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Terms & Conditions


BW Systems, Inc. ("Company") offers to sell equipment and related startup services, if any (collectively, the “Equipment”), as described in Company’s proposals, quotations, sales orders, and invoices (collectively, “Documents”).  The client, customer, or other party identified in Company’s Documents as the party responsible for payment is referred to in these Terms and Conditions as “Buyer.”  All purchase orders received by Company are subject to acceptance or rejection by Company.  Unless otherwise expressly agreed to in writing by Company, these Terms and Conditions and the Documents to which they are attached (collectively, the “Agreement”) shall supersede any terms contained on Buyer's purchase order or any document or instrument submitted by Buyer.  In the event of any conflict in the terms of any Document, the latest Document provided by Company shall be controlling. 

1. Payment:  Buyer agrees to pay full purchase price as set forth in the Agreement.  Unless otherwise stated in the Agreement, prices are F.O.B. Company’s dock and payment terms are net thirty (30) days after invoice date.  Payments received after the due date shall bear interest at the rate of 1.5% for each month, or portion of month, until paid.  Buyer agrees to pay any reasonable attorneys fees, and other related costs, incurred to enforce payment collection.

2. Taxes, Duties, Customs and Other Fees:  Buyer shall be responsible for the payment of all taxes, duties, and tariffs, as well as permits, licenses, or other government fees relating to or incurred in connection with performance of this Agreement.  If Company is required to prepay any such taxes, duties or fees, Buyer will reimburse Company upon demand.

3. Title Transfer and Risk of Loss; Shipment, Packaging, and Delivery:  All delivery dates stated in any Document are subject to Company’s receipt of necessary parts and supplies from its sources on a timely basis.  Terms of delivery shall be F.O.B. Company’s dock, whereupon title and risk of loss shall pass to Buyer.  Company shall ship Equipment as set forth in the Agreement at the earliest available shipment date.  If the Documents provide for “prepay freight,” Company shall arrange freight and applicable shipping insurance on behalf of Buyer, at the then-current standard or default insurance amounts unless otherwise instructed in writing by Buyer, and all shipping and insurance charges will be included in Company’s final invoice and paid by Buyer.  Otherwise, if the Documents provide for “third-party billing,” Company will schedule shipping with Buyer’s designated third-party carrier and all charges will be Buyer’s direct expense.  In all cases, filing and resolution of any claims with the carrier shall rest with Buyer; upon request, Company shall provide reasonable assistance in filing and resolving claims.  Unless otherwise specified in the Agreement, Buyer shall be solely responsible for unloading, storing, assembling and installing the Equipment.

4. Confidentiality and Ownership of Design Materials:  All manufacturing devices, drawings, specifications, designs, plans, computer programs, pricing and other documents, information and data prepared by Company in connection with performance of this Agreement (collectively, “Company Information”), and all related intellectual property rights, shall be considered proprietary and shall remain the property of Company.  Company grants to Buyer a non-exclusive, non-transferable license for Buyer to use Company Information for Buyer's use, maintenance, or repair of the Equipment, which license shall terminate if Buyer fails to fully pay Company for the Equipment.  In no case shall Buyer provide any Company Information to anyone outside the Buyer's organization without Company’s prior written consent.

5. Changes:  No change orders or other requests for change to the Agreement shall be implemented until agreed to in writing by Buyer and Company.  If Company's obligations are changed, Company shall be entitled to reimbursement for reasonable additional costs incurred as a result of the change.

6. Technical Advice:  Company may, at Buyer’s request and in Company’s sole discretion, furnish technical assistance, advice, and information with respect equipment not supplied by Company.  Such assistance, advice or information shall be provided on an “as is, where is” basis, at Buyer’s risk, and Company shall have no liability with respect thereto.

7. Limited Warranty:  Subject to these Terms and Conditions, Company warrants that the Equipment will conform to the specifications or description, if any, set forth in the Documents and will be free from defects in workmanship for a period of twelve (12) months after shipment.  Any claim under the foregoing warranty must be made in writing to the Company within thirty (30) days after discovery of the alleged nonconformity or defect, and any applicable warranty work will be provided by Company personnel.  In addition to the foregoing, any hardware supplied as part of an integrated system shall bear the individual component manufacturer’s warranty as provided to Company.  If a hardware component fails during the applicable warranty period for a warrantied reason, Company will provide reasonable assistance in coordinating the applicable warranty repair or replacement.  The foregoing warranties shall not apply to normal wear and tear, decomposition by chemical action, wear caused by the presence of abrasive materials or damages caused in transit or by misuse, neglect, accident, improper installation, negligence, or abuse or by abnormal conditions of temperature, moisture or dirt.



Company's liability and Buyer's sole and exclusive remedy for any breach of warranty or other defect in Equipment is expressly limited to the following, at Company's sole and absolute discretion:  (a) repair or replacement of the defective Equipment (or re-perform the service if limited to services), or (b) refund the amount paid for the defective Equipment (which may include a credit for any such unpaid balance owed to Company).   

8. Indemnification:  Company shall indemnify, defend and hold harmless Buyer from and against any liability, claim or cause of action incurred by Buyer as a result of any Equipment manufactured by Company and sold by Company (but only with respect to Company’s design and not for any custom features or designs requested by Buyer) infringing upon any United States patent, provided that Buyer shall have (a)  given Company prompt written notice of any such claim and (b) permitted Company to defend or settle such claim and shall have timely provided Company with all reasonable information, assistance, and authority necessary to enable Company to do so.

Buyer shall release, hold harmless, indemnify and defend Company from and against any liability, claim, suits, and costs caused by, arising from, or relating to (a) Buyer’s design or specifications of Equipment supplied hereunder if such Equipment is made in compliance with Buyer's design or specifications, (b) the conditions of Buyer's premises, including without limitation accidents or injuries occurring on such premises in connection with the delivery or installation of the Equipment, or (c) the breach by Buyer of its obligations hereunder. 

Claims for indemnification under this section shall be subject to the following: (a) the claimant must provide reasonable cooperation and assistance in the defense; and (b) the indemnifying party shall have sole and exclusive authority for the direction of the defense and the negotiation of any compromise or settlement; provided the claimant may monitor such matters through counsel of its choice at its own expense.  The provisions of this section shall survive termination of the Agreement. 

9. Force Majeure:  Company shall not be liable for any breach of the Company’s obligations under the Agreement that is primarily caused by any factor beyond Company’s reasonable control, including, but not limited to, unavailability or excessive cost of material, strikes, labor slowdowns, and stoppages, labor shortages, lockouts, fires, floods, earthquakes, storms, drought, adverse weather, riots, thefts, accidents, embargoes, war (whether or not declared) or other outbreaks of hostilities, civil strife, acts of governments, acts of God, acts of the public enemy, unusually severe weather, machinery breakdowns, delay or unavailability of carriers or supplies, governmental regulations, orders or injunctions, epidemics, pandemics, or other reasons, whether similar or dissimilar to any of the foregoing.  If direct costs to Company are increased as a result of a force majeure event, Company shall be entitled to a purchase price adjustment.

10. Insurance:  Upon delivery, Buyer shall be responsible for any and all loss to the Equipment and shall be responsible to insure the Equipment against risk of loss or damage by fire, including extended coverage, theft, and such other casualties.

11. Cost of Enforcement:  In the event of any arbitration, litigation or other proceeding to enforce the Agreement, the prevailing party in such proceeding shall be entitled to recovery and shall be reimbursed by the other party for all costs, expenses and charges incurred by the prevailing party in connection with such proceeding, including, without limitation, reasonable attorneys' fees and costs.

12. Cancellation and Amendment:  The Agreement may not be canceled or amended except by mutual written agreement of Company and Buyer.

13. Limitation of Liability:  The aggregate liability of Company arising out of or relating to the Agreement or the sale or use of the Equipment, including without limitation claims for indemnification, and whether based on contract, strict liability, negligence or other tort, pollution, disease or otherwise, shall not exceed an amount equal the amount received by Company under the Agreement.  In no event shall Company be liable for consequential, incidental, indirect, special, exemplary, or punitive damages of any kind, including without limitation for loss of profits, revenues or product, or loss of use of any property (whether by shutdown, operation at less than capacity or otherwise), regardless of whether any of the foregoing damages arising directly or indirectly through an indemnification or contribution obligation and whether arising out of breach of contract or warranty, tort, product liability, strict liability or any other legal theory.

14. Severability:  In case any provision of the Agreement is held to be invalid, illegal, or unenforceable, (a) such provision shall be limited or excluded, only to the extent necessary to make it valid, legal, and enforceable, and (b) the validity, legality, and enforceability of the remaining provisions shall not be affected.

15. General Provisions:  No provision of the Agreement may be waived except by a writing signed by the party making such waiver. No course of dealing or failure to strictly enforce any term shall be construed as a waiver.  Waiver of any term shall not constitute a waiver of any other terms or a continuing waiver.  The Agreement shall be binding on the parties and their respective successors and permitted assigns; provided that Buyer may not assign, delegate or permit any other transfer of this Agreement without Company's prior written consent.  The Agreement shall be governed by and construed in accordance with the laws of the State of Minnesota, without regard to its conflicts of law provisions, and the federal and state courts located in Minnesota shall have exclusive jurisdiction over any litigation regarding the Agreement.  The Agreement represents the entire agreement between the parties with respect to the subject matter and supersedes all previous oral and written negotiations, representations, and other communications.

4888-3057-7665, v. 2

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