succeeding breach, or any other terms, conditions, or privileges. If any provision of this Order shall be deemed to be invalid, illegal or unenforceable, the validity, legality, and enforceability of the remaining provisions shall not in any way be affected or impaired thereby. All warranties, indemnities and confidentiality rights and obligations will survive the termination or completion of this Order. This order shall be governed by the laws of the State of Washington, excluding principles of conflicts of laws and excluding the United Nations Convention on International Sales of Goods. Venue and jurisdiction shall be exclusively in the state or federal courts sitting in King County, Washington, and Vendor hereby irrevocably submits to the jurisdiction of such courts, provided, however, that in the event Company deems it necessary to seek injunctive or other relief that, in Company’s sole judgment, can best be awarded in another tribunal or jurisdiction where Vendor may be found, Company shall have the right to seek relief from such tribunal or jurisdiction.