The following terms and conditions of sale are subject to change.

1. GENERAL: These terms and conditions of sale apply to all sales of Lovato Electric, Inc (“Lovato USA”), unless modified in writing by Lovato USA. Lovato USA expressly rejects any other terms and conditions as may be proposed by Distributor or the end Purchaser. A contract upon the conditions and terms herein (including terms of identification of products, quantity, shipping and billing) shall be deemed to have been entered into when, on receipt of an order, Lovato USA acknowledges acceptance in writing. All sales are governed by and subject to the laws of the Commonwealth of Virginia without regard to its conflicts of laws provisions.

2. TECHNICAL INFORMATION: Documents such as catalogs, drawings, and specifications related to products sold by the Lovato USA are to be used only as an approximate guide and may not reflect latest designs or accurate technical details of products. Lovato USA reserves the right to make any changes in its products that it considers necessary in its sole discretion.

3. PRICES AND QUOTATIONS: Prices are subject to change without notice. Written or verbal quotations are valid for 30 days.

4. TERMS OF PAYMENT: Terms of payment are Net thirty (30) days from date of invoice with approved credit as determined by Lovato USA. Lovato USA retains exclusive right to determine credit worthiness of Distributor. Payments shall be made in U.S. currency to address of Lovato USA without any deductions of any kind. Unpaid accounts may result in interruption of supply. In addition, interest may accrue at the rate of 1 1/2% per month on unpaid balances but not to exceed the maximum permitted by law.

5. DELIVERY: Delivery terms are FCA, Free Carrier (INCOTERMS 2000) Lovato USA’s facility, Chesapeake, Virginia with respect to shipping costs, risk of loss and title transfer. Lovato USA will not be liable for any loss, damage or delay arising out of its failure to perform hereunder due to causes beyond its reasonable control, including without limitation, acts of God or Distributor, acts of civil or military authority, fires, strikes, floods, epidemics, quarantine restrictions, war, riots, raw materials shortages, delays in transportation, or transportation embargoes. In the event of any such delay, Lovato USA’s performance date(s) will be extended for that length of time as may be reasonably necessary to compensate for the delay.

6. SHIPPING TIMES: Acknowledged dates of delivery in accordance with Paragraph 5 are approximate and are based on receipt of all necessary information, required materials to complete the order, are dependent on prevailing conditions at the time of quotation, and are not guaranteed.

7. RETURNS: All returns of Products must be approved in writing by Lovato USA prior to return. Non-warranty returns of unused and salable Products for credit will be subject to the Lovato USA Annual Stock Rotation and Return Policy and any other of Lovato USA’s return policies as may be in effect at the time, including applicable restocking charges and other conditions of return. Products returned under warranty must be properly packed and shipped to Lovato USA-specified locations.

8. LIMITED WARRANTY: Lovato USA warrants for a period of one (1) year from delivery in accordance with Paragraph 5, that product manufactured by it will be free from defects solely due to material, workmanship and design. This warranty does not cover defects caused by wear and tear, accident, misuse, improper installation, or neglect, as determined solely by Lovato USA. Warranty shall be limited to Lovato USA’s option of repair or replacement at Lovato USA’s facility. With respect to equipment sold but not manufactured by Lovato USA, the warranty obligations of Lovato USA shall in all respects conform and be limited to the warranty actually extended to Lovato USA by the manufacturer. The foregoing warranties do not cover reimbursement for labor, transportation, removal, installation or other expenses which may be incurred in connection with repair or replacement. THIS LIMITED WARRANTY IS AN EXCLUSIVE WARRANTY AND IN LIEU OF ALL OTHER WARRANTIES WHETHER EXPRESSED, IMPLIED OR STATUTORY, INCLUDING IMPLIED WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE, OR PERFORMANCE OR APPLICATION. BY ACCEPTING PRODUCTS SOLD BY LOVATO USA, DISTRIBUTOR ACKNOWLEDGES THAT IT HAS EXAMINED THE PRODUCTS (OR SUBSTANTIALLY SIMILAR MODEL OR SAMPLE PRODUCTS) THAT ARE THE SUBJECT OF THIS AGREEMENT OR SUBSEQUENT CONTRACTS OF SALE AND UNDERSTANDS THAT THE PRODUCTS ARE SOLD AS IS, SUBJECT ONLY TO THIS LIMITED WARRANTY.

9. EXCLUSION OF DAMAGES: EXCEPT WHERE PROHIBITED BY LAW, LOVATO USA WILL IN NO EVENT BE LIABLE FOR INCIDENTAL, INDIRECT, SPECIAL, PUNITIVE, EXEMPLARY, OR CONSEQUENTIAL DAMAGES, OR ANY OTHER PECUNIARY OR OTHER LOSS WHATSOEVER OF ANY KIND, TO SPECIFICALLY INCLUDE LOST PROFITS, ARISING OUT OF OR IN ANY WAY CONNECTED WITH PRODUCTS SOLD BY IT. LOVATO USA’S MAXIMUM CUMULATIVE LIABILITY IS PURSUANT ONLY TO PARAGRAPH 7 AND WILL NOT EXCEED THE COST OF THE PRODUCTS SUBJECT TO WARRANTY. THE SOLE EXCEPTION TO THE FOREGOING EXCLUSION OF DAMAGES MAY OCCUR ONLY WHERE THE REMEDIES SET FORTH UNDER PARAGRAPH 7 FAIL; IN SUCH LIMITED SITUATIONS, LOVATO USA SHALL PROVIDE FOR “COVER” AND MAKE REASONABLE EFFORTS TO PROCURE OR ARRANGE SUBSTITUTE GOODS FOR DISTRIBUTOR.

10. CANCELLATIONS: Any order or partial order cancelled or suspended by Distributor is subject to express written consent of Lovato USA. Lovato USA may impose and Distributor hereby agrees to pay reasonable cancellation charges which reflect costs up to the time of cancellation or suspension.

11. GOVERNMENT REGULATIONS: No government contract regulations or clauses will apply to the Products or this agreement or act to bind Lovato USA unless specifically agreed to by Lovato USA in writing. Products sold hereunder are not intended to be used, nor should they be used, in any nuclear-related application either as a “Basic Component” under 10 CFR 21 (United States NRC) or otherwise under similar nuclear laws and regulations of this or any other country.

12. SEVERABILITY: If any provision of these Terms and Conditions is adjudicated to be invalid or unenforceable, such invalidity or unenforceability shall not affect any other provision of this Agreement which can be given effect without the invalid or unenforceable provision.