Tml Purchasing Terms and Conditions (June 2010 Edition)

The contract between Tml Precision Engineering Ltd. (“Tml”) and the Supplier (“Agreement”) consists of the following:

(a) one or more Orders and any schedule(s) to an Order;

(b) these Purchasing Terms and Conditions; and

If there is any conflict or inconsistency between any of the above, they shall have the following order of precedence: first, the Order and its schedules, second, these Purchasing Terms and Conditions and third, any documents as set out in paragraph (c) above.

This Agreement constitutes the entire legal and contractual relationship between the parties relating to the subject matter of this Agreement and, except in the case of any fraudulent misrepresentation made by either party in connection with the subject matter of this Agreement, terminates, cancels and supersedes all prior or contemporaneous agreements or representations, written or oral, with respect to this Agreement and its subject matter.

1.0 Definitions

1.1 In this Agreement unless the context otherwise requires:

“Charges” means the charges for the Supplies.

"Confidential Information" means the terms of this Agreement and information disclosed by one party ("Disclosing Party") to the other ("Receiving Party") to the extent that such information is designated as such by the Disclosing Party in writing or relates to the business affairs, developments, trade secrets, know-how, personnel, customers or suppliers of the Disclosing Party or that such information may reasonably be regarded as the confidential information of the Disclosing Party.

“Delivery Date” means the date for delivery of the Supplies as set out in the Order or agreed between the parties in writing.

“Intellectual Property Rights” means any patents, trade marks, service marks, registered designs, applications for any of the foregoing, copyright, design rights, database rights, know-how, confidential information, trade and business names and any other similar protected rights in any country.

“Order” means Tml’s purchase order document that states (i) the Supplies to be provided by the Supplier; (ii) Tml’s purchase order number; and (iii) it is subject to these Purchasing Terms and Conditions.

“Products” means any equipment and/or Programs set out in the Order.

“Product Description” means the description of the Supplies set out in the applicable Order and in the product, software and/or service description published (including electronically) by the Supplier or manufacturer at the time that the Order is placed.

“Services” means any services described in the Order.

“Supplier” means the person to whom the Order is addressed and "person" includes partnerships, bodies corporate, corporations, associations, and government bodies and/or departments.

“Supplies” means the Products or Services described in the Order.

“Warranty Period” means in respect of Products twelve (12) months after the Delivery Date, and in relation to Services, ninety (90) days after the date of completion of the Services.

2.0 Health and Safety

The Supplier shall comply with all relevant health and safety legislation. It will ensure Supplies that are potentially dangerous to health or safety are delivered in suitable protective packing and that the external surface of such packing is clearly labelled to indicate any such hazards involved in handling and using the Supplies and the method of safe handling. A copy of any information relating to the safety aspects or proper use of the Supplies should be sent to Tml under separate cover. The Supplier shall be responsible for ensuring that any of its employees or other persons fulfilling the Order who enter Tml’s premises are suitably clothed, issued with appropriate protective equipment, duly warned of hazards which they may encounter on Tml’s premises and that they adhere to all health and safety at work rules and regulations applicable from time to time.

2.4 Security and Immigration Checks

(a) The Supplier shall comply with all security and related policies notified by Tml and shall promptly provide such information regarding its compliance as may be reasonably required by Tml.

(b) The Supplier shall only use employees, agents or contractors (“Personnel”) who are authorised to work for the duration of this Agreement or any Order in the country where the Supplies are being provided. The Supplier shall provide information evidencing such approvals, clearances and right to work at any time on request by Tml and/or Tml’s customers.

(c) Where Tml and/or Tml’s customers carries out security, immigration and/or work permit checks directly on the Personnel, the Supplier shall obtain demonstrable consent from such Personnel permitting release of their personal data for such purpose.

2.5 Data Protection The Supplier shall comply with the Data Protection Act 1998 (or equivalent legislation in the country where the Supplies are being provided) and, where processing personal data on Tml's behalf, shall process such data strictly in accordance with Tml's instructions and put such operational and technological processes in place to safeguard against any unauthorised access, loss, destruction, theft, use or disclosure of the data. The Supplier shall not delegate or subcontract any of its data processing obligations to any third party or transfer personal data outside the EEA without the prior written consent of Tml, such consent not to be unreasonably withheld. Where consent is given and the Supplier transfers personal data outside the EEA pursuant to this Clause, such transfer shall be subject to contractual clauses determined by the European Commission. In addition, notwithstanding Clause 12.2, the Supplier shall indemnify Tml against all costs, expenses, damages, loss, liability or claims incurred by Tml (including those specified in Clause 12.3) as a result of the Supplier's breach of this Clause 2.5.

2.6 Business Continuity The Supplier shall ensure that it has adequate security, business continuity and disaster recovery procedures in place to cope with the risk of major operational disruptions.

3.0 Delivery

3.1 The Supplier shall, at its own expense and during normal business hours (unless Tml otherwise directs), deliver the Supplies, properly packed and secured (in the case of Products), on the Delivery Date to the place specified in the Order or such other location as may be subsequently agreed in writing. Each package should be clearly marked with the Supplier’s name and the delivery address stated on the relevant Order.

3.2 The Supplier shall ensure that one copy of an advice note stating the Order number, the number of packages and the method and route of transport accompanies the Supplies and that a further copy is given to any third party carrier.

3.3 For Supplies delivered in instalments, the Order shall be construed as a single contract in respect of each instalment. However, where Tml has a right to reject any particular instalment, it may at its option reject the entire Order or the instalment.

4.0 Time for Delivery and Performance of the Supplies

4.1 The Supplies may not be delivered or performed earlier or later than the Delivery Date without Tml's permission, otherwise Tml may reject them. Time shall be of the essence of this Agreement and of each Order in relation to delivery of the Supplies.

4.2 If the Supplies or any part thereof are not delivered or performed by the required date Tml shall be entitled to terminate this Agreement and/or cancel the Order, in each case without cost or liability, in respect of the Products undelivered or the Services not performed. Where other Supplies (“Associated Supplies”) have previously been delivered to or performed for or on behalf of Tml by the Supplier and, in the reasonable opinion of Tml, the Associated Supplies cannot be effectively and commercially used by reason of such non-delivery or non-performance of the Supplies then, without prejudice to Clause 7, Tml shall be entitled to reject the Associated Supplies in writing and claim a full refund in respect of any Associated Supplies which have been paid for and no payment shall be due in relation to any Associated Supplies which have not been paid for. Where Tml exercises its option to reject any Associated Supplies, Tml agrees to return to the Supplier, at the Supplier’s expense, any Products or other materials which comprise Associated Supplies as soon as reasonably practicable after it has received a full refund in respect thereof.

5.0 Title and Risk

5.1 Title and risk in the Products shall pass to Tml on delivery, following off-loading and stacking.

5.2 Where Tml exercises its right to reject Associated Supplies pursuant to Clause 4.2, risk and title therein shall revert to the Supplier upon Tml notifying the Supplier in writing that it wishes to exercise its right to reject the Associated Supplies.

6.0 Payment terms

6.1 The Charges shall be stated in the Order and shall be exclusive of VAT or similar duty but inclusive of all other charges. Unless otherwise agreed in writing, Tml shall not be liable to make any payments to the Supplier other than the Charges.

6.2 Subject to Clauses 6.3 and 6.4, Tml shall pay each undisputed invoice properly due, issued and submitted to it by the Supplier thirty (30) days after the (end of month) date of receipt.

6.3 The Supplier must be in possession of an approved Order before commencing any supply under this Agreement. The Supplier shall ensure that Tml’s Order number is referenced on any invoice sent to Tml and acknowledges that without an approved Order number, the invoice will be rejected.

6.4 All invoices must be submitted within thirty days of delivery or performance of the Supplies or expenses being incurred. Unless previously agreed in writing by Tml, invoices submitted more

7.0 Remedies

7.1 In relation to the Supplies, the Supplier undertakes that:

(a) in the case of Products, if within the Warranty Period or a reasonable time thereafter, Tml notifies the Supplier that the Products are in breach of warranty or the provisions of this Agreement then, at Tml’s option, (i) the Supplier will promptly repair or, at Tml's option, replace, the Products so as to remedy the matter constituting the breach without cost (including transportation costs) to Tml; or (ii) the Supplier will accept rejection and return of the Supplies by Tml, whether or not any of the Supplies have been accepted, and the Supplier shall immediately upon receipt return any payments made by Tml in respect of those Supplies. For the avoidance of doubt, risk and title in rejected Products shall immediately on rejection revert to the Supplier; and

(b) in the case of Services, if within the Warranty Period or a reasonable time thereafter, Tml gives written notice that the Services are in breach of warranty or the provisions of this Agreement, the Supplier shall promptly re-perform the Services at no cost to Tml. Where the Supplier fails to provide such remedy, Tml may remedy or have remedied the matter constituting the breach at the cost of the Supplier; and

(c) in any case, if during the Warranty Period the Supplies are in breach of warranty or otherwise in breach of this Agreement, Tml may, at its option, cancel the Order, at no cost or liability to Tml, and/or refuse to accept any further deliveries and/or performance of Supplies. The Supplier shall immediately refund any charges paid in advance by Tml in respect of the Supplies.

7.2 Without prejudice to Tml’s rights under Clauses 7.1, if during the Warranty Period or within two (2) years of its expiry, the Products develop any persistent defects, failures or non-conformities, the Supplier will, on Tml’s request, review such defects, failures or non-conformities with Tml and indicate steps or recommendations which in the Supplier’s reasonable judgement would remedy the same. Subject to an agreed action plan, the Supplier shall at its own cost remedy the defects, failures and non-conformities. Where the Supplier fails to provide such remedy, Tml may remedy or have remedied the failure, defect or non-conformity at the Supplier's cost and reject deliveries of Supplies until the source of failures, defects and non-conformities has been cured.

7.3 Tml’s rights and remedies under Clause 7 are in addition to its other rights and remedies under this Agreement or at law.

8.0 Quality requirements

8.1 : As a supplier to TML Precision Engineering Ltd, it is understood that your

Organization agrees to meet the following stipulations / AS9100 requirements whenever a TML Precision Engineering Ltd Purchase Order specifies that the order is for an aerospace

application/job (or contains some similar aerospace/AS9100 reference). These requirements are, therefore, to be considered as terms and conditions to all aerospace purchases.

8.2 Where required on the TML Precision Engineering Ltd Purchase Order, its suppliers must

use TML Precision Engineering Ltd’s customer-approved special process sources.

8.3 TML Precision Engineering Ltd is to be contacted (by the supplier) in the event of

nonconforming product/material. Arrangements for the approval of supplier nonconforming

product/material must be as directed by a TML Precision Engineering Ltd’s authorized

manager or designee.

8.4 Furthermore, the supplier is required to notify TML Precision Engineering Ltd of any

changes to a product and/or process and to obtain approval from an authorized TML Precision Engineering Ltd manager or designee (if applicable).

8.5 TML Precision Engineering Ltd, their customers, and regulatory authorities retain the right of access to all supplier facilities involved in the aerospace order and to all applicable records.

8.6 The AS9100 standard requires that all applicable customer/regulatory/AS9100 requirements for the supplier to flow-down to sub-tier suppliers (includes requirements in the purchasing documents and key characteristics where required). However, TML Precision Engineering Ltd does not allow its aerospace suppliers to subcontract any product or process to a sub-tier supplier without TML Precision Engineering Ltd expressed written consent.

8.7 TML Precision Engineering Ltd performs inspection activities to ensure that purchased

product meets purchase requirements. They may include:

Receiving inspections (of supplier products / services / documents) may be / are

performed by a designated employee. TML Precision Engineering Ltd verifies the

authenticity of the appropriate certificate of conformity, material certificates, etc. and

other accompanying documentation by review and comparison (as is appropriate) to the

drawing and/or industry specifications or by other means. When necessary, TML Precision Engineering Ltd may inspect or audit at the supplier’s facility.

Furthermore, products are inspected to ensure they meet requirements (dimensions, etc.)

and the results are recorded (as appropriate). All special processes (anodizing, heat treat

etc.) where the compliance cannot be verified by inspections will require a Certificate of

Conformity.

8.8 When appropriate, TML Precision Engineering Ltd may delegate the inspection authority to one of its approved suppliers. TML Precision Engineering Ltd will communicate the

inspection requirements (including approved monitoring and measurement equipment/methods) and TML Precision Engineering Ltd will maintain a record of those approved to carry out such inspections.

8.9 When TML Precision Engineering Ltd or its customer intends to perform verification at the supplier’s premises; TML Precision Engineering Ltd will first state the intended verification arrangements and the method of product release. This information will be communicated on the TML Precision Engineering Ltd Purchase Order or via another acceptable purchasing arrangement.

8.10 Where specified in the contract, the TML Precision Engineering Ltd’s customer or

customer’s representative will be afforded the right to verify at the supplier’s premises and TML Precision Engineering Ltd premises that subcontracted product conforms to specified

requirements. Verification by the customer is not used by TML Precision Engineering Ltd as

evidence of effective control of quality by the supplier and shall not absolve TML Precision Engineering Ltd or its supplier of the responsibility to provide acceptable product, nor shall it

preclude subsequent rejection by the customer.

8.11 To prevent the purchase of counterfeit or suspect/unapproved products and to ensure product identification and traceability (and for other reasons), TML Precision Engineering Ltd will institute controls that include the requirement of Material Certificates, Certificates of

Conformity, and/or other supporting documentation from its suppliers as is appropriate. These requirements may be specified on TML Precision Engineering Ltd’s Purchase Order or may otherwise be communicated to the supplier.

9.0 Dispute Resolution Procedure

9.1 Any question or difference which may arise out of or in connection with this Agreement shall in the first instance be referred to the representatives of Tml and the Supplier nominated for discussion and resolution. If the matter is not resolved within 21 days of such referral, the escalation will continue through two (2) more levels of management. If the unresolved matter is having a serious effect on the performance of this Agreement, the parties will use best endeavours to minimise the escalation time. Neither party may initiate any legal action until the process has been completed, unless such party has reasonable cause to do so to avoid damage to its business or to protect or preserve any right of action it may have, including without limitation to seek injunctive relief in respect of any breach of its Intellectual Property Rights or similar rights.

9.2 If the dispute is not resolved by escalation in accordance with Clause 9.1 above, the parties may seek to resolve disputes between them by an alternative dispute resolution technique recommended by the Centre for Dispute Resolution in the UK.

10.0 Termination

10.1 If either party: (a) being a company, has a petition presented for its liquidation or calls a meeting to propose a resolution for its liquidation (other than solely for solvent amalgamation or reconstruction) or has a petition presented for the appointment of an administrator or has a receiver or administrative receiver appointed over it or any of its assets or makes any voluntary arrangement with its creditors; or (b) being an individual (or if a firm or partnership, any of its partners or members), has a petition presented for his bankruptcy, or has a receiver appointed over his affairs, or makes any voluntary arrangement with his creditors or (in the case of a firm or partnership) proposes or has presented against it a petition for its dissolution; or (c) in either case undergoes any analogous event in any jurisdiction where it is domiciled, then the other party may terminate this Agreement and/or any Order by written notice to the other taking immediate effect.

10.2 Tml reserves the right to cancel the Agreement or any Order for any reason and without cost or liability (save for any Supplies already delivered or performed) by giving the Supplier written notice at least thirty (30) days prior to the agreed time for delivery or performance.

10.3 Upon termination of this Agreement or, where relevant, an Order for whatever reason:-

(a) the Supplier shall reimburse any sums paid in advance by Tml for Supplies ordered but not yet received as at the date of termination;

(b) the parties will return Confidential Information of the other party and the Supplier shall at its cost forthwith return all Diagnostic Materials and any Tml Property and Tml may enter any premises to recover such items at the Supplier’s cost;

(c) the Supplier shall give Tml all reasonable assistance necessary to facilitate the orderly transfer of the Supplies to an alternative service provider.

11.0 Confidentiality

11.1 The Receiving Party undertakes that it will take all necessary precautions to ensure that all Confidential Information is treated as confidential and that it (and any person employed or engaged by it in connection with the Supplies) uses Confidential Information of the Disclosing Party only for the purposes of this Agreement and shall not disclose any such Confidential Information to any third party without the prior written consent of the Disclosing Party or as set out herein.

11.2 The Receiving Party may disclose Confidential Information:

(a) pursuant to a duty imposed by law or the requirements of a regulatory authority but only to the extent so required;

(b) to give proper instructions to any professional adviser under an obligation to keep such Confidential Information confidential;

14.3 Confidential Information shall not include, and the obligations contained in this Clause 14 shall not apply, in respect of information:

(a) which was in the public domain at the time of disclosure;

(b) which, though originally Confidential Information, subsequently falls into the public domain through no fault of the Receiving Party;

(c) independently developed by the Receiving Party or its employees or agents where such party can show it has no access to that information as Confidential Information of the Disclosing Party received under this Agreement; or

(d) lawfully in the possession of the Receiving Party at the time of receipt which is subsequently lawfully received from a third party not under an obligation of confidentiality to the Disclosing Party in respect of that information.

11.4 Without prejudice to the generality of Clauses 11.3 (a) – (d) above, information shall not be deemed to be in the public domain by reason only that it is known to only a few of those people to whom it might be of commercial interest and a combination of one or more items of Confidential Information with information in the public domain shall not cause such Confidential Information to be deemed to be in the public domain.

11.5 Each party undertakes to the other to take all such steps as shall from time to time be necessary to ensure compliance with the provisions of Clauses 11.1 and 11.2 by its employees, agents, consultants and sub-contractors. For the avoidance of doubt, the Supplier acknowledges that Tml may require and the Supplier shall procure undertakings as to confidentiality directly from its employees in terms no less onerous than the terms contained in this Clause 11.

11.6 Neither the Supplier nor any person engaged by it whether as an employee, servant, agent or sub-contractor shall use the Confidential Information for the solicitation of business from Tml.

11.7 The Supplier shall not advertise or publicly announce its involvement in the Agreement without the prior written consent of Tml.

12.0 Limitation of Liability and Insurance

12.1 Notwithstanding anything to the contrary in this Agreement, Tml's liability to the Supplier for any loss, damage, costs, claims or expenses suffered by the Supplier under or in connection with this Agreement, whether arising from a breach of contract, negligence or howsoever, shall be limited as follows:

(a) in the case of liability arising from death or injury to persons as a result of any act or omission of Tml which is negligent (as defined by the Unfair Contract Terms Act 1977 section 1) or of any fraud on the part of Tml or of the acts, omissions or frauds of others for whom Tml is at law responsible, there shall be no limit;

(b) in respect of any other liability Tml's aggregate liability shall in no circumstances exceed the Charges for the Supplies in respect of which the claim arises; provided always that Tml’s total aggregate liability for all such claims arising in connection with this Agreement whether in contract, tort (including negligence) or otherwise shall be limited to and in no circumstances exceed £1,000,000.

12.2 The Supplier’s liability to Tml for any loss, damage, costs, claims or expenses suffered by Tml under or in connection with this Agreement, whether arising from a breach of contract, negligence or howsoever, shall be limited as follows:

(a) in the case of breach of Clause 2.5 (Data Protection), and Clause 11 (Confidentiality) or liability arising from death or injury to persons as a result of any negligent act or omission of the Supplier, which is negligent (as defined by the Unfair Contract Terms Act 1977 section 1) or of any fraud on the part of the Supplier or of the acts, omissions or frauds of others for whom the Supplier is at law responsible, there shall be no limit;

(b) in respect of any other liability the Supplier’s aggregate liability shall in no circumstances exceed three (3) times the Charges paid or payable under the Agreement or £1,000,000, whichever is greater.

12.3 Subject to Clauses 12.1(a), and 12.2(a), in no event will either party be liable to the other for:

(a) loss of profits, loss of revenue or loss of anticipated savings; or

(b) loss of business or opportunity, loss of goodwill or injury to reputation, arising out of or in connection with this Agreement.

12.4 Where the Supplier send its employees to Tml’s and/or Tml’s customers’ premises in connection with this Agreement then, notwithstanding any technical supervision exercised by Tml or any instructions issued by Tml, such employees shall remain the Supplier’s employees alone. It is an express condition of this Agreement and each Order that the Supplier effects and maintains in force for the benefit of the Supplier and Tml employer’s liability insurance in respect of such employees. Further the Supplier shall effect and maintain for the duration of this Agreement, or if any Order survives its termination, for the duration of that Order, such other insurance as is appropriate in the circumstances taking into account industry practice, the availability of insurance in the market place and the risks and liabilities which it is accepting under this Agreement. The Supplier shall provide Tml with written evidence of the existence of insurance cover required under this Clause 15 at any time on request, together with evidence that the last premium has been paid and shall notify Tml in writing of any change in the same.

12.5 The Supplier shall indemnify Tml against any loss of or damage to Tml Property and/or Tml’s customers’ property caused by the Supplies or by the act or default of the Supplier or its employees, agents or sub-contractors. All risk of loss or theft of or damage to any property of the Supplier or belonging to the Supplier’s personnel while at Tml’s premises and/or Tml’s customers’ premises for any reason whatsoever shall be and remain the sole risk and responsibility of the Supplier.

13.0 General

13.1 Force Majeure Neither party will be liable for delay in or for failure to perform obligations if that delay or failure is caused by circumstances beyond the reasonable control of the party affected including, but not limited to, refusal or revocation of licence, industrial dispute or impossibility of obtaining materials (a "Force Majeure Event") provided that:

(a) a claim for relief by the Supplier shall not be valid to the extent that a prudent supplier of supplies similar to the Supplies could have foreseen and/or prevented or avoided the Force Majeure Event;

(b) the affected party's obligation to perform the relevant obligations under this Agreement shall (during the continuation of the Force Majeure Event) be read and construed as an obligation to perform such obligations to the best level reasonably achievable in the circumstances;

(c) an inability to obtain sub-contracted services or supplies shall not constitute a Force Majeure Event except where no substitute is available;

(d) industrial action, strikes and lock-outs by employees of the Supplier shall not constitute a Force Majeure Event unless affecting the relevant industry on a national basis; and

(e) if the Supplier is prevented from performing its obligations under an Order by a Force Majeure Event which continues for more than 30 days, Tml may at its option terminate any affected Order without liability to the Supplier forthwith by giving written notice.

13.2 Assignment: The Supplier may not assign, transfer or delegate any of its rights or obligations under this Agreement in whole or in part without the prior written consent of Tml and any purported assignment or transfer shall be null and void and all acts and omissions by the assignee or transferee are deemed to be those of the Supplier. Delegation, whether authorised or not, shall not relieve the Supplier of any of its liability or obligations under this Agreement.

13.3 Notices All notices hereunder shall be in writing addressed to the parties at their respective addresses set forth in the Order or such other address as may be notified from time to time by either party to the other.

13.4 Waiver No terms or conditions hereof shall be deemed waived and no breach or default excused unless such waiver or excuse shall be in writing and signed by the party issuing the same.

13.5 Variations No variation of this Agreement or of any of the documents referred to in it shall be valid unless it is in writing and signed by or on behalf of both parties.

13.6 Non-solicitation During the Agreement and for a period of six (6) months after either its termination or the end of the provision of the Supplies (whichever is later), the Supplier shall not solicit the employment or services of any Tml personnel who has been engaged in connection with the Supplies.

13.7 Severance If any provision of this Agreement is found by a court of competent jurisdiction to be invalid or unenforceable, such invalidity or unenforceability shall not affect the other provisions of this Agreement, which shall remain in full force and effect.

13.8 Survival The following clauses shall survive termination of this Agreement: Clauses 11 (Confidentiality), 12 (Limitation of Liability and Insurance), 13.12 (Governing Law and Jurisdiction).

13.9 Relationship of Parties Nothing in this Agreement shall create a partnership or a fiduciary relationship or the relationship of employment between Tml and the Supplier. The Supplier shall not make any direct or indirect approach to Tml’s customer without Tml’s prior written consent.

13.10 Cumulative Remedies The rights and remedies of the parties under this Agreement are cumulative and without prejudice and in addition to any rights or remedies at law or in equity.

13.11 Rights of Third Parties A person who is not a party to this Agreement has no right under the Contracts (Rights of Third Parties) Act 1999 to enforce any term of this Agreement but this does not affect any right or remedy of a third party which exists or is available apart from that Act.

13.12 Governing Law and Jurisdiction The construction, validity and performance of this Agreement and all non-contractual obligations arising from or connected with this Agreement shall be governed by the laws of England and, without prejudice to Clause 9 (Dispute Resolution Procedure), the parties submit to the exclusive jurisdiction of the English courts. Notwithstanding the other provisions of this Agreement, Tml shall be entitled to bring an action in any jurisdiction where this relates to the protection of its Intellectual Property Rights or other rights, or those of its licensors.