Xperience Communications, LLC

Terms and Conditions of Purchase

Effective as of July 1, 2008

• Invoicing; Pricing; Payment; Setoff. The stated price of goods and services, including but not to limited to creative concepts, scripts, descriptions, copy, illustrations, designs, photographs, code, samples, processes, music, video and film rights ("Products and Services") as set forth in a purchase order or purchase order revision ("Order") includes storage, handling, packaging, freight, insurance, transportation, and all other expenses, costs and charges of Vendor, unless Buyer agrees otherwise in writing in the Order. The stated price of Products and Services also includes all applicable taxes, excises, duties and other governmental impositions, except for any value added tax (VAT) imposed by a non-USA jurisdiction, which must be shown separately on Vendor's invoice for each shipment, and Buyer shall not be liable for any business activity taxes or taxes on or measured by net income. Prices are not subject to increase, including any increase based upon changes in raw material, component pricing, labor, or overhead, unless specifically stated in the Order. Vendor also agrees that final invoices will be submitted no later than 15 business days after completion of Products and Services and deliverables, and understands that invoices submitted later than 15 days after completion of Products and Services will not be paid. Payment shall be made as set forth in the Order (or any related document(s) made part of this Order). Payment will be made in the currency expressly stated in the Order; if no such currency is noted, payment will be made in U.S. Dollars. Payment will be made by mailing on or before the due date unless otherwise expressly agreed by Buyer. In addition to any right of setoff or recoupment provided by law, all amounts due to Vendor shall be considered net of indebtedness of Vendor and its affiliates or subsidiaries to Buyer and its affiliates or subsidiaries. Buyer shall have the right to set off against or to recoup from any payment or other obligation owed to Vendor, in whole or in part, any amounts due to Buyer or its affiliates or subsidiaries from Vendor or its affiliates or subsidiaries, whether that payment or obligation is contested, uncontested, contingent, liquidated or unliquidated.
• Packaging; Shipping. Vendor agrees to properly pack, mark and ship Products and Services in accordance with the requirements of Buyer, the involved carriers and the country of destination. Vendor agrees to comply with all federal, state, provincial and local laws and regulations pertaining to product content and warning labels.
• Audit; Non-Conforming Goods. Upon reasonable notice to Vendor, either Buyer or Buyer’s Customer (as hereinafter defined) may conduct a routine audit of Vendor’s records, at any time prior to two (2) years following final payment by Buyer under an Order, in order to verify Buyer's payment obligations to Vendor. If defective Products and Services are shipped to and rejected by Buyer, the quantities under the Order will be reduced unless Buyer otherwise notifies Vendor.
• Changes. Buyer reserves the right to direct changes, or to cause Vendor to make changes, to creative concepts, designs, drawings, specifications, scripts, copy, photographs, illustrations, code, processes, music, video and film rights, samples or descriptions of Products and Services. Vendor agrees to promptly make any requested changes. Vendor will not make any change to the Products and Services or date or place of delivery except at Buyer's written instruction or with Buyer's written approval. If such change affects delivery or price, Vendor shall promptly notify Buyer and provide documentation in support of such change, and Buyer, may equitably adjust the price or time for performance.
• Warranties. Vendor warrants the Products and Services will conform to any creative designs, drawings, specifications, statements of work, samples, and/or other descriptions and requirements relating to the Products and Services furnished by Buyer as part of the Order. Vendor warrants that Products and Services will be fit and sufficient for the purpose intended, except to the extent that any defect in the Products and Services is due to Vendor's conformance to any drawings or specifications provided to Vendor by Buyer. Vendor also warrants that all Products and Services will be merchantable, of good material and workmanship, free from defect in design, manufacture and/or otherwise, and in compliance with all applicable statutes, regulations and standards. These warranties shall survive inspection, test, acceptance of, and payment for the Products and Services and shall run to Buyer and its customers, end users and end customers. Vendor's warranty hereunder will be coterminous with the warranty terms as to time and/or mileage extended by Buyer to its Customers, end users or end customers for the Products and Services or end products employing any such Products and Services as a part or component thereof.
• Proprietary Information and Confidentiality. (a) Vendor shall hold all information furnished by Buyer in confidence and shall not disclose any such information to any other person or use such information itself for any purpose other than performing an Order without prior written consent from Buyer. The restrictions contained in this paragraph shall apply to creative concepts, scripts, copy, illustrations, designs, photographs, samples, processes, music, video and film rights, drawings, specifications, technical know-how, software object code and source code, protocols, strategic business plans, financial information, product information, marketing information, methods of operation, customer information, supplier information, compilations of data, and all other documents and information communicated to Vendor or learned by Vendor in connection with an Order and to drawings, specifications and other documents prepared by Vendor for Buyer in connection with an Order. (b) Vendor grants to Buyer a non-exclusive, paid-up, irrevocable license to copy, distribute or otherwise use all copyrighted drawings, specifications, catalogue descriptions or other materials of Vendor which are furnished to Buyer under an Order.
• Intellectual Property. (a) Vendor warrants to Buyer that it is the owner or licensee of all patents, copyrights and other intellectual property embodied in or furnished as part of Vendor’s performance of any Order. Vendor agrees to defend, hold harmless, and indemnify Buyer and its Customers against all claims, demands, losses, suits, damages, liability and expenses (including license fees and attorneys’ fees) arising out of any suit or claim or action for actual or alleged direct or contributory infringement of, or inducement to infringe, any United States or foreign patent, trademark, copyright or mask work right by reason of the manufacture, use or sale of the goods or services to be furnished or performed under an Order, or for the actual or alleged misuse or misappropriation of a trade secret resulting from Vendor’s actions. (b) Vendor agrees that all discoveries, designs, inventions, improvements and other intellectual property rights whether copyrightable, patentable or not which are written, conceived, discovered or made by Vendor’s employees or subcontractors in the performance of an Order shall be promptly disclosed to Buyer and shall become Buyer’s sole property. Vendor further agrees to sign and execute all assignments and other papers necessary to vest the entire right, title and interest in such discoveries, designs, inventions, improvements and other intellectual property to Buyer and do all other lawful acts Buyer may reasonably request relating to such intellectual property rights. (c) In particular, Vendor agrees that Buyer will own all right, title and interest in all ideas, plans, and materials prepared by Vendor (collectively included as, the “Material”). The foregoing rights include, but are not limited to: (i) all copyrights in the Material, and (ii) all causes of action related to these rights, including all past, present, and future causes of action. Vendor acknowledges that the Material will be considered a “work-made-for hire” as that term is defined in the United States Copyright Act of 1976, 17 U.S.C. § 101. To the extent that the Material, or any portion thereof, is not copyrightable subject matter or for any reason is judicially determined not to be a “work-made-for-hire”, Vendor hereby assigns to Buyer all right, title and interest to the Material. During the term of any Order and thereafter, Vendor agrees to execute and deliver any documents Buyer deems reasonably necessary to perfect its ownership interests in the Material without any additional consideration. Without limiting the foregoing, it is understood and agreed that Vendor will retain no rights whatsoever in or to the Material. Vendor will not use any third party to help create or develop the Material unless Vendor first obtains a written agreement from such third party that assigns to Vendor, at no cost to Buyer, all of the third party’s right, title, and interest in and to the Material and any intellectual property rights therein. Vendor warrants and represents that each of Vendor’s employees, consultants, contractors, partners, agents and affiliates who has been or will be involved in the performance of Vendor’s obligations under an Order has signed or will sign an agreement with Vendor conveying to Vendor all rights as necessary for Vendor to meet its obligations under an Order.
• Covenant Not To Compete. During the term of any Order and for a period of twenty (24) months thereafter, Vendor shall not, without the prior written consent of Buyer, solicit or accept business directly or indirectly from any person or entity which is a Customer of Buyer.
• Non-Solicitation. Vendor shall not (a) recruit or solicit any other employee of Buyer to discontinue such employment or employment; seek to employ or retain any such employee or agent; or cause any business, person, firm or corporation which competes directly or indirectly with Buyer to seek or solicit the employment or retention of any such employee or agent or (b) solicit or encourage any business, person, firm or corporation which has a business relationship with Buyer to seek to discontinue such relationship.
• Reasonable Restriction. Vendor agrees that the duration, activities restricted and scope of the provisions set forth in Sections 8 and 9 are reasonable, and are reasonably necessary to protect the business and good will of the Buyer. If any court determines that the duration, activities restricted or geographic scope, or any combination thereof, are unreasonable and that such provision is to that extent unenforceable, the provision shall remain in full force and effect for the greatest time period, with respect to the broadest type of activities described, and in the greatest geographic area that would not render it unenforceable. Vendor expressly acknowledges that the obligations of Buyer provided herein are full and adequate consideration for the restrictions in this Sections 8, 9 and 10.
• Customer Requirements. (a) As directed by Buyer in writing, Vendor agrees to comply with the applicable terms and conditions of any agreements (“Customer Purchase Orders”) received by Buyer from a third party (“Customer”), or directly or indirectly applicable to Buyer, pursuant to which or in respect to which Buyer agrees to supply to Customer, or incorporate into goods supplied to Customer, Products and Services purchased by Buyer from Vendor. The term Customer shall also include the final equipment manufacturer of goods or services into which the Products and Services are or will be incorporated. Buyer may in its discretion supply Vendor with information regarding the Customer Purchase Orders, but Vendor shall be responsible for ascertaining any terms and conditions contained in Customer Purchase Orders that may affect Vendor’s obligations under an Order. Vendor will do everything within its control to enable Buyer to meet the terms and conditions of the Customer Purchase Orders. If this Section conflicts any other paragraph in an Order, Buyer has the right to have the provisions of this Section prevail. (b) In the event that a Customer files or has filed against it a petition in bankruptcy or insolvency and, in the course of such proceeding and in connection with actual or threatened termination (by rejection or otherwise) by the Customer of its contract(s) with Buyer or contracts relating to goods and services incorporating Products and Services purchased by Buyer from Vendor, Buyer permits a reduction in the price(s) paid to Buyer for such goods and services incorporating the Products and Services, the price paid to Seller for the Products and Services from and after the date of such reduction will be automatically adjusted proportionally by the same percentage as the price paid to Buyer by its direct Customer and an Order will otherwise remain in effect without modification. (c) In addition to the foregoing, (i) Buyer will pay Vendor for the Products and Services only following and to the extent of, and in proportion to, Buyer’s actual receipt of payment from its Customer for those goods in which the specific Products and Services are incorporated, (ii) any lengthening of its Customers’ payment terms to Buyer will automatically lengthen the payment terms as between Buyer and Vendor by the same amount of time; and (iii) within three (3) business days of any change in price, specifications or other terms negotiated or proposed between Vendor and Buyer’s direct or indirect Customer, Vendor shall notify Buyer in writing and immediately adjust its invoices to reflect any price reduction, provided that no change will be binding on Buyer without Buyer’s specific written consent.
• Remedies; Indemnification.The rights and remedies reserved to Buyer in the Order shall be cumulative with and additional to all other or legal or equitable remedies. Vendor will reimburse Buyer for any incidental or consequential or other damages caused by nonconforming Products and Services including but not limited to attorneys' fees and other professional fees, settlements and judgments incurred by Buyer and other costs associated with Buyer's administrative time, labor and materials. To the fullest extent permitted by law, Vendor will defend, indemnify and hold harmless Buyer, Buyer's customers and dealers and users of the products sold by Buyer, including their respective agents, customers, invitees, subsidiaries, affiliates, successors and assigns, against any and all claims, damages, losses, liabilities, and expenses arising out of or resulting in any way from any defective Products and Services, or from any negligent or wrongful act or omission of Vendor, or Vendor’s agents, employees or subcontractors, or any breach or failure by Vendor to comply with any of Vendor's representations or other terms and conditions of an Order (including any part of these Terms).
• Termination for Breach or Nonperformance. Buyer reserves the right to terminate all or any part of this Order, without liability to Vendor, if: (a) Vendor repudiates, breaches or threatens to breach any of the terms of an Order, including without limitation Vendor's warranties, (b) fails to perform or threatens not to perform services or deliver Products and Services as specified by Buyer, (c) Vendor files or has filed against it a petition in bankruptcy or insolvency or Vendor liquidates a substantial portion of its assets or otherwise dissolves, or (d) any other event occurs which causes reasonable doubt as to Vendor’s ability to render due performance hereunder. In the event of termination for cause, Vendor shall be liable to Buyer for any and all damages sustained by reason of such default.
• Termination. In addition to any other rights of Buyer to cancel or terminate an Order, Buyer may, at its option and in its sole discretion, terminate immediately all or any part of an Order at any time and for any reason, by giving notice to Vendor. Upon termination by Buyer under this Section 14, Vendor shall immediately stop all work hereunder, cause any of its suppliers or subcontractors to cease such work and take all other necessary steps to minimize its costs hereunder. Vendor shall deliver completed equipment, goods, materials and work in progress in accordance with Buyer’s instructions. Buyer will be obligated to pay Vendor only the following: (i) the Order price for all finished Products and Services in the quantities ordered by Buyer that were not previously paid for, (ii) Vendor's reasonable actual cost of work-in-process and the parts and materials transferred to Buyer, and (iii) Vendor's reasonable actual costs of settling claims regarding its obligations to subcontractors required under the Order, to the extent directly caused by the termination. Buyer's obligation upon termination under this Section 14 shall not exceed the obligation Buyer would have had to Vendor in the absence of termination.
• Standards of Conduct. All free lance independent contractors, suppliers, agents and individuals and organizations doing business with Buyer are required to adhere to the provisions of Buyer's Standards of Conduct set forth in this Section, as follows: (a) Gifts. Persons may not give, solicit, or accept gifts or gratuities from anyone doing business with Xperience, which have more than a modest token value no greater than $50.00. If a gift is inadvertently sent by a customer or supplier, it must be returned to the person or firm from which it came, with a polite note explaining Xperience’s policy. (b) Entertainment. It is Xperience's intent to establish and maintain relations with suppliers and customers based on mutual confidence, respect, and cost considerations. No Person may accept from any person or firm any entertainment other than that which is considered an ordinary and occasional social amenity (which would include a business lunch/dinner, sporting event, or single day entertainment event). (c) Relationships With Suppliers and Competitors. Persons of Xperience shall not: (i) own or acquire any substantial interest in any prospective supplier or other entity with which Xperience does business or who is a competitor of Xperience. An insubstantial interest in a publicly traded company is not objectionable; (ii) lend money to or borrow money from any supplier, customer, or competitor of Xperience; (iii) represent the interests of any party other than Xperience (including personal interests) in any material transaction in which Xperience and another party is involved, or (iv) communicate in advance with any competitor regarding the price to be paid for any commodity or service Xperience buys or the price to be charged for anything Xperience sells.
• Governing Law; Arbitration. This Order is to be construed according to the laws of the State of Michigan, excluding the provisions of the United Nations Convention on Contracts for the International Sale of Goods and any conflict of laws provisions that would require application of another choice of law. The arbitration provisions of this Section will be governed by the United States Federal Arbitration Act. At Buyer's option, exercised by written notice any time before or within 30 days following the service of process in a legal action, any dispute regarding the Products and Services, an Order, the validity of an Order or any of these Terms, or any other matter between the parties (other than requests for injunctive relief) will be resolved by binding arbitration, conducted in the English language and using a single arbitrator to be selected solely by the Buyer, to be conducted at a location also to be selected solely by the Buyer. The arbitration will be conducted under the commercial arbitration rules of the American Arbitration Association (AAA) and under Rules 26 through 37 of the U.S. Federal Rules of Civil Procedure. The arbitrator will issue written findings of fact and conclusions of law, and may award attorneys' fees and costs to the substantially prevailing party. In no event will any party be awarded punitive or exemplary damages. A judgment of any court of competent jurisdiction shall be entered upon the award.
• Entire Agreement; Modifications; No Implied Waiver. All Orders and these Terms constitute the entire agreement between Vendor and Buyer with respect to the matters contained in such Orders and supersede all prior oral or written representations and agreements. An Order and these Terms may only be modified by a written amendment executed by authorized representatives of each party by a purchase order amendment issued by Buyer. The failure of either party at any time to require performance by the other party of any provision of an Order shall in no way affect the right to require performance at any later time, nor shall the waiver of either party of a breach of any provision of an Order constitute a waiver of any later breach of the same or any other provision of such Order.