Purchase Order Terms


Each purchase order (“Order") issued by Lumenera Corporation its subsidiaries or affiliates (“Buyer”) constitutes an offer to purchase, lease, or license Seller’s tangible or intangible goods and/or services (“Items”) in accordance with these Terms and Conditions (“Terms”) and the terms and Specifications contained or referenced in the order which, when accepted by Seller as provided herein, together comprise the entire agreement (“Contract”) between Seller and Buyer regarding the supply of such Items, superseding all prior communications and agreements. Seller agrees that its acceptance of each order and, if an order follows a previous quotation or offer from Seller, Buyer’s acceptance of such quotation or offer, will in each case be limited to and expressly conditioned upon Seller’s assent to the terms and conditions in the order and herein. Seller will be deemed to have accepted the order and these Terms and will be bound by the Contract upon delivery of its order acknowledgement, commencement of delivery or production of Items, or any other act constituting legal acceptance, even if such acceptance purports to state terms or conditions additional to or different from those herein, and neither the order nor Buyer’s acceptance of Items will constitute acceptance or confirmation of any different or additional terms or conditions (preprinted or otherwise) proposed by Seller in its acceptance or otherwise, all of which are hereby expressly rejected by Buyer and will not become part of the Contract (except as may be otherwise expressly specified in the order) and Buyer will have no obligation to separately object to such terms, Buyer’s offer and the Contract between the parties being expressly limited to the terms and Specifications as set out in the order and herein. Buyer may revoke its order at any time prior to acceptance.

PRICES: The Price for each Item will be the lowest of (i) the price stated in the order, (ii) the price last charged or quoted to Buyer, or (iii) the lowest price at which the Item or any substantially similar Item is offered by Seller in similar quantities and circumstances within 30 days before or after the term of the order. All prices are FCA to the specified delivery location (Incoterms 2010), freight and insurance prepaid. Unless otherwise required by law, prices include all applicable federal, provincial, state, and local taxes, it being agreed that, unless otherwise stated in the order, all Items are for remanufacture or resale and exempt from sales tax. Any taxes Seller is required by law to collect that are not covered by an applicable exemption will be separately stated or indicated as being included in the unit price on Seller’s invoice. No additional charges, including boxing, loading, handling, cartage, or other extras, will be allowed and no minimum purchase or minimum order quantities will apply unless specified in the order. If an order is not on a fixed price basis, Buyer may reject price increases by canceling all or part of the order at any time.

DELIVERY: Requested delivery dates will be stated in each order and when accepted by Seller are firm. All Items will be packaged, inspected, shipped, and/or provided in accordance with Buyer’s instructions and good industry practice, and Seller will be responsible for the Items and retain all risk of loss until Buyer’s receipt and acceptance thereof at the specified delivery location. Seller acknowledges that Buyer’s production, marketing, and delivery schedules (“Schedules”) are established in reliance upon the delivery dates specified in its orders; accordingly, time is of the essence, and Seller will ensure delivery at the times specified in each order unless Buyer is notified Promptly and agrees in writing to alternate dates. Any Items not timely delivered are non-conforming, and Seller will be responsible for any premium or expedited transportation costs required to meet the Schedules. If delivery is not timely made, Seller will be liable for any late delivery penalties specified in the order, and for any losses, costs, or damages resulting from such delay, including cover under the Uniform Commercial Code, unless due to unforeseeable causes beyond the control and without the fault or negligence of Seller. Delivery in installments other than as provided in the order must be approved by Buyer prior to shipment. Overshipments, including minimum requirements without advance agreement, or deliveries in advance of scheduled delivery dates are at Seller’s risk, and Buyer at its option may retain any or all such Items (with invoicing deferred until the scheduled delivery date) or reject and return them at Seller’s expense. Seller will not make commitments or produce Items in advance of the schedule required to meet Buyer’s orders.

ACCEPTANCE: Seller will accept ordered Items unless notice of rejection is given within a reasonable time which (unless otherwise agreed) will be ninety (90) days from receipt of delivery. Acceptance does not constitute a waiver of any of Seller’s warranties or Buyer’s rights.

INVOICING & PAYMENT: Following each delivery of Items hereunder Seller will deliver a complete and correct invoice, which will include Item numbers and be accompanied by a bill of lading or express receipt. Payment terms are net thirty (30) days from receipt of Seller’s proper invoice. Payment of any invoice will not constitute acceptance of Items and will be subject to appropriate adjustment for any failure of Seller to meet the requirements of the Contract. Buyer may set off any amount owed by Seller to Buyer against any amount owed by Buyer in connection with this Contract. If any invoice fails to match the applicable order in regard to price, quantity, revision, delivery terms, or otherwise, the order will prevail.

CHANGES: Buyer may reschedule an order in whole or in part and without penalty, by written notice at any time prior to shipment or commencement of services, and may request changes in the type or quantity of Items ordered, method of shipment or packing, delivery location, schedules, or other requirements of an order by written or electronic communication. Seller must notify Buyer in writing within two business days if it is unable to accept any requested changes; otherwise, Seller will promptly commence all changes as specified. If any change causes a change in the cost of the Items or time required for delivery, an equitable adjustment will be made as mutually agreed. Adjustment claims must be made by Seller within 30 days after receipt of Buyer’s change request.

CANCELLATION: Buyer may cancel any order, in whole or in part (a) for cause and without penalty, if Seller fails to make deliveries as required to meet the Schedules or otherwise breaches or repudiates any term of the Contract, ceases business or production, becomes insolvent, makes an assignment in favor of creditors, or enters bankruptcy, liquidation, or similar procedures; or (b) without cause, if written notice of cancellation is provided at least five days prior to shipment of goods or commencement of services (or any shorter lead time agreed by the parties). If cancellation is without cause, Buyer may be required to pay a cancellation charge equal to Seller’s actual, documented cost of Items fully or partially completed to fulfill the cancelled order(s) prior to receipt of the cancellation notice (excluding interest and overhead), not to exceed the prorated portion of the order(s) cancelled. In no event will Buyer be liable for prospective profits or other indirect or consequential damages. All completed or partially completed Items for which payment is made will be the property of Buyer and held or delivered in accordance with Buyer’s instructions. If cancellation is by Buyer for cause, Buyer may exercise all remedies under this Contract or at law and may take possession of Items from Seller in any stage of completion without judicial process, complete (or contract for completion of) performance, and charge Seller for all costs incurred. Amounts owed to Buyer will, at Buyer’s option, be credited against current invoices or paid by Seller to Buyer within thirty (30) days.

QUALITY; INSPECTION: All Items will be provided in strict conformance with all specifications, samples, drawings, descriptions, documentation, and requirements specified herein and in the order including any documents attached or incorporated by reference (“Specifications”). Seller will provide and maintain adequate quality and inspection systems covering the Items and related materials, processes, tooling, and workmanship, and will make its egulatory submissions, quality systems documentation, and similar compliance and other records available for review and audit by Buyer for a period of not less than 5 years following performance of each order. All Items, and all tooling, equipment, materials, and supplies for their manufacture, may be inspected and tested by Buyer, its customers, higher tier contractors, and the Canadian Government, at all reasonable times and places, including the period of manufacture or performance, and Seller (and approved subcontractors) will provide safe access to all facilities and reasonable assistance as required for such inspections. Inspection will not constitute acceptance or affect Buyer’s rights; all Items remain subject to final inspection and acceptance at the delivery location. Claims by Buyer that Items do not meet Specifications, are not in the quantity ordered, or are defective, inferior in quality, or otherwise not in conformity with Specifications will be communicated to Seller within a reasonable time after discovery, and Buyer will have the right to reject or revoke acceptance of any nonconforming Items, by individual Item(s) or by lot, and require that Seller promptly replace or correct the same at Seller’s expense. If Seller fails to do so, Buyer, in its discretion may (i) by contract or otherwise, replace or correct such Items and charge to Seller the increased cost and related expenses occasioned thereby, or (ii) effect a cancellation for default, subject to reimbursement by Seller of any damages resulting from such failure, including without limitation costs of inspecting, sorting, returning, repairing, or replacing such Items, freight charges for returned and replacement items, and costs or losses associated with resulting production or delivery interruptions.

WARRANTIES: In addition to any other express or implied warranties, Seller warrants that all Items furnished to Buyer will be designed, manufactured, packaged, labeled, and delivered in conformity with Specifications; will be free from defects (including latent defects) in design, materials, and workmanship and suitable for their intended use; will be new and of merchantable quality, and not used, or made of refurbished materials unless approved in writing by Buyer; and will be delivered with good title, free from any liens, encumbrances or other obligations. Seller further warrants that the Items and their use will not violate, or cause Buyer to be in violation of, any federal, provincial, or local law, regulation or order, and do not and will not infringe or violate any third party patent, trademark, copyright, trade secret, or other intellectual property or proprietary rights. These warranties run to Buyer, its customers, resellers, distributors, and end-users, and will survive inspection, testing, acceptance and payment.

REMEDIES: If any Items are not timely delivered or fail to conform to Seller’s warranties, Seller will promptly replace or correct such Items at Seller’s expense, including freight charges for both returned and replacement items, and/or re-perform at Seller’s expense any nonconforming services, so that all Items conform to the requirements of the Contract. If Seller fails or is unable to do so, Buyer, in addition to all other remedies and in its sole discretion, may (i) by contract or otherwise replace or correct such Items at Seller’s expense, (ii) accept the Items subject to a reduction in price reflecting the reduced value attributable to nonconformance; or (iii) effect a cancellation for cause, subject to credit or refund for all non-conforming Items and reimbursement of all losses, costs, and damages resulting from such failure. Seller assumes all transportation and handling costs and risk of damage or loss of nonconforming Items. Items repaired or replaced hereunder will be warranted and subject to inspection to the same extent as Items initially furnished.

SITE WORK: If any Items involve operations by Seller on the premises of Buyer, its affiliates, customers, or end users, Seller will conduct such operations to minimize interference with operations at the site, will comply with all applicable workplace procedures and health, safety and environmental requirements, and will take all necessary precautions to ensure that all work is carried out in a safe and proper manner so as to prevent injury to persons or property.

COMPLIANCE WITH LAWS: Seller will ensure that all Items supplied to Buyer are designed, produced, packaged, labeled, delivered, and furnished in compliance with all applicable federal, provincial, and local laws, regulations, codes, and requirements, including without limitation all applicable requirements pertaining to wages, hours and conditions of employment (including without limitation the Fair Labor Standards Act), subcontractor selection, non-discrimination, and all applicable health, safety and environmental standards and requirements. For Items manufactured outside of Canada, Seller will also ensure compliance with applicable laws in each jurisdiction where production occurs and will ensure that no Items are manufactured or handled by indentured, slave or prison labor or by children under the age of 14 years (or such older age as may be applicable in any jurisdiction). Seller certifies that the Items will not be or include any misbranded or banned hazardous substance within the meaning of the Federal Hazardous Substances Act, that all chemical substances therein will be reported in compliance with all applicable inventory reporting requirements under the Toxic Substances Control Act, and that Seller will comply with the Federal Clean Air Act in regard to ozone depleting chemicals including, without limitation, appropriate marking of any part of Items in which CFC Class I ozone depleting chemicals are used. Seller will notify Buyer whenever it has reason to be aware of any harmful ingredients or defects within or involving any of the Items and, when required by applicable law, will provide material safety data sheets covering the Items. Upon request, or whenever normally provided by Seller, Seller will provide certificates of analysis covering the Items.

CONFLICT-FREE MATERIALS: Lumenera Corporation is committed to being or becoming Democratic Republic of the Congo (“DRC”) conflict free in the procurement of certain materials used in its products. Lumenera Corporation has reporting obligations through its publically traded parent company to disclose whether products it manufactures contain certain “conflict minerals” (cassiterite, wolframite, columbitetantalite, gold or derivatives) originating from the DRC or an adjoining country. Supplier agrees to adopt and implement policies, due diligence frameworks, and management systems to ensure that minerals used in any goods supplied to Buyer are conflict-free. Additionally, Supplier agrees to timely provide, upon Lumenera Corporation’s request and in a requested format, certain data concerning its supply chain that may be needed for applicable reporting obligations.

INTELLECTUAL PROPERTY & PROPRIETARY INFORMATION: Seller will not infringe any copyright, patent, trade mark, or other intellectual property rights of Buyer or any third party, and will pay all royalties or license fees due with respect to the Items or any part thereof. If any Items become the subject of a claim of infringement or misappropriation of third party rights, Seller, at its expense, will either procure for Buyer the right to continue using the Items, replace or modify them so that they are non-infringing, or refund Buyer’s full purchase price. Seller will treat Buyer’s orders as confidential and will not disclose or advertise in any manner that Seller is supplying Items to Buyer without Buyer's prior written consent. All Specifications, designs, drawings, blueprints, tooling, equipment, and other materials and technical, engineering, or other data and/or information furnished by Buyer or developed at its expense, and any trademarks, service marks, trade dress, copyrighted material, or other intellectual property or proprietary information of Buyer or its customers that may be utilized, embodied, or incorporated in the Items or parts thereof (“Proprietary Information”) will be maintained strictly confidential and Seller will (i) employ appropriate safeguards to protect such Proprietary Information and limit its disclosure to its personnel having a need therefor in order to fulfill the order(s) and a written obligation to protect the same from unauthorized disclosure or use; (ii) not reproduce, copy or use Proprietary Information except as strictly required to fulfill Buyer’s orders; and (iii) use the same only for the benefit of Buyer and not for Seller’s own use or for third parties. Seller acknowledges that any breach of this Section may cause Buyer irreparable harm for which recovery of damages would be inadequate, and that immediate injunctive or other equitable relief is appropriate and available to Buyer to prevent any violation, threatened or actual, in addition to all other remedies.

INDEMNIFICATION & INSURANCE: Seller agrees to indemnify and hold harmless Buyer, its affiliates, contractors, agents, customers, and end users of the Items, from and against all claims, suits, losses, liabilities, damages, judgments, penalties, costs, and expenses, including without limitation attorneys’ fees and expenses, arising out of or relating to (i) any defect or alleged defect in the design, materials, manufacture, or sale of the Items, (ii) any claim that any Item, or the manufacture, license, marketing, distribution, sale, or use thereof, infringes upon or misappropriates a patent, copyright, trademark, trade secret, or other proprietary right of any third party, or (iii) any breach of this Contract, or any negligent or willful acts or omissions of Seller, its employees, agents, contractors, consultants, or representatives in connection with the performance of this Contract, including without limitation claims for bodily injury (including death) or property damage, and costs of any recall or corrective action required as a result or arising out of any nonconforming Items. Seller will maintain at all times workers’ compensation, comprehensive general liability (including products/completed operations and contractual liability), automobile, public liability, property damage, and other appropriate insurance in accordance with good industry practice and in amounts sufficient to cover its activities and obligations under this Contract and, upon Buyer’s request, will name Buyer as an additional insured. All such insurance will be primary coverage and Seller waives, and will cause its insurers to waive, all rights of subrogation against Buyer.

GENERAL PROVISIONS: These Terms, all transaction to which they may apply, and any disputes arising out of Goods supplied hereunder, will be governed by and construed in accordance with the laws of the Province of Ontario, Canada, without giving effect to any conflict of law provisions thereof. The United Nations Convention on Contracts for The International Sale of Goods, the Uniform Law on the Formation of Contracts for the International Sale of Goods, and any international discovery and service of process conventions will be inapplicable. All provisions of the Contract are severable, and the unenforceability or invalidity of any provision will not affect the validity or enforceability of the remaining terms. Section headings are solely for convenience and will not affect the interpretation hereof. Buyer’s rights and remedies are cumulative and in addition to all rights and remedies at law or in equity, and Buyer is entitled to recover from Seller all reasonable attorneys’ fees and costs incurred as a result of any Seller default. No course of dealing or failure by Buyer to exercise any right or insist upon strict compliance hereunder will constitute a waiver of Buyer’s right to demand strict compliance. Any waiver must in writing and signed by an authorized officer of Buyer, and will not constitute a waiver of any other or subsequent breach. In the event of any conflict, the terms of the order will govern over any conflicting terms herein, and the Specifications in the order will govern over any conflicting literature, descriptions and/or samples. Seller will not assign, delegate, or subcontract any of its rights or duties under the Contract or any order without Buyer’s prior written consent.