I. TERMS AND CONDITIONS OF SALE
1. Acceptance of Order. Seller is Neuro Logic Systems, Inc. These Terms and Conditions shall be binding for any order (“Order”) placed by Buyer. If Buyer objects to one or more of the terms herein, such objection must be in writing and received by and accepted by Seller in writing prior to the commencement of performance by Seller. Any of Buyer’s conditions which are contrary to these Terms and Conditions must be accepted in advance in writing by Seller. If any terms on the face of Seller’s Invoice or Order Confirmation differ from or add to these printed terms, the face terms on such Seller’s Invoice or Order Confirmation shall take precedence over these printed Terms and Conditions. Any purchase order or other written form of Buyer shall be construed as an offer and shall not become an effective binding part of these Terms and Conditions, unless signed in advance by an authorized officer of Seller, together with a written agreement that it is incorporated into these Terms and Conditions. Any alteration, variance, or waiver of these Terms and Conditions requires the written approval of an authorized officer of Seller.
2. Price. Prices quoted by Seller are valid for thirty (30) days from date of quotation or as otherwise extended in writing by Seller, and must be accepted in writing within this time. After expiration of this period, Seller may, at its discretion, extend time of quotation or make a revised quotation. Seller reserves the right to correct clerical or typographical errors at any time, even after acceptance. Unless otherwise specified in writing, all prices are in United States dollars (“USD”) and do not include any applicable Federal, State and local taxes, customs and duties.
3. Shipment and Delivery. FOB. Seller shall arrange delivery with a common carrier (“Shipper”) but Buyer shall be solely responsible for all costs and expenses of delivery from Seller’s shipping point and Seller shall invoice Buyer for all shipping expenses. “F.O.B.” means that title and right of possession passes upon delivery to Shipper or payment in full to Seller, whichever occurs last. Shipping dates and/or delivery dates are quoted based on conditions prevailing on the date of the quotations and are subject to rescheduling. All orders, including custom product orders, are subject to reasonable rescheduling of the delivery date and failure of Seller to deliver by the original delivery date shall not be deemed a breach of this Agreement. The time of delivery shall be deemed to have been complied with when the product has been shipped or delivered into the custody of the Shipper at the designated site before expiration of the time of delivery indicated on the Seller’s Order Confirmation. Seller need not ship or deliver as quoted if Buyer has not met its payment or other contractual obligations.
Seller shall not be liable for delays due to performance under any DX rated order for any governmental division, department, agency or otherwise, or due to any causes beyond its reasonable control or due to acts of Buyer, acts of God, changes in local, State or Federal laws or regulations, fires, strikes, floods, epidemics, quarantine restrictions, terrorism, riot or other civil unrest, war, acts of violence, freight embargoes, delays in transportation, etc. (collectively, “Force Majeure Events”).
In no event shall Buyer be entitled to any damages as a result of delays in delivery or late delivery.
Buyer shall have up to ten (10) days after receipt to inspect the product. Unless Seller is notified in writing to the contrary during this period, delivered items shall be presumed to be accepted. Claims for shipment defects, damages or shortages shall be waived unless made within ten (10) days of receipt of the product by Buyer.
If delivery is delayed by Buyer, product held for Buyer may be subject to storage charges and shall be at the sole risk and expense of Buyer.
4. Payments. Unless otherwise specified in writing, Seller’s standard payment terms are pre-payment in full for all new customers and net thirty (30) from receipt upon approved credit with payment due thirty (30) days from date of receipt of the product by Buyer. If the product is not paid for in full, Seller retains all rights to collect payment as provided by law. Invoices will normally be submitted at time of shipment. In the case of partial shipments, payment shall be made prorata based upon each shipment. Payment shall be made if unimportant parts are missing, which do not prevent the product from being used, or if subsequent work on the product is found to be necessary. If Buyer does not make payments when due, it shall without formal notice be liable to pay interest on overdue amounts from the due date, at a rate of one and one-half percent (1.5%) per month or the maximum amount allowable by law, whichever is less. Payment of such interest does not release Buyer from its obligation to make payments on the agreed dates.
Buyer shall not, at any time, be entitled to set off any amount owed by Seller to Buyer against any amount payable by Buyer to Seller.
5. Passage of Title. The title and right of possession to the product remains with Seller until the full contract price (including, if any, deferred payments and any interest charges) has been paid to Seller. Buyer agrees to perform all acts necessary to protect and maintain this title and right. Passage or non-passage of title shall not affect risk of loss.
6. Risk of Loss. Seller bears the risk of loss or damage to the product from the time that Seller delivers to Shipper and during all transportation and delivery of the product to the site designated by Buyer, except if Buyer designates a Shipper other than a nationally recognized shipper such as FedEx or UPS, Buyer shall bear all risk of loss or damage from Seller’s delivery to Shipper and during all transportation and delivery.
7. Warranty And Damages Limitation. Seller warrants that the product delivered and related services rendered pursuant to this Order will be free from defects in material and workmanship, and if the product is designed by Seller, free from defects in design, for a period of twenty-four (24) months from the date of receipt. In the case of spare or replacement parts manufactured by Seller, the warranty period shall be for a period of six (6) months from shipment. Repairs outside the warranty period shall be at standard Seller rates and shall be warranted for twelve (12) months from the date of repair or, if the repair is performed under this warranty, for the remainder of the original warranty period. Seller shall provide repair service for an additional three (3) years beyond the original warranty period at standard Seller rates. Buyer shall report any claimed defect in writing to Seller upon discovery and in any event, within the warranty period. Seller, at its sole discretion, shall promptly repair or replace the product at Seller’s designated repair facility. Buyer shall be solely responsible for all shipping costs and expenses to ship the product to the repair facility. Seller shall be responsible for all shipping costs and expenses to return the product to Buyer up to the amount for standard delivery of the product to the original point of delivery designated on Seller’s Order Confirmation, and Buyer shall be charged for any excess shipping expenses above that amount. If Buyer repairs or replaces product without Seller’s prior written approval, Seller is relieved of obligation to Buyer under this section with respect to such product. The product shall not be deemed defective by reason of normal wear and tear and this limited warranty shall not apply to (i) product (or the services applicable to such product) where the product has been subjected to mishandling, misuse, abuse, alteration, damage, neglect or improper or inadequate storage, maintenance, repair or installation, (ii) product (or the services applicable to such product) that has been subjected to unauthorized or improper repair, installation, assembly, processing or otherwise that alters physical or electrical properties, (iii) damage due to operation of the product other than as per the specifications or use with other components, materials or equipment, (iv) any defect, malfunction or failure caused by accidents, misuse, abuse, unauthorized repair, improper installation or removal of component parts, or use of the product with components or equipment for which it is not intended or (iv) any act of God (such as floods, hurricanes, earthquakes or fires). No other express warranty is given and no affirmation of Seller, by words or action, will constitute a warranty. The foregoing warranty is in lieu of all other warranties either express or implied, including, but not limited to, the implied warranties of non-infringement, merchantability and fitness or suitability for a particular purpose which are hereby expressly waived to the fullest extent permitted by law. There are no warranties which extend beyond the description on the face hereof.
8. Limitation Of All Remedies. In no event will Seller be liable for any special, incidental, punitive, indirect or consequential damages based on breach of warranty, breach of contract, negligence, strict liability, tort, product liability, or any other legal theory to the fullest extent permitted by law, even if Seller has been advised of the possibility of such damages. Buyer expressly agrees that Seller’s sole maximum liability for damages for any cause whatsoever shall be limited to the total price received by Seller for the product and when Buyer accepts the product, Buyer is precluded from seeking any other damages against Seller.
9. Allocation of Risks. This agreement allocates the risks of product failure between Seller and Buyer. This allocation is recognized by both parties and is reflected in the price of the product. Buyer acknowledges that it has read this agreement, understands it and is bound by its terms.
10. Termination for Convenience. Upon thirty (30) days advanced written notice to Seller, Buyer may cancel all or any separable part of this Order. In such event, unless either party shall have defaulted or been in default of performance hereof, either party shall have all rights and obligations accruing to it both at law or in equity, including Buyer’s right to title and possession of product paid for. Seller shall be reimbursed for actual and reasonable cost, plus a reasonable profit for work performed to date of termination, as mutually agreed upon by the parties in good faith.
11. Termination for Default. Either party may terminate this Order or work under this Order in whole or in part (i) immediately by written notice if the other party commits a material breach of any one or more of its terms and fails to cure such default within thirty (30) days after the non-breaching party gives written notice of such breach, or (ii) upon five (5) days advance written notice if either party becomes insolvent, enters voluntary or involuntary bankruptcy or receivership proceedings or makes an assignment for the benefit of creditors.
12. Patents, Copyrights, Trademarks and Trade Secrets. Seller represents and warrants that, to Seller’s actual knowledge, the product and the sale and use thereof do not infringe any valid patent, copyright, trade secret, proprietary right or trademark of any third parties. Seller agrees, at its cost and expense, to indemnify and hold Buyer free and harmless as set forth in Section 13 below.
13. Indemnification. Seller hereby agrees to indemnify and hold harmless Buyer, its officers, directors, and agents from and against any and all liabilities, damages and expenses (including reasonable attorneys’ fees) actually incurred by a third party (a) from a claim that the product provided under this Order infringes, violates or misappropriates a valid patent, copyright, trademark, trade secret or other intellectual property or proprietary right, but only to the extent that Seller had actual knowledge of such infringement and failed to disclose it to Buyer and take reasonable steps to avoid or mitigate the claim and excluding any claim as a result, either directly or indirectly, of Seller’s incorporation of any of Buyer’s drawings, designs, schematics, information, data, software or other items; and (b) for any claim for personal injury or property damage from the proper use of the product provided under this Order that is a result of a breach of the Warranty in Section 7, with such indemnification under this Section 13 limited to an amount not to exceed the extent of Seller’s insurance coverage actually provided by the insurer; provided, however, that this indemnification shall not apply to any liabilities, damages, expenses, or claims incurred as a result, either directly or indirectly, of any negligence, fraud, or acts or omissions of Buyer or any of its officers, directors, affiliates, shareholders, employees, representatives and agents.
14. Changes. Buyer may make reasonable changes in the character or quantity of the product, or in the manner or time of performance of this Order if communicated to Seller in a writing signed by a duly authorized representative of Buyer and accepted in writing by a duly authorized representative of Seller. An equitable adjustment in the price and time for performance will be mutually agreed to by the parties in writing, acting in good faith, if such changes result in a decrease or increase in the Seller’s cost or time of performance. Notwithstanding the above, Seller may, without Buyer’s approval, make revisions to the product that do not affect form, fit or function.
15. Arbitration. Any controversy or claim arising out of or relating to these Terms and Conditions, other than a suit by Seller to collect payment, shall be submitted to final and binding arbitration before the American Arbitration Association (“AAA”) in accordance with the AAA’s Commercial Arbitration Rules. The arbitration is to be conducted in Ventura County, California, by a single arbitrator who is a retired judge. The decision rendered by the arbitrator shall be final and binding upon the parties. The award rendered by the arbitrator shall be final, and judgment thereon may be entered in any court having jurisdiction thereof. Either party may pursue injunctive or other equitable relief without first submitting the claim or controversy to arbitration. The costs of the arbitration shall be paid equally by the parties and the prevailing party, as determined by the arbitrator, shall be entitled to reasonable attorney’s fees as provided in Section 22.
16. Confidentiality; Proprietary Information. Unless otherwise expressly agreed in a contemporaneous or subsequent writing to the contrary, all drawings, designs, specifications, information, data, prototypes, samples, software and other items supplied by one party to the other party in performance of this Order shall remain the confidential and proprietary information of the disclosing party. The non-disclosing party shall hold all such information in confidence and use it solely as strictly necessary to utilize the product (if the non-disclosing party is Buyer) or as necessary to provide the product and any related services (if the non-disclosing party is Seller) and the non-disclosing party shall use for no other purpose, and shall not reproduce, distribute or disclose such confidential information to any third party without the disclosing party’s prior written consent, and shall only disclose such confidential information to employees and independent contractors who may require use of such confidential information in the performance of their duties but only if such employees and independent contractors agree to keep such information confidential and are bound by confidentiality obligations at least as strict as set forth in this paragraph. Any confidentiality obligations shall survive expiration, completion or termination of any order or of this Agreement.
Any non-disclosure agreement signed by the parties is hereby incorporated by reference and made a part of these Terms and Conditions.
Each party shall own, retain and control all rights, title and interest to its Background Intellectual Property. Background Intellectual Property means all Intellectual Property that is owned, licensed to, or controlled by a party and (i) exists or was developed by such party prior to the date of this Order or (ii) was developed independently of performance under this Order. Intellectual Property means all service marks, trademarks, trade dress, trade secrets, copyrights, copyright applications, patents, patent applications, ideas, know-how, processes, methods, inventions, and other intellectual properties and proprietary rights, in whatever form, including, without limitation, drawings, designs, specifications, information, data, prototypes, samples, software, documents and other items. All Intellectual Property that is first made or conceived by Seller solely in the performance of this Order shall be referred to as “New Intellectual Property.” All New Intellectual Property shall be the confidential and proprietary information of Seller, and Buyer shall execute any such documents necessary to perfect Seller’s title thereto. Seller hereby grants to Buyer and Buyer’s customers a perpetual, fully paid up, royalty-free, non-assignable or non-transferable (except as provided below in this Section), and non-exclusive right to use Seller’s Background Intellectual Property that is incorporated into the product and Seller’s New Intellectual Property that is incorporated into the product, solely to the extent necessary to utilize the product.
Each of these licenses shall be non-assignable and non-transferable, except to the extent the United States government, or any subdivision thereof, has the rights to use such license by applicable law and except that Buyer may assign or transfer such license to any affiliate or successor in interest to at least 50% of the ownership of Buyer, by way of merger, consolidation, corporation reorganization or sale of all or substantially all of the assets of Buyer provided such transferee is not a competitor of Seller. Buyer shall not reverse engineer, disassemble or decompile the product or any part thereof, or any prototypes, software, other product, or other tangible objects which embody Seller’s confidential or proprietary information (or both). Buyer agrees not to create, sell or license any derivative works or modifications of the product or any part thereof, and also agrees not to create, sell or license any derivative work, or modifications to, any prototypes, software, other product, or other tangible objects which embody Seller’s confidential or proprietary information (or both).
17. Federal Acquisition Regulations & Flow Down Clauses / Export Control. If this is a government related Order and Buyer has specifically noted Federal Acquisition Regulation (FAR) clauses in (or as an attachment to) Buyer’s Order, such FAR clauses are incorporated by this reference as if set out fully herein, except the word “Buyer” shall be substituted for the words “Contracting Officer” and the term “Seller” shall be substituted for “Contractor” wherever such words appear. Notwithstanding the above, no other provisions of Buyer’s purchase order shall be applicable and any of Buyer’s terms or conditions which are contrary to these Terms and Conditions shall only be valid when accepted in advance in writing by Seller. Seller and Buyer shall not disclose or otherwise transfer, directly or indirectly, any equipment, hardware, software, defense service, information or technical data to any foreign individual or company except in material compliance with the applicable licensing, approval and all other requirements of the US export control laws, regulations and directives, including but not limited to the Arms Export Control Act and the International Traffic in Arms Regulations (ITAR).
18. Relationship of Parties. Seller and Buyer are independent contracting parties and nothing in these Terms and Conditions shall make either party the agent, joint venturer or legal representative of the other for any purpose whatsoever, nor does it grant either party any authority to assume or to create any obligation on behalf of or in the name of the other.
19. No Implied Waiver. The failure of either party at any time to require performance by the other party or make any election under any provision of these Terms and Conditions shall in no way affect the party’s right to require such performance or make such election at any time thereafter, nor shall the waiver of either party of a breach of any provision of these Terms and Conditions constitute a waiver of any succeeding breach of the same or any other provision.
20. Entire Agreement. These Terms and Conditions and the Seller’s Order Confirmation, Invoice or other order confirmations of Seller under which they have been deemed applicable supersede all prior and contemporaneous communications, understandings and agreements of Buyer and Seller (either verbal or written).
21. Modification/Severability/Further Assurances. These Terms and Conditions may not be modified or amended in any way unless such modification or amendment is in writing and signed by an authorized officer of each Seller and Buyer. If any provision of these Terms and Conditions is determined by a court of competent jurisdiction to be invalid under any applicable law, the portion deemed to be invalid will be deemed omitted, and the remainder of these Terms and Conditions shall remain enforceable. The parties agree to execute any further documents and provide any requested assurance reasonably necessary for the parties to effectuate the purpose of these Terms and Conditions.
22. Attorneys’ Fees. In the event of a claim, suit or controversy, including without limitation, a suit to collect payment or an action for declaratory relief, each party in such action or proceeding shall be responsible for its own court costs and out-of-pocket expenses not limited to taxable costs, including, but not limited to, phone calls, photocopies, expert witness, travel, etc., and attorneys’ fees.
23. Governing Law; Jurisdiction; Venue; Compliance with Law. This agreement is entered into in Ventura County, California and shall in all respects be construed and governed by the laws of the State of California and by applicable Federal procurement laws. Buyer and Seller agree and accept that any legal action or proceeding with respect to this agreement shall be brought in the Federal or state courts for the State of California, County of Ventura, and the parties expressly waive any objection to personal jurisdiction, venue or forum non conveniens. Both Buyer and Seller agree to materially comply with the applicable provisions of all federal, state, and local laws and ordinances and all lawful orders, rules, and regulations thereunder.
II. NEURO LOGIC SYSTEMS, INC. PURCHASE ORDER TERMS and CONDITIONS
Document Number: PD01
Status: Released Date: 7-13-17
The following terms and conditions and quality requirements are applicable to every purchase order issued by Neuro Logic Systems, Inc. (NLS) and shall remain in effect without expiration. Additional conditions may apply in accordance with our customers’ requirements as stated on the actual purchase order. Should you have any concerns or require clarification regarding the following, please contact the buyer listed on our PO.
PURCHASE ORDERS: Supplier shall deliver to Buyer the parts or services as stated in Supplier’s written quote, regarding part number or description of service, price and delivery date. Changes made after receipt of Buyer’s purchase order must have Buyer’s written approval. Suppliers are required to notify NLS when there is a discrepancy in piece count or other purchase order detail.
REVISION LEVEL: All processing/service associated with purchase orders must be performed in accordance with the latest specification revision and identified on all documents, unless otherwise specifically requested.
TRACEABILITY: Certificates of Conformance or Process Certifications must identify the Part Number, Revision or Issue, Purchase Order Number, Quantity, Serial Numbers (if applicable), NLS Job or Lot Number, all relevant Specifications with Revisions and Material Heat Number when known; identify the name, title, date and signature of the issuer. All products/components must be traceable to OEM/OCM or their authorized distributors.
QUALITY CONTROL: Supplier shall maintain a quality control system in accordance with ISO9001 (or a more current update) for the goods or services purchased under the Order. Supplier shall have a continuing obligation to promptly notify Buyer of any nonconforming product as result of your process/service. Nonconforming product must not be further processed or delivered without written authorization by Buyer. Immediate notification must be made of any process or product discrepancy and any known or suspected violation or deviation from the quality control system and to identify any goods delivered to Buyer that may be affected.
APPROVED PROCESS SUPPLIERS: You haver been delegated the authority to process and inspect your product to ensure all applicable process and material specifications are met and documented accordingly. You are further required, upon request, to demonstrate and provide evidence that your processes meet planned results and that arrangements have been established for the processes, including:
- Defined criteria for review and approval of the processes (qualification and approval of special processes prior to use)
- Approval of equipment and qualification of personnel
- Use of specific methods and procedures (control of the significant operations and parameters of special processes in accordance with documented process specifications and changes)
- Requirement for records
QMS REQUIREMENT – Approved Process Suppliers must meet the minimum quality management controls for the product or service provided and associated risk:
Special Processors: NADCAP and/or (our) Customer Approval
Machining Suppliers: Neuro Logic Systems’ QMS review (preferred ISO, may use 100% Inspection)
Material Suppliers: ISO9001 and/or BAA and/or (our) Customer Approval
and/or AS6174 and/or Consumer Protection Act HR4173, Section 1502
PROCESS CHANGES: Suppliers are required to notify NLS of changes in product and/or process, changes of supplier, changes of manufacturing facility location and, where required, obtain NLS approval prior to actions.
SUB-TIER CONTROLS: You are required to flow down all applicable purchase order requirements, including NLS’s customer requirements, to your sub-tier suppliers when applicable, including all counterfeit parts prevention requirements. Sub-tier suppliers must be able to provide written documentation of traceability to OEM/OCM or their authorized distributors.
HANDLING: Product must be handled, stored and packaged to prevent damage or deterioration of product appropriate to the current state of manufacture.
CALIBRATION SOURCES: Suppliers comply with the requirements of ISO 17025 or equivalent. All certificate(s) of calibration must reflect compliance.
DOCUMENTATION: When required by contract, Seller must provide with each shipment documented proof of processing (process certification, MIL testing report, physical and/or chemical test result, etc.) traceable to purchase order details.
RECORDS: Suppliers are required to retain quality and process records such as certifications and test reports relating to NLS product, for a minimum of 7 years. After that time, records may be disposed of by shredding only. Records forwarded with shipments (Certificates of Conformance, etc.) must be maintained and protect from deterioration and damage and made available for review by request of NLS, our customers and regulatory authorities in accordance with contract or regulatory requirements.
CUSTOMER PROPERTY: Sub-Contractors who receive NLS parts in order to provide special processes or other service shall have a quality control procedure in place to prevent cosmetic or functional damage to NLS property during handling.
WARRANTY. All product supplied under the Order will be free from defects in material and workmanship and will conform with all requirements of the order, including specifications, drawings, samples or other description furnished by Buyer. All articles purchased are warranted to be of good material and workmanship, and to be free from defect for a period of one year (or the manufacturer’s warranty period, whichever is longer) after delivery and acceptance by Buyer. Warranties shall run to Buyer’s successors and customers.
PACKING AND SHIPMENT: Deliveries shall be as specified, without additional charge for boxing, crating, carting or storage, unless otherwise specified. Goods shall be suitably packaged in accordance with the requirements of common carriers and be packaged to ensure against damage from weather or transportation. Buyer’s Order number must be plainly marked on all packages, bills of lading, and invoices. Packing lists shall accompany each shipment listing all materials and quantities.
DELIVERY: Date of delivery shall mean the date the item is to be delivered at Buyer’s facility. On Time delivery is very important. If Seller is unable to deliver goods on the promised date, Seller shall promptly notify Buyer of the reasons for the delay and the actions being taken to minimize the delay. Buyer may request that Seller share cost of a more expeditious means of transportation.
TITLE AND RISK OF LOSS: Title shall pass to Buyer at Buyer’s destination. Acceptance and passage of title shall not impair the right of Buyer to inspect and reject any item. Seller shall assume and bear the risk of any loss of, or damage to, the supplies covered until delivered at the Buyer’s destination, and for all rejected items after notice of rejection.
PAYMENT: Payment date will be calculated from the date of Buyer’s receipt of an acceptable invoice or Buyer’s acceptance of the goods and supporting documentation at destination, whichever occurs last.
1. OBSOLETE or EOL PARTS: In the event a component is no longer to be stocked or manufactured as part of Seller’s regular product line, Seller shall notify Buyer in writing of any pending future action as soon as Seller has made such decision.
2. CHANGES IN PRODUCT: Any changes to the design, components and/or process of manufacturing the purchased part, including changes of suppliers, changes of manufacturing facility location.
3. FLOW DOWN TO THE SUPPLY CHAIN: If required by government contract, the applicable requirements will be flowed down to supplier’s own vendors.
SUBSTITUTION OF PARTS: Seller will not substitute any part on Buyer’s purchase order without Buyer’s written approval. This includes replacement, upgraded or substituted parts that Seller may consider equal to unavailable part, even if Seller’s part number remains the same. All such substitutions must be approved by Buyer in writing.
WRITINGS REQUIRED: No order, change order, direction, requirement, consent or approval will be valid unless provided in writing. No oral statements will modify or affect the terms of the Order. No extra charge of any kind, or change in the price or delivery schedule of the Order will be allowed unless specifically agreed to in writing by Buyer’s Authorized Representative.
PROPRIETARY INFORMATION: Seller shall not divulge to anyone any of Buyer’s confidential or proprietary information, whether such information was provided verbally or in drawings, designs, specifications, technical information, tools, data or any other form.
INDEPENDENT CONTRACTOR: Seller is an independent contractor, and not an agent or employee of Buyer. Seller will comply with all applicable US laws and regulations including export control laws and regulations and FAR flow downs, including Counterfeit Parts Prevention, government source inspection or other US government DFARS.
RIGHT OF ENTRY: If required by US government contract, supplier will comply with the right of access by Neuro Logic Systems, our customer and/or regulatory authorities to the applicable areas and all applicable records of all facilities, and those of your sub-tiers involved in the fulfillment of this order and applicable records to ensure compliance with all applicable specifications and laws.
NLS PROPERTY: Subcontractors will handle NLS property carefully, and return it to NLS without any defects in appearance or performance.
ENVIRONMENTAL POLICY: NLS believes it has an important duty to ensure good environmental performance in all its business operations and to provide the necessary commitment and training to fulfil this obligation. We expect our suppliers to share in this commitment to monitoring and improving environmental performance, pollution prevention and environmental protection, and to expect the same throughout their supply chain.
CONFLICT MINERALS POLICY: NLS supports our customers in their obligations of the Dodd-Frank Wall Street Reform and Consumer protection Act Section 1502 pertaining to conflict minerals disclosure regulations. We rely on suppliers to provide information on their supply sources, and comply with customers’ requests to disclose information they may need to meet their own reporting obligations.
FOREIGN MATERIAL SOURCE: Raw material may only be procured from known and reliable sources in countries listed on the Bilateral Airworthiness Agreement (BAA) to ensure no counterfeit materials or conflict minerals enter the supply chain.
COMBATING TRAFFICKING IN PERSONS POLICY: The US Government requires all suppliers and their subcontractors to prohibit their employees from engaging in trafficking of persons in any form: forced labor, procuring a commercial sex act, denying access to identity or immigration documents, fraudulent practices during recruitment. NLS and all our suppliers are obligated to report any suspected trafficking activities without reprisal.
COUNTERFEIT PARTS PREVENTION AND NOTIFICATION:
Due to the serious concerns about counterfeit parts getting into production lines, our military and commercial customers entrust us with procuring parts that meet the standards of AS5553 and DFARS 252.246-7007. You can find these requirements in full online.
- Acceptance of this Contract constitutes confirmation by the seller that it is the Original Equipment Manufacturer (OEM)/Original Component Manufacturer (OCM), or a franchised or authorized distributor of the OEM/OCM for the product herein procured.
- Seller represents and warrants that only new and authentic materials are used in products required to be delivered to NLS and that the work delivered contains no Counterfeit Parts.
- Seller shall only purchase authentic parts/components directly from the OEMs/OCMs or through the OEM’s/OCM’s authorized distributor. Seller must make available to NLS, at NLS’ request, OEM/OCM documentation that authenticates traceability of the components to that applicable OEM/OCM.
- Purchase of parts/components from Independent Distributors (brokers) is not authorized.
- Seller shall maintain a documented Counterfeit Parts Prevention system (policy, procedure, or other documented approach) that is consistent with industry standards, AS5553 as minimum, or DFARS 252.246-7007 including policies and procedures for training personnel, designing and maintaining systems to mitigate risks associated with parts obsolescence, making sourcing decisions, prioritizing mission critical and sensitive components, ensuring traceability of parts, developing lists of trusted and non-trusted suppliers, flowing down requirements to subcontractors, inspecting and testing parts, reporting and quarantining Suspect Counterfeit Electronic Parts and Counterfeit Electronic Parts, and taking corrective action.
- Seller further warrants that OEM/OCM acquisition documentation that authenticates traceability of the components to that applicable OEM/OCM is available upon request. The seller shall retain source documentation as a quality record for 5 years.
- Seller shall flow the requirements of this provision to its subcontractors and suppliers at any tier for the performance of this Contract.
- Notifications: Should seller become aware of a Counterfeit Part or Suspect Counterfeit Part that, by any means, has been delivered to NLS, or acquired for this Contract whether or not delivered to NLS, seller shall notify NLS as soon as possible but not later than 7 days of discovery. Seller will verify receipt of this notification by NLS. This requirement will survive this Contract.
- Seller shall be liable for cost of Counterfeit Parts and Suspect Counterfeit Parts and the cost of rework or corrective action that may be required to remedy the use or inclusion of such parts.
- Seller shall quarantine Suspect Counterfeit Electronic Parts and Counterfeit Electronic Parts, and make them available for investigation by appropriate government authorities. Suspect Counterfeit Electronic Parts and Counterfeit Electronic Parts shall not be returned to the supply chain unless and until such time that the parts are determined to be authentic.