TERMS AND CONDITIONS

The following terms and conditions shall apply to all sales by American Barcode and RFID Incorporated (“AB&R”) to the Purchaser of any and all Products and to all quotations and offers made by and purchase orders accepted by AB&R.  Any different or additional terms and conditions contained in any other document submitted by the Purchaser are hereby rejected.  Neither AB&R’s commencement of performance or shipment or delivery of product shall be deemed or construed as acceptance of any additional or different terms and conditions proposed by Purchaser.  Purchaser agrees that all purchase orders placed by Purchaser, shall be governed by this Agreement, whether or not such terms and conditions accompany AB&R’s shipment of products.

1.        Purchase Price and Taxes.  The purchase prices for Products shall be the amounts set forth in the purchase order. Unless otherwise agreed in writing by AB&R, such prices are exclusive of any applicable sales, use, excise, property or other federal, state, county, municipal, local or foreign taxes, value-added or other indirect taxes, customs duties, tariffs or other imposts, and any related penalties and interest (collectively, the “Taxes”).  Purchaser shall pay when due any Taxes (other than any tax based solely on the net income of AB&R) arising out of the transactions contemplated by this Agreement and shall indemnify and hold harmless AB&R from any and all such Taxes.

2.        Terms of Payment and Delivery.  Except where otherwise provided herein or specified in writing by AB&R (i) the terms of payment hereunder are net cash fifteen (15) days from the date of AB&R’s invoice, without deduction or setoff of any kind, (ii) all payments shall be made in United States dollars, and (iii) products shall be shipped to Purchaser F.O.B. origin.  Customers will be charged COD unless AB&R’s credit application has been completed and approved.  Most major credit cards are accepted.  An invoice will be forwarded at the time of shipment, and AB&R shall use reasonable efforts to ship Products in accordance with AB&R’s announced shipment schedule by the method specified by Buyer; provided, however, that all shipment and delivery dates are approximate.  Shipments of Products are in all cases subject to availability, and partial shipments by AB&R of quantities of Products requested in the Purchase Order are permitted.

3.        Returns.  EXCEPT FOR CUSTOM LABELS, PRINTHEADS AND SOFTWARE, all other merchandise may be returned to AB&R within 15 days from date of shipment under the following conditions: 1) A Return Material Authorization (“RMA”) number is first obtained from AB&R’s Customer Service Department prior to returning any qualified product. 2) All returned merchandise must be packaged in the original manufacturer’s box(s) and include all manuals, cables, warranty cards, static bags, etc. 3) Returned items must be unused, clean and free of damage of any kind. 4) Purchaser shall be responsible for any freight charges incurred in returning merchandise to AB&R.  A minimum restocking fee of 25% will be charged by AB&R for any item returned.  All merchandise is non-returnable to AB&R after 15 days from date of shipment. ALL CUSTOM LABELS ARE SUBJECT TO OVER / UNDER RUNS OF 10%. EXACT QUANTITY RUNS MUST BE SPECIFIED AT TIME OF ORDER AND WILL INCUR AN ADDITION CHARGE; SALES OF CUSTOM LABELS, PRINTHEADS AND SOFTWARE ARE FINAL.

4.        Risk of Loss.  Anything herein or in applicable law to the contrary notwithstanding, Purchaser shall bear the risk of loss, deterioration or damage to the Products from the time they are placed by AB&R in the possession of a carrier.

5.        Reservation of Security Interest.  AB&R reserves and retains a security interest in the Products and the proceeds thereof until payment therefore in full has been made by Purchaser.  This contract constitutes a security agreement between Purchaser, as debtor, and AB&R, as secured party, under the Uniform Commercial Code, and AB&R has the rights and remedies of a secured party thereunder.  Purchaser authorizes AB&R to file financing statements and to do any other act or thing necessary or useful in perfecting AB&R’s security interest in the Products and shall cooperate fully with AB&R in this regard.

6.        Service Fee and Collection Costs.  Purchaser shall pay a delinquency and service fee of ten percent (10%) per annum on amounts due AB&R, computed for each twenty-four (24) hour period during which payment remains in arrears.

7.        Acceleration.  AB&R may demand immediate payment of any and all amounts owed by Purchaser to AB&R hereunder or under another contract of sale between Purchaser and AB&R, and cancel any previously accepted Purchase Order, by written notice to Purchaser, upon any material breach by Purchaser of this Agreement.

8.        Warranties and Purchaser’s Remedies.  AB&R transfers to Purchaser all warranties, if any, that AB&R has received from the manufacturer only to the extent provided by the manufacturer and subject to all conditions of such manufacturer’s warranty.  Should any Products be found not to conform with the manufacturer's warranty during the warranty period, Purchaser shall promptly notify AB&R, and AB&R shall, at its sole option, shall (i) contact the manufacturer and request that it provide to the Purchaser the remedy available from the manufacturer, if any; (ii) repair or replace the defective Product; or (iii) refund to Buyer or issue a credit to Buyer for the purchase price of the defective Product.  Buyer must contact AB&R for a Return Material Authorization (“RMA”) number before returning any Product for warranty repair.

9.        DISCLAIMER OF WARRANTIES. THE WARRANTIES EXPRESSLY SET FORTH IN THIS AGREEMENT ARE EXCLUSIVE. EXCEPT FOR THE EXPRESS WARRANTIES STATED HEREIN, AB&R DOES NOT MAKE ANY AND EXPRESSLY DISCLAIMS ALL WARRANTIES, WHETHER ORAL OR WRITTEN, EXPRESS OR IMPLIED, OR ARISING BY USAGE OF TRADE OR COURSE OF DEALING, INCLUDING BUT NOT LIMITED TO ANY IMPLIED WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE AND WARRANTY AGAINST INFRINGEMENT.

10.     LIMITATION OF LIABILITY. AB&R’S LIABILITY TO PURCHASER FOR DEFECTIVE OR NON-CONFORMING PRODUCTS, FOR DELAY IN SHIPMENT OR DELIVERY, OR FOR ANY OTHER BREACH OF THIS AGREEMENT, SHALL BE LIMITED TO ITS OBLIGATIONS AS STATED IN THIS AGREEMENT.

(a)      NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED HEREIN, PURCHASER EXPRESSLY AGREES THAT AB&R SHALL NOT, UNDER ANY CIRCUMSTANCES, BE LIABLE FOR ANY CONSEQUENTIAL, INCIDENTAL, SPECIAL, INDIRECT OR PUNITIVE DAMAGES, INCLUDING BUT NOT LIMITED TO LOST PROFITS, LOSS OF BUSINESS OR LOSS OF GOOD WILL, WHETHER CLAIMED UNDER CONTRACT, TORT, INDEMNITY OR ANY OTHER LEGAL THEORY.

(b)     PURCHASER EXPRESSLY AGREES THAT UNDER NO CIRCUMSTANCES SHALL AB&R’S TOTAL LIABILITY OF ALL KINDS ARISING OUT OF OR RELATED TO THESE TERMS AND CONDITIONS OR ANY SALE HEREUNDER (INCLUDING BUT NOT LIMITED TO ANY WARRANTY CLAIMS HEREUNDER) EXCEED THE TOTAL AMOUNT THAT PURCHASER PAYS TO AB&R HEREUNDER FOR THE PURCHASE OF THE PRODUCT THAT IS THE SUBJECT OF SUCH LIABILITY.

(c)      Any action for breach herein or any other action otherwise arising hereunder must be commenced within twelve (12) months after the cause of action accrues, or such action shall be deemed barred.

11.     Purchaser’s Remedies Exclusive. The purchaser’s remedies set forth herein shall be the sole and exclusive remedies of purchaser and AB&R’s sole and exclusive liability.

12.     Patent Indemnification.  Purchaser shall hold AB&R harmless against any expense or liability from claims of unfair competition or infringement or contributory infringement of any patents, trademarks or copyrights related to Products sold hereunder or to Purchaser’s use of any Product in combination with products not supplied by AB&R.

13.     Force Majeure.  AB&R shall be excused from liability for unusual delays or failure to deliver or fill any Purchase Order where caused by acts of God, fires, floods, strikes, work stoppages, accidents, allocations or other controls, or regulations, including export or import regulations of any foreign or U.S. federal, state or local government, shortage of trucks or any other means of transportation, fuels, materials or labor, or any other cause beyond AB&R’s reasonable control, whether or not similar in kind or class to those mentioned.

14.     Miscellaneous.  Any dispute or difference between the parties pertaining to these terms and conditions may be referred to arbitration and shall upon and after such reference be finally settled by arbitration to be held at Phoenix, Arizona, in accordance with the Commercial Arbitration Rules of the American Arbitration Association.  The terms and conditions shall be construed and enforced pursuant to laws of the State of Arizona, U.S.A., exclusive of the laws relating to conflict of laws.  In the event of any arbitration, litigation or other dispute arising as a result of or by reason of these terms and conditions, the prevailing party in any such dispute shall be entitled, in addition to any other damages assessed, to its reasonable attorneys’ fees and all other costs and expenses incurred in connection with settling or resolving such dispute.  A waiver by either party hereto of any term or condition hereof shall not be construed as a waiver or modification of any other term or condition hereunder or any other contract governing this contract.  No rights or remedies are waived or modified by AB&R unless expressly waived in writing by AB&R.  If any part of this Agreement is held void or unenforceable, such part shall be treated as severable, leaving valid the remainder.  AB&R’s remedies herein provided shall be cumulative and in addition to any other or further remedies provided by law or equity.