DEFINITIONS. (a) BUYER means Albany Safran Composites, LLC and/or, as applicable. (b) Goods means any good or service specified in the Purchase Order or Order or Agreement to be delivered by SELLER to BUYER. (c) Order or Purchase Order or Agreement (used interchangeably herein) means the document utilized by BUYER to place an order with SUPPLIER for the goods and/or services as therein described and incorporates by reference these Standard set forth herein. (d) SELLER or SUPPLIER means the contracting party with whom the Order is placed. In the event of a conflict between these Standard and the Purchase Order, the terms of the Purchase Order shall prevail. 1. ACCEPTANCE. The Purchase Order attached hereto and issued by BUYER to SUPPLIER is an offer by BUYER, which shall become a binding contract on the terms contained therein and herein when accepted by SUPPLIER. SUPPLIER shall indicate acceptance of the Purchase Order on the express terms hereof by (i) written acceptance of the Purchase Order without exception; (ii) commencing work on the Goods or providing the services which are the subject of the Purchase Order; or (iii) shipment of the Goods which are the subject of the Purchase Order. THE ORDER MAY BE ACCEPTED ONLY ON THE TERMS SET FORTH THEREIN AND ANY TERMS IN THE SELLER S ACCEPTANCE OR ACKNOWLEDGEMENT IN ADDITION TO OR NOT IDENTICAL WITH THE TERMS IN THE ORDER ARE HEREBY OBJECTED TO AND REJECTED BY BUYER AND WILL NOT BECOME PART OF THE AGREEMENT UNLESS AGREED TO IN WRITING BY BUYER S AUTHORIZED PERSONNEL. 2. PACKING. All Goods shall be packed and shipped by SELLER in accordance with BUYER S instructions and good commercial practice to insure protection and prevent damage to the Goods. Goods will be shipped with a certificate of conformance and test results, as applicable. SELLER shall be responsible for all damage caused by nonconforming packaging. Prices include all charges for SELLER S packing and crating. Shipments of any hazardous materials or substances must be packaged and transported in compliance with all applicable U.S. laws and regulations. 3. CHARGES, TAXES AND DELIVERIES. Except as otherwise provided in the Purchase Order, the price(s) set forth in all invoices shall include all applicable taxes, import and export duties, impositions, and other similar charges. SELLER warrants that the price to be charged for the Goods covered in the Order will not exceed the prices charged others under comparable conditions. SELLER shall refund any excessive amount paid by BUYER. All sales, excise or other taxes and charges to be paid by BUYER shall be separately itemized on the invoice. If requested by BUYER by written notification to SELLER, invoices will contain SELLER S certification that all goods and services reflected in the invoice were produced and supplied in compliance with the requirements of the Fair Labor Standards Act of 1938, as amended and the regulations and orders of the United States Department of Labor issued thereunder. Except as otherwise provided in the Purchase Order, SELLER agrees to use BUYER approved carriers for all deliveries. All deliveries shall be Exworks origin (Incoterms 2010). All deliveries shall be in conformance with the delivery schedule and routing instructions as set forth in the Purchase Order. SELLER shall notify BUYER immediately, if Purchase Order delivery requirements cannot be met. The parties hereby agree that time is of the essence and if SELLER S deliveries fail to meet the schedules specified by BUYER and BUYER is compelled to ask SELLER to ship by other than the designated routing to expedite delivery, SELLER shall assume the difference for the additional cost of transportation. Unless authorized in writing to the contrary by BUYER, SELLER shall not manufacture, produce or deliver the Goods in advance of the schedule or otherwise anticipate BUYER S requirements. If SELLER anticipates a delay in delivery, SELLER shall notify BUYER, in writing, as soon as reasonably possible. 4. INSPECTION, ACCEPTANCE, REJECTION. BUYER, its customer and/or any governing regulatory agency shall have the right to inspect all Goods, raw materials and work-in-progress at any time during normal business hours either at the SELLER S manufacturing and storage facilities, and SELLER S sub-tier SUPPLIERS facilities. Notwithstanding any prior payment or inspection by BUYER or that title may have passed to BUYER, all Goods shall be subject to final inspection and acceptance by BUYER at BUYER S facility. If at any time any of the items are found to be defective in material or workmanship or not in conformity with Purchase Order or Agreement, BUYER may, in addition to any other rights it may have under the Purchase Order or otherwise (i) correct or have corrected the nonconformity at the SELLER S expense, or P a g e 1 o f 6
reject and return such nonconforming good to SELLER, and (ii) recover by offset or otherwise any and all costs, expenses and damages paid, incurred, or suffered by BUYER as a result or relating to holding, return, replacement, correction or rejection of such nonconforming item. Without limiting other rights BUYER may have under the Purchase Order, including BUYER s warranty rights, as set forth in Article 5, below, or by law resulting by SELLER S delivery of defective Goods, Goods not conforming to this Order may be rejected by BUYER. BUYER shall have the right to hold or return to SELLER all or a portion of such non-conforming Goods at SELLER S sole risk and expense for a full credit or refund. If SELLER fails to correct or replace any nonconforming Goods promptly after notification and authorization from BUYER, BUYER may charge SELLER for costs incurred by BUYER thereby, equitably adjust the Order price for such Goods, or set-off the cost hereunder, at the sole discretion of BUYER. Delivery of nonconforming Goods rejected by BUYER shall not be deemed to satisfy the delivery schedule required herein nor shall acceptance of any item be deemed to alter or affect the obligation of SELLER or the rights of BUYER under Article 5, below. 5. WARRANTY PRODUCT. SELLER warrants that all Goods, supplies, and services furnished hereunder shall be free from defects in material and workmanship and that all items furnished will conform to applicable specifications, drawings, samples and/or other descriptions, and will be free from all liens and encumbrances. SELLER assumes design responsibility and warrants the items to be suitable for the purposes intended. The warranties described in this Article 5 shall begin after BUYER S final acceptance and continue for a period of thirty-six (36) months thereafter. If a Good or service does not conform to the warranty specified herein, then BUYER may, at its option, either (i) return for credit or refund; or (ii) require prompt correction or replacement of the defective or non-conforming part. The warranties of SELLER together with its service warranties and guarantees shall run to BUYER, its assigns and each successive customer. In addition, SELLER agrees to pass any warranty benefits to BUYER that SELLER receives from its SUPPLIERS of any item ordered hereunder. 6. PATENT INDEMNITY: SELLER shall indemnify, defend and hold harmless BUYER, its customers and their respective successors or assigns, from any and all damages, awards, liabilities, costs, and/or attorney fees, and BUYER shall conduct (at SELLER S sole cost and expense) the entire defense of any claim, suit, or action alleging that the manufacture, use, or sale of the Goods infringes the intellectual property rights of a third-party. 7. PROPRIETARY INFORMATION. All information disclosed or furnished by BUYER to SELLER under this Agreement, regardless of form or format, and including, but not limited to, designs, models, processes, drawings, specifications, reports, data, trade secrets, software, know-how, and other technical or business information and the features of all parts, equipment, tools, gauges, patterns, and other items furnished or disclosed to SELLER by BUYER, and all information created, developed or made by SELLER in the performance of this Agreement is and shall be treated by SELLER as proprietary information of BUYER ( Proprietary Information ). Unless otherwise provided herein or authorized by BUYER in writing, SELLER shall hold all Proprietary Information in confidence, and shall use Proprietary Information only in the performance of the Agreement. This clause shall survive the performance, completion, expiration and/or termination, of the Agreement or any Purchase Order or Order. 8. TERMINATION. For Default. (1) BUYER may terminate this Order in whole or in part by written notice to SELLER in any of the following circumstances: a. If SELLER refuses or fails to make deliveries, including any installment thereof, or perform the services within the time specified in the Purchase Order or extension thereof granted by BUYER. b. If SELLER fails to comply with other provisions of this Order, including, but not limited to, specified quality requirements, or fails to make progress as to endanger performance of this Order in accordance with its terms, and does not cure any such failure within a period of thirty (30) days or such longer period as BUYER may authorize by written notice after receipt of notice from BUYER specifying such failure. c. If SELLER becomes insolvent, or makes a general assignment for the benefit of creditors, or pursues any remedy under any law relating to relief for debtors, or in the event a receiver is appointed for SELLER S property, or becomes subject to any law relating to bankruptcy, insolvency, or relief of debtors, to the extent BUYER may lawfully exercise such right of termination. P a g e 2 o f 6
(2) In addition to the foregoing termination rights, as well as all other rights and all remedies available to BUYER under applicable law, upon the occurrence of any event described in Section 8(1), above, BUYER shall have the right to purchase or manufacture similar Goods without further payment to SELLER and/or require SELLER to transfer title and deliver to BUYER in a manner directed by BUYER any and all property produced or procured by SELLER under this Order including, but not limited to, materials, parts, tools, dies, plans, drawings, services, Agreement rights, and other property and technical data, and SELLER shall be liable to BUYER for any excess cost to BUYER. For Convenience. BUYER may terminate this Order in whole or in part at any time for its convenience, by notice to SELLER in writing, such termination effective thirty (30) days from the date of such notice. Upon SELLER S receipt of such notice, SELLER shall to the extent specified therein, stop work and the placement of subcontracts hereunder, terminate work under subcontracts outstanding thereunder, and take any necessary action to protect property in SELLER s possession in which BUYER has or may acquire an interest. SELLER shall submit a termination claim within thirty (30) days after the effective date of termination notice incorporating all claims of SELLER. The amount to which SELLER shall be entitled upon complete termination of the Purchase Order shall be determined by the parties hereto as being a fair and reasonable amount for the effort performed prior to the date of notice of termination. BUYER may deduct any amounts due to BUYER from SELLER from the amount to be paid by SELLER on other open Purchase Orders. In no case shall BUYER be responsible for items procured or manufactured in advance of lead-time. Any termination by BUYER, whether for default or otherwise, shall be without prejudice to any claims for damages or other rights of BUYER against SELLER. BUYER shall have the right to audit all elements of any termination claim and SELLER shall make available to BUYER on request all books, records, and papers relating thereto. SELLER shall continue performance of this Order to the extent not terminated. 9. STOP WORK. BUYER may, at any time by written order to SELLER, order SELLER to stop work, in whole or in part, for a period of up to ninety (90) days. Upon receipt of such stop-work order, SELLER shall comply with the terms of such order and shall take all reasonable steps to minimize the incurrence of costs allocable to the work covered by the order during the period of work stoppage. Within said ninety (90) day period, BUYER shall either cancel the stop-work order or terminate the work covered by the stop-work order. In case of termination, the terms of Article 8 shall apply. In the event of a continuation of the work, equitable adjustment shall be made to the price, delivery, schedule, or other provision affected by the work stoppage, provided the claim for equitable adjustment is made within thirty (30) days after said continuation. 10. CHANGES: (A) BUYER may at any time by written order to SELLER signed by an authorized representative of BUYER S Purchasing department and without notice to sureties, if any, make changes in the quantities ordered or in the specifications or drawings or in the delivery schedule relating to the Goods, or may change or amend any other term or condition of this Order. (B) SELLER shall comply immediately with such changes in accordance with the terms of such written order. An equitable adjustment shall be made to any price, time of performance, or other provisions of this Order required by BUYER s changes to this Order, and this Order shall be amended in writing accordingly. Any claim for adjustment under this clause must be made in writing within thirty (30) days from the date of receipt by SELLER of such change. In absence of such notification, BUYER shall not be obligated to consider SELLER S claim for an equitable adjustment resulting from a change. Nothing in this clause shall excuse SELLER from proceeding with the order as changed. (C) Except as may be directed or agreed to in writing by an authorized representative of BUYER S Purchasing department, SELLER shall not make any changes in any aspect of the work to be performed under this Order, including, but not limited to drawings or specifications, quantity of Goods ordered and delivery schedules. 11. COMPLIANCE WITH LAWS: (A) SELLER warrants that performance of work under this Order complies with all federal, state and local laws, executive regulations and orders. SELLER shall certify that the Goods were produced in compliance with all applicable requirements of the Fair Labor Standards Act, including sections 6, 7 and 12 thereof, and the regulations and order of the U.S. Department of Labor issued under section 14 thereof. P a g e 3 o f 6
(B) The Equal Employment Opportunity Clause in Section 202 of Executive Order 11246, as amended, the Affirmative Action Clauses in Section 402 of the Vietnam Era Veterans Readjustment Assistant Act and Section 503 of the Rehabilitation Act, and the implementing rules and regulations of the Office of Federal Contract Compliance Programs relative to equal employment opportunity are incorporated herein by specific reference. 12. INDEMNITY AND INSURANCE: SELLER hereby agrees to indemnify and hold harmless BUYER and its officers, directors, affiliates, and employees from any cost, damage, expense or other loss or liability incurred or paid, arising out of or on account of claims or suits, whether in law or equity, which may be asserted or brought against any of the indemnified parties hereunder, for property damage or destruction, personal injury or death or any other damages of whatsoever nature or kind including claims of consequential loss and breach of Agreement, in any way related to SELLER s work, its products, or its workmanship or the actions or omissions of the SELLER or its employees, agents, or subcontractors, except for claims arising through the claimed sole and exclusive negligence of BUYER. Whenever SELLER, by virtue of this Order, shall have in its possession property of BUYER, SELLER shall be deemed an insurer thereof and shall be responsible for its safe return to BUYER. SELLER shall, at its own expense, procure and maintain in full force and effect during the performance of its obligations hereunder, through companies and agencies reasonably satisfactory to BUYER, and in such specific forms as shall be reasonably required by AEC insurance amounts as provided below: Automobile Liability $1,000,000 per occurrence (including non-owned auto and under insured motorists) General Liability $1,000,000 per occurrence and $3,000,000 in aggregate (to include products and completed operations) Worker s Compensation Part A: Statutory Limits and Part B: $1,000,000 bodily injury by accident; $1,000,000 bodily injury by disease (each employee); and $1,000,000 bodily injury by disease (policy limit aggregate) Seller warrants to BUYER that Seller has the aforesaid insurance coverage in effect and shall provide AEC with certificates evidencing the aforesaid insurance coverages before commencing the delivery of the Goods pursuant to this Agreement. Seller shall provide BUYER with thirty (30) days prior written notice to the effective date of any cancellation or change in the term or coverage of any of SELLER S required insurance, provided however that such notice shall not relieve SELLER of its obligations to maintain the required insurance. SELLER shall name BUYER as an additional insured commercial general liability and automobile liability policies for the duration of this Order and provide a waiver of subrogation on the Workers Compensation/Employer Liability Limits. Specialty vendors/contractors may be required to carry additional insurance such as higher Liability Limits, Pollution Liability, Professional Errors and Omissions or Contractors Liability as deemed necessary by BUYER. If requested by BUYER, SELLER shall provide BUYER with a Certificate of Insurance. Insurance maintained pursuant to this clause shall be considered primary as respect to the interests of BUYER and is not contributory with any insurance which BUYER may carry. 13. RISK OF LOSS. Unless otherwise provided in the Order, SELLER shall bear risk of loss or damage to the Goods purchased hereunder until they are delivered in conformity with the Purchase Order, Exworks (Incoterms 2010) SELLER S dock, as specified herein and upon such delivery SELLER S responsibility for loss or damage shall cease, except for loss or damage resulting from SELLER S negligence or failure to comply with the terms of the Agreement, Order or Purchase Order. Title shall transfer from SELLER to Buyer upon receipt of the Goods at Buyer s dock. 14. SETOFF. BUYER may set off any amount due from SELLER whether or not under this Order, against any amount due SELLER hereunder. 15. NON ASSIGNMENT. SELLER shall not assign this Order or any interest herein, including any payment due or to become due with respect thereto, without BUYER S prior written consent. 16. SUBCONTRACTING. If any Goods are to be made to BUYER S design, all subcontracting by SELLER with respect thereto shall be subject to BUYER S prior written approval. P a g e 4 o f 6
17. ADVERTISING. SELLER shall not advertise or publish the fact that the BUYER has placed this Order without BUYER S prior written consent except as may be necessary to comply with a proper request for information from an authorized representative of the Government. 18. CONFIDENTIALITY. SELLER and BUYER each agree that the terms of this Purchase Order are confidential unless otherwise agreed to in writing. SELLER and BUYER each agree to limit disclosures of the terms of this Purchase Order only to those who have a need to know within their own organizations, outside auditors, outside advisors, and government agencies. 19. EXPORTS. SUPPLIER and BUYER shall comply with the laws and regulations of the United States of America (USA) relating to exports and foreign transactions, including, but not limited to, the International Traffic in Arms Regulations (ITAR) (22 C.F.R. Parts 120-130), the Arms Export Control Act (22 U.S.C. 2778), the Export Administration Regulation (EAR) (15 C.F.R. Parts 730-774) and the Export Administration Act of 1979, as amended (50 U.S.C. 2401 et. Seq.). In particular, the Parties shall not disclose any technical data, nor deliver, export, re-export or re-transfer any Product out of the USA, or to foreign persons or entities within or outside the USA, without prior review and determination by BUYER and the proper written authorization and/or license from the U.S. Government. SUPPLIER hereby indemnifies and agrees to hold BUYER harmless from any costs, damages, penalties, attorney s fees and similar expenses of BUYER due to SUPPLIER S breach of such obligation. Any governmental license, approval or notification required for export shall be the responsibility of the SUPPLIER. The Parties shall reasonably cooperate with each other in obtaining all required export and import licenses, approvals and/or notifications pursuant to such U.S. laws. 20. REACH. Seller represents, warrants and undertakes, at its sole cost, to supply Goods under this Purchase Order in compliance with European Union Regulation Number 1907/2006 concerning the Registration, Evaluation, Authorization and Restriction of Chemicals (REACH), or any similar law or regulation adopted by any country or jurisdiction in the world, which would prevent or restrict the sale or transport of the Goods. Upon request, SELLER shall timely provide BUYER with information regarding the chemical composition of the Goods, including information regarding the registration with, authorization by, or notifications to the European Chemical Agency under REACH. Without the need for a request by BUYER, SELLER shall notify BUYER of any chemical substances contained in the Goods which are listed in Annex XIV of REACH (i.e., Substances of Very High Concern), as that annex may be amended or supplemented. 21. CONFLICT MINERALS. Seller represents, warrants, and undertakes, at its sole cost to supply Goods under the Purchase Order in compliance with the Conflict Minerals provision (Section 1502) of the Dodd-Frank Wall Street Reform and Consumer Protection Act. Supplier commits to have in place a supply chain policy and processes to undertake (i) a reasonable inquiry into the country of origin of Conflict Minerals incorporated into products it provide to AEC; (ii) due diligence of its supply chain, following a nationally or internationally recognized due diligence framework, as necessary, to determine if Conflict Minerals sourced from the Democratic Republic of the Congo and adjoining countries directly or indirectly support unlawful conflict there; and (iii) risk assessment and mitigation actions necessary to implement the country of origin inquiry and due diligence procedures. 21. CONTROLLING LAW. SELLER and BUYER agree that this Purchase Order will be governed by and construed and enforced in accordance with the substantive laws of the State of New York, except that the United Nations Convention on Contracts for the International Sale of Goods will not apply. The parties agree to the exclusive jurisdiction of the state and federal courts of general jurisdiction of the State of New York and agree not to commence any suit or proceeding, whether directly or indirectly relating or arising from this Purchase Order, except in such courts. 22. NOTICE OF LABOR DISPUTES. Whenever an actual or potential labor dispute is delaying or threatens to delay the timely performance of this Order, SELLER shall immediately give notice thereof, including all relevant information with respect thereto, to BUYER. Any subcontract hereunder as to which a labor dispute may delay the timely performance of this Order, shall provide that in the event its timely performance is delayed or threatened to be delayed by any actual or potential labor dispute, the subcontractor shall immediately notify SELLER of all relevant information with respect to such dispute. 23. NON WAIVER. No waiver of any provision or failure to perform any provision of this Order shall be effective unless consented to by BUYER in writing nor shall any such waiver constitute a waiver of any other provision or failure to perform. P a g e 5 o f 6
24. RECORDS RETENTION. SUPPLIERs are required to maintain all records generated as a result of this purchase order in accordance with industry standards but for no less time than the life of the program the Purchase Order is supporting. 25. ADDITIONAL SELLER REQUIREMENTS. SUPPLIER shall notify BUYER of (i) changes in their product or processes; (ii) changes from their suppliers; (iii) changes of manufacturing locations; and (iv) notification of nonconforming Goods prior to shipment. All such changes shall be approved by BUYER prior to being implemented. If Seller determines, after shipment, that non-conforming product was shipped to Buyer, then Seller will immediately notify Buyer of such nonconforming product. SELLER shall flow down to sub-tier suppliers the applicable requirements in the purchasing document, including key characteristics when required. BUYER, their customers, and regulatory authorities shall have the right of access to all facilities involved in the Order and to all applicable records. 26. MANDATORY CLAUSES REQUIRED UNDER GOVERNMENTAL CONTRACTS OR SUBCONTRACTS. If a government contract number is shown on the purchase order, clauses contained in the Armed Services Procurement Regulation, or other applicable federal law or regulation and which the government makes mandatory for a contractor under a government contract to include in it subcontracts thereunder, will apply to this Order. 27. ENTIRE AGREEMENT, AMENDMENT. Provisions contained herein constitute the entire agreement and supersede all previous communications, representations, either verbal or written, between the parties hereto with respect to the subject matter hereof. This agreement may not be changed, altered, supplemented or added to at any time except by supplemental written agreement. P a g e 6 o f 6