Terms and Conditions governing Purchase Orders

Revision date June 1, 2022

  1. AGREEMENT AND ACCEPTANCE: The entire agreement (the “Agreement”) between Ken-tron Mfg., Inc. (“Ken-tron”), and the vendor, contractor or service provider to whom Ken-tron has addressed the purchase order (“Seller”) consists of (a) the Purchase order terms on the front of the Purchase Order Document (the “Order”), (b) these Purchase Order Terms and Conditions, and (c) any plans or specifications provided by Ken-tron to Seller (“Plans”). The Agreement shall become binding when accepted by Seller either by acknowledgement or performance. Any terms and conditions proposed by the Seller which are additional to or inconsistent with the terms and conditions contained in the Agreement shall be void, unless specifically agreed to by Ken-tron in writing, signed by Ken-tron’s duly authorized representative.
    1. QUALITY SYSTEM: Seller shall maintain a quality system acceptable to Ken-tron, subject to review, verification and analysis by Ken-tron and/or Ken-tron’s customer (upon Ken-tron’s notification) during performance of this purchase order. Unless otherwise specified, Seller must inform Ken-tron on request whether the Seller’s quality system and that of Seller’s sub tiers complies with ISO 9000. Ken-tron retains the right to disapprove Seller’s Quality System as well as the Quality System of sub tier suppliers. All communications with, and records required by, Ken-tron, including documentation such as planning, audits, records, reports, etc. Shall be in the English language.
    2. SPECIFICATIONS AND REVISIONS: Furnish any product in accordance with the specification and current revision per Purchase Order.  If no revision is stated on Purchase Order, furnish latest revision.
    3. DOCUMENTATION and RECORDS: Seller shall maintain an in-house system that ensures complete documentation and accurate identification of product and product status, including documentation by sub tiers, and throughout the procurement, manufacturing, inspection and delivery process.
    4. INTERNAL AUDITS: Seller shall perform periodic internal audits which shall be available to Ken-tron on request.
    5. INSPECTION: The Order may be subject to (1) inspection or testing during the period of manufacture, (2) inspection prior to shipment, and/or (3) final inspection and acceptance at destination. Payment for goods delivered under the Order shall not constitute an acceptance thereof. All goods shall be received subject to Ken-tron’s inspection, and goods, which do not comply with the warranties in Section 9, may be returned to Seller or may be held pending Seller’s instructions, at Seller’s risk. Ken-tron may require Seller to repair or replace rejected supplies, or to refund the price of any such supply. The failure of Ken-tron in any one or more instances to insist on performance of any of the provisions of the Order shall in no way be construed to be a waiver of such provisions in the future.
    6. NOTIFICATION: The Seller shall immediately notify Ken-tron of non-conforming product that may have been shipped.
    7. GOVERNMENT SOURCE INSPECTION: If Government source inspection prior to shipment is required, Seller will arrange with its cognizant Government representative for such inspection.
    8. ACCESS TO RECORDS: Seller’s related inventory and inspection records shall be made available to the buyer on request. Modified inspection records must include reason for modification, name and date of individual who made the changes.
    9. PERSONNEL: Work must be supervised and performed by qualified personnel.
    10. PROCUREMENT CONTROL: Seller shall review their sub tier suppliers to ensure that (1) all quality requirements of Ken-tron’s Order are flowed down and met, (2) only Ken-tron designated special process sources are used when required by contract and (3) quality assurance documentation including test data and manufacturer’s material certification is made available to Ken-tron. The use of Ken-tron designated sources does not relieve the Seller of the commitment of meet all product requirements.
    11. ACCESS: The Seller agrees that Ken-tron, Ken-tron’s customers and/or regulatory authorities are allowed access to Seller’s facility for the purpose of reviewing, verifying and analyzing Seller’s manufacturing, quality and/or inspection system.
    12. RECORDS RETENTION: The Seller agrees to retain all records pertaining to Ken-tron purchases for a minimum of 10 years unless otherwise notified by Ken-Tron.
    13. DISCREPANCIES: In the event discrepancies exist between these quality requirements and detail specifications or drawings, the detail specifications or drawings govern. If the Seller notes discrepancies, notify Ken-tron at once.
    14. COUNTERFEIT: Seller agrees and shall ensure that counterfeit goods are not delivered to Ken-tron. Seller shall immediately notify Ken-tron if Seller becomes aware or suspects that it has furnished counterfeit goods. All occurrences of suspect counterfeit and/or counterfeit goods will be reported to the proper authorities. Seller shall be liable for all costs, including but not limited to Ken-tron’s internal and external costs relating to the removal and replacement of said goods and subsequent testing of said goods.  Ken-tron reserves all contractual rights and remedies to address grievances and detrimental impacts caused by suspect/counterfeit goods. Counterfeit components have zero value. 
  3. DELIVERY SCHEDULE; QUANTITIES: Unless otherwise agreed in writing, Seller shall not make material commitments or production arrangements in excess of the amount or in advance of the time necessary to meet Ken-tron’s delivery schedule. Seller’s responsibility shall be to obtain Ken-tron’s approval to ship nonconforming product. Seller’s responsibility shall be to comply with such schedule, but not to anticipate Ken-tron’s requirements. Any variation in the quantities specified in the Order shall not be accepted as compliance with the Order, except by prior written agreement of the parties. Goods shipped to Ken-tron prior to the delivery schedule in the Order, or in excess of the quantity ordered, may be returned to Seller at Seller’s expense.
  4. DELIVERY; DELAYS IN DELIVERY: Unless otherwise agreed in writing, TIME IS OF THE ESSENCE, and all deliveries shall be made strictly in accordance with the delivery schedule set out in the Order. Any extension of time for delivery agreed to by Ken-tron shall relate only to the extension in question and shall not be deemed a waiver of Ken-tron’s rights to delivery on any agreed upon revised delivery date. Seller shall not, however, be liable for delay due to causes beyond Seller’s reasonable control and without its fault or negligence, provided, Seller exercises reasonable diligence in notifying Ken-tron of the conditions which are causing the delay. If, for any reason, Seller fails to substantially comply with Ken-tron’s delivery schedule, Ken-tron, at its option may either approve a revised delivery schedule or may terminate the Order in accordance with Section 17. Seller to notify Ken-tron of any delays in shipping time.
  5. TRANSPORTATION: Unless specified in the Order or otherwise agreed in writing, all transportation and related insurance charges for goods purchased pursuant to the Order shall be paid by Seller. If purchase terms are specified as F.O.B. shipping point and Seller prepay transportation and insurance charges, then Seller’s prepaid transportation charges must be supported by a copy of the carrier’s bill or other evidence satisfactory to Ken-tron. Failure to submit such proof at the time Ken-tron is billed for the goods or within thirty (30) days after such evidence is requested by Ken-tron shall constitute a waiver by the Seller of such charges. The risk of loss on goods pursuant to the Order supplied shall be the Seller’s until delivery to the destination specified by Ken-tron (or, if F.O.B. shipping point, until delivered to a carrier approved by Ken-tron).
  6. LOWEST PREVAILING PRICE: Seller agrees that its price for goods ordered hereby shall not be higher than its lowest prevailing price on the date hereof for the quantity ordered. Ken-tron shall receive the benefit of any price reduction in effect prior to shipment.
  7. EXTRA CHARGES: No charges of any kind including, without limitation, charges for boxing and cartage, shall be allowed unless specifically agreed to by Ken-tron in writing. Unless otherwise agreed, the Order price shall cover net weight of materials. Any variation from the price first quoted for the Order must be submitted in writing to Ken-tron as and when such variations occur.
  8. PACKAGING AND SHIPPING: All goods shall be prepared for shipment and packed to prevent damage or deterioration, secure lowest transportation rates, and comply with carrier tariffs. No charges shall be paid by Ken-tron for preparation, packing and crating, unless separately stated in the Order. Shipments not accompanied with a proper packing list shall be subject to the count and weight of Ken-tron, whose sole determination shall be conclusive. Seller shall not ship goods COD, unless previous arrangements have been made.
  9. WARRANTIES: Seller warrants that all goods shall (a) be merchantable and fit for the intended purposes, (b) conform with any Plans and with applicable drawings, samples and/or other descriptions given to Seller by Ken-tron, (c) be free from defects in materials and workmanship and (d) to the extent not manufactured pursuant to detailed designs furnished by Ken-tron, free from defects in design. Without limitation of any rights which Ken-tron may have at law by reason of any breach of warranty, goods which are not as warranted may be returned at Seller’s expense for either credit or replacement, as Ken-tron may direct. This warranty does not constitute a waiver of any other rights of Ken-tron, expressed or implied. This warranty shall run to Ken-tron, its successors and assigns, its customers and the users of its products, and it shall survive acceptance, inspection and payment. Seller shall indemnify Ken-tron and hold Ken-tron harmless from and against any and all liability, loss, damages, costs, claims and expenses that may be made against Ken-tron or that Ken-tron may incur, either directly or indirectly, by reason of or arising from the goods or services furnished hereunder.
  10. CHANGES: Ken-tron reserves the right to make changes in the Order including, without limitation, changes in drawings, specifications and delivery (“Change Orders”). Seller agrees to comply with such Change Orders. If such Change Orders result in a decrease or increase in Seller’s cost or in the time for performance, an equitable adjustment in the price or time for performance shall be made in writing by Ken-tron and Seller. Any claim for additional compensation hereunder must be asserted within thirty (30) days after such Change Order. Failure of Seller to assert its claim shall operate as a waiver.
  11. SELLER CHANGES: Seller shall not make changes in design of any product on the Order without first notifying Ken-tron and obtaining approval in writing. Definition of changes shall include but are not limited to: material, processing, interface parameters, facilities, suppliers, external configuration and refinish.
  12. MATERIAL, EQUIPMENT AND INSURANCE: Unless otherwise specified, Seller is to supply all material and equipment required to execute the Order. Unless otherwise agreed in writing, all specifications, drawings, technical information, data and/or patterns, tools, equipment, or material of every description furnished to Seller by Ken-tron, or specifically paid for, either partially of totally, by Ken-tron, and any replacement thereof, or any materials affixed or attached thereto, shall be and remain the personal property of Ken-tron. Such property, while in Seller’s custody or control, shall be (a) held at Seller’s risk, (b) insured by Seller at Seller’s expense, in an amount equal to such property’s replacement cost, with loss payable to Ken-Tron, and (c) subject to removal upon Ken-tron’s written request.
  13. FEDERAL, STATE AND LOCAL TAXES: Unless otherwise indicated, the Order prices shall include any and all Federal, State and Local Taxes applicable to the manufacture, sale or distribution of the completed goods and any subsidiary items incorporated therein.
  14. PATENTS, TRADEMARKS, ETC.: Seller warrants that neither the goods furnished under the Order nor the sale nor use thereof will infringe on any existing patent, trademark or copyright. Seller shall defend, indemnify and hold harmless Ken-tron, its directors, officers, agents and customers (collectively Ken-tron) from and against any suit, claim or demand alleging patent, trademark or copyright infringement or misappropriation of any trade secret arising out of or in connection with the Order. Ken-tron may assume it own defense, or join in the defense of any action in which it is made a party, in which event the forgoing indemnity and agreement to hold Ken-tron harmless shall extend to all of Ken-tron’s costs therein including attorneys’ fees and litigation costs. All royalties for patents or charges for the use of patents which may be infolved in the performance of the Order shall be included in the cost of performance and shall be paid by Seller.
  15. ASSIGNMENT: Seller shall not assign the Order, this Agreement nor any moneys due or to become due hereunder, without the prior written consent of Ken-tron. Any assignment or attempted assignment made without such consent of Ken-tron shall be void as to Ken-tron.
  16. TERMINATION FOR CONVENIENCE: Ken-tron may, at any time and upon written notice, terminate the Order in whole or in part regardless of whether Seller is in default under this Agreement. Such written notice shall state the extent and the effective date of termination. Upon receipt of such notice, Seller shall take the necessary steps to mitigate any losses Seller might incur on account of such termination. Upon such termination, Ken-tron’s obligation to Seller shall be limited solely to payment for (a) goods already shipped to Ken-tron, (b) completed goods produced pursuant to specifications unique to Ken-tron and not yet shipped to Ken-tron, (c) the actual costs incurred by Seller that are properly allocable under recognized commercial accounting practices to the terminated portion of the Order, including Seller’s obligations to subcontractors that are also allocable, but excluding any charge of any nature that may be diverted to other orders, and (d) a reasonable profit on the work performed by Seller before receipt of the termination notice. The total payments Ken-tron is obligated to make under this section shall not exceed the price of goods to which termination applies. Seller shall comply with Ken-tron’s instructions concerning goods Seller already has furnished or partly furnished for Ken-tron. Ken-tron shall not be responsible to pay for finished goods in production or goods fabricated or procured by Seller for producing such goods when such goods were fabricated or procured by Seller unnecessarily in advance or in excess of Ken-tron’s delivery schedule. Termination by Ken-tron under this section shall be without prejudice to any claims Ken-tron may have against the Seller. The payment provided under this provision shall constitute Ken-tron’s only liability in the event the Order is terminated as provided in this Section. The foregoing shall not apply to any termination by Ken-tron on account of Seller’s default under any of the provision in Section 17. To the extend the Order covers items normally carried in inventory by Seller, as distinguished from goods specially made to Ken-tron’s specifications, Ken-tron shall have no liability for any termination hereof prior to actual shipment.
  17. TERMINATION FOR DEFAULT: Each of the following events shall constitute a default by Seller for purposes of this Agreement (a) the insolvency of Seller, (b) any assignment for the benefit of creditors of Seller, (c) the voluntary or involuntary filing of a petition order or other decree in bankruptcy by or against Seller, (d) the commencement of any proceeding, under court supervision or otherwise, for liquidation of, reorganization of, or the composition, extension, arrangement or readjustment of the obligations of Seller, (e) failure by Seller to comply with Ken-tron’s reasonable instructions and Change Orders, (f) failure by Seller to comply with any of the provisions of the Order, (g) failure of the goods to conform to Seller’s warranties contained herein or other warranties made by Seller, (h) failure of Seller to make deliveries as scheduled and (i) proof that any representation by Seller were false when made. In the event of any such termination Ken-tron, in addition to other rights it may have under applicable law or other terms of this Agreement, shall have the right (a) to refuse to accept further delivery of goods, (b) to return to Seller, at Seller’s expense, any goods already delivered and to recover all payments made thereof and for expenses incident thereto, (c) to recover any advance payments to Seller for undelivered, unperformed or returned goods and (d) to purchase elsewhere and charge Seller with any additional costs resulting therefrom. Ken-tron’s right to return goods is not affected by any assignment by Seller or moneys due or to become due hereunder.
  18. WAIVER: No delay or omission in exercising any right or remedy shall operate as a waiver thereof or of any right or remedy, and no single or partial exercise thereof shall preclude any other or further exercise thereof or the exercise of any other right or remedy. The rights, powers, elections and remedies of the parties hereunder are cumulative and in addition to those which the parties have at law or in equity. Ken-tron’s failure to object to any provision contained in any communication from Seller shall not be deemed an acceptance of such provision or a waiver of any provision of this Agreement.
  19. COMPLIANCE WITH LAWS: Seller shall, in the performance of the Order, comply with all applicable laws, statutes, rules, regulation and orders of governmental, public and quasi-public authorities. Seller shall defend, indemnify and hold harmless Ken-tron from and against any liability, expense or cost (including attorneys’ fees) resulting from Seller’s failure to comply. During the performance of the Order, Seller agrees to comply with all Federal, state and local laws respecting discrimination in employment and non-segregation of facilities including, but not limited to, requirements set out at 41 CFR 60-1.4, 60-250.5 and 60-741.5, which equal opportunity clauses are hereby incorporated by reference. Notification is hereby given that compliance with these clauses may require the Seller to annually file certain reports (e.g. the EEO-1 Report and VETS-100 Report) with the Federal government and may require the vendor to develop written Affirmative Action Programs for Women and Minorities, covered Veterans and/or Persons with Disabilities. Seller also represent to Ken-tron that the goods and/or services supplied hereunder were or will be produced in compliance with the requirements of the Fair Labor Standards Act of 1938, as amended, and Seller shall insert a certificate to that effect on all invoices submitted in connection with the Order.
  20. EQUAL OPPORTUNITY: When applicable, this contractor and subcontractor shall comply with the EO Clause in Section 202 of Executive Order 11246, as amended, and the applicable regulations contained in 41 C.F.R. Parts 60-1 through 60-60 and Executive Order 13496 which are incorporated herein by specific reference. 
    1. When applicable, this contractor and subcontractor shall abide by the requirements of 41 C.F.R. § 60-300.5(a). This regulation prohibits discrimination against qualified protected veterans, and requires affirmative action by covered prime contractors and subcontractors to employ and advance in employment qualified protected veterans. 
    2. When applicable, this contractor and subcontractor shall abide by the requirements of 41 C.F.R. § 60-741.5(a). This regulation prohibits discrimination against qualified individuals on the basis of disability, and requires affirmative action by covered prime contractors and subcontractors to employ and advance in employment qualified individuals with disabilities.
  21. INFORMATION DISCLOSED, ETC.: Seller shall not, without Ken-tron’s prior written consent, disclose any information relative to the Order, except as may be necessary to insure performance. Seller, however, agrees that any knowledge or information which Seller shall have disclosed or may hereafter disclose to Ken-tron, in connection with the purchase of the goods or services covered by the Order, shall not, unless otherwise specifically agreed upon in writing by Ken-tron, be deemed to be confidential or proprietary information, and shall be acquired free from any restrictions (other than a claim for patent infringement) as part of the consideration for the Order.
  22. FORCE MAJEURE: Ken-tron shall not be liable for, or in connection with, any failure or delay in performance due wholly or partly to any strike, lock out or industrial disturbance at or affecting Ken-tron’s premises, or to contingency whatsoever beyond its control (e.g., flood, fire, etc.) which prevents or hinders Ken-tron from taking delivery of the goods or from using the goods for the purpose intended.
  23. LEGAL EXPENSES: If any legal action is instituted by or against Ken-tron with respect to the Order, this Agreement or the underlying transaction, and should Ken-tron prevail in such legal action, Seller will indemnify Ken-tron for any and all legal expenses, including attorney’s fees, incurred in said legal action.
  24. GOVERNING LAW; ARBITRATION: This Agreement shall be governed by, interpreted and construed in accordance with the internal laws of the State of Kentucky, without regard to the principles of conflicts of law. All disputes arising from or related to this Agreement shall be submitted to arbitration in Owensboro, Kentucky (or at a location agreed to by Ken-tron) under the rules then prevailing of the American Arbitration Association and judgment may be entered on any award in a court of competent jurisdiction.