Manufacturing Supply Agreement (California)

MANUFACTURING SUPPLY AGREEMENT

(California)

Effective Date: [__/__/____] (the "Effective Date")

PARTIES

Buyer:

Supplier (Manufacturer):

RECITALS

WHEREAS, Supplier is engaged in the business of manufacturing certain products and possesses the expertise, equipment, facilities, and personnel necessary to manufacture and supply the Products (as defined below);

WHEREAS, Buyer desires to purchase and Supplier desires to manufacture, sell, and supply the Products to Buyer on the terms and conditions set forth herein;

WHEREAS, this Agreement is governed by Division 2 of the California Commercial Code (UCC Article 2 - Sales), Cal. Com. Code 2101 et seq., as a transaction involving the sale of goods; and

WHEREAS, the Parties desire to set forth their respective rights, obligations, and responsibilities with respect to the manufacture, supply, purchase, and sale of the Products;

NOW, THEREFORE, in consideration of the mutual covenants, agreements, and promises set forth herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:

TABLE OF CONTENTS

1. Definitions
2. Products and Specifications
3. Forecasting and Orders
4. Pricing
5. Payment Terms
6. Delivery and Shipping
7. Inspection and Acceptance
8. Warranties
9. Quality and Compliance
10. Tooling and Molds
11. Intellectual Property and Confidentiality
12. Indemnification
13. Insurance
14. Force Majeure
15. Term and Termination
16. Transition and Last-Time-Buy
17. Governing Law
18. Dispute Resolution
19. General Provisions
20. Signatures
21. Exhibits

ARTICLE 1. DEFINITIONS

1.1 "Affiliate" means any entity that directly or indirectly controls, is controlled by, or is under common control with a Party.

1.2 "Buyer-Furnished Property" means any tooling, molds, dies, fixtures, materials, designs, drawings, specifications, or other property furnished by Buyer to Supplier for use in the manufacture of Products.

1.3 "Conforming Products" means Products that conform in all material respects to the Specifications, applicable Purchase Orders, and the warranties set forth in this Agreement.

1.4 "Defective Products" means Products that fail to conform to the Specifications, contain defects in materials or workmanship, or otherwise fail to meet the warranties set forth in this Agreement.

1.5 "Delivery Date" means the date specified in a Purchase Order for delivery of Products.

1.6 "Forecast" means the rolling estimate of Buyer's anticipated requirements for Products as described in Article 3.

1.7 "Goods" means all things (including specially manufactured goods) which are movable at the time of identification to the contract for sale, as defined in Cal. Com. Code 2105.

1.8 "Lead Time" means the period between Supplier's receipt of a Purchase Order and the required Delivery Date, as specified in Exhibit B.

1.9 "Products" means the goods described in Exhibit A, manufactured by Supplier in accordance with the Specifications.

1.10 "Purchase Order" or "PO" means a written order issued by Buyer to Supplier for Products pursuant to this Agreement.

1.11 "Specifications" means the detailed technical requirements, drawings, standards, quality criteria, and other parameters for the Products as set forth in Exhibit A, as may be amended from time to time in writing by mutual agreement.

ARTICLE 2. PRODUCTS AND SPECIFICATIONS

2.1 Products. Supplier shall manufacture and supply to Buyer the Products described in Exhibit A (Product Specifications) in accordance with the Specifications and the terms and conditions of this Agreement.

2.2 Specifications. All Products shall strictly conform to the Specifications set forth in Exhibit A. Supplier shall not deviate from the Specifications without Buyer's prior written approval.

2.3 Changes to Specifications. Either Party may propose changes to the Specifications through a written Engineering Change Order ("ECO"). No change shall be effective until both Parties have agreed in writing to the revised Specifications and any corresponding adjustments to pricing, lead times, or other terms.

2.4 Component Substitutions. Supplier shall not substitute any component, material, or sub-assembly used in the manufacture of Products without Buyer's prior written consent, regardless of whether the proposed substitute is deemed equivalent.

2.5 Exhibit Reference. The Products, Specifications, and associated documentation are described in detail in:

• Exhibit A -- Product Specifications and Drawings

ARTICLE 3. FORECASTING AND ORDERS

3.1 Rolling Forecast. Buyer shall provide Supplier with a rolling [________________________________]-month forecast of its anticipated Product requirements (the "Forecast"), updated on a [________________________________] basis (monthly/quarterly). The Forecast is provided for planning purposes only and does not constitute a commitment to purchase, except as set forth below.

3.2 Binding Forecast Period. The first [________________________________] months of each Forecast shall be binding upon Buyer ("Binding Forecast Period"). Buyer shall be obligated to issue Purchase Orders for quantities within the Binding Forecast Period, subject to a variance of plus or minus [____]%.

3.3 Non-Binding Forecast Period. The remaining months of each Forecast beyond the Binding Forecast Period shall be non-binding estimates provided for Supplier's planning purposes only.

3.4 Purchase Orders. Buyer shall issue Purchase Orders at least [________________________________] days prior to the requested Delivery Date. Each Purchase Order shall specify:

(a) Product identification and part numbers;
(b) Quantities ordered;
(c) Unit price (per Exhibit B);
(d) Requested Delivery Date;
(e) Shipping instructions and destination; and
(f) Any special instructions or requirements.

3.5 Acceptance of Purchase Orders. Supplier shall accept or reject each Purchase Order within [____] business days of receipt. If Supplier does not respond within such period, the Purchase Order shall be deemed accepted. Supplier may reject a Purchase Order only if it materially deviates from the terms of this Agreement. Pursuant to Cal. Com. Code 2207, additional or different terms in a Purchase Order or acknowledgment shall not become part of this Agreement unless expressly agreed to in writing by both Parties.

3.6 Minimum Order Quantities. The minimum order quantity for each Product is set forth in Exhibit B.

3.7 Lead Times. Standard lead times for each Product are set forth in Exhibit B. Supplier shall use commercially reasonable efforts to accommodate expedited orders upon Buyer's request.

ARTICLE 4. PRICING

4.1 Prices. The unit prices for the Products are set forth in Exhibit B (Pricing Schedule). All prices are stated in United States Dollars unless otherwise specified.

4.2 Price Table. Prices are based on the volume tiers specified in Exhibit B. Volume discounts, if any, shall apply as set forth therein.

4.3 Price Adjustments. Prices shall remain fixed for the initial [________________________________] months of the Term. Thereafter, either Party may request a price adjustment by providing at least [________________________________] days' written notice. Price adjustments shall be based on documented changes in:

(a) Raw material costs;
(b) Labor costs;
(c) Energy costs; or
(d) Regulatory compliance costs.

No price increase shall exceed [____]% in any twelve-month period without Buyer's written consent.

4.4 Most-Favored-Customer. Supplier represents and warrants that the prices charged to Buyer under this Agreement are no less favorable than the prices charged by Supplier to any other customer for comparable products in comparable quantities. If Supplier offers more favorable pricing to another customer for comparable products, Supplier shall promptly offer the same pricing to Buyer.

4.5 Cost Reduction. The Parties shall cooperate in good faith to identify and implement cost reduction opportunities. Cost savings resulting from Buyer-initiated improvements shall be shared [____]% to Buyer and [____]% to Supplier.

ARTICLE 5. PAYMENT TERMS

5.1 Invoicing. Supplier shall submit invoices to Buyer upon shipment of Products. Each invoice shall reference the applicable Purchase Order number and include supporting documentation.

5.2 Payment. Buyer shall pay undisputed invoices within [________________________________] days after receipt of a conforming invoice (e.g., Net 30, Net 45, Net 60).

5.3 Disputed Invoices. If Buyer disputes any portion of an invoice in good faith, Buyer shall pay the undisputed portion within the payment period and notify Supplier in writing of the disputed amount with reasonable detail. The Parties shall work in good faith to resolve the dispute within thirty (30) days.

5.4 Late Payment Interest. Undisputed amounts not paid when due shall bear interest at the rate of [____]% per annum or, if no rate is specified in this Agreement, at ten percent (10%) per annum pursuant to Cal. Civ. Code 3289(b), from the date payment was due until paid. NOTE: Under Cal. Civ. Code 3289(b), if a contract entered into after January 1, 1986, does not stipulate a legal rate of interest, the obligation bears interest at 10% per annum after breach.

5.5 Setoff. Buyer may set off any amounts owed to Buyer by Supplier under this Agreement against amounts payable to Supplier.

5.6 Taxes. Unless otherwise stated, prices do not include sales, use, excise, or similar taxes. Buyer shall be responsible for all applicable taxes, provided that Supplier shall invoice such taxes separately.

ARTICLE 6. DELIVERY AND SHIPPING

6.1 Delivery Terms. Unless otherwise specified in a Purchase Order, all Products shall be delivered:

☐ EXW (Ex Works) -- Supplier's facility
☐ FCA (Free Carrier) -- [________________________________]
☐ FOB Origin -- Supplier's shipping point
☐ FOB Destination -- Buyer's designated facility
☐ DDP (Delivered Duty Paid) -- Buyer's facility
☐ Other Incoterms 2020: [________________________________]

6.2 Risk of Loss. Risk of loss shall pass from Supplier to Buyer in accordance with the delivery terms selected above and Cal. Com. Code 2509. If the contract requires Supplier to ship the Products by carrier and does not require delivery at a particular destination, risk of loss passes to Buyer when the Products are duly delivered to the carrier (per Cal. Com. Code 2509(1)(a)). If the contract requires delivery at a particular destination, risk of loss passes when the Products are duly tendered at the destination (per Cal. Com. Code 2509(1)(b)).

6.3 Title. Title to conforming Products shall pass to Buyer simultaneously with the passage of risk of loss, subject to Supplier's retention of a security interest until full payment is received, if applicable.

6.4 Packaging and Labeling. Supplier shall package and label all Products in accordance with Buyer's written instructions, applicable regulations (including California Proposition 65 warnings where required), and industry standards.

6.5 Shipping Documentation. Each shipment shall be accompanied by a packing slip identifying the Purchase Order number, product descriptions, quantities, lot/batch numbers, and any required certificates of conformance.

6.6 On-Time Delivery. Supplier shall deliver Products on or before the Delivery Date specified in each Purchase Order. Supplier shall promptly notify Buyer of any anticipated delay. If Supplier fails to meet the Delivery Date, Buyer may, without limiting its other remedies:

(a) Require Supplier to expedite shipment at Supplier's expense;
(b) Cancel the affected Purchase Order without liability; or
(c) Source replacement Products from an alternative supplier, with Supplier liable for any incremental costs.

ARTICLE 7. INSPECTION AND ACCEPTANCE

7.1 Buyer's Right to Inspect. Pursuant to Cal. Com. Code 2513, Buyer shall have the right to inspect Products at any reasonable time and place before acceptance, including at Supplier's facility prior to shipment upon reasonable notice.

7.2 Inspection Period. Buyer shall have [________________________________] business days after receipt of Products at the delivery destination to inspect and either accept or reject the Products (the "Inspection Period").

7.3 Acceptance. Products shall be deemed accepted if Buyer does not provide written notice of rejection within the Inspection Period. Acceptance does not waive any warranty rights or claims for latent defects.

7.4 Rejection. If Products fail to conform to the Specifications, Purchase Order, or warranties, Buyer may reject such Products by providing Supplier with written notice specifying the nonconformity, pursuant to Cal. Com. Code 2602. Rejected Products shall be held by Buyer at Supplier's risk and expense pending Supplier's return shipping instructions.

7.5 Cure. Pursuant to Cal. Com. Code 2508, if Supplier delivers nonconforming Products before the Delivery Date, Supplier may cure the nonconformity by providing conforming Products within the time allowed for performance.

7.6 Revocation of Acceptance. Buyer may revoke acceptance of Products in accordance with Cal. Com. Code 2608 if a nonconformity substantially impairs the value of the Products to Buyer, provided that (a) Buyer accepted the Products on the reasonable assumption that the nonconformity would be cured and it has not been seasonably cured, or (b) Buyer accepted without discovery of the nonconformity if acceptance was reasonably induced by the difficulty of discovery or by Supplier's assurances.

7.7 Return Material Authorization. Supplier shall issue a Return Material Authorization ("RMA") within [____] business days of receiving Buyer's rejection notice. Supplier shall bear all freight costs for the return and replacement of Defective Products.

ARTICLE 8. WARRANTIES

8.1 Express Warranty. Supplier warrants that all Products delivered under this Agreement shall:

(a) Conform to the Specifications set forth in Exhibit A;
(b) Be new and of first-quality materials and workmanship;
(c) Be free from defects in design (to the extent Supplier designed the Product), materials, and workmanship;
(d) Be merchantable and fit for the particular purpose known to Supplier;
(e) Be free and clear of all liens, encumbrances, and security interests; and
(f) Comply with all applicable federal, state, and local laws, regulations, and standards, including California Proposition 65 (Cal. Health & Safety Code 25249.5 et seq.).

8.2 Warranty Period. The warranty period shall be [________________________________] months from the date of delivery to Buyer or [________________________________] months from the date of installation or first use by Buyer's end customer, whichever occurs first.

8.3 Implied Warranties. The implied warranty of merchantability under Cal. Com. Code 2314 and the implied warranty of fitness for a particular purpose under Cal. Com. Code 2315 are incorporated into this Agreement and shall apply to all Products. These implied warranties supplement, and do not limit, the express warranties set forth herein.

8.4 Warranty Remedies. If any Product fails to conform to the warranties during the Warranty Period, Supplier shall, at Buyer's election:

(a) Repair the Defective Product at Supplier's expense;
(b) Replace the Defective Product with a Conforming Product at Supplier's expense; or
(c) Refund the purchase price for the Defective Product.

Supplier shall bear all costs associated with warranty claims, including freight, labor, and materials.

8.5 Warranty Limitations. Select applicable limitation:

☐ THE WARRANTIES SET FORTH IN THIS ARTICLE CONSTITUTE BUYER'S SOLE AND EXCLUSIVE WARRANTIES. ALL OTHER WARRANTIES, EXPRESS OR IMPLIED, INCLUDING BUT NOT LIMITED TO THE IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE, ARE HEREBY DISCLAIMED TO THE MAXIMUM EXTENT PERMITTED BY CALIFORNIA LAW. NOTE: Under Cal. Com. Code 2316, exclusion or modification of implied warranties must be conspicuous and use specific language.

☐ No limitation on warranties applies; all express and implied warranties are fully retained.

ARTICLE 9. QUALITY AND COMPLIANCE

9.1 Quality Management System. Supplier shall maintain a quality management system that meets or exceeds the following standard(s):

☐ ISO 9001
☐ ISO 13485 (medical devices)
☐ IATF 16949 (automotive)
☐ AS9100 (aerospace)
☐ Other: [________________________________]

9.2 Quality Requirements. Supplier shall comply with the quality requirements set forth in Exhibit C (Quality Requirements). Supplier shall maintain statistical process controls, conduct incoming material inspections, and perform in-process and final inspections as specified.

9.3 Certificates of Conformance. Supplier shall provide a Certificate of Conformance with each shipment, certifying that the Products comply with the Specifications and all applicable quality requirements.

9.4 Audit Rights. Buyer shall have the right, upon reasonable notice (not less than [____] business days), to audit and inspect Supplier's manufacturing facilities, quality systems, records, and processes.

9.5 California-Specific Regulatory Compliance. Supplier shall comply with all applicable federal, state, and local laws, regulations, and standards, including without limitation:

(a) California Proposition 65 (Safe Drinking Water and Toxic Enforcement Act, Cal. Health & Safety Code 25249.5 et seq.) -- Supplier shall provide all required Proposition 65 warnings and certify that Products comply with Proposition 65 requirements;
(b) California Transparency in Supply Chains Act (Cal. Civ. Code 1714.43) -- Supplier shall cooperate with Buyer's supply chain transparency efforts;
(c) RoHS/REACH (if applicable);
(d) OSHA and Cal/OSHA workplace safety requirements;
(e) California Environmental Quality Act (CEQA) requirements, as applicable; and
(f) All other applicable California state regulations.

9.6 Traceability. Supplier shall maintain lot/batch traceability records for all Products and components for a period of not less than [________________________________] years after delivery.

9.7 Corrective Action. Upon discovery of any quality deficiency, Supplier shall promptly implement corrective and preventive action and provide Buyer with a written corrective action report within [____] business days.

ARTICLE 10. TOOLING AND MOLDS

10.1 Ownership. All tooling, molds, dies, fixtures, jigs, and gauges (collectively, "Tooling") paid for in whole or in part by Buyer shall be and remain the exclusive property of Buyer. Supplier shall mark all Buyer-owned Tooling with Buyer's ownership identification.

10.2 Use Restrictions. Supplier shall use Buyer-owned Tooling solely for the manufacture of Products for Buyer and shall not use such Tooling for any other purpose or for any third party without Buyer's prior written consent.

10.3 Maintenance. Supplier shall maintain all Tooling in good working condition at Supplier's expense, performing regular preventive maintenance and repairs as necessary. Supplier shall promptly notify Buyer of any damage to or deterioration of Tooling.

10.4 Insurance. Supplier shall insure all Buyer-owned Tooling against loss, damage, and destruction at replacement value, with Buyer named as loss payee.

10.5 Return of Tooling. Upon expiration or termination of this Agreement, or upon Buyer's written request, Supplier shall promptly return all Buyer-owned Tooling to Buyer in good working condition, ordinary wear and tear excepted.

ARTICLE 11. INTELLECTUAL PROPERTY AND CONFIDENTIALITY

11.1 Buyer IP. All intellectual property rights in Buyer's designs, specifications, drawings, and other materials provided to Supplier are and shall remain the exclusive property of Buyer.

11.2 Supplier IP. All intellectual property rights in Supplier's pre-existing technology, manufacturing processes, and know-how are and shall remain the exclusive property of Supplier.

11.3 Developed IP. Intellectual property developed jointly by the Parties in connection with this Agreement shall be owned as follows:

☐ Solely by Buyer
☐ Solely by Supplier
☐ Jointly by both Parties
☐ As specified in a separate IP agreement

11.4 Confidentiality. Each Party shall maintain the confidentiality of the other Party's proprietary information and shall not disclose such information to any third party without the prior written consent of the disclosing Party, except as required by law. Confidentiality obligations shall survive termination of this Agreement for a period of [________________________________] years. Trade secret protections under the California Uniform Trade Secrets Act (Cal. Civ. Code 3426 et seq.) shall apply.

ARTICLE 12. INDEMNIFICATION

12.1 Supplier Indemnification. Supplier shall defend, indemnify, and hold harmless Buyer and its Affiliates, and their respective directors, officers, employees, and agents from and against any and all claims, losses, damages, liabilities, costs, and expenses (including reasonable attorneys' fees) arising out of or relating to:

(a) Any defect in the Products (product liability);
(b) Supplier's breach of any warranty or representation under this Agreement;
(c) Any claim that the Products (other than Products manufactured to Buyer's exclusive design) infringe any patent, copyright, trademark, trade secret, or other intellectual property right of a third party;
(d) Supplier's negligence or willful misconduct;
(e) Supplier's violation of any applicable law, regulation, or standard, including California Proposition 65; or
(f) Any product recall attributable to Supplier's defective Products.

12.2 Buyer Indemnification. Buyer shall defend, indemnify, and hold harmless Supplier and its Affiliates from and against any and all claims, losses, damages, liabilities, costs, and expenses (including reasonable attorneys' fees) arising out of:

(a) Any claim that Products manufactured to Buyer's exclusive design or specifications infringe any third-party intellectual property right; or
(b) Buyer's negligence or willful misconduct.

12.3 Indemnification Procedures. The indemnified Party shall promptly notify the indemnifying Party of any claim, permit the indemnifying Party to control the defense, and cooperate in the defense at the indemnifying Party's expense.

ARTICLE 13. INSURANCE

13.1 Required Coverage. Supplier shall maintain, at its own expense, the following insurance coverage throughout the Term:

13.2 Additional Insured. Buyer shall be named as an additional insured on Supplier's commercial general liability and products liability policies.

13.3 Certificates. Supplier shall provide Buyer with certificates of insurance evidencing the required coverage upon execution of this Agreement and annually thereafter.

13.4 Notice of Cancellation. Supplier shall provide Buyer with at least thirty (30) days' prior written notice of any cancellation, material modification, or non-renewal of any required insurance policy.

ARTICLE 14. FORCE MAJEURE

14.1 Definition. "Force Majeure Event" means any event beyond the reasonable control of the affected Party, including without limitation: acts of God, fire, flood, earthquake, hurricane, wildfire, epidemic, pandemic, war, terrorism, civil unrest, government sanctions, embargo, labor strikes (not involving the affected Party's own employees), power outages, or failure of third-party telecommunications.

14.2 Excuse of Performance. Neither Party shall be liable for any delay or failure to perform its obligations under this Agreement to the extent caused by a Force Majeure Event, provided that the affected Party:

(a) Provides written notice to the other Party within [____] business days of the occurrence;
(b) Uses commercially reasonable efforts to mitigate the effects; and
(c) Resumes performance promptly after the Force Majeure Event ceases.

14.3 Extended Force Majeure. If a Force Majeure Event continues for more than [________________________________] consecutive days, the non-affected Party may terminate this Agreement or any affected Purchase Order upon written notice without liability.

14.4 No Excuse for Payment. Force Majeure shall not excuse Buyer's obligation to pay for Products already delivered and accepted.

ARTICLE 15. TERM AND TERMINATION

15.1 Initial Term. This Agreement shall commence on the Effective Date and shall continue for an initial term of [________________________________] years (the "Initial Term"), unless earlier terminated in accordance with this Article.

15.2 Renewal. Upon expiration of the Initial Term, this Agreement shall automatically renew for successive [________________________________]-year periods (each, a "Renewal Term"), unless either Party provides written notice of non-renewal at least [________________________________] days prior to the expiration of the then-current term.

15.3 Termination for Cause. Either Party may terminate this Agreement upon written notice if the other Party:

(a) Materially breaches this Agreement and fails to cure such breach within [________________________________] days after receipt of written notice;
(b) Becomes insolvent, files for bankruptcy, or has a petition for bankruptcy filed against it;
(c) Makes a general assignment for the benefit of creditors; or
(d) Ceases to conduct business in the ordinary course.

15.4 Termination for Convenience. Either Party may terminate this Agreement for convenience upon [________________________________] days' prior written notice to the other Party.

15.5 Effect of Termination. Upon termination:

(a) All outstanding Purchase Orders issued prior to the effective date of termination shall be fulfilled, unless otherwise agreed;
(b) Buyer shall pay Supplier for all conforming Products delivered and accepted prior to termination;
(c) Supplier shall return all Buyer-Furnished Property within [____] days; and
(d) Articles 8, 11, 12, 13, 17, and 18 shall survive termination.

ARTICLE 16. TRANSITION AND LAST-TIME-BUY

16.1 Transition Assistance. Upon expiration or termination of this Agreement, Supplier shall provide reasonable transition assistance to Buyer for a period of [________________________________] days, including continued supply of Products, transfer of Buyer-owned Tooling, and cooperation with Buyer's replacement supplier.

16.2 Last-Time-Buy. Before discontinuing production of any Product, Supplier shall provide Buyer with at least [________________________________] days' written notice and offer Buyer the opportunity to place a final "last-time-buy" order at the then-current pricing.

16.3 Inventory Buy-Back. Upon termination, Buyer shall purchase Supplier's inventory of finished Products, work-in-process, and dedicated raw materials procured in reliance on Buyer's Binding Forecast, at Supplier's documented cost.

ARTICLE 17. GOVERNING LAW

17.1 This Agreement shall be governed by, and construed and enforced in accordance with, the laws of the State of California, including the California Commercial Code, Division 2 (Sales), Cal. Com. Code 2101 et seq., without regard to conflicts of law principles.

17.2 The United Nations Convention on Contracts for the International Sale of Goods (CISG) shall not apply to this Agreement.

ARTICLE 18. DISPUTE RESOLUTION

18.1 Escalation. The Parties shall first attempt to resolve any dispute through good-faith negotiations between senior management representatives for a period of thirty (30) days after written notice.

18.2 Mediation. If the dispute is not resolved through negotiation, the Parties shall submit the dispute to non-binding mediation in [________________________________], California.

18.3 Litigation or Arbitration. If the dispute is not resolved through mediation within sixty (60) days:

☐ Litigation. Either Party may commence litigation in the state or federal courts located in [________________________________] County, California. Each Party irrevocably consents to the exclusive jurisdiction and venue of such courts.

☐ Arbitration. The dispute shall be resolved by binding arbitration administered by JAMS in [________________________________], California, in accordance with its Comprehensive Arbitration Rules.

18.4 Jury Trial Waiver. EACH PARTY HEREBY IRREVOCABLY WAIVES ANY RIGHT TO A TRIAL BY JURY IN ANY ACTION ARISING OUT OF OR RELATING TO THIS AGREEMENT. NOTE: California courts generally enforce jury trial waivers in commercial contracts if entered into knowingly and voluntarily. See Grafton Partners v. Superior Court, 36 Cal. 4th 944 (2005).

18.5 Prevailing Party. The prevailing Party in any dispute shall be entitled to recover its reasonable attorneys' fees and costs from the non-prevailing Party.

ARTICLE 19. GENERAL PROVISIONS

19.1 Assignment. Neither Party may assign this Agreement without the prior written consent of the other Party, except to an Affiliate or in connection with a merger, acquisition, or sale of substantially all of the assigning Party's assets.

19.2 Severability. If any provision of this Agreement is held invalid or unenforceable, the remaining provisions shall continue in full force and effect.

19.3 Entire Agreement. This Agreement, together with all Exhibits, Purchase Orders, and written amendments, constitutes the entire agreement between the Parties.

19.4 Amendments. No amendment or modification shall be effective unless in writing and signed by authorized representatives of both Parties.

19.5 Waiver. No waiver of any provision shall constitute a waiver of any other provision or a continuing waiver.

19.6 Notices. All notices shall be in writing and delivered by personal delivery, certified mail, overnight courier, or email with confirmation.

19.7 Independent Contractors. The Parties are independent contractors.

19.8 Counterparts. This Agreement may be executed in counterparts and by electronic signature.

19.9 Order of Precedence. In the event of a conflict, this Agreement shall control over any Purchase Order or Exhibit, unless the Purchase Order or Exhibit expressly states otherwise and is signed by both Parties.

19.10 Statute of Frauds. This Agreement satisfies the writing requirement of Cal. Com. Code 2201 (Statute of Frauds) for contracts for the sale of goods.

SIGNATURES

IN WITNESS WHEREOF, the Parties have executed this Manufacturing Supply Agreement as of the Effective Date.

BUYER:

SUPPLIER:

EXHIBIT A -- PRODUCT SPECIFICATIONS

Attach detailed specifications, drawings, and technical requirements.

EXHIBIT B -- PRICING AND ORDER REQUIREMENTS

EXHIBIT C -- QUALITY REQUIREMENTS

1. Quality Management System Certification: [________________________________]
2. Incoming Material Inspection Requirements: [________________________________]
3. In-Process Inspection Requirements: [________________________________]
4. Final Inspection and Testing Requirements: [________________________________]
5. Statistical Process Control Requirements: [________________________________]
6. Non-Conformance Reporting Procedures: [________________________________]
7. Corrective and Preventive Action Procedures: [________________________________]
8. Traceability and Record Retention Requirements: [________________________________]
9. Proposition 65 Compliance Certification: [________________________________]

SOURCES AND REFERENCES

• Cal. Com. Code Division 2 (UCC Article 2 - Sales)
• Cal. Com. Code 2105 (Definitions: Goods)
• Cal. Com. Code 2201 (Statute of Frauds)
• Cal. Com. Code 2207 (Additional Terms in Acceptance or Confirmation)
• Cal. Com. Code 2314 (Implied Warranty: Merchantability)
• Cal. Com. Code 2315 (Implied Warranty: Fitness for Particular Purpose)
• Cal. Com. Code 2316 (Exclusion or Modification of Warranties)
• Cal. Com. Code 2508 (Cure by Seller)
• Cal. Com. Code 2509 (Risk of Loss)
• Cal. Com. Code 2513 (Buyer's Right to Inspection)
• Cal. Com. Code 2602 (Manner and Effect of Rightful Rejection)
• Cal. Com. Code 2608 (Revocation of Acceptance)
• Cal. Civ. Code 3289 (Interest After Breach of Contract)
• Cal. Health & Safety Code 25249.5 et seq. (Proposition 65)
• Cal. Civ. Code 1714.43 (California Transparency in Supply Chains Act)
• Cal. Civ. Code 3426 et seq. (California Uniform Trade Secrets Act)
• Grafton Partners v. Superior Court, 36 Cal. 4th 944 (2005)
• Incoterms 2020 (International Chamber of Commerce)