Pacific Combustion Terms and Conditions

STANDARD TERMS AND CONDITIONS

Sale of any of the materials or equipment described or referred to in this sales agreement is expressly conditional upon the terms and conditions set forth below. Any additional or different terms and conditions shall not be effective or binding unless assented to in writing by an authorized representative of Pacific Combustion Engineering Company, a California corporation (the “Company”).

QUOTATIONS AND ACCEPTANCE OF ORDERS

Prices quoted are binding upon the Company unless otherwise stated for thirty (30) days from the day of quotation. Orders placed with the Company, are subject to acceptance by the Company in Torrance, CA, and when accepted, constitute a sales agreement made in California. Prices on all materials and equipment shipped more than ninety (90) days from the date of Company’s acknowledgment of the order for such materials or equipment may be increased if necessary to cover increased costs of labor and material incurred by Company unless otherwise agreed to in writing.

CANCELLATION POLICY

FOR CUSTOM ORDERS, NO CANCELLATIONS ARE ALLOWED AFTER PRODUCTION HAS BEGUN. In addition, the Purchaser will be responsible for all engineering hours that have accrued as well as covering the cost of any/all parts that were purchased specifically for their job. All cancellation requests must be made in writing by an authorized representative of the Purchaser and for standard products and equipment, any cancellation shall be subject to a restocking fee of twenty-five percent (25%).

DELAYS

SHIPPING DATES STATED IN THIS SALES AGREEMENT ARE APPROXIMATE. The Company shall not be liable for delays in delivery, or in performance or failure to manufacture or deliver, due to: (1) causes beyond its reasonable control, (2) acts of God, acts of the Purchaser, acts of civil or military authority, priorities, fires, strikes or other labor disturbances, floods, epidemics, war, riot, delays in transportation or car shortages, or (3) inability on account of causes beyond reasonable control of Company’s supplier to obtain necessary labor, materials, components or manufacturing facilities. In the event of any such delay, the date of delivery or of performance shall be extended for a period equal to the time lost by reason of the delay.

PAYMENTS

Payments of the purchase price stated herein shall be due and payable within thirty (30) days after receipt of the Company’s invoice which shall be rendered upon shipment of the materials or equipment ordered. If shipment is delayed by the Purchaser, Company’s invoice shall be rendered on the date when Company is prepared to make shipment. Materials or equipment held for the Purchaser shall be at the risk and expense of the Purchaser. Unpaid balances of past due accounts will incur late penalty interest charges of twelve percent (12%) per annum, plus all applicable collection fees, including without limitation attorneys’ fees and court costs.

SALES AND SIMILAR TAXES

The Company’s prices include sales, use, excise or similar taxes, as appropriate. Consequently, in addition to the price specified in this sales agreement, the amount of any present or future sales, use, excise or similar tax applicable to the sales or use of the materials or equipment thereunder shall be paid by the Purchaser; or in lieu thereof, the Purchaser shall provide the Company with a tax exemption certificate acceptable to the taxing authorities.

PACKING AND SHIPPING

Prices are quoted exclusive of shipping charges. Packing and shipping charges shall be quoted separately, as applicable. Unless otherwise stated, the FOB point is manufacturing facility. Delivery to common carrier or postal authorities by manufacturer shall constitute delivery to the Purchaser, who shall thereafter be responsible for delays, loss, or damage in transit. All deliveries shall be subject to Company’s standard Delivery and Receipt Procedures.

LIMITATION OF LIABILITY

The Company’s liability on any claim of any kind, including negligence, or any loss or damage, personal injury or death arising out of, connected with, or resulting from, this sales agreement or from the performance or breach thereof, or from the design, manufacture, sales, delivery, resale, installation repair, operation or use of any materials or equipment covered by or furnished under this agreement shall in no case, exceed the purchase price of the materials or equipment which gives rise to the claim. IN NO EVENT, WHETHER AS A RESULT OF BREACH OF CONTRACT OR WARRANTY OR ALLEGED NEGLIGENCE, SHALL THE COMPANY BE LIABLE FOR SPECIAL OR CONSEQUENTIAL DAMAGES INCLUDING, BUT NOT LIMITED TO, LOSS OF PROFITS OR REVENUE, LOSS OF USE OF MATERIALS OR EQUIPMENT OR ANY OTHER MATERIALS OR EQUIPMENT, COST OF CAPITAL, COST OF SUBSTITUTE MATERIALS OR EQUIPMENT, FACILITIES OR SERVICES, DOWNTIME COSTS, OR CLAIMS OF CUSTOMERS OF THE PURCHASER FOR SUCH DAMAGE.

LIMITED WARRANTY

Company warrants that the materials or equipment will operate or perform substantially in conformance with manufacturer’s published specifications and be free from defects in material and workmanship, when subjected to normal, proper and intended usage by properly trained personnel, for the period of time set forth in the product documentation, published specifications or package inserts. If a period of time is not specified in manufacturer’s product documentation, published specifications or package inserts, the warranty period shall be one (1) year from the date of shipment to Purchaser for equipment and ninety (90) days for all other materials (the “Warranty Period”). Company agrees during the Warranty Period, to repair or replace, at Company’s option, defective equipment or materials so as to cause the same to operate in substantial conformance with said published specifications, provided that Purchaser shall (a) promptly notify Company in writing upon the discovery of any defect, which notice shall include the product model and serial number which may include biohazard contamination procedures and other product-specific handling instructions, then, if applicable, Purchaser may return the defective equipment or materials to Company with all costs prepaid by Purchaser. Replacement parts may be new or refurbished, at the election of Company. All replaced parts shall become the property of Company. Shipment to Purchaser of repaired or replacement equipment or materials shall be made in accordance with the Delivery provisions of Company’s standard terms and conditions. Consumables are expressly excluded from this warranty.

Materials or equipment supplied by Company to Purchaser are not warranted by Company, but Company agrees to assign to Purchaser any warranty rights in such materials or equipment that Company may have from the original manufacturer or third party supplier.

In no event shall Company have any obligation to make repairs, replacements or corrections required, in whole or in part, as the result of (i) normal wear and tear, (ii) accident, disaster or event of force majeure, (iii) misuse, fault or negligence of or by the Purchaser, (iv) use of the equipment or materials in a manner for which they were not designed, (v) causes external to the equipment or materials such as, but not limited to, power failure or electrical power surges, (vi) improper storage and handling of the equipment or materials or (vii) use of the equipment or materials in combination with equipment or software not supplied by Company. Any installation, maintenance, repair, service relocation or alteration to or of, or other tampering with, the products performed by any person or entity other than Company without Company’s prior written approval, or any use of replacement parts not supplied by Company, shall immediately void and cancel all warranties with respect to the affected products. Heating elements, thermocouples and retorts are excluded from this warranty because the Company has no control over the temperatures and environments to which the elements, thermocouples, insulation packs, or retorts may be exposed during operation.

GENERAL

The Purchaser shall not be entitled to assign the order or any part of it without the prior written consent of the Company.

Each right or remedy of the Company under the order is without prejudice to any other right or remedy of the Company.

If any provision of these Terms and Conditions is found by any court, tribunal or administrative body of competent jurisdiction to be wholly or partly illegal, invalid, void, voidable, unenforceable or unreasonable, it shall to the extent of such illegality, voidness, voidability, unenforceabilty or unreasonableness, be deemed severable and the remaining provisions of these Terms and Conditions shall continue in full force and effect.

Failure or delay by the Company in enforcing or partially enforcing any provision of these Terms and Conditions will not be construed as a waiver of any of its rights under these Terms and Conditions.

The formation, existence, construction, performance, validity and all aspects of any contract between Purchaser and Company shall be governed by the law of the state of California and the parties submit to the exclusive jurisdiction of courts of that state.

Any legal presumption that these Terms and Conditions be strictly construed against the party who drafted such terms or who benefits from such terms shall not be employed in construing and interpreting these Terms and Conditions.

If you have any questions, please contact us immediately at Tel. (310) 2126300 or Fax (310) 212-5333.

Pacific Combustion Engineering Company, 2107 Border Avenue, Torrance, CA 90501

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