TERMS OF MANUFACTURE
1. Entire Agreement. These Terms of Manufacture, combined with the conditions specified in the quotation, represent the entire agreement between SEASON COMPONENTS COMPANY LIMITED (Hereinafter referred to as “SEASON”) and the Customer for purchase orders placed by the Customer and accepted by SEASON, unless superceded by a further agreement signed by both parties. Any additional or different terms and any pre-printed terms in any Customer purchase order or other written communication will have no legal effect unless agreed to in writing by SEASON. Terms in SEASON’s quotation may supersede specific terms in these Terms of Manufacture. In issuing a purchase order to SEASON, Customer agrees to be bound by these Terms of Manufacture. SEASON will provide manufacturing services, as specified in the purchase orders issued by Customer and accepted by SEASON, for the products, which are based on design, technology and materials (“Products”) as agreed to by SEASON and the Customer.
2. Delivery and Acceptance. SEASON will use its reasonable efforts to meet Customer delivery requirements. SEASON will not be liable for any costs or expenses that might be incurred by the Customer as a result of a delay in delivery. Products will be delivered Ex Works (Incoterms 2010) SEASON’s premises. SEASON transfers title and risk of loss to the Products upon delivery irrespective of whether or not SEASON has arranged for transportation according to Customer instructions. Customer agrees to carry adequate insurance until such time as the Products are paid for in full. Subject to the warranty provisions of Section 7, Customer may reject Products that are proved, to SEASON’s reasonable satisfaction, not to meet the relevant mutually agreed to specifications or, to have been materially damaged prior to delivery by SEASON. In such an instance, Customer will notify SEASON in writing within ten (10) calendar days of original delivery and request a return material authorization (RMA). Once an RMA is issued, Customer shall have five (5) calendar days to return rejected Products to SEASON, at Customer’s risk and expense. Subject to the warranty provisions of Section 7, SEASON will then, at its election and cost, repair, replace or credit Customer for the rejected Products. In the case of replacement, title to rejected Products shall pass to SEASON upon delivery to SEASON. In the absence of earlier notification of rejection, Customer will be deemed to have accepted Products ten (10) calendar days after delivery.
3. Prices and Payment. Pricing is as indicated in the quotation. The Customer will be solely responsible for and will pay all taxes, including value-added taxes, duties or other governmental or regulatory charges. Unless otherwise stated, all prices refer to U.S. dollars and payment is due, without any set-off or deduction, thirty (30) days from date of invoice. If the Customer fails to make full payment by the due date SEASON may, in addition to its other rights and remedies, apply an annual late payment charge at the rate of two (2) percent per month, or if lower, the maximum interest rate permitted by law.
4. Purchase Orders/Forecasts. Except as otherwise agreed to by the parties in writing, the Customer authorizes SEASON to schedule production, purchase materials, including long lead-time items and unique components, to fulfill purchase orders, forecasts and, if applicable, upside requirements, based on material lead times, supplier minimum requirements and economic order quantities. Customer will be liable for all such materials in the event of a cancellation of a purchase order, reduction of forecast or other obsolescence. An order may be rescheduled once from its originally scheduled ship date but for no more than sixty (60) days from the original date. No order may be rescheduled within the thirty (30) day period immediately preceding its scheduled ship date. For blanket purchase orders, rescheduling applies to each date designated on the purchase order. The Customer is responsible for carrying charges and for costs incurred by SEASON associated with such rescheduling, which cannot be mitigated by the reasonable efforts of SEASON in accordance with Section 6 herein. Any order that has been rescheduled may not be subsequently cancelled. If Customer cancels in whole or in part any purchase orders, Customer will pay SEASON: a) the full Product price for any finished Products or work in process, and b) for any costs associated with materials on hand or on order, which cannot be mitigated by the reasonable efforts of SEASON in accordance with Section 6 herein, and c) for any investment incurred by SEASON with the prior agreement of the Customer, and d) the pro-rated portion of the price of the cancelled orders which relates to SEASON’s value-add. Except in accordance with Section 2 above, refusal to accept delivery of an order will be treated as a cancellation.
5. Order Changes, Engineering Changes, and Specification. Any requested changes to purchase orders placed by the Customer are subject to acceptance in writing by SEASON. For all engineering changes except those initiated by SEASON solely to improve its manufacturing processes, the Customer will be responsible for all costs associated with implementation, including if applicable, excess and/or obsolete inventory. Customer shall defend and indemnify SEASON against any infringement of intellectual property arising from use of a Customer provided design or specification. Unless otherwise agreed by SEASON, Customer shall be solely responsible for compliance with any product content requirements including those related to conflict minerals and environmental concerns, laws, directives, and regulations.
6. Obsolete and/or Excess Material and Inventory. If for any reason, and at any time, material and/or inventory procured pursuant to this agreement and the related Product is rendered excess or obsolete, SEASON will provide Customer with notification of the potential cost of such excess or obsolete material and/or inventory and make reasonable efforts for up to two (2) weeks, to mitigate that cost. After such two (2) week period, SEASON shall be entitled to deliver all remaining excess or obsolete material and/or inventory to the Customer and invoice for the full costs thereof, along with the costs of any and all other materials for which SEASON remains liable, as well as reasonable handling and mitigation charges. Such invoice shall be paid by Customer, without setoff or deduction, within seven (7) days from the date of the invoice.
7. Warranty. SEASON warrants that the Product(s) will be free from defects in workmanship for a period of one (1) year unless otherwise specified in SEASON’s quotation and commencing from date of delivery, provided that the Customer notifies SEASON in writing within thirty (30) days after discovery of the defect and requests a RMA and returns the defective Product(s) to SEASON within ten (10) days of such issued RMA. All returned Product(s) shall include documentation describing the nature of the defect, how it was discovered and under what conditions it occurred. The Customer will ship the Product(s) to SEASON freight prepaid and SEASON will return the Product(s) freight prepaid. SEASON will, at SEASON’s option and expense, repair or replace the defective Product(s) or give the Customer a credit based on the price paid for the Product(s). Prototypes and pre-production/pilot products are provided on an “AS IS” basis without warranty of any kind. SEASON reserves the right to apply a No Defect Found (NDF) charge, including return freight charges, for Product returned and found to be in conformance with the specifications in place at time of original manufacture. This warranty will have no legal effect if the Product is misused, damaged, modified, placed in an unsuitable physical or operating environment, maintained improperly, or caused to fail by a product or service not provided by SEASON, or if the Product has been subjected to any repair not authorized in writing by SEASON. This warranty does not include defects resulting from any Customer supplied design, specifications, documentation, test data, bills of materials, diagnostics, or any defects which are attributed to lack of design margin. The warranty also does not include any Product(s) on which SEASON has not performed the normal manufacturing/testing/inspection process, at the Customer’s direction. SEASON will have no liability for defects in Products where: (i) failure to identify or isolate such defects is attributable to Customer supplied or directed test hardware, software or procedures; (ii) such defects are attributable to any third-party supplied parts, components or materials (SEASON will however to the fullest extent possible pass through the benefit of any parts, components or materials warranties, if any, provided by such third-party suppliers to SEASON, to the Customer); or (iii) such defects result from third-party supplied designs or technology. THIS WARRANTY SETS OUT SEASON’S SOLE OBLIGATION AND LIABILITY, AND THE CUSTOMER’S EXCLUSIVE REMEDIES, FOR CLAIMS BASED ON DEFECTS IN OR FAILURE OF ANY PRODUCT OR SERVICE OR THE SUBJECT MATTER OF ANY SERVICE AND REPLACES ALL OTHER WARRANTIES, EXPRESS OR IMPLIED, INCLUDING BUT NOT LIMITED TO THE IMPLIED WARRANTIES OR CONDITIONS OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR NON-INFRINGEMENT OF THIRD-PARTY RIGHTS. IN NO EVENT SHALL SEASON’S LIABILITY FOR WARRANTY OR NON-WARRANTY CLAIMS EXCEED THE PURCHASE PRICE OF THE PRODUCTS FOR WHICH A CLAIM IS MADE. IN NO EVENT SHALL SEASON BE LIABLE TO CUSTOMER UNDER ANY THEORY OF LIABILITY FOR ANY INDIRECT, CONSEQUENTIAL, INCIDENTAL, PUNITIVE OR SPECIAL DAMAGES. REMEDIES SET FORTH HEREIN ARE EXCLUSIVE.
8. General. The Customer is responsible for obtaining any and all necessary licenses, consents, government documents and approvals prior to resale, import or any export of Product(s) under the laws and regulations of any relevant jurisdiction. SEASON reserves the right to unilaterally set credit limits from time to time for Customer in its sole discretion. In the event that Customer’s financial liability exceeds the amount of this credit limit, SEASON will give Customer notice of its default of this condition and, if not remedied within seven (7) days, SEASON has the right to take appropriate action to reduce its financial obligations. Any rights or obligations under these Terms of Manufacture, which by their nature continue after termination of these Terms of Manufacture, will remain in effect until they are completed. The laws of Hong Kong govern these Terms of Manufacture and all transactions hereunder and without regard to principles of conflicts of law. The parties submit to the non-exclusive jurisdiction of the courts of Hong Kong. The parties hereto expressly waive any right they may have to a jury trial and agree that any proceedings under these Terms of Manufacture shall be tried by a judge without a jury.