Avalon Equipment Corporation Vendor Purchase Order Terms & Conditions

These terms apply to all Purchase Orders issued by Avalon Equipment Corporation to its vendors and suppliers.

1. Acceptance of Purchase Order

These Vendor Purchase Order Terms and Conditions ("PO Terms") are incorporated into and form a part of every Purchase Order ("PO") issued by Avalon Equipment Corporation ("Avalon") to the vendor or supplier identified on the face of the PO ("Vendor"). By acknowledging receipt of a PO, beginning performance, or shipping goods or providing services under a PO, Vendor agrees to be bound by these PO Terms.

Avalon's PO constitutes the complete and exclusive statement of the agreement between Avalon and Vendor with respect to the goods or services described therein. Any terms contained in Vendor's acknowledgment, invoice, quote, or other document that are additional to or different from these PO Terms are hereby rejected and shall not be binding on Avalon unless expressly agreed to in a separate written instrument signed by an authorized Avalon representative.

2. PO Number Required on All Documents

Avalon's PO number must appear on all invoices, packing slips, shipping labels, and correspondence related to the applicable order. Invoices submitted without a valid Avalon PO number may be returned or delayed without liability to Avalon. Vendor is responsible for obtaining a valid PO number prior to shipping any goods or commencing any services.

3. Vendor Acknowledgment

Vendor shall acknowledge receipt and acceptance of each PO in writing — by email, vendor portal confirmation, or signed acknowledgment — within two (2) business days of receipt. If Vendor is unable to fulfill the PO as issued (in whole or in part), Vendor must notify Avalon promptly so that Avalon may seek alternative sourcing. Commencement of work or shipment of goods without written acknowledgment is permitted but constitutes acceptance of all PO Terms.

4. Price, Taxes & Changes

4.1 Fixed Price

The price stated on the PO is fixed and may not be increased without Avalon's prior written consent. Vendor shall not ship goods or perform services in excess of the quantities or specifications stated on the PO without written authorization from Avalon.

4.2 Taxes

Unless otherwise stated on the PO, all prices are exclusive of applicable sales, use, excise, or similar taxes, which shall be separately identified on Vendor's invoice. Avalon will provide valid exemption certificates where applicable. Vendor is responsible for all taxes on Vendor's own income and employment.

4.3 Changes

Avalon may, by written notice, make changes to a PO including quantity, specifications, delivery schedule, or ship-to location. If a change causes a material increase or decrease in the cost of performance, Vendor shall notify Avalon in writing within five (5) business days and the parties shall negotiate an equitable adjustment in good faith. Vendor shall not implement changes to specifications, materials, or processes that may affect the goods or services without Avalon's prior written approval.

4.4 Open and Blanket Purchase Orders

Avalon may issue open or blanket Purchase Orders (“blanket POs”) authorizing recurring or volume purchases of goods or services over a defined period. The following terms apply to all blanket POs and supplement the other provisions of these PO Terms.

(a) Releases. Goods or services under a blanket PO shall be ordered through individual written release orders (“Releases”) issued by Avalon’s authorized procurement contact. Each Release shall specify the item, quantity, required delivery date, and ship-to location. Vendor shall not ship goods or commence services under a blanket PO without a corresponding Release. Vendor shall acknowledge each Release in writing within two (2) business days of receipt. Unless otherwise stated in the Release, Vendor shall fulfill each Release within the lead time agreed at the time the blanket PO is established, or if no lead time is specified, within a commercially reasonable time.

(b) Pricing. Pricing stated on the face of a blanket PO is fixed for the duration of the blanket PO term unless both parties agree in writing to a price adjustment. Vendor may request a price review no more than once per twelve (12) month period by providing Avalon with sixty (60) days’ written notice and documented cost justification. Any approved adjustment applies only to Releases issued after the effective date of the adjustment and does not affect Releases already acknowledged.

(c) Quantities. Unless the face of the blanket PO expressly states a firm minimum purchase commitment, Avalon makes no guarantee as to the total quantity that will be ordered during the blanket PO period. Any quantities shown on the blanket PO represent Avalon’s good-faith estimate only. Avalon shall not be obligated to issue Releases up to the full-face value of a blanket PO. Vendor shall not manufacture, stage, or procure inventory in excess of a confirmed Release without Avalon’s prior written authorization.

(d) Expiration. A blanket PO expires on the end date stated on its face, unless no end date is stated and agreed to in writing by Avalon and vendor. Any unfulfilled balance remaining at expiration is automatically cancelled without liability to either party, unless the parties agree in writing to extend the blanket PO prior to its expiration date. Avalon has no obligation to issue a Release for any remaining balance solely because a blanket PO is approaching expiration.

(e) Cancellation of Remaining Balance. Avalon may cancel the unfulfilled balance of a blanket PO at any time upon thirty (30) days’ written notice to Vendor. Avalon’s liability upon such cancellation is limited to payment for goods already shipped and accepted, and services already completed and accepted, under confirmed Releases prior to the cancellation effective date. Avalon shall not be liable for the cost of inventory staged by Vendor in anticipation of future Releases unless Avalon has expressly authorized such staging in writing.

(f) Three-Way Match on Releases. Each Release shall be treated as an independent transaction for purposes of invoicing and three-way match under Section 7.2. Vendor shall invoice each Release separately, referencing both the blanket PO number and the applicable Release number. Avalon’s three-way match will be performed at the Release level, not against the aggregate blanket PO value.

5. Delivery, Shipment & Title

5.1 Delivery Schedule

Time is of the essence with respect to all delivery dates stated on the PO. If Vendor anticipates any delay, Vendor must notify Avalon immediately with the reason for the delay and the expected revised delivery date. If delivery is not made by the required date, Avalon will provide Vendor written notice of the delay and a reasonable cure period of not less than five (5) business days, unless the delay causes Avalon material operational harm, in which case Avalon may act sooner with notice. If Vendor fails to deliver within the cure period, Avalon reserves the right to cancel or reduce the PO quantity and to source substitute goods or services. Any incremental cost of substitute sourcing above the original PO price shall be recoverable from Vendor, provided Avalon has made reasonable efforts to mitigate such costs.

5.2 Shipment

Unless otherwise specified on the PO, all goods shall be shipped F.O.B. Avalon's designated receiving location. Vendor shall follow Avalon's packaging and shipping instructions. All shipments must include a packing slip referencing Avalon's PO number and itemizing the contents. Risk of loss passes to Avalon upon delivery and acceptance at the designated location.

5.3 Title

Title to goods passes to Avalon upon delivery and acceptance at Avalon's designated receiving location, free and clear of all liens, encumbrances, and third-party claims.

6. Inspection, Acceptance & Rejection

All goods and services are subject to Avalon’s inspection and approval within ten (10) business days after delivery or completion (“Inspection Period”). Avalon may reject goods or services that do not conform to the specifications, drawings, samples, or other requirements stated in the PO. Avalon will provide written notice of rejection, including a description of the non-conformance, within the Inspection Period. Goods or services not rejected within the Inspection Period will be deemed accepted, provided that acceptance does not waive Avalon’s rights with respect to latent defects that could not reasonably have been discovered during inspection. Rejected goods will be returned to Vendor at Vendor’s expense, and Vendor shall promptly replace or correct them within a mutually agreed timeframe at no additional cost to Avalon. Payment of an invoice does not constitute final acceptance of goods or services with respect to latent or hidden defects.

7. Invoicing & Payment Terms

7.1 Invoice Requirements

Vendor shall submit invoices only after delivery and acceptance of conforming goods or services. Each invoice must include:

• Avalon's PO number
• Vendor's name, address, and remittance information
• Itemized description of goods or services, quantities, and unit prices
• Serial numbers when applicable
• Applicable taxes and fees separately identified
• Invoice date and invoice number

Invoices that do not meet these requirements may be returned for correction, and Avalon's payment obligation will not arise until a compliant invoice is received.

7.2 Payment Terms

Payment is due Net 30 days from the date Avalon receives a correct and complete invoice, unless different terms are expressly stated on the PO. Avalon’s payment of an invoice is subject to Avalon’s right to set off or withhold amounts for disputed items, claims for defective goods, short shipments, or other amounts owed by Vendor to Avalon. Avalon’s obligation to pay is contingent on Vendor’s compliance with all PO Terms. Payment is further contingent on Avalon’s completion of a three-way match confirming that the Vendor’s invoice, Avalon’s Purchase Order, and Avalon’s receiving documentation are in agreement as to item description, quantity, and price. Avalon will use commercially reasonable efforts to complete the three-way match within five (5) business days of receiving a compliant invoice. Invoices that fail the three-way match will be placed on hold and Vendor will be notified of the specific discrepancy within that same period. The Net 30 payment period does not begin until a corrected, compliant invoice is received and the three-way match is successfully completed.

7.3 Customer Proforma Invoices

Vendor-issued proforma invoices are acknowledged by Avalon for informational or customs and logistics purposes only. A proforma invoice does not constitute a binding claim for payment and does not alter, supersede, or accelerate Avalon's payment obligations under these PO Terms. All payment obligations are governed exclusively by the accepted PO and these PO Terms.

8. Vendor Warranties

Vendor represents and warrants that all goods and services delivered under a PO will:

• Conform to all specifications, drawings, and requirements stated in the PO
• Be new, free from defects in materials and workmanship, and fit for their intended purpose
• Be free and clear of all liens, encumbrances, and third-party claims
• Comply with all applicable federal, state, and local laws, regulations, and industry standards, including without limitation those relating to safety, labeling, and environmental compliance
• Not infringe any third-party intellectual property rights

These warranties are in addition to any warranties implied by law or provided by Vendor elsewhere and shall survive delivery, inspection, acceptance, and payment. Avalon's remedies for breach of warranty include repair, replacement, refund, or credit at Avalon's election.

9. Indemnification

Vendor shall defend, indemnify, and hold harmless Avalon and its officers, directors, employees, and agents from and against any third-party claims, damages, losses, costs, and expenses (including reasonable attorneys’ fees) arising out of or relating to: (a) Vendor’s breach of any representation, warranty, or obligation under these PO Terms; (b) any defect in goods or services supplied by Vendor; (c) any infringement of third-party intellectual property rights by Vendor’s goods or services; or (d) the negligent or wrongful acts or omissions of Vendor or Vendor’s personnel in connection with the PO. Vendor’s indemnification obligation shall be proportionate to Vendor’s degree of fault and shall not apply to the extent that any claim arises from Avalon’s own negligence, willful misconduct, or breach of these PO Terms.

10. Confidentiality

Vendor shall keep confidential all non-public information received from Avalon in connection with a PO, including pricing, specifications, product plans, and customer information, and shall use such information solely for the purpose of fulfilling the applicable PO. This obligation survives termination or completion of any PO for a period of three (3) years, or indefinitely with respect to trade secrets.

11. Legal & Regulatory Compliance

Vendor shall comply with all applicable laws and regulations in connection with the manufacture, sale, and delivery of goods and services, including without limitation: applicable labor and employment laws; anti-corruption and anti-bribery laws (including the U.S. Foreign Corrupt Practices Act); export control laws and regulations; and applicable environmental, health, and safety laws. Vendor represents that goods supplied do not contain conflict minerals sourced in a manner that directly or indirectly finances armed conflict in violation of applicable law.

12. Termination & Cancellation

Avalon may cancel all or any part of a PO for convenience upon written notice to Vendor. In such event, Avalon’s liability is limited to payment for conforming goods shipped and conforming services completed prior to the cancellation notice, less any amounts saved or recoverable by Vendor. Avalon may also cancel for cause immediately upon written notice if Vendor is in material breach of these PO Terms, becomes insolvent, or makes an assignment for the benefit of creditors.

If rejected or non-conforming goods exceed two percent (2%) of the total units inspected under that PO, Avalon will notify Vendor in writing and Vendor shall have ten (10) business days to provide a corrective action plan and begin remediation. If Vendor fails to present an acceptable corrective action plan within that period, or if the defect rate is systemic or recurring, Avalon may cancel the affected portion of the PO without liability. Upon any cancellation, Vendor shall immediately stop work on the cancelled portion and direct any subcontractors to do the same. Any claim by Vendor for reimbursement of reasonable and necessary expenditures incurred prior to cancellation must be submitted in writing within thirty (30) days of receipt of the cancellation notice. Avalon shall not be responsible for Vendor’s lost profits on any cancelled portion.

13. Limitation of Liability

TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, EACH PARTY’S AGGREGATE LIABILITY TO THE OTHER ARISING OUT OF OR RELATED TO ANY PO, WHETHER IN TORT, CONTRACT, OR OTHERWISE, SHALL NOT EXCEED THE TOTAL AMOUNT ACTUALLY PAID OR PAYABLE BY AVALON TO VENDOR UNDER THE APPLICABLE PO. IN NO EVENT SHALL EITHER PARTY OR ITS AFFILIATES BE LIABLE FOR ANY LOST REVENUES, LOST PROFITS, OR ANY INCIDENTAL, INDIRECT, CONSEQUENTIAL, SPECIAL, OR PUNITIVE DAMAGES, EVEN IF ADVISED OF THE POSSIBILITY THEREOF. THIS LIMITATION APPLIES REGARDLESS OF THE FORM OF ACTION AND WHETHER SUCH LIABILITY IS BASED ON CONTRACT, TORT, STRICT LIABILITY, OR ANY OTHER LEGAL THEORY. NOTWITHSTANDING THE FOREGOING, THIS LIMITATION SHALL NOT APPLY TO:

• A party’s indemnification obligations for third-party claims
• Breaches of confidentiality
• Fraud or willful misconduct
• Vendor’s intellectual property infringement obligations

14. No Security Interest or Lien

Vendor agrees that no purchase-money security interest, title retention, or other lien or encumbrance shall exist or be claimed by Vendor in any goods purchased by Avalon under a PO. Vendor shall not file or cause to be filed any UCC financing statement, lien, or security filing against any equipment or goods funded by a PO, provided that Avalon has paid for such goods or services in accordance with these PO Terms. In the event any such lien or security filing is made, Vendor shall immediately cause it to be released and shall indemnify and hold Avalon harmless from all costs, damages, and attorneys’ fees incurred in connection therewith.

15. Subcontracting

Vendor shall not subcontract any material portion of its obligations under a PO — meaning any subcontract that delegates a substantial part of Vendor’s core performance responsibilities — without Avalon’s prior written approval. Routine use of suppliers, component manufacturers, freight carriers, and similar ancillary service providers does not require prior approval but remains subject to Vendor’s obligations under these PO Terms. Approval of a subcontractor does not relieve Vendor of any responsibility for performance or for the quality of goods and services delivered. Vendor remains fully responsible for all acts and omissions of its subcontractors to the same extent as if performed by Vendor directly.

16. Labor Disputes

Whenever Vendor has knowledge that any actual or potential labor dispute is delaying or threatens to delay timely performance under a PO, Vendor shall immediately notify Avalon in writing, providing all relevant information including the nature of the dispute, the affected operations, and Vendor’s plan to mitigate the impact. Notice shall be provided to Avalon’s designated procurement contact. Failure to provide timely notice shall not excuse delayed performance but may be considered in any claim for equitable adjustment.

17. Use of Avalon Name & Public Disclosure

Vendor shall not, without Avalon’s prior written consent, make any public release of information concerning a PO or the business relationship between the parties, nor use Avalon’s name, logo, trademarks, or other identifying marks in any advertising, marketing, press release, case study, social media, or other public communication. This restriction applies to Vendor’s employees, agents, and subcontractors. Any approved use must be consistent with Avalon’s brand guidelines as communicated by Avalon from time to time.

18. Governing Law & Dispute Resolution

These PO Terms and all POs issued hereunder are governed by the laws of the State of California, without regard to its conflict-of-laws principles. The parties consent to the exclusive jurisdiction of the state and federal courts located in San Diego County, California for resolution of any disputes. The United Nations Convention on Contracts for the International Sale of Goods does not apply.

19. General Provisions

19.1 Entire Agreement

These PO Terms, together with the face of the applicable PO, constitute the entire agreement between Avalon and Vendor with respect to the subject matter of the PO and supersede all prior or contemporaneous agreements, representations, or understandings. No modification is binding unless in a writing signed by an authorized representative of both parties.

19.2 Assignment

Vendor may not assign any PO or subcontract any material portion of Vendor’s obligations without Avalon’s prior written consent. Any unauthorized assignment is void.

19.3 Waiver & Severability

Neither party’s failure to enforce any provision of these PO Terms shall constitute a waiver of that provision or of any other right or remedy. If any provision is found invalid or unenforceable, it shall be modified to the minimum extent necessary to make it enforceable, and the remaining provisions shall remain in full force.

19.4 Force Majeure

Neither party shall be liable for failure to perform due to causes beyond its reasonable control, provided that the affected party gives prompt written notice and uses commercially reasonable efforts to mitigate the impact. Financial hardship is not a force majeure event.

Issued by:

Avalon Equipment Corporation | 3194 Lionshead Ave, Carlsbad, CA 92010

purchasing@avalontest.com | (760) 536-0191