Definitions: The following definitions will apply to all Purchase Orders:
1. Compliance with Laws. Seller shall comply with all Federal, State, and local laws, Naval Base Instructions, Notices and Directives, executive regulations, and orders. Seller shall be responsible for obtaining any necessary license and permits applicable to the performance of work. Seller shall produce the Articles in compliance with all requirements of the Fair Labor Standards Act.
2. Interpretation of Purchase Order. This Purchase Order and any documents incorporated by reference or attached constitute the parties’ complete agreement. No prior representations or agreements, either written or oral, shall be considered to change, add to, or contradict this Purchase Order. Any ambiguity, conflict, or inconsistency in the Purchase Order shall be resolved by applying the most reasonable interpretation under the circumstances, considering the parties’ intentions at the time of contracting..
3. Acceptance of Purchase Order. BUYER’S ACCEPTANCE OF THIS CONTRACT IS EXPRESSLY CONDITIONED ON SELLER’S ASSENT TO ALL OF THESE TERMS AND CONDITIONS OF SALE. Any additional or different terms or conditions which may appear in any communication from Seller are hereby superseded and objected to and shall not be effective or binding unless recognized and assented to in writing by Buyer’s President, Vice President, or authorized representative; and no such additional or different terms or conditions in any printed form of Seller shall become part of this contract despite Buyer’s acceptance of the contract, unless Buyer’s written acceptance specifically recognizes and assents to their inclusion. If Seller objects to any of the terms stated herein, Seller shall advise Buyer in writing of the particular objection within ten (10) days or such objection shall be deemed waived. This Purchase Order contains the entire agreement of the parties and expressly limits acceptance to the terms and conditions stated. Any terms and conditions proposed by Seller inconsistent with or in addition to the terms and conditions hereof are objected to and void unless expressly agreed to in writing by the Buyer.
4. Setoff. Buyer shall have the right always to set-off any amount due or payable to Seller hereunder against any claim or charge Buyer may have against Seller.
5. Taxes. The price of the supplies/services procured hereunder includes all applicable federal, state and local taxes and duties unless otherwise stated in the Purchase Order.
6. Seller Contacts with Buyer’s Customer and other Vendors. Seller shall not communicate with Buyer’s customer or Buyer’s other vendors regarding this Purchase Order unless authorized to do so by Buyer. Buyer shall be responsible for all liaisons and communications with Buyer’s customer and with Buyer’s other vendors for the term of this Purchase Order. This clause does not affect the rights of any government entity to initiate communication with the Seller regarding this Purchase Order, and the Seller shall not be considered in breach of this clause under such circumstances (but Seller shall report such communications to the Buyer as soon as practicable).
7. Information Disclosed to Buyer. Any information or knowledge Seller discloses to Buyer regarding this order shall not be deemed confidential or proprietary unless expressly agreed upon by the parties in writing. Any such unpatented information or knowledge shall be acquired by Buyer free of any restrictions.
8. Compliance with Laws. Seller shall comply with all Federal, State, and local laws, Naval Base Instructions, Notices and Directives, executive regulations, and orders. Seller shall be responsible for obtaining any necessary license and permits applicable to the performance of work. Seller shall produce the Articles in compliance with all requirements of the Fair Labor Standards Act.
10. Work on Buyer’s or Buyer’s Customer’s Premises. If this order requires Seller to perform work on Buyer’s or Buyer’s customer’s premises, Seller shall take all necessary precautions to prevent any injury to persons or damage to property during the progress of such work. Additionally, except to the extent that any injury to persons or damage to property is due solely and directly to Buyer’s or its customer’s fault or negligence, Seller agrees to indemnify Buyer and its customer against all loss or liability resulting from any act or omission of Seller, its employees, agents, or subcontractors.
11. Insurance Requirements for Subcontractors working on Government or Offsite Facilities (SELLER and their subcontractors).- Failure to maintain insurance shall give BUYER the right to immediately terminate the Order without prior notice to SELLER. SELLER shall be solely liable for and shall assume the costs of any deductible amounts of self-insured retentions and any liability of SELLER more than the insurance maintained. The insurance that SELLER is required to maintain is as follows:
b. Automotive Liability– Minimum combined bodily injury and property damage: $1,000,000 per occurrence. (Not required if not driving a vehicle at any of our job sites)
c. Work Compensation and Longshoremen’s and Harbor Workers Compensation Insurance– Insurance with limits of liability conforming to the statutory requirements of the United States of America and any state where the work is being performed by Subcontractor’s employees. (US Longshoremen’s and Harbor Workers (USL&H) Coverage not required if employees will not go aboard vessels, piers, wharfs or docks.) (USL&H and Workers Compensation not required if there are no employees other than owners.)
d. Excess Liability– If required to meet the above minimum limits.
e. Jones Act Coverage– If Seller’s employees, subcontractors or suppliers are required to go to sea aboard a Vessel, Seller shall maintain Jones Act coverage with minimum limits of liability of $2,000,000 per occurrence and $2,000,000 in the aggregate.
f. Defense Base Act Coverage– If Seller’s employees, subcontractors or suppliers are required under this Contract to perform any work related to any U.S. Government contract outside of the United States, Seller shall maintain Defense Base Act coverage with minimum limits conforming to the statutory requirements of the United States.
12. Patent, Copyright, and Trademark Indemnity. Seller agrees to indemnity, defend, and hold harmless Buyer, its customer, and those for whom Buyer may act as agent, from any costs, expenses, damages, or liability that Buyer may incur because of any proceedings charging infringement of any patent, copyright, or trademark by reason or sale or use of any supplies/services/data furnished by Seller. Seller shall have no liability, regarding alleged patent infringement for supplies furnished to Buyer in accordance with Buyer’s design specifications.
13. Warranty of Supplies/Services. Seller warrants that all supplies/services furnished under this Purchase Order shall conform to the Buyer’s drawings, specifications, or other description and will be of good material and workmanship and free of defects. Seller further warrants that the supplies/services will meet Seller’s published specifications and standards, will be new (not used or reconditioned), merchantable, and suitable for the purpose intended. These warranties shall survive inspection, acceptance, and payment. Supplies/services that do not conform to the above warranties may, at any time within ninety (90) days after delivery to Buyer, may be rejected and returned to Seller, at Seller’s expense, for correction or replacement. If Seller does not promptly correct or replace same, Buyer may correct or replace the nonconforming supplies/services at Seller’s expense. The forgoing warranties are in addition to all other warranties expressed or implied by law including incidental or consequential damages. Any warranty disclaimer or limitation issued by Seller, whether before or after acceptance of Buyer’s Purchase Order, is hereby rejected and is null and void.
14. Disputes. Any dispute arising under this order shall be settled by agreement between the parties. Pending final resolution, Seller shall proceed with the performance of this order in accordance with Buyer’s instructions.
15. Stop-Work Order. Buyer may, at any time, by written notice to Seller, stop all or any part of the work hereunder for up to ninety (90) days. Upon receiving a stop-work order, Seller shall immediately comply with its terms and take all reasonable steps to avoid incurring any additional costs allocable to such work. If the stop work order results in an increase in price or schedule, the Seller must submit a claim for equitable adjustment within thirty (30) days after the resumption of work.
17. Buyer’s Property and Information. Buyer’s property, such as drawings, specifications, data and the like, furnished to Seller for performance of the work shall remain the property of Buyer, shall be considered private and confidential Buyer information, and shall not be used by Seller for its own purposes or given to a third party without the express written consent of the Buyer. Any designs, drawings, dies, molds, tooling, technical data/information, materials, equipment, etc., that Seller makes or buys from others for producing the supplies/services and charges to Buyer’s account, shall become Buyer’s property immediately upon manufacture or procurement. Upon order completion, all Buyer-furnished property shall be returned to the Buyer in the same condition as received, allowing for reasonable wear and tear, except to the extent that the property has been incorporated into supplies delivered or consumed in the performance of the work. With the prior authorization of the Buyer and Buyer’s Customer, the Seller may be permitted to use any Buyer-furnished, Government-owned property/information to furnish supplies or services for direct sale to the Government on a noninterference basis with this Purchase Order.
18. Inspection and Test. Upon Government request, the following will apply: “Government Inspection is required prior to shipment from your plant. Upon receipt of this order, promptly notify and furnish a copy to the government representative who normally services your plant so that appropriate planning for government inspection can be accomplished. In the event the government representative of office cannot be located, our purchasing agent shall be notified immediately.” Buyer or its customers reserve the right to perform a verification at the supplier’s premises. When intended supplier will be notified about inspection, arrangements shall be made and method of product release shall be stated.
19. Delivery. Seller agrees that time is of the essence in the performance of any Order incorporating these terms and conditions. Deliveries shall be strictly in accordance with the Order delivery schedule. Buyer reserves the right to refuse or return, at Seller’s expense, any excess shipment or deliveries made in advance of the Order schedule. Invoices for early deliveries, when accepted, may be deferred until the scheduled delivery date. Seller agrees to advise Buyer, as soon as possible, of any delays in meeting the Order delivery schedule and the reasons therefore. If a delay is due to causes beyond Seller’s and, when applicable, its subcontractor’s control, and without fault or negligence of either of them, Buyer may, as its sole discretion, either adjust the delivery schedule or terminate the Order for convenience. If the delay is due to Seller’s or its subcontractor’s failure, and the failure is not cured within ten (10) days after Seller’s receipt of Buyer’s notice thereof, Buyer may, at its sole discretion, either accept a revised delivery schedule and an equitable reduction in the Order price or terminate the Order for default. Acceptance of late deliveries shall not constitute a waiver thereof by Buyer.
20. Waiver of Rights. Failure of either party to insist on performance of any provision of this Order shall not be construed as a waiver of that provision or a waiver of Buyer’s or Seller’s right to require compliance with such provision in any later instance. If any provision of this Order is found to be illegal or unenforceable under law, that provision shall be deleted; however, all other provisions of this Order shall not be affected thereby, and shall remain in full force and effect.
21. Insolvency. If Seller ceases to conduct normal business operations (including inability to meet its obligations), or if any proceedings under bankruptcy or insolvency laws are brought by or against Seller, or a receiver for Seller is appointed or applied for, or Seller makes an assignment for the benefit of creditors, Buyer may terminate this Order, without liability, except for deliveries previously made and for supplies completed and subsequently delivered in accordance with the terms of the Order. In the event of Seller’s insolvency, Buyer shall have the right to procure the balance of this Order from others without liability.
22. Notice of Labor Disputes. When an actual or potential labor dispute or other condition delays or threatens to delay the timely performance of this Order, Seller shall immediately notify Buyer in writing. Such notice shall include all relevant information regarding such dispute or other condition. Seller shall insert the essence of this provision in all subcontracts issued hereunder.
23. Title and Risk of Loss. Unless otherwise provided in this Purchase Order, the F.O.B. point shall be the delivery destination indicated in this Order, and title to the supplies and risk of loss or damage shall pass to Buyer upon Buyer’s acceptance of the supplies regardless of where Buyer takes physical possession. If the F.O.B. point is designated as the Seller’s location, then title and risk of loss or damage to the supplies shall pass to Buyer upon Seller’s delivery of the supplies to the carrier.
24. Quantity. It is Seller’s responsibility to furnish the quantity of supplies/services called for in this Order. No variation in the quantity specified herein will be accepted as compliance with this Order. Buyer reserves the right to return excess shipments at Seller’s expense.
25. No Extra Charges. The total price payable to Seller shall be stated in this Purchase Order. The price shall not be increased unless specifically agreed to in writing by Buyer.
26. Dispute Resolution. Any dispute, claim or controversy arising out of or relating to this Agreement or the breach, termination, enforcement, interpretation, or validity thereof, including the determination of the scope or applicability of this agreement to arbitrate, shall be determined by binding arbitration in San Diego, California, before one arbitrator. Any kind of claim is arbitrable hereunder, whether based on statute, tort, contract, common law, or otherwise for which a federal or state court or an administrative agency would be authorized to grant relief. At the option of the first to commence an arbitration, the arbitration shall be administered pursuant to the Commercial Arbitration Rules of a reputable dispute resolution organization similar to the American Arbitration Association, JAMS, or Judicate West. However, the parties expressly incorporate into this arbitration agreement the discovery provisions of California Civil Procedure Sec. 1283.05, with the understanding that the arbitrator shall allow limited but reasonable depositions as appropriate. Judgment on the final arbitration award may be entered in any court having jurisdiction. This clause shall not preclude parties from seeking provisional remedies in aid of arbitration from a court of appropriate jurisdiction or to preserve the status quo pending arbitration.This is a self-executing agreement. Either party requesting arbitration under this Agreement must deliver written demand on the other party in accordance with the notice provisions of this Agreement, with a copy delivered to the selected dispute resolution organization. The arbitration will take place as noticed by the dispute resolution organization regardless of whether one of the parties fails or refuses to participate, and a court order compelling arbitration is not required; nor may a court rule on the validity of the agreement to arbitrate, or on the scope or applicability of such agreement to the dispute.The parties are responsible for their own attorney fees and arbitration costs. The arbitrator may not award attorney fees, legal costs, or arbitration fees to any party.