(1) ACCEPTANCE–This purchase order constitutes Buyer’s offer to Seller, and is a binding contract on the terms and conditions set forth herein, when it is accepted by Seller either by signature on the acknowledgment copy or the commencement of performance hereunder. No condition stated by Seller in accepting or acknowledging this order shall be binding upon Buyer if in conflict with, inconsistent with, or in addition to the terms and conditions herein unless accepted by Buyer in writing.

(2) REVISIONS–No revisions of this order or any of the terms or conditions hereof shall be valid unless in writing and signed by an authorized representative of Buyer's Purchase Department.

(3) CHANGES-Buyer may at any time by written order, without notice to any surety, make changes or additions within the general scope of this purchase order in or to drawings, designs, specifications, instructions for work, method of shipment or packing, or place of delivery. If any such change causes an increase or decrease in the cost of, or the time required for, performance of this purchase order, Seller shall notify Buyer in writing immediately and an appropriate equitable adjustment will be made in the price or time of performance, or both, by written modification of this purchase order. Any claim by Seller for such adjustment must be submitted within thirty days or sooner if requested after Seller’s receipt of the change. Nothing herein shall excuse Seller from proceeding with the contract as changed.

(4) QUANTITY–Buyer need not accept any variation in quantity except as specified herein.

(5) PACKING AND SHIPMENT–Deliveries shall be made as specified, without additional charge for boxing, crating, carting or storage. Unless otherwise specified, an article should be suitably packed to secure the lowest transportation cost in accordance with the requirements of common carriers. Material shall be described in bills of lading in accordance with current national mode of freight or uniform freight classification, whichever is applicable. Buyer’s order numbers and symbols, and identification numbers must be plainly marked on all invoices, packages, bills of lading and shipping orders. Packing lists shall accompany each box or package shipment showing Buyer’s order number and symbol, item number and description materials. Buyer's count or weight shall be final and conclusive on shipments not accompanied by packing lists. Shipping receipts or bills of lading shall be sent to Buyer on date material is shipped. Articles shall be packed to assure against damage from weather or transportation.

(6) DELIVERY–Time is of the essence. Delivery shall be strictly in accordance with the delivery schedule set out or referred to in this order. If Seller has reason to believe that deliveries will not be made as required, written notice setting forth the cause of any anticipated delay shall be given immediately to Buyer, in which event Buyer may withdraw this order.

(7) INVOICING–Invoices shall be mailed immediately after each shipment to Ontario Knife Company, Accounting Department, at the address shown on the face of this purchase order. Delays in receiving invoices, errors or omissions on invoice, or lack of supporting documentation required by the terms of this order will be cause for withholding settlement without losing discount privileges.

(8) PAYMENT–Payment for the articles covered by this purchase order will be made promptly following receipt of such articles at destination and appropriate invoice, subject to adjustment for shortage and/or rejection.

(9) INSPECTION–If a specification number is noted for the articles ordered, Seller shall, upon request, furnish a notarized report confirming manufacture of the articles according to specification.

All articles will be subject to final inspection and acceptance by Buyer within a reasonable time after receipt at the designated destination, irrespective of prior payment. Payment shall not constitute acceptance.

Buyer may reject any article which contains defective material or workmanship or does not conform to specifications, samples or warranties. Any articles so rejected may be returned to Seller at Seller’s risk and expense, and at full invoice price plus applicable transportation charges both ways. No defective article or material shall be replaced unless requested by Buyer in writing.

(10) WARRANTY–Seller warrants that all articles, materials and work furnished hereunder will be free from defect in material and workmanship and will conform to applicable specifications, drawings, samples and/or descriptions furnished by Buyer. The warranties of Seller, together with its service guarantees, shall run to Buyer and/or its customers.

(11) INDEMNITY–Seller agrees to indemnify Buyer and its customers against any liability, including cost and expenses for or by reason of any actual or alleged infringement of any patent, copyright, or trademark arising out of the manufacture, use, sale or disposal of supplies or articles furnished to Buyer under this purchase order. Buyer shall give Seller prompt notice in writing of any action suit alleging such liability.

(12) SUB-CONTRACTING–Seller agrees to obtain Buyer's written prior approval before subcontracting this order or any substantial portion thereof; provided however, that this limitation shall not apply to the purchase of standard commercial supplies or raw materials on which Seller will perform further work.

(13) ASSIGNMENT–On acceptance. Seller may not assign the contract evidenced hereby, or any obligation, right or interest herein, including but not limited to any monies due hereunder, without the prior written permission of the Buyer, any attempted assignment in violation of this provision shall be void. Any permitted assignment shall provide that payment to an assignee of any such claim shall be subject to the terms and conditions of this contract, to Buyer’s right of set off or recoupment for any past, present, or future claim(s) which Buyer may have against Seller, in addition to such terms and conditions as Buyer may reasonably request. Any permitted assignment shall be valid only after Seller has supplied Buyer with two properly executed copies of the assignment.

(14) TERMINATION–Without limiting Buyer’s right to cancel this purchase order for default of Seller, as provided below, Buyer may terminate all or any part of the work under this order and process claims therefore, for its convenience in accordance with the provisions set forth in FAR 49.502, which is hereby incorporated by reference.

(15) DEFAULT OF SELLER–Buyer reserves the right to cancel all or any part of the undelivered portion of this purchase order in the event Seller for any reason fails to perform any of the provisions of this purchase order, including specified times for delivery, or fails to make progress so as to endanger performance of this purchase order in accordance with its terms. Buyer shall also have the right to cancel this order or any part thereof if Seller becomes insolvent, makes any assignment for the benefit of creditors, or a bankruptcy petition if filed which is not vacated within thirty days from the date of filing. Except with respect to defaults of its subcontractors, Seller shall not be liable for damages if the failure to perform this purchase order arises out of causes beyond the control and without fault or negligence of Seller, such as acts of God or of the public enemy, fires, floods, strikes, freight embargoes, or acts of the Government in either its sovereign or contractual capacity; but in every case the failure to perform must be beyond the control and without the fault or negligence of Seller. If the failure to perform is caused by the default of a subcontractor, and if such default arises out of causes beyond the control of both Seller and the subcontractor, and without the fault or negligence of either of them, Seller shall not be liable for damages suffered by Buyer. If after notice of cancellation under the provisions of this article, it is determined that such cancellation was not in accordance with the terms of the purchase order, such notice of cancellation shall be deemed to have been issued pursuant to Article 14 entitled “TERMINATION,” and the rights and obligations of the parties hereto shall in that event be governed by such articles.

The failure of Buyer to insist upon strict performance of any of the terms of this purchase order or to exercise any rights herein conferred, shall not be construed as a waiver of any terms and conditions herein, and Seller's obligations with respect to any different or future performance shall continue in full force and effect.

(16) BUYER FURNISHED PROPERTY–All drawings, data, tooling, articles, material and information furnished by Buyer to Seller including propriety rights therein and copies made therefrom shall not be used in any manner and for any purpose other than for work to be performed for Buyer. Seller assumes complete liability for said items spoiled by it or not otherwise accounted for to Buyer’s satisfaction. Said items including copies or reprints thereof shall be promptly returned to Buyer upon completion of this work. Said items or copies thereof shall not be made available to other persons without Buyer’s prior written consent, and if Buyer so consents, Seller agrees to place similar restrictions on them and insure their return to Buyer. The furnishing of said items shall not be construed to vest in Seller or others any interest therein or title thereto, but same shall remain the exclusive property of Buyer. Where no government contract number is shown on the face of this purchase order and where payment is made for experimental, developmental or research work performed hereunder, Seller shall disclose and does hereby assign to Buyer all inventions resulting therefrom and does grant Buyer the right to use for any purpose all data specified to be delivered under this purchase order.

If any Government property, including but not limited to materials and/or special tooling is furnished to the Seller in connection with this purchase order, the appropriate provisions of FAR 45.1 through 45.309, shall be applicable to and form a part of this purchase order.

(17) SPECIAL TOOLING–Dies, tools and patterns specially developed for and used in the manufacture of the articles herein ordered shall be furnished by and at the expense of Seller and shall be kept in good condition and, when necessary, shall be replaced by Seller without expense to Buyer.

Buyer may at any time become the owner and entitled to possession of any or all such special tooling acquired or manufactured specially for use in the performance of this order if any portion of the cost of such special tooling is separately stated or included in the price of articles, material or work covered by this order upon Seller being reimbursed the unpaid amount of Seller’s cost of such special tooling.

If the price stated on the face hereof includes separately the entire cost of any such dies, tools and/or patterns acquired by Seller for the purpose of filling this order, such dies, tools and/or patterns shall become the property of the Buyer. To the extent feasible, Seller shall identify said property as Buyer directs and shall retain such property for exclusive use of Buyer. At completion of this order such tools, dies and/or patterns shall be stored for a reasonable time by Seller at no cost to Buyer, and until disposed of as Buyer may direct.

(18) INSURANCE–Seller agrees, if and when requested by Buyer, to procure a policy or policies of insurance in form satisfactory to Buyer insuring all property on Seller’s premises owned by Buyer against loss or damage resulting from fire including extended coverage, malicious mischief and vandalism. Satisfactory evidence of such insurance shall be submitted to Buyer within a reasonable period of time after requested by Buyer.

(19) INDEMNITY–If Seller, in connection with the performance of this purchase order, shall send any of its agents or employees onto premises owned or controlled by Buyer, Seller shall (1) provide safety protection for persons and property in accordance with all applicable laws and regulations, and (2) indemnify and save harmless Buyer from and against any and all liabilities and losses whatsoever (including without limitation cost and expenses in connection therewith) on account or by reason of injury to or death of any person whatsoever or loss of or damage to any property whatsoever suffered or sustained in the course of or in connection with the performance of the work. Buyer at its option may require Seller to furnish evidence of insurance reasonably satisfactory to Buyer covering the liabilities and indemnifications provided above, but no acceptance of such evidence by Buyer shall be deemed a waiver or release of such liabilities or duty to indemnify.

(20) SECURITY REGULATIONS–Seller agrees that, if required, prior military security clearance will be obtained by any of its personnel requiring access to Buyer’s plant premises for the purpose of performing the work covered by this purchase order.

(21) COMPLIANCE WITH LAWS AND REGULATIONS–Seller agrees that the articles will be produced and all work hereunder will be performed in accordance with all applicable statutes and laws (including the Fair Labor Standards Act and all lawful orders, rules and regulations thereunder), executive orders, regulations, of any of the executive departments of the United States Government, or any state or political subdivision thereof, and agrees to indemnify Buyer against any loss, cost, liability, or damage by reason of Seller’s violation of any such applicable laws, orders, rules or regulations.

(22) EMPLOYMENT OF ALIENS–No aliens employed by Seller shall be permitted to have access to the plans or specifications, or the work under construction, or to participate in any testing or inspection thereof, or to have access to any information pertaining to any of the foregoing, without the prior written consent of the Buyer.

(23) ADDITIONAL PROVISIONS– The following paragraphs of the Federal Acquisition Regulations (FAR) and clauses referred to herein are made part of the terms and conditions of this purchase order, if applicable: Prohibited Sources (25.7); Convict Labor (22.2); Contract Work Hours and Safety Standards Act (22.3); Equal Employment Opportunity (22.8); Covenant Against Contingent Fees (52.203-5); Authorization and Consent (27.201); Notice and Assistance (27.202); Buy American Act -- Construction Materials (25.2); Prohibition of Segregated Facilities (52.222-21); Classified Contracts (27.207); Patent Rights Under Government Contracts (27.3); Reporting of Royalties -- Anticipated or Paid (27.204); Utilization of Small Business Concerns (52.219-8); Gratuities (52.203-3); Defense Priority and Allocation Requirements (52.211-15); Higher-Level Contract Quality Requirement (52.246-11); Audit and Records -- Sealed Bidding (52.214-26); Subcontractor Cost or Pricing Data -- Modifications -- Sealed Bidding (52.214.28); Walsh-Healey Public Contracts Act (52.222-20 and 22.6). In addition, where any of the foregoing provisions of the FAR relate to specific statutes, and are in furtherance of the provisions of such statutes, such statutes shall also be applicable to the extent required.

Where necessary to make the context of all above regulations applicable to this order, the term “Government” or “Contracting Officer,” and equivalent phrases shall mean the Buyer and the term “Contractor” shall mean the Seller hereunder, and the terms “Contract” shall mean this purchase order.

(24) INTERPRETATION–The interpretation of this purchase order shall be governed in all respects by the laws of the state which is shown as part of the address of Ontario Knife Company on the upper portion of the face of this purchase order.