Purchase Order Terms & Conditions:

1. PRICES-Seller represents that the price to be charged for the items covered by this purchase order will not exceed prices charged others under comparable conditions, and Seller will forthwith refund any amounts paid by buyer in excess of amounts permitted.

2.  ACCEPTANCE-This purchase order constitutes Buyer’s offer to Seller and becomes a binding contract on the terms set forth herein when it is accepted by Seller by either acknowledgement or performance.  If this order is not accepted within thirty (30) days from date of issuance it shall become void automatically unless this period of time is extended by Buyer, in writing.  No revisions to this order or conditions stated by Seller in acknowledging the same shall be binding upon Buyer if in conflict with terms and conditions contained herein unless expressly accepted in writing by Buyer.  This contract shall be according to the laws of the State of Washington.

3.  INSPECTION-All materials or articles ordered will be subject to inspection and approval by Buyer irrespective of the date of payment therefore.  At Seller’s expense disposal or return all materials not conforming to blueprints and/or specifications.

4.  CHANGES-Buyer reserves the right to make changes relating to this order.  An equitable adjustment of the price shall be made if justified by such charges, Claim for adjustment shall be made within thirty (30) days from the date the change is ordered.  Prices specified on any order accepted by Seller shall not be subject to increase without Buyer’s written consent.

5.  WARRANTIES-Seller warrants that all articles or materials delivered hereunder shall be free from defects in material and workmanship, and that all parts furnished will conform to applicable specifications, drawings, samples and/or other descriptions furnished.  Unless manufactured pursuant to detailed design furnished or approved by Buyer, Seller assumes design responsibility and warrants the item to be suitable for the purpose intended.  The warranties of Seller together with its service warranties and guaranties shall run Buyer and each successive customer.

6.  PATENT PROTECTION-To the extent that the articles or materials delivered hereunder are not manufactured pursuant to designs originated by Buyer, Seller guarantees that the sale or use of any or all articles or materials delivered hereunder or processes used will not  infringe any United States patent and agrees that Seller will save Buyer and its successive customers harmless from any expense, loss, damage, or liability which may be incurred on account of infringement or alleged infringement of patent rights with respect to suck articles, materials, or processes, and that it will at its own expense defend any action, suit, or claim in which such infringement is alleged; provided Seller is duly notified as to such suits or claims and provided, further, that Seller’s indemnity as to use shall not apply to infringement arising from use in combination with other items where infringement would not have occurred from normal use for which the  article was designed, and provided further, Buyer and its successive customers shall have the right to participate in the defense of such actions.

7.  TOOLS AND MATERIALS-Title to and the right of immediate possession of all tooling equipment or materials furnished or paid for by Buyer directly or indirectly for use hereunder shall be and remain in Buyer.  Buyer does not guarantee or warrant the accuracy of any tooling furnished by it.  No such tooling, equipment or materials shall be used in the production of larger quantities than those specified by Buyer or in advance of Seller’s normal production schedule except with Buyer’s express written consent.  Upon the completion or termination of this order, all such properties shall be disposed of as Buyer may direct.  All such property shall be segregated by Seller in Seller’s plant and clearly marked as belonging to Buyer.  If an item fabricated by Seller from material furnished by Buyer is defective due to Seller’s fault or failure to meet specifications, Seller shall reimburse Buyer for all damages sustained.  Seller will be charged for damage to Buyer’s tools beyond normal wear and tear, while in Seller’s possession.  Buyer reserves the right to use of all tooling, which is furnished, acquired or produced especially for use in the performance of this order.  Seller agrees to include a similar provision in all related subcontracts.

8.  INSURANCE AND RISK LOSS-All materials, tooling, models, patterns, drawings, and other personal property belonging to Buyer furnished by Buyer to Seller or otherwise in Seller’s custody or possession shall be at Seller’s risk from loss or damage from any cause.  Seller shall maintain insurance on such items while in Seller’s possession and until delivery to Buyer at any point designated by Buyer.

During the performance of work hereunder, Seller shall be an independent contractor and agrees to indemnify and hold harmless Buyer, it officers, directors, and employees from any loss, cost, damage, expense or liability by reason of property damage or personal injury of whatsoever nature or kind, arising out of or as a result of the performance of such work, or the actions of the Seller or of its employees, subcontractors, or sub-subcontractors; and Seller agrees that it and its suppliers will maintain public liability and property damage insurance in reasonable limits covering the obligations set forth above and will maintain proper workmen’s compensation insurance covering all employees engaged in the performance of said  work.

9.  REPRODUCTION RIGHTS-Buyer does not grant or convey to Seller by virtue of this order (A) any reproduction rights in or to the articles called for hereunder or, (B) any rights to use designs, drawings or other information belonging to Buyer or supplied by or on behalf of Buyer for use in the performance of this order in the production, manufacture or design of any articles or materials for anyone other than Buyer.

10. ASSIGNMENT-No assignment of this order or of any moneys due or to become due thereunder shall be binding upon Buyer until its written consent thereto is obtained.  Payment to assignee of any claim under this order shall be subject to set-off or recoupment for any present or future claim or claims which Buyer may have against Seller.

11. TERMINATION-The termination clause set forth in Section 8-706 of the Armed Services Procurement Regulation, as in effect of the date of this order, is hereby incorporated herein by reference, except that (1) if there is no Government contract number referred to on the  face of this order, the term “the  Government: and its immediately preceding words “and,” “or” or “by,” whenever appearing in said clause shall be deemed deleted and (2) the period for filing claims shall be limited to sixty (60) days following notice of termination.  The provisions of this clause shall not limit or affect the rights of remedies of Buyer stated in other clauses of this order or provided by law in the event of default or breach by Seller.

12,  DEFAULT-If Seller fails to perform or comply with any provisions of this order, Buyer may cancel this order in whole or in part and may consider such failure or non-compliance as a breach of this contract.  Buyer expressly retains all its rights and remedies provided by law in the case of such breach, and no action by Buyer shall constitute a wavier of any such right or remedy,

13. INSOLVENCY-In the event of the institution of any proceedings by or against either party in bankruptcy or insolvency or under any provisions of the Bankruptcy Act or for the appointment of a receiver or trustee or an assignment for the benefit of creditors of either party, the other party may terminate this order without further cost or liability.

14. CONFIDENTIAL-The Seller shall not disclose any detail connected with this order (except for the benefit of Buyer) to any third party without first obtaining the written consent of Buyer.

15. COMPLIANCE WITH STATUTES AND GOVERNMENT REGULATIONS-Seller warrants and certifies that all materials or articles stated hereunder have been and will be produced in compliance with and subject to (A) all applicable federal and state statutes, amendments thereto and regulations issued pursuant thereto, and (B) all applicable orders and regulations of the executive and other departments, agencies and instrumentalities of the United States.

16. EQUAL EMPLOYMENT OPPORTUNITY AND AFFIRMATIVE ACTION COMPLIANCE-Seller warrants that all goods and services sold hereunder shall have been produced, sold, delivered and furnished in strict compliance with all applicable laws and regulations regarding E.E.O. and Affirmative Action, to which they are subjected.

17. No subcontract shall be made with any other party for furnishing any of the completed or substantially completed articles, spare parts, or work herein contracted for, without the approval of Buyer.

18. PAYMENTS-Payments of Seller’s invoice is subject to adjustment for any shortage or rejection.

19. LABOR DISPUTES-Whenever an actual or potential labor dispute is delaying or threatens to delay the timely performance of this order, Seller shall immediately give notice thereof to Buyer.  Such notice shall include all relevant information with respect to such dispute.

20. Title to all materials purchased hereunder may become vested in the United States Government under the terms of our contract

21. CONDITIONS APPLICABLE TO ORDERS PLACED UNDER GOVERNMENT CONTRACTS OR SUB-CONTRACTS-

(A)  AUDIT-Seller’s manufacturing plant and books or such part of any manufacturing plant as may be engaged in furnishing or constructing the articles ordered, shall, at all times, be subject to inspection and audit by any person designated by the head of any executive department of the Government.

(B)  MILITARY SECURITY REQUIREMENTS-If this order involves access to classified matter by Seller, the clause set forth in Section 7-104.12 of the Armed Services Procurement Regulation as in effect on the date of this order is hereby incorporated herein by this reference to the extent required by said clause, except that the term “the Contractor” as used therein shall mean Seller.

(C)  NON-DISCRIMINATION-     (a) In connection with the performance of work under this order, the Seller agrees not to discriminate against any employee or applicant for employment because of race, religion, color or national origin.  The aforesaid provision shall include but not be limited to the cruitment advertising; layoff or termination; rates of pay or other forms of compensation; and selection of training, including apprenticeship.  The Seller agrees to post hereafter in conspicuous places, available to employees and applicants for employment, notices to be provided by the Contracting Officer setting forth the provisions if the nondiscrimination clause.

     (b) The Seller further agrees to insert the foregoing provision in all subcontracts hereafter, except subcontracts for standard commercial supplies or raw materials.

(D) BUY AMERICAN ACT-Seller shall comply with the Buy American Act (41) U.S.C. Sec. 10-a-d) to the extent required under the determinations issued by the Secretary of the department which issued the Government contract noted on this order.

(E) WALSH-HEALEY ACT AND EIGHT HOUR LAW OF 1912-Seller agrees to comply with the applicable provisions of the Walsh-Healey Act (41 U.S.C. 35-45) and the Eight Hour Law of 1912 and agrees to indemnify Buyer against any damages by reason of violation of this paragraph.

(F) COVENANT AGAINST CONTINGENT FEES-Seller warrants that he has not employed any person to solicit or secure this order upon any agreement for a commission, percentage, brokerage or contingent fee.  Breach of this warranty shall give Buyer the right to annul this order, or in its discretion, to deduct from the agreed price or consideration the amount of such commission, percentage, brokerage or contingent fees.  This warranty shall not apply to commissions payable by Seller upon orders or sales secured or made through bona fide established commercial or selling agencies maintained by Seller for the purpose of securing business.

(G) PATENTS, PATENT RIGHTS AND COPYRIGHTS-

     (1)  If this order or any data furnished to Seller is classified, Seller agrees to abide by the  “Filing of Patent Applications” clause in Sections 9-106 and 9-106.1 of the Armed Services Procurement Regulation as in effect on the date of this order, or as the same may be hereinafter amended, and such clauses shall be deemed incorporated herein by this reference.

(H)  RENEGOTIATION-This order shall be subject to any act of Congress providing for its renegotiation and shall be deemed to contain all the provisions required by any such act.  Seller agrees to insert a like provision in all subcontracts, as defined and with the exceptions specified in the Renegotiation Act of 1951 (P.L.9, 82^nd Congress), as amended.

(I) LIMITATION OF PROFIT-Seller warrants that as far as same may be applicable hereto, it will comply with the Vinson-Trammel Act (34 U.S.C 496 and 10 U.S.C. 311) relating to profit limitations on certain Government contracts and subcontracts, and with all other statutes, rules and regulations on the subject.

(J)  Seller agrees that the Comptroller General of the United States or any of his duly authorized representatives shall, until the expiration of three years after final payment under this purchase order, have access to and the right to examine any directly pertinent books, documents, papers and records of the Seller involving transactions related to this order.

22. CONDITION APPLICABLE TO ORDERS PLACED WHERE A DMS CERTIFICATION IS SPECIFIED-Seller is required to follow the provisions of DMS Regulation 1 and of all other applicable regulations and orders of BDSA in obtaining controlled materials and other products and materials needed to fill this order.