Terms of Sale

The sale of products (“Products”) from CompX Security Products Inc. (hereinafter referred to as “Seller”) to buyer (“Buyer”) shall be governed by the terms and conditions in any written contract currently in effect between Buyer and Seller covering such sale and all other terms contained herein which are not inconsistent with such contract. To the extent that the terms and conditions of such written contract are silent with respect to any matter addressed herein, these terms and conditions shall govern. If there is no such written contract, then Seller shall sell such Products to Buyer only upon the terms set forth herein.

1. Price.
(a) The purchase price for the Products sold hereunder shall be Seller’s applicable prices in effect at the time of shipment. Prices in effect as of this date for the specific Products governed hereby are set forth on the attached quotation form. Seller has the absolute right to alter its prices and the terms and conditions of sale at any time for any reason upon thirty (30) days’ prior notice in writing or by telecommunication. All freight, storage, handling, packaging, insurance, taxes, duties and other charges relating to the Products so sold shall be arranged for the account of Buyer without any liability to Seller. Prices are quoted FOB point of shipment.

(b) Buyer shall pay Seller the amount of all taxes, excises or other charges (except taxes on or measured by net income) that Seller may be required to pay to any government (foreign, national, state or local) with respect to the production, sale or transportation of any Products delivered hereunder, except where the law expressly provides otherwise.

2. Minimum Order. Minimum order shall be $100 per line/$100 per order.

3. Rescheduling. The entire quantity shall initially be scheduled by agreement. However, product may be rescheduled by Buyer with thirty (30) days’ notice to Seller, in writing or by telecommunication, prior to scheduled ship date.

4. Delayed Shipments. If any work or shipment of the Products is delayed by or at the request of Buyer, Seller may demand payment based on the purchase price and the percentage of completion as determined by Seller, and payment covering Seller’s increased costs as a result of the delays.

5. Cancellation. Product may be cancelled without liability with prior written or telecommunicated notice to equal lead time of product but the Buyer is responsible for all special parts and assemblies on hand at the time of cancellation as well as any component parts exclusive to the Buyer’s product.

6. Payment. Satisfactory payment in full of all of Seller’s invoices rendered hereunder must be made within thirty (30) days from the date of the invoice. Any payment of the purchase price not paid by Buyer when due shall be assessed a late payment charge of 2% per month of the overdue payment from its due date until paid. In the event Buyer fails to make any payment pursuant to this or any other agreement between the parties hereto, or in case Seller shall have any doubt for any reason at any time as to Buyer’s financial responsibility, Seller may immediately suspend and or decline to make any further deliveries of products to Buyer except for cash in advance, whether or not orders have already been accepted by Seller and Seller may demand immediate payment in full for all product theretofore delivered. Buyer agrees to indemnify Seller and to hold it harmless from any and all claims and costs of any kind, including but not limited to, legal fees and costs which may be required to collect any overdue balances and interest on all overdue accounts shall be at the rate lawfully charged at the time by Seller.

7. Shipments. Seller shall diligently endeavor to fill and ship all orders to Buyer at the requested time of delivery, subject to Buyer’s choice of transport. In the absence of Buyer’s instructions, Seller will endeavor to select the most economical method of shipment in every case. Unless specifically stated to the contrary, partial shipments against customer schedule may be made.

8. Delivery. Delivery of the Products sold by Seller hereunder shall be made and title and all risks of loss thereto shall pass to Buyer immediately upon the loading of the Products on the transport carrier at Seller’s warehouse. The burden of proving when damage occurred shall be on Buyer. Seller does not assume responsibility for any damages growing out of, or owning to, any delays in delivery. Seller is not responsible for Products lost in transit. The Buyer is solely responsible for filing claims with carrier for any such losses. Claims for shortages in shipment, which are not chargeable to the carrier, must be reported within (10) days from receipt of merchandise.

9. Returned Products. Defective merchandise due to faulty material and/or workmanship is returnable for full replacement or credit on the following basis: No merchandise may be returned without authorization from Seller. When a request to return Product has been approved, a RETURNED PRODUCTS FORM will be sent to the customer giving necessary instructions to cover the merchandise. Merchandise returned must be identified as to original date of purchase, purchase order number and shipper’s name and address. Credit or replacement will be made at the option of the Seller, depending upon the reason and responsibility for the return. Merchandise made with special or modified parts and/or Products that have become obsolete are not returnable unless specific arrangements have been made for such return. Merchandise ordered incorrectly by Buyer may be accepted for return subject to a handling charge. All merchandise must be returned prepaid (except in the case of defective parts) and properly packaged. Merchandise damaged in transit due to inadequate package will be chargeable to the Buyer. All returns must be received within thirty (30) days of the receipt of authorization otherwise credit will be cancelled.

10. Allocation. In no event shall Seller be required to sell a greater number of Products than it shall have available or allocated for such purposes. If Seller is unable to supply the total demands for any of the Products, Seller shall have the right to allocate its available supply among its customers in such manner as Seller shall deem to be fair and equitable. IN NO EVENT SHALL SELLER BE OBLIGATED TO PURCHASE PRODUCTS FROM OTHERS IN ORDER TO ENABLE IT TO DELIVER PRODUCTS TO BUYER, NOR SHALL IT BE LIABLE FOR ANY DAMAGES OR CLAIMS ARISING THEREFROM, INCLUDING BUT NOT LIMITED TO INCIDENTAL AND/OR CONSEQUENTIAL AND/OR PUNITIVE DAMAGES, WHETHER OR NOT CAUSED BY OR RESULTING FROM THE NEGLIGENCE OR OMISSION OF SELLER.

11. Warranty; Certain Patent Matters; Disclaimer of Warranty; Exclusive Remedies.
(a) Seller warrants, for a period of one year from date of delivery, that the Products sold hereunder will, at the time of delivery: (i) conform to Seller’s applicable standard specifications for such Products in effect at the time of shipment or such other specifications as are expressly agreed upon by Seller and Buyer in writing; (ii) be adequately contained, packaged, and labeled; and (iii) conform to any promises and affirmations of fact made on the container and label. In the event that any such Products fail to conform to the foregoing warranty, Seller will, at its option, repair or replace such nonconforming Products, or credit Buyer for an amount not to exceed the original sales price of such Products. Shipping costs incurred in returning such nonconforming Products to Seller shall be borne by Seller, but Seller shall in no event be liable for any inspection, handling, or packaging costs incurred by Buyer in connection with such Products. Buyer’s negligence, misuse, improper installation, or unauthorized repair or alteration, shall void this warranty.

(b) Seller warrants that the Products delivered hereunder will infringe no claim of any patent covering the Products themselves. Seller does not warrant against infringement by reason of the use of such Products in combination with other articles or materials or in the practice of any process and Buyer assumes all responsibility for determining whether relevant patents exist covering such use, together with all risk and liability arising out of infringement of any such patents.

(c) THERE ARE NO EXPRESS WARRANTIES BY SELLER OTHER THAN THOSE SPECIFIED IN ARTICLES 11(a) AND 11(b). NO WARRANTIES BY SELLER (OTHER THAN A WARRANTY OF TITLE AS PROVIDED BY THE UNIFORM COMMERCIAL CODE) SHALL BE IMPLIED OR OTHERWISE CREATED UNDER ANY APPLICABLE LAW, INCLUDING BUT NOT LIMITED TO A WARRANTY OF MERCHANTABILITY AND A WARRANTY OF FITNESS FOR A PARTICULAR PURPOSE.

(d) THE REMEDIES SET FORTH HEREIN SHALL BE EXCLUSIVE. Buyer’s receipt of any Products delivered hereunder shall be an unqualified acceptance of, and a waiver by Buyer of any and all claims (including claims arising under the warranties specified in Articles 11(a) and 11(b)) with respect to, (i) such Products unless Buyer gives Seller notice of claim within one (1) year from date of shipment of such Products or (ii) within ten (10) days after Buyer receives written notice of any claim of patent infringement covered by Article 11(b). NO CLAIMS OF ANY KIND AGAINST SELLER, WHETHER AS TO PRODUCTS DELIVERED, OR FOR DELAYED DELIVERY OR NONDELIVERY OF PRODUCTS, AND WHETHER OR NOT BASED ON NEGLIGENCE OR WARRANTY, SHALL BE GREATER IN AGGREGATE AMOUNT THAN THE PURCHASE PRICE OF THE PRODUCTS IN RESPECT OF WHICH SUCH CLAIMS ARE MADE. IN NO EVENT WILL EITHER PARTY BE LIABLE FOR ANY SPECIAL, INDIRECT, INCIDENTAL, CONSEQUENTIAL OR PUNITIVE DAMAGES, WHETHER OR NOT CAUSED BY OR RESULTING FROM THE NEGLIGENCE OF, OR BREACH OF WARRANTIES BY, SUCH PARTY. Without limiting the generality of the foregoing, Buyer assumes all risk and liability for the results obtained by the use of any Products delivered hereunder in combination with other articles or materials or in the practice of any process, whether in terms of operating costs, general effectiveness, success or failure, and regardless of any oral or written statements made by Seller, by way of technical advice or otherwise, with respect to the use of such Products.

12. Disclaimer on Technical Advice of Seller.
(a) IT IS EXPRESSLY UNDERSTOOD THAT ANY TECHNICAL ADVICE FURNISHED BY SELLER WITH REFERENCE TO THE USE OF ITS PRODUCTS IS GIVEN GRATIS AND SELLER ASSUMES NO OBLIGATION OR LIABILITY FOR THE ADVICE GIVEN OR RESULTS OBTAINED, ALL SUCH ADVICE BEING GIVEN AND ACCEPTED AT BUYER’S RISK. WITHOUT LIMITING THE GENERALITY OF THE FOREGOING, THE BUYER ASSUMES ALL RISK AND LIABILITY FOR THE RESULTS OBTAINED BY THE USE OF ANY PRODUCTS IN COMBINATION WITH OTHER ARTICLES OR MATERIAL OR IN THE PRACTICE OF ANY PROCESS, WHETHER IN TERMS OF OPERATING COST, GENERAL EFFECTIVENESS, SUCCESS OR FAILURE, REGARDLESS OF ANY ORAL OR WRITTEN STATEMENTS MADE BY SELLER WITH RESPECT TO THE USE OF SUCH PRODUCTS BY WAY OF TECHNICAL ADVICE OR OTHERWISE.

(b) Buyer shall indemnify and save Seller harmless against any and all losses, damages, costs or expenses of any kind incurred by reason of any liability imposed by law upon Seller for damages, costs and expenses because of property damage or bodily injuries or death sustained or resulting from the sale, use, testing, or handling of the Products unless (i) caused solely by the gross negligence of Seller; and (ii) Buyer has notified Seller in writing of any third party’s claims or demands within fifteen (15) days after the Buyer received notice thereof and (iii) Seller still has sufficient legal recourse and Buyer has done nothing to prejudice Seller’s rights in contesting such claim.

13. Force Majeure. Seller will not be liable for its failure to perform hereunder due to contingencies beyond its reasonable control, including but not limited to, acts of God, fires, floods, wars, sabotage, riots, civil strife, accidents, labor disputes, lockouts or shortages (whether or not such are within Seller’s ability to settle), any governmental laws, ordinances, rules, regulations, action or inaction (whether valid or invalid including, but not limited to, priorities, requisitions, allocations and price adjustment restrictions), delay or inability to obtain supplies, raw materials, energy, products, equipment or transportation, and any other similar or different contingency. Seller shall have the right upon written notice to omit during the period of such contingency all or any portion of the quantity of the Products to be delivered during such period, whereupon the total quantity of the Products to be delivered hereunder shall be reduced by the quantity so omitted. If due to any such contingency Seller is unable to supply the total demands for any Products to be delivered hereunder, Seller will have the right to allocate its available supply among its customers in such manner as Seller shall deem to be fair and equitable. IN NO EVENT WILL SELLER BE OBLIGATED TO PURCHASE MATERIAL FROM OTHER THAN ITS REGULAR SOURCES OF SUPPLY IN ORDER TO ENABLE IT TO SUPPLY PRODUCTS TO CUSTOMERS HEREUNDER.

14. Assignment. Buyer’s rights under these Terms and Conditions of Sale and any right of Buyer to receive Products in exchange for payment evidenced on the reverse hereof may not be assigned or encumbered in any way except with the prior written consent of Seller.

15. Governing Law. The validity, interpretation and performance of the terms hereof shall be governed, construed, and interpreted in accordance with the laws of the State of South Carolina and the Federal Arbitration Act without giving effect to any choice or conflict of law provision or rule (whether of the State of South Carolina or any other jurisdiction) that would cause the application of the laws of any other jurisdiction. Neither course of performance, course of dealing or usage of trade shall be used to interpret, construe, qualify, explain or supplement any of these Terms and Conditions of Sale.

16. Entire Agreement; Modification and Waiver. This document, any attachments hereto, and the terms and conditions contained in any written agreement between Buyer and Seller constitute the entire understanding of the parties, contain all of the representations and agreements between them and supersede all previous agreements and representations between the parties with respect to the Products shipped hereunder. In the event of an inconsistency between this document and any other document (except a written contract executed by Seller) or understanding or course of dealing or usage of trade, this document shall govern. No modification or waiver of the terms hereof shall be binding upon Seller unless approved in writing by one of Seller’s authorized representatives, or shall be affected by the delivery of Product or the acknowledgment or acceptance of purchase order forms, invoices, shipping papers or other documents containing other or different terms whether or not signed by an authorized representative of Seller.