BAUER COMPRESSORS, INC. (hereinafter referred to as BAUER) shall not be bound by these terms and conditions (“Terms”) and the purchase order printed on the reverse side of these Terms (the Terms and such purchase order, collectively, the “Purchase Order”) until Seller executes and returns to BAUER the confirmation copy of this Purchase Order, or BAUER accepts Seller’s confirmation copy of this Purchase Order.  Seller shall be bound by the Purchase Order when it executes and returns the confirmation copy, or delivers or renders to BAUER any of the goods or services ordered.  The Purchase Order contains the only terms which govern the purchase of goods and services by BAUER from Seller and shall prevail in the event of conflict with any terms and conditions Seller attempts to impose, including, but not limited to, those in Seller’s acceptance of this Purchase Order, confirmation or invoice.  This Purchase Order contains the entire agreement between BAUER and the Seller, and supersedes all prior or contemporaneous understandings, agreements, negotiations, representations and warranties, and communications, both written and oral.  This Purchase Order prevails over any of Seller’s general terms and conditions of sale regardless whether and when Seller has submitted its sales confirmation of such terms.



All specifications, drawings, and data submitted to Seller with, or in connection with, this Purchase Order are hereby incorporated by reference.  No agreement or understanding to modify this Purchase Order or its terms and conditions shall be binding upon BAUER unless it is in writing and signed by BAUER’s authorized agent.



Delivery shall be made [shipping terms BAUER’s destination / in accordance with the terms on the face of this Purchase Order].  Title and risk of loss passes to BAUER upon delivery of the goods at BAUER’s destination.  All goods shall be suitably packed, marked, and shipped in accordance with the requirements of common carriers in a manner to secure lowest transportation cost and in a manner to ensure that the goods are delivered in undamaged condition, and no additional charge shall be made therefore unless otherwise stated herein.  Seller shall properly mark each package with BAUER’s order number.  Order number and package numbers must be shown on packing slips, bills of lading, and invoices.  Typed packing slips must accompany each shipment and packing slip description shall be in accordance with Purchase Order description.  Any additional charges accruing from deviation from BAUER’s routing instruction will be charged to Seller’s account.  Seller must provide BAUER prior written notice it if requires BAUER to return any packaging material. Any return of such packaging material shall be made at Seller’s risk of loss and expense.



Seller acknowledges that time is of the essence with respect to Seller’s obligations hereunder and the timely delivery of goods and services.  BAUER’s production schedules are based upon the delivery of the goods to BAUER, or the performance of the services, on the date or dates specified on the face of this Purchase Order.  If deliveries are not made at the time agreed upon, or if Seller fails to perform the services in accordance with this Purchase Order, BAUER may terminate this Purchase Order immediately by providing written notice to Seller and Seller shall indemnify BAUER against any losses, claims, damages, and costs and expenses directly attributable to Seller’s failure to deliver the goods on the specified delivery date or failure to perform the services if Seller does not correct such failure within 10 days after receipt of written notice from BAUER specifying such failure.  BAUER reserves the right to reject and return at Seller’s risk of loss and expense early deliveries or to defer payment for early deliveries until the delivery date specified in this Purchase Order.



If Seller delivers [more than ___% or less than ___%] of the quantity of goods ordered, BAUER may reject all or any excess goods or short shipments.  Any such rejected goods shall be returned to Seller at Seller’s sole risk of loss and expense.  If BAUER does not reject the goods and instead accepts delivery of goods at the increased or reduced quantity, the price for the goods will be adjusted on a pro-rata basis. 



Goods purchased hereunder are subject to inspection and acceptance at BAUER’s destination, notwithstanding any previous inspection.  BAUER reserves the right to inspect all or a sample of the goods, and to reject in whole or in part, or require prompt cure of, goods that do not conform with the instructions, specifications, drawings, data, other terms of this Purchase Order, applicable warranties or samples furnished.  If BAUER rejects any portion of the goods, BAUER has the right, effective upon written notice to Seller, to (a) rescind this Purchase Order in its entirety, (b) accept the goods at a reasonably reduced price, or (c) reject the goods and require replacement of the rejected goods.  If BAUER elects to rescind this Purchase Order, rejected goods will be returned to Seller at Seller’s risk of loss and expense, and Seller agrees to refund any payment which it may have received from BAUER, including original shipment expense.  If BAUER requires replacement of the goods, Seller shall comply with the provisions set forth in paragraph 7 below.  Any inspection or other action by BAUER under this paragraph shall not reduce or otherwise affect Seller’s obligations under this Purchase Order, and BAUER shall have the right to conduct further inspections after Seller has carried out its remedial actions.  Partial or full payment for any materials ordered shall not be deemed in acceptance thereof.



Seller warrants all goods will (a) be free from defects in material, workmanship and design, (b) confirm strictly to the specifications, drawings, designs, samples and other requirements, (c) be fit for their intended purpose or operate as intended, (d) be merchantable, (e) be free and clear of all liens, security interests or other encumbrances, and (f) not infringe or misappropriate any third party’s patent or other intellectual property rights.  This warranty shall survive any inspection, delivery, acceptance, or payment by BAUER for the goods.  Seller further warrants to BAUER that it shall perform the services using personnel of required skill, experience and qualifications and in a professional and workmanlike manner in accordance with generally recognized industry standards for similar services and shall devote adequate resources to meet its obligations under this Purchase Order.  The warranties set forth in this paragraph are cumulative and in addition to any other warranties provided by law or equity.  Any applicable statute of limitation runs from the date of BAUER’s discovery of the noncompliance of the goods or services with the foregoing warranties.  If BAUER gives Seller notice of noncompliance pursuant to this paragraph or BAUER requires the replacement of goods pursuant to paragraph 6, Seller shall, at its own cost and expense, [promptly within ___ days], (i) replace or repair the defective or nonconforming goods and pay for all related expenses, including, but not limited to, transportation charges for the return of the defective or nonconforming goods to Seller and the delivery of the repaired or replacement goods to BAUER, and, if applicable, (ii) re-perform the applicable services.  If Seller fails to timely repair or deliver replacement goods, BAUER may replace them with goods from a third party and charge Seller the cost thereof and terminate this Purchase Order.



Seller shall, at its expense, defend, indemnify and hold harmless BAUER and BAUER’s parent company, their subsidiaries, affiliates, successors or assigns and their respective directors, officers, shareholders, employees and agents, and BAUER’s distributors, dealers, sales representatives, agents, and customers (collectively, “BAUER Indemnitees”) from and against any and all loss, injury, death, damage, liability, claim, deficiency, action, judgment, interest, award, penalty, fine, cost or expense, including attorney’s, expert’s and professional’s fees and costs, and the cost of enforcing any right to indemnification hereunder and the cost of pursuing any insurance providers (collectively, “Losses”) arising out of or in connection with any claim that BAUER’s or BAUER’s Indemnitees use or possession of the goods or use of the services infringes or misappropriates the patent, copyright, trade secret or other intellectual property right of any third party, unless, in the case of goods, such goods are requested by BAUER to be specifically constructed in exact accordance with BAUER’s designs or technical specifications which constitute the basis for such Loss.  In no event shall Seller enter into any settlement without BAUER’s or BAUER’s Indemnitees prior written consent.



BAUER shall not be billed at prices higher than stated on this Purchase Order unless authorized by a written “Revision of Purchase Order” issued and signed by an authorized representative of BAUER.  Seller represents that the price charged for the items or services covered by this Purchase Order is the lowest price charged by the Seller to buyers of a class similar to BAUER under conditions similar to those specified in this Purchase Order and that prices comply with any applicable government laws and regulations in effect at the time of quotation, sale, and delivery.  Seller agrees that any price reduction made in goods or services covered by this Purchase Order subsequent to placement of this Purchase Order, but prior to shipment or rendering thereof, will be applicable to this Purchase Order.  No payment will be made by BAUER for transportation, freight, insurance, boxing, crating, cartage, customs duties, or other added charge unless provided on this Purchase Order or on a revision thereto.  Except as may be otherwise provided in this Purchase Order, the price includes all applicable federal, state, and local taxes in effect on the date of this Purchase Order.  No increase in price is effective, whether due to increased material, labor or transportation costs or otherwise, without the prior written consent of BAUER.



Terms of payment are set forth on the face of this Purchase Order under “Terms”.  Any discount or payment period shall be calculated from the date BAUER receives a correct invoice.  Seller shall forward to BAUER with the invoice either the express receipt or the bill of lading, signed by the carrier which shows that shipment has been made.  In the event of any good faith payment dispute by BAUER, BAUER may withhold the amounts being disputed without being in breach of this Purchase Order.



Seller agrees to indemnify, defend, and hold harmless BAUER and BAUER Indemnitees from and against all Losses arising out of or in connection with the goods or services purchased from Seller or Seller’s negligence, willful misconduct or breach of this Purchase Order.  Seller shall not enter into any settlement without BAUER’s prior written consent.  Seller shall, at its own expense, obtain, maintain and carry insurance in full force and effect which includes, but is not limited to the following insurance, with not less than the stated limits and with financially sound and reputable insurers:

(a) Workman’s Compensation and Occupational Disease Insurance and U.S. Longshoremen’s & Harbor Workers’ Compensation Insurance (where required) – Statutory Limit.

(b) Employers’ Liability Insurance - $100,000 per person.

(c) Comprehensive General Liability Insurance Including Products – Completed Operations and Broad Form Contractual Liability: Bodily Injury - $500,000 per person and $1,000,000 per occurrence.  Property Damage - $1,000,000 per occurrence; and

(d) Automobile Liability Insurance: Bodily Injury - $250,000 per person and $500,000 per occurrence, and Property Damage - $250,000 per occurrence, and Property Damage - $250,000 per occurrence.

Upon BAUER’s request, Seller shall provide BAUER with a certificate of insurance from Seller’s insurer evidencing the insurance coverage specified in this Purchase Order.  [The certificate of insurance shall name BAUER as an additional insured.  Seller shall provide BAUER with 30 days’ advance written notice in event of a cancellation or material change in Seller’s insurance policy.  Except where prohibited by law, Seller shall require its insurer to waive all rights of subrogation against Seller’s insurers and Seller.]



In accepting this Purchase Order, Seller represents that, at its own expense, it has complied with, and will continue to comply with all obligations imposed by any one or more federal, state, local and/or international laws that may be applicable to the goods and/or services covered by this Purchase Order, including, but not limited to, all statutes, regulations and ordinances, as well as any required permits, licenses or taxes.  Seller further warrants that all goods delivered and/or services performed under this Purchase Order conforms to all relevant federal, state and/or international occupational safety and health laws and standards, and was produced or provided in accordance with applicable federal, state, local and/or international worker safety, wage and non-discrimination or harassment laws and regulations.  In the performance of this Purchase Order, Seller has and will comply with all applicable United States Department of Transportation regulations on hazardous materials.  Seller shall maintain in effect all licenses, permits, permissions, authorizations and consents that it needs to carry out its obligations under this Purchase Order.  Seller shall comply with all export and import laws of the countries involved in the sale of goods under this Purchase Order or any resale of the goods by Seller.  Seller assumes all responsibility for shipments of goods requiring any government import clearance.




Goods or services specified in this Purchase Order may be used by BAUER in fulfilling U.S. Government, state, or local prime or subcontracts and may, therefore, be subject to the applicable federal, state or local procurement laws and regulations.  Seller shall abide by all such applicable laws and regulations, including, without limitation, the requirements of 41 CFR §§ 60-1.4(a), 60-300.5(a) and 60-741.5(a). These regulations prohibit discrimination against qualified individuals based on their status as protected veterans or individuals with disabilities, and prohibit discrimination against all individuals based on their race, color, religion, sex, sexual orientation, gender identity or national origin. Moreover, these regulations require that Seller take affirmative action to employ and advance in employment individuals without regard to race, color, religion, sex, sexual orientation, gender identity, national origin, protected veteran status or disability.  When the purchase to which this Purchase Order relates is for fulfillment of a specific U.S. Government prime or subcontract, additional information, terms and conditions are included in an attached supplement to this Purchase Order.  For general reference, Seller should consult and, where applicable, comply with the Federal Acquisition Regulations, 48 CFR Chapter 1, Parts 1-51 and Defense Federal Acquisition Supplement (DFARS), 48 CFR Chapter 2, Parts 201-252.  [Note:  if Bauer is including additional terms required by a government contract, you may retain the highlighted language.  If, however, Bauer is not attaching the additional terms, we recommend removing the highlighted language.]



Seller shall not assign this Purchase Order or delegate or assign any duties hereunder, nor assign any rights or claims under this Purchase Order, or for breach thereof, without prior written consent of BAUER, and any such attempted delegation or assignment shall be void.  No assignment or delegation shall relieve Seller of any of its obligations hereunder, and Seller shall remain fully responsible for the performance of each permitted approved assignee and its employees and for their compliance with all of the terms and conditions of this Purchase Order.  Nothing in this Purchase Order shall create any contractual relationship between BAUER and any Seller subcontractor or supplier.  All claim for moneys due or to become due from BAUER shall be subject to deduction by BAUER for any setoff or counterclaim arising out of this or any other of BAUER’s Purchase Orders with the Seller, whether such setoff or counterclaim arose before or after any such assignment by Seller.



Notwithstanding the provisions of paragraph 2 above, BAUER shall have the right to make, upon notice to Seller, changes as to packing, testing, destinations, specifications, designs, and delivery schedules.  Seller shall immediately notify BAUER in writing of any increases or decreases in costs caused by such changes and an equitable adjustment in prices or other terms hereof shall be agreed upon in a written amendment to this Purchase Order.



No waiver by BAUER of any of the provisions of this Purchase Order is effective unless explicitly set forth in writing and signed by an authorized representative of BAUER.  No failure to exercise, or delay in exercising, any right, remedy, power or privilege arising from this Purchase Order operates, or may be construed, as a waiver thereof.  No single or partial exercise of any right, remedy, power or privilege hereunder precludes any other or further exercise thereof or the exercise of any other right, remedy, power or privilege.  No waiver expressly granted by BAUER in writing of any provision in a given circumstance applies to any future circumstance.



Any determination that any provision hereof is illegal or void shall not affect the remaining provisions hereof, which shall continue in full force and effect.



All non-public, confidential or proprietary information of BAUER, including but not limited to, specifications, samples, patterns, designs, plans, drawings, documents, data, business operations, financial information, customer lists, pricing, discounts or rebates, disclosed by BAUER to Seller, whether disclosed orally or disclosed or accessed 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 is confidential, solely for the purpose of performing this Purchase Order and may not be disclosed, copied or disseminated. Upon BAUER’s request, Seller shall promptly return all documents and other materials received from BAUER. BAUER shall be entitled to injunctive relief for any violation of this paragraph.



Neither party shall be liable to the other for any delay or failure in performing its obligations under this Purchase Order to the extent that such delay or failure is caused by an event or circumstance that is beyond the reasonable 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").  Force Majeure Events include, but are not limited to, acts of God or the public enemy, government restrictions, floods, fire, earthquakes, explosion, epidemic, war, invasion, hostilities, terrorist acts, riots, strike, embargoes or industrial disturbances.  Seller's economic hardship, changes in market conditions or interruptions in transportation are not considered Force Majeure Events. Seller shall use all diligent efforts to end the failure or delay of its performance, ensure that the effects of any Force Majeure Event are minimized and resume performance under this Purchase Order. If a Force Majeure Event prevents Seller from carrying out its obligations under this Purchase Order for a continuous period of more than [___] business days, BAUER may terminate this Purchase Order immediately by giving written notice to Seller and without further liability to Seller.



This Purchase Order and any contract resulting therefrom shall be governed by the internal laws of Virginia, without regard to its choice of law principles.  It is further expressly understood and agreed that this Purchase Order shall be deemed to have been executed in the City of Norfolk, and to have been performed in the City of Norfolk, Virginia.  The parties agree to attempt to settle all disputes, controversies or claims, whether based on contract, tort, statute, fraud, misrepresentation or any other legal theory, through good faith negotiations. If such negotiations fail to resolve the dispute within fifteen (15) days of the date of the initial demand for negotiations, then the parties shall refer the dispute (except those set forth below) to final, binding arbitration in Norfolk, Virginia, under the then current Commercial Arbitration Rules of the American Arbitration Association. This provision shall apply to all claims, regardless of when those claims arose or accrued. BAUER reserves the right to bring in court any claims for equitable relief, including specifically for injunctive relief, foregoing the negotiation and arbitration otherwise called for in this paragraph. For matters not subject to arbitration, as set forth above, any action at law, suit in equity or judicial proceeding relating to this Agreement or any provision hereof (including any suit to compel arbitration) shall be instituted only in the applicable Virginia state court situated in Norfolk, Virginia or in the United States District Court for the Eastern District of Virginia, Norfolk Division.  BAUER and Seller hereby consent to the exclusive jurisdiction of such courts, and acknowledge that such courts have personal jurisdiction over them and agree that venue is proper in those courts.  BAUER and Seller hereby waive the right to a jury trial in any such suit or action.



In the event BAUER employs an attorney because of a violation of any term or provision of this Purchase Order by Seller, Seller shall pay and be liable for attorney’s fees, expert fees, professional fees and court costs incurred by BAUER, including an allowance for fees required in post-judgment collection efforts.



This Purchase Order is for the sole benefit of the parties hereto and their respective successors and permitted assigns and nothing herein, express or implied, is intended to or shall confer upon any other person or entity any legal or equitable right, benefit or remedy of any nature whatsoever under or by reason of this Purchase Order.



In addition to any remedies that may be provided under this Purchase Order, BAUER may terminate this Purchase Order with immediate effect upon written notice to the Seller, either before or after the acceptance of the goods or the Seller's delivery of the services, if Seller has not performed or complied with any terms of conditions of this Purchase Order, in whole or in part. If the Seller becomes insolvent, files a petition for bankruptcy or commences or has commenced against it proceedings relating to bankruptcy, receivership, reorganization or assignment for the benefit of creditors, then BAUER may terminate this Purchase Order upon written notice to Seller and without any liability to BAUER whatsoever.  If BAUER terminates this Purchase Order for any reason, Seller's sole and exclusive remedy is payment for the goods received and accepted and services accepted by BAUER prior to the termination.



All notices, requests, consents, claims, demands, waivers and other communications hereunder (each, a "Notice") shall be in writing and addressed to the parties at the addresses set forth on the face of this Purchase Order or to such other address that may be designated by the receiving party in writing. All Notices shall be delivered by personal delivery, nationally recognized overnight courier (with all fees pre-paid), facsimile (with confirmation of transmission) or certified or registered mail (in each case, return receipt requested, postage prepaid). Except as otherwise provided in this Agreement, a Notice is effective only (a) upon receipt by the receiving party, and (b) if the party giving the Notice has complied with the requirements of this paragraph.