Sales Terms & Conditions

Electro Scientific Industries, Inc. 
13900 N.W. Science Park Drive
Portland, Oregon 97229, U.S.A.
Phone: 1.503.641.4141

SALES TERMS & CONDITIONS


Standard Terms and Conditions of Sale and Limited Warranty

The following terms and conditions of sale and limited warranty govern all purchases of systems, upgrades, and non-system items (“Products”) from Electro Scientific Industries, Inc. (“ESI”) and companies affiliated with ESI by Buyer (“Buyer” or “You”). If Buyer has entered into a contract directly with ESI for the supply of ESI Products, the terms of that contract shall supersede any terms herein which are inconsistent with that contract. For ordering parts and services, please refer to ESI Parts and Services Terms and Conditions.

1. AGREEMENT

Acceptance of Buyer’s purchase order is conditional upon Buyer’s assent to the terms and conditions printed herein. Buyer’s acceptance of any ESI system or other Product shall be conclusively deemed assent to the terms and conditions herein. ESI’s failure to object to any terms or conditions stated in Buyer’s purchase orders, forms or other communications from Buyer will not be a waiver of the provisions hereof and no other document, including Buyer’s terms and conditions of purchase, will be part of this transaction, unless specifically agreed to in writing by ESI.

2. PAYMENT TERMS

Unless otherwise agreed by ESI, payment terms are:

For U.S. domestic sales, at ESI’s option, either:

100%, net 30 days from shipment;
or  90%, net 30 days from shipment; 10% upon acceptance or net 90 days from shipment, whichever comes first.

For international sales, at ESI’s option, either:

100% wire transfer prior to shipment; or,  90% letter of credit due at sight; 10% letter of credit due upon acceptance or 90 days from shipment, whichever comes first.

ESI reserves the right to impose a late penalty fee of 1.5% per month for all past due balances. ESI also reserves the right to require C.O.D. payment, a letter of credit, or other security for payment if ESI determines that such terms are required to assure payment to ESI.

3. PRICES

Unless otherwise provided, all prices are ExWorks ESI’s place of business, INCOTERMS 2010, and prices are exclusive of shipping costs, insurance, and any applicable Taxes (defined below). All price quotations are valid for 30 days unless noted otherwise. Published list prices are subject to change without notice.

4. SHIPMENTS AND TITLE TRANSFER

All purchase orders are subject to acceptance by ESI. Unless otherwise provided on the attached acknowledgement, all shipments are Ex Works ESI’s place of business, INCOTERMS 2010. Title to all Products shall pass to the Buyer upon the availability of the Products to the carrier at point of shipment. ESI reserves the right to select the method and routing of transportation and the right to make delivery in installments unless otherwise specified at the time of order. ESI will provide estimated shipment dates upon acknowledgement of Buyer’s purchase order. Shipment dates on ESI quotations are approximate and may not be relied upon.
 
Buyer shall arrange air ride and temperature-controlled transportation where applicable. Buyer shall assume all risks of loss and responsibility for the cost of shipping and insurance, regardless of the fact that shipping or insurance may have been arranged by ESI on Buyer’s behalf. Any freight or delivery charges paid by ESI on shipments to Buyer will be passed on to Buyer, and shall be in addition to the price of goods. ESI has the right to cancel any order or to refuse or suspend shipment for Buyer’s failure to meet payment terms on any outstanding invoice.

5. ORDER CANCELLATION FOR CONVENIENCE, SHIPMENT HOLDS AND DAMAGES

A.   Holds  

Buyer may request a shipment hold with prior written consent from ESI. Buyer may request a shipment hold prior to thirty days from the shipment date listed on the ESI Order Confirmation (or otherwise mutually agreed upon shipment date) at no charge. Because hold Requests within thirty (30) days of shipment would damage ESI in an amount that is difficult to ascertain, Buyer agrees to pay ESI the following percentage of the purchase price as liquidated damages:  

Days before estimated shipping dates     Percentage of Product Face Value
0-14                                                                   5.0%                    
15-30                                                                 2.5%  

If a hold lasts for more than 120 days, ESI may cancel the order as of the date of the original hold request and Buyer shall pay the cancellation charge listed below as liquidated damages. Hold and cancellation charges will not exceed 100% of product face value. Buyer acknowledges that such liquidated damages are a reasonable forecast of the loss ESI will suffer upon a prolonged hold, that the damage due to a hold experienced by ESI would be difficult to ascertain, and that no other remedy would be adequate, convenient, or feasible.

B.   Cancellations  

Buyer may cancel a purchase order or reschedule a shipment without penalty if the cancellation or reschedule is made more than 90 days from the Estimated Shipping Date (as specified in ESI’s Order Verification or other communication). Within such 90 days, purchase orders canceled will be subject to one of the following cancellation charges:  

Days Before Estimated Shipping Dates      Percentage of Purchase Order Face Value Cancellation
30-0                                                                    100%
60-31                                                                    75%
90-61                                                                    50%

6. GOVERNMENT CONTRACTS

If any order by Buyer indicates that the purchase is being made for use under a U.S. government contract, those and only those terms and conditions that federal statute, regulation, or rule required in fixed price supply subcontracts covering standard commercial proprietary items and sold to the public shall be deemed incorporated herein by reference. Terms and conditions of the prime government contract that are not so required are not incorporated herein and shall be binding on ESI only if set forth in a separate written document signed by a duly authorized representative of ESI.

7. INSPECTION

Buyer shall examine each shipment of ESI Product immediately upon receipt and inform ESI of any shortage, visible defect or incorrect product shipments in writing within 7 days of receipt. If no discrepancies are reported by Buyer in writing within 7 days of receipt, the shipment shall be deemed delivered complete and defect free and Buyer may not dispute such shipment.

8. INSTALLATION

If ESI installs, the Buyer is responsible for providing facilities and utilities per the ESI site requirement guide prior to the arrival of the ESI installation team. In addition, the Buyer is responsible for moving the ESI system components to the installation site and providing the necessary facilities equipment to position it for assembly. All monitoring and controls of utilities are the responsibility of the Buyer. If installation is not performed within 30 days of delivery due to reasons within Buyer’s responsibility or control, the system will be deemed accepted.

9. ACCEPTANCE

The acceptance of systems which do not include custom solutions (applications, engineering, etc.) will be based upon a demonstration of successful running of system using its specific ESI System Acceptance Test (“SAT”). ESI Field Service Engineers (“ESI FSE”) will demonstrate the SAT, and Buyer shall cooperate with ESI FSE to facilitate the performance of the SAT. The system will be deemed accepted upon ESI’s successful demonstration of SAT. In case of an applicable custom acceptance requirement agreed by ESI (as noted in the final ESI quotation), in addition to SAT, Buyer shall perform the custom acceptance requirement without delay.

After successful demonstration of SAT and (if applicable) custom acceptance requirement, Buyer’s representative shall sign ESI’s Final Acceptance Record (“FAR”), indicating the start of the warranty period. Failure to sign the FAR shall not delay the commencement of the warranty period.

Notwithstanding the foregoing, unless Buyer has notified ESI of its rejection in writing within 60 days after shipment, Buyer will be deemed to have accepted the Product at the end of such 60-day period.

10. LIMITED WARRANTY

a. Warranty Period. For a new or remanufactured system to be installed by ESI FSE, the warranty period shall be one year from acceptance but in no event shall it exceed fourteen months from shipment. For upgrades, the warranty period is 90 days from acceptance.
b. During the Warranty Period, ESI warrants that:
1. all Products meet specifications published by ESI appropriate to the model and options purchased as of the shipping date or agreed in writing between Buyer and ESI;
2. all Products will be free from defects in materials and workmanship or defects due to design (other than any design specified by Buyer); and
3. The Product complies with all safety and environmental regulations and standards of the United States federal government in effect on the shipping date.
c. For any failure covered by this limited warranty, ESI shall repair or replace, at ESI’s option, the defective system or component. ESI will provide services during normal business hours (Monday through Friday, 8AM – 5PM local time). Additional charges apply for services scheduled during times other than normal business hours. Buyer shall promptly notify ESI of any failure that occurs during the Warranty Period and allow ESI FSE access to the ESI system in its usual working condition and environment for warranty repair or replacements. Failure to provide such notice or access shall relieve ESI of its warranty obligations.  When applicable, Buyer shall also allow ESI FSE to perform two preventive maintenance (PM) visits during the Warranty Period.
d. Repair or replacement of a defective system or its component is the sole and only remedy under this warranty. The replacement part may be a new or remanufactured part which is equivalent to new in performance. In case of replacing a defective component, ESI will warrant the replacement part for the remaining Warranty Period or hours carried by the original system.
e. During the Warranty Period, replacement parts will be shipped on a no-charge basis on condition that all defectives parts must be returned immediately upon receipt of replacement parts. Failure to return the defective parts promptly will result in an invoice for the full price of the replacement part.
f. Notwithstanding the above, ESI provides no warranties (a) on consumable items as identified by ESI; (b) on any system or portion thereof which is based on the Buyer’s design; (c) respecting any larger system of which the ESI Product is only a component; and (d) non-ESI supplied replacement parts.
g. This limited warranty is void if failure has resulted from:
1. Misuse, mishandling, accident or neglect, noncompliance with ESI specified system operating environment or operation specifications, abuse and misapplication;
2. Improper packing or handling of the system during relocation by Buyer;
3. Unauthorized modification to the system or part, attempts to install or de-install or perform unauthorized maintenance or repair by any person that is not ESI FSE; or
4. An act or event beyond ESI’s reasonable control and without ESI’s fault or negligence, including but not limited to fires, explosions, floods, earthquakes, power outage or inappropriate transportation, acts of God, war or terrorism.
h. Temperature-controlled and air ride transportation is required for all ESI Products where applicable. Buyer is responsible for any damages caused by inappropriate transportation.
i. THIS WARRANTY IS IN LIEU OF ALL OTHER WARRANTIES, EXPRESS OR IMPLIED, INCLUDING WARRANTIES OF MERCHANTABILITY OR OF FITNESS FOR A PARTICULAR PURPOSE. BUYER’S EXCLUSIVE REMEDY FOR BREACH OR WARRANTY IS REPAIR OR REPLACEMENT, AT ESI’S OPTION. ANY LAWSUIT BY BUYER AGAINST ESI, ITS OFFICERS, DIRECTORS, EMPLOYEES, OR AFFILIATES, ARISING OUT OF OR RELATING TO WARRANTY CLAIMS REGARDING THE SUBJECT PRODUCT, SHALL BE FILED WITHIN TWO YEARS FROM SHIPMENT OF THE SUBJECT PRODUCT BY ESI.

11. LIMITATION OF LIABILITY

IN NO EVENT WILL ESI BE LIABLE FOR LOSS OF REVENUE, PROFIT, OR LOSS OF DATA, SUBSTITUTE GOODS, BUSINESS INTERRUPTION, OR FOR ANY SPECIAL, INDIRECT, CONSEQUENTIAL, INCIDENTAL OR PUNITIVE DAMAGES, HOWEVER CAUSED AND REGARDLESS OF THE THEORY OF LIABILITY, WHETHER ARISING OUT OF THE USE OF OR INABILITY TO USE PRODUCTS OR OTHERWISE AND EVEN IF ESI OR ITS SUPPLIERS OR LICENSORS HAVE BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES. IN NO EVENT SHALL ESI’S OR ITS SUPPLIERS’ OR LICENSORS’ LIABILITY TO BUYER, WHETHER IN CONTRACT, TORT (INCLUDING NEGLIGENCE), BREACH OF WARRANTY, OR OTHERWISE, EXCEED THE PRICE PAID BY BUYER FOR THE PRODUCT THAT GAVE RISE TO THE CLAIM. BECAUSE SOME STATES OR JURISDICTIONS DO NOT ALLOW LIMITATION OR EXCLUSION OF CONSEQUENTIAL OR INCIDENTAL DAMAGES, THE ABOVE LIMITATION MAY NOT APPLY TO YOU.

12. PATENT INFRINGEMENT

ESI shall defend any lawsuit brought against Buyer to the extent such lawsuit is based on a claim that any Product furnished by ESI to Buyer infringes any patent of the United States, provided that ESI is notified promptly in writing and given full and complete authority, information, and assistance for the defense of the lawsuit. ESI shall not be responsible for any compromise made without its consent or for damages arising out of any suit which Buyer has not given ESI timely opportunity to defend. If an infringement claim is made or if ESI believes a claim is likely to be made, ESI may at its option: (a) modify the Product so that it becomes non-infringing, or (b) remove the Product and refund to Buyer the purchase price less a reasonable allowance for use. ESI shall not have any liability to Buyer under any provision of this clause if: (a) the claim is based upon the interconnection or use of the Product in combination with Product or other devices not made by ESI; (b) the claim was based upon use of the Product in any manner for which it was not designed or recommended by ESI; or (c) the infringement arises from a design or specifications provided to ESI by Buyer.

THIS SECTION 12 SETS FORTH ESI’S ENTIRE LIABILITY AND BUYER’S SOLE AND EXCLUSIVE REMEDY FOR INFRINGEMENT CLAIMS RELATING TO ESI PRODUCT OR COMPONENTS.

13. SOFTWARE LICENSE

Any ESI and third party software or firmware (collectively “Software”) delivered by ESI to Buyer hereunder is licensed, not sold. ESI grants to Buyer a non-exclusive, nontransferable license to use the Software only in executable object code and only for the purpose of operating the Product. Buyer may not modify, adapt, translate, reverse engineer, decompile, disassemble or create a derivative work based upon the Software or allow other to do so except and only to the extent that such activity is expressly permitted by applicable law notwithstanding this limitation. Buyer shall not make or distribute unauthorized copies of the Software, and shall acquire no rights of ownership in the Software. Title to and ownership of the Software and all extensions, enhancements and modifications thereof shall remain at all times with ESI and/or its licensors.

14. INTELLECTUAL PROPERTY OWNERSHIP

Subject to any license rights expressly granted herein, ESI retains all right, title and interest in all of its patents, trade secrets, trademarks, copyrights, software, inventions, technology, ideas, concepts, know-how, tooling, techniques and other proprietary materials, intellectual property and confidential information.

15. CONFIDENTIALITY

Buyer understands and agrees that ESI Products embody, utilize or otherwise contain ESI confidential and proprietary information and trade secrets (“Confidential Information”). Certain of the Confidential Information are apparent upon visual inspection of the Products. Other Confidential Information can only be discerned upon observation of the operation or the disassembly of the Products, or by reverse engineering. Except to the extent and in the circumstances expressly provided by law, Buyer agrees, represents and warrants that it shall not (or permit others to) reverse engineer, manufacture, decompile, or create derivative works of, any Products without ESI’s prior express written consent.

Buyer shall not allow any third party to take possession of or to inspect, observe any operation of, or disassemble any Product or any portion of thereof, or take any photograph or recording of the Product or the operation thereof. If as a result of applicable law, Buyer is entitled to decompile the Product in order to obtain information necessary to render the Product interoperable or compatible with other products or software (“Permitted Objective”), Buyer shall first notify ESI of such requirements and give ESI the opportunity to provide the information necessary to achieve such Permitted Objective without undertaking such action. If such information is provided, Buyer must use it to achieve the Permitted Objective only. Buyer shall use reasonable care, and not less than the same care it exercises with respect to its own confidential and proprietary information, to protect the Confidential Information against unauthorized use, loss, theft or disclosure. Buyer shall not disclose or describe to any third party, directly or indirectly, under any circumstances or by any means, any Confidential Information without ESI’s prior written consent. Buyer will not be in breach of this section if disclosure of Confidential Information is made pursuant to subpoena or other compulsory judicial or administrative process, provided that Buyer promptly notifies ESI of such subpoena or other compulsory process, and provides reasonable assistance, so that ESI may seek a protective order or take such other action it deems necessary to protect its interest.

“Confidential Information” does not include any information concerning ESI that Buyer can demonstrate by written evidence (a) is now or becomes generally known to the public by lawful means and without breach of any confidentiality obligation; (b) is disclosed by Buyer with ESI’s prior written consent to unrestricted disclosure; (c) was known to and reduced to writing by Buyer without use of any Confidential Information prior to the date of this Agreement; (d) is independently developed by Buyer without use of any Confidential Information; or (e) is lawfully obtained by Buyer from a third party.

16. FORCE MAJEURE

ESI’s performance of any obligation hereunder shall be excused by any event beyond its reasonable control, including without limitation inclement weather, strikes, governmental laws, regulations or interruptions thereof, war, equipment breakdown, interruption of transportation, and delayed deliveries to ESI from ESI’s suppliers which delays or prevents ESI’s performance or makes performance commercially impractical due to unreasonable difficulty, expense, or risk of injury or loss.

17. EXPORT CONTROL

Buyer shall at all times comply with the United States laws and regulations governing export control. Buyer shall not use, lease, or sell any ESI Product in any country, or to any purchaser or lessee in any country, other than the country of destination specified in Buyer’s order, except in a manner expressly permitted by such laws and regulations.

18. TAXES AND DUTIES

Unless provided otherwise, prices do not include federal, state, local, or foreign taxes, charges, fees, imposts, levies, duties, or other assessments of any kind or nature imposed by any government (“Taxes”). Buyer shall be responsible for payment of all Taxes on the sale of the Products.

19. INDEMNIFICATION

Buyer shall indemnify and hold ESI harmless, including costs and attorney’s fees, from any claims by employees, distributors, or customers of Buyer arising from the sale, lease or use of the Product sold by ESI or of other systems of Buyer which incorporates this Product, unless the claim arises from the sole negligence of ESI.

20. GOVERNING LAW

If both the Buyer and the System(s) are located in the Peoples Republic of China:  The validity, interpretation and performance of these terms and conditions and any purchase made hereunder shall be governed by the laws of the Peoples Republic of China.  All disputes in connection with this contract or the execution of this contract shall be settled through negotiations. In case no settlement can be reached through negotiations, the dispute will be submitted for arbitration to The China International Economic and Trade Arbitration Commission (CIETAC) for arbitration, which shall be conducted in accordance with the CIETAC arbitration rules in effect at the time of the submission. The arbitration shall take place in Shanghai.

For all other sales:  The validity, interpretation and performance of these terms and conditions and any purchase made hereunder shall be governed by the laws of the State of Oregon, USA, without regard to Oregon conflict of law principles. Except to the extent that invoking the jurisdiction of another court is necessary to enforce (a) any security interest in Products or (b) any judgment or order entered in Oregon, any legal action arising out of this purchase and sale shall be prosecuted exclusively in Portland, Oregon, USA. Both parties hereby submit to the jurisdiction of the courts located in Portland, Oregon over each of them personally in connection with such litigation, and waive any objection to venue in such courts and any claim that such forum is an inconvenient forum.

21. GENERAL

These terms and conditions constitute the entire agreement between ESI and Buyer. No modifications, changes, additions or amendment to the terms and conditions or promises, representation, or warranties that differ in any way from these terms and conditions herein shall be binding on ESI unless such modifications, changes, waivers, additions or amendments are in writing and signed by a duly authorized representative of ESI.

The waiver of any breach or default hereunder shall not constitute the waiver of any subsequent breach or default. In the event of any default by Buyer, ESI may decline to make further shipments. If ESI elects to continue to make shipments, such action shall not constitute a waiver of any default by Buyer or in any way affect ESI’s legal remedies for such default.

If any term or condition hereof shall to any extent be invalid or unenforceable, the remainder of these terms and conditions shall not be affected thereby and each term and condition shall be valid and enforced to the fullest extent permitted by law.

Buyer shall not assign the performance obligations or any rights hereunder without the prior written consent of ESI. Subject to the foregoing, the terms and conditions shall bind and inure to the benefit of the respective parties hereto and their successors and assigns.


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