3) Entry of Order: Orders are not entered at the factory until payment terms are settled.

PRICE ADJUSTMENTS

Prices stated on sellers acknowledgment for orders, or items or quantities thereupon, are not subject to upward or downward adjustment. Orders will be accepted only if shipment can be scheduled for completion within 18 months after date of order.

QUOTATIONS

Any price, quantity or condition of sale stated in any quotation is effective for 90 days from the date of quotation unless changed by notice. No quotation shall have any force or effect after 90 days from date of quotation, unless effective period of such quotation is expressly extended in writing by seller.

All orders whether or not based upon specific quotations, are subject to acceptance by the seller at its general offices in San Francisco, California.

Seller reserves the right to make design changes for product modernization or improvement subsequent to issuance of quotations.

TAXES, DUTIES OR FEES

When the seller is required to pay or collect sales, use, or other taxes, the amount will be added to the invoice as a separate item.

LOSS, DAMAGE OR DELAY

Shipping dates are approximate and are based upon prompt receipt of all necessary information. Seller is not liable for loss, damage, detention, or delay due to causes beyond its reasonable control such as: acts of

God, acts of the purchaser, acts of civil or military authority, priorities, fires, strikes floods, epidemics, quarantine restrictions, war, riot, delays in transportation, government restrictions or embargoes, or difficulties in obtaining necessary labor, materials and manufacturing facilities due to such causes.

PATENTS

The seller shall defend any suit or preceding brought against the purchaser so far as based on a claim that any product, or any part thereof, sold hereunder constitutes and infringement of any United states patent - other than a claim covering a process or a product thereof - if notified promptly in writing and given authority, information, and assistance (at sellers expense) for the defense of same, and the seller shall pay all damages and costs awarded therein against the purchaser, provided that this agreement shall not extend to any infringement based upon the manufacturer, use, or sale of said product or any part or parts thereof, in combination with apparatus or things not furnished by the seller. In case the product, or any part thereof, furnished hereunder is in such suit held to constitute infringement and its use enjoined, the seller shall, at its own expense and at its option, either (1) procure for the purchaser the right to continue using said product or part thereof; or (2) replace the same with a non-infringing product; or (3) modify it so that it becomes non-infringing; or (4) remove said product and refund the purchase price and the transportation and installation costs thereof. The foregoing states the entire liability of the seller with respect to patent infringement by said product or any part thereof.

The preceding paragraph shall not apply to any equipment or product, or any part thereof, manufactured to purchaser’s design. As to such equipment or product, or any part

thereof, the seller assumes no liability whatsoever for patent infringement.

MODIFICATION, CANCELLATION, OR DEFERMENT BY PURCHASER

Orders or purchase contracts may be modified or canceled, and scheduled shipments may be deferred, only upon purchaser’s prior written notice and upon confirmation by seller’s revised acknowledgment and upon terms, satisfactory to seller, which compensate seller for all damages suffered by reason of such modification, cancellation, or deferment. Any modification, cancellation or deferment hereunder shall become effective no earlier than 15 days after such notice.

CALIFORNIA LAW GOVERNS

All orders are accepted by the seller at its general office in San Francisco, California. The laws of California shall govern the interpretation and effect of all contracts and the rights and remedies of the parties.

ARBITRATION

Any controversy or claim that cannot be settled amicably between purchaser and seller, relating to goods sold hereunder, shall be finally settled by arbitration conducted either outside the United States of America in accordance with the Rules of Arbitration of the International Chamber of Commerce or in the United States of America in accordance with the Rules of the American Arbitration Association. If the parties fail to agree in writing on the place where the arbitration is to be conducted, a final and binding determination of this question shall be made by a Joint Arbitration Location Committee, consisting of three persons, one