Terms & Conditions of Purchase
STANDARD TERMS AND CONDITIONS OF PURCHASE MAY, 2023
- Application. These standard terms and conditions (the “Terms”) apply to any sale of products, equipment, parts, materials and related services (collectively the “Products”) to GraniteFuel Engineering Inc. (“GRANITEFUEL”) by a third party supplier (the “Supplier”) and acceptance of these Terms is an express condition of such a sale. Supplier hereby represents and warrants that it is a validly existing company, partnership, sole proprietorship or other legal entity (“Organization”), and that any individual executing or approving the sale of any Products under these Terms is acting on behalf of such Organization and has the authority to bind such Organization to the Agreement (as defined below).
- Entire Agreement. These Terms, the GRANITEFUEL purchase order (the “GRANITEFUEL PO”) and the GRANITEFUEL Product specifications (the “GRANITEFUEL Specifications”) issued in respect of each supply of Products and any other document expressly incorporated by reference by GRANITEFUEL in a GRANITEFUEL PO (collectively, the “Agreement”) constitute the entire agreement between GRANITEFUEL and the Supplier regarding a sale of Products to GRANITEFUEL by the Supplier and supersede all other discussions, communications, proposals, negotiations, statements, representations, warranties, understandings and the like, whether written or oral. Except as expressly accepted in writing by GRANITEFUEL as evidenced by the signature of a duly authorized representative of GRANITEFUEL, payment for any Products by GRANITEFUEL or delivery of any Products by Supplier does not: (a) constitute acceptance of any of Supplier terms and conditions for any Products, and (b) serve to modify or amend these Terms, and GRANITEFUEL expressly rejects any differing or supplemental terms which may be printed or otherwise found in any purchase order or other document sent by the Supplier. If there are inconsistencies in the documents constituting the Agreement, such documents shall take precedence in the following order: (x) these Terms, (y) the GRANITEFUEL PO, and (z) the GRANITEFUEL Specifications or other contract or document incorporated by reference by GRANITEFUEL in the GRANITEFUEL PO. For purposes hereof, an “Affiliate” of GRANITEFUEL includes any entity directly or indirectly controlling, controlled by or under common control with GRANITEFUEL, where “control” of an entity means direct or indirect beneficial ownership of securities representing 20% or more of the votes attached to all outstanding securities of such entity.
- Terms of Payment. Unless otherwise agreed by GRANITEFUEL in writing, Supplier invoices for GRANITEFUEL’s purchase of Products are payable within NET sixty (60) days of the later of: (i) where a Milestone and Delivery Schedule Addendum to these Terms is incorporated herein pursuant to the GRANITEFUEL PO, the successful completion of the applicable milestone set forth in the milestone payment schedule, in which case only the percentage of the total GRANITEFUEL PO price payable for such milestone as set out in the milestone payment schedule may be invoiced and shall be payable pursuant to such invoice and this Section 3; or (ii) the Acceptance of such purchased Products; or (iii) the date of receipt of the Supplier invoice for such Products. Invoices must be issued by Supplier immediately after shipment. Any invoice received more than 60 days after the Products are delivered or services are performed and Accepted will be considered invalid and non-binding. If prior to any delivery of Products, GRANITEFUEL has a concern regarding the quality of any Products because of a material adverse change in Supplier’s circumstances or otherwise, GRANITEFUEL may withhold payment of all or additional parts of the purchase price for such Products prior to Acceptance of such shipment or delivery and/or GRANITEFUEL may require satisfactory repair or replacement of the applicable Products in accordance with Section 5 of this Agreement. GRANITEFUEL may withhold payment of any amounts due and payable by reason of any set-off of any claim or dispute with Supplier, whether relating to Supplier’s breach, bankruptcy or otherwise.
- Delivery Terms. Each sale of Products shall be shipped in accordance with the IncoTerms 2000 specified in the GRANITEFUEL PO. If shipping instructions are not so specified in the GRANITEFUEL PO for any supply of Products, such supply shall be shipped ex works (IncoTerms 2000). Ex works deliveries of the Products are deemed complete upon receipt of the Products in Concord, Ontario, Canada at the GRANITEFUEL facility specified by GRANITEFUEL in the GRANITEFUEL PO, the GRANITEFUEL Specifications or otherwise.
- Acceptance. GRANITEFUEL has the right to inspect the Products on or after the Delivery Date. GRANITEFUEL, in its sole discretion, may inspect all or a sample of the Products, and may accept all or any portion of the Products (“Acceptance”) or may reject all or any portion of the Products if it determines the Products are non-conforming, defective or non-compliant with the Warranty (as defined in Section 13), by providing Supplier with written notice of same. If GRANITEFUEL rejects any portion of the Products, GRANITEFUEL has the right, effective upon written notice to Supplier, to: (a) rescind this Agreement in its entirety; (b) accept the Products at a reasonably reduced price; or (c) reject the Products and require all necessary alterations, repairs and replacements as may be necessary to fully cure any non-conformance of the rejected Products and/or fulfil the Warranty. Any such alterations, repairs and replacements shall be subject to the Warranty. If GRANITEFUEL requires replacement of the Products, Supplier shall, at its expense, promptly replace the non-conforming or defective Products and pay for all related expenses, including, but not limited to, transportation charges for the return of the defective Products and the delivery of replacement Products. If Supplier fails to timely deliver replacement Products, GRANITEFUEL may replace them with Products from a third party and charge Supplier the cost thereof and terminate this Agreement for cause pursuant to Section 30(a). Any inspection or other action by GRANITEFUEL under this Section shall not reduce or otherwise affect Supplier’s obligations under the Agreement, and GRANITEFUEL shall have the right to conduct further inspections after Supplier has carried out its remedial actions.
- Taxes. Unless otherwise expressly provided by GRANITEFUEL in a GRANITEFUEL PO, the price of the Products shall include and is inclusive of all sales, use, goods, services, excise, value added and any similar taxes, duties and other charges of any kind (including, without limitation export/import charges), any inspection or testing fees or any other tax, fee, penalty or charge of any nature whatsoever imposed currently or in the future by any federal, provincial, state or other government authority, upon or with respect to the sale, purchase, delivery, storage, processing or use of any Product or upon payment to GRANITEFUEL, and all such taxes, fees and other charges shall be paid by Supplier and no liability therefor shall accrue to GRANITEFUEL. In the event GRANITEFUEL is required to pay any such taxes, fees or other charge, Supplier shall forthwith reimburse GRANITEFUEL therefor.
- Extra Charges. Unless otherwise specified, the total price inserted on the face of a GRANITEFUEL PO represents the complete cost to GRANITEFUEL as at the point of delivery specified, and includes all licence fees, patents, royalties, taxes, levies and charges of every description, and charges for crating, boxing or cartage. No charges of any kind, including charges for boxing. storage or cartage, will be allowed unless specifically agreed to by GRANITEFUEL in writing. Any invoices submitted in excess of the established price specified in the GRANITEFUEL PO are void and will not be processed for payment.
- Delivery & Schedule. Time is of the essence in connection with the delivery of Products. As such, Supplier shall deliver the Products in the quantities, at the location (during GRANITEFUEL’s normal business hours) (the “Delivery Point”) and on the date(s) (“Delivery Date”) specified in the GRANITEFUEL PO or as otherwise agreed in writing by the parties. If Supplier, for any reason, unable or unwilling to comply with or anticipates difficulty in complying with the Delivery Date and Delivery Point specified by GRANITEFUEL, Supplier shall promptly notify GRANITEFUEL in writing. If Supplier fails to deliver all Products and related documents (including, but not limited to, drawings, spare parts, manuals and quality documents) according to the Delivery Date, GRANITEFUEL shall be entitled to deduct and retain an amount equal to 1% of the total amount of the applicable order per week or part of the week of delay up to 15% of the total value of the relevant order from payment owing to Supplier. The parties agree that such amounts are reasonable pre-estimates of the damages that GRANITEFUEL will suffer as a result of delay based on circumstances existing at the time the order was issued and are to be assessed as liquidated damages and not as a penalty. If Supplier does not comply with GRANITEFUEL’s delivery schedule, GRANITEFUEL may require delivery by fastest method at Supplier’s cost. For clarity, if Supplier is unable or unwilling to comply with or anticipates difficulty in complying with the Delivery Date and Delivery Point specified by GRANITEFUEL, Supplier shall store or arrange for storage of Products at Supplier’s sole cost and the late delivery of such Products shall not be deemed an Acceptance or completion such order unless specified in writing by GRANITEFUEL as evidenced by the signature of a duly authorized representative in accordance with Section 5. The quantity of any instalment of Products as recorded by GRANITEFUEL upon delivery to GRANITEFUEL is conclusive evidence of the quantity received by GRANITEFUEL on delivery unless Supplier can provide conclusive evidence proving the contrary. Supplier shall be liable for any non-delivery of the Products and shall, subject to GRANITEFUEL’s election, in its discretion, replace the Products within a reasonable time or adjust the invoice respecting such Products to reflect the actual quantity delivered. Supplier acknowledges and agrees that the remedies set forth in this Section 8 are not exclusive and are addition to any other remedies or recourse available to GRANITEFUEL at law.
- Title. Title and ownership of the Products shall pass to GRANITEFUEL upon receipt thereof at the applicable GRANITEFUEL facility in Concord, Ontario, Canada specified by GRANITEFUEL in the GRANITEFUEL PO, the GRANITEFUEL Specifications or otherwise.
- GRANITEFUEL Property. GRANITEFUEL assumes no obligation to furnish Supplier with any supplies, materials, tools or equipment of any nature. All diagrams, specifications, drawings, documents, data, know-how, supplies, materials, tools, jigs, dyes, gauges, fixtures, molds, patterns, equipment and other items provided by GRANITEFUEL to Supplier for the supply of Products shall, as between the parties, be and shall remain exclusively the property of GRANITEFUEL under all circumstances and shall be returned by Supplier forthwith to GRANITEFUEL upon request.
- Risk of Loss. Unless otherwise specified or confirmed in the GRANITEFUEL PO the risk of loss or damage to the Products, including any repaired or replaced items and the responsibility for the payment of insurance premiums and freight, lies with the Supplier until such time as GRANITEFUEL has provided notice of Acceptance of such Products in accordance with Section 5. Supplier shall, at its cost, purchase and maintain insurance on the Products during the process of fabrication, while in transit and during inspection by GRANITEFUEL to insure against the perils of fire and extended coverage including “all risk” insurance, in an amount not less than the full replacement value of the Products, for physical loss or damage including, without limitation, theft, vandalism, mischief, collapse, water damage and such other perils as may be provided in the order. The policy shall cover GRANITEFUEL as an additional insured and shall be primary and non-contributory. Supplier shall provide GRANITEFUEL with documentation satisfactory to GRANITEFUEL evidencing the insurance coverage required in this Section upon request.
- Supplier Obligations Regarding Products. Supplier shall:
- before the date on which the production or provision of the Products are to start, obtain, and at all times during the term of this Agreement, maintain, all necessary licenses and consents and comply with all relevant laws applicable to the provision of the Products;
- comply with all applicable rules, regulations and policies of GRANITEFUEL, including security procedures concerning site access thereto, building security procedures, including the restriction of access by GRANITEFUEL to certain areas of its premises or systems for security reasons, and general health and safety practices and procedures;
- obtain GRANITEFUEL’s written consent, which shall not be unreasonably withheld or delayed/which may be given or withheld in GRANITEFUEL’s sole discretion, prior to entering into agreements with or otherwise engaging any person or entity, including all subcontractors and affiliates of Supplier, other than Supplier’s employees, to provide any Products to GRANITEFUEL (each such approved subcontractor or other third party, a “Permitted Subcontractor”). GRANITEFUEL’s approval shall not relieve Supplier of its obligations under the Agreement, and Supplier shall remain fully responsible for the performance of each such Permitted Subcontractor and its employees and for their compliance with all of the terms and conditions of this Agreement as if they were Supplier’s own employees. Nothing contained in this Agreement shall create any contractual relationship between GRANITEFUEL and any Supplier subcontractor or supplier;
- require each Permitted Subcontractor to be bound in writing by the confidentiality provisions of this Agreement, and, upon GRANITEFUEL’s written request, to enter into a non-disclosure or intellectual property assignment or license agreement in a form that is reasonably satisfactory to GRANITEFUEL;
- ensure that all persons, whether employees, agents, subcontractors, or anyone acting for or on behalf of the Supplier, are properly licensed, certified or accredited as required by applicable law and are suitably skilled, experienced and qualified to provide the Products;
- ensure that all of its equipment used in the provision of the Products is in good working order and suitable for the purposes for which it is used, and conforms to all relevant legal standards and all applicable standards specified by GRANITEFUEL; and
- if applicable, keep and maintain any GRANITEFUEL equipment in its possession in good working order and shall not dispose of or use such equipment other than in accordance with the GRANITEFUEL’s written instructions or authorization.
- Warranties. Supplier warrants that it has good and marketable title to all Products delivered to GRANITEFUEL hereunder, free and clear of any and all liens, security interests and encumbrances of any nature whatsoever. Supplier hereby warrants that, for at least the period of twelve (12) months from the date of Acceptance by GRANITEFUEL of the relevant Product or part thereof, that all Products and all parts thereof shall: (i) strictly conform to the conditions specified herein, the GRANITEFUEL Specifications and any other drawing or specifications provided by GRANITEFUEL to Supplier; (ii) strictly conform to all applicable plans, drawings, samples or models furnished to and approved by GRANITEFUEL; (iii) be of merchantable quality and free from any and all defects in material and workmanship and all defects due to design (other than GRANITEFUEL’s design); (iv) operate as intended and be fit for the applicable and intended purpose; and (v) be of the highest standard of quality applicable for the industry; (collectively, (i) to (v) being the “Warranty”). For clarity, the foregoing warranty shall survive any delivery, inspection, acceptance or payment of or for the Products by GRANITEFUEL. Inspection, testing, Acceptance or use of the Products furnished hereunder shall not affect Supplier’s obligation under this Warranty and such Warranty shall survive any such inspection, test and use. If any Products are found, in the opinion of GRANITEFUEL, to be defective or not in accordance with this Warranty, GRANITEFUEL shall have the right to reject such Products in accordance with Section 5.
- General Indemnity. Supplier shall indemnify defend and hold harmless, at its sole cost, GRANITEFUEL and its Affiliates and its/their respective directors, officers, employees, contractors, shareholders, customers, assigns and successors (collectively, “Indemnitees”) against any and all loss, demand, actions, suit, proceeding, injury, death, damage, liability, claim (including, without limitation any alleged infringement of any patent or other intellectual property right), action, judgment, interest, award, penalty, fine, cost or expense of any nature whatsoever, including reasonable legal fees and professional fees and costs, and the cost of enforcing any right to indemnification hereunder and the cost of pursuing any insurance providers (collectively, “Losses”) arising out of or occurring in connection with the purchase, sale or use of the Products from Supplier or Suppliers’ negligence, wilful misconduct or breach of this Agreement. The forgoing indemnity shall survive Acceptance and payment for Products. In the event that any suit for such Losses is brought, GRANITEFUEL may be represented therein by counsel of its own selection at the cost of Supplier. Supplier shall not enter into any settlement with respect to the foregoing without GRANITEFUEL’s prior written consent.
- Intellectual Property Indemnity. Supplier shall, at its sole expense, indemnify, defend and hold harmless GRANITEFUEL and any Indemnitees against: any and all Losses arising out of or in connection with any claim that the purchase, sale or use of the Products furnished hereunder infringe or misappropriate any patent, copyright, trademark, trade secret or other intellectual property right of a third party. The foregoing indemnity shall survive Acceptance and payment for Products. In the event that any suit for such infringement is brought, GRANITEFUEL may be represented therein by counsel of its own selection at the cost of Supplier. Supplier shall not enter into any settlement without GRANITEFUEL’s prior written consent.
- Liens. Supplier shall not place any, and shall indemnify, defend and hold harmless GRANITEFUEL from and against any and all Losses arising out of or occurring in connection with any encumbrance or lien claimed or alleged for labour or materials furnished in connection with Products.
- Intellectual Property. Any knowledge or information which Supplier shall have disclosed or may hereafter disclose to GRANITEFUEL in connection with the purchase of Products covered hereby shall not, unless otherwise specifically agreed in writing by GRANITEFUEL, be deemed to be confidential or proprietary information of Supplier and shall be acquired by GRANITEFUEL free from any restrictions not expressly agreed in the Agreement as part of the consideration for the purchase of any Products. All intellectual property rights of GRANITEFUEL and its Affiliates in and to any specifications, designs, drawings, visualizations or other information thereof provided by GRANITEFUEL to Supplier are at all times reserved and retained as the sole and exclusive property of GRANITEFUEL and its Affiliates. Neither Supplier, nor its Affiliates (nor their respective successors, assigns, licensees or other transferees) shall enforce (or attempt or purport to enforce) against GRANITEFUEL or its Affiliates, (sub)licensees, manufacturers, and distributors any existing or future patent that claims (or purports to claim) any or part of GRANITEFUEL’s intellectual property, the Products or the use, design, manufacturing, layout and packaging thereof. This non-assertion covenant shall be a covenant that transfers with any sale, license or other disposition or grant of rights under the applicable patent rights.
- Survival. All provisions for the limitation of or protection against liability of GRANITEFUEL and any other provision of an Agreement which by its nature are continuing shall survive the termination, cancellation or expiration of such Agreement.
- Governing Law. The sale of the Products and this Agreement are governed by the laws of the Province of Ontario and the laws of Canada applicable therein. Each of the parties irrevocably attorns to the exclusive jurisdiction of the courts of the Province of Ontario. The United Nations Convention on the International Sale of Goods is explicitly excluded from this Agreement. Service of process, summons, notice, or other document by mail to such party’s address set forth herein shall be effective service of process for any suit, action, litigation or other proceeding brought in any such court. Each party agrees that a final judgment in any such suit, action, litigation, or proceeding is conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law.
- Confidential Information. Supplier shall not disclose proprietary or confidential business or technical information disclosed by GRANITEFUEL to Supplier including, without limitation, such information related to any Products to any third parties and shall not use such information for its own benefit or for any purpose other than for the express purpose for which it was disclosed as set forth in writing by GRANITEFUEL at the time of disclosure. Supplier shall treat all such information with the same degree of care as it applies to its own confidential and proprietary information.
- Assignment. Supplier may not assign all or any part of the agreement for sale of Products without the prior written consent of GRANITEFUEL. Any attempt at assignment or subcontracting shall be null and void unless made in conformity with this Section 21.
- Waiver, Amendment. Any waiver, modification or amendment of the Agreement shall only be effective if such waiver, modification or amendment is contained in a written instrument prepared or otherwise accepted in writing by GRANITEFUEL. A waiver or modification by GRANITEFUEL of any condition or obligation of Supplier hereunder shall not be construed as a waiver or modification of any other condition or obligation and no waiver or modification by GRANITEFUEL granted on any one occasion shall be construed as applying to any other occasion.
- Suspension or Cancellation. No order may be cancelled or suspended by the Supplier without the express written consent of GRANITEFUEL, such consent to be granted in GRANITEFUEL’s sole and unrestricted discretion and upon such terms, including the payment of all costs incurred and profits foregone, as GRANITEFUEL may require.
- Severability. If a binding court determination is made that a provision of these Terms or any other document which forms the Agreement is unenforceable (in whole or in part), then such provision shall be void only to the extent that such determination requires, and the parties shall replace such void provision with one that is enforceable and valid and, to the greatest extent permitted by law, serves the intent and purpose of the void provision. No other provision shall be affected as a result thereof, and, accordingly, the remaining provisions shall remain in full force and effect as though such void, voidable or inoperative provision had not been contained herein.
- Relationship of Parties and No Third Parties. The relationship between the parties is that of independent contractors. Nothing contained in this Agreement shall be construed as creating any agency, partnership, joint venture or other form of joint enterprise, employment or fiduciary relationship between the parties, and neither party shall have authority to contract for or bind the other party in any manner whatsoever. As such, Supplier shall have complete and sole responsibility for and control over its employees, agents and representatives and the means and methods of furnishing Products. This Agreement is for the sole benefit of the parties hereto and their respective successors and permitted assigns and nothing herein, express or implied, is intended to or shall confer upon any other person or entity any legal or equitable right, benefit or remedy of any nature whatsoever under or by reason of this Agreement.
- Compliance with Laws. In the furnishing of Products, Suppler shall comply with all applicable laws, regulations, rules and statutory instruments and shall be responsible for all costs of compliance and shall obtain and pay for any required permits, certificates and licences necessary for the furnishing of Products.
- Audit and Record Retention. Supplier shall maintain complete and accurate records (including records of the time spent and materials used by Supplier in providing the Products in such form as GRANITEFUEL shall approve) and fiscal records (in accordance with generally accepted accounting practices and principles) relating to the provision of the Products under this Agreement for a period of at least 7 years from the date of creation the applicable record. During the term of this Agreement and for a period of 7 years thereafter, upon GRANITEFUEL’s written request, Supplier shall allow GRANITEFUEL to inspect and make copies of such records and interview Supplier personnel in connection with the provision of the Products;
- Changes. GRANITEFUEL shall have the right at any time by written instruction issues to Supplier, make changes, revisions, additions and/or deletions (“Change Order”) concerning the Products. Supplier shall within three (3) days of receipt of a Change Order submit to GRANITEFUEL a firm cost proposal for the Change Order. If GRANITEFUEL accepts such cost proposal, Supplier shall proceed with the changed order subject to the cost proposal and the terms and conditions of this Agreement. Supplier acknowledges that unless otherwise agreed in writing a Change Order may not entitle the performance deadlines under this Agreement to be amended. If any Change Order increases or decreases the cost to furnish the Products, adjusted compensation will be solely as proposed and agreed by GRANITEFUEL in writing in accordance with this Section 28.
- Rights and Remedies. The rights and remedies of the parties hereunder are cumulative and in addition to, and not in lieu of, those which the parties have at law or in equity.
- Termination.
- If Supplier, in the opinion of GRANITEFUEL, fails at any time to perform in a good and workman-like manner, or fails to furnish Products efficiently or diligently, or fails to make prompt payment to suppliers for materials or disregards any applicable laws or the instructions of GRANITEFUEL, or otherwise breaches any provision hereof or if Supplier should become insolvent, makes a general assignment for the benefit of its creditors, or a petition and bankruptcy is filed by or against Supplier, or a receiver is appointed on account of its insolvency or has any legal proceeding commenced against Supplier that, in the opinion of GRANITEFUEL, interferes with the furnishing of Products (in each case, a “Default”) then GRANITEFUEL shall have the right (without prejudice to any other right or remedy) to terminate this Agreement or any order forthwith in its entirety and cause the furnishing of Products to be completed by whatever manner GRANITEFUEL deems appropriate. Thereupon the Supplier shall not be entitled to any further payments for furnishing of Products except as provided herein. Upon completion of furnishing of Products or at such time as GRANITEFUEL elects not to complete furnishing of Products, GRANITEFUEL shall pay to Supplier the amount by which sums properly due Supplier at the time of termination for furnishing of Products exceed the loss and damage to GRANITEFUEL attributable to the Default (including any sums expended by GRANITEFUEL towards completion of furnishing of Products subsequent to termination). If GRANITEFUEL’s loss and damage attributable to the Default exceeds the amount due to Supplier provided for herein, Supplier shall be liable to GRANITEFUEL in the amount of such excess and shall promptly pay such amount upon demand.
- Where a Milestone and Delivery Schedule Addendum to these Terms is incorporated herein pursuant to the GRANITEFUEL PO and GRANITEFUEL has made milestone payments pursuant to such Addendum, if GRANITEFUEL terminates the GRANITEFUEL PO for Supplier’s Default that includes a failure to furnish the Products to GRANITEFUEL in accordance with this Agreement, then Supplier shall reimburse GRANITEFUEL within ten (10) business days of the date of such termination, or such other date promptly following such termination as the parties may agree to, for all milestone payments paid, if any, pursuant to such GRANITEFUEL PO for such Products that are not furnished.
- If, at any time, any customer of GRANITEFUEL cancels or materially defers or delays any order from GRANITEFUEL in respect of which GRANITEFUEL has ordered Products from Supplier, GRANITEFUEL may, at its option, by notice in writing to Supplier, terminate the order for the relevant Products and thereupon Supplier shall immediately cease all or the relevant portions of such order. In such event, Supplier shall be entitled to payment of all actual costs incurred by it in respect of the relevant Products to the date of such notice but not thereafter.
- Counterparts and Delivery. This Agreement may be executed in several counterparts, each of which so executed shall be deemed to be an original and such counterparts together shall be deemed to be one and the same instrument. Delivery of this Agreement or any other agreement or instrument contemplated by this Agreement may be made by facsimile transmission or by portable document format delivered by electronic mail.
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