SUPPLIER (the “Supplier”).
BUYER (the “Buyer”).



Section 1.1

In this agreement unless the context otherwise requires the following expressions have the following meanings:
“Dies” means any jig, fixture or tooling required for the manufacture of the Products
“Order” has the meaning set out in clause 4.2
“Parties” means the Buyer and the Supplier collectively
“Products” means the items described in Schedule A.
“Specifications” means the requirements that the Products must meet as described in Schedule B or as modified by written agreement from time to time.
“Incoterms 2000” means the official rules for the interpretation of trade terms published by the International Chamber of Commerce to enter into force on 1 January 2000.

Section 1.2

All reference to this document includes the Schedules.

Application of Agreement

Section 2.1

The provisions of this document and the content of any particular Order will govern the purchase by the Buyer and sale by the Supplier of all Products during the period of operation of this document.

Duration of Agreement

Section 3.1

This document will commence when it has been executed by both Parties.

Section 3.2

This document will continue for one year unless terminated earlier under the provisions in part 16.


Section 4.1

The Buyer may order Products from time to time from the Supplier.

Section 4.2

An Order will be in writing and will specify:
  • The Products;
  • The quantity of Products;
  • The delivery dates and required method and place of delivery; and
  • Any variation to the provisions of this Agreement;
required for that particular Order.

Section 4.3

The Supplier in its absolute discretion may:
  • Accept the Order;
  • Reject the Order; or
  • Specify the content of an alternative Order that it is prepared to accept.

Section 4.4

If the Supplier specifies the content of an alternative Order under clause 4.3.c above, it may specify variations to any matter referred to in the Order and may specify prices which are different to those previously advertised or quoted by it.

Section 4.5

A binding obligation of the Supplier to sell Products ordered and a binding obligation of the Buyer to purchase Products ordered will only be formed:
  • When the Supplier notifies to the Buyer of its acceptance of the content of an Order placed by the Buyer, or
  • If the Supplier has specified the content of an alternative Order under clause 4.3.c above, when the Buyer notifies the Supplier of its acceptance of that alternative Order, provided that acceptance must have been given within 3 days after the Supplier notified the Buyer of the terms of the alternative Order.


Section 5.1

The Supplier may provide a quotation to a Buyer before the Buyer places an Order.

Section 5.2

The contents of the quotation are provided as a guide only. The Supplier may vary the price payable in respect of Products at any time until a binding obligation to sell is formed under the terms of clause 4.5 above.

Section 5.3

The price payable by the Buyer for Products will be:
  • As specified in a quotation applicable to an Order unless the Supplier has notified the Buyer of a change to the price after the quotation is issued and before a binding obligation to sell is formed under the terms of clause 4.5 above in which case the price will be the last price notified to the Buyer by the Seller before the binding obligation to sell is formed); plus
  • Any goods and services tax levied in respect of supplies made under this document by operation of the Goods and Services Tax Act 1985 (New Zealand), and
  • Any other money payable by the Supplier to a financial or taxation authority or government of any country or state in respect of the sale, supply or delivery of the Products by the Supplier to the Buyer.


Section 6.1

The Supplier will invoice the Buyer for the purchase price for Products ordered at the time of delivery.

Section 6.2

The Buyer will pay the purchase price for Products ordered to the Supplier in full within thirty (30) days after the date of delivery, unless otherwise separately agreed in writing.

Section 6.3

All payments will be made by direct credit to the account specified on the invoice in the agreed currency; but transmission of payment into that account will not constitute payment and the Buyer remains liable for the full amount payable until the Supplier’s bank acknowledges to the Supplier that the payment has been cleared.

Section 6.4

The Buyer is not entitled to withhold payment, or make any deductions from the purchase price for Products, or set-off any amount owed by the Supplier to the Buyer whether by equitable setoff or otherwise, without the prior written consent of the Supplier.

Section 6.5

Interest at the rate of 12% per annum will be paid by the Buyer to the Supplier on all money owing by the Buyer to the Supplier for any reason from the date payment is due until all that money and interest payable under this clause is paid. The Buyer and the Supplier agree that the interest rate specified in this clause reasonably reflects by way of liquidated damages the cost to the Supplier of being held out of the sums owing to it by the Buyer in the circumstances of default. The operation of this clause is without prejudice to any other rights of the Supplier in respect of late payment or non-payment.

Section 6.6

Interest payable under clause 6.5 shall be calculated;
  • As accruing from day to day; and
  • May be compounded to and become part of the principal debt at the end of each month of default; and
  • May be claimed in the same manner both before and after any judgement.

Section 6.7

The Buyer is also liable to pay all actual expenses and legal costs of the Supplier in relation to taking any steps to enforce this agreement and obtaining payment if the Buyer breaches its payment obligations.


Section 7.1

The Supplier will deliver the Products ordered to the location specified in the relevant order on the basis of FOB Incoterms 2000 unless otherwise agreed in writing in respect of any particular Order.

Section 7.2

The provisions of Incoterms 2000 relating to an FOB contract shall apply to this contract unless the terms of this contract conflict with those provisions. In the case of conflict the provisions of this document will have priority.

Section 7.3

The Supplier will use reasonable endeavours to deliver the Products ordered by the time specified in a particular order but it does not warrant that the date will be met. The Supplier will not be liable for any loss or damage resulting either directly or indirectly from a failure to deliver by a specified date.

Section 7.4

The Supplier reserves the right to refuse to deliver Products to the Buyer if any payment due from the Buyer to the Supplier in respect of Products previously delivered remains outstanding but refusal to deliver if payment is outstanding in no way releases the Buyer’s obligations to the Supplier.

Section 7.5

The Buyer must pay to the Supplier any costs of storage, demurrage, transport or associated costs incurred by the Supplier arising directly or indirectly from any failure by the Buyer to take delivery of Products or to pay the price for the products when due. This clause is without prejudice to any other remedy that the Supplier may have against the Buyer.


Section 8.1

If Products are delivered on the basis of FOB, Incoterms 2000 risk in the Products will pass in accordance with that term.

Section 8.2

In all other cases, risk of loss of or damage in the Products will pass from the Supplier to the Buyer in the manner agreed when the Order is finalised.


Section 9.1

The legal and beneficial ownership in all Products delivered by the Supplier to the Buyer remains with the Supplier until all Products relating to the Order have been paid for.

Section 9.2

All Products must be stored in a manner which allows them to be separately identified until dealt with under the terms of this contract.

Section 9.3

The Buyer may sell Products to a customer in the ordinary course of business and in that case:
  • Ownership of those Products will vest in the customer, but
  • The proceeds of the sale of the goods sold by the Buyer will belong to the Supplier.

Section 9.4

At any time that the Buyer sells Product under clause 9.3, it does so as principal and not as agent of the Supplier.


Section 10.1

Products will conform to the Specifications.

Section 10.2

Products will be of merchantable quality.

Section 10.3

Products will be delivered free and clear of all liens, encumbrances, or claims of others.

Section 10.4

The Supplier makes no other representation or warranty about the Products or their suitability or fitness for any particular purpose or use. All other statutory warranties which may be implied (including under the Sale of Goods Act 1908, the Consumer Guarantees Act 1993 or any other consumer protection legislation) are expressly excluded to the extent allowed by the applicable law.

Section 10.5

The Buyer has made its own assessment of the suitability and fitness of the Products for each purpose and use (including any manufacturing process or alteration or mixing of the Product with other goods) to which the Buyer will put the Products. The Buyer has relied on its own skill and judgement in making that assessment.

Section 10.6

The Buyer acknowledges that all Products are supplied on the basis that they are being acquired for the purposes of manufacture or re-supply in trade.

Section 10.7

The Buyer may only make representations to any other person about the Products that accurately describe the Specifications.

Section 10.8

The Buyer may not give any other warranty relating to the Products to any person without the express consent of the Supplier.

Inspection and Replacement

Section 11.1

The Buyer will inspect Products within the following times after delivery.

Within three days after delivery for loss, damage or non-conformity to the requirements of this document or the Specifications which can be determined on visual inspection.

Within a reasonable time (but in no case being longer than one month) after delivery for inspection and testing for loss, damage or non-conformity to the requirements of this document or the Specifications which cannot be determined on visual inspection.

Section 11.2

The Buyer must notify the Supplier within the time frames referred to in clause 11.1 if it believes the Products delivered do not conform to the requirements of this document or the Specifications or that the value of Products delivered does not conform to the Order.

Section 11.3

The Supplier will be given the opportunity to investigate and test the Products for the alleged non-conformity.

Section 11.4

If any Products delivered to not conform to the requirements of this document or the Specifications; and that non conformity existed prior to the time that risk of loss of or damage to all Products passed to the Buyer, the Supplier at its option will:
  • Replace, free of charge to the Buyer (including all costs associated with transport) the volume of Products which does not conform; or
  • Refund the amount paid on account of the Purchase Price in respect of the volume of Product which does not conform, less the scrap value of the material.

Section 11.5

The Supplier will use all reasonable endeavours to deliver Products replaced under clause 11.4 as soon as practicable after receipt of the Buyers notice of non-conformity.

Section 11.6

If the Volume of Products delivered is less than that required by the Order, the Supplier will use all reasonable endeavours to deliver additional Products to make up the short delivery to the Buyer as soon as practicable after receipt of the Buyers notice of non-conformity.

Section 11.7

If the Buyer does not take any action referred to in clause 11.2 within the time frames referred to in that clause it will be deemed to have accepted all Products delivered and the Supplier will have no further obligation to the Buyer in respect of that order.


Section 12.1

Any dies made or obtained by the Supplier (whether or not paid for in full or in part by the Buyer) and used to produce Products, will remain the property of the Supplier.

The Supplier may use those dies to make and supply products to other customers.

The Supplier may dispose of those dies at any time at the Supplier’s sole discretion without notifying or accounting to the Buyer.

Section 12.2

In spite of clause 12.1 the Parties may agree that a die must only be used to make and supply Products to the Buyer (an “Exclusive Die”).

The Buyer may be required to pay a fee for an Exclusive Die.

The Company shall not dispose of an Exclusive Die unless that die has not been used to produce a material quantity of Products (having regard to the quantity of Products produced from time to time using that die) during the preceding two years.

If however, this agreement is terminated by the Supplier for any of the reasons set out in part 15 below, the Supplier may use an Exclusive Die to make and supply products to other customers and may dispose of the Exclusive Die at any time at the Supplier’s sole discretion without notifying or accounting to the Buyer.


Section 13.1

If the Supplier or any director or agent of the Supplier is liable to the Buyer for any reason, including in contract, tort (including negligence), breach of any legislative requirement or for any other reason the total liability of the Supplier or any director or agent of the Supplier in respect of each delivery of Product is limited at the Supplier’s option to either:
  • Replacement of that delivery of Products; or
  • The amount paid on account of the Purchase Price in respect of that delivery of Products.

Section 13.2

The Supplier and any director or agent of the Supplier shall not in any circumstances be liable for any consequential loss suffered by the Buyer as a result of the operation of this document or in connection with any Products.

Section 13.3

The provisions of this part 13 survive the expiry or termination of this agreement for whatever reason and are for the benefit of the Supplier and its directors and agents.

Section 13.4

The Buyer will indemnify the Supplier and its directors and agents against any loss or liability whether direct or consequential or costs of any nature whatsoever incurred or suffered by any of them, arising from or in relation to:
  • Any breach of the Buyer’s obligations to the Supplier whether under this document or otherwise in contract, or in tort (including negligence), breach of any legislative requirement or for any other reason; or
  • Any breach of the Buyer’s or any officer, employee or agent of the Buyer’s obligations to any other person whether in contract, or in tort (including negligence), breach of any legislative requirement or for any other reason; relating to the Products.


Section 14.1

The Parties will treat as secret and confidential and will not disclose or permit to be disclosed to any person any information relating to this document, the content of any Order, the Buyer’s requirements for Products and their Specifications and any other commercial relationships between the Parties.

Section 14.2

The Parties will be responsible for all of their officers, employees and agents and any breach by them of the provisions of this part 14 will be deemed to be a default by the relevant Party.

Section 14.3

Unless otherwise specifically agreed in writing, the Supplier remains free to sell Products purchased by the Buyer to any other person and may disclose such information as the Parties may agree from time to time relating to those Products and Specifications for that purpose.

Section 14.4

The provisions of this part 14 survive the expiry or termination of this agreement for whatever reason.

Dies and Intellectual Property

Section 15.1

No warranty either expressed or implied is given by the Supplier that any confidential information or intellectual property used by it will not infringe any patent, trade mark or other proprietary right.

Section 15.2

The Buyer will not use any registered patent rights, or any designs, copyright, or trademarks owned by the Supplier and any other trade name, style or get-up used by the Supplier in respect of its business or the Products, and any property and rights of a similar nature owned by the Supplier anywhere in the world except with the express permission of the Supplier and on terms specified by the Supplier.


Section 16.1

Either Party may terminate this document immediately by notice in writing to the other if the other:
  • Commits a breach of this document (including failing to make payment) which in the case of a breach capable of remedy is not remedied within 30 days of the receipt by the other of a notice from the innocent Party identifying the breach and requiring its remedy;
  • Becomes insolvent or enters into liquidation or bankruptcy or compounds with or compromises with or convenes a meeting of its creditors or has a receiver, administrator or similar statutory manager appointed over all or any part of its assets; or
  • Ceases to function as a going concern or to conduct its operations in the normal course of business.
  • Personal Property Securities Act 1999

Section 17.1

The buyer acknowledges that part 9 creates a security interest (“Security Interest”) (as that term is defined in the Personal Property Securities Act 1999 (“PPSA”)) in the Products.

Section 17.2

The Buyer will at the Supplier’s request promptly execute any documents, provide all necessary information and do anything else required by the Supplier to ensure that the Security Interest constitutes a Perfected Security Interest (as that term is defined in the PPSA) and which will have priority over all other Security Interests in the Product anywhere in the world.

Section 17.3

The Buyer agrees, to the extent permitted by law, that the Buyer shall have no rights under the following provisions of Part 9 of the PPSA to:
  • receive a notice under section 114(1)(a);
  • receive a statement of account under section 116;
  • receive notice of any proposal of the Supplier to retain collateral under section 120(2);
  • object to any proposal of the Supplier to retain collateral under section 121;
  • not have goods damaged in the event that the Supplier were to remove an accession under section 125;
  • not be reimbursed for damage caused when a secured party removes an accession under section 126;
  • refuse permission to remove an accession under section 127;
  • receive notice of the removal of an accession under section 129;
  • apply to the Court for an order concerning the removal of an accession under section 131; and
  • reinstate the contract under section 133.

Section 17.4

The Buyer further agrees that where the Supplier has rights in addition to those under Part 9 of the PPSA, those rights shall continue to apply.

Section 17.5

The Buyer waives its right under the PPSA to receive a copy of any Verification Statement (as that term is defined in the PPSA).

Dispute Resolution

Section 18.1

The Parties must attempt to resolve any disputes between them in good faith by using mediation prior to commencing legal proceedings. Where possible, the mediation shall be provided by an International Chamber of Commerce member.

Section 18.2

This clause will not apply to an application by any Party seeking urgent and declaratory relief from any Court.

Force Majeure

Section 19.1

Neither party is in breach of this agreement if there is any total or partial failure of performance by it of its duties and obligations under this agreement caused by any act of God, fire, act of government or state, war, civil commotion, insurrection, embargo, prevention from or hindrance in obtaining any raw materials, energy or other supplies, labour disputes of whatever nature, outbreak of an epidemic or pandemic of disease or illness and any other reason beyond the control of either Party.

Section 19.2

If either Party is unable to perform its duties and obligations under this agreement as a direct result of the effect of one of such reasons such Party must give written notice to the other of such inability stating the reason.

Section 19.3

The operation of this agreement will be suspended during the period (and only during the period) in which the reason continues. Immediately upon the reason ceasing to exist the Party relying upon it must give written advice to the other of this fact.

Section 19.4

If the reason continues for a period of more than 30 days and substantially affects the commercial basis of this agreement either Party shall have the right to terminate this agreement upon giving 30 days written notice of such termination to the other Party.

Choice of Law

Section 20.1

The validity, construction and performance of this document are governed by New Zealand law. The Parties submit to the exclusive jurisdiction of the courts of New Zealand to determine any matter concerning their rights and obligations.

Section 20.2

The provisions of the United Nations Convention on Contracts for the International Sale of Goods done at Vienna on the 11 th day of April 1980 and the New Zealand Sale of Goods (United Nations Conventions) Act 1994 are hereby excluded and do not apply to this document.


Section 21.1

In this document unless the context requires otherwise:
  • The singular includes the plural and the plural includes the singular.
  • A reference to a gender includes the other gender.
  • A reference to a person includes a partnership or corporation.
  • Headings shall be ignored in interpreting this document.
  • A reference to a person includes (where applicable) its successors, personal representatives and permitted assigns.
  • A reference to writing includes a reference to printing, typing and all other methods of reproducing words in a visible form.

Section 21.2

The parties may specify the address and the manner in which each of them is to receive communications and notices from each other from time to time.

Section 21.3

Any notice or other communication to be given under this agreement must be in writing and will be deemed to have been duly given if left at or sent by:
  • First class post or express or air mail or other fast postal service or courier service; or
  • Registered post; or
  • Facsimile or other electronic media such as email to the address or facsimile number for a Party or such other address as the Party may from time to time designate by written notice to the other(s).
  • Any such notice or other document is deemed to have been received by the addressee seven (7) working days following the date of despatch of the notice or other document by post, or where the notice of other document is delivered by hand or is given by facsimile or other electronic media, simultaneously with its delivery or transmission. To prove the giving of a notice or other document it is sufficient to show that it was despatched.
  • Time is of the essence.

Section 21.4

Neither party may assign any of its rights under this document without the prior written consent of the other.

Section 21.5

The provisions of this document shall not (in the absence of any express provision to the contrary) constitute any partnership or agency relationship between the Parties.

Section 21.6

Each Party to this contract shall give to the other Party immediate notice of any suit or action filed and prompt notice of any claim made against the Party arising out of the performance of this contract.

Section 21.7

If any part or provision of this document is held to be unenforceable or in conflict with the applicable laws or regulations of any jurisdiction, the invalid or unenforceable part or provision shall be replaced with a provision which accomplishes, to such extent as possible, the original business purpose of the part or provision in a valid and enforceable manner, and the remainder of the contract shall remain binding on the Parties.

Section 21.8

The Parties agree to do any and all acts and things to execute and delivery any and all papers and documents necessary or appropriate to effect the intent and purpose of this contract.

Section 21.9

No failure to exercise or delay in exercising any rights under this document will operate as a waiver of those rights. No waiver of any default under this document shall constitute a waiver in respect of any default previously or later occurring.

Section 21.10

This document may be executed in any number of counterparts (including facsimile copies) which taken together will be deemed to constitute the same document.

Section 21.11

Any termination of this contract will be without prejudice to the rights of either Party arising prior to termination unless this contract expressly or impliedly provides the contrary.

Section 21.12

Each of the Parties is responsible for its respective legal and other costs incurred in relation to the preparation and completion of this agreement.

Reasons to choose AW Fraser:

  • AW Fraser exports to all corners of the globe, maintaining a competitive edge in the global marketplace through a commitment to quality engineering and manufacturing.
  • AW Fraser maintains its own laboratory with the latest equipment and can supply reports for all production on request. Read more
  • AW Fraser is accredited to ISO 9001 and ISO 14001, delivering independently accredited quality. Read more
  • AW Fraser has received multiple Supplier Awards from a Fortune 500 company for machined components.

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