Terms & Conditions | The Federal Group USA

Buyer’s General Terms & Conditions For Sale

These terms and conditions (“Terms”) shall govern orders, purchases releases (collectively, “Orders”) to The Federal Group USA (“TFG”)  placed by TFG’s customers (“Buyer”). All Orders shall be deemed to be an acceptance of these terms and conditions. These terms supersede all other terms, conditions, or contract obligations, including any additional or conflicting terms, contained in Buyer’s forms or documents. No modification of these Terms shall be effective nor bind TFG in any manner whatsoever unless expressly agreed in writing by a TFG executive officer.


TFG’s proposal or quote (“Proposal”) is an offer to enter into a contract that is expressly contingent on these Terms. A contract is formed only by the Buyer’s submission of an Order, which constitutes a definite and reasonable expression of acceptance of TFG’s Proposal and the expressly contingent Terms contained therein. TFG rejects any additional or different terms contained or referenced in the Buyer’s Order. TFG’s issuance of an Order Summary does not constitute an acceptance of any offer made by Buyer.

Payment Terms

Net 30 days, unless alternative terms agreed to in writing.

Engineering Charges / Deposits

Engineering charges include but are not limited to the set-up of the program partial tooling, development, inspection, and air freight of FAI parts. (“Engineering Charges”). Engineering charge(s) and / or Deposit(s) are due upon receipt of invoice. Project timeline will commence upon receipt of these charges. Payment of the Engineering Charge does not constitute ownership of tooling.


All sums due to TFG which are paid after the date due shall be subject to an interest rate of eighteen percent (18%) per annum, or the maximum legal rate, whichever is less. The Buyer shall be liable for all costs of collection, including, but not limited to, TFG’s reasonable attorneys’ fees, court costs and disbursements.


Standard bulk packaging, unless otherwise specified in a writing executed by TFG. 

FAI / PPAP Part Submission

Parts submitted for inspection and approval must be approved or rejected by the Buyer in writing (including any and all inspection reports documenting dimensional findings) within seven (7) business days from receipt of samples by Buyer. The Buyer’s failure to respond in writing within this time period shall be treated as an acceptance of the submitted samples. In the event of approval or rejection outside seven (7) business days, Buyer may be subject to additional charges for, but not limited to, engineering, setup, raw material, obsolescence, and tooling. Sample approval is not a condition precedent to Buyer’s obligations under the contract. The Buyer is responsible for payment of all product(s) that meet print specifications as documented.


On Orders for parts or materials TFG has the right to ship and bill part quantities up to 10% more than the purchase order amount. The Buyer agrees that a shipment of product quantities in an amount within 10% less than the purchase order amount constitutes substantial performance of TFG’s obligations under the contract.

Urgent Delivery

TFG’s price calculation is based on standard ocean freight and/or trucking charges Air shipments will not be made unless Buyer completes the Air Freight Authorization Form. The Buyer will pay expedited shipping costs and expenses, regardless of the parts acceptance. These shipping charges are due Seven (7) days after the receipt of the invoice.

Shipment Mode

Shipments will be scheduled via best way in accordance with the stated lead times. Each shipment or delivery hereunder shall be construed and considered as a separate sale insofar as the Buyer’s obligation to accept and pay for the parts under the terms of the contract, and Buyer agrees to accept and pay for each such shipment or delivery without regard to other shipments or deliveries. If shipments are delayed at the request of the Buyer, payment shall be due based on the day when TFG was first prepared to make shipment, and parts shall be held at Buyer’s sole risk and expense. Should Buyer fail to accept or to pay for any shipment or delivery, TFG may, without prejudice to any other lawful remedy, defer further shipments or deliveries until acceptance or payment by Buyer; alternatively, TFG, may, at its option, and without any liability, terminate the contract as to any unaccepted or undelivered portion thereof, as well as any other outstanding contract with Buyer, and Buyer shall be responsible for any expenses or losses sustained by TFG as a consequence of such termination.

Agreement Not To Circumvent

For a period of four (4) years after the final communication between Buyer and TFG relating to the contract, the Buyer hereby agrees for himself or herself, its officers, directors, agents, associates and any and all related parties, that they will not, directly or indirectly, contact, deal with or otherwise become involved with any entity or party introduced or otherwise referred to directly or indirectly, by or through TFG, including, specifically, suppliers and manufacturers, without the specific written approval of TFG. Specifically, Buyer acknowledges that TFG may expend significant effort in developing a custom part for Buyer with a given supplier or manufacturer. Buyer hereby agrees not to circumvent TFG by dealing directly with such a supplier or manufacturer for such custom parts, regardless of whether Buyer had a prior relationship with such a supplier relating to other parts.

Agreement Not To Disclose

The Parties irrevocably agree that they shall restrict access to Confidential Information to employees, contractors, and third parties (Personnel) who have a need to know for the purposes contemplated by this Agreement. The Receiving Party will ensure that its Personnel comply with this Agreement and are subject to confidentiality agreements that contain terms and provisions comparable to those in this Agreement. The confidential information provided by one party to the other or otherwise acquired, includes but is not restricted too,  contract terms, product information or manufacturing processes, prices, fees, financial agreement, schedules and information concerning the identity of TFG, producers, buyers, lenders, borrowers, brokers, distributors, refiners, manufacturers, technology owners, or their representative and specifically individuals names, addresses, principals, or mobile/fax/telephone numbers, references, product or technology information, and/or other information advised by one of the Parties to the other as being confidential or privileged.

Pricing/Rate Of Exchange/Taxes

The pricing of parts which TFG manufactures outside of the United States is predicated on the rate of exchange (the “Base Rate”) at the time the Order is accepted. In the event that rate of exchange between the United States dollar and the currency of the country of origin of the parts shall differ from the Base Rate on the date of delivery, at the discretion of TFG the price of the parts shall be increased or decreased accordingly. Pricing is based upon the current government tariffs, duties, assessments, surcharges and other levies now existing and applicable, and any increase that may hereafter be imposed on the parts, or upon the sale thereof, shall be added to the contract price paid by Buyer. Buyer shall have the benefit of any reduction to the extent that such reduction affects parts remaining to be delivered and/or paid for after such reduction occurs. For purposes of this section “government” shall mean any country, state, city, municipality or other political subdivision, domestic or foreign.

Production Inspection

The receiving inspection shall occur upon receipt of the parts by Buyer at its facility, and is not a condition precedent to Buyer’s obligations under the contract. The bill of lading shall be conclusive as to the condition of the parts, and time and place of shipment.


TFG’s only obligation is to comply with print specifications and/or any additional documents referenced on Buyer’s Order and/or marked as attachments. No other specifications or documents will be recognized unless acknowledged in writing by a TFG executive officer. Any FAI / PPAP part submitted for Buyer approval prior to shipment of production will be considered binding upon approval. By approving a FAI / PPAP part, Buyer agrees that parts provided by TFG that are consistent with the approved FAI / PPAP part satisfy TFG’s obligation to provide such parts under the contract, notwithstanding any conflict with print specifications. The Buyer shall have the right to have third party reports and inspections completed. The charges for these services will be solely the responsibility of the Buyer unless expressly agreed in writing by a TFG executive officer.


The Buyer must submit all claims to TFG in writing within fifteen (15) days after the receiving of the parts.

Force Majeure

TFG shall not be responsible for failure or delay due to causes beyond its control affecting the delivery of the parts. These causes shall include, but not be restricted to, fire, storm, flood, earthquake, explosion, accident, acts of any public enemy, war, rebellion, insurrection, sabotage, terrorism, epidemic, quarantine restrictions, labor disputes, or controversies (including disputes or controversies which exist by reason of the refusal of either party to prevent, settle, or resolve such dispute or controversy on terms unacceptable to it), labor shortages, transportation embargoes, or failures or delay in transportation, fuel or energy shortages, power interruptions or failures, acts of God, acts, rules, regulations, orders or directives of any government or political subdivision, agency or instrumentality thereof, or the order of any court, regulatory, or arbitral body of competent jurisdiction. In such event, TFG may postpone or cancel delivery without further liability.


If the Buyer desires to cancel an Order, Buyer shall send written notice to TFG. Buyer shall not be entitled to cancel any Order placed with TFG without the prior written consent of a TFG executive officer. If such consent is given, the Buyer will remain responsible for: (1) completed production; (2) material in process of fabrication for the Order; (3) materials purchased specifically for the Order; and/or (4) other costs of cancellation imposed by TFG.Return

Parts returned to TFG must be accompanied by an authorization signed by a TFG executive officer. To obtain authorization, Buyer may contact its TFG Sales Engineer. TFG may send parts returned to TFG without authorization back to the Buyer at Buyer’s expense.


Clerical errors are subject to correction and TFG shall not be bound by inadvertent mistakes.

Change In Usage

If Buyer changes the usage of any part supplied hereunder from the usage specified in a request for quotation, or if there is a change in specification or regulation which could cause a change in the applicable rate of Duty, Buyer is responsible for any penalties, past due duty amounts, and/or fees that may be imposed by customs or any other instrumentality of government.


TFG is not design responsible and will manufacture parts to the Buyer’s print and specifications. Parts provided under the contract are on an “as is” basis. TFG makes no warranty, express or implied, with respect to any parts not manufactured by it. TFG shall be released from any and all obligations under any warranty, either express or implied, if any TFG manufactured part is repaired or modified by persons other than its own authorized personnel. TFG expressly and specifically disclaims the implied warranty of, and makes no warranty with respect to, merchantability or the fitness of any part sold under the contract for any particular purpose or use. Since damages, if any, are difficult to ascertain or quantify, the buyer or anyone claiming under any warranty relating to parts sold agrees that if TFG breaches any warranty, or if any part sold proves defective in any manner whatsoever, TFG’s sole liability shall not exceed either (a) replacement of any defective product or, at the option of TFG, (b) refunding to the Buyer the purchase price paid for such parts. If a part which is or has been sold hereunder causes, at any time, any property damage, personal injury, economic loss, or any other damage however defined, the Buyer or anyone claiming through that Buyer or any warranty relating to such part sold, expressly and specifically agrees that TFG shall not be responsible for, and that the Buyer and any other claimant or claimants shall assume all liability for any such property damage, personal injury, economic loss or other damage however defined

Intellectual Property

TFG does not warrant that its parts shall be delivered free of the rightful claim by any third person for infringement of any patent, trademark, design or other intellectual property right. Risk of such infringement shall entirely be borne by Buyer.

All drawings, know-how, designs, specifications, inventions, devices, developments, processes, copyrights, trademarks, patents and applications therefore, and other information or intellectual property disclosed or otherwise provided to Buyer by TFG and all rights therein (collectively, “Intellectual Property”) will remain the property of TFG and will be kept confidential by Buyer in accordance with these Terms. Buyer shall have no claim to, nor ownership interest in, any Intellectual Property and such information, in whatever form and any copies thereof, shall be promptly returned to TFG on written request from TFG. Buyer acknowledges that no license or rights of any sort are granted to Buyer in respect of any Intellectual Property, other than the limited right to use the parts purchased from TFG. The sale of parts by TFG to Buyer does not include any design, development or related services associated with the Intellectual Property of TFG.


Buyer agrees to indemnify, defend, and hold TFG harmless from any claim, demand, loss, liability, damages, or expense (including reasonable attorney’s fees and court costs) made by any third party relating to parts provided by TFG under the contract.


If in TFG’s sole judgment the financial responsibility of Buyer shall become impaired or unsatisfactory to TFG, then such terms of payment and such security for payment as shall be satisfactory to TFG may be demanded by TFG and shall be complied with and/or furnished by Buyer. In the event TFG, for any of the above reasons, requires payment in cash on or before delivery or otherwise alters the terms of payment, Buyer shall not thereby be relieved from the obligation to carry out the balance of the contract, which obligation is expressly assumed by Buyer. By accepting shipment of any parts pursuant to this contract, the Buyer represents and warrants that it has sufficient funds to pay for the parts shipped. If any check, draft or other negotiable instrument tendered by the Buyer to TFG is not negotiated upon presentation to the Buyer’s bank, then any notice of such non-negotiation shall be effective as against Buyer upon actual receipt thereof by TFG.

Title Transfer

Unless otherwise expressly agreed in writing by TFG and Buyer, title to the Products shall be conveyed by TFG to Buyer at the time that the risk of loss of the Products passes from TFG to Buyer.

Applicable Law And Jurisdiction

The contract, unless otherwise stipulated or agreed to in writing, shall be construed according to and governed by the internal laws of the State of Michigan, and without the application of any presumption against a party as draftsman. The Parties agree that jurisdiction of any claim arising out of or relating to the contract, or the breach thereof, shall exclusively be exercised by a competent state court located in Oakland County, Michigan, or the United States District Court for the Eastern District of Michigan. In the event of a dispute between the Parties, the prevailing party shall be rewarded its reasonable costs and fees, including expert and attorney fees.


The contract shall continue in effect as herein above provided, unless sooner terminated in writing subscribed by TFG. TFG shall have the right to immediately terminate this agreement if Buyer shall: (1) become insolvent, commence or file any voluntary or involuntary proceeding or petition in bankruptcy in any court; (2) make any assignment for the benefit of creditors; (3) enter into any composition with its creditors; or (4) suffer the appointment of a receiver for any of the Buyer’s property.

Termination for Convenience

Notwithstanding anything to the contrary in these terms TFG may terminate this Agreement at any time, for any reason or no reason, and without the payment of any termination fees, by giving Buyer thirty (30) days’ prior written notice.


In the event that the parts are imported, TFG shall pay the antidumping duty to which the parts are subject at the time of importation. If, as a result of an administrative review, an agency of the United States imposes any additional antidumping duties upon the parts beyond the antidumping duty order to which the parts are subject at the time of importation, and makes demand upon TFG for payment of such duties, Buyer shall reimburse TFG for such additional duty upon TFG’s presentation of the demand for payment thereof to Buyer. Quoted pricing is subject to the following surcharges at the time of import/invoicing:  Raw Material, Currency Exchange, Freight and/or Tariffs, but not limited to. 

Export Compliance

Buyer and TFG hereby agree to comply fully with all applicable economic sanctions and export control laws and regulations, including, without limitation: 1) those regulations maintained by the U.S. Treasury Department’s Office of Foreign Assets Control (“OFAC”) ; 2) the U.S. Commerce Department’s Bureau of Industry and Security (“BIS”); and 3) the International Traffic in Arms Regulations (“ITAR”) and the Export Administration Regulations (“EAR”) Without limiting the generality of the foregoing, neither party shall directly or indirectly sell, provide, export, re-export, transfer, divert, loan, lease, consign or otherwise dispose of any equipment, product, services, software, source code, or technology received from Buyer under this contract to any person, entity or destination, or for any activity or use restricted by the laws or regulations of the United States or any other applicable jurisdiction without obtaining all required governmental authorizations. Notwithstanding any other portion of this contract neither Buyer nor TFG shall be required to take (or, as the case may be, refrain from taking) any action prohibited or penalized under the laws of the United States or any applicable foreign jurisdiction, including, without limitation, the United States anti-boycott laws administered by BIS and the U.S. Treasury Department’s Internal Revenue Service. Any performance obligation arising under this Agreement is contingent upon the prior receipt of all necessary governmental authorizations and TFG shall not be liable for any breach, non-performance or delay in performance related to the failure to obtain any such authorization. Buyer’s breach of this clause shall constitute cause for the immediate termination of this contract. Buyer agrees to indemnify and hold harmless TFG for Buyer’s non-compliance with this provision. This provision shall survive termination of this contract.


The Buyer further agrees to obtain, at its own cost and expense, insurance against all liability arising from any of its acts or omissions under this contract, including general liability, products liability, completed operations liability and contractual indemnity liability, naming itself and TFG as insured as the interest may appear in the amount of one million dollars ($1,000,000) per occurrence and three million dollars ($3,000,000) aggregate annual limit.



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