Common use of Authorization for Returns Clause in Contracts

Authorization for Returns. Product returns from third parties will be authorized by Company in accordance with Company’s written procedures. Company may perform the initial failure analysis on returned Product. Those units indicating a defect due to assembly processing (Defective Unit) will be shipped to Contractor for confirmation or performance of failure analysis at Contractor’s expense. Contractor is responsible for defining and implementation of containment actions, if any, and corrective actions to prevent future occurrences of the defect at his sole expense. Company shall approve of containment and corrective actions prior to implementation by Contactor. Contractor’s liability as a result of any such defect shall be to provide a well performing and reliable replacement Unit for each Defective Unit or compensation to Company for the amount charged to Company for each Defective Unit.