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1. ACCEPTANCE OF GOODS, QUANTITY

Within 5 business days after Buyer's receipt of each shipment of the goods, Buyer shall inspect such goods; including counting the number contained in the shipment, and shall notify Seller of any non-conformity of goods or discrepancies in quantity. If Seller receives no such notification within the time period stated above, Buyer shall be deemed to have accepted the goods in such shipment.

2. REMEDIES/WARRANTIES

Seller warrants that the materials shall be free and clear of any liens or encumbrances and shall be free from defects for a period of three (3) years from the date of shipment. Any claim hereunder shall be made, if at all, within three (3) years from the date of shipment, by delivery of written notice from Buyer to Seller within said three (3) year period. Buyer's remedy in the event of a defect in material supplied by Seller shall be limited exclusively to the repair or replacement of such materials by Seller, without charge, which repair or replacement shall be at the option of Seller...

If Buyer claims, in accordance with the terms of Paragraph 1 above or this Paragraph 2, that the materials shipped are defective, Seller reserves the right to send an inspector to Buyer's place of business, to confirm the existence and cause of such defects. In any event, if Seller agrees that such materials are defective, Seller shall issue to Buyer a Return Goods Authorization Number. Buyer shall bear any and all transportation charges incurred in returning materials to Seller and shall be responsible for arranging such transportation. Seller will not accept any returned materials until a Return Goods Authorization number has been issued. In the alternative, Seller hereby reserves the right to instruct Buyer to destroy the defective materials, in which case Seller shall replace such materials

Notwithstanding anything contained to the contrary in this contract or any other document relating to the transaction contemplated hereby, if Buyer rightfully shall reject materials pursuant to the terms of Paragraph 1 or this Paragraph 2, or shall receive from Seller defective or non-conforming materials, Buyer shall not be entitled to set off against any amounts then or thereafter owing by Buyer to Seller under this contract or any other contract between Buyer and Seller or to back charge Seller. Buyer's sole remedy in such case shall be to require Seller to repair or replace (at the option of Seller) such defective or non-conforming materials. Any attempt by Buyer to so offset against such payments or to back charge Seller shall be deemed to be a breach of the terms of this contract, and the amounts which then remain outstanding to Seller shall begin to accrue interest at the highest rate permitted by law and all warranty obligations shall thereafter be null and void. For purposes of this contract, the term "materials" shall refer solely to the components comprising the finished goods. The decomposition by chemical action and wear caused by the presence of abrasive materials shall not constitute defects. Seller assumes no responsibility or expense for repairs made on any of Seller's goods outside Seller's factory without prior written approval by Seller or an authorized representative of Seller.

EXCEPT FOR WARRANTIES EXPRESSLY MADE BY SELLER IN THIS CONTRACT, SELLER HEREBY DISCLAIMS ALL WARRANTIES, EXPRESS OR IMPLIED, INCLUDING, BUT NOT LIMITED TO, THE IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE RELATING TO THE GOODS AND MATERIALS FURNISH PURSUANT TO THIS CONTRACT AND ANY OTHER OBLIGATIONS OR LIABILITY ON THE PART OF SELLER. IN ADDITON, SELLER HEREBY DISCLAIMS ANY RESPONSIBILITY FOR DAMAGES INCURRED BY BUYER AS A RESULT OF (I) ANY FAILURE TO REPORT ANY DEFECTIVE GOODS OR MATERIALS WITHIN THE TIME PERIOD SET FORTH IN PARAGRAPH 1 ABOVE; (II) IMPROPER USE OF THE PRODUCTS ORDERED PURSUANT TO THE TERMS OF THIS ORDER; (III) TAMPERING WITH OR ALTERATION OF ANY PRODUCTS; (IV) DAMAGE IN SHIPMENT; (V) THE EXPENSES OF BUYER INCURRED FOR REWORKING OF THE PRODUCTS; (VI) FAILURE OF BUYER TO PROPERLY MAINTAIN THE MATERIALS AND SYSTEMS IN WHICH THE GOODS AND MATERIALS ARE INTEGRATED; OR (VII) A FAILURE OF MATERIALS SUPPLIED BY THIRD PARTIES OTHER THAN SELLER AND USED BY SELLER IN THE PRODUCTION OF THE GOODS SUBJECT TO THE TERMS OF THIS ORDER. FURTHER, IN NO EVENT, WHETHER BY REASON OF BREACH OF REPRESENTATION OR WARRANTY, BREACH OF CONTRACT, TORTIOUS ACT OR OMISSION OF SELLER, SHALL SELLER HAVE ANY LIABILITY TO BUYER FOR CONSEQUENTIAL, INDIRECT OR INCIDENTAL DAMAGES.

The terms and remedies set forth in this Paragraph 2 are solely for the benefit of Buyer, and shall not be passed on to nor are they for the benefit of any customers of Buyer.