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Terms and Conditions of Purchase
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STANDARD TERMS AND CONDITIONS OF PURCHASE

Each purchase order issued by American Excelsior Company ("AEC") shall be subject to the terms and conditions set forth below, together with the written information contained in each purchase order, all attachments and exhibits, and all specifications, drawings, notes, instructions, and other written materials and information referenced therein (collectively the "Agreement"). The Agreement shall apply to the purchase of the products and/or services described in each purchase order issued by AEC from the vendor or seller named in the purchase order ("Seller"). This Agreement constitutes the entire and integrated agreement between AEC and Seller with respect to the purchase of the products and/or services described in each purchase order and supersedes all prior oral and written communications and agreements related to each purchase order; provided, however, if a written fully executed purchase agreement exists between Seller and AEC with respect to the products and/ or servicescovered by a purchase order and such purchase agreement is valid and in full force and effect as of the date of issuance of a purchase order, the terms of such separate purchase agreement shall prevail over any inconsistent items contained in this Agreement.

1. ACCEPTANCE

Seller’s acknowledgement of each purchase order or commencement of performance under each purchase order shall constitute Seller’s acceptance of this Agreement. Except as expressly provided herein, no term or condition of this Agreement may be amended or deemed to be waived, except by a writing signed by AEC and Seller and clearly understood by AEC and Seller to be an amendment or waiver of this Agreement.

AEC's acceptance of the products or services delivered by Seller pursuant to a purchase order shall not constitute AEC's acceptance of Seller’s terms and conditions set forth on any bill of lading, packing slip, quote, invoice, or other receipt issued by Seller.

2. SHIPMENT AND DELIVERY

2.1 Time is of the essence for each purchase order under this Agreement. If only a portion of the products specified in the purchase order is available for shipment to meet the delivery date specified in the purchase order, Seller shall, unless AEC instructs otherwise, (i) ship the available products in time to ensure timely delivery, and (ii) ship, at Seller’s own costs, the remaining portion of the products as soon as such products become available to Seller.

2.2 Seller shall use diligent efforts to deliver the products and/or services ordered by AEC no later than the delivery date specified in the purchase order. If, not due to any fault of AEC, the specified mode of transportation would not permit Seller to meet the delivery date, Seller shall ship such products by air freight or other expedient means acceptable to AEC, and Seller shall pay the cost of freight for such expedited shipment over the cost of the specified mode of transportation. If Seller fails to deliver the products and/or services ordered by AEC on or before the delivery date, then AEC may terminate the purchase order.

2.3 If the products and/or services ordered by AEC are in excess of the amounts stated on the purchase order or are delivered more than three (3) work days prior to the delivery date, AEC may either reject such products and/or services and return the shipment to Seller, at Seller's expense, or accept the products and/or services pursuant to Section 4 below. Such shipments will be held at Seller’s risk and expense including reasonable storage charges while awaiting Seller’s shipping instructions. Return shipping charges will be at Seller’s expense. Material for which return shipping instructions are not received within a reasonable time may be destroyed or sold by AEC at public or private sale and the proceeds, if any, applied toward storage charges.

2.4 AEC’s return shipment to Seller of any of the following products shall be at Seller’s own risk and expense, including, without limitation, transportation and insurance charges: (i) products that do not meet the warranties specified herein; (ii) products that are not accepted by AEC pursuant to Section 4 below; (iii) products that constitute over shipments or early shipments by Seller; and (iv) Seller’s shipment to AEC of all replacement and reworked products to replace nonconforming products (transportation and insurance charges for replacement or reworked products shall include round trip shipment).

2.5 Seller shall preserve, pack, package, and handle the products ordered by AEC so as to protect the products from loss or damage and in accordance with good commercial practice and AEC's specifications. Seller shall be liable for and shall promptly refund to AEC the amount of any loss or damage due to Seller’s failure to properly preserve, pack, package, or handle such products.

2.6 Seller shall include with each shipment of products a packing list that sets forth AEC's reference number of the purchase order, the part number of each of the products shipped, a description and the quantity of each of the products shipped, and the date of shipment. The purchase order numbers shall be plainly visible on all invoices, packages, bills of lading, and shipping orders provided by Seller. Payment of invoices shall not constitute acceptance of products by AEC and shall be subject to adjustment for errors, shortages, defects in the products, or other failure of Seller to meet the requirements of this Agreement.

2.7 Unless otherwise expressly provided herein, all products delivered to AEC shall be FCA Seller's facility at the address set forth in the purchase order without charge to AEC for crating or storage. All customs, duties, costs, taxes, insurance premiums, and other expenses relating to such transportation and delivery shall be at Seller’s sole cost and expenses.

2.8 Seller shall not, without AEC's prior written consent, commence to manufacture, assemble, configure, or procure any of the products specified in the purchase order in advance of Seller’s normal lead time for such products. In the absence of AEC's prior written consent, AEC shall not be obligated, in any event of termination or a change of the purchase order, with respect to any products manufactured, assembled, configured, or procured in advance of Seller’s normal lead time for such products

3. PRICE

3.1 Seller represents and warrants to AEC that the prices for the products and/or services provided under the purchase order are the lowest prices for which Seller has sold or is selling such products and/or services, taking into account any differences in quantities, schedule, and other material terms. AEC shall be entitled to receive from Seller any price reduction that Seller makes to others for comparable products or services as of the later of: (i) the delivery date for the products and/or the date upon which Seller is to begin performing the services under the purchase order, (ii) the date of actual delivery of the products and/or date upon which Seller commences the services under the purchase order, or (iii) the date that an acceptable invoice for the products and/or services is received by AEC.

3.2 All payments due under the purchase order to Seller shall be paid to Seller in United States dollars (unless another currency is specified in the purchase order) not later than forty-five (45) days following: (i) the delivery date, (ii) the date of AEC’s acceptance of all of the products and/or services under the purchase order, or (iii) AEC’s receipt of a properly prepared invoice, whichever is later, pursuant to properly prepared invoices accompanied by certifications of conformance of the products to the requirements under this Agreement, if applicable. AEC may at any time set off any amount owed by AEC to Seller against any amount owed by Seller or any of its affiliated companies to AEC.

3.3 AEC will pay all sales and use taxes, excise taxes, withholding taxes, shipping and handling fees, and other governmental charges relating to the sale, delivery, or shipment of the products to the extent specified in the purchase order. If no such charges are specified in the purchase order, Seller will notify AEC not less than ten (10) days prior to the delivery date, in writing, setting forth all such charges for AEC's prior approval; otherwise Seller acknowledges and agrees that Seller will pay, without charge to AEC, all charges. Seller agrees to reimburse AEC for any such charges that AEC by law may be required to pay on behalf of Seller.

4. INSPECTION/ACCEPTANCE

4.1 AEC, or its designated representatives, shall have the right to inspect and test the products or services ordered under each purchase order at any time prior to delivery and to finally inspect such products and results of such services within a reasonable time after delivery to AEC of such products and/or completion of Seller’s obligations. The products or services shall not be deemed accepted by AEC until after such final inspection and testing by AEC and AEC's issuance of written confirmation of acceptance. The making or failure to make any inspection of, or payment for, or acceptance of, the products or services shall in no way impair AEC’s right to reject or revoke its acceptance of nonconforming products and services or to seek any other remedies to which AEC may be entitled.

4.2 AEC may reject any portion or all of any shipment of products that does not conform to the applicable specifications or descriptions of the products set forth in the purchase order within sixty (60) days of receipt of such products and may return such rejected products to Seller for, at AEC’s sole option, replacement, refund or credit.

4.3 AEC may accept or reject shipments in accordance with its established lot inspection procedures. Where rejection of a shipment is appropriately based on AEC's normal inspection level, and such rejection endangers AEC's production schedules by reason of the fact that at least some of the products are necessary to meet such production schedules, then AEC at its option may charge Seller for the reasonable costs of an above normal level of inspection up to and including 100% inspection of such shipment.

5. CHANGE ORDERS

AEC may, at any time prior to the delivery date, by a written order, suspend its purchase of products or services under the purchase order or make changes to the purchase order in any of the following: (i) drawings, specifications, or instructions relating to the purchase order; (ii) method of packing or shipment; and (iii) place or date of delivery. AEC shall give written notice of such changes, and in the event that such changes affect the cost of furnishing the products ordered, the price of such products shall be equitably adjusted by mutual agreement of AEC and Seller. Seller shall present claims for adjustment in writing within two (2) days of receiving AEC's request for change, unless AEC agrees in writing to extend the time for Seller's claims

6. WARRANTY

6.1 Seller warrants to AEC and its customers for the longer of Seller’s normal warranty period or for one (1) year following the date of AEC’sacceptance of the products and/or services that (i) when received by AEC from Seller, the products shall be free from defects in design, material, workmanship and manufacture, (ii) the products and/or services will conform to the Seller's published documentation and to the applicable specifications, drawings, samples, or to other descriptions or AEC requirements set forth in the purchase order, (iii) the services will be performed in a professional and workmanlike manner, (iv) the products and/or services will be suitable for the purposes for which the products and/or services are intended if such purposes were made known to Seller, (v) Seller has good, unencumbered title to the products and has conveyed such good, unencumbered title to AEC, and (vi) all products are new and unused, unless otherwise specified by AEC. The foregoing warranties are in addition to all other warranties, whether express or implied, and will survive delivery, inspection, acceptance, or payment by AEC.

6.2 If any of the products or services delivered by Seller do not meet the warranties specified in this Agreement or otherwise applicable, AEC, may, at its option, (i) require Seller to correct any defective or non-conforming products by repair or replacement at no charge to AEC, (ii) return such defective or non-conforming products to Seller at Seller’s expense and recover from Seller all amounts paid therefore, (iii) correct the defective or non-conforming products itself and charge Seller the cost of such correction, (iv) obtain a refund from Seller for all amounts paid for any defective or non-conforming services, or (v) utilize the defective product and require an appropriate reduction in price. The foregoing remedies are in addition to all other remedies at law or in equity or under this Agreement, for damages or otherwise, and shall not be deemed to be exclusive. All warranties shall run to AEC, its successors, assigns, customers, and third parties injured in person or property by any breach thereof.

6.3 AEC’s approval of Seller’s product or design shall not relieve Seller of the warranties set forth in this Section 6, nor shall waiver by AEC of a requirement pertaining to any drawing or specification for one or more of the products constitute a waiver of such requirements for the remaining products to be delivered hereunder unless so stated by AEC in writing. The provisions of this Section 6 shall not limit or affect the rights of AEC under Section 4 hereof, “INSPECTION/ACCEPTANCE.”

7. ASSIGNMENTS

No right or obligation under this Agreement (including the right to receive monies due) may be assigned by Seller without the prior written consent of AEC, and any purported assignment without such consent shall be null and void.

8. TERMINATION FOR CONVENIENCE

8.1 AEC may terminate this Agreement, (or each purchase order of AEC) in whole or in part, at any time, by written, telephone, facsimile or email notice to Seller.

8.2 Upon such termination, Seller will, to the extent and at the times specified by AEC, stop all work under each terminated purchase order, place no further orders for materials to complete such work, if requested by AEC, assign to AEC all of Seller’s rights, title, and interests under terminated subcontracts and orders, settle all claims there under (after obtaining AEC’s prior written approval), protect all property in which AEC has or may acquire an interest, and transfer title and make delivery to AEC of all articles, materials, work in process, and other things held or acquired by Seller in connection with the terminated portion of this Agreement. Seller will proceed promptly to comply with AEC’s instructions respecting each of the foregoing without awaiting settlement or payment of any termination claim it may have against AEC as described in Section 8.3 below.

8.3 Within six (6) months after such termination, Seller may submit to AEC its written claim for termination charges, in the form and with the certifications prescribed by AEC. Failure to submit such claim within such six (6) month period will constitute Seller’s waiver of all claims against AEC and a release of all of AEC’s liability arising out of the termination.

8.4 AEC and Seller may, after conferring with each other in good faith, agree upon the amount to be paid by AEC to Seller for such termination. Absent such agreement, AEC will pay Seller (subject to set off against amounts owed by Seller or any of its affiliated companies to AEC) the following amounts: (i) the price set forth in each terminated purchase order for all products completed or services rendered in accordance with this Agreement to the extent not previously paid for by or credited to AEC; (ii) the actual reasonable costs incurred and paid by Seller that are properly allocable under recognized commercial accounting practices to the terminated portion of this Agreement, plus a fair and reasonable profit on such costs unless Seller would have sustained a loss on the terminated purchase order, in which case no profit will be allowed and an adjustment will be made reducing the amount to be paid by AEC by the projected amount of such loss and (iii) the reasonable actual costs incurred and paid by Seller in making settlement hereunder and in protecting property in which AEC has or may acquire an interest.

8.5 Payments made under Sections 8.3 and 8.4(i) and (ii) above shall not exceed the aggregate price of the products or services specified in terminated portion of this Agreement less payments otherwise made or to be made by AEC. Any amounts payable to Seller by AEC under this Section 8 shall exclude amounts payable to AEC by Seller due to property that is lost, damaged, stolen, or destroyed.

8.6 Those rights and obligations which by their nature are intended to survive the expiration or termination of this Agreement (or each purchase order) will survive until the expiration of the applicable statutes of limitations, including, without limitation, Sections 3.3, 4, 6, 8, 9, 10, 11, 12, 14, 15 and 16.

9. OWNERSHIP OF DESIGNS

Seller shall not sell or furnish to any other person, firm or corporation, or except as specified herein or in a separate agreement between Seller and AEC, otherwise use or disclose design specifications or technical information furnished by AEC. All designs, specifications, patterns, blueprints paid for by or charged to AEC shall, unless otherwise expressly stated to the contrary in the purchase order, or in a separate written agreement between Seller and AEC, become the property of AEC immediately upon receipt thereof by Seller, shall be so marked and identified and shall be delivered to AEC upon demand and Seller agrees to maintain these items in first-class order while in Seller's possession or use. Any designs, specifications, patterns, blueprints or other property furnished to Seller by AEC shall be returned to AEC upon delivery in the same manner as received by Seller, ordinary wear and tear excepted.

10. CONFIDENTIAL INFORMATION

Seller agrees that any data designs, specifications and all other business, product, technical and financial information it obtains from AEC are the confidential property of AEC (“Confidential Information”). Except as expressly and unambiguously allowed herein, Seller will hold in confidence and not use or disclose any Confidential Information without AEC’s prior written consent and shall similarly bind its employees, consultants, and subcontractors in writing. Seller shall not disclose any Confidential Information to any person or entity other than those employees, consultants or subcontractors of Seller who have a legitimate need to know. Upon AEC’s request, or upon termination of this Purchase Order, Seller shall promptly return all Confidential Information and any copies thereof to AEC.

11. INDEMNIFICATION

11.1 Seller shall indemnify, defend and hold AEC and its officers, directors, agents, employees, successors and customers (collectively, "AEC and Related Parties") harmless against any and all claims, liabilities, losses, damages, settlements, costs and expenses, (including attorneys’ fees) made against or sustained by AEC arising from the death of or bodily injury to any person or damage to property on account of any alleged or actual defect in any products provided under this Agreement, whether latent or patent, including, without limitation, improper construction or design, or failure to warn or caused by the negligence or willful misconduct of Seller or any subcontractor, agent, employee or consultant of Seller.

11.2 Seller represents and warrants to AEC that there are no claims or liabilities for royalties, liens or any other encumbrances on the products supplied under this Agreement, and Seller shall indemnify, defend and hold AEC and Related Parties harmless against any such claims and liabilities.

11.3 Seller shall indemnify, defend and hold AEC and Related Parties harmless from any and all claims, liabilities, loss, costs, expenses (including attorneys’ fees) settlements or damages out of any actual or alleged violation, misappropriation or infringement of any patent, trademark, copyright, trade secret, or any other proprietary or intellectual property right. If AEC’s use of any of the products is enjoined or, in AEC’s reasonable opinion, is likely to be enjoined as result of any such infringement or alleged infringement, Seller agrees at Seller's expense and at AEC’s option to (i) accept return of the products from AEC and refund to AEC the amounts paid by AEC with respect to such products, or (ii) modify the products so that they become non-infringing but equivalent in functionality, quality, compatibility, and performance, or (iii) procure for AEC and its customers the right to continue using and distributing the products.

12. LIMITED LIABILITY

NOTWITHSTANDING ANYTHING ELSE IN THIS AGREEMENT, ANY PURCHASE ORDER OR OTHERWISE, AEC WILL NOT BE LIABLE WITH RESPECT TO ANY SUBJECT MATTER OF THIS AGREEMENT OR ANY PURCHASE ORDER UNDER ANY CONTRACT, NEGLIGENCE, STRICT LIABILITY OR OTHER LEGAL OR EQUITABLE THEORY FOR (I) ANY INCIDENTAL, INDIRECT, SPECIAL OR CONSEQUENTIAL DAMAGES OR LOST DATA OR LOST PROFITS, (II) ANY AMOUNTS IN EXCESS IN THE AGGREGATE OF THE FEES PAID BY AEC TO SELLER DURING THE TWELVE (12) MONTH PERIOD PRIOR TO THE DATE THE CAUSE OF ACTION AROSE, OR (III) ANY MATTER BEYOND AEC’S REASONABLE CONTROL.

13. WORK DONE AT AEC’S FACILITIES

Seller shall take such steps as may be reasonably necessary to prevent personal injury or property damage during any work that may be performed by any employees, agents or subcontractors of Seller at AEC’s facilities, and Seller shall indemnify and hold harmless AEC from and against all loss, liability, and damages arising from or caused directly or indirectly by any act or omission of such agents, employees, or subcontractors of Seller, and Seller shall secure and maintain such insurance against public liability and property damage and such employee’s liability and compensation insurance as will protect AEC against the aforementioned risks and against any claims under any Worker’s Compensation and Occupational Disease Acts.

14. COMPLIANCE WITH LAWS

Seller agrees that it is solely responsible for compliance with all applicable federal, state or local laws, ordinances, regulations, rules and standards relating to the design, manufacture, labeling, sale and transportation of the product or the performance of services under this Agreement. Seller further will indemnify and hold harmless AEC and Related Parties against any loss, liability, cost, damage, or expense whatsoever (including reasonable attorneys’ fees) incurred by AEC or Related Parties arising from or based on Seller's violation thereof. Upon request, Seller agrees to issue certificates certifying compliance with any laws or regulations as may be applicable to the material, products, or services furnished under this Agreement

15. APPLICABLE LAW

This Agreement and all purchase orders issued by AEC shall be construed in accordance with the laws of the state of Texas without regard to conflict of laws provisions thereof and without regard to the United Nations Convention on Contracts for the International Sale of Goods. The exclusive jurisdiction and venue of any action relating to this Agreement shall be the District Court for Dallas County, Texas or the United States District Court for the Northern District of Texas and each of the parties hereto submits itself to the exclusive jurisdiction and venue of such courts for the purpose of any such action. The rights and remedies provided in this Agreement are in addition to those available to either party at law or in equity. In any action or proceeding to enforce rights under this Agreement, the prevailing party shall be entitled to recover costs and attorneys’ fees.

16. MISCELLANEOUS

Any notice, approval or consent required or permitted under this Agreement shall be in writing and will be deemed to have been given if mailed by registered or certified mail, postage prepaid, or delivered by overnight courier service with tracking capabilities to the respective addresses of the parties as set forth in this Agreement for such other addresses a party may designate by ten (10) days prior written notice. If any provision of this Agreement shall be adjusted by any court of competent jurisdiction to be unenforceable or invalid, that provision shall be limited or eliminated to the minimum extent necessary so that this Agreement shall otherwise remain in full force and effect and enforceable. Any failure by a party to enforce any provision herein or right or remedy available to it on any one occasion shall not be construed as a waiver on any other occasion. The relationship of Seller and AEC is that of independent contractor.

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