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BELL MICROPRODUCTS INC. STANDARD TERMS AND CONDITIONS OF SALE

The following terms and conditions (“Agreement”) shall govern the sale of products and services (“Products”) by Bell Microproducts Inc. and all its affiliates and subsidiaries (“Bell Micro”), and shall apply to all quotations and offers made and purchase orders accepted by Bell Micro.  Bell Micro’s acceptance of Buyer’s order is conditioned upon Buyer’s acceptance of this Agreement.  By purchasing Products, Buyer agrees to be bound by and accepts this Agreement.  All other terms and conditions, including preprinted terms and conditions contained on any order form or correspondence originated by Buyer (such as purchase orders or confirmations) are null and void and without effect notwithstanding acceptance of the order by Bell Micro.  In the event that any part of the purchase and sale of Products utilizes electronic data interchange, internal or third party portal, or any other electronic means, this Agreement will continue to apply to the purchase and sale of Products.  Bell Micro’s failure to object to provisions contained in any communication from Buyer shall not be deemed a waiver of the provisions herein.

1.  Orders.  All orders for Products are subject to acceptance by Bell Micro.  Orders shall be initiated by Buyer through the issuance of purchase orders in hard copy or electronic form, including electronic data interchange.  Only the transaction specific terms of an order shall apply.  Each order shall specify the Products being ordered, quantities, prices, part numbers, descriptions, requested delivery dates and such other information as may be necessary for Bell Micro to fulfill the order.  Once accepted, an order cannot be cancelled, modified or rescheduled for shipment.

2.  Prices.  Prices shall be Bell Micro’s published prices for Products or as otherwise quoted by Bell Micro to Buyer.  Unless otherwise specified prices quoted are good for thirty (30) days.  Quantity discounts are quoted for Product type ordered for immediate delivery at one time.  Bell Micro may increase prices if its costs increase or due to other circumstances beyond Bell Micro’s reasonable control.

3.  Taxes.  All prices are quoted exclusive of any federal, state, sales, use, excise, value added or similar taxes imposed by any governmental authority regardless of how denominated.  Such taxes and any international shipping charges, broker’s fees, consular fees and customs duties shall be the responsibility of Buyer.  Buyer shall pay all such taxes (other than taxes based on the net income of Bell Micro) or charges or provide Bell Micro with a tax or levy exemption certificate acceptable to the taxing or levying authority.  In the event Bell Micro is required to pay any taxes or other charges for which Buyer is responsible hereunder, Buyer shall promptly pay the same to Bell Micro upon receipt of Bell Micro’s invoice therefor.

4.  Payment Terms.  Payments shall be due thirty (30) days from the date of invoice without offset or deduction.  Without limiting other remedies, Buyer shall pay a late payment charge of 1½% per month, but not in excess of the lawful maximum, on any past due balance.  Bell Micro reserves the right to cancel or suspend delivery of all or part of an order if Buyer is delinquent in any payments owing to Bell Micro.  Buyer shall remain liable for any partial deliveries already made as well as for payment of any orders that are non-cancelable or nonreturnable.  Buyer agrees to provide such financial information as Bell Micro may require for the extension of credit terms.  Bell Micro shall retain a purchase money security interest in any products delivered pursuant to an order until it has received payment in full.  Buyer agrees to execute any financing statements or similar documents as may be reasonably required for Bell Micro to perfect such security interest.

5.  Delivery.  All goods shall be delivered to Buyer ex works (Incoterms 2000).  Shipping dates are approximate.  Bell Micro shall use reasonable efforts to meet Buyer’s requested delivery dates but in no event shall Bell Micro be liable for any loss, damage, costs, expenses or penalties for any failure to meet such delivery dates, nor shall any delay in the delivery of one or more installments give Buyer the right to cancel all or part of an order.  Bell Micro reserves the right to make deliveries in installments.  Any claim regarding shortages must be made within ten (10) days of arrival of the shipment at Buyer’s facility.

6.  Return of Product.  Products will only be accepted for return pursuant to a Return Material Authorization (“RMA”) issued by Bell Micro.  RMAs will not be granted for damage, shortage or other discrepancies created by Buyer, the carrier or freight provider, or any other third party.  Returned Products must be in their original shipping cartons complete with all packing materials and shall be returned to Bell Micro’s designated return location freight prepaid.  At Bell Micro’s discretion, Bell Micro will return all Products not eligible for return to Buyer, freight collect, or hold Product for Buyer’s account at Buyer’s expense.

7.  Warranty.  Bell Micro will transfer to Buyer any Product warranties and indemnities authorized by the manufacturer, including any transferable warranties and indemnities for intellectual property infringement.  No indemnities are given by Bell Micro against claims of intellectual property infringement.  Bell Micro warrants that, upon delivery, Products purchased by Buyer hereunder will conform to the applicable manufacturer’s specifications.  Value-added work performed by Bell Micro on Products will conform to the applicable statement of work for a period of one year from delivery of the Product.  The foregoing warranty shall not apply with respect to any Product or Product component that has been subjected to abuse, misuse, accident, alteration or neglect.  Except for these limited warranties, which are made solely to Buyer, BELL MICRO MAKES NO WARRANTIES TO BUYER OR ANY THIRD PARTY, EXPRESS OR IMPLIED, INCLUDING BUT NOT LIMITED TO THE IMPLIED WARRANTIES OF FITNESS FOR A PARTICULAR PURPOSE OR MERCHANTABILITY, OR ARISING FROM A COURSE OF DEALING, USAGE OR TRADE PRACTICE, OR NON-INFRINGEMENT.  Bell Micro’s warranty obligations with respect to Products are limited, at Bell Micro’s option, to repair or replace the Products, or to refund the purchase price paid by Buyer for the affected Products. 

8.  Reselling By Buyer.  If Buyer is reselling the Product, Buyer represents that it has acquired all authorizations and regulatory approvals that are applicable to the Product or that the manufacturer of the Product may have independently established as being necessary to be an authorized reseller of the Product.  Buyer shall be solely responsible for providing support to its resellers or customers.  Buyer agrees to indemnify and hold Bell Micro harmless from any claim asserted by a third party, regardless of the theory under which such claim is asserted, based on Bell Micro’s compliance with Buyer’s specifications, instructions or statement of work, or a breach of any warranty or representation made by Buyer with respect to the Products beyond those provided by Bell Micro or its suppliers.

9.  Intellectual Property Indemnity.  Buyer shall indemnify and hold Bell Micro harmless from any claim asserted by a third party, and pay all costs, settlements and judgments associated therewith, including reasonable attorney’s fees and fines, that the Products, when produced or delivered in conformity to the Product specifications, infringe a patent, copyright, trademark, trade secret or other intellectual property rights of a third party.  As a condition of Buyer’s obligations, Bell Micro will give Buyer full authority to defend and settle such claim, and will provide all reasonable assistance requested by Buyer.

10.  Limitation of Liability.  NEITHER PARTY SHALL BE LIABLE TO THE OTHER HEREUNDER FOR ANY INDIRECT, SPECIAL, INCIDENTAL, CONSEQUENTIAL OR PUNITIVE DAMAGES, INCLUDING, WITHOUT LIMITATION, LOSS OF PROFITS OR REVENUE, LOSS OF DATA, PROCUREMENT COSTS, OR BUSINESS INTERRUPTION COSTS, REGARDLESS OF THE FORM OF ACTION, WHETHER BASED IN CONTRACT OR IN TORT (INCLUDING NEGLIGENCE), STATUTE, WHETHER OR NOT FORESEEABLE, EVEN IF SUCH PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES AND NOTWITHSTANDING ANY FAILURE OF ESSENTIAL PURPOSE OF ANY EXCLUSIVE REMEDY PROVIDED IN THIS AGREEMENT.

BELL MICRO’S ENTIRE LIABILITY AND BUYER’S EXCLUSIVE REMEDY AGAINST BELL MICRO FOR ANY DAMAGES CAUSED BY ANY PRODUCT DEFECT OR FAILURE OR ARISING FROM THE PERFORMANCE OR NON-PERFORMANCE OF ANY WORK, REGARDLESS OF THE FORM OF ACTION, WHETHER IN CONTRACT, TORT (INCLUDING NEGLIGENCE), STRICT LIABILITY OR OTHERWISE SHALL BE: (1) FOR FAILURE TO DELIVER OR FOR DELAYS IN DELIVERY OF PRODUCT, BELL MICRO SHALL HAVE NO LIABILITY UNLESS THE DELIVERY IS DELAYED BY MORE THAN THIRTY (30) DAYS BY CAUSES NOT ATTRIBUTABLE EITHER TO BUYER OR TO CONDITIONS BEYOND BELL MICRO’S REASONABLE CONTROL IN WHICH CASE BUYER SHALL HAVE THE RIGHT, AS ITS SOLE REMEDY, TO TERMINATE THE ORDER; (2) FOR BODILY INJURY OR DEATH TO ANY PERSON PROXIMATELY CAUSED BY BELL MICRO, BUYER’S RIGHT TO PROVEN DIRECT DAMAGES; AND (3) FOR CLAIMS OTHER THAN SET FORTH HEREIN, BELL MICRO’S LIABILITY SHALL BE LIMITED TO DIRECT DAMAGES THAT ARE PROVEN, IN AN AMOUNT NOT TO EXCEED TEN PERCENT (10%) OF THE AGGREGATE CONSIDERATION PAID BY BUYER TO BELL MICRO FOR THE PRODUCTS GIVING RISE TO THE CLAIM.  MULTIPLE CLAIMS WILL NOT ENLARGE THIS LIMIT.  “CLAIM” AS USED HEREIN MEANS ONE OR MORE CLAIMS, ARISING OUT OF, OR IN CONNECTION WITH, THIS AGREEMENT OR ARISING OUT OF ANY ACT OR OMISSION BY BELL MICRO OR ITS SUPPLIERS OR CONTRACTORS OCCURRING IN CONNECTION WITH PERFORMANCE UNDER THIS AGREEMENT.  THIS LIMITATION OF LIABILITY SHALL APPLY WHETHER OR NOT SUCH CLAIM IS FORESEEABLE, EVEN IF BELL MICRO HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES AND NOTWITHSTANDING ANY FAILURE OF ESSENTIAL PURPOSE OF ANY EXCLUSIVE REMEDY PROVIDED IN THIS AGREEMENT.

11.  High Risk Use.  ALL PRODUCTS SOLD BY BELL MICRO HEREUNDER ARE MANUFACTURED SOLELY FOR STANDARD COMMERCIAL APPLICATIONS AND ARE NOT INTENDED FOR USE IN ANY CRITICAL SAFETY OR LIFE-SUPPORT SYSTEM, MEDICAL DEVICE, NUCLEAR FACILITY, MILITARY DEVICE, SATELLITE, AVIATION EQUIPMENT OR WHERE A FAILURE MAY REASONABLY BE EXPECTED TO RESULT IN PERSONAL INJURY, LOSS OF LIFE, OR CATASTROPHIC PROPERTY DAMAGE (“HIGH-RISK APPLICATIONS”).  BELL MICRO DISCLAIMS ANY AND ALL LIABILITY IN CONNECTION WITH USE OF THE PRODUCT FOR ANY HIGH-RISK APPLICATION.  BUYER WARRANTS THAT IT WILL NOT USE, OR KNOWINGLY PERMIT ANY OF ITS DIRECT OR INDIRECT CUSTOMERS TO USE ANY PRODUCT IN ANY HIGH-RISK APPLICATIONS. BUYER AGREES TO INDEMNIFY, DEFEND, AND HOLD BELL MICRO HARMLESS AGAINST ANY LOSS, LIABILITY, OR DAMAGE OF ANY KIND THAT BELL MICRO INCURS IN CONNECTION WITH A BREACH OF THIS WARRANTY.

12.  Licensed Material.  If any software or other licensed materials (“Licensed Materials”) are delivered to Buyer as part of an order, then the possession, use and further distribution of such Licensed Materials by Buyer are subject to the terms of the license agreements accompanying such Licensed Materials.  Unless Bell Micro and Buyer have executed a separate license agreement covering the Licensed Materials, Bell Micro is not the licensor of Licensed Materials and Buyer’s license rights to the Licensed Materials are between Buyer and Bell Micro’s suppliers or their licensors.  Nothing herein shall be construed as granting Buyer any rights to Licensed Materials inconsistent with the terms of any such license agreements.

13.  Product Information.  Product information, including information relating to a Product’s specifications, export/import control classifications, uses or conformance with legal or other requirements is obtained from Bell Micro from its suppliers or other sources.  Such information is provided by Bell Micro on an “AS IS” basis.  Bell Micro makes no representations to the accuracy or completeness of the Product information, and DISCLAIMS ALL PRODUCT INFORMATION, INCLUDING ANY IMPLIED WARRANTIES OF MERCHANTIBILITY, FITNESS FOR A PARTICULAR PURPOSE, TITLE AND NON-INFRINGEMENT.  Bell Micro recommends Buyer validate any Product information before using or acting on such information.  All Product information is subject to change without notice.  Bell Micro is not responsible for typographical or other errors or omissions in Product information.

14.  Export Control.  Buyer shall not export or re-export any Product or technical data except in full compliance with the export control laws and regulations of the United States government, its departments and agencies, or import or re-export any Product or technical data except in full compliance of the laws of the jurisdiction into which, or from which, such Product or technical data is being imported or re-exported.

15.  Force Majeure.  Except for the payment of monies due and owing, neither party shall be liable for any failure to perform hereunder where such failure is due to causes beyond its reasonable control, including, but not limited to, natural disasters and other acts of God, military or civil strife, labor disputes or unrest, declared acts of terrorism, acts of governments or an interruption in the means of transportation or material shortages.  In the case of material shortages, Bell Micro reserves the right to allocate the delivery of affected materials on a pro rata basis. The time for performance shall be extended by the period of the force majeure.

16.  No License.  Except as may be required for each party to carry out its responsibilities hereunder, nothing in this Agreement shall be deemed to constitute a license, by implication or estoppel, to either party’s present or future patents, trade secrets, trademarks, copyrights or other intellectual property rights.

17.  Compliance with Laws.  Each party agrees to comply with all laws and regulations applicable to its performance under this Agreement and in the conduct of its business operations and to be responsible for obtaining any approvals or licenses necessary to maintain such compliance.

18.  General Provisions
Relationship of the Parties.  The relationship of the parties hereto is that of independent contractors. Neither party, nor its agents or employees, shall be deemed to be the agent, employee, joint venture partner, partner or fiduciary of the other party.  Neither party shall have the right to bind the other party, transact any business on behalf of or in the name of the other party, or incur any liability for or on behalf of the other party.

Assignment.  Buyer shall not assign this Agreement or any order placed hereunder, by operation of law or otherwise, without Bell Micro’s prior written consent.  Subject to the foregoing, this Agreement will be binding upon, enforceable by, and inure to the benefit of the parties and their respective successors and assigns.  Any assignment attempted in violation of this provision shall be void and of no legal effect.

Governing Law and Venue.  This Agreement shall be governed and construed in accordance with the laws of the state of California as if made and performed entirely within the state of California, without reference to its conflicts of law provisions, and specifically excludes the United Nations Convention for the International Sale of Goods.  All disputes arising out of or related to this Agreement will be subject to the exclusive jurisdiction and venue of the California state courts of Santa Clara County, California or if in federal court, the United States District Court for the Northern District of California, and the parties consent to the personal and exclusive jurisdiction of these courts.

Waiver.  No failure or delay on the part of either party in the exercise of any right or privilege hereunder shall operate as a waiver thereof or of the exercise of any other right or privilege hereunder, nor shall any single or partial exercise of any such right or privilege preclude other or further exercise thereof or of any other right or privilege.

Severability.  If any term, condition or provision of this Agreement is found to be invalid, unlawful or unenforceable to any extent, the parties will endeavor in good faith to agree to such amendments that will preserve, as far as possible, the intentions expressed in this Agreement.  Such invalid term, condition or provision will be severed from the remaining terms, conditions, and provisions, which will continue to be valid and enforceable to the fullest extent permitted by law. 

Entire Agreement.  This Agreement constitutes and contains the complete agreement and understanding of the parties with respect to the subject matter hereof and supersede any and all prior correspondence, agreements, representations, statements, negotiations and undertakings between the parties relating to the subject matter hereof.  Amendments to this Agreement must be in writing and signed by duly authorized representatives of both parties.

Survival.  The obligations of the parties under this Agreement, which by their nature would continue beyond the termination, cancellation or expiration of this Agreement, shall survive any termination, cancellation or expiration of this Agreement.

Attorneys’ Fees and Costs.  In the event of any dispute, whether or not litigation is commenced, arising out of any transaction covered by this Agreement, the prevailing party shall pay to the non-prevailing party reasonable attorneys’ fees and court costs.