GENERAL PURCHASING CONDITIONS

Revision: 1 Date: 01 July 2013

1 DEFINITIONS 3 DELIVERY

1.1 "The Agreement" means Buyer’s purchase order, these 3.1 The Goods shall be delivered, properly packed and
General Conditions of Purchase, technical marked, at the agreed place and time of delivery. Unless
documentation and other documents made part of this otherwise agreed, delivery shall be deemed to have
Agreement by special reference. In case of any taken place when the Goods are handed (or services
contradiction, the documents of the Agreement shall performed) over to Buyer at Buyer’s premises. Unless
apply in the order of precedence as stated above. Any otherwise agreed, risk of damage to the goods passes
standard terms or conditions of the Seller are explicitly upon delivery.
not a part of the Agreement.
3.2 Timely Delivery of the product is sole responsibility of the
1.2 "The Price" means the amount to be paid to Seller for Seller as per the agreed delivery period. If seller does
the Goods in accordance with the purchase order and not deliver the product / supplies as per the terms of
variation orders made in accordance with clause 10. Purchase Order, buyer reserves the right to cancel part
of full quantity of the purchase order and/or reject the
1.3 “The Goods” means services, documentation, goods or services, OR, in Buyer’s sole discretion, accept
equipment, material and other items to be delivered to a revised delivery schedule.
Buyer by Seller in accordance with the Agreement.
3.3 In no circumstances shall the Seller delay or suspend the
1.4 “Buyer” means Eltek S G S P v t L t d . delivery of goods for any reason whatsoever to the
Buyer for which payment has not been received from
1.5 “Seller” means the company or the individual the Buyer.
purchase order is issued to.

4 DOCUMENTATION, MARKING AND SERVICE

2 PURCHASE ORDER - confirmation/agreement
4.1 Packing lists, advice notes, invoices and other
2.1 Buyer’s purchase order shall immediately, or at the latest documentation shall only relate to one purchase order
within 48 hours, be confirmed by Seller by returning it and shall be duly marked with purchase order number
accepted and signed. If Seller fails to return the and part number(s) and other specifications stated in the
purchase order confirmation within 48 hours, Buyer’s purchase order. The documentation shall be completed
purchase order shall be deemed to have been accepted so that each item corresponds to the purchase order with
without comments. Buyer is entitled to cancel the respect to item number, part number, Goods description
purchase order if the purchase order confirmation is not and specifications.
in accordance with the purchase order or if not received
within 48 hours. 4.2 Seller has to submit the Invoice for the supplied Product,
Material Test Report, Warranty Card, Manual of the
2.2 Qualifications made by Seller when confirming the equipment / Product, Accessories, Test Certificate,
purchase order are not part of the Agreement, unless Manufacturer Data Sheet for the supplied Product.
accepted by Buyer in writing.
4.3 All Products will comply with the specifications provided
2.3 This Agreement contains the entire agreement between by buyer. The Seller deemed to have understand the
the parties on the subject matter of this Agreement, and scope of the Supply, I&C as per the requirement of Eltek.
supersedes all representations, undertakings and In case of any doubt / clarification may be taken from the
agreements previously made between the parties with buyer before submitting of the order.
respect to the subject matter of this Agreement. This
General Purchasing Agreement supersedes any general
conditions of purchase/sale and other standard 4.4 Product availability and End of Life (EOL),
conditions. The Appendices shall be an integral part of if the Seller decides to phase out any of the products
this General Purchasing Agreement. covered by this agreement the Seller commits to provide
a list of such products minimum 18 months before the
2.4 Tax and Duties should be mentioned separately in the products EOL. This EOL list must contain product
invoice. Seller must mentioned all the details on the description; part no. and last time buy information.
quotation and invoices e.g Sales Tax Registration No.,
Excise Details, Service Tax No & PAN No.

2.5 However any specific terms and condition mentioned on

the face of Purchase Order if contradicts to the terms &
conditions mentioned here, then those terms mentioned
in Purchase Order will supersedes.

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5 QUALITY ASSURANCE AND ENVIRONMENTAL
MANAGEMENT 8.3 Unless otherwise stated in the Agreement, the effect of
the variation order shall be agreed in writing between
5.1 Seller will comply with any quality control standard the parties. The price shall reflect the price level of the
communicated to Seller by Buyer. Seller will use appropriate original purchase order.
procedures and methods to maintain consistent product
quality and full compliance with the Specifications. Buyer 8.4 At the request of Buyer, the variation order shall be
may, at its option, inspect Products prior to shipment, visit implemented without undue delay, irrespective of
and inspect the facility where the Products and their whether or not the parties have agreed regarding the
components are manufactured or assembled. effect of the variation on the Agreement.

5.2 Buyer reserves the right to approve and carry out audits
of the quality assurance and environmental management 9 RESCHEDULING AND CANCELLATION
system of Seller or any sub-contractors. Seller shall provide
any necessary assistance in this respect. 9.1 Rescheduling Window. The Purchase Order is binding
for both Parties, unless agreed in writing between both
parties before shipment. The Buyer may at any time, by
6 PRICE, PAYMENT AND AUDIT written notice issued at least one (1) working day before
shipment of any Products, reschedule the Delivery Dates
6.1 The Price is fixed and firm and shall not be subject to for such Products to a maximum of ninety (90) calendar
escalation. The Price(s) are stated in the Appendices hereto days after the original Delivery Date.
unless otherwise agreed. Changes in Price(s) shall be
mutually agreed and negotiated in good faith.
9.2 Cancellation Window. The Buyer may at any time, by written
notice issued at least one (1) week before shipment of any
6.2 Unless otherwise agreed, payment shall be made not Products cancel the Delivery Dates for such Products.
later than 120 days from receipt of a correct invoice. Unless
otherwise agreed, invoice shall be issued upon delivery.
Buyer is entitled to withhold disputed parts of the invoice. 10 WARRANTIES AND LIABILITIES

10.1 W arranty period. The Seller guarantees that each and every
7 INSPECTION Product delivered to the Buyer is new, free of defects in
the material and components used, and complies with
7.1 Before delivery, Seller shall search for errors or defects in specifications and workmanship, technical and other
the Goods and the documentation, and shall notify Buyer applicable standards as well as condition under this
without undue delay if errors or defects are identified. Agreement. This warranty shall apply for ------- months from
date of delivery from the Seller to the Buyer. Costs of
7.2 Buyer and any person authorized by him shall be entitled to returning Products to the Seller in order to replace and/or
perform inspections and tests at Seller’s and any sub- fixing defects of the defected Product in the warranty
contractor’s premises as he deems necessary to ensure that period of ---------- months are borne by the Seller.
the Goods are delivered in accordance with the Agreement.
Seller shall provide any assistance necessary in this For replacement within the warranty period the Seller will
respect. Likewise Buyer may request the submission of test replace or repair the Products at the expense of the
records, material certificates, calculations etc. Seller and the Seller shall cover all delivery costs, taxes and
duties payable for said replacements or component parts
7.3 The inspections and tests mentioned above shall not delivered to the site / warehouse of the Buyer. The costs
relieve Seller from any of his obligations under the include all labor costs and other associated costs of third
Agreement. This also applies if Seller sends technical parties for the repair/replacement to be carried out.
documentation or other documents to Buyer for
inspection and possible approval The Costs of returning Products with in the warranty
period are borne by the Seller. The Seller will replace or
repair the products as defined in this agreement within a
8 VARIATION ORDERS reasonable time frame, how ever no event later than within
one (1) month from notice of such defect or damage by the
8.1 Buyer is entitled to make any variations to the Goods, or Buyer.
part thereof. Such variations may include increase or
reduction of scope of supply, character, quality, nature or For any repair work beyond the ------------ months warranty
design as well as change of delivery time, provided that such period, the Seller will repair the Products at negotiated price
variations are within what the parties could reasonably for the Buyer. The Costs of returning Products beyond the
expect when entering into the Agreement. The variation warranty period are borne by the Buyer.
will be formalized by Buyer’s issuance of a written variation
order. Seller’s obligation under this Agreement applies to all 10.2 The Product shall be deemed to have defects if it does not
variations to the Goods. meet the criteria set in this Agreement (especially but not
limited to the warranties mentioned in previous section) and
8.2 Prior to issuance of a variation order, Seller shall, upon other applicable technical, product, quality and other
Buyer’s request and without delay, prepare and send to applicable specifications which the Product shall have
Buyer an estimate describing the variation work, and inform pursuant to or on the basis of this Agreement (e.g.
about possible effects on Price and delivery time. If Seller notification of technical standards, etc.).
does not prepare an estimate as prescribed, Seller has
thereby confirmed that the variation does not increase the 10.3 Seller to submit the PBG issued by any reputed Bank, in
Price or the delivery time. requisite format (to be provided by Eltek), wherever
applicable.
10.4 The Buyer may inspect the delivered Products and 12 TERMINATION
examine whether they have any defects after the
Products are delivered to the place of final destination 12.1 Buyer may terminate this Purchasing Agreement for
specified in the Purchase Order. If the Buyer discovers convenience with at least (18) months’ prior written
defects in the delivered Products, the Buyer is obliged to notice.
notify the Seller of such fact without undue delay from
their delivery. 12.2 Buyer may terminate this Purchasing Agreement
. forthwith in writing if the other Party:
10.5 Epidemic Failure Warranty – “Epidemic Failure” means (i) becomes insolvent, is declared bankrupt, suffers other
that more than 3% of the total installed base of the same similar proceeding or discontinues its business;
type of Products has experienced the same type of or
failure to conform to the applicable Specifications, and (ii) is in breach of any of its obligations under this Purchasing
such failure materially affects Product Agreement and has failed to remedy such breach within
functionality. Seller warrants that the Products will not thirty (30) days after having received written notice of such
experience Epidemic Failure for a period equal to two (2) breach and the intention of the notifying Party to
times the length of the applicable Product Warranty terminate this Supply Agreement if the breach is not timely
Period (Epidemic Failure Warranty). Unless otherwise remedied.
agreed in writing by the parties, if an Epidemic Failure
occurs, upon notice from the Buyer who will instruct the In addition to what is mentioned above Buyer has the right
Seller to – to terminate this Agreement in case Seller sells all or
(a) at Seller’s expense, remove from the field and place substantially all of its assets, merges or consolidates with a
in the buyers storage locations all units of the product third party or suffers a material change of ownership.
under Epidemic Failure Warranty (Covered Products);
(b) refund payments made by buyer for Covered 12.3 The termination of this Agreement shall survive any
Products; termination with regard to Product(s) already delivered under
(c) cancel all invoices for the Product; and, this Agreement.
(d) at Seller’s expense, provide a rapid solution until a
replacement Product is available. 12.4 The Buyer is entitled to Claim actual damages from the Seller
In addition, the buyer may cancel all outstanding P.O.s, in case where this Seller has breached this Agreement or any
Blanket Orders and Releases for the Products without provision thereof.
further obligation.
(e) at Sellers expense purchase product from a third
party as a direct replacement of Sellers product. 13 FORCE MAJEURE

10.6 Seller shall ensure that it and its suppliers have sufficient 13.1 Any failure of Buyer or Seller to comply with the terms of this
insurance (e.g. business interruption and liability Agreement if such failure is caused by circumstances not
insurances) to meet the potential warranty and liability directly under the control of the party concerned, including but
agreed in this contract. Seller shall actively work with its not limited to, failures resulting from Force Majeure, Acts of
suppliers with risk management. Seller shall use God, natural disasters, storm, flood, earthquake, explosion,
commercially reasonable efforts to safeguard that acts of the public enemy, war, rebellion, insurrection,
production of so-called critical components is not located sabotage, epidemic, quarantine restrictions, riots,
to a single location. transportation embargoes, boycotts, failures or delays in
transportation or the mails, acts of any government, whether
10.7 MTBF, The Seller shall ensure that the MTBF for the national, state, local or otherwise, or any agency thereof, or
products within this contract meet the specifications and judicial action, shall be excused for performance continues,
requirements in line with the expectations to the market provided that the non-performing Party makes a reasonable
and application and in line with the Buyers requirements. effort to anticipate the effect of the intervening condition, and
promptly performs when said condition ceases to exist.

11 DELAYS
14 CONFIDENTIALITY AND PUBLICITY
11.1 Time shall be of the essence in relation to all delivery
deadlines. If the Seller fails to meet a first confirmed 14.1 Seller agrees that it will keep confidential about their
DELIVERY DATE the Buyer may either claim actual Purchase Order information and not to disclose to any
damages or Buyer may claim liquidated damages in the third party. Also agree not to share Buyer’s technical data
amount of point five (0.5) % Per day of the price of the / drawing and any other buyer’s property to third party.
delayed delivery for each calendar day of delay
computed from the DELIVERY DATE without grace 15 HEALTH, SAFETY AND ENVIRONMENT
period, up to an aggregated payment per individual
purchase agreement of ten (10) % of the price of the 15.1 Seller shall comply with all applicable rules, regulation
delayed delivery. Additionally, the Buyer may claim any and standards regarding health, safety and environment
costs of air transportation of the delayed delivery. Such and comply with all the requirements from local
air transportation shall be arranged by Seller and the authorities through all the production phases until the
cost shall be borne by Seller. After 10 days of delay the Goods have been delivered. Seller shall comply with
Buyer may cancel any PURCHASE ORDER without requirements from Buyer and Buyer’s customer regarding
setting any new time limit or grace period. Such health, safety and environment.
liquidated damages represent a genuine pre-estimate by
the PARTIES of the expected loss or damage to Seller shall hold all necessary permits and comply with all
ORDERING PARTY and are not intended in any way to requirements from public authorities for the preservation
operate as a penalty. This should extend to all LATE of the environment at all stages of production up to
delivered products and parts. delivery of the Goods.
16 ASSIGNMENTS AND SUB-CONTRACTS

16.1 Seller may not assign the Agreement or any part thereof,
or conclude any sub-contracts without the prior written
consent of Buyer. Limited use of hired manpower, and
minor purchases do not require Buyer’s consent.

161.2 Buyer may assign, wholly or in part, its rights and

obligations under this Agreement to a third party.

17 INDIAN LAW DISPUTES

17.1 This Agreement shall be governed by and interpreted in

accordance with Indian Law.

17.2 Arbitration. Any disputes arising out of or in connection

with this Agreement, including the disputes concerning
its validity, interpretation or annulment, shall be settled
under DELHI jurisdiction and shall be conducted in the
English language.

All awards may if necessary be enforced by any court

having jurisdiction in the same manner as a judgment in
such court.

Both Parties agree that all arbitral proceedings

conducted under this article shall be kept confidential,
and all information, documentation, materials shall be
used solely for the purpose of those proceedings.