CONDITIONS OF PURCHASE

1. DEFINITIONS

Within these Conditions of Purchase, also referred to as the "Agreement", the following definitions shall apply:
"Clause" or "Clauses" shall mean the relevant clause or clauses, as appropriate, as set out in this Agreement;
"GKN" shall mean GKN Aerospace Services Limited - Registered Office: Ferry Road, East Cowes, Isle of Wight, PO32 6RA;
"Operating Address" shall mean GKN's site address at Airport Service Road, Portsmouth, Hampshire, PO3 5PE, UK.
"Order" shall mean the authorised purchase order, including the Clauses detailed herein and any subsequent authorised amendment hereto, placed by GKN upon the Supplier for goods and/or services;
"Sub-Clause" or "Sub-Clauses" shall mean the relevant referenced part or parts of the Clause or Clauses;
"Supplier" shall mean the contracting party upon whom the Order is placed; and
"Supplies" shall mean all goods and/or services to be supplied by the Supplier to GKN under the Order

2. APPLICABLE CONDITIONS

This Agreement including the Order and any other document incorporated by reference shall constitute the entire agreement between the parties and, subject to any prior formal conditions signed by authorised personnel of GKN and the Supplier, shall supersede any prior communications or representations between the parties, including any conditions of sale, or similar document, issued by the Supplier. This Agreement contains the only conditions upon which GKN is prepared to deal with the Supplier. Nothing in this Clause 2 shall operate to limit or exclude any liability or remedy for fraud.

3. OFFICIAL ORDER

(a) No Supplies will be accepted or paid for unless supplied in accordance with the Order. The Supplier shall reference the Order number on all correspondence entered into with GKN in respect of the Order. Each Order for Supplies placed by GKN upon the Supplier shall be deemed to be an offer by GKN to purchase Supplies subject to these Conditions of Purchase and no Order shall be accepted until the Supplier expressly accepts the offer by giving notice of acceptance by returning an acknowledgement in the form specified in Sub-Clause (b) below or signing and returning the Order acknowledgement or impliedly accepting the offer by fulfilling the Order in whole or in part.
(b) The Supplier may return any form of acknowledgement of receipt that the Supplier normally issues in response to customer orders provided the contents of any such form are restricted to the acknowledgement of such receipt. It is understood by the Supplier that any standard conditions of sale or similar wording printed or notified anywhere on the Order or other form of acknowledgement, including electronic acknowledgement, issued by the Supplier are deemed to be null and void and will not be binding on the Supplier or GKN.

4. AMENDMENTS

No variation to the Order will be recognised by GKN unless presented in writing and duly authorised by the buyer named overleaf or a suitably authorised representative of GKN.

5. SPECIFICATION

All Supplies under this Order shall conform (where applicable) with applicable laws, the quality, quality standard and specification stated on the Order, shall be fit for the purpose required by GKN and free from any defect whether actual or latent. GKN's rights under this Order are in addition to the statutory conditions implied in favour of GKN by the Sale of Goods Act 1979 (as amended) the Supply of Goods and Services Act 1982 and any other statute.

6. PACKAGING

All Supplies (where they include goods) under the Order shall be securely, suitably and adequately packed for the transportation requirements to GKN's Operating Address or the destination as stated on the face of the Order, if different to the Operating Address, and the packaging marked with GKN's Order number. All packaging shall be non-chargeable and non-refundable, unless otherwise agreed in writing by GKN whereupon it may be returned at the Supplier's risk and expense

7. CERTIFICATES OF CONFORMITY/RELEASE NOTES

(a) Where stated in the Inspection Requirements overleaf, one copy of a numbered Certificate of Conformity/Release Certificate detailing GKN's Order number, part number description, serial number and quantities delivered, shall accompany each consignment of Supplies delivered.
(b) Where applicable, the Supplier, if a stockist, shall provide one copy of the Certificate of Conformity/Release Certificate from the manufacturer of the Supplies and one copy of the Supplier's own release document.

8. DELIVERY

(a) Delivery and risk shall be DDP Incoterms 2000 to GKN's Operating Address unless otherwise instructed on the face of the Order.
Deliveries unless otherwise stated shall be to GKN during the following times:
Monday to Thursday: 7.30a.m. to 12.00 noon.; or 12.30 p.m. to 4.00 p.m; or alternate Fridays: 8.00 a.m. to 12.00 noon.

(b) If, for whatever reason, delivery is not effected in accordance with the Order, then GKN may, without prejudice to any other right or remedy, wholly or partly terminate the Order without incurring liability to the Supplier and may resource the Supplies from a third party of GKN's choosing and charge to Supplier any associated excess costs. Furthermore, GKN does not limit its right to claim liquidated damages in respect of late delivery or any other reason. In no way shall this Sub-Clause be restricted by the operation of Clauses 21 and 22 except insofar as GKN exercises its right to recover wasted administrative effort under said Clauses.

(c) Title in the Supplies shall pass to GKN on delivery. Such passing of title shall not constitute acceptance of the Supplies by GKN.

(d) In the event that GKN is unable to accept deliveries, for whatever reason, GKN shall have the right to suspend, wholly or in part, deliveries under the Order.

(e) In respect of delivery, time shall be of the essence in every event.

(f) Supplies shall be supplied under and displaying GKN's Order number and, where applicable, item number. Attempts to deliver Supplies without such Order number shall entitle GKN to reject such Supplies and, at GKN's sole option, cancel the Order in whole or in part.

9. INSPECTION AND REJECTION

(a) Pre delivery inspection requirements shall be in accordance with the provisions on the face of the Order.
(b) GKN shall have the right to avail itself of any one or more of the remedies listed in Clause 27 at any time if any Supplies are not in accordance with the Order or specification or that are otherwise not fit for purpose.

10. PRICE

(a) Prices shall be as stated on the face of the Order and unless agreed otherwise shall include, but not be limited to: (i) VAT, customs duties and taxes; (II) packaging in accordance with Clause 6; (IIi) any special considerations in accordance with Clause 24; and (iv) all paperwork, including certificates, necessary for proper administration and to make the Supplies conform to the requirements of this Agreement, including the Order. No alterations will be accepted unless by prior written agreement with the buyer named overleaf or a suitably authorised representative of GKN. Price includes delivery in accordance with Clause 8 above.

(b) Where the Order is issued to the Supplier showing a zero value such Order shall be made under circumstances where the Order value is not finalised at the time of placement of such Order. Under no circumstances shall such an Order be construed, nor shall the Supplier be entitled to consider the Order, null and void due to a total failure of consideration or for any other reason. Under such circumstances the parties shall negotiate the Order price in good faith and an Order amendment, showing such negotiated price, shall be issued by GKN in accordance with Clause 4 above upon the price being finalised. Notwithstanding the foregoing, in the event that the parties are unable to negotiate final pricing GKN shall be responsible only for work carried out by the Supplier strictly in accordance with the instructions on the face of the Order and the price payable shall be calculated on the basis of prices agreed for similar work in past dealing between the parties or the prevailing best price available in the open market for such work, whichever is the lesser amount.

11. INVOICES AND PAYMENT

(a) Invoices quoting the Order number, Certificate of Conformity/Release Certificate number (where applicable), part numbers, description and quantities of Supplies delivered shall be forwarded at the time of despatch to GKN Financial Accounts Department, GKN Aerospace Services Limited, Airport Service Road, Portsmouth, Hampshire, PO3 5PE, UK. Failure to detail any of the above information may result in a delay in payments by GKN.

(b) In addition to Sub-Clause 11(a), for consignments of Supplies made from outside the United Kingdom the following information must be clearly displayed on all invoices, advice notes, delivery notes, packing notes and like documents: (i) the Supplier's V.A.T. registration number, if the Supplier is registered in the United Kingdom for VAT purposes; (II) GKN's V.A.T. registration number; (IIi) country of origin(iv) terms of delivery; (v) consignment value and currency; (vi) net and gross consignment weight; and (vII) commodity codes each as designated in H. M. Customs & Excise tariff.

(c) Payment will normally be made 90 (ninety) days net monthly from when the Supplies in accordance with the Order, and a true and correct invoice, are received. Time for payment shall not be of the essence of this Agreement.

(d) Without prejudice to any other right or remedy, GKN reserves the right to set off any amount owing at any time from the Supplier to GKN against any amount payable by GKN to the Supplier under this Agreement.

(e) If any sum under this Agreement is not paid when due then, without prejudice to the parties' other rights under this Agreement, that sum shall bear interest from the due date until payment is made in full, both before and after any judgement, at 3% per annum over Barclays Bank plc's base rate from time to time. The Supplier is not entitled to suspend deliveries and/or performance of the Supplies as a result of any sums being outstanding.

12. INDEMNITY

In respect of the Order and the Supplies (and each of them), the Supplier hereby agrees to indemnify and hold harmless GKN against all claims, damages, liabilities and costs whatsoever (whether direct or indirect) resulting from:

(a) any damage, loss, death or injury caused by any act, negligence or omission of the Supplier, any of its sub-contractors or any of its agents;

(b) any alleged or actual infringement of any intellectual property right(s), (including without limitation any patent, utility model, design right, copyright, trade mark, right in confidential Information (including know-how), in each case whether registered or unregistered), in existence or pending anywhere in the World at the date of the delivery of the Supplies, relating howsoever to the Supplies; and

(c) defective workmanship, quality or materials.

13. GKN FURNISHED EQUIPMENT

(a) Any free issue material, specifications, designs, drawings, notes, data, documents, samples, jigs, tools or patterns supplied by GKN or manufactured for GKN by the Supplier in connection with the Order and whilst under bailment to the Supplier shall remain the property of GKN throughout and:

(I) shall be adequately insured by the Supplier;

(II) shall be clearly marked as the property of GKN;

(III) shall be maintained in a reasonable condition (fair wear and tear excepted) at the Supplier's premises and entirely at the risk of the Supplier;

(IV) shall not be copied or communicated to any other party or used for any work other than that detailed on this Order, without the prior express written consent of GKN;

(V) shall, where applicable, be clearly marked with the tooling number as issued by GKN.

(b) GKN shall at all times have property in any scrap resulting from free issue material, and the sole discretion as to its disposal.

(c) GKN may at any time request the return of GKN furnished equipment whereupon the Supplier shall promptly return the same to the Operating Address or such other address as GKN may require, in each case at the risk and expense of the Supplier.

14. INTELLECTUAL PROPERTY RIGHTS

(a) All intellectual property rights (including without limitation patents, utility models, design rights, copyrights, trade marks, rights in confidential Information (including know-how), in each case whether registered or unregistered and including all applications (or rights to apply) for such rights) in any and all free issue material, specifications, designs, drawings, notes, data, documentation, samples, jigs, tools or patterns information and other intellectual property that:

(I) are supplied by or on behalf of GKN to the Supplier; and/or
(II) arise from the performance of work in pursuance of an Order; and/or
(III) are included in the Supplies,

shall (in the case of (i) above) remain and (in the case of (II) and (IIi) above) be deemed to be the property of GKN and the Supplier shall promptly take all necessary steps and do all necessary acts (at Supplier's sole expense) to vest such intellectual property rights in GKN. Such intellectual property and intellectual property rights shall not be used by Supplier except to the extent required for the purposes of the Order, nor copied or communicated by Supplier to any other party, without the prior express written consent of GKN.

(b) All such specifications, designs, drawings, notes, data, documentation, information and other intellectual property referred to in (a) above shall be returned/provided (together with all copies thereof) to GKN immediately upon request or (in any event) on completion (or termination of) the Order or upon termination of this Agreement.

(c) The Supplier represents and warrants that the purchase, use, sale and/or other exercise of the Supplies by GKN will not infringe any intellectual property right(s), (including without limitation any patent, utility model, design right, copyright, trade mark, right in confidential Information (including know-how), in each case whether registered or unregistered), in existence or pending anywhere in the World at the date of delivery of the Supplies.

15. UK GOVERNMENT CONTRACT CONDITIONS

In the event that it is indicated on the face of the Order that Supplies are required for a Government Contract then the Order shall be subject to such conditions detailed in the latest issue of the "Standard Conditions of Government Contract for Stores Purchases" (Form GC/STORES/1) and any other such Government conditions as specified on the face of the Order.

16. WORK ON SITE

(a) The Supplier accepts that if any work in pursuance of the Order is carried out by or on behalf of the Supplier at any GKN site, whether at the Operating Address or otherwise, then such work shall be subject to GKN's "General Conditions of Work on Site" or such document that shall be in force from time to time, copies of which are available on request.

(b) It is the Supplier's responsibility to ensure the areas used for such work are kept in a clean and tidy state at all times as such work allows. If the Supplier fails to leave such area in a clean and tidy state or substantially as the Supplier found such area, GKN may employ persons to remedy the situation and set off the cost incurred from the Supplier's account.

17. ASSIGNMENT & SUB-CONTRACTING

(a) The Supplier shall not be entitled to assign this Order or any part of it without the prior written agreement of GKN. GKN may assign this Order or any part of it to any person, firm or company.

(b) When the Supplier determines that certain operations or processes under the Order are to be undertaken by a sub-contractor, the Supplier must ensure that the sub-contractor is GKN approved in writing, prior to the placement of each order so sub-contracted.

18. CONFIDENTIALITY

The Supplier shall keep in strict confidence all specifications and other information (including without limitation the terms of each Order and all technical and/or commercial know-how, specifications, inventions, processes or initiatives) which have been disclosed to the Supplier by GKN or its agents and any other confidential information concerning GKN's business or its products which the Supplier may obtain and the Supplier shall restrict disclosure of such confidential material (and any of it) to such of its employees, agents or sub-contractors as need to know the same for the purpose of discharging the Supplier's obligations to GKN [under this Agreement and/or the relevant Order] and shall ensure that such employees, agents or sub-contractors are subject to like obligations of confidentiality as bind the Supplier; The Supplier shall indemnify GKN in full against all costs, expenses (including without limitation legal and other professional fees), damages and other loss directly or indirectly arising from the unauthorised disclosure of any such confidential material referred to above.

19. PARTIAL INVALIDITY AND WAIVER

Any provision of the Order subsequently found to be invalid, void, voidable, unenforceable or unreasonable shall be deemed severable and shall not in any way affect the validity or enforceability of the remainder of the Order. Any failure or delay by GKN to enforce any provision of the Order shall not be construed as a waiver of that or any other provision. Any waiver by GKN of any breach of, or any default under, any provision of this Order by the Supplier shall not be deemed a waiver of any subsequent breach or default and shall in no way affect the other terms of this Order.

20. NOTICES

Any Notice(s) or other communication(s) issued pursuant to this Order shall be in writing and sent either by hand, registered post, courier or by fax to the address of the party specified on this Order.

21. LIQUIDATED DAMAGES FOR ADMINISTRATION DUE TO EARLY OR LATE DELIVERY

With regard to delivery, on time delivery is of the essence in every event. Without prejudice to GKN's rights or remedies under this Agreement or at law GKN reserves the right to levy against the invoice of late or early delivered Supplies from the Supplier a financial sum of £75 (seventy five pounds sterling), for each occurrence of late delivery or early delivery where such early delivery is more than 7 (seven) days prior to the scheduled delivery date. This fairly reflects administrative resources only wasted, rescheduled or incurred as a direct result of each such late or early delivery. Such sum levied in accordance with this Clause against Supplier's account for the late or early delivered Supplies may be made on communication to Supplier of discovery of such late or early delivery. This Clause shall apply to administration charges only in respect of late or early delivery and, for the avoidance of doubt, in no event shall this Clause operate to limit the effect of GKN's right to claim under Sub-Clause 8(b) above.

22. LIQUIDATED DAMAGES FOR ADMINISTRATION DUE TO DEFICIENT QUANTITY OR QUALITY

Without prejudice to GKN's rights or remedies under this Agreement or at law, GKN reserves the right to levy against the account of the Supplier a financial sum, agreed as follows by Supplier, for each occurrence of deficient quantity or quality, that reflects fairly administrative resources only wasted as a direct result of one or both of the following deviations relating to Supplies:
Delivery of deficient quantity of Supplies: £75 (seventy five pounds sterling); Delivery of deficient quality of Supplies: £100 (one hundred pounds sterling). Such sum or sums levied against Supplier's account in accordance with this Clause may be made on communication to Supplier of discovery of such deviation. This Clause shall apply to administration charges only in respect of a delivery of deficient quantity or quality and, for the avoidance of doubt, in no event shall this Clause operate to limit the effect of GKN's right to claim under Sub-Clause 8(b) above.

23. TERMINATION

(a) For Convenience: GKN shall have the right to terminate the Order in whole or in part at any time, by serving on the Supplier written notice of termination. Upon receipt of such notice of termination all terminated work shall be discontinued and GKN shall pay to the Supplier such sum as is fair and reasonable in respect of work-in-progress at the time of termination but such compensation shall not include loss of anticipated profits or any consequential loss and the Supplier agrees to accept such sum in full and final satisfaction of all claims arising out of such termination.
In the event of termination of the Order the Supplier shall use its best endeavours to mitigate the loss arising from such termination.
In no case shall the amount payable by GKN for the terminated work exceed the price that would have been payable if the work had been completed. GKN reserves the right to recover any part-completed work, including any relevant jigs, tools, fixtures or documentation.

(b) For Default: GKN shall notify the Supplier of any breach or default of these conditions. If the Supplier is unable to remedy such breach or default within a period of 30 (thirty) days from the notice being given, then GKN reserves the right to terminate the Order in whole or in part without incurring liability to the Supplier. Without prejudice to GKN's rights and remedies under this Agreement or at law GKN reserves the right to claim from the Supplier delta costs incurred under this Clause.

(c) For Insolvency: GKN may suspend or terminate this Order without liability to the Supplier immediately on giving notice to the Supplier if:

(I) an order is made or a resolution is passed for the winding up of the Supplier, or circumstances arise which entitle a court of competent jurisdiction to make a winding-up order of the Supplier; or
(II) an order is made for the appointment of an administrator to manage the affairs, business and property of the Supplier, or documents are filed with a court of competent jurisdiction for the appointment of an administrator of the Supplier, or notice of intention to appoint an administrator is given by the Supplier or its directors or by a qualifying floating charge holder (as defined in paragraph 14 of Schedule B1 to the Insolvency Act 1986); or
(III) a receiver is appointed of any of the Supplier's assets or undertaking, or circumstances arise which entitle a court of competent jurisdiction or a creditor to appoint a receiver or manager of the Supplier, or if any other person takes possession of or sells the Supplier's assets; or
(IV) the Supplier makes any arrangement or composition with its creditors, or makes an application to a court of competent jurisdiction for the protection of its creditors in any way; or
(V) the Supplier ceases, or threatens to cease, to trade; or
(VI) the Supplier takes or suffers any similar or analogous action in any jurisdiction in consequence of debt.

(d) For Aircraft Specific Programme Interruption: In the event that GKN's work with its customer is terminated or suspended (whether in whole or in part) due to an interruption of such customer's programme (other than where such interruption is due solely to GKN), the S

24. REACH

(a) The Supplier represents, warrants and undertakes that the supply of products to GKN is in compliance with the European Union Regulation Number 1907/2006 concerning the Registration, Evaluation, Authorisation and Restriction of Chemicals ("REACh") (as may be amended and supplemented from time to time); and

(b) The Supplier: