Navistar,Inc.
2701 Navistar Drive Lisle,IL60532 USA
P: 331-332--5000
W :
STANDARD TERMSAND CONDITIONS
1.CONTRACT. ForpurposesoftheseStandardTermsandConditions,theterm“Contract”shallmeanaComprehensiveSupplyAgreement,WarrantyAgreement,StandardTermsandConditions,andPurchaseOrders. IntheeventofaconflictbetweenthedocumentswhichconstitutetheContract,thedocumentsshallgovernintheordertheyarementionedaboveunlessotherwiseexpresslystatedinaspecificdocument.NotermsorconditionssubmittedbySupplierapplytoaContractunlessacceptedin writingbyNavistar.SuppliershallbedeemedtohaveacceptedtheContractattheearlierof(i)SuppliernotifyingNavistarofitsacceptanceor(ii)SupplierbeginningperformancepursuanttotheContract.
PRODUCT
2.PRODUCTS. Theterm“ProductionProducts”referstoproductsusedonlyforproductionandtheterm“ServiceParts”referstoproductsusedonlyforservice.Theterm“Products”includesServiceParts andProductionProducts,packaging,andcontainers,aswellasanyliteraturepertainingtosuchProducts.
3.THIRDPARTYDESIGNEE. Supplierwillalso,atNavistar’ssoleoption,sellProductstoNavistar’ssubsidiaries,affiliates,thirdpartycontractorsoranyotherNavistar-designatedparty(“ThirdPartyDesignee”),underthesametermsandconditionsassetforthinthisContract.AllofSupplier’srepresentations,warranties,andobligationsunderthisContractapplytosalestoThirdPartyDesignees.
4.PAYMENT. Standardpaymenttermsaresixty(60)daysfrom dateofreceiptofacorrectinvoicefrom Supplier,orthedateofreceiptoftheProductsbyNavistar,whicheverislater,unlessotherwiseagreedtoinwriting.NavistarneitherguaranteesnorisresponsibleforanyliabilitiesincurredbyanyThirdPartyDesigneesunderthisContract.
5.SPECIFICATIONCHANGES.NavistarreservestherightatanytimetomakechangesormodificationstodrawingsandspecificationsastoanyProducts,materials,orworkcoveredbythisContract. Thepartieswillagreeuponandequitablyadjustanydifferenceinpriceortimeforperformanceresultingfromsuchchanges,andmodifytheContractinwritingaccordingly.
6.SHIPMENT. ThetermsofdeliveryforallProductssoldpursuanttothisContractshallbeFCASupplier’sdock,unlessotherwisedesignatedbyNavistar.(Incoterms2010).
ShipmentsofProductsmustequaltheexactquantityorderedandrequesteddeliverydate,unlessotherwiseagreedtoinwriting.Intheeventofanover-shipment,Navistar,atitssoleoption,mayreturntheover-shipmenttoSupplieratSupplier’sexpense,includingNavistar’sadministrationfeeforhandlingtheover-shipment.
Supplier agrees to provide Navistar a return material authorization for over-shipments, and Supplier will not charge any restocking fees. Supplier agrees to comply with all requirements detailed in: the D-13 Supplier Packing and Shipping Standard; Navistar’s Quick Receive Guidelines that detail packing, packaging, labeling and shipping requirements; and Navistar’s Supplier Guidelines found at If Supplier at any time has reason to believe that deliveries will not be made as scheduled, Supplier must immediately notify Navistar in writing of the cause of the anticipated delay.
SupplieragreestocomplywithallrequirementslistedinthePR-38CustomsInvoicingInstructionsthatdetailscustoms,importandexportinstructionsandisfoundat SupplierwillprovideNavistarwithsuchadditionalinformationthatNavistarreasonablymayrequest,includedbutnotlimitedtoanyinformationabouttheProductsand/orSupplierthatNavistarmayneedtoprovideauthoritiesfortheimportorexportoftheProducts.
7.LEAD-TIME.Supplierwillmeetalead-timeofnomorethanfour weeksforProductsunless otherwiseagreedtoinwriting.SupplierwillregisteratNavistar’siSupplierPortalfoundat
8.VOLUMES.SupplierandNavistaragreethatNavistar’sforecastedvolumesarebasedonpastusageandprojectedmarketforecasts.ThePartiesagreethatnominimumpurchasequantitiesareimpliedbyanytermofthisAgreement,andnopenaltiesorliabilitiesshallbeimposedonNavistarforvolumesofProductsactuallyorderedbyNavistarbelowthosequantitiesforecasted.
9.PRICINGANDINVOICING. ThepriceforProductsisstatedinthePurchaseOrderandwillbeafixedprice.Duties,levies,feesandtaxesareaccordingtotheIncotermssetforthinSection6ofthisContract,unlessotherwiseagreedtoinwriting.AllagreeduponpriceadjustmentsmustalsobereflectedintheexportinvoicespreparedforCustomspurposes,ifapplicable.
Supplierwillprovideacostbreakdown(includingbutnotlimitedtolabor,material,andoverhead)andthepriceofallthebasiccomponentsofanyProduct,whichintheaggregatewillnotexceedthepriceoftheProductittogetherconstitutes.
SupplierandNavistarwilljointlypursuecostreductionopportunitiesforthedurationofthisContractandwillreflecttheachievementofsuchopportunitiesinpricereductionstoNavistar.
WithoutlimitingNavistar'sotherrightsandremedies,NavistarmaydeductfromanypaymentsduetoSupplier theamountofanyclaimswhichNavistarmayhaveagainstSupplier.
IncaseofanydisputeregardingthisContract,SupplieragreestocontinuetoshipProductsforreasonablelengthoftime,butnolessthan180daysfollowingsuchwrittennoticeofadispute,inordertogiveSupplierandNavistartheopportunitytoresolvethedispute.
Supplier mustidentifyalldisputeswithNavistarinwritingwithinsix(6)monthsofthedateofNavistar’sreceiptofSupplier’sshipmentinvolvedwiththedispute.IfSupplierhasnotidentifiedadisputetoNavistarin writingwithinthistime,Navistarwillnotbeliableforpayment.
10.TOOLING. IntheabsenceofanexecutedToolingandBailmentAgreement,thefollowingtermsapply:ToolingreferredtoinaToolingPurchaseOrderissuedbyNavistarisownedbyNavistaruponcompletionof
paymentforsuchtooling.IntheeventNavistar-ownedToolingistransferredtoSupplier’sfacilityorcontrol,such
ToolingwillremainthepropertyofNavistar.
SuppliermaynotissueaninvoicetoNavistarforToolinguntilsuchProducthasbeenthroughtheProductionPartApprovalProcess(PPAP)byNavistarunlessotherwiseagreedtoinwriting.
Supplieragrees,uponreceivingtheTooling,topromptlyaffix,andtocontinuouslykeepandmaintain,plainlyanddistinctly,permanentlyandconspicuouslyupontheToolingthefollowingwords:“PropertyofNavistar,Inc.”andtokeeptheToolingfreefromother“Propertyof”markingsorlabelingwhichmightbeinterpretedasaclaimofownershipbyapartyotherthanNavistar.Inaddition,withinninety(90)daysofreceivinganyTooling,SuppliershallaffixtoittheNavistarToolingIdentificationNumber.
SupplieragreestousetheToolingforthesoleandexclusivebenefitofNavistarintheproductionoftheProductsforNavistar,andfornootherpurposewithoutNavistar’spriorwrittenconsent;whichconsentmaybewithheldatNavistar’ssolediscretion.SupplieragreestooperatetheToolingwithinitsratedcapacity,restricttheuseandoperationtosafe,carefulpersonnelselectedandemployedorcontrolledbySupplier,andprohibitanyoneother thandulyauthorizedpersonnelofSuppliertomakeanyrepairsoradjustmentstotheToolingotherwisepermittedhereunder(unlessotherwisepreviouslyauthorizedinwritingbyNavistar).
AftertheinitialPPAPfortheProduct,oranysimilarprocess,Supplieragrees,atitsexpense,toservice,maintainandrepairtheTooling:(i)soastokeepitingoodoperatingcondition,normaltooling wearisexpected,(ii)inaccordancewiththetermsofanymanufacturers’warranties,specifications,bulletinsorservicedescriptions,(iii)inamannerconsistentwithstandardindustrypracticeandNavistar’spracticeandinstructions,and(iv)inaccordancewithapplicablelaws,regulations,governmentalapprovalsandpermits.SupplierwillnotberequiredtoperformanyCapitalImprovements(asdefinedbelow)totheTooling.“CapitalImprovements”shallmean(a)thepurchaseofadditionalmachinery,equipmentand/ortoolingwhichisrequiredforanewproductline,increasingcapacity,a designchange,oracostreductionproject,and(b)thecosttorebuildoroverhaultheToolingwhichmateriallyincreasesitsvalueorexpectedusefullife.TotheextentNavistar wishestoperformCapitalImprovements, however,Suppliershallcooperateandwork withNavistar,orwithanycontractorsusedbyNavistar,sothatNavistarmaymakeanysuchCapitalImprovementthatitdeemsnecessaryinitssolediscretion.
ToolingwillbefreeofalladvertisingorinsigniaplacedthereonbySupplier,andfreeandclearofallmortgages,liens,securityinterests,charges,encumbrances,andclaimsandinthesameoperatingorder,repair,condition,andappearanceas whenreceived(exceptforordinaryandexpectedwear).SupplierwillbesolelyresponsibletoNavistarforanydamagetoorlossoftheTooling,exceptanydamageorlosscreatedbyNavistaroragentsthereof,untilithasbeenreturnedtoNavistar.
Toolingmaynotberemoved,destroyedorscrappedwithoutNavistar’spriorwrittenconsent,whichcanbewithheldatNavistar’ssolediscretion.Toolingthatisthesubjectofintellectualpropertyright(s)mayfurthermorenotbecopiedwithouttheconsentoftheownerofsuchintellectualpropertyright(s).TotheextentanyintellectualpropertyrightsownedbySupplierorlicensedtoSupplierbyathirdpartyisembodiedin,orisotherwisenecessaryfortheintendeduseoftheTooling,SupplierherebygrantstoNavistarafullypaid,irrevocable,non-exclusive,worldwide,perpetualtotheextentpermittedbylaw,royalty-freelicense,withtherighttograntsublicensesasnecessaryfor anyuseofTooling,tousesuchintellectualpropertyrights.
UponNavistar’srequest,SupplierwillreturnallTooling,drawingsandothermaterialstoNavistar.
11.ENGINEERINGSPECIFICATIONANDPRODUCTSCOMPLIANCE.SuppliermustassurethatProductscomplywiththemostcurrentcontrolledrevisionsofNavistar’sCorporateMaterialPartandProcessSpecifications(“MPAPS”),Corporate EngineeringMaterial Specifications(“CEMS”),TruckMaterialSpecifications(“TMS”), EngineMaterialSpecifications(“EMS”),orEngineering Standard Parts(“ESP”) asdefinedinStatements ofWork(“SOW”),specificationtransmittals,prints,models,andmathdata.Suppliermustmaintaindesignsthroughoutthefifteen-yearservicelifeofallProducts.IfSupplierisprovidinganassemblyofcomponentsandthosecomponentsaremanufactured byanotherparty, the Supplierneedstoprovide documentation showingthat those componentsmeetthe specificationsandrequirementsascalledoutonthe2Dprintor3Dmathdata.IfSupplier providesengineeredsystemsandcomponents,SuppliermustprovideengineeringdataintheformofsolidmodelsinUnigraphicscompatibleformat,on-siteengineersduringtheProductDevelopmentProcessifrequestedbyNavistar’sengineering,prototype partsdevelopmentcapability,andthecapabilityforanduseofelectronic dataexchangeforengineeringandCADdatathroughoutthelifeofthedevelopmentprogramandforproductionmaintenance.IfSupplierprovidescommodities,SuppliermustprovideengineeringdataaseitherCADdataordrawings.Navistarwill designateathird partyfirmtobethesolesource forcontrolledcopiesofthe foregoingdocumentsandSupplierisresponsible forensuringthatitobtainscontrolledcopiesforthedurationofthetermofthisAgreementin ordertoassurecompliancewiththemostcurrentdocuments.
12.REGULATORYCOMPLIANCE.ForProductsorsystemspurchasedfromSupplierthathavespecificgovernmentregulatoryperformancerequirements,Suppliermustprovideevidenceofcompliance,intheformofatestreportand/orengineeringanalysis,validatingconformancetothosespecificregulatoryrequirements.SuppliermustprovidethesameevidenceofcompliancewheneverachangeismadetoaparticularProductorsystemthataffectstheperformanceofthatProductorsystemtoaspecificgovernmentregulatoryperformancerequirement. SuppliermustcompletealetterofconformanceandprovidetoNavistarasrequested.
13.INSPECTIONOFPRODUCTS.AllProductswillbereceivedsubjecttoNavistar’sinspectionorrejection.DefectiveProductsorProductsnotinaccordancewithNavistar’sspecificationswillbeheldforSupplier’sinstructionsandatSupplier’srisk,and,ifSuppliersodirects,suchProductswillbereturnedatSupplier’sexpense. Paymentfor
Productspriortoinspectionwillnotconstituteanacceptancethereof.ReturnedProductswillbedeductedfromtotalshipments.
SUPPLIERPERFORMANCE
14.SUPPLYFAILURE.Intheeventofafull orpartialfailureofSupplier’ssourcesofsupplyorcapacityconstraintsfortheProducts,SupplierwillfirstmeetallofNavistar’srequirementshereunderpriortoanyallocationamongcustomersunderSection2-615oftheUniformCommercialCode.
15.LATEDELIVERYCHARGES.IfNavistardeterminesthatSupplier’sdeliveriesaresofarbehindagivenschedulethatNavistarrequiresexpressshipments,thenSupplier willpaytheexpresscharges. IfSupplier’sdeliveriesaresofarbehindagivenschedulethatNavistariscompelledtousematerialnotaccordingtoNavistar’sspecification,oratahighercost,thenSupplierwillpaywhateveradditionalcosts,expenses,losses,ordamagesthatNavistarsustains. TheprovisionsofthisSectionarenotintendedtolimitanyotherrightsandremediesthatNavistarmayhaveagainstSupplier.
16.WARRANTY. Supplier warrants the Products against all defects in material, workmanship, and assembly, and design (if a Supplier-responsible design.) In addition, failures with no detectable defect found are expected to be shared between Navistar and Supplier by mutual agreement.
Supplier will compensate Navistar for any loss or damage arising out of or relating to a defective Product or other breach of this Warranty, including but not limited to costs (including reasonable attorneys’ and experts’ fees) for any safety recall or field actions, labor, replacement, assembly and disassembly, detection and analysis, scrapping, and transportation of replacement Product to Navistar and/or its end-users. Supplier agrees to utilize Navistar’s claim portal to review and respond to all warranty claims.
17.ACCESSTOPREMISES.Navistarwillhaveaccess,afterreasonablenotification,toinspectSupplier'sproductionofaProductorTooling,verifyanychargessubsequenttopayment,performtestsandmakeothernecessaryexaminationsatSupplier'spremises,includingevaluatinganyrisksforinterruptioninthesupplyofProducts.SupplierwillusereasonableeffortstoobtainthesamerightsforNavistaratthepremisesofitssuppliers.
18.DUTY REDUCTION PROGRAM DOCUMENTATION. Supplier shall provide annually to Navistar, as promptly as practicable after Navistar’s written request, an accurate and complete North American Free Trade Agreement (“NAFTA”) Certificate of Origin for those Products and parts that qualify for NAFTA. For any parts sourced outside of North America, to be sold to Navistar in the imported form, supplier to provide an affidavit of origin for all parts and products by Navistar’s part number. The NAFTA Certificate of Origin shall be completed in accordance with regulations published by the U.S. Dept. of Treasury in CFR Sec. 181.11 et. Seq. and any amendments thereto, and in accordance with Navistar’s NAFTA policy in the Customs Invoicing instructions (Buyer document PR-38) available on Navistar’s supplier website ( In addition to the NAFTA Certificates of Origin or Country of Origin Affidavits described above, Supplier shall provide to Navistar any supplemental part content, including “Traced Value,” (as defined in Treasury in CFR Sec. 181.11 et. Seq. and any amendments thereto), and functionality information reasonably requested by Navistar. Furthermore, supplier commits to maintain production and the supply-base of parts essential to qualification within North America, such that NAFTA certification is ensured throughout life of the agreement.
19.MANUFACTURINGLOCATIONORPROCESSCHANGE.SuppliermaynotrelocatetheproductionofaProductorchangetheprocesstoproducesaidProduct,whollyorpartly(Includingfinalortieredcomponents),withoutNavistar’spriorwrittenconsent,whichconsentmaybewithheldatNavistar’ssolediscretion.SuppliermustusetheNavistarSupplierRequestforEngineeringApproval(SREA)FormtorequestNavistar’sconsenttoa changeinlocationandcompletePPAPapprovalforallchangesasidentifiedintheAIAGPPAPmanual.ProductsproducedbySuppliermustalwaysbeproducedbyaproductionprocessapprovedbyaPartSubmissionWarrant(PSW)orDeviation.Suppliermaynotship,andwillnotbepaidforProductshippedwithoutanapprovedPSWorDeviation.Suchconsent,ifgiven,iswithoutprejudicetoNavistar’scontinuedrightstorequirecompliancebySupplierwiththeContract.IftheContractwillbefulfilledbyanotherentityotherthanSupplier,Suppliershall ensurethatsuchotherentityagreestobeboundbyalltermsandconditionsintheContract andnamesNavistarasathirdpartybeneficiaryinwriting.Suppliershall,however,alsocontinuetoberesponsibleforthefulfilmentoftheContract.
20.QUALITY. Unless specifically exempted by Navistar, Supplier is required to be registered to, compliant with, or working towards, ISO 9001, or a quality management system such as TS 16949. If Supplier is currently registered, then Supplier must maintain its certification with an accredited registrar and must furnish copies of its registration certificates to Navistar. If Supplier is compliant to ISO 9001, but not certified by a recognized third party registrar, Supplier agrees to provide evidence of such compliance to Navistar. If Supplier is working towards its quality registration, then Supplier must provide, upon Navistar’s request, evidence of such efforts and, upon receipt of its registration certification, inform Navistar and furnish copies of its registration certificates.Navistar reserves the right to schedule and conduct a Navistar Supplier Assessment (NSA) at any time. Regardless of quality systems registration status, suppliers are required to be capable of fulfilling all Navistar Integrated Supplier Quality Requirements as noted in the Integrated Supplier Quality and Supplier Guidelines / Terms and Conditions sections on Direct suppliers are required to cascade these requirements to lower tiered suppliers throughout the supply chain, a practice often referred to as “flowdown.” All documents that are created for review as part of PPAP approval must be submitted in English language, or the local language with English in parenthesis.
21.ELECTRONICDATAINTERCHANGE(EDI).SupplieragreestocomplywithallEDIrequirementsofNavistaraspostedon IfSupplierisunabletomeetalltheimplementationrequirements,thentheContractissubjecttoeitherterminationbyNavistar,oradailyassessmentoffiftydollars(US$50),atNavistar’ssoleoption,untiltherequirementshavebeenmet.SupplieragreesthatanyEDIwillbedeemedsufficientforenforceabilityunderanystate’sstatuteoffraudsorsimilarlaw. Supplier compliance with Navistar’s ASN (EDI 856, Advance Shipment Notification) requirements are mandatory. Valid ASN’s must be available for use by Navistar receiving personnel when Supplier shipments arrive at Navistar production plants and service parts distribution centers.
22.ASSURANCEOFPERFORMANCE.IfNavistarreasonablydeemsitselfinsecurewithrespecttoSupplier’songoingperformance,whetherduetoSupplier’sfinancialcapacityorotherwise,NavistarmaydemandthatSupplierprovideassuranceoffutureperformancetoNavistarwithinfive(5)daysofthedemand.ThisassurancemaybeinanysecurityacceptabletoNavistar,includingbutnotlimitedto,collateralconsistingofcash,letter(s)ofcredit,suretybond,parentguaranty,orlenderreleases.ThissecurityshallbeinanamountsatisfactorytoNavistar andshallalsobesufficienttooffsetcostsandexpensesincurredorreasonablyexpectedtobeincurredbyNavistarinsecuringforitselfcompletionoftheprojectorotherperformanceduefromSupplier.Navistarreservesitsrighttoanyotherremediesallowedinlaworequity.FailuretoprovidetherequestedperformanceassurancewithinthestatedperiodshallconstituteadefaultofthisAgreement,andNavistarshallbefreetoprocureProductfromanalternatesourceand/orcancelthisAgreementinitsdiscretionimmediatelyuponexpirationofthetimespecifiedfordeliveryoftherequestedperformanceassurance.
23.SUPPORT.SupplierwillprovideatnoadditionalcosttoNavistarsuchdesignanddesignqualificationassistance,manufacturingassistance,technical,serviceparts,andfieldsupportasreasonablyrequiredbyNavistar.
LEGAL/REGULATORY
24.SUPPLIERDIVERSITYPROGRAM. Supplieragreestoutilize“SmallBusinessConcerns,SmallDisadvantaged-OwnedBusiness Concerns, Minority-Owned Business Concerns,Women-Owned BusinessConcerns,Veteran-OwnedBusinessConcerns,ServiceDisabled-OwnedVeteranBusinessConcerns,andHUBzone-LocatedBusinessConcerns”asrequiredbyFederalLaws,97-507,99-661,100-656,103-355,
105-135and106-50.
Navistar’spolicystatesthatallsuppliersreceivingcontractsfromNavistarinexcessofsixhundredfiftythousanddollars(US$700,000),exceptsmallbusinessconcernsdefinedabove,willsetatwenty-threepercent(23%)minimumspendinggoaltofurthersubcontractwithSmallBusinessConcerns;will,inaddition,setafivepercent(5%)minimumspendinggoaltofurthersubcontractwithSmallDisadvantaged-OwnedBusinessConcerns;will,inaddition,setafivepercent(5%)minimumspendinggoaltofurthersubcontractwithMinority-OwnedBusinessConcerns;will,inaddition,setafivepercent(5%)minimumspendinggoaltofurthersubcontractwithWomen-OwnedBusinessConcerns;andwill,inaddition,setathreepercent(3%)minimumspendinggoaltofurthersubcontractwithVeteran-OwnedBusinessConcerns,ServiceDisabled-OwnedVeteranBusinessConcerns,andHUBzone-LocatedBusinessConcernscommensuratewithSupplier’ssalestoNavistar.SupplierfurtheragreestosubmitanannualwrittenplantoNavistarbyAugust31ofeachyearoutlininghowtheabovestatedgoalswillbeachieved. ReferenceisherebymadetotheSupplierDiversitysectionofNavistarSupplierNetwork(“NSN”)at
SupplieralsoagreestoreportitsaccomplishmenttowardtheabovegoalsonaquarterlybasisinNavistar’sReportingSystemasrequiredbyFARPart19.7. Navistaracknowledgesandagreesthat,forpurposesofsatisfyingtheforegoinggoals:(i)suchgoalsapplyonlytothosegoodsandservicespurchasedbySupplierintheUnitedStates;and(ii)apurchasesofgoodsandservicesmaybeentitledtocredittowardmorethanoneoftheforegoinggoalsdependingonthestatusofthesubcontractor—e.g.,asubcontractwitha“MinorityOwnedBusinessConcern”mayalsoqualifyasasubcontractwitha“SmallDisadvantaged-OwnedBusinessConcern”and/ora“Women-OwnedBusinessConcern.”
25.COMPLIANCEWITHLAWSANDREGULATIONS. SupplieragreesthatallProducts,materials,supplies,articles,orequipmenttobemanufacturedorfurnishedhereunderwillbeproducedincompliancewiththeFairLaborStandardsAct. IfthisContractexceedstenthousanddollars(US$10,000)andisotherwisesubjecttotheWalsh-HealeyPublicContractsAct,SupplieralsoagreesthatallProducts,materials,supplies,articles,orequipmenttobemanufacturedorfurnishedhereunderwillbeproducedincompliancewiththatAct.
26.GOVERNMENTALREQUIREMENTS. Supplieragreestocomplywithallapplicablestatutes,regulations,laws,andotherGovernmentrequirements,includingbutnotlimitedtothosereflectedincontractclausessetforthin48
C.F.R.Sections52.203-13(ContractorCodeofBusinessEthicsandConduct),52.219-8(UtilizationofSmall
BusinessConcerns),52.222-26(EqualOpportunity),52.222-35(EqualOpportunityforSpecialDisabledVeterans,VeteransoftheVietnamEra,andOtherEligibleVeterans),52.222-36(AffirmativeActionforWorkerswithDisabilities),52.222-39(NotificationofEmployeeRightsConcerningPaymentofUnionDuesorFees),52.222-41(ServiceContractActof1965)and52.247-64(PreferenceforPrivatelyOwnedU.S.-FlagCommercialVessels).Theterm“Contractor”andsimilartermsusedinsuchFARprovisionsshallbeconstruedtomeanSupplierforthepurposesofthisContract.
SomeProductsarecontrolledbytheInternationalTrafficinArmsRegulations(ITAR).ToensureNavistar’sandSupplier’scompliancewiththeITARandtoavoidtheimpositionofexportlicensingrequirements,SupplierwillensurethateachpersonwithaccesstoTechnicalData,asdefinedin22CFRSection120.10,DefenseServicesasdefinedin22CFRSection120.9,andDefenseArticlesasdefinedin22CFRSection120.6(collectively“ITARMaterials”)iseligibletobegrantedaccesstosuchITARMaterialspursuantto22CFRSection120.1(c)orisaU.S.Personasdefinedin22CFRSection120.15. Ininstances whereForeignPersons,asdefinedin22CFRSection120.16,haveaccesstoITARMaterials,SuppliershallimmediatelyprovideNavistarwithacopyofthelicenseorapprovalatthetimethatSupplierprovidessuchForeignPersonwithaccesstotheITARMaterials. ForthoseinstanceswhereSupplieremploys,retains,orcontractswithanyForeignPersonswithoutalicenseorapprovaldescribedabove,SuppliershallimmediatelynotifyNavistarand,ifrequested,provideNavistarwithadetailedexplanationofthestepsundertakentoensurethatthesepersonsarenotgainingaccesstotheITARMaterials.
Anyassetsand/ortechnicaldatacontrolledforexportperotherU.S.regulations,suchastheCommerceControlList,maynotbere-exportedwithoutNavistar’spriorwrittenconsent,whichconsentmaybewithheldatNavistar’ssolediscretion.
27.HUMANTRAFFICKING.BySupplierprovidinggoodsorservicestoNavistar,includingtoanyofNavistar’sThirdPartyDesignees,SupplierisaffirmativelyrepresentingandwarrantingthatSupplieranditssubcontractorsdonot,directlyorindirectly,engageinorotherwisesupportHumanTrafficking. HumanTraffickingisdefinedas:therecruitment,transportation,transfer,harboringorreceiptofpersons,bymeansofthethreatoruseofforceorotherformsofcoercion,abduction,fraud,deception,abuseofpowerorofapositionofvulnerabilityorofthegivingorreceivingofpaymentsorbenefitstoachievetheconsentofapersonhavingcontroloveranotherperson,forthepurposeofexploitation.
28.NORTH KOREAN LABOR. By Supplier providing goods or services to Navistar, including to any of Navistar’s Third Party Designees, Supplier is affirmatively representing and warranting that Supplier and its subcontractors do not directly, or indirectly, utilize the labor of North Korean nationals and/or North Korean citizens.
29.SAFETYDATACOMPLIANCE.Supplierwillproperlyclassify,describe,package,mark,label,andprovidematerialsafetydatasheets(MSDS)orsafetydatasheets(SDS),asapplicable,forapprovalbyNavistarpriortoshipmentofallProducts. SupplierwillprepareallsuchProductsfortransportation,accompaniedbytheapprovedMSDSorSDS,inaccordancewithallapplicablelocal,state,andfederallaws,ordinances,orregulations. Supplierwilldefend,indemnify,andholdharmlessNavistarfromanyclaims,penalties,ordamagesincurredbyNavistarasaresultofanyProductsreceivedfromSuppliernotinaccordanceherewith.
30.NON-DISCRIMINATION. Unless exempt, Supplier shall abide by the requirements of 41 CFR §§ 60-1.4(a), 60 300.5(a) and 60-741.5(a). These regulations prohibit discrimination against qualified individuals based on their status as protected veterans or individuals with disabilities, and prohibit discrimination against all individuals based on their race, color, religion, sex, sexual orientation, gender identification or national origin. Moreover, these regulations require that covered prime contractors and subcontractors take affirmative action to employ and advance in employment individuals without regard to race, color, religion, sex, sexual orientation, gender identification, national origin, protected veteran status or disability. If applicable, Supplier shall also abide by the requirements 41 CFR § 61-300.10 regarding veterans’ employment reports and 29 CFR Part 471, Appendix A to Subpart A regarding posting a notice of employee rights.Supplier agrees to (1) obtain an identical certification from proposed subcontractors prior to the award of subcontracts exceeding ten thousand dollars (US$10,000) which are not exempt from the provisions of the Equal Opportunity clause, and (2) maintain such certifications in its files.The penalty for making a false representation is prescribed under 18 U.S.C. § 1001, and any such false representation shall be a material breach of this Contract.
31.VETERANS’READJUSTMENTASSISTANCEACT.SupplieragreestocomplywithSection505oftheRehabilitationAct,theVietnamEraVeterans’ReadjustmentAssistanceAct(53U.S.C.§2012),andimplementingregulationssetforthbytheSecretaryofLaborasareapplicable.
32.CONFLICTMINERALS.Supplierrecognizes,consistentwiththepublicpolicyunderlyingenactmentoftheConflictMineralsprovision(Section1502)oftheDodd-FrankWallStreetReformandConsumerProtectionAct(the“Act”),thesignificantlegalandnon-legalrisksassociatedwithsourcingtin,tantalum,tungstenandgold(the“ConflictMinerals”)fromtheDemocraticRepublicoftheCongoandadjoiningcountries(“DRCCountries”).Accordingly,SuppliercommitstocomplywithSection1502oftheActanditsimplementingregulations. Inparticular,Suppliercommitstohaveinplaceasupplychainpolicyandprocesstoundertake(1)areasonableinquiryintothecountryoforiginofConflictMinerals incorporatedintoproductsitprovidesNavistar,(2)duediligenceofitssupplychain,asnecessary,todetermineifConflictMineralssourcedfromtheDRCcountriesdirectlyorindirectlysupportunlawfulconflictthere,and(3)riskassessmentandmitigationactions necessarytoimplementthecountryoforigininquiryandduediligenceprocedures.Supplierfurtheragrees(1)torespondpromptlytoeachinquirybyNavistarwithsuchinformationregardingthesourceandchainofcustodyofallConflictMineralsthatmaybecontainedinProductssuppliedtoNavistarbySupplier;(2)ifSupplierpreviouslyrespondedtoaninquirytonotifyNavistarifthereisachangeinstatusinwhetherSupplier’sProductssuppliedtoNavistarcontainConflictMinerals;and(3)tocooperatepromptlyasrequiredbyNavistarwithNavistareffortstocomplywiththeAct.SuppliershalltakeallothermeasuresasarenecessarytocomplywiththeActanditsimplementingregulations,astheymaybeamendedovertime.
33.INDEMNIFICATION.Supplieragreestoprotect,defend,holdharmless,andindemnifyNavistaragainstallclaims,actions,liabilities,losses,costs,andexpenses,including,withoutlimitation,reasonablelegalcostandfees,punitivedamages,consequentialdamages,andpenaltiesarisingoutofanyactualorallegeddeathof,orinjuryto,anypersonand/ordamagetoanyproperty,bywhosoeversuffered,resultingorclaimedtoresult,inwholeorin part,fromanyactualorallegeddefectinthesuppliedProducts,includingactualorallegedimproperdesign(unlesssolelyNavistardesigned),manufacture,orassemblyofsuchProducts,orarisingoutofanyactualorallegedviolationbySupplierwithregardtosuchProducts,ortheirmanufacture,possession,useorsale,ofanylaw, statute,orordinance,oranygovernmentaladministrativeorder,rule,orregulation.
34.INTELLECTUALPROPERTYINDEMNIFICATION. SupplierisresponsibleforensuringthattheProductoritsusedoesnotinfringetheIntellectualPropertyRightsofanythirdparty.Supplieragreestodefend,atitsexpense,anyclaimorsuitagainstNavistarorNavistar’scustomers,oranyoftheirofficers,directors,employees,agents,andaffiliatesbased onanassertionorclaimthattheProductsfurnishedbySuppliertoNavistarhereunderorthesaleortheusebyNavistaroritscustomersinthemannercontemplatedbythisContractinfringesanypatentorcopyright orotherintellectualpropertyrightorisawrongfuluseofathirdpartytradesecretorproprietaryinformation,andfurtheragreesto indemnifyandholdNavistar,oritsofficers,directors,employees,agents,andaffiliatesharmlessfromanylosses,includingattorneys’fees,settlementsassociatedwithsaidclaim,oranydamages,includingattorneys’feesorcosts,finallyawardedinanysuchclaim.IftheuseorsaleoftheProductsfurnishedpursuanttotheContractisenjoinedasaresultofsuchsuit,Supplier,atitsoptionandatnoexpensetoNavistar,shallobtainforNavistaranditscustomerstherighttouseandselltheProductorshallsubstituteanequivalentProductacceptabletoNavistarandextendthisindemnitythereto.Suppliershall,atNavistar'srequest,assistNavistarindisputesinwhichNavistarcouldbecomeinvolvedbyreasonofsuchinfringementandifrequiredbyNavistarassumethedefenseofanydispute.Thisindemnitydoesnotextendtoanyinfringementorallegedinfringementarisingsolely
outofSupplier’scompliancewithNavistar-requiredspecifications,designs,orinstructionsthat(i)arecreatedsolelybyNavistar,and(ii)arethereafterfurnishedtoSupplierinwriting.
SuppliermayusetheIntellectualPropertyRightsofNavistarandNavistaraffiliatesandsubsidiaries,whethersuchIntellectualPropertyRightsareinProductsorinTooling,fortheproductionandsupplyofProductstoonlyNavistar,Navistaraffiliatesandsubsidiaries,orThirdPartyDesignees(asagreedtobyNavistar)andmaynotusesuchIntellectualPropertyRightsfortheproductionand/orsupplyofanygoodsorservicestoanyotherparty.IfNavistaroraNavistaraffiliateorsubsidiarypays,orotherwisecompensates,Supplierfordevelopmentordesignwork,initiatedbyNavistar,forProductsorTooling,anyIntellectualPropertyRightsarisingfromsuchworkshallbeownedbyNavistar.TotheextentthatanysuchdevelopmentordesignworkincludesSupplierownedPre-existingIntellectualProperty,thenNavistar,andNavistar’scustomersshallhaveapaiduproyaltyfreelicensetouseor haveusedsuchPre-existingIntellectualProperty.SuppliershallnotuseanycorporatenameortrademarksbelongingtoorlicensedtoNavistaroritsNavistaraffiliatesorsubsidiariesotherthanasinstructedbyNavistarinwriting.
35.CONFIDENTIALINFORMATION. Supplieragreesnottodisclosetoanythirdparty,oruse,exceptas necessaryinconnectionwiththefurnishingoftheProductsorserviceunderthisContract,anyconfidential informationrelatingtoNavistar’sbusiness,includingbusinessandmarketingplans,processes,products,equipment,ortradesecrets,aswellasconfidentialinformationresultingfrom theperformanceofthisContract. AnyinformationnotavailabletothepublicshallbeconsideredconfidentialforthepurposesofthisContractforthedurationoftheContractandforten(10)yearsthereafter.Theconfidentialityundertakingoutlinedaboveshallnotapplytoinformation whichis(i)knowntothepublicotherthanbybreachofthisContract,(ii)informationwhichSuppliercanshowwasinitspossessionbeforereceivingitfromNavistar,and(iii)informationwhichSupplierreceivesfromathirdpartywithoutrestraintsastothedisclosurethereof.
InformationwhichSupplierisrequiredtodisclosebyreasonoflawororderofacourtofacompetentjurisdictionmayhoweverbedisclosedforsuchpurpose.SuppliershallnotifyNavistarofanysuchrequirementandconsultwithNavistarregardingthemannerofsuchdisclosure.Supplier,asfarasislegallypossible,shallrequirethereceiveroftheinformationtotreatitconfidentialasrequiredinthisSection.
SuppliermaynotmakepublicthebusinessrelationshipofthePartiesthroughadvertisingorinanyother waywithoutNavistar’spriorwrittenconsentfrom whichconsentmaybewithheldatNavistar’ssolediscretion.
IfthereisabreachofNavistar’sconfidentialinformationonSupplier’sdatasystem,SuppliershallimmediatelynotifyNavistarofthebreach,providethescopeofthebreach,andrestorethereasonableintegrity,security,andconfidentialityofthedatasystemthatcontainsNavistar’sconfidentialinformation.
36.OWNERSHIPOFMATERIALS. Allmaterials,includingwithoutlimitation,documents,drawings,models,sketches,designs,software,computertapesanddisks,andlistsfurnishedtoSupplierbyNavistarshallremainthepropertyofNavistarandshallbereturnedpromptlyuponcompletionoftheContractoratanytimeuponwrittenrequestofNavistar. SupplieragreesnottomakeanycopiesofanysuchmaterialswithoutNavistar’spermissionandtoreturnanycopiesauthorizedwiththeoriginalmaterials.
37.TERMINATION.Navistarshallhavetherightatanytime,andforanyreason,withoutanypenalty,toterminate,inwholeorinpart,thisContractorthedeliveriesspecifiedandtheauthorizationscontainedinanyshippingschedulegiventoSupplierbyNavistar,providedNavistarshallprovideSupplierthirty(30)days’noticeofsuchtermination,whereuponthisContractshallautomaticallyterminateimmediatelyafterthe30thday. UponsuchterminationbyNavistar,NavistarshallbeundernoliabilityorresponsibilitytoSupplierforProductscompletedorpartiallycompleted,orrawmaterialsacquiredbySupplierforthepurposeofperformingthisContract,unlessthedeliveryorfabricationofsuchProductsortheacquisitionofsuchrawmaterialswereauthorizedinpurchaseordersorshippingschedulesdeliveredtoSupplierbyNavistar.
38.RIGHTSANDREMEDIES.TheremediesprovidedintheContractwillbecumulativeand,exceptasexpresslylimitedintheContract,willnotprecludetheassertionorexerciseofanyotherrightsorremediesavailableunderlaw,inequity,orotherwise.Nomodificationsof,oradditionsto,theprovisionsorconditionsofthisContractwill
becomeapartofituntilacceptedinwritingbyNavistar.
39.CUSTOMS-TRADEPARTNERSHIPAGAINSTTERRORISM. Ifapplicable,SupplierwillparticipateintheCustoms-TradePartnershipAgainstTerrorismprogram(“C-TPAT”),orhaveadequatesecuritycontrolswhichmeetorexceedtherequirementsofC-TPAT.SupplieralsoagreestocompleteanyrequiredsupplychainsecuritysurveysrequestedbyNavistar.
MISCELLANEOUS
40.FORCEMAJEURE.NeitherNavistarnorSuppliershallberesponsiblefordelaysordefaultsduetocausesbeyondtheirrespectivecontrolandwithoutfaultornegligence.StrikesandlabordisputesshallnotbeconsideredForceMajeureevents.
41.SUPPLIERFINANCIALS.SuppliershallprovideNavistarwithSupplier’sfinancialinformationasrequested.
42.OBSOLESCENCEPOLICY.IfNavistarcancels,whollyorpartly,orfailstopurchaseaquantityofaProductforwhichNavistar'sorderisfirm,NavistarshallcompensateSupplierforreasonablecostsinaccordancewith Navistar’sobsolescencepolicy.
43.INVENTORYLEVELS.Supplierwillmaintainanadequateamountofinventoryonhandtosupporttheforecasteddemand.ForgoodsoriginatingfromoutsidetheNAFTARegion,Supplierwillmaintainatleastthirty(30)days’supplyofgoodswithintheNAFTARegiontosupportrequirementsunlessotherwiseagreedtoinwritingbyNavistar.
44.SERVICEPARTSANDUNITDOWN/CRITICALPURCHASEORDERSUPPORT. Navistar’scritical
purchaseorderisarequirementforaServicePartthatisneededimmediatelytosupportNavistar’sdistressedDealerorend-usercustomer. Supplieragreestoprovideuponreceiptofacriticalpurchaseordera“promisetoshipdate”responsewithinfour(4)hoursandagreestotargetServicePartsshipmentwithintwenty-four(24)hours.SupplierwillobtainanexcessfreightpremiumchargenumberfromNavistarandpriorapprovalforairfreightchargesexceptincasesof prepayandaddfreightterms. Supplierfurtheragreesthatnon-conformancetounitdown/criticalorderrequirementswillbesubjecttoaminimumchargetobedeterminedonacase-by-casebasis.
SupplierwillpriceProductionProductsandServicePartssimilarly,takingintoaccountpossibleadditionalcostsforServicePartspackaging.NavistarfurtherrequiresthatServicePartsbeavailableforatleastfifteen(15)yearsaftercessationofproduction. Unlessotherwiseagreedinwriting,Suppliershallfurnishatitsownexpense,keepingoodcondition,andreplacewhennecessary,alldies,tools,gauges,fixtures,andpatternsnecessaryfortheproductionoftheServicePartsordered. SupplieragreesnottoscrapServicePartspecificproductionequipmentsupportingNavistar’spost-productionServicePartsreplacementrequirementsofatleastfifteen(15)yearsaftercessationofproductionunlessithasreceivedthewrittenconsentofNavistar,regardlessofownership.
PricingforServicePartsshallbebaseduponthepriceineffectontheissuedateofthePurchaseOrderunlessotherwiseagreedtobyNavistarandSupplierpriortoshipment. ThepriceforServicePartsincurrentmodelproductionwillbecalculatedbaseduponthemostrecentapplicableproductionpriceplusthepriceactuallyincurredbySupplierforanyservice-specificpackaging. TheServicePartpriceshallbefixedforaperiodofatleastoneyearfrom theendofthemodelseriesproduction. Afterthefirstyear,themostrecentproductionpriceshallcontinuetoapplyuntilanewServicePartpriceismutuallyagreeduponbyNavistarandSupplier. SupplieragreestofullydocumentanyrequestforapriceadjustmenttoNavistar’ssatisfaction.
Supplier hereby agrees to provide Navistar’s service and aftermarket requirements for Products solely through Navistar Third Party Designees specifically identified by Navistar, and Supplier hereby agrees it will not provide such Products to International or IC Bus dealers, Third Party Designees, or Navistar’s customers, directly or through any alternate aftermarket distribution channel, unless Supplier has obtained prior written authorization from Navistar.
45.INSURANCE. Supplierwillpurchaseandmaintaincommercialgeneralliabilityinsuranceintheamountofatleastfivemilliondollars(US$5,000,000)andprovideNavistarwithaCertificateofInsuranceidentifyingNavistarasanadditionalinsured. FailuretoprovidesuchCertificateofInsuranceshallvoidthisContract,atNavistar’ssoleoption. Suppliershallcauseinsurerorinsurancebrokertoprovidethirty(30)dayswrittennoticetoNavistarpriortocancellationormaterialchangestothepolicies. Anysuchchange,modificationorcancellationshallnotaffectSupplier’sobligationtomaintaintheinsurancecoveragesetforthherein.
46.CODEOFCONDUCT. SupplieragreestoreadandcomplywithNavistar’sCodeofConductPolicy,whichissetforthat SupplieragreesnottoengageinanyactivitythatcouldcauseNavistaroranyofNavistar’semployeestoviolatetheNavistar’sCodeofConductPolicy.
47.NAVISTARIDENTITYREMOVAL.Atitsownexpense,SupplieragreestodestroyorremovetoNavistar’scompletesatisfaction,Navistar’scorporatename,addresses,trademarks,patentnumbers,andallotherreferencetoNavistarfromallProductsrejectedorcanceledbyNavistar,orpurchasedorproducedbySupplierinexcessofquantitiesspecifiedbyNavistar,whethersuchProductsarecompletedorpartiallycompleted,delivered,tenderedfordelivery,orundelivered,priortodispositionofsuchProductstopartiesotherthanNavistar;ortodestroysuchProducts.SupplieracknowledgesthatanysaleofProductsbearingNavistar’stradenameand/ortrademarkstoanypersonorentityotherthanNavistarorasauthorizedbyNavistarinwritingisaninfringementofNavistar’s proprietaryrightsinitstradenameand/ortrademarksandisanattemptbySupplierto“passoff”ProductsastheProductsofNavistar. SupplieragreesthatitshallnotinanymannermakeknownthefactthatSupplierhasfurnished,orcontractedtofurnish,toNavistartheProductscoveredbythisContract,orusethenameofNavistaroranyofitstrademarksortradenamesinSupplier’sadvertisingorotherpromotionalmaterialwithoutNavistar’spriorwrittenconsent,whichconsentmaybewithheldatNavistar’ssolediscretion.