Common use of Nonconforming Equipment Clause in Contracts

Nonconforming Equipment. 6.1. Payment for Equipment delivered hereunder shall not constitute acceptance thereof. Buyer shall have the right to test the Equipment after installation at Buyer’s premises as well as during building of the Equipment, including milestone checks, at Seller’s facility. Buyer may reject the Equipment if it does not meet the specifications, technical standards, drawings, samples, or descriptions that have been furnished, specified or approved by Buyer (the “Specifications”) or any applicable warranty. In the event of a rejection of any Equipment or any component or subassembly of the Equipment, Seller shall have five (5) days to submit a plan to Buyer as to how Seller will make corrections or alterations to the Equipment or where applicable, the components or subassemblies. The plan shall include the time required for Seller to correct or alter the Equipment and the time period must be approved by the Buyer. After such rejection, Seller shall have a period (not to exceed five (5) working days or as agreed between Seller and Buyer), to make alterations at Seller’s expense necessary to cause the Equipment to comply with the Specifications and warranties. Seller may again then tender the Equipment to Buyer. Buyer shall again have the right to test the Equipment. If the Equipment does not meet the Specifications or any applicable warranty, Buyer may at its option (a) retain the nonconforming Equipment and either repair the Equipment itself or request Seller do so, on or off-site; as applicable, or (b) reject the Equipment and be relieved of liability for the purchase price and be entitled to a refund of any payments already made. In the event of rejection of the Equipment, Buyer shall at its option, and without any liability to Seller, store the Equipment until Seller arranges for the return shipment of the Equipment at its sole cost and risk, or arrange for the return of the Equipment to Seller, at Seller’s sole cost and risk. Any specific testing and rejection procedures contained in Buyer’s purchase order shall supersede the language of this Paragraph to the extent of any inconsistency.