PURCHASE ORDER TERMS AND CONDITIONS

1 DEFINITIONS. As used in this Purchase Order, the following capitalized terms shall have the following meanings:

1.1 “Change Order” shall have that meaning assigned in Section 9 below.
1.2 "Company" shall mean the entity referred to as Company on the face of this Purchase Order, and its duly authorized representative.
1.3 "Purchase Order" shall mean: (a) the preceding page(s) accompanying these terms and conditions; (b) all specifications included in any applicable blueprints or other documents attached hereto, provided herewith or incorporated herein by reference; and (c) the terms and conditions stated herein.
1.4 "Supplies" shall mean all designated parts, raw materials, components, intermediate assemblies, equipment, and other supplies including indirect materials, technical data, drawings, or services to be furnished by Vendor to the Company (including without limitation any repaired or replacement parts, materials, components, intermediate assemblies, equipment, supplies and services) pursuant to the terms of this Purchase Order.
1.5 "Vendor" shall mean the entity referred to as Vendor on the face of this Purchase Order and its authorized agents and representatives.

2 CONTROLLING TERMS.

2.1 Acceptance of this Purchase Order is expressly limited to all specifications, terms, conditions, and provisions stated in this Purchase Order. No purported revisions, additions, or deletions to the Purchase Order shall be effective, whether in Vendor's response, invoice, acknowledgment or otherwise, and no local, general or trade custom or usage, shall be deemed to affect any modification or variation of the Purchase Order, except as may be provided in a Change Order issued by the Company through its authorized representative.
2.2 Vendor’s acknowledgment and confirmation of this Purchase Order or the delivery of any Supplies pursuant to this Purchase Order shall constitute Vendor’s acceptance of this Purchase Order and Vendor’s express assent to this Purchase Order, in strict accordance with all specifications, terms, conditions and provisions stated in this Purchase Order.
2.3 Any Purchase Order submitted in response or with reference made to Vendor's prior proposal shall be exclusive of any terms and conditions attached to or referred to in Vendor’s prior proposal.
2.4 If Vendor cannot satisfy this Purchase Order in any manner, the Vendor must, as soon as possible after receipt of the Purchase Order and prior to acceptance of the Purchase Order or commencing work on the Supplies, notify the Company in writing, or verbally and immediately thereafter confirmed in writing, of Vendor’s inability to deliver the Supplies in accordance with this Purchase Order.

3 PRICES, INVOICING, PAYMENT, INDEMNIFICATION AND WAIVER OF LIENS.

3.1 Prices shown on the face of this Purchase Order (“Price”) may not be increased for any reason, including but not limited to increased material, labor, or transportation costs or otherwise, without written authorization by the Company.
3.2 Unless otherwise specified in this Purchase Order, the Price includes all packaging, transportation costs, insurance, customs duties and fees, and applicable taxes, including but not limited to, all sales, use or excise taxes.
3.3 Unless authorized by the Company, Vendor agrees to issue one invoice per shipment, with only items on the approved Purchase Order consistent with accurate pricing, quality, quantity, and timing. If invoices are not consistent with pricing and/or quantities as requested or the Purchase Order, then Vendor agrees to submit corrected invoice(s). Corrected invoices will be paid within terms calculated from the date such invoice(s) are received.
3.4 Payment terms are noted on the face of the Company’s Purchase Order, otherwise payment terms are Net 60 following the Company’s receipt and acceptance of conforming Supplies and receipt, in proper form and substance, of all documentation required by the applicable Purchase Order, except for any amounts disputed by the Company in good faith. Vendor and the Company shall seek to resolve all such disputes expeditiously and in good faith. Vendor shall continue to perform its obligations under this Purchase Order notwithstanding any such dispute.
3.5 Vendor agrees to indemnify, defend, and hold the Company harmless from and against any and all liens and encumbrances on the Supplies and for all Losses (as defined in Section 13.1 below) rising out of any claim for payment by any laborer, subcontractor, or sub-Vendor of Vendor or otherwise as a result of Vendor's performance of the Purchase Order. Upon request by the Company, Vendor shall furnish the Company an executed waiver of liens and claims in form reasonably satisfactory to the Company.

4 DELIVERY.

4.1 All Supplies shall be delivered to the Company’s address listed on the face of this Purchase Order during the Company’s normal business hours or as otherwise instructed by the Company.
4.2 Deliveries will be made in quantities and at the times specified on the Purchase Order. Time and quantity of delivery are of the essence. Vendor will adhere to shipping directions specified on the Purchase Order. Premium shipping expenses and/or other related expenses necessary to satisfy the Company’s delivery schedules will be at Vendor’s sole cost and responsibility.
4.3 If Vendor fails to deliver the Supplies in full at the time and place specified, the Company may reject the Supplies and immediately cancel the Purchase Order or any portion thereof by providing written notice to Vendor. If Vendor delivers more or less than the quantity of the Supplies ordered, the Company may reject all or any excess Supplies. Any such rejected Supplies shall be returned to Vendor at Vendor’s risk and expense. If the Company does not reject the Supplies and instead accepts the delivery of the Supplies at the increased or reduced quantity, the Price for the Supplies shall be adjusted on a pro-rata basis. The Company's acceptance of a shipment of less than all Supplies specified herein shall not obligate the Company to accept the remainder of a shipment of Supplies or any future shipments.
4.4 If Vendor is required to provide Safety Data Sheets, as defined in 29 CFR 1910.1200(g) (“SDS”), the SDS will be delivered to the Company prior to delivery of any Supplies under a Purchase Order.
4.5 Vendor shall, upon the request of the Company, suspend shipment and deliveries of supplies and all work and operations to be furnished under any Purchase Order for such reasonable period or periods as the Company may require in a Change Order.
4.6 Vendor shall indemnify the Company for and against any claims, damages, cost, expenses, or Losses incurred by the Company including without limitation, lost production time, product rework costs, scrap material costs, inspection costs, and transportation costs resulting from the Vendor’s failure to deliver the Supplies on the delivery date specified on the Purchase Order.
4.7 Title and risk of loss of any Supplies provided by Vendor pursuant to this Purchase Order shall only transfer to the Company at the time the Supplies are delivered and accepted into the Company’s assembly facility.

5 WARRANTIES.

5.1 Vendor expressly warrants that all Supplies delivered by Vendor pursuant to the Purchase Order: (a) strictly conform to all specifications, terms, conditions and provisions stated in this Purchase Order; (b) are free from defects in design, material and workmanship; (c) are of merchantable quality and fit for their intended purpose and operate as intended, whether express or reasonably implied; (d) are free and clear of all liens, security interests or other encumbrances; (e) bear all warnings, labels, and markings required by applicable laws and regulations; (f) to the extent they are subject to laws prohibiting adulteration or misbranding, are not adulterated or misbranded within the meaning of such laws as of the date of delivery to the Company; and (g) may be introduced into interstate commerce without violation of applicable laws and regulations.
5.2 The warranties in this Section 5, together with all other warranties included in this Purchase Order (collectively “Warranties”) survive any delivery, inspection, acceptance, or payment for the Supplies by the Company.
5.3 The Warranties are cumulative and in addition to any other warranty provided by law or equity. Any applicable statute of limitations runs from the date of Vendor’s discovery of the noncompliance of the Supplies with the Warranties.

6 DISPOSITION OF REJECTED MATERIAL (NON-CONFORMNING MATERIAL).

6.1 The Company shall have the right, but not the obligation, to inspect and test all or a sample of the Supplies at any time, including without limitation during manufacture by Vendor and any time prior to or upon delivery to the Company. Supplies accepted by the Company shall remain subject to inspection and testing by the Company after physical receipt, installation, or assembly of the goods. In addition to all other rights hereunder or otherwise, the Company may, in its sole discretion, reject and return all or any portion of the Supplies that fail to strictly conform to this Purchase Order or that are otherwise found to be defective, before or after acceptance.
6.2 If the Company rejects any portion of the Supplies, the Company has the right, effective upon written notice to Vendor to: (a) rescind the Purchase Order in its entirety; (b) accept the Supplies at a reasonably reduced price; or (c) reject the Supplies, return the Supplies and/or require replacement of the rejected Supplies. In any such event, the Vendor shall reimburse the Company for its reasonable costs associated with the evaluation of the nonconforming Supplies including but not limited to, labor and equipment costs incurred in the evaluation. Any rejected Supplies returned to Vendor shall be returned at Vendor’s sole risk and expense. If the Company requires replacement of the Supplies, Vendor shall, at its expense, replace the nonconforming Supplies and pay for all related expense, including but not limited to, transportation charges for the return of the defective goods and the delivery of the replacement Supplies. If Vendor fails to timely deliver replacement Supplies, the Company may replace them with Supplies from a third party and charge Vendor the cost thereof and terminate this Purchase Order.
6.3 Any inspection or other action by the Company under this Section shall not reduce or otherwise affect Vendor’s obligations under this Purchase Order and the Company shall have the right to conduct further inspections after Vendor has carried out its remedial actions.

7 PACKING, SHIPPING, AND STORAGE.

7.1 Supplies must be shipped by the carrier designated on the Purchase Order or the carrier agreed to by written agreement between Vendor and Company.

7.2 Vendor shall, at its expense, package and preserve the supplies in such a manner that they will arrive at the designated delivery point free from damage and in such a condition as to permit reasonable handling and six months' storage under normal environmental conditions without detrimental effects on the supplies. A packing list shall be included with each shipment.

7.3 Vendor shall give written notice of shipment to the Company when the Supplies are delivered to the carrier for transportation.

7.4 Vendor shall provide the Company with: (a) two copies of Vendor's invoice; (b) a packing list; and (c) original bills of lading and any other documents necessary to release the Supplies to the Company, not later than the day after the shipment of Supplies are delivered to the carrier. Individual invoices shall be issued for each separate shipment.

7.5 All invoices, packing lists and bills of lading shall clearly reference piece number, the Company's Purchase Order number and Vendor's packing slip number.

7.6 Partial shipments must be identified as such on the shipping memoranda and invoices.

7.7 No over-shipment of quantities nor pre-shipment against specified delivery dates as specified on the Purchase Order may be made without the prior written approval of the Company. Any such over-shipment or pre-shipment made without the Company’s written consent may, at the option of the Company, be returned at Vendor’s risk and expense.

7.8 All of Company’s expenses associated with shipping, storage, packaging, and Company’s handling related to the rejection, return repair or replacement of supplies pursuant to Section 6. above shall be at Vendor’s sole cost and expense.

7.9 Vendor must provide the Company prior written notice if it requires the Company to return any packaging materials. Any return of such packaging material shall be made at Vendor’s risk and expense.

8 CANCELLATION.

8.1 The Company may cancel this Purchase Order, in whole or in part, at any time with or without cause immediately upon written notice to Vendor. If the Company cancels the Purchase Order for any reason, Vendor’s sole and exclusive remedy shall be the payment for Supplies shipped by Vendor prior to the written notice of cancellation and thereafter delivered to and accepted by the Company.
8.2 Notwithstanding the foregoing, the Company may cancel this Purchase Order at any time without liability to Vendor or cancellation charges in the event the Purchase Order is cancelled as a result of force majeure, including without limitation, wars, riot, crimes, fires, strikes, disease, government declared health emergencies or quarantine, acts or demands of any government authority or any flood, earthquake, hurricane, tornado, volcanic eruption or other acts of God.

9 CHANGES TO PURCHASE ORDER.

9.1 The Company reserves the right, at any time prior to delivery of the Supplies, to make changes to this Purchase Order, including without limitation: (a) drawings, designs or specifications: (b) method of shipment or packing: (c) time and/or place of delivery; and (d) the quantity of items ordered, by written instructions or verbal instructions confirmed in writing to Vendor (“Change Order”).

10 INTELLECTUAL PROPERTY.

10.1 Vendor warrants that the supplies specified herein, and their sale or use, alone or as a significant element of a combination, do not and will not, infringe or misappropriate any United States or foreign patents, copyrights, trademarks, trade secrets or other proprietary rights of any third party.
10.2 In the event that the Supplies or the Company’s use is held in any claim, suit or proceeding to constitute an infringement of the rights of a third party, or if the Company determines that there is a substantial risk of a finding of such infringement, Vendor agrees, in addition to the indemnification provisions of Section 13.2 or otherwise herein, and at its sole cost and expense to: (a) procure for the Company, at no expense to the Company, the right to continue using the Supplies, (b) replace the Supplies with equivalent goods that meet the requirements of the applicable Purchase Order and that do not infringe any such rights, and/or (c) modify the Supplies so that they become non-infringing.
10.3 Any inventions, discoveries, patents, copyrights, trade names, trade secrets, mask works or other intellectual property created in performance of this Purchase Order shall be the sole property of the Company and Vendor, at Vendor’s sole cost and expense, shall do all things necessary to transfer the ownership thereof and to perfect the same in the name of the Company or its designee.

11 CONFIDENTIALITY AND DESIGN INFORMATION.

11.1 Vendor acknowledges that Vendor will have access to certain confidential information of the Company and therefore, Vendor agrees that, all non-public, confidential or proprietary information of the Company, including but not limited to, specification, samples, patterns, designs, plans, drawings, documents, data, business operation, customer lists, pricing, discounts or rebated, disclosed by the Company to Vendor, whether disclosed orally or disclosed or access in written, electronic or other form or media, and whether or not marked, designated or otherwise identified as “confidential,” in connection with this Purchase Order (collectively “Confidential Information”) is confidential, and is provided solely for Vendor’s use in providing the Supplies and may not be disclosed or copies unless authorized by the Company in writing. Upon the Company’s request, Vendor shall promptly return all documents and other materials received from the Company, The Company shall be entitle to injunctive relief for any violation of this Section. This Section shall not apply to information that is: (a) in the public domain; (b) known to the Vendor at the time of disclosure; or (c) rightfully obtained by Vendor on a nonconfidential basis from a third party.
11.2 Vendor shall not use for its own benefit or for the benefit of others, any Confidential Information.
11.3 Vendor agrees that any Supplies made according to a design specified by the Company (not previously a standard commercial design of Vendor) will not be furnished or disclosed, in whole or in part, by Vendor to any person, firm, or corporation other than the Company.

12 REMEDIES.

12.1 The Company's acceptance of all or any part of the Supplies provided pursuant to this Purchase Order shall not be deemed a waiver of Vendor’s failure to comply with this Purchase Order. The Company retains the right to cancel any remaining portion of the Purchase Order, to reject any portion of the Supplies delivered, or to revoke acceptance as to any portion of the Supplies accepted, and return such Supplies to Vendor and to back charge or otherwise recover the purchase price, any excess costs of cover, damages, including manufacturing costs, costs of removal or recall, transportation and custodial expenses, injury to person or property incurred by the Company and any other Losses, all in addition to the Company’s other remedies under this Purchase Order, including without limitation Section 6 herein, or applicable law.
12.2 The Company shall have the right to cancel any outstanding Purchase Order immediately in the event Vendor becomes insolvent, makes an assignment for the benefit of creditors, or files or has filed against it any petition in bankruptcy.
12.3 The Company’s remedies provided throughout this Purchase Order shall be cumulative and in addition to any other or further remedies provided in law or equity.
12.4 No waiver by any party of any of the provisions of this Purchase Order shall be effective unless explicitly set forth in writing and signed by the party so waiving.
12.5 No failure to exercise, or delay in exercising, any rights, remedy, power, or privilege arising from this Purchase Order shall operate or be construed as a waiver thereof, nor shall any single or partial exercise of any right, remedy, power, or privilege hereunder preclude any other or further exercise thereof or the exercise of any other right, remedy, power, or privilege.
12.6 The Company shall be entitled at all times to set-off any amounts owed or owing by the Company to Vendor against any amounts that are owed or owing by Vendor to the Company.
12.7 In the event the Company files or pursues any suit or other proceeding to construe or enforce any provision of this Purchase Order, the Supplies or dispute otherwise related to or in connection with this Purchase Order or the Supplies, the Company shall be entitled to the payment of all its attorneys’ fees and associated costs incurred by the Company, in addition to all other amounts and relief to which the Company is entitled.

13 INDEMNITY: INSURANCE.

13.1 Vendor shall defend, indemnify and hold harmless the Company and the Company’s subsidiaries, affiliates, successors or assigns and its respective members, directors, officers, shareholders and employees and the Company’s customers (collectively, “Indemnitees”) against any and all loss, injury, death, damage, liability, claim, deficiency, action, judgment, interest, award, penalty, fine, cost or expense, including all attorneys’ fees and associated costs, and the cost of enforcing any right to indemnification hereunder and the cost of pursing any insurance providers (collectively “Losses”) arising out of or occurring in connection with the Supplies purchased from Vendor or Vendor’s negligence, willful misconduct or breach of this Purchase Order. Vendor shall not enter into any settlement without the Indemnitee’s prior written consent.
13.2 Vendor shall, at its expense, defend, indemnify, and hold harmless the Company and any other Indemnitee against any and all Losses arising out of or in connection with any claim that an Indemnitee’s use or possession of the Supplies infringes or misappropriates the patent, copyright, trade secrets or other intellectual property right of any third party. In no event shall Vendor enter into any settlement without the Indemnitee’s prior written consent.
13.3 Vendor further agrees that, from the time of its acceptance of this Purchase Order and for a period of one (1) year thereafter, Vendor shall, at its own expense, maintain and carry insurance in full force, including but not limited to, commercial general liability (including product liability) in a sum no less than $1,000,000 with financially sound and reputable insurers. Upon the Company’s request, Vendor shall provide the Company with a certificate of insurance from Vendor’s insurer evidencing the insurance coverage specified herein. The certificate of insurance shall name the Company as an additional insured. Vendor shall provide the Company with fourteen (14) days’ advance written notice in the event of a cancellation or material change in Vendor’s insurance policy. Expect where prohibited by law, Vendor shall require it insurer to waive all rights of subrogation against the Company’s insurers, the Company, and other Indemnities.

14 RELATIONSHIP OF PARTIES.

14.1 The relationship between the parties to this Purchase Order is that of independent contractors. Nothing contain in this Purchase Order shall be construed as creating any agency, partnership, joint venture or other form of joint enterprise, employment, or fiduciary relationship between the parties, and neither party shall have authority to contract for or bind the other party in any manner whatsoever. No relationship of exclusivity shall be construed from this Purchase Order.
14.2 Vendor warrants that it is and undertakes performance of this Purchase Order as an independent contractor, with sole responsibility for the payment of all wages, withholdings, workman’s compensation insurance and benefits for its employees and all federal and/or state income taxes, unemployment insurance, social security and/or other similar taxes incurred as a result of payments received for the Supplies.
14.3 Vendor shall not use or permit the use of the Company name or the name “THE PHOENIX GROUP” or any similar names, words, or trademarks of the Company in the description of or in the marketing of products produced by Vendor or in any manner advertise or publish the fact that Vendor has contracted to furnish supplies pursuant to this Purchase Order or any Purchase Order with the Company.

15 VENDOR'S INSOLVENCY.

15.1 If Vendor: (a) ceases to conduct operations in the normal course of business; (b) becomes unable to meet its obligations as they mature; (c) a receiver is appointed or applied for; (d) makes an assignment for the benefit of creditors; or (e) the Company reasonably believes Vendor may be unable to complete this Purchase Order; the Company may, at its option, terminate this Purchase Order, in whole or in part, without liability except for Supplies previously delivered to and accepted by the Company or, in the sole discretion of Company, in lieu thereof demand adequate written assurance of Vendor’s performance of this Purchase Order.
15.2 If a bankruptcy or insolvency proceeding is brought by or against Vendor, the Company may demand adequate assurance of Vendor’s performance of this Purchase Order and in the absence thereof, terminate or seek the termination of this Purchase Order in accordance with the United States Bankruptcy Code, as applicable.

16 NOTICE.

16.1 Any notice provided pursuant to this Purchase Order must be in writing and must be either personally delivered, mailed by certified mail (postage prepaid and return receipt requested) or sent by reputable overnight courier service (charges prepaid) to each party hereto at the addresses set forth on the face of this Purchase Order or such other address or to the attention of such other person as the recipient party shall have specified by prior written notice to the sending party. Any notice provided under this Purchase Order will be deemed to have been given when so personally delivered or, if sent by overnight courier, one (1) day after deposit with such courier, or if sent or, if mailed, three (3) days after deposit in the U.S. mail.

17 COMPLIANCE WITH LAWS.

17.1 Vendor represents and warrants that all Supplies provided under this Purchase Order have been produced and all services performed in compliance with applicable federal, state and local laws, ordinances, codes, rules, regulations or standards, including without limitation, the Fair Labor Standards Act, and all other state and federal statutes and regulations pertaining to the manufacture, labeling, invoicing and sale of such goods or services, environmental protection, immigration, employment and occupational safety and health.
17.2 If a Purchase Order is being placed for a government contract, Vendor also represents and warrants that they shall at all times comply with applicable provisions relating to government contractors and subcontractors, which provisions, and any contract clauses required thereunder, are incorporated into the applicable Purchase Order by reference as if set forth in full, including 41 CFR 60-1, et seq., with the reporting, record keeping and affirmative action program requirements set forth therein as required by 41 CFR 60-1.7; incorporation of the Equal Opportunity Clause of EO 11246 pursuant to 41 CFR 60-1.4; the maintenance of non-segregated facilities as required by 41 CFR 60-1.8; the provisions of 41 CFR 60-250.5 relating to disabled and Vietnam era veterans; the provisions of 41 CFR 60-300 relating to veterans; and the provisions of 41 CFR 60-741 relating to handicapped workers and the employee notice requirements set forth in 29 CFR Part 471, Appendix A to Subpart A, all of which are hereby incorporated by reference into this Purchase Offer. Where legally required, Vendor shall include these clauses in its purchase orders supporting the Company’s Purchase Order, and shall at the Company's request certify to all of the foregoing.

18 GOVERNING LAW AND VENUE.

18.1 The terms of this Purchase Order shall be governed by and construed exclusively by the internal laws of the State of Indiana without regard to its conflict of laws principles. The parties hereto: (a) irrevocably consent to the exclusive jurisdiction and venue of the courts of the State of Indiana, Johnson County, and the United States District Court for the Southern District of the State of Indiana; and (b) irrevocably waive any and all objections to such consents.

19 MISCELLANEOUS PROVISIONS.

19.1 Vendor shall not assign, transfer, delegate, or subcontract any of its rights or obligations under this Purchase Order without the prior written consent of the Company. Any purported assignment or delegation in violation of this Section shall be null and void. No assignment or delegation shall relieve the Vendor of any of its obligations hereunder. The Company may at any time assign, transfer, or subcontract any or all of its rights or obligation und this Purchase Order without Vendor’s prior written consent.
19.2 This Purchase Order shall inure to the benefit of and bind the Vendor and the Company and their respective successors and permitted assigns.
19.3 This Purchase Order is for the sole benefit of Vendor and the Company and their respective successors and permitted assigns. Nothing herein, express, or implied, is intended to or shall confer on any person other person or entity any legal or equitable right, benefit, or remedy of any nature whatsoever by reason of this Purchase Order.
19.4 The section headings herein are solely for the convenience of reference and shall not be given any effect in the construction or interpretation of this Purchase Order.
19.5 The Company shall not be liable to Vendor for any delay or failure in performing its obligation under this Purchase Order to the extent that such delay or failure is caused by an event or circumstances that are beyond the control of that party, without such party’s fault or negligence, and which by its nature could not have been foreseen by such party or, if it could have been foreseen, was unavoidable (“Force Majeure Event”).
19.6 This Purchase Order, together with Change Orders specific to this Purchase Order, if any, constitutes the sole and entire agreement between the Vendor and the Company with respect to this Purchase Order, and supersedes all prior or contemporaneous understandings, agreements, negotiations, representations and warranties and communications, both written and oral with respect to the Supplies and this Purchase Order. No other statements, agreements or promises, verbal, written or otherwise shall be used to modify or construe this Purchase Order.
19.7 If any provision of this Purchase Order is determined to be illegal or unenforceable in any jurisdiction, such illegal or unenforceable provision shall not invalidate or render unenforceable such provision in any other jurisdiction or affect any other enforceable provisions of this Purchase Order, which shall remain in full force and effect.

 

Falcon Diversified, Inc.
Falcon Manufacturing, LLC ∙ Phoenix Group, Inc. ∙ Phoenix Assembly, LLC ∙ Phoenix Resource Management, LLC
Phoenix Quality Management, LLC ∙ Phoenix Logistics, LLC ∙ Phoenix Technologies, LLC
www.falcon-manufacturing.com
164 South Park Blvd., Greenwood, IN. 46143 Office 317-884-3600 Fax 317-889-8515