Purchase Order Agreement

TERMS AND CONDITIONS OF PURCHASE OF GOODS AND SERVICES

Powell Industries Inc. (“Powell”) and its affiliates (i.e., PII or the Powell affiliate) is listed in the accompanying Purchase Order or agreement, and referred to herein as “Buyer” or “Powell Industries Inc.”.

Notice - By accepting or shipping any part of this Purchase Order, or by performance of the Services by Supplier, Supplier agrees to the following terms and conditions (the “Agreement”):

1. Terms of Agreement; Order of Precedence.

This Agreement contains the only terms which govern the purchase by Powell or its affiliates, or by Powell Industries on behalf of its affiliates, of Product described on Purchase Orders and sold by Supplier. Powell Industries and Supplier are sometimes herein referred to singly as “Party” or collectively as “Parties.” This Agreement supersedes all previous and contemporaneous agreements and understandings between the Parties. The Parties intend for the express terms and conditions contained in this Agreement to exclusively govern and control each of the Parties' respective rights and obligations regarding the manufacture, purchase and sale of the goods and/or services, as described in a Purchase Order, sourcing agreement, or statement of work (hereinafter referred to as “Products” or “Services,” as applicable), and the Parties’ agreement is expressly limited to such terms and conditions. Notwithstanding the foregoing, if any terms and conditions contained in a Purchase Order conflict with any terms and conditions contained in this Agreement, the applicable term or condition of this Agreement will prevail and such contrary or different terms will have no force or effect. Except for such contrary or different terms, the terms and conditions of all Purchase Orders are incorporated by reference into this Agreement for all applicable purposes hereunder. Without limitation of anything contained in this paragraph, any additional, contrary or different terms contained in any Confirmation or any of Supplier’s invoices or other communications, and any other attempt to modify, supersede, supplement or otherwise alter this Agreement, are deemed rejected by Buyer and will not modify this Agreement or be binding on the Parties unless such terms have been fully approved in a signed writing by authorized representatives of both Parties. Notwithstanding anything herein to the contrary, if a written contract signed by both parties is in existence covering the sale of the Products and/or Services covered herein, the terms and conditions of such contract shall govern this transaction.

2. Ordering.

Ordering of Products shall be by Purchase Orders on Powell Industries order forms and change orders thereto (collectively the “Purchase Documents”). All orders shall be deemed accepted by Supplier unless Powell Industries receives a written objection thereto within 5 days after Supplier’s receipt of such orders. No variation in any of the terms, conditions, deliveries, prices, quality, quantity, and specifications of Buyer’s Purchase Orders, irrespective of the wording of Supplier’s acceptance, will be effective without Buyer’s written consent. The shipment by Supplier of any part of an Order shall be Supplier’s agreement to all provisions of the Purchase Order without variation or exception.

3. Order Changes and Cancellation.

Powell Industries may, without incurring liability for additional or increased costs: (a) change the delivery destination for the Product(s); and/or (b) change or terminate the Purchase Orders, in whole or in part. Upon receipt of such notice, Supplier shall, unless the notice directs otherwise, immediately discontinue the work under the Purchase Order and the placing of orders for materials, facilities and supplies for the work under the Purchase Order, and shall make every reasonable effort to procure cancellation of all such existing orders or contracts upon terms satisfactory to Powell Industries. Supplier shall thereafter do only such work as may be necessary to preserve and protect work already in progress. Powell Industries reserves the right at any time to make changes in any one or more of the following: (a) specifications, drawings and data incorporated in this order where the materials to be furnished are to be specially manufactured for Powell Industries; (b) methods of shipment or packing; (c) place of delivery; and (d) time of delivery. If any such changes cause an increase or decrease in the cost of or the time required for performance, an equitable adjustment may be made in the price for the material or delivery schedule, or both, as long as Supplier provides prior notice to and receives approval from Powell Industries for such adjustment. Any claim by Supplier for adjustment under this paragraph shall be deemed waived unless asserted in writing within 10 days of notification of the change. If Buyer terminates a Purchase Order for any reason, Supplier’s sole and exclusive remedy is payment for the Product or Services received and accepted prior to that termination. Price increases or extensions of time for delivery shall not be binding on Powell Industries unless agreed to in writing, signed by Powell Industries. In the event that Buyer becomes aware of any patents, copyrights, trademarks, trade names or any other intellectual property rights of a third party that Buyer reasonably believes the Product(s) infringe upon, Buyer may change or terminate such Purchase Order (s) in whole or in part without incurring liability and shall receive a refund if payment has already been made. The option in the foregoing sentence, regardless of whether it is invoked, is not a waiver of any other terms and conditions of this Agreement. In the event an Order is cancelled, and the Product has already been labelled with Powell Industries Marks (as defined below), then Supplier must remove Powell Industries Marks prior to reusing, reselling or otherwise disposing of the Products.

4. Pricing.

No increase in pricing of Products or Services is effective, whether due to increased material, labor or transportation costs or otherwise, without the prior written consent of Buyer. In the event Supplier charges a different buyer a lower price for the Product), or for similar products in the market, or if the cost of components or raw materials decrease; Supplier must immediately apply the lower pricing to Powell Industries’ Products. Unless otherwise specified in the Purchase Order, the price includes all packaging, transportation costs to the delivery point indicated in the Purchase Order or in the applicable agreement, insurance, customs duties, tariffs, fees, and applicable taxes.

5. Packaging Charges.

Powell Industries allows no charge for boxing, packing, crating or additional line items on Supplier’s invoice, unless agreed to in writing.

6. Buyer’s Routing Guide. 

For domestic shipments, Supplier shall adhere to Buyer’s Transportation Routing Guide (“Routing Guide”). Buyer reserves the right to modify, supplement, or change the Routing Guide at any time. If Supplier does not ship the Products in accordance with the Routing Guide, then Buyer will not be obligated to pay for the cost of transportation to Buyer’s facility, unless Supplier receives prior written authorization. At no time does Buyer authorize “shipping and handling” or other similar miscellaneous fees to be added to the invoice.

7. Expedited Shipping Requests.

If, and to the extent that, Purchase Orders from Powell Industries request a shipping date on an expedited basis (inside of the established lead time), Supplier shall advise Powell Industries within 2 business days after receipt of such Purchase Order as to whether it can comply therewith, but in any event will use its best efforts to ship such orders as expeditiously as possible.

8. Timely Delivery.

(a) Time is of the essence for all deliveries of Products and Services. Supplier shall use its best efforts to timely deliver Products as set forth in the Purchase Documents, it being understood that Powell Industries expects and anticipates a timely delivery rate of not less than 100% in respect of all Product Orders. If less than 98% of deliveries are made on a timely basis, or if deliveries are not made as specified in the Purchase Order, then Powell Industries reserves the right to cancel any Purchase Order or any unfilled portion thereof. Powell Industries reserves the right to cancel or postpone deliveries of any of the material which is not shipped to Powell Industries specified place of delivery at the time specified therefor. (b) If applicable, Supplier shall provide the Services to Buyer as described and in accordance with the Purchase Order.

9. Quality Expectation.

Supplier understands that Powell Industries expects that Supplier shall maintain the quality of Products ordered hereunder such that defects in respect thereof shall not exceed 20 parts per million for components or finished goods.

10. Inspection.

Powell Industries has the right, but not the obligation, to inspect Product.

11. Incoming Non-Conforming Products.

An administrative fee for each non-conforming Product as determined by Powell Industries will be automatically charged back to the Supplier. Non-conforming Products are goods that do not conform, in all material respects, to the specifications, standards, drawings, samples, descriptions, quality requirements, performance requirements, and/or fit, form and function requirements furnished, specified or approved by Powell Industries for the Products, and as specified in the Purchase Order. The charge back rate will be $250 for each defective material report (DMR) written plus additional charges, such as sort, rework, returned freight, and line down. Charges will be set-off as debits on the next payment due. Powell Industries reserves the right to reject or accept any non-conforming Products. Rejected non-conforming Products shall be returned at Supplier’s expense, including transportation charges, subject to the requirements of sections 12 and 13.

12. Rectifying Non-Conformance. 

Supplier has the following options (subject to Powell Industries’ written approval) with respect to Products deemed by Powell Industries to be defective, or found to be non-conforming: (a) Send replacement parts immediately; (b) Provide personnel to sort the defective material; (c) Use a local temp agency specified by Powell Industries plant to sort the defective material; (d) Use a Powell Industries plant-approved third party to rework the material; or (e) Powell Industries may sort, rework, and undertake any other non-value-added activity at a minimum rate of $100.00 per hour. If non-conforming Product is returned by Powell Industries to Supplier within one year of the date of delivery to Powell Industries, then Supplier shall give Powell Industries an appropriate credit or refund therefor.

13. Compliance with Purchase Order. 

The Parties recognize that Powell Industries has made, and will make, a significant investment in time and monies in an effort to build a business based upon sales of the Products, and that the reliable and timely delivery of Products by Supplier to Powell Industries is critical to the success of Powell Industries’ business plans. Therefore, in addition to such other rights and remedies available to Powell Industries hereunder, if due to Supplier’s fault, Supplier fails to perform in accordance with the Purchase Order (for example, untimely delivery, failure to deliver Purchase Order quantity, non-conforming Products, and the like), then Supplier shall be liable (and/or reimburse Powell Industries, as the case may be) for all actual liabilities, damages, costs and expenses incurred by Powell Industries, if applicable, in connection with such non-performance, including without limitation, the cost of expedited delivery as may be requested by Powell Industries and/or the cost of acquiring substitutes for Product(s), if any. Powell Industries agrees to discuss any situation that might incur liabilities with Supplier to determine appropriate course of action. Delivery or payment for Products shall not constitute Powell Industries’ acceptance of the Purchase Order.

Powell Industries reserves the right to reject all or any portions of a shipment containing defects or non-conformances after a reasonable opportunity to inspect.

14. Training.

Supplier shall furnish Buyer at no cost to Buyer such training, technical/ engineering support for new product design, and/or development as Buyer may reasonably request.

15. Intellectual Property License.

Powell Industries and its affiliates have certain valuable intellectual property, and own all right, title and interest in and to its trademarks and trade names, and any closely related variations, including any and all common law rights. If Supplier is labelling the Product with the Powell Industries logo or name, including a logo or name of any of Powell Industries’ affiliates, Powell Industries hereby grants to Supplier a limited, non-exclusive, royalty-free license for the term of this Agreement to use the name “Powell Industries,” or the name of its affiliates that are purchasing Products from Supplier, the logo of Powell Industries or its affiliates, and any trademarks or trade names or other intellectual property Page 2 of 7 owned by Powell Industries or its affiliates (collectively the “Powell Industries Marks”) solely on Product(s); provided that: (a) Powell Industries’ packaging and branding guidelines are followed; (b) samples of such use are first furnished to Powell Industries; and (c) Powell Industries first approves such use in writing. Supplier shall not be required to further furnish such samples after obtaining such approval if Supplier’s continued use of the Powell Industries Marks conforms to such approval. Any variation by Supplier from such approved use must be submitted to Powell Industries for written approval. Except for the limited rights expressly granted to Supplier hereunder, all rights with respect to the Powell Industries Marks, and other intellectual property owned or used by Powell Industries are reserved to Powell Industries and shall not be used by Supplier without Powell Industries’ prior written consent.

16. Use of Marks.

Permitted uses of the Powell Industries Marks under this Agreement shall inure exclusively to the benefit of Powell Industries for trademark and all other purposes. Supplier shall not at any time or in any manner use the Powell Industries Marks on or in connection with sales of Product(s) (whether on the Products themselves, packaging, promotional matter or otherwise) to persons or entities other than Powell Industries.

17. Material Furnished to Supplier.

All material, drawings, plans or specifications supplied by Powell Industries to Supplier or specifically paid for by Powell Industries, including but not limited to tooling, fixtures and templates, shall be: (a) the property of Powell Industries; (b) subject to removal at any time upon demand by Powell Industries, without additional cost; (c) used only in filling orders from Powell Industries; (d) kept separate from other materials or tools; and (e) clearly identified as the property of Powell Industries. At Powell Industries’ request, Supplier shall insure such inventory of Powell Industries’ property with loss payable to Powell Industries, with an insurer reasonably satisfactory to Powell Industries without a deductible or self-retention, as reasonably set by Powell Industries for the full replacement value of such property. Supplier assumes all liability for loss or damage, with the exception of normal wear and tear, and agrees to supply detailed statements of inventory at monthly intervals, or as otherwise agreed upon. All confidential information furnished to or received by Supplier shall be and remain Powell Industries’ exclusive property and shall not be used by Supplier for the benefit of any person or entity other than Powell Industries. Confidential Information shall include, but is not limited to, product and business information of a confidential and proprietary nature such as, by way of example, manufacturing processes, proprietary design, tooling and process concepts, component and material requirements, specifications, quality testing issues and test results, pricing, as well as descriptive information concerning business plans and operations of or contemplated by Powell Industries.

18. Printed Work.

If this is a Purchase Order for printed matter, then all artwork used in producing this or any future printing work is the property of Powell Industries. Upon completion of the job, Supplier will promptly return artwork. Supplier further agrees to deliver all or part of such material to Powell Industries promptly upon request and in case of loss or damage, to make replacement at Supplier’s expense.

19. Performance Warranty.

If applicable, Supplier shall perform any and all Services diligently and in a good and professional manner, using good quality materials, equipment and workmanship, sufficiently trained personnel to complete the Services in a safe and timely manner, and in accordance with generally recognized industry standards for similar services, which does not unduly interfere with the operation of Powell Industries. Supplier also agrees to abide by any safety guidelines provided to it, if performing Services at one of Buyer’s or Buyer’s affiliates’ facilities. If Buyer gives Supplier notice of noncompliance pursuant to this Paragraph, Supplier shall, at its own cost or expense, promptly repair or re-perform the applicable Services.

20. Warranty.

(a) Supplier warrants to Powell Industries that all materials are and shall be of merchantable quality new (not used or reconditioned), are and shall be free from defect in materials and workmanship, meet the Product specifications, and shall be fit for the particular purpose for which they are ordered or to be used by the consumer. Supplier hereby relieves Powell Industries of all duty, without exception, to inspect Product. Further, all Products will be free and clear of all liens, security interests or other encumbrances, and not infringe or misappropriate any third party’s patent or other IP rights. Notwithstanding any usage of trade or course of dealing between the Parties, Supplier’s liability for breach of any warranty, express or implied, shall include: (1) replacement of defective materials (including labor costs for removal of defective Products and replacement of new Products, at Powell Industries’ option); (2) refund of the purchase price; and (3) any general, special or consequential damages proximately caused by the breach of warranty. There are no exclusions, limitations or disclaimers of warranty. Warranty shall run to affiliates, subsidiaries, successors, assigns, customers and users of Powell Industries’ products. (b) Supplier agrees to promptly replace or refund any product found to be defective within the warranty period (“Warranty Period”), without any charge to Powell Industries. If no warranty period is listed for the Product in a Sourcing Agreement, the Warranty Period is at least 3 years from the end customer install date, or the Supplier warranty applicable to the Product, whichever is longer. Supplier will be responsible for all transportation costs associated with the repair of the product. If epidemic failure (systemic issue related to hardware or software) is found, as provided in Section 21 below, Supplier agrees to repair or exchange the product at their expense, including all costs associated with the repair or exchange. Supplier agrees to repair product out of warranty at the request and expense of Powell Industries. (c) All warranties will survive the termination of this Agreement.

21. Epidemic Failure.

Epidemic Failure means the occurrence, at any time during the Warranty Period, of the repeat failure of a Product over time, having the same root cause, at a rate deemed by Powell Industries to be an Epidemic Failure. In the event of an Epidemic Failure during the Warranty Period that does not arise solely from Supplier’s non-compliance with Buyer’s specification, then (i) Buyer shall have the option of requiring Supplier to issue an immediate return material authorization (“RMA”) related to such Product for the affected quantities of such Product; and (ii) the following costs and expenses incurred by Buyer as a result of the Epidemic Failure shall be borne by Supplier: the costs of repair or replacement of the affected product, the shipping and transportation costs for the affected Product, costs to re-inspect or test 100% of the rejected lots of batches/sorting costs, and removal or reinstallation expenses, including and without limitation, labor costs or expenses, and any other reasonable Page 3 of 7 expenses incurred by Powell Industries in connection with the Epidemic Failure.

22. Product Recall.

If Supplier’s Product is the subject of a Consumer Product Safety Commission (“CPSC”) mandated product recall or is deemed to be a product hazard by a reputable testing laboratory (such as UL or ETL), or loses its certification or listing by such agency(s), Supplier shall bear all costs associated with compliance with the CPSC’s product recall or any corrective action required by the testing laboratory.

23. Root Cause Analysis.

In the event of an Epidemic Failure or Product Recall, as described in Sections 21 and 22 above, Supplier shall use its best efforts to (i) identify the root cause of any such product failure or non-conformance (“Defect”) of any product supplied by Supplier to Powell Industries and (ii) propose a resolution, fix solution, or other acceptable and reasonable remedy to correct or eliminate the Defect. If Supplier refuses or unreasonably delays its response to a notification from Powell Industries of a Defect, then Supplier shall be liable to Powell Industries for all costs associated with the product failures, including the costs associated with replacing the defective products, including labor and shipping costs, and the costs of an independent laboratory hired by Powell Industries to examine the failed Products.

24. Insurance.

Without limiting the obligations of Supplier under Section 25 below (Indemnification), Supplier shall maintain in effect with a U.S. insurer reasonably satisfactory to Powell Industries, beginning on or before the first shipment under a Purchase Order and until at least six (6) years after the last shipment under this order, a minimum of US$2,000,000 on an occurrence basis, US$4,000,000 on an aggregate basis, and umbrella excess insurance of at least US$5,000,000, with no deductible or self-retention in products liability. Supplier will notify Powell Industries at least 30 days in advance of any cancellation or material change in coverage. In addition, the policy must have an endorsement stating that Powell Industries Inc. is named as an Additional Insured on the relevant policies. An insurance certificate evidencing such insurance shall be delivered to Powell Industries at contract signing and automatically upon each renewal. If Supplier’s employees or other representatives are required to be on Powell Industries’ premises, Supplier shall carry and furnish Powell Industries with certificates of insurance for comprehensive general liability, automobile liability and workmen’s compensation insurance. Such insurance shall have bodily injury limits of at least US$1,000,000 per occurrence, US$2,000,000 aggregate and property damage limits of at least US$250,000. The workers’ compensation policy must contain a waiver of subrogation endorsement in favor of Powell Industries Inc., or the equivalent thereof if present on Powell Industries’ premises outside of the U.S.

25. Indemnification.

(a) General Indemnification.

Supplier shall defend, indemnify, and hold harmless Powell Industries, its affiliates, officers, directors and employees against, and from all claims and litigation, liability, loss, damages, demands, judgments, or expense (including without limitation attorneys’ fees, experts, and statutory and non-statutory costs) arising: (i) under any strict liability or negligence claims premised on either an actual or alleged defect in the Products; (ii) from any damage to property or injury or death to persons, allegedly or actually caused by the Product(s), whether or not any defect was discoverable by Powell Industries; (iii) from any breach of Supplier’s representations or warranties; (iv) from any violation of any U.S. Consumer Protection Legislation; (v) from any antitrust or unfair trade practices; (vi) from any civil, criminal, administrative or other action brought or taken by a government agency or entity, relating to the Product(s) or any part thereof; or (vii) from damages or penalties of any sort arising from Supplier's failure to comply with any hazardous substances restrictions; (viii) out of injury to or death of any person or on account of damage to property, including the loss of use thereof or any other claim arising out of, in connection with or as a consequence of the performance of or the failure to perform Services (if applicable); or (ix) out of any claims against Buyer or its affiliates by Supplier, its employees or its workers.

(b) Intellectual Property Indemnification.

Supplier agrees to defend, indemnify and hold harmless Powell Industries, its affiliates, directors, officers, employees, agents, successors, assigns, customers and users of the Product(s) from and against any and all losses, expenses, damages, claims, suits and liabilities (including without limitation reasonable attorneys’ fees, experts, and statutory and non-statutory costs, and incidental and consequential damages) arising: (i) as a result of the manufacture, use, possession, sale or resale of any of the Product(s), or if applicable, out of use of the Services or deliverables arising from the Services, infringing or allegedly infringing or misappropriating any patents, copyrights, trademarks, or trade names, trade secrets, or any other intellectual property rights, in any country; or, (ii) out of any misuse of the Powell Industries Marks (defined in Section 15) by any manufacturer, exporter of record or other subcontractor engaged by Supplier to fulfill Purchase Orders for Products sold by Supplier. In the event of infringement, Supplier may use reasonable commercial efforts to procure, at no cost to Powell Industries, the right to continue to use the Product(s). In the event that Supplier is unable or unwilling to procure such rights or suitably replace or modify such Product, or, Buyer believes that the Products are infringing, either Party shall have the right, upon written notice to the other Party, to terminate any outstanding Purchase Orders for the Products and return any remaining inventory for a full refund.

(c) Indemnification Procedure.

Upon discovery of a claim, Powell Industries will promptly notify Supplier, in writing, of any claim for which Powell Industries believes it is entitled to indemnification in sub-sections (a) or (b) above. Powell Industries will permit Supplier to control, in a manner not adverse to Powell Industries, the defense and settlement of any such claims using counsel reasonably acceptable to Powell Industries. Supplier will not enter into any settlement or make admissions or concessions to claimants concerning infringement or validity of an asserted patent without prior written consent from Powell Industries, which shall not be unreasonably withheld.

26. Approvals, Licenses, Certifications and Representations.

Supplier shall: (a) secure and maintain at all times any and all approvals, licenses, registrations, or authorizations of any national, provincial, or municipal agency, department, bureau or other governmental entity, as may be necessary in order to sell and export the Products and to perform the Services, and shall be responsible for all applicable national, provincial, municipal and other governmental registrations, filings, Page 4 of 7 examinations, and other administrative requirements of every nature as required in connection with its performance under this Agreement; provided that Powell Industries shall reasonably cooperate with Supplier in the fulfillment of such duties hereunder; (b) Comply with all rules, regulations and policies of Buyer, including security procedures concerning systems and data and remote access therefore, building security procedures and general health and safety practices and procedures; and (c) Maintain complete and accurate records in a reasonable format relating to the provision of the Services under this Agreement, including records of the time spent and materials used by Supplier in providing the Services. (d) If requested by Powell Industries, all Products must comply with the Restriction on the use of certain Hazardous Substances Directive (2002/95/EC) (“RoHS”), California Proposition 65, the European Directive on Waste Electrical and Electronic Equipment (2012/19/EU) (“WEEE”), Listing requirements of UL or other testing laboratories and all other applicable regulations. (e) Supplier shall comply with all domestic and international laws and regulations applicable to the Products and its import into certain countries, as agreed upon between the Parties. Specifically, Supplier agrees to provide accurate and true information relating to the Products to support Powell Industries’ compliance with customs and trade regulations and U.S. trade agreement preference programs, including but not limited to country-of-origin information for the Products and its component materials, manufacturing and purchasing records, and global safety data sheets. Supplier shall not take any action that violates the U.S. Anti-Boycott laws and regulations (1977 amendments to the Export Administration Act (15 CFR Part 760) and the Ribicoff Amendment to the 1976 Tax Reform Act (26 USC § 999). (f) Supplier shall not directly or indirectly purchase materials to be incorporated in the Products sold to Buyer from entities or persons subject to economic sanctions or embargoes by the United States. (g) Supplier represents that all Product(s) are: (i) not misbranded or inaccurately labeled; (ii) not in violation of the U.S. Consumer Products Safety Improvement Act (15 U.S.C. §2051-2084); and (iii) in compliance with any applicable restrictions on hazardous substances.

27. Equal Employment Opportunity.

As part of Powell Industries’ compliance with federal Equal Employment Opportunity and Affirmative Action regulations, Supplier shall abide by the requirements of 41 CFR §60-1, 41 CFR §60-250; 41 CFR §60-300 and §60-741, the terms of which are incorporated herein by reference. These regulations prohibit discrimination against qualified individuals based on their status as protected veterans or individuals with disabilities, and prohibit discrimination against all individuals based on their race, color, religion, sex, gender, gender identity or national origin. Moreover, these regulations require that the parties take affirmative action to employ and advance in employment individuals without regard to race, color, religion, sex, gender, gender identity, national origin, protected veteran status or disability.

28. No Child or Forced Labor; Reasonable Working Conditions.

Supplier shall comply with all applicable environmental laws, health, and human safety laws, including without limitation, all laws prohibiting child labor, human trafficking, and slavery, including but not limited to the California Transparency in Supply Chains Act (Section 1714.43 of the California Civil Code and Section 19547.5 of the California Revenue and Taxation Code) and, if applicable, the UK Modern Slavery Act of 2015. Specifically, Supplier agrees not to employ children or forced labor in performing its obligations under this Agreement. Moreover, Supplier affirms that neither it nor any of its sub-suppliers or sub-contractors source goods, parts, or components, in whole or in part, from the Xinjiang Uyghur Autonomous Region in China, in accordance with the Uyghur Forced Labor Prevention Act. Supplier shall compensate its employees fairly by maintaining reasonable employee work hours and by providing wages and benefits that comply with the national laws in which it does business. In addition, Supplier shall take precaution not to harm the environment in its manufacturing processes. Powell Industries or a representative may inspect the facility where the Products are made to assess compliance. If Supplier fails to comply with this provision, Powell Industries will take the corrective action as it deems reasonably appropriate.

29. Anti-Bribery Compliance.

Supplier shall comply with the United States Foreign Corrupt Practices Act (“FCPA”) laws and regulations, the United Kingdom Anti- Bribery Act (“UK ABA”), and other applicable anti-bribery and corruption laws and regulations. As such, Supplier agrees not to engage in improper business conduct, such as bribery and other activities, with the intent to improperly influence behaviors or obtain any benefit for Powell Industries. To that end, Supplier agrees that it has not and will not give, offer, promise, or transfer any payment or anything of value, directly or indirectly, to: (a) anyone working in an official capacity for a government, government entity, government-owned or government-controlled company, or public international organization; (b) any political party, political party official, or political candidate; or (c) any third party acting on behalf of any of the foregoing in order to obtain, retain, or direct business; secure an improper advantage; or violate any applicable laws and regulations related to public or commercial bribery, extortion, kickbacks, or other unlawful or improper means of conducting business. Supplier also agrees that it will not take any action, directly or indirectly, to cause Powell Industries to be in violation of such laws and regulations. Supplier further agrees to notify Powell Industries immediately of: (a) any request Supplier receives to take any action; or (b) any action taken by Supplier that might place Supplier or Powell Industries in violation of these laws and regulations. If Powell Industries learns or reasonably believes Supplier has violated the FCPA, UK ABA, or other anti-bribery law applicable to Supplier, Powell Industries may, without prejudice to any other rights, terminate this Agreement, effective immediately, without any obligation to Supplier. Supplier acknowledges that it is a material condition of this Agreement that it comply with anti-corruption and bribery policy laws, and failure to do so may result in the immediate termination of this agreement and forfeiture of any monies otherwise due.

30. Supply Chain Security.

Powell Industries supports internationally recognized initiatives to secure the commercial supply chain (e.g. CTPAT, WCO SAFE Framework of Standards) so as to assure freight and/or merchandise is not compromised contrary to the law. Supplier shall inform Powell Industries of Supplier’s status in any such recognized initiatives. Supplier must implement reasonable security control standards to ensure the integrity and correctness of merchandise and Page 5 of 7 accompanying commercial documentation with regard to Powell Industries shipments. Supplier should address the following disciplines when delivering Products or Services to Powell Industries: (a) Procedures should be in place to protect against un-manifested material being introduced into the supply chain; (b) Physical & Access Security: Supplier’s facilities should be safeguarded to resist unlawful entry and to protect against outside intrusion. Adequate measures should be considered for positively identifying employees, visitors and vendors, and to prevent unauthorized access to information technology systems; (c) Personnel Security: Supplier, in accordance with all applicable laws, should conduct employment screening of prospective employees to include periodic background checks and application verifications; (d) Education and Training Awareness: A security awareness program should be provided to employees covering cargo integrity, determining and addressing unauthorized access and communications protocols for notifying policing agencies when suspected or known illegal activities are present; and (e) Conveyance Security: Supplier should implement reasonable steps to protect against the introduction of unauthorized personnel and material in conveyance (e.g. containers, trucks, drums, etc.) destined to Powell Industries. If, as a result of facilitating a shipment to Powell Industries, Supplier suspects a supply chain security breach or concern after dispatch from its facility, Supplier is obligated to notify Powell Industries immediately. Supplier shall cooperate with Powell Industries’ supply chain security efforts and allow periodic on-site reviews by its third-party security consultant to verify such compliance.

31. Conflict Minerals.

As of the time of the issuance of any Purchase Order, Supplier represents that: (a) the Products do not contain any conflict minerals, which are defined as (i) gold or (ii) tantalum, tin, or tungsten (derivatives of columbite-tantalite (coltan), cassiterite, and wolframite); or (b) if the Product does contain conflict minerals, Supplier has notified Powell Industries and received written approval to proceed with fulfillment of the Purchase Order. If Powell Industries determines that any representation or certification made by Supplier pursuant to this provision is inaccurate or incomplete in any respect, then Powell Industries may terminate this Agreement immediately.

32. Compliance with Law.

In addition to the laws and regulations specifically provided for in this Agreement, Supplier shall comply with all applicable laws, regulations and ordinances, and shall maintain all the licenses, permissions, authorizations, consents and permits that it needs to carry out its obligations under a Purchase Order or related agreement. Supplier shall comply with all export and import laws of all countries involved in the sale of the Products under this Agreement or any resale of the Products by Supplier. Supplier assumes all responsibility for shipments of Products requiring any government import clearance. Buyer may terminate this Agreement if any governmental authority imposes antidumping or countervailing duties or any other penalties on the Products.

33. Supplier Manual.

Supplier must comply with the requirements contained in Powell Industries’ Supplier Conduct Guidelines Manual and its Code of Conduct.

34. Inspection and Audit Rights.

Powell Industries has the right to audit and inspect, at any reasonable time and upon reasonable notice, Supplier’s books, records, inventory, tooling, and plants, as related to the Product(s), to assure compliance with any applicable law, or the Product’s specifications (such as quality records).

35. Cancellation for Insolvency.

If Supplier becomes insolvent, files a petition for bankruptcy or commences or has commenced against its proceedings relating to bankruptcy, receivership, reorganization or assignment for the benefit of creditors, then Buyer may terminate a Purchase Order and any related agreement upon 10 days’ prior written notice to Supplier.

36. Waiver.

The failure of either Party to require the performance of any term or condition of this Agreement or the waiver by either Party of any breach of the same shall not prevent subsequent enforcement of such term or condition nor be deemed a waiver of any subsequent breach. Any change in, addition to, renewal of, or waiver of the terms and conditions of this Agreement shall be binding upon either of the Parties only if in writing signed by its officer or other authorized agent.

37. Confidentiality.

All non-public, confidential or proprietary information of Buyer disclosed by Buyer to Supplier, whether disclosed orally or disclosed or accessed in written, electronic or other form or media, and whether or not marked, designated or otherwise identified as “confidential” in connection with this Agreement is confidential, solely for the purpose of performing this Agreement and may not be disclosed or copied unless authorized in advance by Buyer in writing. Upon Buyer’s request, Supplier shall promptly return or certify destruction of all documents and other materials received from Buyer. Buyer shall be entitled to injunctive relief for any violation of this section.

38. Remedies Not Exclusive.

All rights and remedies provided in this Agreement are cumulative and not exclusive, and the exercise by Buyer of any right or remedy does not preclude the exercise of any other rights or remedies that may now or subsequently be available at law, in equity, by statute, in any other agreement between the Parties or otherwise. Acceptance of Product shall not waive any of the aforementioned remedies.

39. Third-Party Beneficiaries.

This Agreement is intended to and shall confer upon Buyer’s affiliates, who are entitled to purchase and/or receive Products or Services under this Agreement, any legal or equitable right, benefit or remedy of any nature whatsoever, by reason of this Agreement.

40. Survival.

The provisions of this Agreement which by their nature should apply beyond their terms will remain in force after any termination or expiration of this Agreement, including, but not limited to, the following provisions: relating to payment, confidentiality, disclaimers, warranties, limitation of liability, indemnification, law and jurisdiction, severability, and this paragraph.

41. Severability.

The holding of any provision of this Agreement to be void, invalid or unenforceable shall not affect the validity of the other provisions of this Agreement.

42. Assignment.

Supplier shall not assign, transfer, delegate or subcontract any of its rights or obligations under this Agreement for the manufacture or supply of Products or the performance of Services without the prior consent of Buyer. If, with Powell Industries’ prior consent, Supplier engages a third-party manufacturer, exporter of record or other subcontractor to fulfill its obligations under Page 6 of 7 Buyer’s Purchase Order, then Supplier shall communicate the name, address and role of such third party in writing (email is sufficient) to Buyer. Any updates or changes to such third-party list should be communicated to Buyer promptly in writing. Buyer may at any time assign or transfer any or all of its rights or obligation under this Agreement without Supplier’s prior written consent to any affiliate. Any attempted transfer or assignment by Supplier will be void and constitute a material breach of this Agreement.

43. Governing Law.

This Agreement shall be construed in accordance with and be governed by the laws of the State of New York, without regard to the conflict of law’s provisions thereof. The Parties agree that the United Nations Convention on Contracts for the International Sale of Goods does not apply to this Agreement. Each of the Parties irrevocably submits to the exclusive jurisdiction of the state and federal courts in the State of New York, Suffolk County, or the law of the People’s Republic of China in the courts of Dongguan, China, if Supplier is located in China, and agrees that such courts shall have personal jurisdiction over them for the purpose of any action or proceeding arising out of or relating to this Agreement. Delivery of process in any such dispute by a recognized commercial courier service to the last known business address of Powell Industries or Supplier shall be deemed sufficient to confer personal jurisdiction on any of said courts. Each of the Parties agrees that a final judgment in any action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law. The Party prevailing in any such litigation shall be entitled to its reasonable attorney fees and other costs and expenses from the other Party.

44. Entire Agreement.

This Agreement constitutes the entire agreement between the Parties concerning its subject matter, merging and superseding all prior and contemporaneous agreements and understandings. Each Party hereby acknowledges that neither has made any representations of any kind to induce this Agreement or otherwise in connection therewith, except as may be expressly set forth herein.

45. Headings.

Headings used in this Agreement are for convenience only and shall not be considered in construing or interpreting this Agreement.

46. Force Majeure.

Neither Party shall be liable for any delay or failure in performing its obligations under this Agreement arising out of circumstances beyond its reasonable control, including fire, floods, strikes, lockout, accident, sabotage or other similar causes which affect either Party, provided that the Party provides notice to the other in writing of the delay or non-performance event within 5 days of its commencement. Powell Industries may extend the delivery schedule to accommodate the delay or non-performance, in its sole discretion; however, should said event continue for a cumulative total of at least 30 days, Powell Industries may cancel the unfilled portion of the Purchase Order effective immediately upon written notice to Supplier, without liability to Powell Industries.

47. Public Announcement.

Supplier shall not publicly disclose, issue any press release or make any other public statement, including publication on its website, concerning the existence of this Agreement, Powell Industries’ purchase of Product(s) or Services, or the subject Purchase Orders, without Powell Industries’ prior written approval.

48. Relationship of the Parties.

Nothing in this Agreement shall be deemed to constitute either Party as an agent, representative, employee, or create an agency relationship for any purpose.

49. Payment and Terms.

Powell Industries will not pay an extra service fee on any credit card purchases nor will the vendor be authorized to charge Powell Industries prior to shipment without written permission.  Our standard vendor terms are Net 60 days.