Terms & Conditions.

1. ENTIRE CONTRACT; Waiver, Remedies; Assignment and Subcontracting - These Terms and Conditions and Seller quotation constitute the entire contract between Buyer and Seller (KenWalt Die Casting Corporation, also referred to as KenWalt) with respect to the subject matter hereof, transcending any oral arrangements, representations, purchase order or terms and conditions of Buyer which may be inconsistent therewith. Unless otherwise agreed upon by Seller, quotations furnished by Seller are not intended as and shall not be construed as constituting an offer to Buyer. KenWalt's quotation and Terms and Conditions take precedence over any verbal or written contract, term, condition, order, representation, understanding, Buyer terms and conditions, or other like agreement between KenWalt and Buyer. In addition, all other verbal or written contract, term, condition, order, representation, understanding, terms and conditions, or other like agreement between KenWalt and Buyer are hereby deemed null and void. There are no other verbal or written contracts or other like agreements different than herein stated. Exceptions to any of KenWalt's quotation or Terms and Conditions as specified herein or to any supplements will not be considered as binding upon KenWalt. These contractual Terms and Conditions shall be effective and binding upon KenWalt and Buyer upon Buyer acceptance of KenWalt quotation, good or service. A KenWalt quotation is valid for thirty (30) days from the quotation date, is based on current material and labor costs, is subject to applicable taxes, and is subject to change at any time for any reason and without notice by KenWalt. A KenWalt quotation and Terms and Conditions shall supersede and prevail over any conflict with a Buyer's order or terms and conditions. Acceptance by KenWalt of any Buyer order shall have no binding effect whatsoever on KenWalt. This contract shall be construed according to the laws of the State of California.

2. AMENDMENT - No change or modification of KenWalt's quotation or Terms and Conditions shall be binding upon KenWalt, except as evidenced by written approval by an authorized KenWalt officer. KenWalt shall have the right to make changes in contract, quotation, price, drawing, design, plan, specification, time and place of delivery, or method of transportation, and Buyer shall comply with such change immediately upon verbal or written notification thereof. If any such change causes an increase or decrease in costs or prices, an equitable adjustment may be made by KenWalt and shall become effective immediately upon such notification.

3. PREFERRED/SECURED CREDITOR - Buyer hereby agrees and assigns KenWalt as a Preferred Creditor and thus giving KenWalt first claim to any available funds. Additionally, Buyer hereby agrees and assigns KenWalt as a Secured Creditor who thereafter has a lien on the property of the Seller and has the right to repossess or foreclose on the property or assets against which a lien is held when Seller is in default.

4. PRICES - All goods are billed at Seller's quoted prices, plus metal cost adjustments and applicable taxes. All prior quoted prices are subject to change without notice. Buyer shall accept Seller's certification of prices applicable on each shipment until the order is completed. Seller reserves the right to adjust part prices to reflect actual costs at time of shipment. KenWalt quotations are based on metal costs at the time of quotation. Unless a KenWalt quotation states a fixed metal cost was used, a metal cost adjustment increase or decrease will be invoiced to Buyer. Buyer agrees to pay such metal cost adjustments as invoiced.

5. TAXES - In addition to the prices stated herein, Buyer shall reimburse Seller for all taxes, excises, fees, or other charges which Seller may be required to pay to any government (National, State or Local) upon the sale, use, production or transportation of the goods, including tooling, sold hereunder. All applicable Federal, State, City, Local, Excise, Use, Sales, Value-added, Personal Property or any other applicable taxes, as well as storage, tariff, import/export, or any other fees, are due and payable by the Buyer as required by law. Buyers exempt from tooling or die casting taxes must promptly submit a valid Reseller's Permit or Resale Certificate to KenWalt prior to or concurrent with order placement to be considered for exemption from applicable taxes.

6. DELIVERY - Delivery dates are estimates only. Time is not of the essence and when time of delivery is given it shall be deemed to be estimated only and Seller shall not be held responsible or liable for failure to meet such dates. Estimates of delivery are subject to revision when complete ordering information is received by Seller. There shall be no liability for failure or delay of delivery due to acts of God, acts of Buyer, Government action, accident, casualty, fire, flood, war, strike, labor trouble or shortage, inability to obtain materials or supplies, equipment failure, power failure, delay or interruption of carriers, transportation issues, tool defects, or other causes beyond the reasonable control of Seller. Upon any such delay or failure, the delivery date shall be extended or the items affected may be eliminated from the order (except as provided in paragraph 18). KenWalt will make an effort to deliver Buyer goods by specified dates. However, KenWalt shall not be held responsible or liable for any Buyer damages or losses sustained as a result of late, delayed or failed deliveries.

7. SHIPMENTS - F.O.B. Seller's plant or other point of shipment. Title and risk of loss or damage passes to Buyer on delivery to carrier. Seller may ship all the goods at one time or in portions from time to time. Unless otherwise specified on Seller's quotation, shipments will be made using bulk containers/cartons at Seller's discretion. Buyer agrees to pay for special containers/cartons and any special shipping costs, including but not limited to, expedited shipping costs. Goods are packaged to protect against damage during shipment, however Seller has no control of goods and is not liable for any damage or loss of goods upon delivery to carrier.

8. ENGINEERING, DESIGN, INFORMATION DISCLAIMER - Buyer is solely responsible and liable for the engineering and design of Buyer's part. KenWalt disclaims any responsibility or liability for KenWalt furnished information of any kind, including but not limited to, engineering, design, changes, techniques, methods, or otherwise, and use thereof by Buyer shall be at Buyer's risk, and KenWalt shall not be held liable as a result of such use.

9. WARRANTY, GUARANTEE - THERE IS NO WARRANTY OR GUARANTEE, EXPRESSED OR IMPLIED, INCLUDING ANY IMPLIED WARRANTY OR GUARANTEE OF MERCHANTABILITY OR FITNESS FOR PARTICULAR PURPOSE OR USE OR WORKMANSHIP, PERFORMANCE, QUALITY, DURABILITY, OR OTHERWISE, ON THE PRODUCTS, OR ON ANY LABOR FURNISHED DURING THE SALE, DELIVERY, OR SERVICING OF THE PRODUCTS, EXCEPT AS EXPRESSLY SET FORTH HEREIN. Buyer warrants the title, design, properties, fit, form and function, soundness both surface and subsurface, merchantability, fitness for particular purpose or use or otherwise, and on any labor furnished during the sale, delivery, or servicing of the products. Seller agrees at our option to repair, replace, or issue credit, including metal credit only, for defective die castings provided Buyer delivers written notice to Seller within ten (10) days after the invoice date and provided that the goods have not been processed or otherwise used in any manner and samples of the claimed defective castings are returned to our factory properly packaged and identified for inspection and found defective by us. No warranty or guarantee attaches to die castings altered, machined, finished or otherwise used or modified after delivery by us. KenWalt is supplying casting products to you, from your molds to your specifications of design, quality standards, and choice of material, KenWalt is prevented from making changes to your specifications without your prior written notice. Even though samples or information as to observed properties of the goods may have been supplied to Buyer, Seller does not warrant or guarantee the conformity of the goods to the samples or the observed properties. When differences between models and drawings exist, the Seller shall conform to specifications of the model or to Buyer's written instructions. It is understood that our option to repair, replace, or issue credit, including metal credit only, is the exclusive remedy and our liability is limited to the invoice price of the castings proved defective. Seller shall not under any circumstances be liable for any special or consequential damages. The Buyer assumes risk of loss through fire, forcible entry, earthquake or casualty, of tooling, parts, inserts, or other property left in Seller's premises. When Buyer's orders contain written, printed or stamped provisions conflicting with the written, printed or stamped provisions of KenWalt's quotation or Terms and Conditions, KenWalt's quotation and Terms and Conditions will prevail. The foregoing expresses the entire liability of Seller regarding the tools and goods.

10. INDEMNITY - Buyer agrees to indemnify, defend, and hold harmless KenWalt, its owners, successor, employees, assigns, agents and users of loss, damage, liability, including costs and expenses which may be incurred on account of any suit, claim, judgment or demand involving KenWalt, including produced material and/or parts, including but not limited to infringement or alleged infringement of any patent, trademark, invention, copyright rights, in the manufacture, use or disposition of any material and/or parts supplied or service provided by KenWalt to Buyer and pursuant to its users.

11. PATENTS - Buyer assumes responsibility and liability for any patent, trademark, invention or copyright infringement. Buyer agrees to indemnify and hold harmless KenWalt of any damages, losses or liabilities that may occur. Buyer shall pay all losses, including but not limited to, legal fees, litigation, negotiation, judgment, settlement, or royalty, to defend KenWalt if a conflict arises. It is the sole responsibility of the Buyer to provide license for Seller to produce Buyer's part or any patented design. Buyer shall defend Seller against any suit or proceeding brought against Seller related to any claim that any goods furnished under this contract constitute an infringement of any patent, trademark, invention or copyright of the United States or any other country. Buyer shall promptly notify Seller in writing and give authority, information and assistance (at Buyer's expense) for the defense of Seller and Buyer shall pay all damages and costs awarded therein against Buyer or Seller, and Seller shall have no responsibility to defend any such suit or proceeding or to pay any costs, including but not limited to, legal fees, court costs, award, royalty, or damages, including if the infringement claim arises out of or relates to any action, inaction or omission of Buyer. In case said goods are in any such suit held to constitute infringing goods and the use or resale thereof is enjoined, Buyer is nonetheless obligated to pay Seller for the goods received. The foregoing states the entire liability of Seller for patent infringement by said goods. No patent license is granted or implied by Seller and no warranty is given by Seller against infringement of the patents of others by reason of the use of the goods in combination with other goods or in the operation of any process. In all events, Buyer shall save Seller harmless from infringement of patents arising from compliance with Buyer's designs or instructions. Patent rights to all improvements embodied in designs, gating, tooling, apparatus, fixtures, drawing information and equipment made by KenWalt under an order contract, and exclusive rights for the use and reproduction thereof, are the sole property of KenWalt.

12. QUANTITY - Because of conditions existing in manufacturing the goods, Seller reserves the right to ship and bill ten percent (10%) more or less than order quantity(s) and Buyer shall accept and pay for all goods actually shipped within such allowances. Buyer agrees that Seller is not liable for any underage. No claims for shortages in count or weight will be allowed unless reported to Seller within ten (10) days after the invoice date. No goods shall be returned to Seller for any reason without Seller's prior authorization.

13. ALLOY, MACHINING, FINISH - Castings will be furnished from the material specified in KenWalt quotation. Finish as a result of surface condition of tooling and die lubrication during production. Unless otherwise specified in KenWalt's quotation, finishing operations such as trimming, machining, deburring, drilling, tapping, reaming, assembly, etc., or buffing, polishing, anodizing, painting, plating, etc, are not included.

14. TOOL CHARGES - (a) Where special tooling or other manufacturing or production apparatus is required and specifically paid for by Buyer, one-half of the quoted tool charge must be paid with the placing of the original order for such tool or apparatus, and the balance not later than ten (10) days after the receipt of the first samples. Upon payment in full therefore any such tools or other apparatus shall become the property of the Buyer, but may not be removed from possession of Seller (or it's designee) until an additional engineering charge of 30% of original charge is paid by Buyer. It is understood that the Seller's charge for new dies may consist of complete die blocks with cavities, or may consist of die inserts with cavities for use in Seller's common master unit dies. Seller's common tooling may consist of mold bases, unit bases, ejector pins, ejector plates, trim die bases and such cores or slides as may be necessary. Seller's common tooling is not sold and does not become property of Buyer, as these items are a part of Seller's die casting machinery and are interchangeable with numerous other tooling which Seller operates. Where any such tooling or other apparatus, including gating design, incorporates trade secrets of Seller, such tooling, apparatus or gating design may never be removed from Seller's (or its' designee's) premises but will be kept for the exclusive use of Buyer. (b) Seller's tools, other apparatus and gating design shall not be removed from Seller's plant. In the event of Buyer's tool removal, Buyer shall accept same "as is" F.O.B. Seller's plant and reimburse Seller for any packing or other charges incurred. Seller reserves the right to hold up return of tools and such other apparatus until Buyer pays any amount due Seller and, in that regard, Buyer grants to Seller a security interest in all of Buyer's right, title and interest in and to (i) any such tools, equipment or other apparatus now or at any time hereafter delivered to Seller by or on behalf of Buyer and (ii) any and all products (including the goods to be shipped hereunder) and proceeds of the foregoing, to secure payment and performance of all of Buyer's obligations hereunder and under any and all other invoices or other documents, agreements and instruments between Buyer and Seller. Buyer shall execute and deliver to Seller all UCC financing statements reasonably requested by Seller in connection with the foregoing grant of a security interest in tools, equipment, apparatus and the products and proceeds thereof. Seller will for a period of two (2) years after completion of Buyer's most recent production order, maintain all tools and other apparatus still in its possession pertaining to said order in condition to furnish molded pieces, subject to due allowance for ordinary wear and tear and casualty. Buyer is responsible for repair or rework of all Buyer tools that are heat checked or worn as a result of usage, part design or shot cycles. Buyer agrees to indemnify Seller and hold Seller harmless for any costs associated with failure or pre-mature failure of all tooling provided by Seller for the production of Buyer's products. Two (2) years after completion of Buyer's most recent production order, Seller reserves the right and Buyer consents such tools and other apparatus, including parts, shall become the sole property of Seller for all purposes and Seller may thereafter use, sell, or dispose of such tools and other apparatus, including parts made therefrom, after giving thirty (30) days written notice thereof to the Buyer at their last known address, and Buyer agrees to defend, hold harmless, and reimburse Seller against any loss or damage resulting from infringement of any patent, trademark, copyright or invention as a result thereof. Anything contained herein to the contrary notwithstanding, it is specifically understood and agreed that Seller shall not be liable to Buyer or any other person, firm, corporation, or entity, for the loss, damage, destruction or disappearance of any tools or other apparatus left in Seller's (or it's designee's) possession and/or control, and in the event of such loss, damage, destruction or disappearance, Buyer and/or any other person, firm, corporation, or entity, shall have no claim therefore against Seller whatsoever.

15. TOOL MAINTENANCE, REPAIR, REPLACEMENT - Seller to assume general maintenance only (i.e. core pins, ejector pins). If a tool requires repair for anything other than general maintenance, Seller reserves the right to charge back Buyer for such costs. A tool will become less productive compared to when new, which affects quoted rates and prices. Worn out tools cause slow production rates, quality problems, increased scrap, increased inspections and sorting costs, overtime and consume more than standard production capacity. Buyer delay authorizing a repair or replacement tool may result in increased or additional costs to Buyer.

16. GAUGES AND QUALITY EQUIPMENT - If Buyer uses special gauging to determine the acceptability of goods, Seller shall receive from Buyer duplicate special gauging, preferably made at the same time by the same vendor the Buyer used.

17. BUYER SUPPLIED ITEMS - Materials, inserts or component parts supplied by Buyer must be furnished in a quantity or amount reasonably in excess of that required to fill an order and must be delivered F.O.B. the Seller's plant. As a certain amount of spoilage is unavoidable, such items should be supplied in quantities ten percent (10%) or greater than the number of parts ordered. Buyer is liable and responsible for quality, timely delivery, design, fitness for use, merchantability and maintaining sufficient inventory. Seller will have no liability or responsibility for damage or defects to tools, castings, parts or other goods, nor for other consequential damages, caused by Buyer supplied items. Buyer supplied items received by us are not subject to inspection or count, and if they are defective we assume no liability or responsibility for parts made with such defective items and such parts are not subject to rejection by you, including but not limited to, reasons of excessive fins, flash, inaccuracy, or imperfections caused by such inserts. Buyer supplied items are to be stored and handled at your risk. We assume no responsibility for losses, or spoilage in production, other than fair and reasonable care. Production losses caused by shortage of Buyer supplied items are to be paid for by Buyer. To avoid such losses, Seller may not set up for production until all such items are in our plant.

18. CHANGES AND CANCELLATION - Orders accepted by Seller are not subject to changes or cancellation by Buyer, except by Seller's written consent. If this sale covers goods that must be manufactured especially for Buyer and such change or cancellation is made, Buyer shall take all completed goods at full price and all goods in process at cost plus pro-rata profit and Buyer shall reimburse Seller for any loss on materials purchased or on contract for the filling of the order. Any order change must be approved in writing by an authorized KenWalt officer. Verbal changes are unacceptable. KenWalt reserves the right to cancel or terminate an order or any part thereof at any time for any reason.

19. ASSIGNMENT AND SUBCONTRACTING - Order may not be assigned or subcontracted in whole or in part, nor may any assignment of any monies due or to become due be made by Buyer without in each case prior written consent by an authorized KenWalt officer, and no such assignment or subcontract without such written consent shall be binding upon KenWalt. Payment to any approved assignee of any claim under an order shall be subject to setoff or recoupment for any existing or future claim(s) that KenWalt may have against Buyer.

20. ERRORS - Stenographic and clerical errors are subject to correction. KenWalt reserves the right to correct any such errors, at any time, and such corrections do not change the meaning of this contract.

21. LAWS - Any domestic or international contractual or legal dispute or controversy shall be settled outside the courts by arbitration under rules of the American Arbitration Association in Los Angeles in the State of California. In no case, shall Seller's liability be in excess of the dollar value of the die castings received by the Buyer during the thirty (30) days prior to the last delivery of die castings ordered under this contract.

22. TERMS OF PAYMENT - Buyer hereby agrees that Seller has a lien on any Buyer tool, mold, insert, apparatus, component, material, part, merchandise and goods in our possession. The terms of payment on Seller's quotation are subject to change at any time for any reason and without notice at the discretion of Seller. Past due invoices are subject to a service charge of 1-1/2% per month (18% per annum) or the maximum allowed by law. Buyer agrees to pay all Seller's collection costs incurred upon demand.

23. BANKRUPTCY/INSOLVENCY - In the event that Buyer files for any protection from creditors, including but not limited to, bankruptcy or insolvency, Buyer shall immediately, and prior to such filing, deposit in an escrow account all funds due Seller, and immediately following such deposit in an escrow account all funds due Seller, pay all such funds to Seller.

24. ATTORNEYS' FEES - Buyer promises to pay all costs and expenses of Seller and its successors and assigns incurred in connection with the collection of Buyer's obligations hereunder or in the enforcement or attempted enforcement of any of Seller's rights hereunder, including but not limited to, attorneys' fees, disbursements, and collection costs, whether or not an action is filed in connection therewith.

25. REMEDIES - The remedies herein reserved shall be cumulative and additional to any other or further remedies provided by law or equity. No waiver of a breach of any provision of this contract shall constitute a waiver of any other breach of such provision.

26. COMMISSION OF GRATUITY - Buyer warrants that it has not directly or indirectly paid or promised to pay any commission, fee or consideration, nor made or promised to make any gift or gratuity to any agent or employee of KenWalt for the purpose of securing a contract with KenWalt.1

27. PROMOTION - Seller reserves the right to use photos, sketches and other representations of Buyer tooling and products for the purposes of advertising, marketing or promotion. Buyer shall not advertise or publish in any manner the fact that Buyer has contracted Seller to furnish Buyer products or services without first obtaining written authorization by an authorized KenWalt officer.

28. MISCELLANEOUS - To the extent otherwise not provided above, NADCA Product Specification Standards for die castings shall prevail over all other specifications. Gauges which may be required for inspection of Buyer part, other than standard calipers or pin gages we may have available, are to be supplied by and paid for by Seller.

29. EFFECTS OF INVALIDITY - The invalidity in whole or in part of any provision, term or condition shall not affect the validity of any other provision, term or condition. If any part of quotation or Terms and Conditions is held to be invalid, illegal or otherwise unenforceable, then such provision shall be deemed modified to the extent necessary to make such provision enforceable, or, if not practicable, then deleted. The unenforceability of any portion of the quotation or Terms and Conditions shall not impair or affect the validity and enforceability of the remainder. Either party's failure to insist upon full performance of any provision, term, condition or specification hereof or to exercise any rights or remedies hereunder of any of the provisions, terms, conditions or specifications hereof or to exercise any rights or remedies hereunder shall not thereafter be deemed a waiver of the same or of any other provisions or privileges hereunder. The individual remedies reserved in the quotation and Terms and Conditions shall be cumulative and in addition to any other or further remedies provided at law or in equity. Buyer shall not assign or subcontract, in whole or in part, its rights or obligations under the quotation and Terms and Conditions without prior written authorization by an authorized KenWalt officer.