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GENERAL TERMS AND CONDITIONS OF SALE

1. TAXES AND FEES: Prices stated herein do not include any manufacturers, sales, use or other excise taxes or duties, and the amount of any thereof which Seller is required to pay or collect will be invoiced to Buyer. Buyer shall pay all such taxes and duties arising by reason of this order and all other taxes and duties of whatever nature assessed upon the goods and/or services described on the front side hereof (hereinafter referred to as "the Articles"). Buyer shall also pay any collection fees and reasonable attorney’s fees incurred by Seller in collecting payment of the purchase price and any other amounts for which Buyer is liable under the terms and conditions hereof.

2. WARRANTY: Dorris warrants that each gearbox will deliver successfully its rated capacity as indicated in the catalog, provided it is properly installed, maintained and operated in the environment and within the limits of speed, torque and other load conditions for which it was sold. Dorris Installation, Lubrication and Maintenance Instructions are provided with each gearbox and must be followed in strict accordance. Damage caused by misuse, negligence or accident is not covered.

The guarantee period for all gear reducers is two years from the date of shipment from our factory or 4,000 hours of operation, whichever comes first. Materials or workmanship that prove defective will be replaced or repaired at the option of the Dorris Company, F.O.B. This warranty is in lieu of all other expressed or implied warranties. IN NO EVENT SHALL THE DORRIS COMPANY OR SMART GEARS BE LIABLE FOR ANY SPECIAL, INDIRECT OR CONSEQUENTIAL DAMAGES (INCLUDING BUT NOT LIMITED TO, LOST PROFITS OR OTHER DAMAGES FROM LOSS OF PRODUCTION) CAUSED BY MATERIAL OR WORKMANSHIP THAT IS PROVEN TO BE DEFECTIVE.

3. PATENT INDEMNITY: A. In the event any Article furnished hereunder is claimed to infringe any United States patent issued at the time of delivery, Seller agrees, at its option: (1) to procure for Buyer the right to use the Article, or (2) to modify or replace the Article so as to avoid infringement, or (3) to accept redelivery of the Article and reimburse Buyer for the purchase price and any reasonable transportation expenses incurred by Buyer. Should any litigation be instituted against Buyer based on a claim that any Article in the condition received from Seller infringes any United States patent, Seller will undertake the defense thereof on Buyer’s behalf and pay any damages and cost awarded therein against Buyer, provided Seller is given prompt written notice and is furnished with copies of all demands, process and pleadings; and provided Buyer cooperates fully in giving Seller authority, information and assistance at Seller’s expense for such defense, as well as control over the defense and any negotiations with regard to settlement.

B. THE FOREGOING REPRESENTS SELLER’S ENTIRE AND EXCLUSIVE OBLIGATION WITH RESPECT TO ANY CHARGE OF PATENT INFRINGEMENT. SELLER SHALL HAVE NO RESPONSIBILITY INSOFAR AS ANY ARTICLE IS MODIFIED BY BUYER OR IS MADE OR MODIFIED BY SELLER IN ACCORDANCE WITH BUYER’S ORDER, AND BUYER SHALL INDEMNIFY SELLER IN ACCORDANCE WITH THE INDEMNITY IN PARAGRAPH A ABOVE FOR ANY CLAIM WHICH ARISES OUT OF SELLER’S COMPLIANCE WITH BUYER’S SPECIFICATIONS. SELLER SHALL ALSO HAVE NO RESPONSIBILITY WITH REGARD TO ANY SETTLEMENT, ADMISSION OR PROMISE MADE BY BUYER WITHOUT SELLER’S PRIOR WRITTEN CONSENT, NOR SHALL SELLER BE LIABLE FOR ANY INDIRECT, SPECIAL OR CONSEQUENTIAL DAMAGES OR ANY NATURE WHATSOEVER, INCLUDING LOSS OF PROFITS, CLAIMED TO HAVE BEEN SUSTAINED BY BUYER OR ANY USER OF AN ARTICLE ARISING OUT OF ANY CLAIM OF INFRINGEMENT.

C. Seller may be entitled to indemnity from certain of its suppliers, and the rights and options vested in Seller shall extend to such suppliers and may be exercised by them.

4. ENTIRE AGREEMENT: This writing is intended by the parties to be a final expression of their agreement and is intended also as a complete and exclusive statement of the terms and conditions thereof.

5. MODIFICATIONS TO BE IN WRITING: No waiver or modification of any of the provisions hereof shall be binding upon Seller unless in writing and signed by an authorized representative of Seller.

6. NOTICE: Any notice relating to this Agreement shall be considered given if and when deposited in the United States mail, postage prepaid, addressed to the other party at the address given herein.

7. ACCEPTANCE AND FULFILLMENT OF ORDER: Orders are subject to acceptance by Seller only at Seller’s offices. The acceptance and fulfillment of orders and agreements by Seller are contingent upon and subject to accidents, breakdowns, strikes, riots, sabotage, insurrection and war, and delays, interruptions in or failure of sources of material, supplies, equipment, labor and transportation, and to the acts of God or the public enemy, or to other causes and conditions, whether of like or different nature, affecting Seller, and to orders, contracts, priorities, directives, requisitions or requests of the Federal or State Governments of the United States of America, whether or not voluntarily assumed.

8. CLAIMS, CANCELLATION, MODIFICATION, and SUSPENSION: Claims, other than warranty claims in accordance with paragraph 2 above, must be made within one hundred twenty (120) days after receipt of the Articles. Cancellation, modification, suspension or delay in shipment of Buyer’s order will not be accepted on terms which will not fully indemnify Seller against loss, such indemnity to include recovery of all direct costs incurred, attendant normal indirect and overhead charges, and a reasonable profit.

9. CONTROLLING LAW: This transaction shall be governed by, and this Quotation shall be construed and enforced in accordance with, the internal laws of the state of Michigan. If any provision, clause or part, or the application thereof under certain circumstances, is held invalid, the remainder of this Quotation or the application of such provision, clause or part under other circumstances shall not be affected thereby.

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