Pratt & Whitney Canada Corp. and/or its designated affiliate ("Seller") will deliver the new or used parts, exchange parts, and/or repair services, collectively defined as "Deliverables" covered by the Order FCA (Incoterms 2010) to Buyer's carrier at the facility in which the Deliverables will be shipped by Seller. Title and risk on new and/or used parts shall pass to Buyer upon delivery. Risk on exchange parts and repair services shall pass to Buyer upon delivery. Title on exchange parts shall pass to Buyer upon receipt of acceptable repairable core part. In the event delivery is delayed due to actions or omissions of Buyer, Seller may, in its discretion, charge reasonable storage fees.
Buyer is responsible for all taxes, duties and other charges of any nature whatsoever, including interest and penalties thereon, arising from the sale, delivery or use of the Deliverables under the order, and will reimburse Seller for any such charges Seller may be required to pay directly to any government authority or to a designated facility.
Seller may at any time make improvements and minor changes to the Deliverables which do not affect price, installation or the interchangeability of major parts. No other modification of the order is binding unless agreed to in writing by both parties.
Seller is not responsible for any failure or delay in performance resulting from causes beyond Seller's reasonable control. These may include, but are not limited to, acts of government, court order, civil unrest, sabotage, adverse weather conditions, labor problems and shortage of materials or services. Seller will give timely notice to the Buyer of any such event and shall use reasonable efforts to avoid or remove the cause and resume performance with minimum delay. The time for delivery will be extended accordingly.
WARRANTY AND INDEMNITY FOR PATENT INFRINGEMENT
A. Seller warrants to Buyer that, at time of delivery
i. New parts will be free from defects in material and/or manufacturing workmanship and will conform to applicable Seller specifications. Seller will repair or replace defective new parts, provided that written notice of the defect is received from the Buyer within five hundred (500) engine operating hours or ninety (90) days from first use by the original operator, whichever occurs first, but in no event later than twelve (12) months from the date of the initial shipment of the new parts by Seller; and
ii. Used parts and repair services will be free from defects in material and/or repair workmanship and will conform to applicable Seller specifications. Seller will replace or repair material certified by Seller or Seller's supplier using a Seller approved repair, within 2000 hours / 2 years from the date of initial shipment of the used or repaired part by Seller, whichever occurs first (with the exception of fuel nozzles, electronic engine controls, or torque controls), provided that the claim is made within such maximum number of operating hours and time after delivery. For fuel nozzles, electronic engine controls or torque controls, Seller will replace or repair within 1000 hours/ 12 months from the date of initial shipment of the goods by Seller, whichever occurs first, and prior to next original equipment manufacturer specified maintenance occasion, provided that the claim is made within such maximum number of operating hours and time after delivery
iii. Reasonable transportation charges (excluding insurance, duties, brokerage fees and taxes) are accepted for parts returned to a facility designated by Seller's Warranty Administration in accordance with Seller's shipping instructions.
B. Exclusions & Limitations: The warranties described above do not cover
i. Costs of normal scheduled maintenance services, including: (1) routine line maintenance and adjustment costs; (2) hot section inspection (HSI) and refurbishment costs; (3) parts overhaul or major refurbishment costs; and (4) any other costs related to part maintenance not specifically covered hereunder;
ii. Normal Deterioration, including: (1) normal wear and tear and deterioration resulting of normal part operation or as the result of the installation of a known defective engine part by the customer under a concession granted by the FAA or an OEM (other than Seller); and (2) overhaul life of assemblies, service life limits or parts, and/or operating time limits;
iii. Unsupported parts, including the following, or subsequent repairs or damages that are directly attributable to the use of one of the following: (1) part that are not originally supplied by Seller or its authorized distributors and accompanied by Seller Manufacturer's Release Certificate or Canadian Department of Transport Certificate of Airworthiness, as applicable (including parts approved under an FAA Parts Manufacturer Approval (PMA) or international airworthiness equivalent); (2) parts that are not identified in the applicable Seller Illustrated Parts Catalogue ("IPC") and accompanied by the supplier's Release Certificate; (3) parts that are not repaired in accordance with Seller approved repair processes; (4) parts that are not traceable, e.g. insufficient supporting documentation; or (5) parts that have been involved in an accident;
iv. Factors beyond Seller's control, including: (1) improper storage, usage, maintenance or operation of the part that is not consistent with the instructions and procedures of Seller, the aircraft manufacturer or the airworthiness regulations (including abuse, misuse, neglect or experimental use); (2) any work performed on parts without due cause such as pre-purchase inspections, or scheduled maintenance performed at other than Seller recommended intervals; (3) accidents, collisions, propeller strikes, fire, flood, lightning strike, theft, explosion, riot, war, rebellion, seizure or any other belligerent acts; foreign object damage (FOD), erosion, corrosion, sulphidation or any other damage due to the operating environment; (4) alteration to, modification of, or tampering with any part after delivery by Seller, other than strictly in accordance with the terms herein and applicable Seller manuals; (5) use of stolen parts, or use of a part from which Seller's name, part number, identification mark or serial number has been removed or defaced; (6) workmanship performed by a facility other than Seller owned-manufacturing facilities; (7) repair or overhaul of a defective part at a facility other than a facility designated by Seller.
C. For the Deliverables supplied by Seller under this Order, Seller shall, as the sole liability of Seller in respect of any claims for infringement of intellectual property rights, defend and hold harmless Buyer from and against any claim and related damages, costs and reasonable attorney's fees, that the use or sale of such Deliverables without further combination infringes any Canadian or U.S. patent, provided that Seller shall not be liable for (a) any special, indirect, incidental or consequential damage or any damage such as economic loss or loss of profits resulting from any loss of use of the Deliverables or of the aircraft in which the Deliverables was incorporated, arising as a result directly or indirectly of any such claim, or (b) any exemplary, punitive or other similar damages not attributable to the acts of Seller. Buyer will give immediate notice in writing to Seller of any such claim and give Seller full information and authority to assume the sole defence thereof whereupon Seller shall have the right at its own expense to assume the defence of or to dispose of or to settle such claim in its sole discretion and Buyer will give Seller all reasonable assistance and will not by any act or omission do anything that may directly or indirectly prejudice Seller in this connection. Seller shall have the right to substitute for any allegedly infringing Deliverables substantially equivalent non-infringing Deliverables. If the provision of Deliverables or use or sale of the Deliverables is finally prohibited as a result of such claim, Seller shall, at Seller’s option and expense, (1) procure the right to use or sell the Deliverables, (2) replace the Deliverables with a non-infringing equivalent, (3) modify the Deliverables so it becomes non-infringing, but equivalent, or (4) take back the Deliverables and refund the price (less a reasonable allowance for use or damage). Notwithstanding anything in this Section 5C to the contrary, the obligation to defend and hold harmless herein shall not apply to claims for infringement in respect of Deliverables manufactured to the specific design instructions of Buyer. NOTWITHSTANDING ANY OTHER AGREEMENT TO THE CONTRARY, THE REMEDIES FOR INTELLECTUAL PROPERTY INFRINGEMENT PROVIDED IN THIS SECTION 5C ARE GIVEN BY SELLER AND ACCEPTED BY BUYER AS THE SOLE AND EXCLUSIVE REMEDIES FOR BUYER FOR INTELLECTUAL PROPERTY INFRINGEMENT IN CONNECTION WITH DELIVERABLES HEREUNDER, TO THE EXCLUSION OF ANY OTHER REMEDIES.
Notwithstanding anything to the contrary, i) the above warranties as set out in section 5A and remedies for intellectual property infringement as set out in section 5C are given by Seller and accepted by the Buyer in place of all other express, implied or statutory terms, representations, warranties or conditions, in contract or in tort, including without limitation, any warranty or condition of merchantability or fitness for a particular purpose, in connection with an engine or Deliverable defect, non-conformity to the applicable specification and any intellectual property infringement and all such other terms, representations, warranties or conditions are hereby expressly disclaimed, and ii) the only remedy for breach of the warranty and for patent infringement is as set out herein. For greater certainty, in no event shall Seller be responsible for any special, incidental, indirect or consequential damages arising out of or in connection with either a breach of such warranty or for intellectual property infringement, or any tortious or negligent act or omission by Seller, or any exemplary, punitive or other damages not attributable to acts of Seller. Special, incidental, indirect or consequential damages include, without limitation, economic loss, loss or damage to any property or person or any other exemplary, punitive or similar damages, as well as expenses incurred external to the engine. No variation or extension of the foregoing warranty or intellectual property infringement indemnification or associated remedies shall be binding unless in writing and signed by a duly authorized representative of Seller. Buyer's acceptance of the foregoing or the making of any claim or receipt of any benefit there under, constitutes Buyer's acceptance of all the foregoing terms, conditions and limitations. In no event shall Seller's liability exceed the price on the face of the order, whether based in contract, strict liability, fault, tort, or any other asserted right.
TERMS OF PAYMENT
The Buyer's payment terms shall be "Cash Before Shipment" pending a credit review to establish payment terms. Upon credit approval by Seller, such payment terms shall be net thirty (30) days from the date of the invoice. Upon receipt of the results of the credit verification, Seller shall indicate to the Buyer in writing as to what the applicable terms of payment shall be. In certain instances, notwithstanding the payment terms, a deposit may be required for the manufacturing of the Deliverables and/or prior to shipment. The amount of the said deposit shall be determined by Seller at its sole discretion. Overdue accounts are subject to interest calculated and compounded monthly at the rate of fifteen percent (15%) per annum or United States Prime Rate, plus five percent (5%) per annum, whichever is greater, without exceeding the maximum rate allowed per applicable law. Buyer shall not delay payment for the Deliverables or related services pending, or based on the results of, its inspection or acceptance.
Buyer's order constitutes acceptance of all the terms and conditions hereof, which shall apply to the exclusion of any terms and conditions contained in any order or communication of Buyer not specifically agreed to in writing by Seller. Seller's acceptance of Buyer's order for the purchase of Deliverables is expressly made conditional on Buyer's acceptance of the terms contained herein.
Any shipment discrepancy or receipt or incorrect Deliverables against Buyer's order must be reported in writing to Seller within thirty (30) days of the date of shipment. Seller shall not be responsible for any discrepancy reported after thirty (30) days.
All Deliverables being returned, regardless of reason, will require the issuance of a "Return Material Authorization" (RMA) number from Seller prior to the physical return of the Deliverables. Issuance of an RMA does not constitute acceptance of the return by Seller. Returns will be reviewed on a case by case basis including warranty returns as outlined in Section 5 above. Re-stocking charges of 15% of the invoice amount may apply.
Buyer agrees to comply with all applicable Canadian and US export and import laws and regulations. Performance hereunder is subject to the receipt of any necessary governmental export or import license, permit or similar authorization ("Authorization") under all applicable export, import and customs laws, including Canadian and U.S. export, import and customs laws ("Export Law"), affecting the goods or services and any associated technical data provided hereunder or any part thereof. No U.S. International Traffic in Arms Regulations ("ITAR") controlled goods, services or technical data shall be provided to the Seller pursuant hereto. Notwithstanding any other provision, the Seller shall have no liability (including no obligation to provide substitute goods or services or technical data), nor shall it be in breach, if for any reason any government fails to issue or renew or cancels any Authorization or delays in issuing or renewing any Authorization affecting any goods or services or any associated technical data provided hereunder or any part thereof.
Export Law prohibits the export of goods, or provision of services to embargoed or sanctioned countries or to those entities and individuals that are restricted or denied parties ("Prohibited Parties"). Except as specifically authorized by Export Law, goods or services purchased from the Seller may not be re-exported, resold, or otherwise disposed of: (1) to any country not approved for re-export as brought to the Buyer's attention by means of a bill of lading, commercial invoice, or any other means; or (2) to any person if the Buyer knows, or has reason to know, that it will result directly or indirectly, in disposition contrary to the obligations made in these conditions of sale or contrary to the Export Law. Specifically, pursuant to Supplement 2 to 15 CFR §749(o)(3) of the U.S. Export Administration Regulations ("EAR"), goods or services purchased from the Seller may not be re-exported to a country listed in Country Group E:1 (Country Groups are listed in Supplement 1 to Part 740 of the EAR).
Seller may terminate the order at any time by written notice to Buyer if Buyer fails to pay any amount when due or if Buyer becomes insolvent or performs or permits any act of bankruptcy, liquidation, reorganization or if a receiver, trustee or custodian is appointed to Buyer or a substantial part of Buyer's assets. In addition, Seller may terminate the order if Buyer is in default under the terms of any other agreement or order with Seller or any affiliated company of Seller. On termination, Seller shall have no further obligation to Buyer under the order and Buyer will reimburse Seller's termination costs, including, without limitation, a reasonable allowance for profit as well as material, labor and administrative fees. Buyer shall reimburse Seller for all attorneys' fees and other expenses incurred by Seller in recovering any sums due from Buyer regardless of whether the order has been terminated or not. The Buyer may not terminate the order, otherwise he is liable for damages caused to Seller as a result of the termination including, without limitation, costs and expenses as well as for the value of the work performed by Seller before termination of the order including, without limitation, a reasonable allowance for profit.
Absent Seller's prior written consent, any assignment or attempted assignment shall be wholly void, invalid and totally ineffective for all purposes.
LANGUAGE AND GOVERNING LAW
Both parties have agreed that these conditions be written in the English language only. Les parties ont convenu que les présentes soient rédigées en anglais seulement. This contract shall be governed by and interpreted in accordance with the substantive and procedural laws in force in the Province of Ontario, Canada. Any provisions of such laws i) requiring the application of laws of another jurisdiction to all or part hereof; or ii) regarding choice of law, shall not apply. Pursuant to Article 6 of the United Nations Convention on Contracts for the International Sale of Goods, the parties exclude the application of the provisions of said convention to all transactions relating hereto.