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STANDARD PURCHASE ORDER TERMS & CONDITIONS
Clause 1 - Definitions
Unless otherwise specifically stated, the terms hereunder, when capitalized, are defined as follows:
“Article(s): Goods and/or services described in this Order.
“Buyer”: DCM Aéronautique Inc., Entreprise de Soudure Aérospatiale Inc. (Aerospace Welding Inc.) or Lego Centre de Finition Inc.., all affiliates of Groupe DCM Inc., as indicated on the Order.
“Order” or “Change Order”: Purchase order or Change Order for the Articles.
“Seller”: Natural person, partnership, association, legal person or other entity providing the Articles.
Clause 2 – Orders & Change Orders
These terms & conditions shall be part of each Order and Change Order Buyer may issue to Seller.
Clause 3 – Agreement, Acceptance & Modifications
An Order isBuyer’s offer to Seller. Seller’s acknowledgement of this Order,commencement of performance or delivery of the Articles described inthis Order shall constitute acceptance of such offer by Seller. Sellershall have 10 days to refuse the offer or to request an amendmentthereto. No change or modification to this Order, including anyadditional or different terms in Seller’s acceptance, shall be bindingon Buyer unless signed by Buyer’s authorized representative.
Clause 4 - Changes
Buyer may,upon written notice to Seller, make changes to the Order or to anyelement of the Order, including but not limited to specifications,quantity, delivery date, method of shipment and packaging. Seller shallproceed immediately with the Order as changed. If the costs materiallyincrease or decrease as a result of the change, Buyer and Seller willagree on an equitable price adjustment to the Order. If Seller fails oromits to provide written notice of a cost impact to Buyer within 10 daysof the receipt of the Change Order, the price shall be deemed acceptedby Seller.
Clause 5 – Stop Work Notice
Buyer may,upon written notice to Seller (“Stop Work Notice”), order that all workbe stopped in which case Seller shall immediately cease all activitiesrelated to the Order. This Stop Work Notice may be valid for up to 180days at no extra costs to Buyer. When resuming the Order, Seller’sdelivery schedule shall be adjusted by a reasonable delay which in nocase shall exceed the period of the Stop Work Notice.
Clause 6 – Termination for convenience
Buyer may,upon written notice (“Termination Notice”), terminate for itsconvenience the whole or part of this Order. Upon receipt of suchTermination Notice, Seller shall stop performance of all activitiesrelated to the Order, including any procurement of materials andservices on the cancelled portion of the Order. Once Seller’s claim isreceived, Buyer and Seller shall agree on an equitable adjustment of theOrder price, which in no case shall exceed the total Order price. IfSeller fails to file a claim with Buyer within 60 days of issuance ofthe Termination Notice by Buyer, Seller shall have no remedy after thisperiod.
Clause 7 – Termination for default
If Seller isin default of carrying out any of its obligations under this Order,Buyer shall, prior to termination, give Seller a 10-day written noticeduring which Seller shall cure the default.
If Sellerfails to cure the default during the specified cure notice period, orbecomes bankrupt or insolvent, makes an assignment for the benefit ofcreditors or takes the benefit of any statute relating to bankrupt orinsolvent debtors, Buyer may cancel the Order and the Order shalltherefore be automatically terminated.
Buyer mayterminate the whole or only a part of the Order. Upon such termination,Seller shall have no claim for further payments and shall be liable toBuyer for any excess costs paid by Buyer in procuring the terminatedportion of the Order from another source as well as any direct damagesincurred by Buyer as a result of Seller’s default.
Clause 8 – Excusable delay
A delay inthe performance of Seller’s obligations under the Order which is causedby an event which (i) is an act of God, act of government, terrorism,fire, riot or war and (ii) interferes with the performance of Seller’sobligations and (iii) the effects of which could not have reasonablybeen avoided by Seller shall constitute an excusable delay.
Seller shallnotify Buyer in writing upon the occurrence of the event and willdiligently work with Buyer in coming up with an acceptable work-aroundplan which will limit the impact of such delay on the delivery schedule.
If theexcusable delay lasts for more than 30 days, Buyer shall have the rightto terminate the whole or any part of the Order in accordance with theprovisions of Clause 6 (Termination for Convenience) herein.
Clause 9 – Quality Control
Seller shallcomply with Buyer’s quality requirements. Seller shall also comply withthe requirements of its civil airworthiness authority (Transport Canada,Federal Aviation Authority or other foreign airworthiness authority asmay be applicable).
Buyerreserves the right, upon reasonable prior notice to Seller, to auditSeller’s quality manual, and to verify the conformance of Seller’sprocedures, manufacturing processes and procedures and acceptance ofArticles to Buyer’s quality requirements. Seller shall provide, at nocost to Buyer, appropriate facilities to perform such audits andverifications during normal business hours.
Seller shallallow Buyer’s customers, upon reasonable prior notice, to audit Seller’squality manual, and to verify the conformance of Seller’s procedures,manufacturing processes and procedures and acceptance of Articles tosuch customers’ quality requirements. Seller shall provide, at no costto Buyer’s customers, appropriate facilities to perform such audits andverifications during normal business hours.
All Articlesare subject to final inspection and acceptance by Buyer at destination,notwithstanding any payment or prior source inspection by Buyer atSeller. Inspection and tests by Buyer do not relieve Seller ofresponsibility for defects or other failures which may later be foundduring the warranty period.
Clause 10 – Warranty
Sellerwarrants that all Articles delivered under this Order will be free fromdefects in design, material and workmanship and will conform to all therequirements contained in the Order, including all applicable drawingsand specifications. All Articles are subject to final inspection andacceptance by Buyer. The final inspection will be made within areasonable time, not-to-exceed 90 days after receipt at Buyer. DefectiveArticles shall be returned to Seller at Seller’s expense for repair orreplacement at Buyer’s option. Buyer, at its option, may also performthe necessary repair and charge the reasonable costs thereof back toSeller.
This warrantyshall be in addition to all warranties arising as a matter of law andshall be enforceable by Buyer’s customers as well as Buyer for a periodof 36 months after delivery of the Articles to Buyer.
Clause 11 – Prices, invoicing and payment
Seller shallinvoice Buyer at the prices stated on the Order. All invoices willindicate the Order number, Article description, quantity, unit price andtotal price of the Articles as well as the payment to address, amountof applicable taxes and Goods and Services Tax (GST) and QuebecProvincial Sales Tax (PST) registration numbers.
Buyer shallpay Seller within 90 days from the latter of (i) Buyer’s receipt ofacceptable Articles, (ii) applicable delivery date specified on theOrder or (iii) receipt of Seller’s invoices.
Clause 12 – Delivery
Time is ofthe essence in performing Seller’s obligations under the Order. TheArticles shall be delivered complete on the delivery date, and notbeforehand, and at the place specified on the Order. If Seller deliversan Article or Articles prior to the delivery date on the Order, Buyerreserves the right to retain the Articles and make payment per theapplicable Order schedule or return them to Seller at Seller’s expense.If Buyer opts to retain the Article or Articles, payment shall be madein accordance with the provisions of Clause 11 hereinabove.
Alldeliveries by Seller shall be made FCA Seller (Incoterms 2010) andSeller shall use the carrier designated by Buyer. Buyer shall debitSeller’s account for all applicable freight costs incurred by Buyer ifSeller uses a carrier other than that designated by Buyer.
Clause 13 – Packaging
All Articlesmust be suitably packaged and prepared for shipment to withstand normaltransportation and stocking functions. Containers must be in accordancewith best commercial practices and all applicable laws. When multipleOrders or Articles are combined in one container, they must beseparately packaged inside that container.
A separateinvoice and a separate packing list are required for each Order and mustaccompany each shipment. Seller will provide bar coded shipping labelswith each shipment. When required on the Order, Seller shall alsoprovide a certificate of compliance (CofC) duly signed by its authorizedrepresentative certifying the compliance of the Articles to alldrawings and specifications contained in the Order. All documents mustinclude the applicable Order number.
Clause 14 – Hazardous materials
Sellercertifies that it is in compliance with any federal or provincial lawsand regulations in force in Canada, as well as any federal or state lawsand regulations in force in the United States, including but notlimited to the U.S. Occupational Safety and Health Act (OSHA) and theCanadian Hazardous Products Act, as may be applicable.
If theArticles purchased herein are considered toxic or hazardous under theabovementioned laws and regulations, Seller shall provide a copy of theapplicable Material Safety Data Sheet (MSDS) with each shipment.
Clause 15 – Government regulations – Import / Export of Articles and data
The Articlesand data provided under the Order may be subject to the provisions ofthe Export Administration Act and the Export Administration Regulationspromulgated thereunder; the Arms Export Control Act and theInternational Traffic in Arms Regulations (ITAR) promulgated thereunder;the Canadian Export and Import Act; the Defense Production Act and theForeign Corrupt Practices Act.
The Partiesacknowledge that these statutes and regulations impose restrictions onimport, export and transfer to third countries of certain categories ofdata and Articles and that licenses from the U.S. Department of Stateand/or the U.S. Department of Commerce and/or the Canadian Department ofForeign Affairs and International Trade may be required before data andArticles may be provided hereunder. Seller agrees to comply withgovernmental regulations mentioned above as they relate to the import /export of data and Articles. Seller shall indemnify and hold Buyer andits customers harmless to the full extent of any loss, damage orexpense, including lost profit, attorney’s fees and court costs, for anyfailure of Seller to comply with the above referenced laws andregulations.
Clause 16 - Indemnification
Seller agreesto indemnify, defend and hold harmless Buyer and customers from andagainst any and all losses, costs and expenses of any kind whatsoever inconnection with any breach by Seller of third-party proprietary orintellectual property rights, except to the extent caused by Buyer.
Each partyshall hold harmless the other party from and against any and alldamages, losses or other injuries suffered by either one of the partiesor by third parties and that result from its fault or negligence duringthe performance of the Order or result from the poor quality of theArticles described in the Order.
Clause 17 – Occupational Health and Safety
Sellerundertakes, at all times during the performance of the Order, to takethe necessary measures to protect its employees against industrialaccidents and to comply, at all times, with any laws or regulations inforce in the Province or Territory having jurisdiction over itsemployees. Should a part of the Order be subcontracted, Seller shallhave the obligation to ensure that all subcontractors also comply withany laws or regulations governing the occupational safety of theiremployees.
Clause 18 – Disputes
The Partiesshall attempt to resolve any disputes by escalating the matter throughtheir respective management structures. If the Parties fail to resolvethe dispute, they may submit the dispute to the tribunals identified inClause 18 – Applicable law and venue. Pending final resolution of thedispute, Seller shall proceed diligently with the performance of theOrder as directed by Buyer.
Clause 19 – Applicable law and venue
The Order,including these terms and conditions, are governed by and construedexclusively by the laws of the Province of Quebec and those of Canadaapplicable therein, without reference to its conflict of law rules. TheParties agree to submit any dispute related to the Order to thetribunals of the Province of Quebec, district of Montreal.
The Parties agree that these terms and conditions and any document referenced herein or in the Order be drafted in English. LesParties aux présentes ont convenu que ces termes et conditions ainsique tous les documents s’y rapportant, incluant le bon de commande,soient rédigés en Anglais seulement.
Clause 20 – Partial invalidity; Non-Waiver
If anyprovision of the Order or of these terms and conditions becomes null andvoid or unenforceable, the other provisions shall remain valid andenforceable.
The failureof Buyer to enforce, at any time, any of the provisions of the Order orof these terms and conditions or to require at any time the performanceby Seller of any of the provisions hereof, shall in no way be construedto be a waiver of the right to enforce such provisions, nor in no wayaffect the validity of the Order and these terms and conditions or theright of Buyer to enforce such provisions.
Clause 21 – Order of precedence
In the eventof any inconsistency among the provisions of the Order, suchinconsistency shall be resolved by giving precedence in the followingsequence:
· Provisions contained in the Order
· Long term agreement, Master agreement or other agreement, as applicable
· These terms and conditions
· Statement of work, as applicable
· Specifications, as applicable
· Other document, as applicable
Clause 22 – Entire Agreement
The Order,including these terms and conditions and all documents referred therein,constitute the entire agreement between the Parties and supersedes andreplaces all prior discussions, representations, understandings oragreements whether oral or written, between the Parties.
AEROSPACE WELDING INC. QUALITY CLAUSES FOR TYPE A & B SUPPLIERS
Products and services purchased by Aerospace Welding Inc (AWI) are grouped into the two (2) principal categories identified as Type A and Type B suppliers. (See Annex 1 if you are unsure where to find your supplier type on your purchase order). If your purchase order indicates that you are either one of these providers you must meet the following requirements that each of them includes:
Allsuppliers are also subject to our standard purchase order terms andconditions which are available on Aerospace Welding’s website.
Categories of products for Type A suppliers
A. Outside Special Process:Must be manufactured and processed completely to drawing requirements.All specifications referenced therein, and all P.O. requirementsincluding such items as part marking, identification, inspection,stamps, certification, inspection records, etc. All special processesthat are called out on the PO, engineering drawings or specificationsmust be carried out by OEM approved sources.
B. Fabrication:Sheet metal fabrication, tool and die making, castings, extrusions andmoldings, fusion and adhesive bonding, machining, heat treating,fabricated hardware and mechanical assembly.
C. Special Process:This category involves suppliers who perform a production process, theresults of which cannot be fully verified by subsequent verification andtesting of the product and where, for example, processing deficienciesmay become apparent only after the product is in use. Accordingly,continuous monitoring and/or compliance with documented procedures arerequired to ensure that the specified requirements are met. Examples ofspecial processes are: Fusion welding, resistance welding, thermalspray, liquid penetrant inspection, chemical cleaning.
D. Calibration:This category involves suppliers who perform calibration of measuring,monitoring and testing equipment for AWI. Calibration labs must meetthe requirements of ISO/IEC 17025:2005or its equivalent and have a system of traceability to national orinternational recognized standards. A certificate of Calibration mustbe included with each instrument calibrated.
E. Raw Material and tooling: This category involves suppliers who must purchase from an approved mill, and have complete traceability.
F. OEM Equipment: Thiscategory involves suppliers who provide original parts, components,subassemblies, and/or complete assemblies. Suppliers for these typesof products are required to have a quality system which meets thoserequirements defined within ISO, AS, or equivalent.
Note: For all Lockheed Martin Aeronautics products the Supplier must utilize approved sources per QCS-001.
For all Bombardier Aerospace products the Supplier must utilize approved sources per QD 4.6-40.
Quality Clauses for Type A supplier:
1. Third party sub-contracting
If during theaccomplishment of the contract, the supplier intends to sub-contractwork to a third party, this third party shall also be subjected toAerospace Welding’s evaluation of its capabilities in the same manner asdescribed above. ONLY upon Aerospace Welding’s written consent can thisthird party be utilized by the supplier as services.
The supplier is responsible to flow down to their sub-tiers all conditions and requirements set forth by AWI and its customers.
2. Notification of Changes
Seller shallnotify buyer, in writing, within ten (10) days of any (1) change in itsquality system status resulting in loss of 3rd party registrar’scertification; or (2) adverse action initiated by Buyers customer, theGovernment, the Federal Aviation Agency (FAA), or the Civil AviationAgency (CAA) resulting in disapproval or suspension of Seller’s qualitysystem. Seller shall notify Buyer, in writing, at least ninety (90) daysin advance of any sale, relocation, or transfer of any portion ofSeller’s manufacturing operations.
3. Non-Conforming products
Notify AWI of any nonconforming product and obtain organization approval for nonconforming product disposition before and after delivery.
The supplier shall provide effective corrective and preventive action in a timely manner upon requestby Buyer. When requested by Buyer, Seller shall provide trend data andfindings. Seller shall identify true root cause findings and correctiveand preventive action(s) to preclude recurrence by utilizing tools suchas cause mapping, cause and effect analysis, 5 why’s etc.
The suppliershall implement and maintain a documented quality system that providesfor identification, documentation, and disposition of nonconformingmaterial.
4. Waiver / Deviation Requests
The suppliershall ensure that written authorization has been granted by an AWIrepresentative with authority to do so prior to the shipping of theproduct which does not conform to the specified requirements for theproduct.
5. Documentation and Record control
Identify thelatest revision status of specifications, drawings, processrequirements, inspection / verification, instruction and other relevanttechnical data used for the processing of AWI work.
Must retainall contractual records for ten (10) years and make them available uponrequest to AWI within 48 hours of the request.
All quality records shall be returned to AWI in the case where the supplier’s business operations terminate.
6. Right of Access
Must allowAerospace Welding Inc., Regulatory Authorities, and their customers, theright of access to the applicable areas of all facilities, at any levelof the supply chain involved in the order, and to all applicablerecords. Aerospace Welding Inc reserves the right to perform an audit atthe supplier if it is necessary.
7. Quality Management System
The supplier shall maintain an ISO, AS, Military Standard equivalent quality system acceptable to Buyer.
8. Counterfeit parts / Non-Certified Materials
Supplieragrees and shall ensure that Counterfeit Work is not delivered to AWI.The supplier shall immediately notify AWI with the pertinent facts ifthe supplier becomes aware or suspects that it has furnished CounterfeitWork. When requested by AWI, the supplier shall provide appropriatedocumentation that authenticates acceptable traceability of the affecteditems
Seller shallestablish and maintain controls to prevent the use of non-certifiedmaterials when certified materials are required.
9. Foreign object damage / debris (FOD)
Seller shallmaintain a FOD prevention program and when the potential for FODentrapment or migration can occur during manufacturing or processing bythe supplier’s subcontractor(s), Seller shall ensure flow down ofapplicable FOD requirements to the subcontractor(s).
The suppliershall calibrate or have calibrated by an external certified source alltesting and inspection equipment used in the manufacture and acceptanceof AWI’s products/parts.
Seller shallmaintain a documented calibration system for the calibration andmaintenance of tools, jigs, inspection and test equipment.
11. Special processes
All special processes mustbe performed by purchaser or customer approved facilities. The suppliershall list all of the sources used to perform special processes ontheir certificate of conformance and identify which source completedwhich special process.
12. First Article Inspection Report
Whenrequested by the purchase order, the supplier is responsible forcompleting a first article inspection report which is in accordance withSAE standard AS9102 latest revision. It is recommended that thesupplier use the checklist (or similar document) contained in Appendix Fof the AS9102 standard to ensure all FAI requirements have beenfulfilled prior to submission.
The product used to complete the first article inspection shall be identified as such.
13. Purchaser supplied material
The supplier shall not substitute other material without specific written authorization of AWI. (See Quality Clause # 4 above)
14. Inspection and Testing
The suppliershall work within and inspect tolerances and limitations specified onthe drawings and test specifications covering the work and shall makesuch tests as are specified by the drawings and specifications. Onlyqualified personnel shall perform inspection and testing.
The suppliershall have a system in place to identify the inspection status of theproduct as it is being produced for conformance or non-conformance withregards to inspection tests performed. The inspection status of eachproduct should be easily identifiable using routers, stamps, tags, etc.the system shall ensure that only the products that have passed all ofthe required inspection tests are released, used or installed.
15. Handling, Storage, Protection and Preservation
Packaging andpreservation shall be completed in a manner that ensures adequateprotection against damage, deterioration and tampering during shipment,storage and distribution.
The supplier is responsible for labeling the package in a manner which ensure it is easily identifiable.
16. Release documents (Certificate of Conformance or Form 1 / US FORM)
Whenrequested on the purchase order a certificate of conformance, signed byan authorized member of the suppliers company, must be shipped insidethe package with the part to AWI. The certificate shall contain atminimum the following information:
a) Supplier name and address
b) Purchase order number
c) Unique identification number of certificate
d) Authorized signature
e) Material specification and revision (if applicable)
f) Part number and revision
g) Serial number and or lot number ( if applicable)
i) List of special processes performed including the sources who performed them (if applicable)
j) Astatement indicating the material/part/process has been completed,inspected and is in conformance to the applicable drawing, and orspecification and purchase order
The suppliershall have objective evidence that the personnel performing processoperations and quality inspection or test functions have been trainedand properly qualified to perform their tasks.
Categories for Type B suppliers
Suppliers in this category involve suppliers / distributors who may provide but are not limited to:
A. Consumables: Itemssuch as ear plugs, safety glasses, steal toe boots, basic work gloves,etc. which are used on a daily basis but which do not requiretraceability to AMO.
B. Contractors: Supplierswho complete contract work which does not directly or indirectly impactthe quality of products produced for or by AWI. Ex: Landscaping, snowremoval, etc.
C. Office supplies: Items such as telephones, computer software, computer paper, and all other clerical office supplies needed.
D. Furniture: Items such as desks, computer chairs, shelving units, etc.
E. Consultants: Any person who is hired to provide expert advice to Aerospace Welding Inc.
Quality Clauses for Type B supplier:
Distributors / Consumables:
1. Non-Conforming products
The suppliershall provide effective corrective and preventive action in a timelymanner upon request by Buyer. When requested by Buyer, Seller shallprovide trend data and findings. Seller shall identify true root causefindings and corrective and preventive action(s) to preclude recurrenceby utilizing tools such as cause mapping, cause and effect analysis, 5why’s etc.
2. Handling, Storage, Protection and Preservation
Packaging andpreservation shall be completed in a manner that ensures adequateprotection against damage, deterioration and tampering during shipment,storage and distribution.
Distributorsmust have a system which ensures that materials are stored, identified,packaged and preserved properly and includes a system of traceabilitywhich ensures that any product shipped to AWI is traceable to theoriginal manufacturer including all batch or lot numbers applicable.
3. Waiver / Deviation Requests
The supplier shall ensure that writtenauthorization has been granted by an AWI representative with authorityto do so prior to the shipping of the product which does not conform tothe specified requirements for the product.
4. Right of Access
Must allow Aerospace Welding Inc.,Regulatory Authorities, and their customers, the right of access to theapplicable areas of all facilities, at any level of the supply chaininvolved in the order, and to all applicable records. Aerospace WeldingInc reserves the right to perform an audit at the supplier if it isnecessary.
Note: If youhave any questions about the vendor type applicable to your company, donot hesitate to contact a purchasing agent or a quality representativefor clarification.