Purchase Orders: Terms and Conditions of Purchase

GENERAL PROVISIONS

BY ACCEPTING THIS PURCHASE ORDER, AND/OR PERFORMING HEREUNDER, SELLER AGREES TO COMPLY FULLY WITH THE TERMS AND CONDITIONS OF PURCHASE. ACCEPTANCE OF THIS PURCHASE ORDER IS EXPRESSLY LIMITED TO THE TERMS AND CONDITIONS OF THIS ORDER AND NONE OF THE SELLER'S TERMS AND CONDITIONS SHALL APPLY IN ACKNOWLEDGING THIS ORDER OR IN THE ACCEPTANCE OF THIS ORDER. ACCEPTANCE BY MANGIACOTTI, INC. , OF THE GOODS, SERVICES OR WORK DELIVERED UNDER THIS PURCHASE ORDER SHALL NOT CONSTITUTE AGREEMENT TO SELLER'S TERMS OR CONDITIONS. SELLER MAY NOT SHIP UNDER RESERVATION.

1. Modifications
   Changes, modifications, waivers, additions or amendments to the terms and conditions of this order shall be binding on Mangiacotti, Inc. only if such changes, modifications, waivers, additions, or amendments are in writing and signed by a duly authorized representative of Mangiacotti, Inc..
2. Applicable Law
   The validity, interpretation, and performance of these terms and conditions and any purchase made hereunder shall be governed by the laws of the state from which this order is issued, in force at the date of this order for contracts made and to be performed in such state. Where not modified by the terms herein, the provisions of such state's enactment of Article 2 of the Uniform Commercial Code shall apply to this transaction.
3. Compliance with Law
   Seller agrees that at all times it will comply with all applicable federal, state, municipal and local laws, orders and regulations, including but not limited to those affecting or limiting prices, production, purchase, sale, and use of material. If requested by Mangiacotti, Inc., Seller agrees to timely certify compliance with such laws in such forms as Mangiacotti, Inc. may request.
4. Release of Information
   Neither party hereto shall, without the prior written consent of the other party (which shall not be unreasonably withheld), publicly announce or otherwise disclose, the existence or the terms of this agreement, or release any publicity regarding this Agreement. This provision shall survive the expiration, termination, or cancellation of this Agreement.
   Any knowledge or information which Seller may disclose to Mangiacotti, Inc. shall not be deemed to be confidential or proprietary information and shall be acquired by Mangiacotti, Inc. free from any restrictions as to use or disclosure thereof.
5. Indemnity
   In the event Seller, its officers, employees and agents or any of them enter premises owned, leased, occupied by or under the control of Mangiacotti, Inc. in the performance of or in connection with this order, Seller agrees to indemnify and hold Mangiacotti, Inc., its officers, agents and employees harmless from any loss, cost, damage, or bodily injury (including death) of whatsoever kind or nature arising out of, or incidental to the performance, delivery or installation of this order occasioned in whole or in part by any action or omission of Seller, its employees, officers and agents or any of them. Seller will maintain general comprehensive liability, property damage and automobile liability insurance, including contractual endorsement and products hazards coverage, in reasonable amounts covering the obligations set forth in this order and, upon request, it will provide Mangiacotti, Inc. with a Certificate of insurance indicating the amount of such insurance.
   Seller agrees to defend and indemnify Mangiacotti, Inc. and its customers from and against all claims, Actions, liabilities, losses and costs and expenses arising out of the death or injury to any person, property damage or loss, or economic injury arising out of this order.
6. Waiver
   Any failure of Mangiacotti, Inc. to enforce at any time, or for any period of time, any of the provisions of this purchase order shall not constitute a waiver of such provisions not of Mangiacotti, Inc.'s right to enforce each and every provision.
7. Acceptance and Warranty
   Final acceptance of material by Mangiacotti, Inc. will not be until after arrival at the Mangiacotti, Inc. facility from which this order originates, unless otherwise specified herein. Seller warrants that all articles, material and work supplied by Seller under this order conform to the requirements, specifications, drawings, samples or other descriptions furnished or adopted by Mangiacotti, Inc. and that they are of good material and workmanship and free from all defects in manufacture or design, and are of merchantable quality and fit for their intended purpose. Such warranties by Seller shall run to the benefits of Mangiacotti, Inc., its employees and purchaser's from Mangiacotti, Inc.. Mangiacotti, Inc.'s approval of designs furnished by Seller shall not relieve Seller of its obligation under this warranty. Seller's warranty shall be effective for a period of four years from the date of acceptance of goods by Mangiacotti, Inc., or for such longer period as specified by Mangiacotti, Inc.. All articles and material returned to Seller for breach of warranty hereunder shall be at Seller's expense, including expenses and penalties incurred by Mangiacotti, Inc. in recalling such articles and materials which have been delivered to Mangiacotti, Inc.'s customers and expense of redelivery. Seller agrees that shipment of materials against this P.O. constitutes certification that all articles or goods included in this shipment conform in all respect to the applicable requirements, specifications, and drawings. Seller will make process control data, inspection, and test reports covering the articles or goods and their parts available for review and subject to examination by Mangiacotti, Inc. or its authorized representative to verify conformance to such applicable specifications and drawings. However, a certificate of conformance must accompany individual shipments when so specified on applicable drawings, or on the front of this purchase order. Any articles or materials not accepted by Mangiacotti, Inc. may be retured to Seller at Seller's expense for full credit of the purchase price. Inspection may be performed at Mangiacotti, Inc.'s option on a statistical sampling basis. The entire lot may be rejected based on defects revealed by such sampling. At Mangiacotti, Inc.'s option, the rejected lot will be either returned to the Seller for replacement or credit or 100% screened by Mangiacotti, Inc. with cost of screening paid by Seller. The initial inspection performed at Mangiacotti, Inc. on receipt of material is a conditional acceptance, and shall not waiver the right of Mangiacotti, Inc. to return material to Seller which exhibits or develops defects due to latent causes during or after assembly or testing of the end product.
   
   Seller shall preserve all special drawings, dies, patterns, tooling or other items supplied or paid for by Mangiacotti, Inc. in good condition; and they are the property of Mangiacotti, Inc. unless otherwise specified, and the same such items shall be returned in good condition when the work on the order has been completed or terminated, or at any other time as requested by Mangiacotti, Inc.. No special drawing, die, pattern, tool or other item supplied by Mangiacotti, Inc. or made by Seller for the use of or delivery to Mangiacotti, Inc., or for use by Seller in supplying Mangiacotti, Inc., shall be used by Seller for any purpose other than supplying Mangiacotti, Inc., without Sellers first obtaining the written consent of Mangiacotti, Inc. thereto. If material, equipment, special drawings, dies, patterns, or other items are furnished by Mangiacotti, Inc. for performance of this purchase order, all risk of loss thereof or damage thereto shall be upon Seller from the time of shipment to Seller until redelivery to and receipt by Mangiacotti, Inc..
8. Patents and Copyrights
   Seller agrees to indemnify and to save Mangiacotti, Inc., its officers, agents, employees, and vendees (mediate and immediate) harmless from any and all loss, expense, damage, liability, claims or demands either at law or in equity for actual or alleged infringement of any patent invention, design, trademark, or copyright arising from the purchase, use or sale of materials or articles required by this purchase order, except where such infringement or alleged infringement arises by reason of designs for such materials or articles originally furnished to Seller by Mangiacotti, Inc..
9. Changes
   Mangiacotti, Inc. may change from time to time any of the drawings, specifications or instructions for work covered by this purchase order and Seller shall comply with such change notices. If such changes result in a decrease or increase in Seller's cost or in the time for performance, and adjustment in the price and time for performance may be made by the parties in writing, provided, however, that Seller notifies Mangiacotti, Inc. of the request for such adjustments within thirty (30) days after receipt by it of the change notice.
10. Assignments
    Performance obligations shall not be assigned or transferred by Seller without prior written approval by Mangiacotti, Inc., and any attempted assignment or transfer without such consent shall be void. Seller shall not subcontract any substantial portion of the work to be performed by it under this order without the prior written consent of Mangiacotti, Inc..
11. Termination
    Mangiacotti, Inc. may terminate the work to be performed hereunder in whole or in part at any time without cause by written notice to seller. Such notice shall state the extent and effective date of such termination and, upon the receipt of such notice, Seller will comply with the directions pertaining to work stoppage hereunder and the placement of further orders or subcontracts hereunder. The parties shall thereupon employ their best efforts to agree by negotiation, within three (3) months upon the amount of reimbursement, if any, to be paid to Seller for such termination. Termination under this provision shall not be deemed a breach of contract. The provisions of this paragraph shall not limit or affect the right of Mangiacotti, Inc. to terminate this order for cause and shall not apply to a termination with cause. Seller shall mitigate its claim to the maximum extent, and in any event no claims shall exceed the lesser of fair market value or actual cost of raw materials and work in progress material which Seller shows cannot be diverted to other uses. No claim shall be asserted or honored for loss of expected profits, or for any consequential or incidental damages, due to cancellation.
12. Price Adjustment
    Mangiacotti, Inc. will not accept shipment at any increase in price above that indicated on this order. Any general price decrease announced by Seller in classification of equipment and/or materials similar to the items described on this order shall automatically reduce the price thereof by a comparable percentage.
13. Notice of Labor Disputes
    Whenever any actual or potential labor dispute delays or threatens to delay the timely performance of this order, Seller shall immediately give notice thereof to Mangiacotti, Inc. and, if the order relates to a military contract, Seller will also give notice to the nearest military representative.
14. Terms
    The following terms with respect to payment are applicable to this order:
    1. Net Invoices
       Net invoices dated within a seven day week ending on a Saturday will be paid on the Fourth following Friday.
    2. Discounted Invoices
       Discounted invoices dated within a seven day week ending on a Saturday will be paid the second following Friday. Invoices that specify a discount for tenth prox payment will be paid on the second Friday of the month following the date of the invoices. The acceptance of minimal discount offers will be at the discretion of Mangiacotti, Inc..
    3. All schedules of payments above stated are based upon receipt by Mangiacotti, Inc. or shipment f.o.b. source, whichever is applicable as indicated on the face hereof, of the goods or services prior to scheduled payment date. If Mangiacotti, Inc. receives the invoice prior to such shipment or receipt of goods or services, the foregoing terms on this order shall be measured from date of such receipt of shipment of goods rather than date of receipt of invoice.
    4. Invoices must be imprinted, where applicable, with the nine digit D-U-N-S number where available, corresponding to the address where payment should be mailed and payment shall be sent to such address.
       
       
15. Extra Charges
    No charges of any kind, including charges for boxing or cartage, will be allowed unless specifically agreed to by Mangiacotti, Inc. in writing. Pricing by weight, where applicable, covers net weight of material, unless otherwise agreed.
16. Time of Delivery
    The delivery dates indicated by Mangiacotti, Inc. for the articles, material or work to be supplied under this purchase order are of the essence. Failure to meet agreed upon delivery shall be considered a breach of the contract; furthermore, Seller agrees to pay to Mangiacotti, Inc. any penalty and damages imposed upon or incurred by Mangiacotti, Inc. for failure of Seller to deliver articles, materials, or work on such delivery dates.
    
    Unless otherwise agreed in writing, Seller shall not make commitments for material or production in excess of the amount or in advance of the time necessary to meet Mangiacotti, Inc.'s delivery schedule. It is the Seller's responsibility to comply with this schedule, but not to anticipate Mangiacotti, Inc.'s requirements. Goods shipped to Mangiacotti, Inc. in advance of schedule may be returned to Seller at Seller's expense. Mangiacotti, Inc. may reschedule the delivery of any unshipped product for later delivery within ninety (90) days of the originally scheduled delivery date.
17. Setoff
    Mangiacotti, Inc. shall be entitled at all times to setoff any amount owing, for any reason, at any time, from Seller to Mangiacotti, Inc. of any of its affiliated companies against any amount payable at any time by Mangiacotti, Inc. in connection with this order.
18. Sales and Use Tax Exemption
    It is hereby certified that the above described property is exempt from the sales and use tax, unless otherwise noted for the reason that such property is purchased for resale or will become an ingredient or component part of, or be incorporated into, or used or consumed in, a manufactured product produced for ultimate sale at retail. If the property described on this purchase order is purchased tax exempt and subsequent use makes this property taxable, Mangiacotti, Inc. will access and pay tax to the appropriate state.
19. Reservation of Rights
    Mangiacotti, Inc. expressly reserves all rights and remedies which are available to it at law or equity, including but not limited to rights and remedies set forth in the Uniform Commercial Code.
20. Attachments
    Any attachments referenced on the front side of this order shall be deemed for all purposes to be an integral part of this order. In the event of irreconcilable conflict between such referenced attachments and the terms stated herein, the terms of such contracts shall control.
21. Overshipments
    Seller is instructed to ship only the quantity(ies) specified in this order. However, any deviation caused by conditions of loading, shipping, packing, or allowances in manufacturing processes may be accepted by Mangiacotti, Inc. according to the overshipment allowance indicated on the face of this order. If no allowance is shown, it shall be 0% (zero percent). Mangiacotti, Inc. reserves the right to return any overshipment in excess of the allowance at the Seller's expense.
22. Packing and Shipping Instructions
    Seller agrees to insure that shipments are properly packed and described in accordance with Mangiacotti, Inc. specifications and/or applicable carrier regulations. Shipments will be made at the lowest freight charges. Mangiacotti, Inc. may assist Seller by providing freight classifications or classifying material. Seller will not insure or declare value on shipments, expect on parcel post, unless Mangiacotti, Inc. specifies otherwise. On shipment where value is declared, Seller will ship prepaid insured for $50 to facilitate tracing. When shipping via small parcel, Seller will ship freight collect if available, otherwise Seller will ship freight prepaid. Seller shall consolidate air and surface shipments daily on one bill of lading per mode to avoid premium freight costs, unless instructed otherwise by Mangiacotti, Inc.. In case of any shipment that does not correspond to normal past practice between Mangiacotti, Inc. and Seller, or to standard practice in the industry, (e.g., requires special handling equipment or air ride suspension, or air shipment over 500 pounds, or over 120 inches long or wide, or over 56 cubic feet, etc.) Seller agrees to notify Mangiacotti, Inc.'s appropriate traffic department 72 hours prior to shipment for special shipping instructions. All truck shipments must be classified by Seller using the current "National Motor Freight Classification Tariff". Each box, crate or carton will show Mangiacotti, Inc.'s full street address (not just post office box numbers) and purchase order and item numbers regardless of how shipped. On small parcel shipments, a packing list shall accompany each container and shall describe the contents of that container. On other shipments, Seller will provide a packing list to accompany each shipment, referencing the appropriate purchase order and item number. The bill of lading also will reference the purchase order and item number. Seller is responsible for packing any shipment correctly based on the carrier/mode utilized. Charges for packing and crating shall be deemed part of the purchase price, and no additional charges will be made therefor unless specifically requested by Mangiacotti, Inc. on the purchase order. Seller agrees to ship via the carrier specified by Mangiacotti, Inc.. Failure to ship via Mangiacotti, Inc. specified carrier will subject Seller to misroute debit.
    
    All premium freight cost incurred by Mangiacotti, Inc. or Seller beyond that specified by Mangiacotti, Inc. shall be borne by Seller. Seller is responsible for all shipments which are damaged in transit due to improper packaging, improper judgment or any other act or omission of the Seller, shipper, or carrier. On all F.O.B. origin shipments, except Parcel Post, Seller will ship freight collect. (If small parcel carrier collect is unavailable, Seller will ship prepaid).
    
    Definition of Terms (Whether F.O.B. origin or destination).
    1. "Freight collect" Seller will ship freight collect - freight carrier will bill Mangiacotti, Inc..
    2. "Freight prepaid charge back" - Seller will ship freight prepaid and bill Mangiacotti, Inc..
    3. "Freight prepaid" - Seller will ship freight prepaid and bear all transportation costs.
23. Returns
    Defective material shall be returned freight collect to Seller. Replacement material shall be sent freight prepaid from Seller, who will absorb the burden of premium transportation when defect or replacement material places critical time or delivery schedule constraints on Mangiacotti, Inc..
24. Inspection - Quality System
    1. The seller agrees to permit Mangiacotti, Inc. and Mangiacotti, Inc.'s customer, to verify the quality of supplies and services being provided under this purchase order at any production stage in the Seller's facility. Verification may consist of a physical assessment/surveillance of the Seller's facilities and quality programs and/or a source inspection. Deficiencies identified during such verification shall be positively corrected by the supplier in the most expeditious manner possible. The Seller shall provide all reasonable facilities and assistance for the safety and convenience of personnel engaged in such verification. Seller agrees to include into each subcontract seller might make hereunder appropriate provisions to the same effect.
    2. Unless modified by the Purchase Order through the use of Mangiacotti, Inc.'s P.O. clauses, Seller is required to ensure that the manufacturing processes used meets the technical requirements of the applicable drawings, specifications, engineering changes, and added requirements of the purchase order. An inspection system inherent to verifying the technical requirements must be maintained and objective evidence of such will be produced on request.
25. Seller Ownership Change
    Seller is required to submit immediately in writing to Mangiacotti, Inc. notification on the following change conditions,
    1. Acquisition by or merger with any other interest;
    2. Majority or controlling interest obtained by another interest.

EXHIBIT A

ARBITRATION SUPPLEMENT

1. If the seller has a dispute with Mangiacotti, Inc. that cannot be resolved through an informal dispute resolution process, the seller and Mangiacotti, Inc. have agreed to arbitrate all disputes.       Arbitration means seller and Mangiacotti, Inc. will have a fair hearing before a neutral arbitrator instead of in a court by a judge or jury.

2. By participating in arbitration, resolution may result in limited discovery depending on the rules of the arbitration organization selected to resolve the dispute.

3. As the first step in the arbitration process, seller will select an arbitrator to preside over seller’s dispute with Mangiacotti, Inc..

4. If there exists a conflict between the rules provided for in the Agreement between seller and Mangiacotti, Inc. and the rules of the arbitration organization seller elects, the rules contained in the Agreement shall govern. Unless there is such a conflict, the arbitrator will be selected and conduct the proceedings in accordance with the rules of the service that is elected to arbitrate the dispute.

5. The location of the arbitration proceeding will be within the state of Massachusetts.

6. The arbitrator will apply applicable statutes of limitation (as modified by the Agreement), will honor claims of privilege recognized by law and will take reasonable steps including the use of protective orders to prohibit disclosure outside the arbitration, if requested to do so by seller or Mangiacotti, Inc..

7. The arbitrator will make any award in writing, but need not provide a statement of reasons unless requested by a party.       Upon a request by seller or Mangiacotti, Inc., the arbitrator will provide a brief statement of the reasons for the award. An award rendered by the arbitrator may be entered in any court having jurisdiction over the parties.

8. In the event that a court were to determine that the arbitration provision found in the Agreement is unenforceable for any reason, seller and Mangiacotti, Inc. have each agreed to waive, to the fullest extent allowed by law, any trial by jury.