The following terms and conditions together with the terms and conditions set forth in the purchase order (the “PO”), and, if applicable, in the documents attached to the PO (the “Special Terms” and collectively, the “Terms”) shall apply to all purchases of the products and/or services (“Products”) made by LK., from the supplier designated on the PO (“Supplier”). Each of LK and Supplier shall be referred to herein as a “Party”, and collectively, the “Parties”.
These Terms shall enter into force upon acceptance of the PO by Supplier in accordance with Section 35 of these Terms, and shall solely govern the purchase of the Products by LK from the Supplier. By accepting the PO, Supplier acknowledges and agrees that these Terms constitute the complete contract between LK and Supplier with respect to the transactions contemplated by the PO, and that they supersede all prior or contemporaneous representations, communications, agreements and understandings, oral or written, with respect to the subject matter thereof, unless agreed otherwise by LK and Supplier in writing. No modification or addition to these Terms or to any other provision of the contract for the sale of Products shall be binding on either party unless mutually agreed in advance.
3. In the event of any conflict between the Special Terms (as approved by LK) and any other terms and conditions set forth in these Terms, the Special Terms shall prevail.
4. The Products will be supplied to LK and will be of the type, quality, drawing revision size, class of material, description, finishing, condition and packaging
any other specifications or instructions included in, or attached to, the PO (the “Specifications”). Where applicable, the Products shall be identical to the samples or examples exchanged and agreed upon by the Parties. The Products will be of the best quality and materials and produced to the highest professional standards.
5. With respect to any part or component of the Products, where a standard has been set by the Israel Standards Institute or any other applicable local or international standard organization worldwide (a “Standard”), such component or part shall conform to the stipulations of the Standard, and shall be approved by an authorized laboratory in the applicable country of origin. LK reserves the right to conduct laboratory tests to verify conformity with the requirements of the standard.
Packaging, Supply and Delivery of the Products
6. Supplier shall comply with the quantities and delivery dates specified in the PO. Supplier may be allowed to bring forward or postpone the supply date, subject to the explicit, advanced, written agreement of LK. In the event of delay in supply, for whatever reason, LK shall have the right to refuse to accept the Products or any part thereof, without prejudice to any other right it may have under law. Where the supply date is brought forward without the aforementioned advanced agreement of LK, LK shall be entitled to return such Products at the expense of Supplier.
7. Unless the PO or the Special Terms provide otherwise, delivery of the Products shall be DDP LK’s designated location (as such term is defined in Incoterm 2010).
8. Packaging materials, the packaging of the Products, as well as the expenses incurred by the Supplier in the transport, unloading and delivery of the Products, or any other act undertaken up to the completion of this PO, shall be included in the price of the Products, unless otherwise stipulated in the Special Terms.
9. All materials (including any raw or processed materials), all equipment, tools, plans, moulds and settings, which LK from time to time provides Supplier and/or incurs the expense of their procurement for the purposes of pursuing the PO; all specifications, models, drawing or other technical know-how or directly or indirectly based on, related to, or resulting from the transactions contemplated by the PO or any LK Confidential Information (as defined below); and all Intellectual Property Rights in or related to the Products, as well as any modification, adaptation or derivation thereof (collectively, the “LK’s Assets”) are, shall be and shall remain the exclusive property of LK, and any other use of them for any other purpose shall be prohibited. For the purpose hereof, “Intellectual Property Rights” means (i) all inventions, discoveries, know-how and technology, whether patentable or not, and all patents, registrations, invention disclosures and applications therefor, including divisions, continuations, continuations-in-part, and renewal applications, and including renewals, extensions, re-examinations and reissues; (ii) confidential information, trade secrets and know-how, including processes, schematics, business methods, formulae, drawings, prototypes, models, designs, customer lists and supplier lists; (iii) published and unpublished works of authorship, whether copyrightable or not (including, without limitation, databases and other compilations of Information), copyrights therein and thereto, and registrations and applications therefor, and all renewals, extensions, restorations and reversions; and (iv) all other intellectual property or proprietary rights.
10. Supplier shall neither have nor make any lien, pledge or other charge or any claim on LK’s Assets.
Confidentiality; Insider Trading
11. Supplier hereby undertakes, during and following the lapse or termination of the term PO (for any reason), to keep confidential all know-how which forms a part of LK’s Assets, and any knowledge or other documents connected to the performance of this PO and/or to the business of LK, its products, technology, working methods and any other information furnished to it in connection with the performance of the PO (collectively, the “LK Confidential Information”). Supplier shall not use the Confidential Information for any purpose other than the performance of the PO, and it shall not use the LK Confidential Information in any manner that may or will result in a breach of any applicable law.
Inspection of Products and Acceptance
12. All Products purchased in connection with the PO shall be subject to inspection and/or test by LK to the extent practicable at all times and places during and after the period of manufacture, at no additional charge to LK. All Products shall also be subject to final inspection and acceptance by LK within a reasonable time after delivery. No inspection or test made prior to final acceptance shall relieve Supplier from responsibility for defects or other failure to meet the specifications, instructions or other requirements set forth in, or attached to, the PO.
13. Supplier shall enable LK to carry out such tests and inspections at any reasonable time, and to this end shall set aside such appropriate samples as may be necessary, at no extra charge. The samples shall be delivered to LK at its own prior request, and in any event within such reasonable time as to enable LK to examine and approve such samples (should they be found to be suitable), within the time-frame for the execution of the PO. Inquiries relating to the conduct of such checks, and their certification shall be directed to LK’s Quality Control Manager.
14. Notwithstanding any other rights it may have, LK shall be entitled to refuse to receive either all or part of the Products, if, in its view, they do not conform to the terms of the PO. Supplier hereby accepts that the approval of receipt of the Products according to the usual practices of LK remains a prerequisite for payment of consideration for the applicable PO.
15. It is hereby affirmed that LK shall be entitled to return the Products, even after their acceptance, in the event that any defect or nonconformity in the Products be discovered within a reasonable time from the date of their delivery. In this event, Supplier shall bear the costs of transporting the Products and shall be responsible for any damage that may result to LK and/or the Products and/or third parties.
16. Supplier shall be liable for any damage and/or loss that may be caused in the course of and/or as a result of the execution of this PO to any person or property (including the employees of the Supplier and of LK), including during transit.
17. Unless the PO or the Special Terms provide otherwise, for a period of at least twelve (12) months following the acceptance of LK of each Product (the “Warranty Period”), Supplier warrants that such Product, including any industry standard (non-customized components), software installation, components and raw materials contained therein, shall be free of defects workmanship, materials, manufacture, and design, and will conform to the specifications and other instructions set forth in, or attached to, the PO. During the Warranty Period, Supplier shall repair and/or replace, at its own expense, any deficiency incompatibility or defect, and will also compensate LK, in full, for the damage and/or loss incurred by it for any of the abovementioned reasons, without derogating from any other right LK may have either under this PO or under law.
18. Supplier shall indemnify LK, on demand, for any amount which LK may be required to pay, for any damage or loss for which the Supplier is liable under the terms of this PO.
19. Supplier shall hold LK harmless, and, on demand, compensate and indemnify LK for any suit against LK relating to any Intellectual Property Rights in the Products or any part or component thereof.
20. Supplier undertakes to insure, at his own expense, against his liability under the terms of the PO.
Changes in the Terms
21. LK will be entitled to revise and make changes in these Terms so as to make it compatible with its own requirements, as it may see fit, and Supplier undertakes to carry out its future transactions with LK, including any PO, in accordance with the said changes.
Fixed and Final Prices
22. The prices stipulated in the PO are the agreed upon and final prices of the Products. Unless otherwise stipulated in the PO itself, such prices are inclusive of all taxes and levies (including in connection with import duty and customs), and inclusive of transportation and delivery costs and any other cost or expense. LK shall not pay any additional amount as might result from any changes whatsoever, including, but not limited to: changes in the cost of living index, the rate of currency exchange, costs of production, labor costs, the price of materials, taxes, tariffs, surcharges and such like.
Terms of Payment
23. Unless the PO or the Special Terms provide otherwise, the terms of payment for all Products supplied by Supplier shall be sixty (60) calendar days from the later of (i) the end of the month during which the Products were accepted by LK, and (ii) LK’s receipt of an accurate invoice. In case there is a dispute that is not resolved within the abovementioned period, payment will be due after the dispute is resolved (together with the next payment, when the next payment is due, but in any event no later than thirty (30) calendar days from end of the month during which the dispute was resolved). Unless the PO or the Special Terms provide otherwise, payment shall be made in U.S. Dollars.
Changes in the Status of Supplier
24. LK shall be entitled to cancel the PO without giving prior notice to the Supplier in the event of any of the following: bankruptcy or liquidation proceedings are commenced against Supplier; a request is submitted to appoint a receiver on Supplier’s assets; the death of the Supplier or – where the Supplier is a corporation – a change in the control or holding structure in the corporation, which is not approved by LK at its sole discretion. In the event of any of the above, LK shall be entitled, without receiving any further authorization to this effect, to enter the premises of Supplier, to take possession of, and remove from there, any of LK’s Assets and any Products the payment for which shall have been made.
25. LK shall be entitled to set off any amount owing to Supplier under the PO against any amount owing and/or that shall be owed to it by the Supplier, under said PO or in any other way.
26. Supplier shall not be entitled to set off amounts owed to it by LK.
27. No waiver, refraining from action or grant of extension by LK shall be taken as a waiver of LK’s rights under this PO, and shall not serve to prevent any action against the Supplier unless performed, explicitly and in writing, by the authorized representatives of LK.
Transfer of Rights
28. Supplier shall not transfer either all or part of the performance of the PO to any third party, without the prior written agreement of LK. Such agreement shall not release the Supplier from any of its responsibilities towards LK for the performance of this PO, in all its parts.
29. LK shall be entitled to transfer all of its rights under the PO to a third party, at its sole discretion and without obtaining the approval of Supplier.
Termination as a Result of Breach
30. Without derogating from LK’s right to any remedy under these Terms and/or under law, in the event that Supplier has breached a material condition included in the PO, LK shall be entitled to terminate the PO effective immediately, and to cause Supplier to forfeit all sums owing to Supplier for work and/or for Products ordered and supplied, up to the date of the breach, as pre-agreed damages.
Termination as a Result of Convenience
31. LK shall be entitled, at its sole discretion, to terminate the PO (in whole or in part), at any time, by giving Supplier written notice of its desire to do so. In the event of such termination, LK shall not be liable to pay compensation of any kind, over and above payment for that part of the PO that has been completed up to the date of such notice.
Relationship of the Parties
32. Nothing contained in the PO or these Terms shall be construed to create an agency, partnership or joint venture between LK and Supplier. It is further agreed and understood that neither Party nor its employees or representatives shall be deemed to be in the employment of the other and shall have no express or implied right or authority to assume or create any obligations on behalf of the other party to any contract, agreement or undertaking with any third party.
33. Without derogating from the generality of the preceding paragraph, Supplier hereby affirms that it is carrying out the work and other undertakings under an PO as an independent contractor, and that no relations of employer-employee shall persist between himself and LK and/or between LK and the employees of Supplier.
Representatives of the Supplier
34. Supplier agrees that the signature of any employee or representative on its behalf shall be binding on him with respect to the PO.
Notices and Notifications
35. Any notice with respect to the PO shall be made in writing and shall be delivered via LK’s Suppliers Collaboration System or alternatively by hand, by electronic mail, by fax or by post at the addresses set out in the PO.
Compliance with Laws, Regulations and Acts
36. In performance of its obligations under the PO, Supplier shall comply with all applicable laws, ordinances, rules, regulations, orders, licenses, permits and other governmental requirements, and shall maintain all applicable regulatory approvals, applications, licenses, requests for exemption, permits or other regulatory authorizations with the applicable regulatory agency, or any state or local regulatory body necessary to conduct its business activities (including for the manufacture and sale of the Products and for the performance of its duties and services as set forth in the PO). Supplier acknowledges that LK shall not be responsible for Supplier’s failure to comply with any of the above.
37. Consistent with Section 1502 of the Dodd-Frank Wall Street Reform and Consumer Protection Act, which was enacted in the United States in 2010, and regulations promulgated thereunder by the Securities and Exchange Commission, it is LK’s policy and expectation of its suppliers to provide Products (and any part or component thereof) free of Conflict Minerals. The term “Conflict Minerals” means cassiterite, columbite-tantalite, gold, wolframite or their derivatives originated in the Democratic Republic of the Congo or any country that shares an internationally recognized border with the Democratic Republic of the Congo.
38. Supplier’s Products shall not contain any Conflict Minerals. Upon request, Supplier shall provide LK with evidence that the Products do not contain Conflict Minerals, including, without limitation, country of origin information. If LK suspects that the Products contain Conflict Minerals, LK may immediately terminate the PO and cease all procurement activity with Supplier. Without derogating from Sections 18 and 19 above, Supplier shall hold LK harmless, and, on demand, compensate and indemnify LK for any damage or loss incurred in connection with any proceeding or suit against LK relating to any Conflict Minerals contained in the Products or any part or component thereof.
39. The rights and obligations of the parties hereto will be governed by the substantive laws of Israel, without giving effect to the conflict of laws provisions thereof. Any proceeding brought by a Party arising out of, under or relating to any dispute relating to these Terms shall be submitted to the exclusive jurisdiction of the competent courts in Tel Aviv, Israel.
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