Purchase Order General Terms & Conditions

1.1 Delivery Conditions

1.1 Time is of the essence of PO, all items/services should be delivered according to details mentioned in delivery schedule in PO. Contractor shall not supply any items without a written PO.

1.2 In case of failure to deliver items per agreed schedules or any reasons including but not limited to, damaged and returned items a delay is caused in delivery, ITS may apply the following

a) liquidated damages at cost price for damaged units of the total value of PO for each day of delay up to a maximum of 20% of total PO value, or;

b) Immediate termination of PO by written notice without any obligation, financial or otherwise to compensate the Contractor.

c) In addition to above ITS shall have the right to purchase similar or substitute items from other suppliers at risk, cost & consequences of the Contractor, as deemed appropriate.

d) Upon termination of PO, Contractor shall immediately return all down payments/amounts paid by ITS in the same currency as paid by ITS.

e) ITS may take above actions in addition to other remedies per applicable laws.

2. Deliverables, Inspection and Acceptance Test

2.1 All items/services are subject to inspection & approval prior to acceptance by ITS.

2.2 Acceptance Tests shall be conducted against mutually accepted test procedures. An Acceptance Test Certificate shall be issued by ITS upon successful tests.

2.3 All items/services not according to specifications or warranties and/or shipped or performed contrary to instructions and/or in excess or short of ordered quantities and/or in nonconforming containers and/or alleged to violate any statute, ordinance, administrative order, rule, or regulation, may be fully or partially rejected or fully or partially returned or held at ITS's discretion at Contractors cost, risks and consequences.

2.4 ITS may charge Contractor for all expenses relating to inspection, unpacking, examining, repacking, storing and reshipping of any rejected goods, in addition thereof ITS may hold Contractor liable and claim for all damages arising from ant such breach or default.

2.5 Inspection carried or failure to carry such inspection or witnessing shall not be construed as acceptance of any part of the items or as relieving the Contractor of responsibilities for the items/services concerned complying with the requirements and being free from defects and capable of performing their respective functions.

2.6 If any item is found damaged, ITS at its discretion either deduct the value of the same from outstanding dues or may request full reimbursement of value thereof.

3. Invoices

3.1 All invoices should be submitted according to agreed payment schedule. Each invoice must provide details of items/services unit price, total price and PO numbers. Invoices without relevant PO reference numbers shall not be paid.

3.2 All correct and undisputed invoices shall be paid according to payment terms in PO. In case of a dispute or incorrect invoice payment will be made alter dispute is resolved.

3.3 ITS has the right to with hold payment, if delivered items/services are found to be defective, in such case until the same are replaced by Cor:tractor or ITS purchase the same from other supplier[s]. This condition is without prejudice to any other remedy that ITS has under this PO or law.

3.4 Contractor shall be responsible to pay all taxes, fees, VAT, franchise taxes, custom charges that are levied on its income under any jurisdiction and shall keep ITS fully indemnified in this respect.

4. Title and Risk of Loss

4.1 All Titles & Risks related to deliverables shall remain with Contractor until such deliverables are received and accepted by ITS.

4.2 For all the items rejected by ITS or returned to Contractor for repairs, the Contractor shall bear all risk of loss or damage after such notice of rejection or repair, until such items are redelivered to ITS or the subject issue is resolved.

4.3 All items delivered and services performed under a PO shall be free of all liens and attachments and if requested by ITS, a proper release of a!I liens and attachments or satisfactory evidence of freedom/release from liens will be delivered to ITS.

5. Termination of PO

5.1 ITS reserves the right to terminate this PO entirely or suspend performance any part thereof for its sole convenience , in such an event the Contractor shall immediately stop the work and shall immediately cause any of Contractor's suppliers or subcontractors to cease such work. In such an event Contractor shall be entitle to reasonable termination charges as ITS may determine consisting of a percentage of the order price reflecting the percentage of the work actually performed prior to the notice of termination, plus actual direct costs resulting from termination, if any.

5.2 Contractor shall not be paid for any work done after receipt of the notice of termination or for any costs incurred by Contractor or its suppliers or subcontractors which Contractor could have avoided.

5.3 ITS may terminate this Purchase Order or any part hereof in the event of Contractor's merger, bankruptcy or take over by a third party; and any default or breach by Contractor ; or if Contractor fails to comply with any of the terms and/or conditions of this PO, late deliveries or deliveries of defective items/services or which do not conform to PO and failure to provide ITS upon request if ITS deems it appropriate, with a specific future date of performance.

5.4 In the event of termination for cause, ITS shall not be liable to Contractor for any amount and Contractor shall return to ITS any amounts paid to Contractor by ITS and shall be liable to ITS for any and all damages sustained by reason of the default/breach which gave rise to the termination.

5.5 If it should be determined that ITS had erroneously terminated this PO for default, then such termination shall be deemed a termination for convenience.

6. Indemnity

Contractor shall keep ITS indemnified and hold harmless against:

a) all damages, claims or liabilities and expenses including resulting from defects in the items/services under PO, or from Contractor's act or omissions or of its employees or subcontractors; including any violation of regulation or Law or against any claim based on the death or bodily injury to any person, destruction or damage to property, or contamination of the environment and any associated clean up costs; or any claim based on negligence or wilful misconduct of Contractor or any of its subcontractor;

b) any claim by a third party against ITS alleging that the items or Services or processes provided under this PO infringe any intellectual property rights of a third party, whether such are provided alone or in combination with other products, software or processes, as well as for any alleged unfair competition resulting from similarity in design, trademark k or appearance of goods or service-furnished hereunder;

c) Should ITS use, or use by its distributors, subcontractors or customers, of any items or Services purchased from Contractor be enjoined, be threatened by injunction, or be the subject of any legal proceeding, Contractor shall, at its sole cost and expense, either (a) substitute fully equivalent non infringing items or Services; (b) modify the items or Services so that they no longer infringe but remain fully equivalent in functionality; (c) obtain for ITS, its distributors, subcontractors or customers the right to continue using the items or Services; or (d) if none of the foregoing is possible, refund all amounts paid for the infringing items or Services.

d) This indemnification is in addition to the warranty obligations stated herein.

e) Contractor shall not settle any suit or claim without ITS prior written approval. Contractor shall reimburse all costs that may be incurred by ITS in enforcing this indemnity, including legal expenses.

7 Warranties

Contractor hereby expressly warrants:

a) That all deliverables conform to agreed specifications and are fit and sucient for the intended purpose herein, and free from defects .

b) Inspection, test acceptance or use of the goods by ITS shall not aect Contractor's obligations under this warranty and such warranty shall survive inspection, test acceptance and use.

c) Upon notification of any non-conformity, Contractor shall promptly correct defects or replace any items without any expense or claim to ITS or ITS may after notice to Contractor obtain such corrections or replacements directly from a third party of its choice at Contractor's expense.

d) Contractor warrants and confirm availability of all relevant spare parts and labor for at least 10 years from the date of delivery. If Contractor fails to confirm or do so, then ITS shall have the right to reject items/services and to buy replacement through other sources at Contractor cost and responsibility.

e) Contractor warrants that it is legally authorized to supply items/services under this PO and holds all rights thereof and have capacity to transfer all legal rights to ITS and its actions under the PO do not and shall not violate any law or rules under any jurisdictions.

8. Advertising

Contractor will not publicly disclose the existence or terms of this PO or Contractor's business relationship with ITS without prior written permission of ITS.

9. Applicable Law

This PO shall be governed by the Laws of State of Kuwait. In case of any dispute related to interpretation, performance, or breach of this Purchase Order terms the Parties shall mutually attempt to settlement the same. If parties fail to resolve such dispute within thirty (30) days, then the same shall be settled according to Arbitration rules of Kuwait Chamber of Commerce rules in Kuwait.


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