The material portions of the Agreement between the Company and Bechtel National
Inc. regarding the Pueblo Chemical Agent Destruction Pilot Plant Project are set
forth below.    

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CONFIDENTIAL TREATMENT REQUESTED

SECTION 1 – SCOPE OF WORK AND NOTES

Bechtel National, Inc.
PURCHASE ORDER
Pueblo Chemical Agent – Destruction Pilot Plant
 SCOPE OF WORK AND PRICING

Item
No
Prev
Rev
Rev
Prev
Qty
Quantity
& Unit
Delta Qty
DESCRIPTION
Unit Price
Previous Extend
Delta Extend
Extended Value
[*]
[*]
[*]
[*]
[*]
[*]
[*]
[*]
[*]
[*]
[*]

[*]
Denotes Information for which confidential treatment has been
requested.  Confidential portions omitted have been filed separately with the
Securities & Exchange Commission.

 
There are 22 pages of line items and proprietary pricing information which have
been omitted and for which confidential treatment has been requested.  All 22
pages follow the exact format as indicated above.

 
 
 

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SECTION 1 – SCOPE OF WORK AND PRICING
COMMERCIAL NOTES

Bechtel National Inc.
Pueblo Chemical Agent Destruction Pilot Plant Project

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1. PRICING POLICY

Prices are firm and fixed through delivery and not subject to adjustment or
escalation.

 2. PAYMENT TERMS

Payment terms are in accordance with Section 4A General Conditions GC-5, “Price
and Payment

Drawings/Data (G321E) and Quality Verification Documentation (G321V) (Vendor
Data) in compliance with Section 3 are deliverables under the terms of payment.

Payment Withheld – Vendor Data.  If this PURCHASE ORDER requires the submittal
of Vendor Data, and if such Vendor Data, or any part thereof, is not delivered
within the time specified by this order, or is deficient upon delivery, BUYER
may, until such Vendor Data is delivered or deficiencies are corrected, without
limiting any of its other rights or remedies, withhold payments not to exceed
20% of the PURCHASE ORDER price to the SELLER.

 3. GENERAL AND SPECIAL CONDITIONS

BUYER’S General and Special Conditions and United States Government Flowdowns
according to Sections 4A, 4B and Appendix FOA-1 apply to this order without
exception.

 4. DRAWING AND DATA REQUIREMENTS

SELLER shall submit drawings and data for BUYER review per Section 3 - Drawing
and Data Requirements.

 5. SOURCE INSPECTION

The Products are subject to confirmation of strict compliance by BUYER's Source
Inspector and Acceptance at the Jobsite in accordance with Section 5. Deviations
from the requirements of this agreement may not be authorized. Should conflicts
or errors be noted please contact the undersigned immediately and prior to
accomplishing the work.

6.SHIPPING TERMS

FCA Jobsite, Pueblo, Colorado INCO terms 2000.  Seller to arrange
shipping.  Freight pre-paid and added to invoice.

 7. SELLER’S PROMISED SHIPMENTS

The SELLER’s Promised Ship Date(s) is (are)

Milestone
Lead Time Duration/Forecast Delivery Date
Drawing Submittals
8 weeks after receipt of order
Lead Time
36-66 weeks after receipt of order
Shipment
1-2 weeks

 
Within 24 hours of shipment, SELLER shall email or fax copies of the shipment
bill of lading (including pro number or tracking number) and packing list to the
Expediter.  These documents must also accompany the shipment.

Packing list must include as a minimum the Purchase Order number, BUYER’s
purchase order line item number for each item listed, number of pieces shipped
(loose pieces, boxes, crates or skids), and the net and gross weight of each
piece.

Purchase Order Number must appear on all invoices, correspondence, containers,
shipping papers and packing lists in each container.

Packing list must also include the BUYER’s shipment control number (SCN).

 
 

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8. ORIGIN OF SHIPMENT(S)

Pelham, AL

 9. SHIPPER(S)

CMS Field Products

10. TAGS  

As required by the technical specifications.  The cost for tags are included in
Line Item 8.002.

11. RELEASES

This PURCHASE ORDER is released for fabrication and subject to the terms of
Commercial Note 12 herein titled Obligation of Funds and any Quality Program
Restrictions that may be required by the BNI Supplier Quality Manager for
Contract DAAAA09-02-D-0025.

12. OBLIGATION OF FUNDS

The amount of funds obligated with respect to the work covered by Purchase Order
is $ 5,686,802.00 which represents 100% of the total award value. The amount of
the Obligation may be modified unilaterally by BUYER by written notice to the
SELLER and may be increased or decreased by revision to the Purchase Order in
accordance with the terms and conditions herein. If the amount of funds
obligated to this Purchase Order above paragraph is less than 100%, the SELLER
shall provide written notification to the BUYER when billable amounts are
expected to exceed 80% of the obligated funds no later than 60 days before the
80% level is reached.

The SELLER is authorized to apply the unit and lump sum rates of this Purchase
Order only to the extent of the release, per Paragraph herein titled Releases,
to quantities satisfactorily completed in accordance with the terms of this
Purchase Order.  Application of the unit or lump sum rates may be made only up
to an shall not exceed the individual numbered line item extended value as noted
in the original fully accepted Purchase Order and all fully accepted Purchase
Order Revisions.

The total extended values for each numbered line item, unless otherwise
specified herein, are the maximum liability for which BUYER.  shall be liable
for those individual numbered line items in the event this Purchase Order is
terminated. The SELLER will notify BUYER in writing whenever it has reason to
believe that the amounts incurred for each numbered line item, the sum of the
line items, less all payments previously made against those amounts, if any,
will in the event of termination for convenience, or otherwise, result in an
amount to be due from BUYER which exceeds the amount which has been obligated
herein.  Such notice shall, at a minimum, identify by numbered line item: 1)
cumulative amounts incurred or to be incurred; 2) payments made to date; and 3)
expected payments to the point of exceeding amounts obligated.

There will be no liability on the part of BUYER for any payment, termination
liability, or other Contractual requirement that may arise from performance
under this Purchase Order beyond the releases given and those Funds made
available and obligated to this Purchase Order.

13. DEFERRED DELIVERY

BUYER shall have the option of delaying shipment of any or all products up to 30
days beyond the dates stated herein at no cost.

14. EARNED PURCHASE ORDER VALUE

SELLER shall submit to BUYER each month an estimate of their physical progress
based on the earned total purchase order value, through the end of the reporting
period.  The reported progress should be inclusive of all subtier suppliers and
subcontractors.  Progress is to be expressed as a percentage of current total
purchase order value scope.  The estimate is to be provided to BUYER within five
days after the last Sunday of the month.

15. PROPRIETARY INFORMATION

This Purchase Order and all drawings, design, and specifications and other data
appended or related to it (if not furnished by SELLER) are the property of the
BUYER and are delivered for the purpose of enabling the SELLER to perform the
scope of work under this Purchase Order.  The Information contained or appended
to it is not to be disclosed or released for any other use or purpose without
prior written consent from the BUYER, and must be returned when requested.

 
 

 
 

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SECTION 4A – GENERAL CONDITIONS

COMMERCIAL ITEM

Bechtel National Inc.
Pueblo Chemical Agent Destruction Pilot Plant Project

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TABLE OF CONTENTS

GC
TITLE 
PAGE NO.
     
GC-1
DEFINITIONS
2
GC-2
ENTIRE AGREEMENT
2
GC-3
PURCHASE ORDER INTERPRETATION
2
GC-4
CHANGES
2
GC-5
PRICE AND PAYMENT
3
GC-6
DELIVERY
5
GC-7
TITLE AND RISK OF LOSS
6
GC-8
EXPEDITING
6
GC-9
QUALITY STANDARDS
6
GC-10
WARRANTIES AND GUARANTEES
7
GC-11
INFRINGEMENT
7
GC-12
COMPLIANCE
7
GC-13
ASSIGNMENT
8
GC-14
SUSPENSION
8
GC-15
TERMINATION FOR CONVENIENCE
8
GC-16
TERMINATION FOR DEFAULT
9
GC-17
DISPUTES
9
GC-18
NON-WAIVER
10
GC-19
COMPLIANCE WITH LAWS UNIQUE TO GOVERNMENTCONTRACTS
10
GC-20
APPLICABLE LAW
10
GC-21
REPRESENTATIONS AND CERTIFICATIONS
10
GC-22
SELLER TERMS AND CONDITIONS EXCLUDED
10
GC-23
UNITED STATES GOVERNMENT FLOW DOWN REQUIREMENTS
10
GC-24
RECORDS AND AUDIT
11

 

 
Page 1 of 11

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Bechtel National Inc
 
Pueblo Chemical Agent Destruction Pilot Plant Project
GENERAL CONDITIONS

GC-1      DEFINITIONS

"PURCHASE ORDER" means this agreement, including the General Conditions, all
attachments, appendices, sections, exhibits, schedules, and revisions hereto
(each of which is hereby incorporated herein by reference), as issued from time
to time.

"BECHTEL" means Bechtel National Inc.

"BUYER" means BECHTEL whether acting on its own behalf or as agent for OWNER.

“Government” means each and every branch of the government of the United States
and each department and agency thereunder.

“Jobsite” means Pueblo Chemical Agent Destruction Pilot Plant Project at the
Pueblo Chemical Depot located in Pueblo, CO.

“OWNER” means the Government and its authorized representatives and successors
in interest.

"PRODUCT" means the goods, materials, articles, equipment, supplies, drawings,
data, processes and all other property and services, including design,
expediting, inspection, delivery, installation, and testing, specified or
required to furnish the items ordered hereunder, which are required in the
performance of BUYER’S Prime Contract with the OWNER.

"Project” means Pueblo Chemical Agent Destruction Pilot Plant Project

“SELLER” means the company, corporation, partnership, individual, or other
entity to which this PURCHASE ORDER is issued, its authorized representatives,
successors, and permitted assigns.
 
GC-2      ENTIRE AGREEMENT

This Commercial Items Purchase Order (“PURCHASE ORDER”) embodies the entire
agreement between BUYER and SELLER.  The parties shall not be bound by or liable
for any statement, representation, promise or understanding not set forth
herein.  Nothing contained in proposals, correspondence, discussions, order
acknowledgments or other of SELLER’S forms has any effect on this PURCHASE ORDER
unless specifically incorporated herein.
 
GC-3      PURCHASE ORDER INTERPRETATION
 
All questions concerning interpretation or clarification of this PURCHASE ORDER
or applicable standards and codes, (including the discovery of conflicts,
discrepancies, errors or omissions) or the acceptable performance thereof by
SELLER, shall be immediately submitted in writing to BUYER for
resolution.   Subject to the provisions of the clause titled “CHANGES,” all
determinations, instructions and clarifications of BUYER shall be final and
conclusive unless determined to have been fraudulent or capricious, or
arbitrary, or so grossly erroneous as necessarily to imply bad faith, or not
subject to substantial evidence.
 
GC-4      CHANGES
 
(a)
BUYER, through its authorized procurement representative, may at any time
direct, in writing, changes, including but not limited to changes in any one or
more of the following:

 
Page 2 of 11

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Bechtel National Inc
 
Pueblo Chemical Agent Destruction Pilot Plant Project
GENERAL CONDITIONS

 

 
(1) drawings or specifications;
(2) additions to or deletions from quantities ordered;
(3) delivery schedule;
(4) method of shipment or packing; and
(5) place of delivery.
   
(b)
If any such change causes an increase or decrease in the cost of or timing
required to provide the PRODUCT(S), an equitable adjustment may be made in the
price or delivery schedule, or both, and the PURCHASE ORDER shall be modified by
written amendments or revisions executed by authorized representatives.  Any
request by the SELLER for adjustment under this Changes clause must be asserted
within thirty (30) days from the date of receipt by the SELLER of the
notification of change.  However, nothing in this clause shall excuse SELLER
from proceeding with the order as changed.

 
(c)
If this PURCHASE ORDER requires BUYER to review and comment on SELLER’S
technical documents, SELLER shall submit, within thirty (30) days from the date
of SELLER’S receipt of such comments, any request for adjustment which would
result from implementation of BUYER’S comments.  No adjustment will be made
hereunder unless BUYER, through its authorized procurement representative,
confirms the change in writing.

 
(d)
No modifications of these General Conditions shall be valid unless reduced to
writing and signed by both parties.

 
GC-5      PRICE AND PAYMENT
 
 (a)
The prices herein specified, unless otherwise expressly stated, shall exclude
all taxes and duties of any kind which either party is required to pay with
respect to the sale of PRODUCTS covered by this PURCHASE ORDER, but shall
include all charges and expenses in connection with the packing of the PRODUCTS
and their carriage to the place of delivery to the BUYER unless specifically
excluded.  SELLER shall be paid, except as otherwise stated in this PURCHASE
ORDER, upon submission of proper invoices, the prices stipulated herein for
PRODUCTS delivered and accepted; however, payment may be withheld or portions
thereof may be deducted if in BUYER’S reasonable opinion SELLER is not
performing in accordance with the provisions of this PURCHASE ORDER or if proper
set-offs in favor of BUYER in other transactions are asserted.  BUYER reserves
the right to make payments due hereunder directly to suppliers of SELLER
whenever BUYER has reason to believe SELLER has not paid or is likely not to pay
such suppliers amounts due them on a timely basis.

 
(b)
Options:  If options are authorized, the price for those options shall be in
accordance with the price identified in the PURCHASE ORDER at the time the
option is authorized.

 
(c)
The SELLER shall be notified if any price on the PURCHASE ORDER exceeds pricing
obtained through market analysis.  If, as a result of market analysis, the
SELLER price(s) appears to be unreasonable, immediate price discussions will be
conducted with the SELLER.  BUYER reserves the right to procure by other means
those items whose price exceeds market value based upon market analysis.

 
BUYER shall have the right to conduct an audit of the SELLER’S records to
validate SELLER’S price for discounted price items.  BUYER must provide the
SELLER written notice of the audit ten (10) business days prior to the audit.
 
(d)
Economic Price Adjustments

 
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Bechtel National Inc
 
Pueblo Chemical Agent Destruction Pilot Plant Project
GENERAL CONDITIONS

 
Adjustment to the fixed-price for goods or services under this PURCHASE ORDER
will be considered by BUYER as negotiated based on the PURCHASE ORDER schedule
and Progress Milestones and upon SELLER's certification that the proposed
adjustment is solely attributable to the effect of inflationary factors upon
SELLER's costs under this PURCHASE ORDER.  Specific inflationary impacts must be
significant enough to warrant an adjustment and must be detailed in a written
price adjustment request.  In no case shall the adjustment include profit.
 
 
i.
SELLER warrants that the prices in this PURCHASE ORDER do not include any
allowance for any contingency to cover increased costs for which adjustment is
provided under this clause.

 
 
ii.
Requests for price adjustments shall be subject to the following conditions:

 
 
a.
Option year price adjustments shall be submitted formally in writing 90 days
before the completion date of the PURCHASE ORDER.

 
 
b.
No unit price adjustment shall be requested unless the SELLER's item cost is
decreased or increased.  The SELLER is required to furnish written evidence
(subject to audit) to BUYER of the SELLER's cost changes.  Invoices and
manufacturers' distributor cost sheets will be considered such evidence.  The
distributor's cost sheet and/or invoice must be highlighted and submitted
consecutively as the items are listed in the PURCHASE ORDER.  Freight charges
and other miscellaneous costs will not be considered in cost increases.  An
acceptable format for submission of proposed price changes shall be as
follows:  Manuf., Part No., Old Cost, New Cost, Old Price, New Price (e.g.,
XYZ   001   $1.35   $1.55   $1.48  $1.68).  BUYER may cover the substantiated
increase in cost for firm fixed price items, however, SELLER's gross dollar
markup remains the same.  The price increase formula is as follows: (Old Price -
Old Cost) + New Cost = New Price

 
 
c.
BUYER must approve, in writing, any price adjustment.  All items on any PURCHASE
ORDER Releases shall be delivered to BUYER at the established PURCHASE ORDER
price in effect on the date of award of the Release by the BUYER, not the date
of product delivery by the SELLER.

 
 
d.
If SELLER's net prices to others, for like kind and quantity as those ordered by
BUYER, are reduced, or SELLER receives benefit of a price decrease from the
manufacturer, SELLER shall give BUYER a corresponding price
reduction(s).  SELLER shall reduce its price by the amount its purchase price is
reduced, i.e. the gross dollar markup shall remain the same.  SELLER shall
notify BUYER, in writing, promptly, not more than 30 days after being effected,
of the price reduction(s).  Price reductions will become effective upon BUYER's
issuance of a revision that revises the applicable firm-fixed unit prices.

 
 
e.
SELLER will, if requesting a price adjustment, identify all items where costs
have decreased.

 
 
f.
BUYER shall, until the expiration of three years after final payment of the
PURCHASE ORDER, have access to and the right to examine any directly pertinent
books, documents, papers and records of SELLER.

 
(e)
For items recommended by SELLER for addition to the PURCHASE ORDER, SELLER must
establish reasonableness of the proposed price(s) by furnishing the following
with each detailed

 
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Bechtel National Inc
 
Pueblo Chemical Agent Destruction Pilot Plant Project
GENERAL CONDITIONS

 
item description:  Copies of the current published price list(s) provided to the
SELLER's most favored customer purchasing the same item(s) in like or comparable
quantities or other documentation acceptable to BUYER, the manufacturer,
manufacturer's part number, and SELLER's stock number.  When requested, the
SELLER shall disclose to BUYER the amount of all price reductions of any kind
whatsoever such as trade discounts, cash discounts, and rebates applicable to
the item(s).
 
(f)
SELLER shall invoice BUYER not more frequently than the established invoice
date/term or for repetitious activities, not more frequently than once a month,
in accordance with the payment terms of this PURCHASE ORDER, based on goods
received by BUYER.  Credits resulting from returns, substitutions, or pricing
discrepancies discovered through audit will be deducted from any gross payment
due.

 
(g)
SELLER shall maintain at all times adequate cost records and accounts related to
this PURCHASE ORDER.  BUYER shall have the right to examine, with advance
notification, such records and accounts for the limited purpose of verifying
requests for payment when costs are the basis for such payment or for evaluating
the reasonableness of proposed price adjustment requests.

 
(h)
BUYER may, as a condition precedent to any payment, require SELLER to submit for
itself, its subcontractors, immediate and remote, and all material suppliers,
vendors, laborers and other parties acting through or under it, complete waivers
and releases of all claims against BUYER and Government arising under or by
virtue of this PURCHASE ORDER In addition, and upon BUYER’S request, SELLER
shall furnish acceptable evidence that all such claims have been satisfied.

 
(i)
Payment terms are net sixty (60) days from receipt and acceptance of the
PRODUCTS, including required submittals, and receipt of proper invoice,
whichever is later, subject to any limitations as provided elsewhere in this
PURCHASE ORDER.

 
(j)
If PURCHASE ORDER fulfillment is by a single shipment, SELLER shall submit an
original invoice and one (1) copy to BUYER at the time of shipment and any cash
discount period offered by SELLER shall be computed from the later date of
PRODUCTS and submittals receipt or BUYER'S receipt of a proper invoice.  The
foregoing payment and cash discount periods shall be extended by the period of
any delay caused by an error in the invoice requiring correction.

 
(k)
If PURCHASE ORDER fulfillment occurs by more than one shipment, SELLER shall
submit only one (1) invoice per month, after shipment is made.  Any cash
discount period offered by SELLER shall be computed from the date of BUYER'S
receipt of a proper invoice.

 
(l)
BUYER may elect to pay SELLER through BUYER’S electronic funds transfer (EFT)
process.  SELLER shall advise BUYER in writing within thirty (30) days prior to
the due date of SELLER’S first invoice of the bank and account number to which
EFT payments may be made to SELLER.

 
GC-6      DELIVERY
 
Timely performance and delivery in accordance with the schedule herein are
essential to this PURCHASE ORDER.  However, SELLER will not be liable for delays
in performing its obligations to the extent the delay is caused by an
unforeseeable condition which is beyond SELLER’S reasonable control without
SELLER’S fault or negligence.  Delays attributable to and within the control of
SELLER’S suppliers or subcontractors of any tier shall be deemed delays within
the control of SELLER.  Acts of God, such as storms or floods, as well as
government priorities, acts of civil or military authorities, fires, epidemics,
war or riot are examples of events which will be excusable for being beyond
SELLER’S reasonable control,

 
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Bechtel National Inc
 
Pueblo Chemical Agent Destruction Pilot Plant Project
GENERAL CONDITIONS

 
only upon fulfillment of the following conditions; (a) within seven (7) days of
the commencement of any excusable delay, SELLER shall provide BUYER with written
notice of the cause and extent thereof as well as a request for a schedule
extension for the estimated duration thereof; and (b) within seven (7) days of
the cessation of the event causing delay, SELLER shall provide BUYER with
written notice of actual delay incurred, upon receipt of which the date of
promised delivery shall be extended for the time actually lost by reason of an
excusable delay.
 
GC-7      TITLE AND RISK OF LOSS
 
Except as otherwise provided herein, all PRODUCTS furnished by SELLER hereunder
shall become the property of BUYER or OWNER, as applicable, upon payment
therefor or upon delivery, whichever occurs earlier.  Notwithstanding the
foregoing, SELLER shall be responsible for and shall bear any and all risk of
loss or damage to the PRODUCTS until delivery thereof in accordance with the
delivery provisions of this PURCHASE ORDER.  Upon such delivery, SELLER shall
cease to bear the risk of loss or damage; provided however, that any loss or
damage, whenever occurring, which results from SELLER’S nonconforming packaging
or crating shall be borne by SELLER.
 
GC-8      EXPEDITING
 
The PRODUCTS, including all warranty work, shall be subject to expediting by
BUYER.  BUYER’S representatives shall be afforded free access during working
hours to SELLER’S plants, and SELLER agrees to procure a similar right for
BUYER, for expediting purposes with respect to SELLER’S suppliers.  As required
by BUYER, SELLER shall supply schedules, progress reports and unpriced copies of
SELLER’S purchase orders and subcontracts for BUYER’S use in expediting.  SELLER
shall notify BUYER in writing of any actual or anticipated delays immediately
upon discovery.  Such notice shall include an estimated period of delay, cause,
and corrective actions being taken.  Slippage in SELLER’S schedule may be deemed
to be reasonable grounds for insecurity in which event BUYER may demand in
writing that SELLER provide adequate assurances that SELLER will perform on
time.
 
GC-9      QUALITY STANDARDS
 
(a)
SELLER shall ensure that the PRODUCTS comply with the standards of quality
specified by this PURCHASE ORDER or those customary in the industry if no
requirement is specified.  BUYER’S quality surveillance representative shall be
afforded free access during working hours to plants of SELLER and SELLER agrees
to procure a similar right for BUYER for quality surveillance purposes with
respect to SELLER’S suppliers in order to monitor compliance with quality
requirements.  BUYER’S right to inspect, examine, and test the PRODUCTS shall
extend through the manufacturing process, the time of shipment and a reasonable
time after arrival at the final destination.  SELLER’S failure to adhere to the
standards of quality required under this PURCHASE ORDER shall be deemed to be
reasonable grounds for insecurity.  BUYER may demand in writing, that SELLER
provide adequate assurances of SELLER’S ability to meet said standards.

 
(b)
The PRODUCTS shall not be deemed accepted until finally inspected and accepted
by BUYER’S representative at final destination.  The making or failure to make
an inspection, examination or test of, or payment for, or acceptance of the
PRODUCTS shall in no way relieve the SELLER from its obligation to conform to
all of the requirements of this PURCHASE ORDER and shall in no way impair
BUYER’S right to reject or revoke acceptance of nonconforming PRODUCTS, or to
avail itself of any other remedies to which BUYER may be entitled,
notwithstanding BUYER’S knowledge of the nonconformity, its substantiality or
the ease of its discovery.

 
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Bechtel National Inc
 
Pueblo Chemical Agent Destruction Pilot Plant Project
GENERAL CONDITIONS

 
 
GC-10 WARRANTIES AND GUARANTEES
 
(a)
SELLER warrants that the PRODUCTS shall be free from liens and from defects in
design, material, workmanship, and title, and shall conform in all respects to
the terms of this PURCHASE ORDER and to the applicable drawings issued for
manufacture, and shall be new and of the best quality, if no quality is
specified.  Unless the warranty period is otherwise specified in this PURCHASE
ORDER, the following warranty shall apply: if, any time prior to one (1) year
from the date of commercial operation of BUYER’S facility, or, with respect to
liens, title or latent defects at any time, it appears that the PRODUCTS, or any
part thereof, do not conform to these warranties, and BUYER so notifies SELLER
within the warranty period, SELLER shall promptly correct such nonconformity to
the satisfaction of the BUYER, at SELLER’S sole expense; failing which BUYER may
reject or revoke acceptance, and cover by making any reasonable purchase of
PRODUCTS in substitution for those rejected and the SELLER will be liable to the
BUYER for any additional costs for such substituted PRODUCTS; or BUYER may
proceed to correct SELLER’S nonconforming work by the most expeditious means
available, and the costs for such correction shall be for SELLER’S account; or
BUYER may retain the nonconforming PRODUCTS and an equitable adjustment reducing
the order price to reflect the diminished value of such nonconforming PRODUCTS
will be made by written revision.

 
(b)
SELLER’S liability hereunder shall extend to all damages proximately caused by
the breach of any of the foregoing warranties, including incidental damages,
such as disassembly, removal, inspection, re-installation, re-testing, costs of
transportation or warehousing.  SELLER shall not be liable for consequential
damages incurred by BUYER such as loss of profit, loss of use or production, and
costs of capital.

 
(c)
BUYER, OWNER, and the ultimate owner, shall have the right to enforce SELLER’S
warranty obligations set forth in this clause.

 
GC-11    INFRINGEMENT
 
SELLER shall indemnify BUYER and OWNER and their officers, employees and agents
against liability, including costs, for actual or alleged direct or contributory
infringement of, or inducement to infringe, any United States or foreign patent,
trademark or copyright, arising out of the performance of this PURCHASE ORDER,
provided SELLER is reasonably notified of such claims and proceedings.
 
GC-12 COMPLIANCE
 
(a)
SELLER warrants that all PRODUCTS shall have been produced, sold, delivered and
furnished in strict compliance with all applicable laws and regulations to which
the PRODUCTS are subject. SELLER shall execute and deliver to BUYER any
documents as may be required to effect or to evidence such compliance.  All laws
and regulations required to be incorporated in agreements such as this one are
hereby incorporated herein by reference.

 
(b)
SELLER hereby agrees to indemnify, defend and hold BUYER, OWNER and its
respective affiliates harmless from and against any and all claims, legal
actions, final judgments, reasonable attorneys' fees, civil fines and any other
losses which any of them may incur as a result of the sale or delivery to BUYER
hereunder of PRODUCTS which do not meet all requirements of such laws and
regulations.

 
(c)
SELLER is to comply with all applicable export or import rules and
regulations.  When required by the PURCHASE ORDER shipping/delivery terms,
SELLER is to obtain any necessary export license in a timely manner to avoid
shipment delays.  When BUYER is required by the

 
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Bechtel National Inc
 
Pueblo Chemical Agent Destruction Pilot Plant Project
GENERAL CONDITIONS

 
 
PURCHASE ORDER shipping/delivery terms to obtain any necessary export license,
or to meet the import rules and regulations of the destination country, SELLER
is to timely provide all necessary compliance assistance to BUYER and its
agents.  SELLER shall indemnify, defend and hold harmless BUYER from any
penalties, suits, liabilities or costs (including attorney fees) proximately
caused by SELLER’S failure to comply with applicable export and import rules and
regulations or to comply with its export and import obligations set forth in
this PURCHASE ORDER.
 
GC-13    ASSIGNMENT
 
(a)
Any assignment of this PURCHASE ORDER or of any rights hereunder in any manner,
in whole or in part, by operation of law or otherwise, without the prior written
consent of BUYER shall be void.  Upon ten (10)  days written notice to BUYER,
SELLER may assign monies due or to become due under this PURCHASE ORDER,
provided that any assignment of monies shall be subject to proper set-off in
favor of BUYER and any deductions provided for in this PURCHASE ORDER.

 
(b)
This PURCHASE ORDER may be assigned by BUYER, in whole or in part, to OWNER or
to others upon written notice to SELLER.

 
(c)
To the extent that BUYER is not the ultimate owner of the PRODUCTS being
purchased, all rights, benefits and remedies conferred upon and available to
BUYER under this PURCHASE ORDER shall also accrue and be available to, and are
for the express benefit of OWNER or the ultimate owner if other than OWNER.

 
GC-14    SUSPENSION
 
Notwithstanding any other provisions of this PURCHASE ORDER, BUYER may at any
time, suspend, or extend the time for, SELLER’S performance, upon ten (10) days
prior written notice of such suspension or extension.  Thereafter, SELLER shall
resume performance as directed by BUYER.  In the event of such suspension or
extension, SELLER shall be entitled to reimbursement for additional costs,
excluding profit, reasonable and necessarily incurred by SELLER in effectuating
such suspension or extension period, to the extent that such additional costs
are actually incurred, if claimed within thirty (30) days after resumption of
performance.
 
GC-15    TERMINATION FOR CONVENIENCE
 
(a)
BUYER reserves the right to terminate this PURCHASE ORDER, or any part hereof,
for its sole convenience.  In the event of such termination, SELLER shall
immediately stop all work hereunder and shall immediately cause any and all of
its suppliers and subcontractors to cease work.  Subject to the terms of this
PURCHASE ORDER, SELLER shall be paid a percentage of the PURCHASE ORDER price
reflecting the percentage of the work performed prior to the notice of
termination, plus reasonable charges SELLER can demonstrate to the satisfaction
of BUYER using its standard record keeping system, have resulted from the
termination.  SELLEER shall not be paid for any work performed or costs incurred
that reasonably could have been avoided.

 
(b)
BUYER will pay to SELLER as full compensation: (1) all amounts due and
previously paid to SELLER for PRODUCTS completed in accordance with this
PURCHASE ORDER prior to such notice, and (2)  a reasonable profit for costs
incurred in the performance of the work terminated; provided, however, that if
it appears that SELLER would have sustained a loss on the entire PURCHASE ORDER
had it been completed, no profit shall be included.

 
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Bechtel National Inc
 
Pueblo Chemical Agent Destruction Pilot Plant Project
GENERAL CONDITIONS

 
 (c)
The total sum to be paid to SELLER under this clause, shall not exceed the total
PURCHASE ORDER price as reduced by the amount of payments otherwise made and as
further reduced by the PURCHASE ORDER price of work not terminated, and will not
include any consideration for loss of anticipated profits on the terminated
work, all claims for which SELLER agrees to waive.

 
GC-16
TERMINATION FOR DEFAULT

 
(a)
BUYER may terminate this PURCHASE ORDER, or any part hereof, for cause in the
event of any default by SELLER, or if SELLER fails to comply with any PURCHASE
ORDER terms and conditions, or fails to provide BUYER, upon request, with
adequate assurances of future performance.  In the event of termination for
default, BUYER shall not be liable to SELLER for any amount for supplies or
services not accepted, and SELLER shall be liable to BUYER for any and all
rights and remedies provided by law.  If it is determined that BUYER improperly
terminated this PURCHASE ORDER for default, such termination shall be deemed a
termination for convenience.

 
(b)
In the event BUYER terminates this PURCHASE ORDER, in whole or in part as
provided in this clause, BUYER may procure, upon such terms and in such manner
as BUYER may deem appropriate, PRODUCTS similar to those so terminated, and
SELLER shall be liable to BUYER for any additional costs for such similar
PRODUCTS.

 
GC-17    DISPUTES
 
 
(a)
Any issue arising out of or related to the interpretation or performance of this
PURCHASE ORDER which cannot be resolved by negotiation shall be considered a
dispute within the meaning of this clause.  If for any reason SELLER and BUYER
are unable to resolve a request for an adjustment, SELLER or BUYER shall notify
the other party in writing that a dispute exists.

 
(b)
BUYER shall, within thirty (30) calendar days of any notice of dispute, provide
a written final determination setting forth the contractual basis for its
decision and defining what PURCHASE ORDER adjustments it considers
equitable.  BUYER may in its sole discretion pay such amounts and/or revise the
time for performance of the work in accordance with BUYER’S final determination.

 
(c)
If BUYER’S final determination is not accepted, SELLER shall notify BUYER in
writing and the parties agree to consider resolution of the dispute through some
form of Alternative Dispute Resolution (ADR) process which is mutually
acceptable.

 
(d)
As a condition precedent to consideration of any claim by SELLER in excess of
$100,000, SELLER shall provide a written certification to both BUYER and OWNER
which states:

 
“I certify that this claim is made in good faith, that the supporting data are
accurate and complete to the best of my knowledge and belief; that the amount
requested accurately reflects the contract adjustment for which SELLER believes
BUYER or OWNER is liable; and that I am duly authorized to certify this claim on
behalf of SELLER.”
 
(e)
SELLER shall proceed diligently with performance of this PURCHASE ORDER as
directed by BUYER pending final resolution of any request for adjustment, claim,
appeal, or action regarding any dispute.

 
(f)
If a claim by SELLER is based on alleged actions, inactions or omissions of
OWNER and the interests of justice would be served by resolving SELLER’S claim
in a single proceeding, BUYER may, in its sole discretion, elect to sponsor
SELLER’S claim under the Disputes Clause of

 
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Bechtel National Inc
 
Pueblo Chemical Agent Destruction Pilot Plant Project
GENERAL CONDITIONS

 
 
BUYER’S Prime Contract and allow SELLER to proceed in BUYER’S name.  In the
event that BUYER so sponsors a claim, SELLER agrees to enter into a sponsorship
agreement under which:
 
(1)
SELLER waives its rights to reimbursement from BUYER except to the extent that
OWNER is liable to BUYER, and

 
(2)
SELLER shall reimburse BUYER for any costs and expenses associated with
sponsorship of the claim.

 
GC-18    NON-WAIVER
 
Failure of BUYER to insist upon strict performance of any of the terms and
conditions hereof, or failure or delay to exercise any rights or remedies or to
properly notify SELLER in the event of breach, or the acceptance of or payment
for any PRODUCTS hereunder, shall not release SELLER of any of the warranties or
obligations of this PURCHASE ORDER and shall not be deemed a waiver of any right
of BUYER to insist upon strict performance hereof of any of its rights or
remedies as to any such PRODUCTS.
 
GC-19    COMPLIANCE WITH LAWS UNIQUE TO GOVERNMENT CONTRACTS

SELLER agrees to comply with 31 U.S.C. 1352 relating to limitations on the use
of appropriated funds to influence certain Federal contracts; 18 U.S.C. 431
relating to officials not to benefit; 40 U.S.C. 327, et seq., Contract Work
Hours and Safety Standards Act; 41 U.S.C. 51-58, Anti-Kickback Act of 1986; 41
U.S.C. 265 and 10 U.S.C. 2409 relating to whistleblower protections; 49 U.S.C.
40118, Fly American; and 41 U.S.C. 423 relating to procurement integrity.
 
GC-20    APPLICABLE LAW
 
Irrespective of the place of performance, the provisions in this PURCHASE ORDER
shall be construed and interpreted according to the federal common law of
government contracts, as enunciated and applied by federal judicial bodies,
boards of contracts appeals, and quasi-judicial agencies of the US Federal
Government.  To the extent that the federal common law of government contracts
is not dispositive, the laws of the state of Colorado shall apply.
 
The SELLER agrees to comply with 31 U.S.C. 1352 relating to limitations on the
use of appropriated funds to influence certain Federal contracts; 18 U.S.C. 431
relating to officials not to benefit; 40 U.S.C. 327, et seq., Contract Work
Hours and Safety Standards Act; 41 U.S.C. 51-58, Anti-Kickback Act of 1986; 41
U.S.C. 265 and 10 U.S.C. 2409 relating to whistleblower protections; 49 U.S.C.
40118, Fly American; and 41 U.S.C. 423 relating to procurement integrity.
 
GC-21    REPRESENTATIONS AND CERTIFICATIONS
 
Representations and Certifications included in BUYER’S request for proposal and
submitted in SELLER’S offer are hereby incorporated by reference into this
PURCHASE ORDER.
 
GC-22    SELLER TERMS AND CONDITIONS EXCLUDED
 
The only terms and conditions which will apply to this PURCHASE ORDER are the
BUYER'S terms and conditions included herein or attached hereto.  No terms and
conditions of the SELLER included in a price book incorporated herein or any
field ticket or invoice will apply to this PURCHASE ORDER.

 
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Bechtel National Inc
 
Pueblo Chemical Agent Destruction Pilot Plant Project
GENERAL CONDITIONS

GC-23 UNITED STATES GOVERNMENT FLOW DOWN REQUIREMENTS

The United States Government clauses applicable to this PURCHASE ORDER are
incorporated by reference and included as Appendix FOA-1 to the PURCHASE ORDER
Cover Page.

 GC-24 RECORDS AND AUDIT

(a)
SELLER shall maintain records and accounts in connection with the performance of
this subcontract which will accurately document incurred costs, both direct and
indirect, of whatever nature for a period of three (3) years from final payment
unless otherwise specified by applicable law.  BUYER, GOVERNMENT, or their
representatives shall have the right to examine and copy, at all reasonable
times and with advance notification, such records and accounts for the purpose
of verifying payments or requests for payment when costs are the basis of such
payment and to evaluate the reasonableness of proposed subcontract price
adjustments and claims.

(b)
For Purchase Orders in excess of $100,000.00, FAR clause 52.215-2, Audit and
Records – Negotiation (JUN 1999) shall also apply.

 
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UNITED STATES GOVERNMENT FLOW DOWN REQUIREMENTS

Bechtel National Inc.

Pueblo Chemical Agent Destruction Pilot Plant Project

APPENDIX FOA-1

Commercial Items

PRIME CONTRACT DAAAA09-03-D-0025 GOVERNMENT CLAUSES
INCORPORATED BY REFERENCE

(a)
The Federal Acquisition Regulation (FAR) clauses and the Department of Defense
DFAR clauses, which are incorporated by reference herein shall have the same
force and effect as if printed in full text.

(b)
Full text of the reference clauses may be accessed electronically:

(1)           For FAR clauses, at website address http://www.arnet.gov/far/

(2)           For DFAR clauses, at website address
http://farsite.hill.af.mil/vfdffara.htm

(c)
Wherever necessary to make the context of the unmodified FAR and DFAR applicable
to this PURCHASE ORDER:

 
(1)
The term "Contractor" shall mean "SELLER;"

 
(2)
The term "Contract" shall mean this PURCHASE ORDER; and

 
(3)
The term "GOVERNMENT," "Contracting Officer" and equivalent phrases shall mean
BUYER and/or CONTRACTOR'S representative, except the terms "GOVERNMENT" and
"Contracting Officer" do not change:

 
(i)
In the phrases “GOVERNMENT Property,” “Government-Furnished Property,” and
“Government-Owned Property;”

 
 
(ii)
In any patent clauses incorporated herein;

 
 
(iii)
When a right, act, authorization or obligation can be granted or performed only
by the Government or the prime contract Contracting Officer or his duly
authorized representative;

 
 
(iv)
When title to property is to be transferred directly to the Government;

 
 
(v)
When access to proprietary financial information or other proprietary data is
required except for authorized audit rights; and

 
 
(vi)
Where specifically modified herein.

 
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Bechtel National Inc
 
Pueblo Chemical Agent Destruction Pilot Plant Project
APPENDIX FOA-1

                                                                                                       

APPLIES TO ALL COMMERCIAL ITEM PURCHASE ORDERS
FAR / DFAR
Clause No.
Description
Date
Instructions
52.203-3
Gratuities
APR 1984
None.
52.211-15
Defense Priority and Allocation Requirements
SEP 1990
None
52.222-26
Equal Opportunity
APR 2002
This clause applies if workers were recruited or hired in the U.S
52.223-3
Hazardous Material Identification and Material Safety Data
JAN 1997
None
52.225-11
Buy American Act Requirement - Construction Material Under Trade Agreement
FEB 2000
Permanent equipment installed in the plant or non-consumable materials used to
construct the plant or to be affixed to the plant  Products to be provided under
this PO are "construction material".
52.225-13
Restrictions on Certain Foreign Purchases
JAN 2004
None.
52.227-1
Authorization and Consent
JUL 1995
None
52.227-2
Notice and Assistance Regarding Patent and Copyright Infringement
AUG 1996
None
52.227-4
Patent Indemnity – Construction Contracts
OCT
1995
None
52.232-8
Discounts for Prompt Payment
MAY 1997
None
52.244-6
Subcontracts for Commercial Items
MAY 2002
None
52.247-64
Preference for Privately Owned U.S.-Flag Commercial Vessels
APR 2003
None.
252-204-7000
Disclosure of Information
DEC 1991
In paragraph (b) “45 days” is revised to “60 days”
252.223-7001
Hazard Warning Labels
DEC 1991
None.
252.225-7012
Preference for Certain Domestic Commodities
APR 2002
None
252,225-7013
Duty-Free Entry
JAN
2004
None
252.225-7014
Preference for Domestic Specialty Metals, Alternate 1
Dec 1991
None

 
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252.225-7031
Secondary Arab Boycott of Israel
APR 2003
None.
252.227-7016
Rights in Bid or Proposal Information
JUN 1995
None
252.227-7025
Limitations on the Use or Disclosure of Government Furnished Information Marked
with Restrictive Legends
JUN 1995
None
252.227-7026
Deferred Delivery of Technical Data or Computer Software
APR 1988
None
252.227-7027
Deferred Ordering of Technical Data or Computer Software
APR 1988
None
252.227-7028
Technical Data or Computer Software Previously Delivered to the Government
JUN 1995
None
252.227-7033
Rights in Shop Drawings
APR
1966
None
252.243-7001
Pricing of Contract Modifications
DEC 1991
None
252.243-7002
Requests for Equitable Adjustments
MAR 1998
None
252.244-7000
Subcontracts for Commercial Items and Commercial Components
MAR 2000
None
252-247-7023
Transportation  of Supplies by Sea
MAY 2002
In paragraph (d) “45 days” is revised to 60 days,
252.247-7024
Notification of Transportation of Supplies by Sea
NOV 1995
None
APPLIES TO ALL COMMERCIAL ITEM PURCHASE ORDERS IN EXCESS OF $3,000
52.222-3
Convict Labor
AUG 1996
None
APPLIES TO ALL COMMERCIAL ITEM PURCHASE ORDERS IN EXCESS OF $10,000
52.222-21
Prohibition of Segregated Facilities
FEB 1999
None.
52.222-36
Affirmative Action for Workers with Disabilities
JUN 1998
This clause applies if workers were recruited or hired in the U.S.
APPLIES TO ALL COMMERCIAL ITEM PURCHASE ORDERS IN EXCESS OF $25,000
52.222-35
Affirmative Action for Disabled Veterans and Veterans of the Vietnam Era
 
DEC 2001
This clause applies if workers were recruited or hired in the U.S.

 
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APPLIES TO ALL COMMERCIAL ITEM PURCHASE ORDERS IN EXCESS OF $100,000
52.203-6
Restrictions on Subcontractor Sales to the Government  ALT I
JUL 95
None.
52.203-7
Anti-Kickback Procedures
JUL 95
Excluding Para c(1)
52.203-12
Limitation on Payments to Influence Certain Federal Transactions
JUN 1997
None.
52.204-4
Printed or Copied Double Sided on Recycled Paper
AUG 2000
None.
52.215-2
Audit and Records—Negotiation
JUN 1999
None
 
 
52.219-8
Utilization of Small Business Concerns
OCT 2000
None
52.242-13
Bankruptcy
JUL
1995
None
APPLIES TO ALL COMMERCIAL ITEM PURCHASE ORDERS IN EXCESS OF $500,000
252.226-7001
Utilization of Indian Organizations, Indian-Owned Economic Enterprises, and
Native Hawaiian Small Business Concerns
SEP 2004
None
252.249-7002
Notification of Anticipated Program Termination or Reduction
DEC 1996
None
APPLIES TO ALL COMMERCIAL ITEM PURCHASE ORDERS IN EXCESS OF $550,000
52.215-11
Price Reduction for Defective Cost or Pricing Data – Modifications
OCT 1997
Applies only if none of the exceptions to requirements for cost or pricing data
under FAR 15.403-4 apply.
 
 
52.215-13
Subcontractor Cost or Pricing Data – Modifications
OCT 1997
Applies only if none of the exceptions to requirements for cost or pricing data
under FAR 15.403-4 apply.
 
 
52.215-19
Requirements for Cost or Pricing Data or Information Other than Cost or Pricing
Data
OCT 1997
None
252-215-7000
Pricing Adjustments
DEC 1991
None

 

 
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SECTION 4B – SPECIAL CONDITIONS

COMMERCIAL ITEM

Bechtel National Inc.
Pueblo Chemical Agent Destruction Pilot Plant Project

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Table of Contents

SC
Title
Page
     
SC-1
AUTHORIZED REPRESENTATIVES
2
SC-2
NOTICES
2
SC-3
NONDISCLOSURE
2
SC-4
BACKCHARGES
3
SC-5
SAFETY FOR BUYER AND OWNER REPRESENTATIVES
3
SC-6
LABOR DISPUTES
4
SC-7
HAZARDOUS AND TOXIC SUBSTANCES DISCLOSURE REQUIREMENTS
4
SC-8
SUSPECT/COUNTERFEIT ITEMS
4
SC-9
BANKRUPTCY
5
SC-10
PUBLICITY
5
SC-11
BUYER’S APPROVAL OF SELLER’S MAJOR SUPPLIERS
5
SC-12
SUBCONTRACTING PLAN
5
SC-13
GOVERNMENT FURNISHED PROPERTY
6
SC-14
PERFORMANCE AND PAYMENT SECURITIES
6
SC-15
SELLER’S PARENT COMPANY GUARANTEE
6
SC-16
ON-SITE SERVICES OF SELLER’S REPRESENTATIVES
6
SC-17
MODIFICATIONS TO GENERAL CONDITIONS
6
     

 

 
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SPECIAL CONDITIONS

COMMERCIAL ITEM

Bechtel National Inc
Pueblo Chemical Agent Destruction Pilot Plant Project 

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SC-1       AUTHORIZED REPRESENTATIVES

(a)
Immediately following the award of this PURCHASE ORDER, SELLER shall designate
in writing an authorized representative to represent and act for SELLER and
shall specify any and all limitations of such representative’s authority.  If
SELLER is a joint venture or consortium of two or more members, such parties
shall designate one authorized representative to act for them and to bind the
joint venture or consortium and each of its members.

(b)
All communications given to the authorized representative by BUYER in accordance
with this PURCHASE ORDER shall be binding upon SELLER.  BUYER shall designate,
in writing, one or more representatives to represent and act for BUYER and to
receive communications from SELLER.  Notification of changes of authorized
representatives for either BUYER or SELLER shall be provided in advance, in
writing, to the other party.

SC-2       NOTICES

Any notice pursuant to the terms and conditions of this PURCHASE ORDER shall be
in writing and either (a) delivered personally; (b) sent by certified mail,
return receipt requested; (c) sent by a recognized overnight post or courier
service with delivery receipt requested; or (d) sent by facsimile transfer or
e-mail and acknowledged by recipient via a separate transmittal:

  If to BUYER:

Bechtel National, Inc.
PSB
45825 Hwy 96E
Pueblo, CO  81006
Attention: Shondel Gordon-Baum
E-mail: smgordon@bechtel.com

If to SELLER

OI Analytical/SMC Field Products
Attention: Greg Houston
E-Mail Address: ghouston@oico.com

SC-3      NONDISCLOSURE

SELLER agrees not to divulge to third parties, without the prior written consent
of BUYER, any information obtained from or through BUYER in connection with the
performance of this PURCHASE ORDER unless (i) the information is known to SELLER
prior to obtaining the same from BUYER; (ii) the information is, at the time of
disclosure by SELLER, then in the public domain; or (iii) the information is
obtained by SELLER from a third party who did not receive the same directly or
indirectly from BUYER, its affiliates or related entities or its customers, and
who has no obligation of secrecy with respect thereto. SELLER further agrees it
will not, without the prior written consent of BUYER, disclose to any third
party any information developed or obtained by SELLER in the performance of this
PURCHASE ORDER except to the extent that such information falls in the category
of (i), (ii), or (iii) above.  If so requested by BUYER, SELLER further agrees
to require its employees and its sub-suppliers and their employees to execute an
appropriate nondisclosure PURCHASE ORDER prior to performing any work under this

 
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SPECIAL CONDITIONS

COMMERCIAL ITEM

Bechtel National Inc
Pueblo Chemical Agent Destruction Pilot Plant Project

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PURCHASE ORDER.

 SC-4 BACKCHARGES

(a)
BUYER may, in addition to any other amounts to be retained hereunder, retain
from any sums otherwise owing to SELLER amounts sufficient to cover the full
costs of any of the following:

 
(1)
SELLER’S failure to comply with any provision of this PURCHASE ORDER or SELLER’S
acts or omissions in the performance of any part of this PURCHASE ORDER,
including, but not limited to, violation of any applicable law, order, rule or
regulation, including those regarding safety, hazardous materials or
environmental requirements.

 
(2)
Correction of defective or nonconforming work by redesign, repair, rework,
replacement or other appropriate means when SELLER states, or by its actions
indicates, that it is unable or unwilling to proceed with corrective action in a
reasonable time.

(b)
BUYER may also backcharge SELLER for work done or cost incurred to remedy any
other SELLER defaults, errors, omissions or failures to perform or observe any
part of this PURCHASE ORDER.  BUYER may, but shall not be required to, give
SELLER written notice before performing such work or incurring such cost.

(c)
The cost of backcharge work shall include:

 
(1)
Incurred labor costs including all payroll additives;

 
(2)
Incurred net delivered material costs;

 
(3)
Incurred lower-tier supplier and subcontractor costs directly related to
performing the corrective action;

 
(4)
Equipment and tool rentals at prevailing rates in the Jobsite area; and

 
(5)
A factor applied to the total of Items (1) through (4) for BUYER’S
Government-approved indirect rates and G&A costs.

(d)
The backcharge notice may request SELLER'S concurrence for BUYER to proceed with
the required work.  SELLER’S failure to concur shall not impair BUYER'S right to
proceed with the action or work under this provision.

(e)
BUYER may separately invoice or deduct from payments otherwise due to SELLER the
costs as provided herein.  BUYER'S right to backcharge is in addition to any and
all other rights and remedies provided in this PURCHASE ORDER or by law.  The
performance of backcharge work by BUYER shall not relieve SELLER of any of its
responsibilities under this PURCHASE ORDER including but not limited to express
or implied warranties, specified standards for quality, contractual liabilities
and indemnifications, and meeting the promised shipment dates.

SC-5      SAFETY FOR BUYER AND OWNER REPRESENTATIVES
 
(a)
SELLER shall ensure the safety of BUYER and OWNER representatives while present
at or in

 
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SPECIAL CONDITIONS

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Pueblo Chemical Agent Destruction Pilot Plant Project

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SELLER’S plants and the plants of SELLER’S suppliers for any purpose in
connection with the PRODUCTS, or any part thereof, being furnished by SELLER
under this PURCHASE ORDER.  If, at any time, a BUYER and/or OWNER representative
deems that the conditions at SELLER’S plants or the plants of SELLER’S suppliers
are unsafe and promptly notifies SELLER accordingly, BUYER’S and OWNER’S
representative(s) shall be entitled to suspend their activities (including, but
not limited to, any activities relating to expediting, quality surveillance and
delivery) at such plants until such time as the unsafe conditions are resolved
by SELLER to BUYER’S reasonable satisfaction.

(b)
If any BUYER or OWNER activities are suspended under this clause, SELLER shall
promptly reschedule any work required to be conducted in the presence of a BUYER
and/or OWNER representative and SELLER shall be fully liable for any resulting
delay(s).  SELLER shall also be liable for all costs (including, but not limited
to, costs for labor, transportation and lodging) incurred by BUYER and OWNER due
to any such suspension and subsequent resumption of BUYER and/or OWNER
activities at SELLER’S plants or the plants of SELLER’S suppliers under this
PURCHASE ORDER.

SC-6      LABOR DISPUTES

Whenever SELLER has knowledge that any actual or potential labor dispute is
materially delaying or threatening to materially delay its performance on the
Project, SELLER shall promptly give written notice thereof, including all
relevant information with respect thereto, to BUYER.

SC-7      HAZARDOUS AND TOXIC SUBSTANCES DISCLOSURE REQUIREMENTS

In the performance of this PURCHASE ORDER, SELLER shall comply with all
applicable laws, rules, requirements, and ordinances including, but not limited
to, those relating to environmental law, toxic or hazardous materials,
occupational health and safety.  If this PURCHASE ORDER calls for the transfer
to BUYER and/or OWNER by SELLER of any chemical substance or mixture, or any
material which may generate or release a chemical substance or any hazardous
agent, SELLER shall provide before or with said transfer a Material Safety Data
Sheet (Federal OSHA Hazard Communication Standard, 29 CFR 1910.1200) and label
which are current, accurate and complete, which include but are not limited to a
statement of PRODUCT hazards and precautions for safe use.  Copies of the
Material Safety Data Sheet shall include the Purchase Order number, shipping
location, and shall be sent to the shipping location identified in this PURCHASE
ORDER.

SC-8      SUSPECT/COUNTERFEIT ITEMS

Items furnished under this Purchase Order are intended for use in a U.S.
Government-owned facility.  Items delivered under this Purchase Order may
contain potentially suspect or counterfeit items or materials (i.e., fasteners,
electrical components, mechanical devices, piping/piping system components,
and/or raw-stock metals).  SELLER and its sub-suppliers shall maintain
sufficient control to prevent the procurement, installation, use, and delivery
of materials and equipment that contain or exhibit suspect or counterfeit item
characteristics or conditions.  Additional information and guidance, to include
the United States Department of Energy (DOE) Suspect Headmark List, can be
obtained at: http://www.qmo.bnl.gov/SCI/bkltview.pdf (Brookhaven National
Laboratory website)

SELLER is solely responsible for all costs associated with the discovery,
removal, replacement, and impoundment of materials and equipment that contain or
exhibit suspect or counterfeit item characteristics

 
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SPECIAL CONDITIONS

COMMERCIAL ITEM

Bechtel National Inc
Pueblo Chemical Agent Destruction Pilot Plant Project

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or conditions.

1.
Unless otherwise specified, all materials and all material components and parts,
associated with manufactured equipment, including that permanently installed
into systems, subsystems, and/or assemblies, shall be new and
unused.  Refurbished, rebuilt, or modified items are strictly prohibited unless
specifically authorized in writing by BUYER.

   
2.
Materials and equipment delivered under this Purchase Order shall exhibit the
manufacturer’s original labels and identification. Materials and equipment
delivered under this Purchase Order will be inspected by BUYER for indications
of suspect or counterfeit characteristics and/or conditions.
   
 3.
Materials, equipment, or assemblies that consist of, or contain high strength
fasteners (e.g., grades 5, 8, 8.2, A325, and A490, internally/externally
threaded and greater than 0.25” in diameter), shall exhibit both grade marks and
the manufacturer's identification symbol (headmark), in accordance with the
applicable specification (i.e., ASTM, SAE, etc.). Fasteners with headmarkings
identified on the DOE Headmark List, are STRICTLY PROHIBITED. Materials,
equipment, or assemblies consisting of, or containing high strength fasteners,
which DO NOT exhibit both grade marks and the manufacturer’s identification
symbol constitute a nonconformance with the Purchase Order requirements.
   
 4.
Materials, equipment, or assemblies that consist of, or contain electrical
components shall exhibit as applicable, legible amperage and voltage ratings,
operating parameters, and the product manufacturer’s labels and
identification.  Electrical components shall exhibit as applicable to the item
or component, Underwriters Laboratory (UL) or Factory Mutual (FM) labels.
   
 5.
Materials, equipment, or assemblies that consist of, or contain mechanical,
piping, and piping system components and/or parts, shall clearly exhibit all
markings as required by the ordering data or specifications and the original
manufacturer’s labels and identification.
   

Detection by BUYER of any suspect or counterfeit condition leading to evidence
of deliberate misrepresentation of any supplied item may result in an
investigation into the validity of certification, fraud, and/or forgery, by the
U.S. Government.

SC-9      BANKRUPTCY

In the event SELLER enters into proceedings relating to bankruptcy, whether
voluntary or involuntary, SELLER agrees to furnish BUYER written notification of
the bankruptcy within ten (10) business days of the proceedings.

SC-10    PUBLICITY

SELLER shall obtain BUYER’S prior written approval of the text of any external
announcement, publication, or other type of public communication concerning the
Project prior to the release of the same by SELLER.  SELLER agrees to obtain
prior written approval in the same form from OWNER.

SC-11    BUYER’S APPROVAL OF SELLER’S MAJOR SUPPLIERS

SELLER is required to obtain BUYER’S approval for equipment or contracts, which
will not be unreasonably withheld, two (2) weeks prior to placement of such
orders.  The intent is not to restrict SELLER’S ability to use global sourcing,
but to ensure BUYER that SELLER is using reliable, proven and qualified
suppliers, and to provide adequate notification to the US Government
Representative in accordance with the BUYER’s contract with the OWNER.  This
clause applies to all purchases and subcontracts of a value of US$ 100,000 or
greater.

 
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 SPECIAL CONDITIONS

COMMERCIAL ITEM

Bechtel National Inc
Pueblo Chemical Agent Destruction Pilot Plant Project

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SC-12    SUBCONTRACTING PLAN

(a)
A Subcontracting Plan shall be submitted in accordance with Appendix FOA-1 of
this Agreement title United States Government Flow Down Requirements,” FAR
Clause 52.219-9 titled “Small Business Subcontracting Plan” and approved by
BUYER for this PURCHASE ORDER.  Upon BUYER’S approval, SELLER’S Small Business
Subcontracting Plan shall be deemed incorporated into this PURCHASE ORDER.

(b)
Subcontracting Reports will be submitted on FAR Standard Forms 294 and 295.  In
addition to the distribution contained on the reverse side of these forms,
copies of these reports shall be delivered as follows:

 

 
Distribution
Addressee
           
1 original and 1 copy SF-294
Bechtel National Inc.
     
PSB
     
45825 Hwy 96E
     
Pueblo, CO 81006
     
Attn: Shondel Gordon-Baum
           
 1 original and 1 copy SF-295
Bechtel National Inc.
     
PSB  45825 Hw 96E
     
Pueblo, CO 81006
     
Attn: Shondel Gordon-Baum
 

 
(c)
Failure of SELLER to comply in good faith with said plan may be considered a
material breach and subject to termination.

 
SC-13    GOVERNMENT FURNISHED PROPERTY

 Reserved

SC-14    PERFORMANCE AND PAYMENT SECURITIES

Reserved

SC-15    SELLER’S PARENT COMPANY GUARANTEE

Reserved
 
SC-16    ON-SITE SERVICES OF SELLER’S REPRESENTATIVES
 
Reserved

SC-17     MODIFICATIONS TO GENERAL CONDITIONS - NONE

 
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