(a) These terms and conditions shall govern the delivery of Items or performance of Services provided by Seller under an Order. All documents provided for under an Order shall be in English. Any additional or different terms and conditions contained in Seller’s order document, any prior quotation, or any acknowledgment of an Order (including, but not limited to, any shrink-wrap or click-through terms) that are not negotiated by the Parties and identified on the Order are explicitly rejected by Buyer without further notice of rejection and shall be of no effect nor under any circumstances binding upon Buyer. Seller expressly represents that in accepting the Order it does not rely and has not relied upon any written or oral representation, warranty, or statement not set forth in the Order and that it will not have any right or remedy rising out of any representation, warranty, or other statement not expressly set out in the Order.
(b) The headings and subheadings of Articles contained herein are used for convenience and ease of reference and do not limit the scope or intent of the Article. The terms and conditions of the Order shall be construed and interpreted as consistent whenever possible. Any conflicts in an Order shall be resolved by giving precedence in the following order:
(i) the Order document
(ii) the master agreement entered into between the Parties, if any (which is incorporated by reference in any Order issued hereunder)
(iii) these General Terms and Conditions (which are incorporated by reference in any Order issued hereunder)
(iv) the statement of work
(v) any specifications, drawings, manuals, or other requirements attached hereto or incorporated herein by reference
(vi) any supplement terms, conditions, or provisions (such as an End User License Agreement) negotiated between the Parties and identified on the Order.
Any of the following acts by Seller shall constitute acceptance of the Order:
(a) Items and Services shall be delivered or performed in accordance with the schedule, shipping instructions, and delivery location set forth in the Order. Buyer reserves the right to refuse shipments made in advance of the schedule set forth in the Order and may return early delivery shipments at Seller’s expense. If Buyer choses to retain the Items shipped in advance of the schedule date, Buyer may make payment in accordance with the original delivery schedule in the Order. Buyer shall not be responsible for any additional costs associated with early delivery. Buyer may also refuse deliveries made after the scheduled delivery date set forth in the Order, and in such case, will not be liable to Seller for any Items or Services not accepted. Acceptance of early or late deliveries shall not be deemed a modification of Seller’s obligation to make future deliveries in accordance with the delivery schedule set forth in the Order.
(b) When any delays in delivery occur or Seller anticipates difficulty in complying with the delivery date set forth on the Order, Seller shall immediately notify Buyer in writing. Such notice shall include a revised schedule and shall not constitute a waiver to Buyer’s rights and remedies hereunder. Seller shall take all steps necessary to avoid or minimize delay. Except to the extent delay is caused by Buyer, all of the costs of delay and any additional effort shall be borne by Seller. Seller, at the request of Buyer, shall provide:
(i) a written explanation for the root cause of the delay
(ii) a corrective action plan to address the late deliveries
(iii) assurances that Seller will make all future deliveries in accordance with the Order requirements and schedule. Such corrective action plan and assurances shall be satisfactory to Buyer as determined by Buyer in its sole discretion. If Buyer agrees to accept deliveries after the delivery date has passed, Buyer shall have the right to direct Seller to make shipments by the most expeditious means, and the total cost of such expedited shipment and handling shall be borne by Seller.
(c) Seller shall comply with Buyer’s routing and shipping instructions. If Buyer’s routing and shipping instructions are not attached to the Order or have not been previously received by Seller, Seller shall immediately request such instructions from Buyer. Seller shall remain liable for any and all additional charges which accrue as a result of Seller’s failure to comply with Buyer’s routing and shipping instructions, including Buyer’s specified carrier.
(d) Unless otherwise specified in the Order, Seller shall be responsible for safe and adequate packing conforming to the requirements of carriers’ tariffs or, in the absence of such requirements, conforming to the best commercial practices. Seller shall separately number all containers, packages, etc., showing the corresponding number on the invoice. An itemized packing slip bearing the Order number must be placed in each container. Unless set forth in the Order, Seller shall not charge extra for packaging or packing materials.
(e) Any over-shipment allowances require prior Buyer authorization and will be applied to either the line item or the entire Order, at Buyer’s discretion. Unauthorized over-shipments shall be returned to Seller at Seller’s sole expense.
(f) Unless otherwise specified in the Order, Seller shall bear the risk of loss and damage to all Items supplied hereunder until final acceptance by Buyer, Buyer’s customer, or the Government. Buyer shall have equitable title to all Items for which interim, partial, or progress payments have been made to Seller.
(a) Seller and its suppliers and subcontractors shall establish and maintain a quality management, inspection, safety, and counterfeit parts program acceptable to Buyer and consistent with current industry standards (e.g., ISO9001, AS9100, AS9003, AS9120, AS5553, AS6496, AS6174, etc.). Unless otherwise specified in an Order, Seller shall comply with the requirements of Edco Supply Quality Manual, or corresponding MIL SPEC required by the Government. Seller shall permit Buyer to review procedures, practices, processes and related documents to determine such acceptability. Seller shall have a continuing obligation to promptly notify Buyer of any violation or deviation from Seller’s approved inspection/quality control system and to advise Buyer of the quantity and specific identity of any Items or Services provided to Buyer during the period of any such violation or deviation. If Seller learns of any violations of its obligations, Seller shall within forty-eight (48) hours so notify Buyer and within sixty (60) calendar days must rectify the non-compliance issues. If the violation is not corrected and certification has not taken place within this time frame, then Buyer at its sole discretion may terminate the Order. Seller will notify Buyer of any changes that affect quality within twenty-four (24) hours of that change. These changes include, but are not limited to, change in key management or personnel, change in equipment or machinery, change in source of supply of key materials, change in address or site configuration.
(b) Seller must be able to provide full traceability for all the items included in the Order, this includes and applies to certificates of compliance and individual parts and materials.
(c) Subject to applicable national security regulations, Seller shall provide Buyer and Buyer’s customer right of access, on a non-interference basis, to any area of Seller’s or Seller’s supply chain sub-tier premises where any part of the work is being performed. Seller shall flow this requirement down to its sub tier supply chain suppliers and subcontractors as a condition of the Order. Seller shall, without additional costs to Buyer, provide all reasonable in-plant accommodations, facilities, and assistance for the safety and convenience of Buyer and Buyer’s representatives in the performance of their duties.
(d) An Order may include requirements for design, test, inspection, verification (including production process verification), use of statistical techniques for product acceptance, and related instructions for acceptance by Buyer, and as applicable, critical items including key characteristics and requirements for test specimens (e.g., production method, number, storage conditions) for design approval, inspection/verification, investigation or auditing. Seller shall properly test and inspect its Items in accordance with the Order requirements and applicable law. Buyer and Buyer’s customer shall have the right, but not the obligation, to inspect and test material, work in process, services and supplies. Seller shall keep and maintain inspection, test, and related records, for a period of six (6) years following completion of the Order. Seller shall allow copies to be made and shall furnish all records required by Buyer or Buyer’s customer.
(e) Seller shall notify Buyer within forty-eight (48) hours upon Seller’s discovery that any Item or Service is non-conforming. If Seller delivers a non-conforming Item or Service, Buyer may, at its option and Seller’s expense:
(i) return the Item for refund or credit.
(ii) accept all or part of the Item or Service at a mutually agreed upon price reduction or other consideration.
(iii) require Seller to promptly correct or replace the Item or Service.
(iv) obtain a conforming Item or Service from another source;
(v) cancel the Order for default.
(vi) exercise any other applicable rights or remedies. Buyer shall specify in writing the reason for any rejection of a non-conforming Item or Service. If Buyer elects to return the non-conforming Item or Service, Seller shall provide disposition instructions regarding the non-conforming Item or Service, and if applicable, the date the non-conforming Item or Service will be repaired or replaced and returned to Buyer. Seller shall bear all risk of loss for the non-confirming Item or Service and be liable for any increase in costs, including re-procurement costs, attributable to Buyer’s rejection of the non-conforming Item or Service. If Buyer rejects an Item or Service as non-conforming and Seller does not acknowledge Buyer’s rejection and plan of disposition for the Item or Service within two (2) business days, Buyer will be entitled to dispose of the non-conforming Item or Service without liability to Seller. Additionally, Buyer may elect to return the non-conforming Item or Service back to Seller at Seller’s risk of loss and expense.
(f) Buyer’s payment for any non-conforming Item or Service will not constitute final acceptance by Buyer, limit or impair Buyer’s right to exercise any rights or remedies, or relieve Seller of responsibility for the non-conforming Item or Service. In the event Buyer decides for any reason to accept a non-conforming Item or Service, any costs incurred by Buyer for testing, evaluating, and manufacturing relating to the design changes to the Item or Service, shall be responsibility of Seller, and Seller may not pass along any costs in relation to the design changes.
(g) Final acceptance by Buyer of the Items or Services provided hereunder shall take place only after complete delivery of all Items or Services in accordance with the delivery schedule specified in the Order, or later as agreed upon by the Parties in writing, and after final inspection of those Items or Services by Buyer and Buyer’s customer. Final acceptance shall be contingent upon agreement by Buyer and Buyer’s customer that the Items or Services conform to the requirements of the Order. Final acceptance by Buyer is final, except for latent defects, negligent or intentional misrepresentations by Seller that a nonconformity or defect would be or has been cured or did not exist, acceptance induced by false or negligent assurances of Seller, or as otherwise provided in the Order or applicable law. Final acceptance by Buyer of the Items or Services delivered hereunder shall not limit, void, or affect in any way the warranty or indemnity granted by Seller hereunder. Payment alone shall not constitute final acceptance of the Items or Services rendered. The requirements and obligations in this Quality Control and Non-Conformance Article are material terms of the Order.
(a) Unless otherwise provided by Buyer on the face of the Order, terms of payment are net sixty (60) calendar days from the latest of the following:
(i) Buyer’s receipt of an accurate and approved invoice.
(ii) the date the Items or Services are delivered and finally accepted.
(iii) the date provided in the Order for receipt of Items or completion of Services. Seller shall notify Buyer in writing within thirty (30) calendar days of the occurrence of any alleged payment disputes. Buyer shall pay Seller the prices set forth on the Order for Items delivered and finally accepted or Services rendered and finally accepted, less any deductions provided in the Order. If Seller does not return the acknowledgment page of the Order and commences performance, Buyer shall only be responsible for payment for the work performed to the extent that the work was required by Buyer, not to exceed the amounts set forth in the Order, and if the Order is cost-reimbursable, only to the extent the costs are allowable under the FAR. All payments shall be made in U.S. Dollars with no adjustments for currency exchange rates. The Parties shall consider the invoices paid on the date the check is postmarked and mailed to Seller. For invoices subject to a prompt payment discount, the discount period will be computed from the date of receipt of a correct invoice to the date Buyer issues a check.
(b) Seller shall issue a separate invoice in English for each shipment or each billing period. Seller shall not backdate any invoices. Unless otherwise instructed by Buyer, each invoice shall include:
(i) Buyer Order number and line number.
(ii) Buyer line description (as referenced on the Order)
(iii) the unit price and total price.
(iv) Seller’s invoice number and date.
(v) the payment terms.
(vi) a description of the work performed. Upon Buyer’s request, Seller shall provide a reconciliation of all invoices submitted to Buyer.
(vii) Certificates of conformance for all the items listed in the Order. Certificates of Compliance must contain the following
(c) Each payment made shall be subject to a reduction for any amounts found by Buyer, Buyer’s customer, or Seller not to have been properly payable, including any overpayments. Seller shall promptly notify Buyer of any overpayments and remit the overpayment amount to Buyer along with a description of the overpayment. To the extent permitted by applicable law, Buyer, and any affiliate or subsidiary of Buyer, may withhold, deduct, or setoff all money due, or which may become due, from Buyer arising out of Seller’s performance under the Order or any other transaction Buyer and its affiliates or subsidiaries may have with Seller.
(d) Unless otherwise approved by Buyer in writing, the prices for the Items and Services in the Order include and Seller shall be responsible for the payment of any applicable federal, state, and local taxes, duties, tariffs, or other similar fees (collectively “taxes”) imposed by any government, unless Seller obtains an applicable exemption. Seller represents that the price does not include any taxes, impositions, charges, or exactions for which it is eligible to obtain or has obtained a valid exemption certificate or other evidence of exemption. Any taxes in the Order shall be itemized separately on Seller’s invoice.
(f) If Seller, its subcontractor, or prospective subcontractor at any tier fails to:
(i) Submit and/or certify accurate, complete, and current cost or pricing data.
(ii) Claim an exception to a requirement to submit cost or pricing data and such exception is invalid.
(iii) Violates any applicable laws rules, regulations, ordinances, or the Order, and, as a result of that failure:
(1) Buyer’s customer reduces Buyer’s contract price or fee
(2) Buyer’s costs are determined to be unallowable
(3) Any fines, penalties, withholdings, or interest are assessed on Buyer
(4) Buyer incurs any other costs or damages, then Buyer may make a reduction of the corresponding amounts (in whole or in part) plus any other costs incurred including attorneys fees in either the price of the Order or any other contract with Seller, or recover from Seller an amount equal to the reduction plus any other costs incurred including attorney’s fees. Additionally, upon occurrence of any of the circumstances above, Seller shall be liable and shall pay Buyer at the time any overpayment is repaid: (A) simple interest on the amount of such overpayment to be computed from the date(s) of overpayment to Seller to the date Buyer is repaid by Seller at the applicable underpayment rate effective for each quarter prescribed by the Secretary of the Treasury under 26 U.S.C. § 6621(a)(2); and (B) if Seller knowingly submitted cost or pricing data which were incomplete, inaccurate, or non-current, a penalty equal to the amount of the overpayment.
(a) Buyer may, at any time and without notice to third parties, unilaterally direct changes in writing for:
(i) drawings, designs, or specifications
(ii) method of shipment or packing
(iii) time and/or place of delivery, inspection, acceptance, or performance
(iv) the quantity of Items ordered or Services to be performed
(v) the statement of work
(vi) method or manner of performance
(vii) any property, facilities, equipment, or materials to be provided by Buyer under the Order
(viii) the terms and conditions of the Order required to meet Buyer’s obligations under the Buyer’s customer contract.
(b) During the performance of the Order, Seller shall not make any changes in the Services to be performed or in the design or manufacturing of Items to be furnished by Seller under the Order, including any changes to the process, manufacturing location, or use of suppliers and subcontractors, without advance notification to and written approval of the Buyer’s Procurement Representative. Only the Buyer’s Procurement Representative has authority on behalf of the Buyer to make changes to the Order, which shall be in writing. Items or Services that change without prior notification and consent shall be deemed nonconforming Items or Services under the Order. The issuance of information, advice, approvals, or instructions by Buyer’s technical personnel shall be deemed expressions of personal opinion only and shall not affect the Parties’ rights and obligations hereunder, unless the change expressly states that it constitutes an amendment to the Order and is signed in writing by the Buyer’s Representative. If Seller considers that Buyer’s conduct constitutes a change, Seller shall notify Buyer immediately in writing as to the nature of such conduct and its effect upon Seller’s performance.
(c) If any written change causes an increase or decrease in the estimated costs or the time required for the performance of the Order, Seller shall promptly notify the Buyer’s Procurement Representative and assert its claim for equitable adjustment in writing within thirty (30) calendar days after the written change is ordered or within such extension as Buyer may grant in writing. Buyer may, in its sole discretion, consider any such claim regardless of when asserted, except that no claim for equitable adjustment shall be allowed after final payment. Nothing in this clause shall be deemed to constitute acceptance by Buyer of the validity of Seller’s claim or any part thereof. Once asserted, an equitable adjustment to the Order price and/or delivery schedule may be made and the Parties may modify the Order in writing accordingly. Nothing contained herein, including failure of the Parties to agree upon any equitable adjustment, shall excuse Seller from proceeding without delay with the Order as changed by Buyer’s written direction.
(a) Fixed Price Orders.
(i) At any time, Buyer may, in its sole discretion and by written notice, direct Seller to terminate work under the Order, in whole or in part. In such event, Buyer shall have all rights and obligations accruing to it either at law or in equity, including Buyer’s right to title and possession of any of the Items and Services paid for by Buyer. Upon notice of termination, Buyer may take immediate possession of all work so performed.
(ii) Upon notice of termination, Seller shall immediately stop work and limit costs incurred on the terminated work. In the event Buyer partially terminates the Order, Seller shall continue the performance of the Order to the extent not canceled.
(iii) Upon notice of termination for convenience, Seller shall submit a settlement proposal to Buyer within sixty (60) calendar days (unless otherwise extended in writing) with full supporting documentation for all costs claimed.
(a) Buyer may terminate the Order for default, in whole or in part, by written notice to Seller if:
(i) Seller fails to make delivery of the Items or perform the Services within the time specified in the Order;
(ii) Seller fails to perform any of the other obligations of the Order, or fails to make progress, so as to endanger the performance of the Order;
(iii) Seller is sanctioned, suspended, or debarred by the Government;
(iv) it is found that Seller has a potential, actual, or apparent personal or organizational conflict of interest related to or arising out of its performance of the Order and Buyer determines that such conflict cannot be adequately avoided or mitigated; or
(v) Seller fails to agree upon any deletion, amendment, or addition to the Order that is required by statute, executive order, or applicable regulation.
(a) Upon written notice by Buyer, Seller shall have five (5) calendar days to cure such deficiency, unless Buyer extends the cure period in writing.
(b) Seller shall promptly notify Buyer if Seller:
(i) becomes insolvent or makes a general assignment for the benefit of creditors
(ii) files a petition or application or commences any proceeding under any bankruptcy or similar statute or has a petition or application filed or any such proceeding commenced against it. In such event, Buyer may determine Seller’s financial condition endangers the completion of performance and may require Seller to post such financial assurance, as Buyer, in its sole discretion, deems necessary. Seller’s failure to remedy any insolvency, assignment, petition, or post such financial assurance upon seven (7) calendar days’ written notice shall constitute a default under the Order. The rights and remedies of the Buyer in this clause are in addition to any other rights and remedies provided by law or equity under the Order.
(c) After receipt of notice of termination for default, Seller shall stop work under the Order on the date and to the extent specified in the notice of termination for default.
(d) Buyer may require Seller to transfer title and deliver to Buyer, in the manner and to the extent directed by Buyer, any partially completed Items and any raw material, parts, plans, drawings, Services, and information (“Materials”) as Seller has produced or acquired for the performance of the Order. Seller further agrees to protect and preserve property in the possession of Seller in which Buyer has an interest.
(e) If Seller is terminated for default pursuant to this clause, Seller shall be liable to Buyer for any excess repurchase costs incurred in acquiring goods and/or services similar to those terminated for default, and for any other damages, whether or not repurchase is effected.
For the purposes of this Change of Control Article, “Change of Control” means:
(a) Seller shall defend, indemnify, and hold harmless Buyer, its officers, directors, customers, agents, employees, successors, and assigns against any and all claims, actions, awards, liabilities, damages, losses, and expenses, including attorneys’ fees, expert fees, and court costs, arising out of or relating to:
(i) Seller’s breach of any warranty contained in the Order
(ii) death, personal injury, destruction, or damage to real or tangible personal property, contamination of the environment, and any associated clean-up costs caused or contributed to by Seller or Seller’s agents, subcontractors, employees, or anyone acting on behalf of Seller
(iii) any negligent act, omission, or willful misconduct of Seller or any of Seller’s agents, subcontractors, employees, or anyone acting on behalf of Seller
(iv) the violation by Seller or Seller’s personnel of any applicable federal, state, or local law, including but not limited to export control, hazardous substance, toxic substance, and hazardous conditions laws
(v) any employment-related claims, including those arising from Worker’s Compensation or Occupational Disease law, brought by Seller’s personnel against any indemnified party of Buyer
(vii) Seller’s failure to keep its work, all Items supplied by Seller hereunder, and Buyer’s premises free and clear of all liens and encumbrances, including mechanic’s liens, in any way arising from performance by Seller or by any of its vendors or subcontractors.
(b) Except to the extent that the U.S. government assumes liability therefor, Seller shall, at Seller’s expense, defend, indemnify, and hold harmless Buyer, its officers, directors, customers, agents, employees, successors, and assigns from all claims, actions, awards (including, but not limited to, awards based on infringement of patents known at the time of such infringement, exceeding actual damages and/or including attorneys’ fees and/or costs), liabilities, damages, losses, and expenses, including attorneys’ fees, expert fees, and court costs, arising out of or relating to the actual or alleged infringement or misappropriation of a third party’s patent, copyright, trademark, trade secret, or other intellectual property right. Seller’s infringement indemnification obligation does not apply to the extent the infringement claim arises from Seller’s adherence to Buyer’s written instructions or direction which involves the use of other than items or merchandise of Seller’s origin, design, or selection or where Seller’s Item has been modified by anyone other than Seller and the infringement or claim of infringement arises as a result of such modification. The Seller’s infringement indemnification obligation shall be excluded from any limitation of liability.
(c) If the Items or Services become or are likely to become the subject of an infringement claim, then, in addition to defending the claim and paying any damages and attorneys fees as required above, Seller shall, at its option and expense, either:
(i) promptly replace or modify the Items or Services, without loss of material functionality or performance, to make it non-infringing
(ii) promptly procure for Buyer the right to continue using the Items or Services pursuant to the Order. If after using commercially reasonable efforts Seller fails to provide one of the foregoing remedies within forty-five (45) calendar days of notice of the claim, Buyer shall have the right to terminate the Order with no further liability to Seller, and Seller shall refund to Buyer all amounts paid for the infringing Items or Services.
(d) Buyer shall provide Seller with prompt written notice of any indemnified claim, permit Seller to control the defense and settlement of such claim, and reasonably cooperate and assist Seller in connection with the defense and settlement of such claim; provided that all settlements shall require prior written approval by Buyer. Seller shall provide Buyer with regular updates as to the status of the defense and settlement, including copies of documents and materials associated with the defense and settlement. Seller agrees to pay or reimburse all costs that may be incurred by Buyer in enforcing Seller’s indemnification obligations, including attorneys’ fees.
(b) Seller shall keep reasonably detailed records of the Order for a period of no less than six (6) years from the date of final payment or expiration of any Item warranty or support, whichever is later. Seller shall provide Buyer, Buyer’s customer, and regulatory authorities access to all applicable records and all facilities associated with the Order.
(a) Seller shall comply with all applicable federal, state, and local laws, orders, rules, regulations, and ordinances, including any environmental, transportation, or employment regulations. Seller shall procure all licenses and permits, pay all fees and other required charges, and comply with all applicable guidelines and directives of any local, state, and federal government authority. Unless otherwise specified in the Order, export licenses will be obtained by the Buyer. If Buyer determines that Seller has violated any of the obligations, including but not limited to any obligations set forth in this Compliance Obligations Article, Buyer may, in its discretion, either terminate the Order and/or require Seller to implement a corrective action plan as a condition of continued or future business. The violation of any applicable law, rule, or regulation shall be deemed a material breach of the Order.
(b) Reporting Obligations. To the extent applicable, Seller agrees to provide to Buyer all Item content information required to satisfy both Buyer’s content reporting obligations and Buyer’s customers’ reporting obligations.
(c) Certificates. Upon Buyer’s request, Seller agrees to furnish to Buyer or directly to Buyer’s customer, any certificate required to be furnished under these General Terms and Conditions. A “certificate” may include any plan or course of action or record-keeping function (e.g., a small business subcontracting plan for which flow down is required).
(d) Equal Opportunity. Buyer and Seller shall abide by the equal opportunity federal and state laws that prohibit discrimination on the bases of race, color, religion, sex, sexual orientation, gender identity, national origin, disability, or veteran status and require affirmative measures to prevent discrimination on those bases from occurring, including employment and advance in employment requirements.
Seller shall establish and maintain environmental, safety and facility procedures, data security procedures, and other safeguards against the destruction, corruption, loss or alteration of Buyer’s data and to prevent access, intrusion, alteration or other interference by any unauthorized third parties of the same, that are: (i) no less rigorous than those maintained by Seller for its own information or the information of its customers of a similar nature and scope; (ii) no less rigorous than the accepted practices in the industry; and (iii) no less rigorous than those required by applicable data security and privacy statutes and regulations. Buyer data shall be maintained by Seller as Confidential Information under this Agreement.