Roy Manufacturing Terms and Conditions of Sale

1. AGREEMENT.  The following terms and conditions govern all quotes, requests, and orders for Roy Manufacturing (“Roy”) products, services and materials, whether made via the internet, telephone, in person or in writing.  These terms and conditions, together with Buyer’s Purchase Order, represent the final and complete Agreement for Buyer’s purchase of the goods and services (“Goods” and “Services”) that Roy will provide and supersede all prior discussions, correspondence, negotiations, and proposals.  Buyer’s preprinted terms, including those in Buyer’s Purchase Order, if any, shall not apply to the Agreement to the extent they add to, negate or conflict with these terms and conditions.  This Agreement may only be modified by a writing signed by both parties.

2. PRICE AND PAYMENT.  Buyer shall pay Roy the purchase price within 30 days, after the date of issuance of Roy’s invoice.  Unless expressly stated otherwise in writing by Roy, the purchase price excludes all charges and expenses connected to shipment of the Goods to Buyer, and all taxes and customs duties of any kind that either party is required to pay with respect to the sale of the Goods and Services covered by this Agreement but includes packing costs.  Roy also reserves the right to require payment in advance or COD, or otherwise modify credit terms, in the event of payment default.

3. TITLE AND RISK OF LOSS.  Delivery shall be FCA Roy’s dock (free carrier, Incoterms 2000).  Title to and full risk of loss for Goods (including transportation delays and losses) passes to Buyer upon delivery, as defined in Incoterms 2000, regardless of whether title has passed to Buyer, transport is arranged or supervised by Roy, or start-up is carried out under the direction or supervision of Roy.  Loss or destruction of the Goods or injury or damage to the Goods that occurs while the risk of such loss or damage is borne by Buyer does not relieve Buyer of its obligation to pay Roy for the Goods.

4. DELIVERY AND DELAYS.  Roy shall make commercially reasonable efforts to meet quoted delivery dates, which are estimated based on conditions known at the time of quotation.  Roy shall not be liable for any nonperformance, loss, damage, or delay due to events or circumstances beyond Roy’s reasonable control.

5. LIMITED WARRANTY.  Roy warrants as follows: (i) the Goods will be free from defect in material and workmanship; and; (ii) the Services will be performed in a good and workmanlike manner.  Buyer must report any claimed defect in Goods or Services in writing to Roy within five (5) days from the day the Goods are received by Buyer.

6. WARRANTY EXCLUSIONS/LIMITATIONS.  Roy is not liable under the warranty set forth above to the extent a defect or failure is caused by: (i) repair, alteration or modification of Goods by persons other than Roy or its designee without Roy’s prior written approval; (ii) normal wear and tear; or (iii) Buyer’s failure to properly ship, store, install, operate or maintain the Goods in

accordance with good industry practices or recommendations or instructions of Roy.

ROY MAKES NO OTHER WARRANTY OF ANY KIND WITH RESPECT TO THE GOODS OR SERVICES.  ALL OTHER WARRANTIES, EXPRESS OR IMPLIED, INCLUDING, BUT NOT LIMITED TO, ANY WARRANTY AGAINST INFRINGEMENT AND THE IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PURPOSE, ARE HEREBY DISCLAIMED.

7. LIMITATION OF LIABILITY.  Roy shall in no event be liable for any consequential, incidental, indirect, special or punitive damages arising out of the Agreement, or out of any breach of its obligations hereunder, or out of any defect in, or failure of, or malfunction of the Goods or Services, including but not limited to, claims based upon loss of use, lost profits or revenue, interest, lost goodwill, work stoppage, impairment of other equipment, environmental damage, loss by reasons of shutdown or non-operation, increased expenses of operations, cost of purchase of replacement equipment or claims of Buyer or its customer or any other party for service interruption whether or not such loss or damage is based on contract, tort

(including negligence and strict liability) or otherwise and whether or not Roy was advised of the possibility of such damage.

8. DISPUTE RESOLUTION.  The Contract shall be governed by the laws of the State of Oregon, USA, exclusive of its conflicts of laws principles.  Any disputes arising out of this Contract that cannot be informally resolved shall be adjudicated exclusively in Multnomah County, Oregon, USA, in any court of competent jurisdiction.

9. CANCELLATION.  Buyer may cancel an order at any time prior to the scheduled shipping date as specified on the purchase order or purchase order acknowledgment by giving written notice of cancellation to Roy.  All cancellations are subject to a charge equal to Roy’s cost of performance up to the date of receipt of the cancellation notice, including labor, overhead and materials.

10. SEVERABILITY.  If any provision of this Agreement is deemed to be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions will not in any way be affected or impaired thereby.