CNC Machining

Standard Terms and Condition of Purchase

1. DEFINITIONS. "Company" shall mean Metalworking Group Holdings, Inc. "Seller" shall mean any vendor, supplier or other seller as described in any purchase order submitted by the Company to such Seller.

2. EFFECT OF TERMS AND CONDITIONS. The terms and conditions contained herein shall apply to all purchases of products, equipment, services, parts, raw materials or other goods (collectively, the "Goods") made by the Company and shall also be applicable to any purchase order submitted by the Company to Seller. These terms and conditions shall supersede all prior oral or written statements or documents made with respect to the subject matter contained herein. The terms and conditions contained herein shall also supersede any terms or conditions contained in any proposal, quotation, invoice, order acknowledgment or other communication provided by Seller to the Company. Any terms or conditions not specifically contained herein shall be inapplicable to any purchase of Goods by the Company from Seller.

3. ACKNOWLEDGMENT OF ORDERS. Seller shall, within five (5) business days of the receipt of any purchase order from the Company, issue to the Company a written order acknowledgment verifying the complete agreement to all information contained in such purchase order, including but not limited to pricing, technical specifications, quantities, delivery schedules and delivery terms, or if rejected, a written explanation of the reason for such rejection. In the event Seller should fail to issue an order acknowledgement to the Company or otherwise issue a written rejection of such order to the Company within the 5-day period referenced in this Section, then Seller shall be deemed to have accepted such purchase order and all of the terms and conditions contained therein.

4. PRICING INCREASES. Following such time as Seller accepts an order under Section 3 above (whether by Seller's issuance of an order acknowledgment or otherwise), no increase in the pricing for the Goods shall be binding unless in writing and signed by the Company.

5. ORDER FULFILLMENT AND MANUFACTURING. Seller agrees to manufacture and/or supply the Goods to the Company in strict accordance with the specifications, quantities and other terms (collectively, the "Specifications") provided to Seller by the Company in the associated purchase order. No changes to the Specifications shall be effective unless in writing and signed by the Company. If the Goods ordered by the Company require manufacturing or fabrication, Seller agrees to commence such manufacturing as soon as is commercially possible following the time that Seller accepts an order under Section 3 above (whether by Seller's issuance of an order acknowledgment or otherwise); provided, however, that in the event Seller has not begun manufacturing such Goods within fifteen (15) days, such order shall be deemed cancelled by the Company and the Company shall bear no responsibility or liability to Seller therefor.

6. DELIVERY. Compliance with the delivery schedule and delivery terms stated in any order accepted by Seller under Section 3 above is essential and is guaranteed by Seller. Time is of the essence with respect to the Goods and the delivery of such Goods. Unless otherwise stated in any purchase order submitted by the Company to Seller, all Goods purchased by the Company hereunder will be shipped F.O.B. point of destination at the Company's place of business. Title to, right of possession, and risk of loss or damage to such Goods shall pass from Seller to the Company only upon the Company receiving actual possession of such Goods from any common carrier. Seller shall be responsible for insuring all shipments of the Goods and shall also be responsible for making any and all claims with any common carrier resulting from delay, non-delivery, damage or loss to the Goods shipped. The Company shall be responsible for all reasonable shipping costs associated with Goods shipped hereunder; provided, however, that the Company shall not be responsible for any payment, whether for shipment or for the Goods, until such Goods have safely arrived at the Company's place of business and the Company has had a reasonable opportunity to inspect to the Goods for defects under Section 8 below.

7. WARRANTY. In addition to any warranty provided by Seller to its customers, Seller represents and warrants to the Company (i) that all Goods delivered to the Company hereunder have been manufactured and/or supplied in strict accordance with the Specifications, (ii) that all Goods delivered to the Company are new unless otherwise stated in any purchase order submitted by the Company, (iii) that all Goods delivered to the Company are of good quality and workmanship, (iii) that all materials used to make or supply the Goods are of good and new quality, and (iv) that all Goods are free from defect at the time of delivery to the Company.

8. INSPECTION AND ACCEPTANCE OF GOODS. At such time as any Goods are delivered to the Company's place of business, the Company shall have a right before acceptance to inspect the Goods in a reasonable time and manner. Expenses associated with such inspection shall be the responsibility of the Company but may be recovered from Seller if the Goods are nonconforming. The Company may, without limiting any other remedies available to the Company under law or otherwise, refuse to accept and return, at Seller's expense, any nonconforming Goods or correct any nonconforming Goods, at Seller's expense. Prior to inspection, payment for any Goods shall not be construed as constituting acceptance of such Goods by the Company, and acceptance shall not be construed to relieve Seller of any of its warranty obligations under Section 7 above; provided however, that if the Company fails to reject any Goods purchased and shipped under this hereunder within ten (10) days of receipt, the Company shall be deemed to have accepted such Goods.

9. PAYMENT. The Company shall make payment to Seller for any Goods purchased hereunder within forty-five (45) days from the date that the date that the Company accepts such Goods under Section 8 above.

10. GENERAL CONDITIONS. (a) No modification, amendment, rescission, discharge, abandonment or waiver of these terms and conditions shall be binding upon the Company unless set forth in writing and signed by the President or a Vice President of the Company. (b) Neither party may assign these terms and conditions without the written consent of the other party, except that the Company may assign these terms and conditions without Seller's consent to any company with which the Company merges or to which the Company sells all or substantially all of its assets. (c) These terms and conditions shall be governed by and construed in accordance with the laws of the State of Ohio, and any contract resulting herefrom shall be deemed to be made in the State of Ohio, and Seller and the Company hereby consent to the exclusive jurisdiction of the courts of the State of Ohio located in Hamilton County, with respect to any controversy or claim arising out of, or relating to, any contract resulting from these terms and conditions.

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