1.       PURPOSE AND SCOPE OF APPLICATION:

1.1    These Terms of Use (hereinafter "T&C") shall govern the contractual relationship between Industrial de Válvulas, S.A. de C.V. (hereinafter "WALWORTH") and its customers (hereinafter "CUSTOMER"), derived from the sales of equipment, parts and services for the integration of streamwide solutions in the Oil & Gas, power generation, chemical, mining, pulp and paper, cryogenic, geothermal, drinking water, drainage, wastewater treatment sectors, among others, made to "CUSTOMER" by means of orders or purchase orders (hereinafter "Order") generated by "WALWORTH" and accepted by "WALWORTH".

1.2    All commercial transactions generated between "WALWORTH" and "THE CUSTOMER" shall be governed by these T&C, which may be supplemented with additional or particular clauses in the event that a contract for the sale of goods or provision of services is required and appropriate to each particular case. Such additional or particular conditions shall prevail over the T&C whenever "WALWORTH" has expressly accepted them in writing.

1.3    When "THE CUSTOMER" requests an order of Products to "WALWORTH", he/she will be expressing his/her acceptance without any reservation of the T&C, since they will be accompanied by the corresponding quotation from "WALWORTH".

1.4    These T&C or, if applicable, the contract signed between "WALWORTH" and "THE CUSTOMER", supersede and prevail over any agreement or condition that the parties have agreed orally or in writing, either in person, by telephone, on paper or by e-mail or any other means, prior to the signing and acceptance of the corresponding order or contract.

2.       ORDERS:

2.1    The CUSTOMER shall forward to "WALWORTH" the order(s) for the products in writing, which may be by e-mail, specifying the model, quantity and delivery date requested.

2.2    The order must be accepted by "WALWORTH", establishing an estimated delivery date for the agreement of sale of the products to be understood as completed and binding.

2.3    In the event that an additional order is received after the deadline established in the previous point, "WALWORTH" reserves the right to update the quotation.

2.4  Once an order has been accepted by "WALWORTH", "THE CUSTOMER" may not make total or partial cancellations of said order unless it reaches an agreement with "WALWORTH" in accordance with the conditions of total or partial cancellation, observing the provisions of point 12 of these T&Cs.

2.5   "WALWORTH" is under no obligation to accept any order and, therefore, reserves the right to reject it, without any liability whatsoever arising therefrom.

2.6    “WALWORTH" shall start the manufacturing schedule at the plant upon confirmation of the order to "THE CUSTOMER"; only in case drawings have been requested, these must be approved by the parties prior the manufacturing of the product.

3.       ADVANCE PAYMENTS:

3.1    In the event that the parties agree to the payment of advance payments, the agreed payment percentage shall be paid by "THE CUSTOMER" at the time of order confirmation by "WALWORTH", as well as any other payment milestones deemed necessary for the particular case.

Manufacturing may not commence until the corresponding advance payment has been made and the delivery time shall be delayed as long as the advance payment or the second milestone payment is delayed, without detriment to "WALWORTH".

4.       DELIVERIES:

4.1  Shipments and deliveries shall always be subject to the approval of the Credit Department of "WALWORTH". If "THE CUSTOMER" is in arrears in the payments agreed in the contract or orders, "WALWORTH" may additionally and without limitation to its other rights and prerogatives, cancel all or some of the incomplete contracts or may defer deliveries or shipments that are assigned to such contracts until "THE CUSTOMER" becomes current in the outstanding payments.

4.2    The delivery term of the orders shall be understood as an estimate and in no case of compulsory compliance. Therefore, "WALWORTH" shall not be liable to "THE CUSTOMER" for any delay in the delivery of the products. "WALWORTH" shall not be liable directly or indirectly for consequential damages or losses caused by delays in delivery, regardless of the nature of the delay.

4.3  While not limiting the generality of the foregoing, "WALWORTH" assumes no liability for delays in delivery resulting from force majeure such as fire, flood, weather, accidents, riots, strikes, delays during transportation, shortage of materials or labor, present or future laws, acts of any governmental authority, or any other cause beyond the control of "WALWORTH". Products offered from stock are available except upon prior sale.

4.4  In any case, "WALWORTH" will endeavor to meet and supply orders within the deadlines agreed with "THE CUSTOMER", provided that its resources and production capabilities allow it. Likewise, "WALWORTH" may carry out partial deliveries of the order, with each partial delivery accruing the corresponding obligation of payment to be paid by "THE CUSTOMER".

4.5  “"WALWORTH" shall, as a general rule, deliver the Products "Ex Works" (EXW) at the door of its warehouse or factory, without freight paid and agreed with the Customer in the purchase contract or order. For the above, "THE CUSTOMER" must send by email to "WALWORTH" prior to the collection of the order: name of the driver who will pick up the order, license plates, registration card, insurance policy and description of the vehicle in which the load will be carried out. The driver or individual designated by "THE CUSTOMER" must provide "WALWORTH" warehouse personnel with a copy of his official identification and sign the document called "Check List" where all the operation data is referenced in order to proceed with the delivery. Any variation to the aforementioned shall be stipulated in the sales contract or order, in accordance with Incoterms® 2020.

4.6  In the case of deliveries in accordance with point 5. SHIPPING, "WALWORTH" will send the order to the delivery address established in the contract or order; any modification to the delivery address will cause an additional charge.

4.7  In the case of international shipments (exports) the evidence of delivery at all times will be the BL (Bill of Lading) in the case of maritime shipments and the AWB (Air Will Bill) in the case of air shipments; both documents issued by the shipping companies, airlines and their agents, in which it is stated that "THE CUSTOMER" has received the goods in full to be transported under the conditions agreed between "WALWORTH" and "THE CUSTOMER".

4.8  8 If for any reason "THE CUSTOMER" wishes to delay the shipment(s) for more than 30 (thirty) days after the completion of the manufacture of the products, or decides to put on hold or if it decides to stop the manufacturing process at any stage of the same, "WALWORTH" reserves the right to consider the order cancelled and claim the cancellation charges, in accordance with the provisions of point 12 CANCELLATIONS of these T&Cs.

4.9  After 30 (thirty) days have elapsed from the date of delivery of the order without "THE CUSTOMER" having picked it up from the place established in the order or purchase order, "WALWORTH" will apply a penalty of 1% per month of the value of the products pending pick up, as storage cost.

4.10 When the product has remained for more than 6 months in the warehouse of "WALWORTH" and "THE CUSTOMER" has not withdrawn it for causes attributable to the same, the product will be delivered in "As Is" conditions; if "THE CUSTOMER" wishes to have the products tested and detailed again, the services will be quoted separately.

5.       SHIPPING:

5.1   When so agreed by the parties, "WALWORTH" will attempt to carry out shipments by the route that results in the lowest cost, unless "CUSTOMER" indicates different instructions. All shipments shall be freight collect unless otherwise stipulated in the contract or order, in which case "WALWORTH" shall invoice "CUSTOMER" for transportation costs.

5.2   When the delivery of the order is carried out through an independent carrier or parcel service assigned by "THE CUSTOMER", "WALWORTH" will notify and send the tracking number by e-mail to "THE CUSTOMER", who, by signing these T&Cs, accepts that the order is complete and will be considered as a formal delivery. In this mode of delivery, the products will be the responsibility of "THE CUSTOMER" from the moment of delivery to the independent carrier. Any claim for loss or damage of the products during transit must be processed directly by "THE CUSTOMER" with the independent carrier. If "THE CUSTOMER" so considers, it may send a representative to the facilities of "WALWORTH" to ensure the delivery of the order to the independent carrier.

6.           CONFORMITY AND CLAIMS

6.1        THE CUSTOMER'S" conformity, regarding the totality of the delivery of the products of an order, shall be effected in the following manner:

When the delivery is carried out Ex Works, by means of the signature of the representative of "THE CUSTOMER" in the document called "Check List" established in point 4.5.

6.1.2    In the case of deliveries through an independent carrier, by means of written acceptance of this means of delivery, either in the order or by e-mail.

6.1.3    When Delivery Duty Paid (DDP) delivery is agreed upon, at the facilities of "THE CUSTOMER", by means of the signature and seal of the "Check List" document by the personnel designated by "THE CUSTOMER".

For any of the three scenarios, if "THE CUSTOMER" at this time does not make any claim, it will be understood that the order was delivered completely, so "WALWORTH" will not assume any responsibility for missing products.

7.       INSPECTION:

7.1   Final inspection and acceptance of the products shall be made at the manufacturing plant, unless otherwise specified in the order, subject to acceptance by the parties. Prices do not include charges for special tests or inspections performed at the request of "CUSTOMER", unless they have been included in the order and agreed upon by "WALWORTH" and "CUSTOMER".

8.       PRICING:

8.1   Sale prices of the Products shall be those fixed in the quotations and tariffs of "WALWORTH", communicated to "THE CUSTOMER"; or in the particular conditions agreed between "WALWORTH" and "THE CUSTOMER". The corresponding taxes shall be added to such prices, in accordance with the provisions of federal and state laws or any other government regulation related to the products, which shall be lower than the prices of the purchase order.

8.2   These prices shall be deemed to include everything that "WALWORTH" must provide or carry out (packaging costs, shipping costs, customs duties, taxes, transport costs in force on the day of delivery, etc.) to deliver the Products in accordance with the T&Cs set out in point 4 DELIVERIES.

8.3   “WALWORTH" may change the selling prices of the products at any time. The increase in the selling price will not affect ongoing product orders, which have been previously accepted by "WALWORTH". In the event that "THE CUSTOMER" places an order for products with an incorrect price, "WALWORTH" will communicate the correct price as soon as possible and, where appropriate, its acceptance to process the order, provided that "THE CUSTOMER" expressly confirms it, with the correct price within the following 2 (two) days.

8.4  In the case of purchased components, such as motors, gear operators and others, prices are quoted based on the prices of "WALWORTH" suppliers at the time of the quotation, so that, if applicable, the selling price will be updated according to the price escalation policies of such suppliers.

9.       PAYMENTS:

9.1   “THE CUSTOMER" shall pay the price corresponding to each order, by bank transfer, direct debit receipts or irrevocable letter of credit, as agreed with "WALWORTH", within the term established in each order or contract, calculated in calendar days from the date of the invoice issued for such purpose by "WALWORTH", which shall coincide, in principle, with the date of delivery of the Products.

9.2   In the case of payments in Mexican pesos regarding a quotation presented in U.S. dollars, the exchange rate to be used shall be that of the day of payment upon sale, which allows the purchase of the same amount of dollars of the corresponding quotation.

9.3   In case of total or partial non-payment of the amount of any order at the due date, "WALWORTH" may dispose of the goods to make use of them without being prone to suffer penalties, because it may move the delivery date of the product, informing "THE CUSTOMER" of this new date.

9.4   “THE CUSTOMER" agrees that it will not make any deduction or offset against the amount of the order due to "WALWORTH".

9.5   The issuance of invoices derived from late payments, will have an additional charge for default interest of 1.5% (one point five percent) per month on outstanding payments.

10.       CREDIT:

10.1    In the event that "THE CUSTOMER" requests credit for its order or contract, it shall be subject to approval by "WALWORTH".

10.2    The terms for the granting of a credit to "THE CUSTOMER" by "WALWORTH" shall be agreed upon in each quotation.

10.3    "WALWORTH" reserves the right to set a credit limit for each customer and to make deliveries conditional on this limit and on the presentation of a sufficient guarantee of payment. In case of delay or incidence in payments, "WALWORTH" may proceed to the recovery of the unpaid products and/or to take the appropriate legal action. "WALWORTH" reserves the right to claim the costs and expenses incurred in this situation.

11.       RESPONSABILITY:

11.1   “THE CUSTOMER" is solely responsible for the choice of the product(s) object of the commercial transaction, as well as the use or function for which it is intended. Consequently, "WALWORTH" shall not be liable nor guarantee that the product is suitable for the technical applications intended by "THE CUSTOMER", nor to achieve, in whole or partially, the objectives foreseen by the latter when purchasing the products. In this regard, "THE CUSTOMER" shall observe the provisions of points 12 CANCELLATIONS and 13 RETURNS of these T&Cs.

11.2   Any technical advice given by "WALWORTH" verbally, in writing or by means of tests, before and/or during the use of the Product, shall be given in good faith, but with no guarantee. Any advice from "WALWORTH" does not relieve "THE CUSTOMER" of its obligation to test the Product sold to determine its suitability for the processes and uses for which it is intended.

11.3   All liability on the part of "WALWORTH" for damages caused by defects in the Products is excluded, except where it is expressly required to do so by applicable law and under "WALWORTH's" liability policy. Similarly, "WALWORTH" shall not be liable for incidental, indirect or consequential losses or damages, loss of profits, loss of production or profits, risks of development of the Products.

11.4   In the event that "WALWORTH" shall be liable for damages suffered by "THE CUSTOMER", such liability shall be limited to an amount equal to the amount corresponding to the order of the product causing the damage, unless an applicable law imposes on "WALWORTH" a higher quantitative limit.

12.       CANCELLATIONS:

12.1  Once the order has been accepted by "WALWORTH", the items or orders to be cancelled by "THE CUSTOMER" shall be subject to cancellation charges in accordance with the following:
a.          5% (five percent) of the sale price for stock products, if the cancellation is made within the first 5 business days after the order has been accepted.
b.          10% (ten percent) of the sale price for stock products, if the cancellation is made after 5 business days after the order has been accepted.
c.          10% (ten percent) of the sales price prior to drawing approval for products manufactured specifically for that purchase order.
d.          15% (fifteen percent) of the sales price after issuance of drawings for approval, but prior to commencement of manufacture of raw materials.
e.          50% (fifty percent) of the sales price during the raw material manufacturing stages.
f.           75% (seventy-five percent) of the sales price during the machining and welding processes.
g.          100% (one hundred percent) after assembly and testing.

13.       RETURNS:

13.1   Should "THE CUSTOMER" require to return any product as it is in its best interest during the following 30 days after delivery, it must obtain written authorization from "WALWORTH", as well as an instruction card for product returns. A minimum charge of 25% (twenty-five percent) of the invoice value plus the cost of freight for both the original shipment and the return shipment of the products, as well as the cost of reconditioning the products for future sale, will be applied.

14.       WARRANTY:

14.1   "WALWORTH", extends the following warranty for its products for a period of 12 (twelve) months in operation or 18 (eighteen) months in storage whichever occurs first from the date of delivery of the product.

14.2   “WALWORTH" warrants that its products are manufactured under quality, design and manufacturing standards and contractual regulations requested by "THE CUSTOMER". In the event that the purchaser expressly confirms in writing the non-compliance with such standards, "WALWORTH" undertakes to repair or replace or issue written authorization for the customer or others to replace or repair at no cost to the purchaser at "WALWORTH's" manufacturing costs, such parts proven to be defective.

14.3   This Warranty shall be valid when the choice of materials made by "THE CUSTOMER" for the design, arrangement of materials (valve internals, end bodies, actuating mechanisms, etc.), internal and/or external coatings, have been adequate for handling the fluid in operation.

14.4    This Warranty shall apply when the operating and service conditions for which the product was requested are maintained.

14.5   To validate the Warranty, the user is responsible for performing the correct maintenance in due time and form to the products and in accordance with the provisions of the corresponding operation and maintenance manual. "WALWORTH reserves the right to request the records (evidence) that comprise the maintenance agreement.

14.6    The obligations of "WALWORTH" are limited and shall not be liable in the event that the products are altered, repaired or replaced without the express written consent of "WALWORTH".

14.7   warranties for any loss, direct, indirect, incidental or consequential damage to other products, processes, facilities or equipment of the purchaser or end user, whether partial or total due to defects in materials and/or workmanship and/or the design of the "WALWORTH" product.

15.       DESIGNS:

15.1   Unless otherwise expressly stated, the company's specifications concerning the products are subject to change by "WALWORTH" during their manufacture without prior notice to "CUSTOMER". It is the company's policy to constantly strive to improve its products. Therefore, "WALWORTH" reserves the right to make design and other changes whenever "WALWORTH" believes that its equipment will improve, but with no obligation to incorporate such changes retroactively.

16.       CHANGES:

16.1   “WALWORTH shall apply a charge for untimely modifications to an order after it has been submitted to its system, and when such change or modification will result in additional engineering or clerical work for both WALWORTH and its suppliers.

17.       EXECUTION:

17.1  Any modification to an order shall be binding on "WALWORTH" when approved in writing by a legal representative. Once approved through contract, amendment agreement, addendum or applicable instrument, such document shall supersede all previous communications, whether oral or written.

18.       MINIMUM PURCHASE AMOUNTS:

Orders under USD $ 5, 000.00 (five thousand U.S. dollars 00/100) will not be accepted except for inventory or where Walworth sends written confirmation of the order. This clause does not apply to spare parts or services.

NOTE: "WALWORTH" reserves the right to correct blatant clerical errors in quotations, invoices, as well as in other contracts.