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PART A. PERFORMANCE IN GENERAL
- ASSIGNMENT
Neither this Contract nor the consideration due hereunder may be assigned by Seller, in whole or in part, without Buyer's prior written consent.
- CHANGES
- Buyer may at any time, by written order, make changes to this Contract. If any such change causes an increase or decrease in the cost of, or the time required for, performance of this Contract, Buyer shall make an equitable adjustment in the Contract Price, the delivery schedule, or both, and shall so modify this Contract. If Buyer changes the Contract delivery date(s) such that Seller is required to work overtime, Buyer shall pay therefor an amount equal only to Seller's actual additional labor costs occasioned by such overtime.
- Buyer’s engineering and technical personnel may from time to time render assistance or give technical advice or discuss or exchange information with Seller’s personnel concerning the Contract Products. Such actions, however, shall not be deemed to be a change under this Changes paragraph and shall not be the basis for any equitable adjustment. Only an authorized representative of Buyer’s Purchasing Department may change this Contract.
- Within twenty (20) days from the date of receipt of any written change order, Seller shall submit to Buyer a detailed written estimate of the impact of the change on the Contract Price, the performance or delivery schedule, and the performance capabilities of any Contract Products. Upon receipt of this estimate, Buyer shall begin good faith negotiations with Seller to determine an equitable adjustment to the Contract.
- The failure of the parties to agree to any equitable adjustment shall be dispute under the Disputes paragraph of this Contract. Nothing in this Changes paragraph, however, shall excuse Seller from proceeding with diligent performance of this Contract as changed.
- COMPLIANCE WITH LAW
Seller shall, in the performance of this Contract, fully comply with all applicable federal, state and local laws, rules, regulations, orders, conventions, ordinances and standards that relate to the Contract Products. Seller shall defend, indemnify and hold Buyer harmless from any and all claims and liabilities resulting from any failure to so comply.
- CONFIDENTIALITY OF DATA AND INFORMATION
Information furnished by Buyer and identified by Buyer as "NASSCO Proprietary/Trade Secret Information" or otherwise identified as subject to restricted access or dissemination shall be and remain property of Buyer; shall not be duplicated, used or disclosed to third parties except for the purpose and to the extent necessary for the performance of this Contract; and upon completion of this Contract, shall be delivered to Buyer or destroyed by Seller as Buyer specifies (including all copies). Seller shall take all reasonable precautions to maintain in confidence all such information, including the imposition upon any person, firm, or corporation to whom disclosure of such information is made in the course of performance under this Contract of conditions relating to the confidential treatment thereof to the same effect as those imposed upon Seller herein. The obligations imposed upon Seller herein shall not apply to such information that is already known to Seller, is lawfully obtained or obtainable by Seller from another source, is or comes into the public domain other than as a result of breach of this Confidentiality of Data and Information paragraph.
- CONTRACT ACCEPTANCE, INTEGRATION AND MODIFICATION
- Seller shall strictly perform this Contract. Acceptance of this Contract is expressly limited to the terms and conditions hereof and shall be made by executing the "acknowledgment copy" of the purchase order and returning the same to Buyer. If for any reason Seller should fail to accept this Contract in writing, any performance by Seller of any portion of this Contract shall constitute complete acceptance of this Contract. Any terms proposed in the acceptance of this Contract, which add to, vary from, or conflict with the terms and conditions of this Contract, are hereby objected to and shall be void.
- This Contract constitutes the entire agreement between the parties and supersedes all previous communications, representations or agreements, whether oral or written, between the parties. No terms other than those set forth herein or in the purchase order shall apply. Seller represents that, in entering into this Contract, it does not rely on any previous oral or implied representation, inducement, or understanding of any kind.
- This Contract may be amended or modified only by a written instrument executed by authorized representatives of both Buyer and Seller.
- DEFINITIONS
- "Buyer" means National Steel and Shipbuilding Company.
- "Contract" means the purchase order, these Terms and Conditions, the Specifications, and any other documents incorporated by referenced by the purchase order.
- "Contract Price" means the total price to be paid by Buyer to Seller for the proper furnishing of the Contract Products as set forth in this Contract.
- "Contract Products" means the products, goods, material, supplies, equipment, articles or data to be furnished by Seller.
- "Seller" means the individual or entity identified on the face of the purchase order by whom the Contract Products are to be furnished.
- "Specifications" means the technical specifications, plans, data, drawings, diagrams, schedules and any other documents, which describe the Contract Products.
- DISPUTES
- Any dispute between Buyer and Seller in connection with or arising out of this Contract shall be resolved by means of the following procedures:
- The dispute initially shall be referred to each party’s senior executive with responsibility for this Contract, who shall negotiate in good faith to reach a resolution of the dispute.
- In the absence of a resolution being achieved within thirty (30) days after either Buyer or Seller offers to conduct the negotiations in subparagraph (a)(i), above, either party may take appropriate action pursuant to subparagraph (b) hereof.
- Any dispute not resolved in accordance with subparagraph (a), above, may be resolved by any lawful means, including litigation, which shall be initiated by either party in a court of competent jurisdiction in San Diego County, California, and both parties consent to such exclusive jurisdiction and venue.
- In resolving any dispute under this Contract, each party shall bear its own attorney's fees and costs.
- Until final resolution of any dispute hereunder, Seller shall diligently proceed with the performance of this Contract as directed by Buyer.
- EXPORT CONTROL COMPLIANCE AND COOPERATION
Seller shall comply with the Export Administration Regulations (15 CFR 730—774), the regulations issued by the Office of Foreign Assets Control (31 CFR Chapter V), and all other applicable laws, regulations and orders that control the export of commercial and dual-use items and associated technology. In addition, Seller shall inform Buyer in writing of the name and citizenship of each employee of Seller and Seller’s subcontractors at any tier who will participate in the performance of this Contract at Buyer’s facilities who is not a United States citizen or lawful permanent resident and the name and address of each subcontractor at any tier who will participate in such performance that is not organized under the laws of any state of the United States. Seller shall cooperate fully with Buyer in applying for any export license or approval which may be required for any such employee or subcontractor and in justifying and documenting any license or approval exception. Seller shall not permit any such employee or subcontractor to participate in the performance of this Contract over Buyer’s objection based on noncompliance with this Export Control Compliance and Cooperation paragraph.
- INDEMNITY
Seller shall defend, indemnify and save Buyer, its affiliated companies, and each of their directors, officers, agents and employees, free and harmless from and against all claims and liabilities of any nature, and all costs and expenses incurred in connection therewith (including, but not limited to, attorneys fees) for death or injury to persons (including, but not limited to, agents and employees of Seller and its subcontractors) and for damage or loss of property arising directly or indirectly out of or in connection with the performance of this Contract, including, without limitation, claims and liabilities based in whole or in part on the negligence or other theory of liability of Seller or Seller’s subcontractors, and excluding only claims and liabilities based on Buyer’s sole negligence or willful misconduct.
- INDEPENDENT CONTRACTOR
In performing this Contract, Seller and its employees and subcontractors shall be an independent contractor to Buyer and shall not be an agent or employee of Buyer. Seller shall be solely responsible for determining the means and methods of performing this Contract. Seller assumes full responsibility for the payment of all compensation, expenses, and benefits (including, but not limited to, Workers' Compensation, medical, and other benefits) to its employees and for all state and federal income tax, unemployment insurance, social security, disability insurance, and other applicable withholdings.
- INSPECTION AND ACCEPTANCE
The Contract Products, including any documents, materials, equipment, and facilities, shall at all times be available for inspection and testing by Buyer. Buyer's inspection or failure to inspect shall not relieve Seller of any obligations or liability under this Contract, nor shall it constitute acceptance of the Contract Products. Seller shall repair or replace any nonconforming Contract Products at Seller's expense within ten (10) days of Buyer's written notice of nonconformance. If Seller has not repaired or replaced such nonconforming Contract Products within the 10-day period, Buyer may repair or replace such nonconforming Contract Products at Seller's expense. The Contract Products shall be accepted when Buyer determines that they conform to this Contract, and such acceptance shall be conclusive of conformance except for latent defects, fraud or gross negligence.
- INTERPRETATION
This Contract shall be enforced and interpreted under California law without regard to which party drafted the Contract or to California's choice of law provisions. If any provision of this Contract is determined to be unenforceable, all other provisions shall remain in effect. This Contract shall not be varied, supplemented, qualified or interpreted by any prior course of dealing or usage of trade. Paragraph headings are for convenience only and shall not be used to interpret this Contract. In the event of any conflict or inconsistency between any provisions of this Contract, the following precedence shall be followed: the purchase order; these Terms and Conditions; the Specifications; any other document incorporated by reference by the purchase order.
- INVOICES AND PAYMENT
- Invoices shall include: the purchase order number; the invoice number; description of all Contract Products furnished; the dates and methods or shipment or delivery; comprehensive, itemized prices; prior payments received; terms; and discounts. Unless otherwise provided, any cash discount period shall commence on the date of receipt of Seller's invoice. Incorrect and incomplete invoices shall be returned for correction and shall delay the commencement of Buyer's obligation to pay for the Contract Products and any discount period until a corrected invoice is received by Buyer. Buyer shall pay Seller only for the complete, proper and timely performance of this Contract, and Buyer shall have the right to withhold payment for any failure of Seller to strictly comply with this Contract. No payment of any portion of the Contract Price shall constitute acceptance of the Contract Products.
- Buyer shall pay Seller within thirty (30) days from receipt of a proper invoice by Buyer.
- LIENS
- Seller waives any and all rights to any lien against Buyer by Seller or Seller’s subcontractors.
- Buyer shall have the right to withhold any payment until Seller shall furnish current written releases and waivers of all rights to claim or file liens, properly executed by Seller and its subcontractors. Seller’s acceptance of full payment of the Contract Price shall constitute satisfaction in full and release of all claims or demands of Seller and its subcontractors against Buyer arising out of or connected with this Contract. If Seller fails or neglects to pay any admitted claims for labor or material, Buyer may pay such claims and deduct such payments from funds due Seller hereunder or, if such claims be disputed, withhold sufficient funds to pay such claims until they are resolved. Seller shall immediately discharge or cause to be discharged any lien or charge of any kind which at any time is filed against the property of Buyer with respect to, or arising from, the performance of this Contract. If any such lien or charge is not immediately discharged, Buyer may discharge or cause to be discharged such lien or charge at the expense of Seller.
- NONWAIVER
Buyer's waiver of any provision of this Contract shall not constitute wavier of that provision in any later circumstances or waiver of any other Contract provision.
- NOTICES
Unless expressly directed otherwise, notices required by this Contract to be given by Seller or Buyer to the other party shall be personally served upon Seller or Buyer or served by facsimile and first class mail addressed to the appropriate address hereinafter set forth or to such other address as Seller and Buyer may hereafter designate by written notice. If served by facsimile and first class mail, service will be considered complete and binding on the party served immediately upon completion of said facsimile transmission, as evidenced by a confirmation of successful transmission.
- To Seller:
As indicated on face of the purchase order
To Buyer:
National Steel and Shipbuilding Company
P.O. Box 85278
San Diego, CA 92186-5278
Attn: Manager, MRO Purchasing
Facsimile Number: (619) 544-3677
- PROPERTY RIGHTS
All data and materials prepared or developed by Seller in connection with the furnishing of the Contract Products shall be Buyer's exclusive property and shall be provided to Buyer upon completion of performance of this Contract, upon termination of this Contract, or upon Buyer's earlier request.
- REMEDIES
All remedies are cumulative, and the exercise of a remedy conferred by this Contract or in law or equity shall not preclude the exercise of any other remedy under this Contract or in law or equity.
- SCOPE OF PERFORMANCE
Seller shall provide all labor, materials, equipment, tools, services, and supervision, and shall bear all items of expense, necessary for the complete and satisfactory performance of this Contract, except such items that Buyer, in this Contract, specifically agrees to provide to or for the use of Seller. Any labor, materials, equipment, tools, services or supervision not specifically described in this Contract, but which may be fairly implied as required thereby or necessary to properly furnish the Contract Products, shall be deemed within the scope of this Contract and shall be provided by Seller at Seller’s sole expense.
- TERMINATION FOR DEFAULT
- Buyer may terminate this Contract for default if Seller: fails to assure timely performance; fails to perform on time; ceases performance prior to completion of this Contract; evidences insolvency or financial inability to perform; or fails to cure the material breach of any other provision of this Contract within ten (10) days of notice of such breach.
- In the event Buyer terminates this Contract in whole or in part, Buyer may procure, upon such terms and in such manner as Buyer may reasonably determine, products similar to the Contract Products specified herein, and Seller shall be liable to Buyer for any excess costs for such similar products. If this Contract is terminated only in part, Seller shall continue the performance of this Contract to the extent not terminated.
- Upon termination of this Contract, Seller shall immediately cease performance; shall immediately return to Buyer all information, materials and documents acquired from Buyer; and shall immediately provide to Buyer all information, materials and documents prepared or developed by Seller in connection with performance of this Contract. Further, Seller's obligations as set forth in the Property Rights and the Confidentiality of Data and Information paragraphs herein shall survive any termination of this Contract.
- THIRD PARTY RIGHTS
This Contract is intended solely for the benefit of Buyer and Seller and is not intended for the use or benefit of any other party. Nothing contained in this Contract is intended to make any person or entity that is not a signatory to this Contract a third party beneficiary of any right created by this Contract.
- TIME OF PERFORMANCE
- Seller shall perform this Contract in a diligent manner and in no event later than the time(s) specified on the face of the purchase order. Time of performance as specified in this Contract is of the essence of this Contract. If at any time it reasonably appears to Buyer that Seller is failing to make progress, such that performance may not be completed in accordance with this Contract, Seller shall, within seven (7) days of a written request by Buyer, assure timely performance and represent to Buyer in writing Seller’s best completion date. If the represented completion date is not within the original time for completion of performance of this Contract, Buyer may terminate this Contract for default in accordance with the Termination for Default paragraph. Buyer shall further have the right, but not the duty, and without waiver of any other rights and remedies that it may have, to extend the time for completion of performance. The new date for completion of performance shall be final, of the essence of this Contract, and subject to further change only in accordance with this Contract.
- Seller shall not be liable for delays caused by force majeure events that are beyond the control and without the fault or negligence of the Seller, including, but not limited to, acts of God or the public enemy, fires, earthquakes, floods, epidemics, quarantine restrictions or natural disasters, on condition that Seller notifies Buyer of any such force majeure events within five (5) days of the start of any such delays. Seller shall cooperate with Buyer, and Seller shall use its best efforts, to recover any such delays caused by any such force majeure events.
- WARRANTY
- Seller expressly warrants for a period of one (1) year from acceptance by Buyer that all Contract Products shall conform to this Contract and be free from defects in design, material, workmanship and fabrication. If any nonconformities or defects are discovered in the Contract Products, which are not caused by Buyer, Seller shall replace or repair any nonconforming or defective Contract Products at Seller's sole expense within ten (10) days of Buyer's written notice. If Seller has not replaced or repaired such nonconforming or defective Contract Products within the 10-day period, Buyer may replace or repair such nonconforming or defective Contract Products at Seller's expense.
- Seller hereby assigns to Buyer all warranties provided by the manufacturers of the Contract Products and their components.
PART B. PERFORMANCE AT BUYER'S FACILITIES
In the event that Seller, its employees, agents and subcontractors (including delivery persons), enters any facility owned, leased or operated by Buyer (including Buyer’s shipyard at 28th Street and Harbor Drive, San Diego, California), Seller shall comply with the following additional terms and conditions. Performance at Buyer’s facilities includes, but is not limited to, delivery of the Contract Products, rework and guarantee work.
- CLEAN-UP OF WORK SITE
During the performance of this Contract, and upon delivery of the Contract Products or earlier termination of this Contract, Seller shall remove all debris, garbage or other waste material, including excess materials, scrap and equipment used or generated in performance of this Contract from Buyer's facilities. Seller shall be liable for and shall pay to Buyer, upon demand, all costs of removal for materials or equipment not so removed.
- ENVIRONMENTAL
Seller shall comply with Buyer’s environmental policies and procedures and with all federal, state and local laws and regulations regarding the use and disposition of hazardous substances.
- INSURANCE
- Without prejudice to Buyer’s rights and Seller’s obligations under the Indemnity paragraph herein, Seller shall keep and maintain in effect at its sole cost and expense the following policies of insurance:
- Commercial General Liability insurance with coverage to include broad form property damage, personal injury, premises, completed operations, and products and contractual liability (specifically insuring the liability assumed under this Contract); and with a minimum bodily injury and property damage combined single limit of $2,000,000 per occurrence and $2,000,000 in the aggregate.
- Commercial Automobile Liability insurance with coverage to include owned, hired, and non-owned vehicles; and with a minimum bodily injury and property damage combined single limit of $2,000,000 per occurrence.
- Workers' Compensation and Longshore and Harbor Workers' Compensation Act insurance with limits conforming to the statutory requirements of the State of California and the United States of America, respectively.
- If Seller or its employees are assigned aboard a vessel for any reason and to any extent, Jones Act coverage with minimum limits of liability of $2,000,000 per occurrence and $2,000,000 in the aggregate.
- If required on the face of the purchase order, Seller shall keep and maintain in effect at its sole cost and expense professional liability (errors and omissions) coverage with minimum limits of liability of $1,000,000 per occurrence and $1,000,000 in the aggregate.
- Each such policy shall be underwritten by an insurance company satisfactory to Buyer; shall provide that it is primary insurance to, and noncontributing with, any other insurance carried by Buyer; and shall obligate the insurer to give Buyer not less than thirty (30) days prior written notice in the event of policy cancellation or any material change therein. Certificates evidencing such policies, in a form satisfactory to Buyer, shall be delivered to Buyer upon issuance of the purchase order, and renewals thereof shall be sent to Buyer at least ten (10) days prior to the expiration of the respective policy terms. The policies referred to above in subparagraphs (a)(1) and (a)(2) shall be endorsed to name Buyer as an "additional insured," and the certificates provided to Buyer shall reflect such endorsement. The policies referred to above in subparagraphs (a)(3) and (a)(4) shall contain a waiver of subrogation in favor of Buyer.
- Notices regarding insurance policies shall be provided in writing and shall be deemed delivered five (5) days after deposit in the U.S. Mail, postage prepaid, certified mail and return receipt requested, when addressed to National Steel and Shipbuilding Company, Attention: Risk Manager (M/S 20-E), P.O. Box 85278, San Diego CA 92186-5278.
- The insurance coverage limits stated above are minimum insurance coverage requirements, not limits of Seller’s liability. Notwithstanding the above-required insurance policies, Seller shall be obligated for the full and total amount of any damage, injury, expense or loss.
- SAFETY
- Seller shall be solely responsible for the safe conduct of all persons employed by Seller and its subcontractors. Seller shall comply with all applicable federal, state, and local health, safety and fire protection laws and regulations. Seller shall also comply with Buyer's safety policies and procedures. Any failure by Seller or any of its suppliers to comply with any such safety policies, procedures, laws or regulations shall constitute a material breach of this Contract. Under no circumstance shall compliance with Buyer's safety policies and procedures alone be considered complete satisfaction of the requirements of this subparagraph.
- Seller shall complete the following prior to performance at Buyer’s facilities:
- Provide to Buyer's Safety Department the name, telephone number and title or position of the person who has the authority to correct any safety violations by Seller during the performance of this Contract ("Seller’s Safety Representative").
- Seller's Safety Representative, together with equivalent representatives of Seller’s subcontractors who are expected to perform at Buyer's facilities, shall meet with Buyer's Safety Manager or designee to review applicable safety policies and procedures.
- Provide to Buyer's Safety Department a copy of Seller's written safety policies and procedures.
- Provide to Buyer's Safety Department a copy of all Material Safety Data Sheets ("MSDS") for all chemical compounds that Seller anticipates using in performing this Contract at Buyer's facilities.
- Cause each of Seller’s and Seller’s subcontractor’s employees who will be in Buyer's facilities to complete a "Personal Protective Equipment" statement acknowledging their safety responsibilities.
- Seller shall immediately notify Buyer's Safety Department, in writing, upon receiving notice of any inspection from either United States OSHA or California OSHA representatives of their work area at Buyer's facilities. In the event of such an inspection, Seller shall permit Buyer's personnel to be present at any opening conference, the inspection, and any closing conference, and Seller shall provide Buyer with copies of all correspondence, including citations, received from OSHA or Cal OSHA.
- If, in Buyer's sole opinion, Seller fails to comply with this Safety paragraph, Buyer, may without prejudice to any other legal or contractual rights of Buyer, issue an order stopping all or part of Seller’s performance. Seller shall have no claim for extension of time or for compensation or damages by reason of or in connection with such stoppage.
- Seller shall remove from Buyer's facilities any of Seller’s or Seller’s subcontractor’s employees immediately upon Buyer's request based upon (in Buyer's sole opinion) violation of Buyer's safety policies or procedures or violation of applicable federal, state or local safety laws or regulations.
- SECURITY
Seller shall comply with Buyer's security policies and procedures regarding personnel administration, vehicle operations, and general security practices. Willful or repeated negligent noncompliance by Seller or any of its subcontractors with any such security policies or procedures shall constitute a material breach of this Contract.
- TREATMENT AT BUYER'S MEDICAL FACILITIES
Buyer shall have no obligation to furnish medical treatment to Seller's or Seller’s subcontractor’s employees while such employees may be working in Buyer's facilities. In the event Buyer's Medical Department furnishes medical treatment to any such employee, Seller shall defend, indemnify and hold harmless Buyer, its affiliated companies, and the directors, officers and employees of each of them, from and against any and all claims, demands or causes of action, by Seller's employees or their representatives, heirs or assigns for costs or damages (including without limitation punitive damages and reasonable attorney fees) arising out of or in connection with medical treatment furnished by Buyer, including claims based upon the negligence of Buyer, and excluding only claims based on Buyer’s sole negligence or willful misconduct.
- USE OF BUYER'S EQUIPMENT
Seller shall not use, or permit any third party to use, any of Buyer's equipment, tools, devices, apparatus or property ("Buyer's Equipment") without Buyer's express, written consent. If Buyer so consents, Seller shall ensure that only qualified, properly trained persons use Buyer's Equipment and that such persons obey all of Buyer's applicable use procedures and requirements and all applicable federal, state and local laws and regulations. If Buyer so consents, Buyer's Equipment is provided "as-is," with no warranty, express or implied, as to its merchantability, fitness for any particular purpose, current condition, or prior maintenance history. Seller is responsible for all risk of loss of or damage to Buyer's Equipment used by Seller.
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