MACHINING

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KP PRECISION

Terms & Conditions

All purchase orders issued by KP Precision Machining or any employee thereof (hereinafter referred to as "buyer") shall be subject to the following terms and conditions in their entirety.

A. TERMS OF CONTRACT: No terms and conditions other than the terms and conditions set forth in this Order, including any terms and conditions in any document attached to or incorporated by reference, shall be binding upon Buyer unless accepted by it in writing signed by the Buyer's Purchasing Agent or General Manager. Notwithstanding any other provision of this Order, Buyer reserves expressly the right to revoke this Order at any time prior to receipt of notice of acceptance by Seller. Acceptance is limited to the terms stated herein. All terms and conditions contained in any prior proposal or acknowledgment of this Order that are different from or in addition to the terms and conditions of this Order are hereby rejected and shall not be binding on Buyer, whether or not they would materially alter this Order, and Buyer hereby objects thereto. Seller will be deemed to have assented to all terms and conditions contained herein if any part of the goods and/or service covered by this Order is shipped or an invoice is presented in connection with the said goods and/or services.

B. SPECIFICATIONS: All specifications, drawings and data submitted to Seller by Buyer in connection with this agreement are hereby incorporated herein and made a part hereof.

C. CONFIDENTIALITY: Each party acknowledges that its respective performance of its obligations hereunder may require that it have access to confidential business and proprietary information of the other. Each party agrees on behalf of itself and its officers, directors, employees and agents to use its/their best efforts to prevent either duplication or disclosure of data, plans, specifications, formulae, drawing or any other information whether business or technical, of a confidential nature, which has been furnished directly or indirectly, in writing or otherwise, to the other. "Confidential Information" shall include such information as would be apparent to a reasonable person, familiar with the disclosing party's business and the industry in which it operates, that such information is of a confidential or proprietary nature and that maintenance of its confidentiality would likely be of commercial value to the disclosing party. "Confidential Information" shall not include information that is in the public domain prior to its disclosure, becomes part of the public domain through no wrongful act of the receiving party, was in the lawful possession of the receiving party prior to its disclosure to the receiving party or was independently developed by the receiving party.

D. COMPLIANCE WITH LAWS: Seller shall comply with all applicable Federal, State and local laws, rules and regulations, including without limitation, any such laws, rules and regulations in any way pertaining to the manufacture, labeling, invoicing and sale of the goods covered by this Order, and Seller by accepting this Order, certifies that the goods were so manufactured. Seller further agrees to assume all responsibility for and save harmless Buyer, its employees and agents, from and against any liability or damages for violation thereof, or non-compliance therewith by Seller. Seller shall not discriminate against any employee or applicant for employment because of race, religion, color, sex, age or national origin.

E. STATE LAW: This Order shall be governed in all respects by the laws of the State of Florida and all actions commenced pursuant hereto shall be brought in a court of competent jurisdiction residing in Pinellas County, Florida.

F. DEFAULT: Neither Seller or Buyer shall be considered in default in the performance of its obligations herein to the extent that performance of such is delayed or prevented due to causes beyond the control of said party, including, but not limited to, acts of God, war, revolution, civil commotion, blockade or embargo, any law, order, regulation, ordinance, of any government, fires, floods, unavoidable casualties, strikes, labor disputes, and other causes beyond the reasonable control of either party. Notwithstanding the aforementioned, in the sole event that the Buyer incurs damages as a result of the Seller's delay in delivering goods subject to this Order, Seller shall be liable for such damages notwithstanding that such are due to causes beyond Seller's control or result without fault or negligence of Seller. Buyer may by written notice of default to Seller (a) terminate the whole or any part of this Order in any one of the following circumstances: (i) if Seller fails to perform within the time specified herein or any extension thereof; or (ii) if Seller fails to perform any of the other provisions of this Order, or so fails to make progress as to endanger performance of this Order in accordance with its terms; or (iii) if the Seller shall become insolvent or make a general assignment for the benefit of creditors or if a petition under any bankruptcy act or similar statute is filed by or against the Seller, and in any of these circumstances does not cure such failure within a period of ten (10) days or such longer period as Buyer may authorize in writing; and (b) upon such termination Buyer may procure, upon such terms as it shall deem appropriate, supplies or services similar to those so terminated, in which case Seller shall continue performance of this Order to the extent not terminated and shall be liable to Buyer for any excess costs for such similar supplies or services. As an alternate remedy, and in lieu of termination for default, Buyer, at its sole discretion, may elect (a) to extend the delivery schedule and/or (b) to waive other deficiencies in Seller's performance, in which case an equitable reduction in the Order price shall be granted. Buyer shall have the right at any time to require assurance from Seller. In the event Seller for any reason anticipates difficulty in complying with the required delivery date or performance schedule, or in meeting any of the other requirements of this Order, Seller shall promptly notify Buyer in writing. If Seller does not comply with Buyer's delivery schedule or performance schedule, Buyer may require delivery by fastest means and charges resulting from the premium transportation must be fully prepaid and absorbed by the Seller. The rights and remedies of the Buyer provided in this clause shall not be exclusive and are in addition to any other rights and remedies provided by law or under this Order.

G. FAIR LABOR STANDARDS ACT: In accepting this Order, Seller represents and warrants that the goods and/or services to be furnished hereunder were or will be produced in compliance with the requirements of the Fair Labor Standards Act of 1938, as amended, the Orders and regulations issued pursuant thereto. Unless otherwise agreed in writing, Seller shall insert a certificate indicating such compliance on all invoices submitted in connection with this Order.

H. TRANSPORTATION: Unless otherwise stipulated on the face of this Order or as modified by routing letter from Buyer's Purchasing Agent, goods covered by this Order shall be shipped "FOB destination". Risk of loss and title to said goods to pass to Buyer only upon delivery to Buyer's specified end destination. Delivery in advance of the specified Buyer's shipping date, however, will not cause passage of title, transfer of risk of loss and/or establish FOB point. Transportation charges on goods delivered FOB destination must be prepaid. No charges for unauthorized transportation will be allowed. Any unauthorized shipment that will result in excess transportation charges must be fully prepaid by the Seller. Buyer will offset unauthorized transportation charges not prepaid.

I. REJECTIONS: If any of the goods and/or services furnished hereunder are found at any time to be defective in material or workmanship or otherwise not in conformity with the requirements of this Order, Buyer, in addition to any other rights which it may have under all applicable warranties or otherwise, may at its option correct or have corrected the nonconformity at Seller's expense, or reject and return such goods and/or discontinue such services at Seller's expense. Such goods and/or services shall not be replaced or continued without written authorization from Buyer. Buyer may accept, without prejudice, a portion of any shipment, and, at its option, have Seller repair or replace any non-conforming portion of the shipment, at Seller's expense. The Seller, at its expense and at its risk, shall remove items rejected promptly. Final acceptance shall not be conclusive with respect to latent defects, fraud or such gross mistakes as amount to fraud or with respect to the Buyer's rights under the "Warranty" clause.

J. SET-OFF: Buyer shall be entitled at all times to set-off any amount owing at any time from Seller to Buyer or any of its affiliates against any amount payable at any time by Buyer in connection with this Order.

K. TERMS: The Order price shall not be increased nor the terms hereof changed without the Buyer's written consent. The Seller warrants that the prices of the items covered by this Order are not in excess of the Seller's lowest lawful prices in effect on the date of this Order for comparable quantities of similar items. If Seller offers cash discounts for early payment, the period of time agreed upon as constituting "early payment" shall begin with the later of the invoice date or receipt of merchandise. All shipments received or invoices dated after the twenty-fifth (25th) will be considered first of the following month dating. "Net invoices" will be paid on the last day of the following month. Unless freight or other charges are itemized, the discount will be taken on the full amount of the invoice.

L. PAYMENT: Upon submission of proper invoices, Buyer shall pay the Order price set forth herein for material and supplies delivered and accepted or services rendered and accepted; however, payment may be withheld or portions thereof deducted or set-offs made against Seller if Seller is not performing work in accordance with the provisions of this Order. There will be no minimum charges honored unless specifically agreed to prior to shipment. Shipments consigned directly to Buyer's customers that are shipped after the twentieth (20th) shall be considered as invoiced the following month. 

a). Unless otherwise agreed upon by the parties and stated on either quote or invoice, terms of payment for shipments are net cash within 30 days from the date of invoice.
 
b). Interest at the rate of 10% per month will be charged on delinquent accounts and a handling fee on bank refused payments will be $100.
 
c). A service charge will be imposed on overdue amounts, Buyer agrees to pay Seller’s costs of collection of overdue invoices, including, but not limited to attorneys' fees and additional charges in relation to the recovery of unpaid debt.
 
d). If Seller directs Buyer to remit payment to bank or other depository, Buyer agrees that such payment shall not necessarily constitute payment in full or a final settlement of Buyer’s account notwithstanding any language to the contrary on Buyer’s check, draft, or other order.

 M. HAZARDOUS MATERIALS REPORTING: If any of the items ordered herein constitute or contain "hazardous or toxic chemicals" as defined by any applicable Federal, State or local law, rule or regulation, Seller shall provide at the time of delivery all required notices and information, including without limitation all Material Safety Data Sheets ("MSDS") in approved form. Seller agrees to maintain such information current and shall provide Buyer with any amended, altered or revised information on a timely basis. When this Order or the specifications referred to herein, requires documentation or certification, this requirement is a material requirement of this Order; Seller's failure to provide such information prior to or at the time of delivery may result in withholding of payment until such is provided.

N. the use of statistical techniques for product acceptance and related instructions for acceptance by the organization;

O. DELIVERY SCHEDULE: Time is of the essence in the fulfillment of this Order. This Order is subject to cancellation if not shipped at the specified time. The Buyer reserves the right to refuse deliveries made in advance of the delivery schedule. Merchandise shipped after the time specified may be returned at the Seller's expense for full credit. Retention of all or any part of such merchandise shall not be considered acceptance of it. Acceptance of such merchandise shall not be deemed a waiver of the Buyer's right to hold the Seller liable for any loss or damage resulting there from, nor shall it act as a modification of the Seller's obligation to make future deliveries in accordance with the delivery schedule. Buyer shall be reimbursed in full for all merchandise returned. In addition thereto, Buyer shall have the privilege, if shipment is not made on time, to purchase similar merchandise in the open market in such quantities as they may find necessary not exceeding the amount called for in this Order and hold Seller responsible for the difference, if any, between the price so paid and the Order price.

P. SHIPMENT: All material shall be properly packed for shipment. The Seller shall comply with the Buyer's standard routing and shipping instructions issued by the Buyer. If such instructions are not attached hereto or have not been previously received, instructions must be requested from the Buyer immediately. No additional charge will be allowed for packing, crating, freight, express or cartage unless specified on the face of the Order. Any loss or damage, whenever occurring, which results from Seller's improper packaging or crating shall be borne by Seller. All items shall be properly identified with Buyer's Order number releasing shipments against this Order and the Order item number or other identification number shown.

Q. PATENT AND COPYRIGHT INDEMNITY: Seller represents and warrants that neither the merchandise nor the sale thereof covered by this Order will infringe upon or violate any trademarks, patents, copyright or other legal rights of third parties. Seller agrees to indemnify and save Buyer harmless from and against any and all claims, liability, loss, costs, attorneys' fees, expenses and damages due to or arising from any such alleged infringement or violation.

R. INDEMNIFICATION: To the fullest extent permitted by law, Seller agrees to indemnify, save harmless, and defend Buyer and its affiliated companies, their customers, directors, officers, employees and agents, from and against any loss, liability, cost, expenses, suits, actions, claims and all other obligations and proceedings whatsoever, including without limitation, all judgments rendered against, and all fines and penalties imposed upon Buyer and any reasonable attorney's fees and any other cost of litigation (hereinafter collectively referred to as "liabilities") arising out of injuries to persons, including death, or damage to property, caused by Seller, its employees, agents, subcontractors, or in any way attributable to the performance and prosecution of the work herein contracted for, including without limitation breach of warranty or product liability except that Seller's obligation herein to indemnify Buyer shall not apply to any liabilities arising from Buyer's sole negligence. Seller agrees to expressly waive its immunity, if any, under the applicable workers' compensation law if such immunity may affect this indemnification obligation.

S. WAIVER: The Buyer's failure to insist upon strict compliance shall not be deemed to be a waiver of any right granted Buyer herein. Buyer shall not be deemed to waive any such right unless such waiver is in writing signed by the Buyer's General Manager; such waiver shall not constitute a waiver of any other default under this Order.

T. TAXES: Unless prohibited by law, the Seller shall pay all federal, state or local tax, transportation tax, or other tax which is required to be imposed upon the items ordered hereunder, or by reason of their sale or delivery; the Order price shall be deemed to include such taxes. 

U. WARRANTY: Seller warrants that it has clear title to all items furnished subject hereto and that they are being delivered free and clear of any encumbrances. The Seller further warrants that all such items shall conform to the Seller's specifications, the requirements of this Order and approved sample or samples, if any, and further, that such shall be merchantable and fit for the Buyer's or its customer's intended use and that such items shall be free from defects in design, material and workmanship (collectively, the "Seller's Warranty"). Seller's Warranty shall remain in effect for a one (1) year period after acceptance of the items by the Buyer's customers, or for such longer period of time as the item is normally warranted. Neither approval by the Buyer of the Seller's design nor acceptance of the goods shall release or discharge Seller from liability for damages resulting from a breach of Seller's Warranty. If any defect, failure or other non-conformity appears, Buyer shall have the right to take the following actions: (1) retain such defective items and an equitable adjustment will be made in the Order price for such defective items; (2) require Seller to repair or replace such defective items, at the Seller's sole expense, including all shipping, transportation, and installation costs; or (3) correct or replace such defective items with similar items and recover the total cost thereof from the Seller. The aforesaid warranties shall survive acceptance and payment and shall run to Buyer, its customers and their successors in title and shall not be deemed to be exclusive, but shall be in addition to Buyer's other rights under the terms of this Order or at law or equity.

V. TERMINATION BY BUYER: Buyer shall have the right for and at its convenience to terminate this Order in whole or in part at any time, and from time to time, by written or telegraphic notice effective upon receipt by Seller, even though Seller is not in breach of any obligation hereunder. Upon receipt of notice of termination, Seller shall immediately discontinue performance and shall comply with Buyer's instructions concerning disposition of completed and partially completed items, work in progress and materials acquired pursuant to this Order. In the event of such termination, Seller shall be paid an amount in settlement to be mutually agreed upon by the parties which shall cover Seller's reasonable costs of performance incurred prior to termination in connection with the items for which this Order is terminated plus a reasonable profit based upon such costs. However, said payment shall not exceed the price specified herein for such items. In no event shall the Seller be entitled to recover incidental or consequential damages. Seller shall advise the Buyer, in writing, of Seller's claim, if any, for termination costs within ten (10) days after receipt of the notice of termination.

W. ENTIRE AGREEMENT: This Order constitutes the entire agreement between the parties and contains all the agreements and conditions of sale; no course of dealing or usage of the trade shall be applicable unless expressly incorporated in this Order. The terms and conditions contained in the Order may not be added to, modified, superseded or otherwise altered except by a written modification signed by the Buyer's Purchasing Agent or General Manager. Each delivery shall be deemed to be only upon the terms and conditions contained in this Order, which shall supersede all inconsistent provisions included in Seller's proposal and in any subsequent acknowledgment by Seller, notwithstanding the Buyer's act of accepting or paying for any delivery or similar act of the Buyer.

X. FLOW DOWN OF CUSTOMER REQUIREMENTS TO SUPPLIERS:
NOTES: Clauses 1 to 15 apply to all Purchase Orders.
Clauses 16, 17 apply to all Purchase Orders for calibrated equipment or calibration services
Clauses 18 and 19 apply to all Purchase Orders for raw material.
Clause 20 applies to all weld rod Purchase Orders.
Clause 21 applies to all CARC paint Purchase Orders.

1 QUALITY/INSPECTION SYSTEM. The supplier shall maintain a quality/ inspection system which is in conformance with the requirements of AS9100 and/or ISO9001 to include: Receiving, First Article, In-Process and Final inspection including Inspection and Test Records supplied to KP Precision at the point of First Article Inspection (if requested via Buyer’s Purchase Order) and upon completion and shipment of said order.

2 CERTIFICATION OF CONFORMANCE. (C of C) attesting to the conformance of material, (which shall include chemical and/or physical reports with "actual" or "typical" as contractually required results of tests conducted on all materials shipped, verifying conformance to any specifications referenced on drawings and/or purchase orders) outside services performed, hardware, machining/manufacturing, etc. The C of C shall include at a minimum date, purchase order number, suppliers name, part number, drawing number and/or representative, lot, batch, serial number or other identification be signed by an authorized representative of the Supplier and shall accompany an order upon receipt of said items to Buyer.

3 CONTROL OF SPECIAL PROCESSES. In addition to the requirements of clause 3, both the vendor (supplier) and any subcontractor(s) used shall be a Buyer and/or Customer approved source for said Processes. These include operations subject to process controls such as: coating, joining, heat treating, cleaning, nondestructive test, etc. The vendor (seller) shall be approved as per above to perform specific required Special Processes, or use Special Process vendors acceptable to Buyer and Buyer's customer.

4 RIGHT TO VERIFY. Buyer's customer shall be afforded the right to verify at the vendors (sellers) premises that the subcontracted product conforms to specified requirements.

5 RIGHT OF ENTRY. The Supplier shall include provisions in the subcontracts to allow the Supplier, Customer, and Regulatory agencies Right of Entry to any place necessary to determine and verify the quality of contracted work, records and material. Note: Delegation of supplier verification to subcontractor is not practiced.

6 RECORD RETENTION AND CERTIFICATIONS. Unless otherwise specified, records must be maintained for a period of 7 years and must be retrievable within 48 hours of a request by Buyer. Certification test data shall be traceable to the organization performing the testing, special processing and/or inspection(s) requested via Buyer's Purchase Order. All factual information shall be included to demonstrate conformance of specification and/or Purchase Order requirements.

7 REPORT OF NON-CONFORMITIES OR INCONSISTENCIES WITH PRODUCT AND/OR PURCHASE ORDERS. The supplier shall review the Purchase Order and product manufacturing, processing, and/or testing requirements prior to its initiation. If errors or inconsistencies are noted with the P.O., Part and or other document referenced by the Purchase Order the supplier must immediately notify Buyer or its acting delegation. Supplier proceeding with work without written concurrence does so at his own risk. Product will not be accepted by Buyer’s Quality Assurance Department until the Purchase Order and all documentation referenced there on properly describe the comply with product delivered.

8 CORRECTIVE ACTION REQUEST. Acceptance of this purchase order obligates the seller to perform, upon request, a corrective action investigation when discrepant material is received by the buyer. A written report shall be furnished, within a period of five business days which is specific and conclusive to prevent a reoccurrence of the discrepancy.

9 PROHIBITED PRACTICES. The supplier does not have material review authority and shall not make any unauthorized repairs by any means without Buyer or Buyer’s customer’ approval.

10 PROHIBITED MATERIAL USES. Parts supplied on this Purchase Order shall not, and indicate, “have not been exposed to functional mercury or mercury compounds".

11 EMPLOYMENT. All suppliers are required to comply with the Equal Employment Opportunity requirements of FAR 52.222-22.

12 FOREIGN OBJECT DEBRIS / DAMAGE (FOD). The supplier shall employ appropriate housekeeping practices to assure timely detection and removal of residue/debris generated, if any, during operations and/or normal daily tasks and shall ensure FOD requirements are flowed down to sub-contractors and suppliers at every tier.

13. PACKAGING. As a minimum, the supplier shall package all material in a manner that will ensure protection against corrosion, oxidation, deterioration and physical damage during shipment. Due to inadequate packaging will be rejected and returned to the supplier. In addition, when materials delivered are lot-controlled and multiple material lots are shipped, each lot shall be separately packaged and identified.

14 FLOW-DOWN. The supplier shall flow-down all applicable requirements to subcontractors and suppliers at every tier.

15 CALIBRATION SYSTEM. Seller’s (herein referred to as supplier) calibration system shall meet the requirements of: ISO 17025, ISO 10012-1, AS9100, ANSI-Z540-1 or MIL-STD-45662.

16 CERTIFICATION OF CALIBRATION. The calibration service shall provide a certificate attesting to the accuracy of the items procured and be supplied with each shipment. This certification must contain all the test parameters necessary to demonstrate conformance to the manufactures specifications and shall be traceable to National Institute of Standards and Technology (NIST).

17 PREFERENCE FOR DOMESTIC SPECIALTY METALS AND RESTRICTIONS ON ARMOR PLATE. Material shall be of domestic origin or from one of the qualifying countries in accordance with DFAR 252.225-1017. Armor material shall be melted and rolled in the United States or Canada as prescribed in DFAR 252.225-7030-3 when subject to the restrictions detailed in the clause. Suppliers shall provide evidence of compliance, including flow down to all sub-tier suppliers, with all shipments.

18 MATERIAL TEST REPORTS. The supplier shall provide chemical and physical analysis of raw material demonstrating compliance to the applicable material specification.

19 WELD ROD REQUIREMENTS. When requested, weld rod certifications shall include actual values which tie to the heat lot delivered. Weld rod may be identified either by stamping or flagging the end with the material type.

20 CARC PAINTING. CARC painting shall be performed according to CARC Standard PO Requirements.

21 CONFLICT MINERALS. Any PO calling for the purchase of Tantalum, Tin, Tungsten or Gold components are to be sourced to the best of the supplier's ability from areas that are in compliance with the Dodd-Frank Wall Street Reform Act of 2010. Buyer reserves the right to ask for an official statement on the supplier's Conflict Minerals policy at any time.