City Council Agenda Report
Meeting Date: May 6, 2025
From: Daniel S. Wall, P.E., Director of Public Works
Department: Public Works
Submitted by: Hannia Contreras, Administrative Assistant Subject
Contract with Pavement Coatings Co. for Citywide Slurry Seal Project Recommendation
A. Find that award of the proposed Citywide Slurry Seal Project is categorically exempt under the California Environmental Quality Act (CEQA) in accordance with CEQA Guidelines Section 15301 (Existing Facilities), part (c) (existing highways and streets), because the project is merely to repair existing streets and involves no expansion of existing use; B. Accept the bid proposal from Pavement Coatings Co. as the lowest responsive and responsible bidder for the Citywide Slurry Seal Project, and reject all other bids; C. Approve and authorize the City Administrator to execute a contract with Pavement Coatings Co., in substantially the same form as submitted, for citywide street improvements in an amount not-to-exceed $667,840.53; and
D. Authorize a contingency amount of ten percent (10%) or $66,784.05 in the event of an unexpected changed condition in the project, and grant authority to the City Administrator to issue change orders for an amount up to the contingency amount, if necessary.
Background
The proposed Street Improvement Capital Project (Project) involves the installation of a rubberized asphalt slurry seal on various streets throughout the city. The contract for this work also includes mobilization/demobilization, traffic control, removal and installation of striping and pavement markings.
On February 18, 2025, the Notice Inviting Bids (NIB) for Citywide Slurry Seal Project was advertised in accordance with Section 3.32.070(A) of the Vernon Municipal Code (VMC). The NIB was posted on the City’s PlanetBids website. The Department has utilized the template Notice Inviting Bids, Bid form and Project Specifications, Instruction to Bidders, and Specifications and Contract approved by City Council. The bids for Citywide Slurry Seal Project, were received and opened on April 1, 2025. The calculated results were as follows:
1. Pavement Coatings Co. $667,840.53
2. All American Asphalt $689,442.30
3. Union Pavement Services $698,308.25
Based on a thorough evaluation of the bids, Public Works staff has determined that the bid received from Pavement Coatings Co. is the lowest responsive and responsible bid and recommends award of the proposed contract to Pavement Coatings Co.
Pursuant to VMC Section 3.32.030 (A), all contracts over $100,000 require City Council approval.
The proposed contract with Pavement Coatings Co., is not-to-exceed $667,840.53. Therefore, it is recommended that City Council approve and authorize the City Administrator to execute a contract with Pavement Coatings Co.
The proposed contract has been reviewed and approved as to form by the City Attorney’s Office.
Fiscal Impact
The fiscal impact is estimated at $734,624.58, including a contingency of ten percent (10%).
Funds are available in General Fund, Public Works Department, Street Maintenance Division, Capital Outlay Account No. 011-040-430-660000 in the amount of $500,000. However, approval of this action would require an additional appropriation of $234,624.58 in General Fund, Public Works Department, Capital Outlay Fund Balance or General Fund Unassigned Balance.
Attachments
1. Contract with Pavement Coatings Co.
City Council Agenda Report
Meeting Date: May 6, 2025
From: Daniel S. Wall, P.E., Director of Public Works
Department: Public Works
Submitted by: Hannia Contreras, Administrative Assistant Subject
Services Agreement with Axiom Group for On-Call Sidewalk Repair Services Recommendation
A. Find that the proposed action is categorically exempt from California Environmental Quality Act (CEQA) review, in accordance with CEQA Guidelines Section 15301, because the project consists of the maintenance, repair or minor alteration of existing facilities and involves negligible or no expansion of an existing use; and
B. Approve and authorize the City Administrator to execute a Services Agreement with Axiom Group, in substantially the same form as submitted, for On-Call Sidewalk Repair Services for a total amount not-to-exceed $400,000, for a three (3) year term.
Background
The Public Works Department is seeking to retain a contractor for general engineering construction services for the removal and replacement of existing damaged concrete sidewalks.
The work is to be performed on an on-call and as-needed basis, based on work orders issued by the City. The City will issue work orders and work with the selected contractor to implement the improvements in a prompt timeframe.
Pursuant to Vernon Municipal Code (VMC) Section 3.32.080, the Public Works Department issued a Request for Proposals (RFP) to select a firm that could provide the desired services. The RFP for On-Call Sidewalk Repair Services was issued on February 10, 2025, via the PlanetBids online portal with responses due by March 4, 2025. Six firms submitted proposals in response to the RFP by the specified deadline. After a review of the proposals, it was determined that Axiom Group will best meet the needs of the Department based on responsiveness to the RFP, professional qualifications, and experience.
Pursuant to VMC Section 3.32.030 (A), all contracts over $100,000 require City Council approval.
The proposed Services Agreement with Axiom Group, is not-to-exceed $400,000. Therefore, it is recommended that City Council approve and authorize the City Administrator to execute a services agreement with Axiom Group. The proposed Services Agreement has been reviewed and approved as to form by the City Attorney’s Office.
Fiscal Impact
The fiscal impact is not-to-exceed $400,000 for the three (3) year term of the Services Agreement. Sufficient funds are available in General Fund, Public Works Department, Administration-Engineering-Planning, Professional Services - Account No. 011-040-400-529215 for the current fiscal year and will be budgeted in subsequent years.
Attachments
1. Services Agreement with Axiom Group
City Council Agenda Report
Meeting Date: May 6, 2025
From: Todd Dusenberry, General Manager of Public Utilities Department: Public Utilities
Submitted by: Efren Peregrina Renteria, Procurement Specialist Subject
Purchases Related to the Fall 2025 Malburg Generating Station (MGS) Planned Outage Recommendation
A. Find that the proposed action is categorically exempt from the California Environmental Quality Act (CEQA) review, in accordance with CEQA Guidelines Section 15301, because the project consists of the maintenance, repair or minor alteration of an existing facility and involves negligible or no expansion of an existing use;
B. Approve and authorize the issuance of a purchase order (PO) with Siemens Energy, Inc., for the purchase of steam turbine generator parts for a total amount not-to-exceed $535,861.68; C. Authorize a contingency amount of fifteen percent (15%) or $80,379.25 in the event of unforeseen expenses and grant authority to the City Administrator to approve the issuance of change orders to the PO for steam turbine generator parts, up to the contingency amount, if necessary;
D. Approve and authorize the issuance of a PO with Siemens Energy, Inc., for the purchase of replacement valve seats for a total amount not-to-exceed $387,249.63; E. Authorize a contingency amount of fifteen percent (15%) or $58,087.44 in the event of unforeseen expenses and grant authority to the City Administrator to approve the issuance of change orders to the PO for replacement valve seats, up to the contingency amount, if necessary; F. Approve and authorize the issuance of a PO with Siemens Energy, Inc., for the installation of new high-pressure (HP) and low-pressure (LP) steam strainers and the redesign of the Emergency Stop Valve for a total amount not-to-exceed $325,545; G. Authorize a contingency amount of twenty percent (20%) or $65,109 in the event of unforeseen expenses and grant authority to the City Administrator to approve the issuance of change orders to the PO for HP & LP steam strainer installations and redesign of the Emergency Stop Valve, up to the contingency amount, if necessary; H. Approve and authorize the issuance of a PO with First Global Gear Services LLC, for the purchase of gearbox bearings for a total amount not-to-exceed $116,708.42; and I. Authorize a contingency amount of fifteen percent (15%) or $17,506.26 in the event of unforeseen expenses and grant authority to the City Administrator to approve issuance of change orders to the PO for gearbox bearings, up to the contingency amount, if necessary.
Background
This report outlines the proposed purchase orders (POs) related to the planned Malburg Generating Station (MGS) Outage in December 2025, with a total cost not-to-exceed $1,586,446.68.
On November 16, 2021, City Council adopted Resolution No. 2021-41, approving a Purchase and Sale Agreement (PSA) with Bicent (California) Malburg LLC (Bicent) for the acquisition of the MGS. MGS undergoes a scheduled major planned outage every 30,000 equivalent operating hours, or roughly 3 to 4 years, and mostly in the fall and spring when the electricity demand is lower. On August 20, 2024, City Council approved Change Order No. 20 to the Amended and Restated Services Agreement with Siemens Energy, Inc., (Siemens Energy) to revise the Projected Schedule Outage Plan, Payment Schedule, Cancellation Schedule, Upgrade
Schedule, Dehumidifier Upgrade, Burner 26 Upgrade, Gearset Upgrade, Starter Motor Upgrade, amend the termination date of the agreement, and add a blanket Purchase Contracts schedule.
These major outages necessitate collaboration with various vendors to carry out a range of tasks, including essential maintenance work on MGS. The power plant is required to maintain full resource adequacy for the California Independent System Operator (CAISO) on a daily basis.
MGS operates as a 139 Megawatt (MW) 2x1 combined cycle generating facility, featuring two Siemens SGT-800 Combustion Turbines. The Steam Turbine Generator (STG) features two critical valves for each steam line: the Emergency Stop Valve (ESV) and the Control Valve (CV).
These valves are essential for regulating and stopping steam flow to the STG, making them vital components before steam reaches the turbine's rotating blades.
MGS is set to undergo its Fall maintenance outage in December 2025. To maintain compliance with CAISO regulations and ensure the ongoing functionality of the MGS power plant, it is crucial to perform the required maintenance during this scheduled downtime. The upcoming outage will feature a "Limited Overhaul" of the STG, as outlined in Change Order No. 20. This limited overhaul will primarily focus on essential inspections and refurbishments of critical valves, including the removal and on-site rebuilding of both the high-pressure (HP) and low-pressure (LP) admission valves. Furthermore, the reduction gearbox and various other essential components and bearings will be examined and replaced if their condition is found to be unsatisfactory. The required STG parts for this standard limited overhaul will consist of components previously identified by Siemens Energy for replacement, along with spare items that must be on hand in case any inspected parts are determined to be unfit for continued use.
Additionally, efforts will be made to enhance the existing design of the ESV to minimize the risk of oil leakage, which could pose a fire hazard.
The proposed POs are exempt from competitive bidding and competitive selection pursuant to Sections 3.32.110 (A)(2) and 3.32.110 (B)(l) of the Vernon Municipal Code (VMC). This exemption arises from the specialized requirements for the parts needed for the STG, which are exclusively produced by Siemens Energy, the original equipment manufacturer (OEM), and the only supplier. Furthermore, there are no other authorized vendors for the required parts since the designs and raw material specifications are proprietary. Additionally, First Global Gear Services LLC (FGGS) serves as the OEM and sole-source provider for the shaft-driven speed-reduction gearbox utilized in the Steam Turbine and Gas Turbines at MGS.
Due to the long lead times associated with this equipment, staff recommends approval of several POs and related contingencies to ensure timely delivery ahead of the outage. Contingencies of 15% or 20% are to cover additional costs that may be incurred due to any unforeseen or fluctuating expenses including tariffs, currency exchange rates, taxes, freight, custom clearance fees, insurance, and duties that may apply. The proposed POs and corresponding contingencies are as follows:
• PO with Siemens Energy for $535,861.68 to purchase STG parts; and 15% contingency or $80,379.25;
• PO with Siemens Energy for $387,249.63 to purchase replacement valve seats; and 15% contingency or $58,087.44;
• PO with Siemens Energy for $325,545 for the installation of new HP and LP steam strainers and for the redesign of the Emergency Stop Valve; and 20% contingency or $65,109; and
• PO with FGGS for $116,708.42 for gearbox bearings; and 15% contingency or $17,506.26.
City Council approval of the proposed POs with Siemens Energy and the proposed PO with FGGS is required pursuant to VMC Section 3.32.030(A)(B), as the total value of each of the POs requested exceeds $100,000. Additionally, within the past 12 months, the City has paid or awarded Siemens Energy a total of approximately $3,149,024.44.
The quotes and proposal for Siemens Energy and FGGS have been reviewed and approved as to form by the City Attorney’s Office. Quotes 20382817, 20428105, and Proposal 24319324 from Siemens Energy contain confidential and proprietary information and will be provided to the City Council under separate cover; these items will not be included in the public Agenda Packet.
Fiscal Impact
The fiscal impact is not-to-exceed $1,586,446.68. Sufficient funds are included in the Electric Fund, Malburg Generating Station, Steam Turbine, Account No. 055-050-586-529006 proposed budget for fiscal year 2025-26.
Attachments
1. First Global Gear Services LLC – Quote
1 QUOTE
Number FGGQ142-3
Date 04/15/2025
115 Technology Drive, A-201, Trumbull, CT 06611
t.203-268-5961 f.203-459-0301 e. [email protected]
Sold To Ship To
City of Vernon
4963 South Soto Street,
Vernon, CA, 90058
US
City of Vernon
Jeff Fraga- [email protected]
4963 South Soto Street,
Vernon, CA, 90058
US
Phone : Phone :
Bearings SN 7200 TX93/3C - Malburg Generation CA
Payment Terms Principle Reference Delivery Terms Quote Author 50% ARO, 50% prior to
shipment 2447052 FCA Illkirch France Dana Rumore
Serial Number Model Customer Reference Valid Until
7200 TX90/3C Malburg CA SN 7200 04/30/2025
Line # Quantity Product Description Part Number Delivery Sales Price Total Price 1 2 LS Bearing B110 & B120 05M715 7 months $25,274.00 $50,548.00 2 1 HS Bearing B210 02D528 7 months $25,612.00 $25,612.00 3 1 HS Bearing B220 05F984 7 months $17,394.00 $17,394.00 4 1 Shipping from Flender France to Vernon CA- all inclusive 7-10 days $13,331.25 $13,331.25 Subtotal $106,885.25
Total $116,708.42
Quotation is in USD
Warranty: 12 months of operation, 18 months after delivery, whichever occurs first.
Must be installed by FGGS, as we are the only authorized service provider, to validate warranty
If line 4 is purchased, DDP shipping from Flender France to Vernon CA to include all duties, taxes, custom clearance fees, insurance, and delivery Shipping price subject to change at time of pick up based on lead time.
All duty rates are subject to change without notice based on current government policies. Duty rates provided are a good faith estimate, however, will be/can be updated based on new direction from various governments at the time of actual import.
Tax $9,823.17
2 FIRST GLOBAL GEAR SERVICES LLC TERMS AND CONDITIONS - SERVICES AND PARTS
1. WARRANTY.
a. Services and Parts. Services performed on Customer's equipment by FGGS and any parts supplied by FGGS ("Work") are warranted to conform to the description of such products as provided in the FGGS catalog, analytical data or other literature, to the quotation specifications and to be free from defects in workmanship, material and title for a period of twelve months following the equipment's return to service, or eighteen months following completion of Work or delivery of the part, whichever occurs first. If any services or parts fail to meet the foregoing warranty, at FGGS's option, FGGS shall correct such failure by reperforming any portion of the nonconforming services or repairing or replacing any nonconforming or defective parts. Where a nonconforming or defective part cannot be corrected by FGGS's reasonable efforts, the parties will negotiate an equitable adjustment in price. All costs and risks of access to the equipment, disassembly, installation and reassembly associated with the corrective action shall be borne by Customer, if not included in the original Work scope. The supply of repaired or replacement parts, or reperformed services shall not extend the duration of the warranty period.
b. Exclusive. The preceding paragraphs set forth the exclusive remedies for claims (except as to title) based on failure to conform to the Contract specifications or defects in workmanship, material, parts or services, or professional errors or omissions which may be asserted under any theory including, for example, breach of contract, indemnity, warranty, tort (including FGGS's negligence), strict liability or otherwise. Upon the expiration of the warranty period, all such liability shall terminate and Customer shall have a reasonable time, within ten (10) days after the warranty period, to give written notice of any nonconformance or defects that appear during the warranty period. NO IMPLIED WARRANTY OF MERCHANTABILITY OR FITNESS FOR PURPOSE SHALL APPLY. d. Limits. FGGS's obligations under this Article 1 shall not apply to any part or portion thereof, which (a) is nonconforming or defective due to normal wear and tear including that due to environment or operation, or (b) has a normal life inherently shorter than the warranty period, or (c) is not properly stored, installed, used or maintained other than pursuant to FGGS's written instructions or approval, or (d) has been subjected to any other kind of misuse or detrimental exposure or has been involved in an accident. In addition, this warranty shall be void if FGGS is not promptly notified of any failure in writing or has not been given prompt and complete access to the failed parts or equipment including full access to all diagnostic and repair efforts.
2. LIMITATIONS OF LIABILITY.
a. Notwithstanding anything else contained in this Contract, in no event, whether as a result of breach of contract, indemnity, warranty, tort (including FGGS's negligence), strict liability or otherwise, shall FGGS's liability to Customer, its subsidiaries and affiliates, successors or assigns, or its insurers for any loss or damage arising out of, connected with, or resulting from the Contract, or from FGGS's performance or breach, or from any Work covered by or furnished under the Contract or any extension or expansion thereof (including remedial warranty efforts), exceed the price of the Purchase Order giving rise to the claim.
Except as to title to any parts furnished, all such liability shall terminate upon the expiration of the warranty period specified in Article 1. Any such claim of liability must be commenced in no event later than one year from the termination of the warranty period in accordance with Article 17. This limitation of liability shall not apply to the indemnity for bodily injury or death as set forth in Article
4. b. If FGGS furnishes Customer with advice or assistance concerning any part supplied hereunder or any part, system or equipment in which any such part may be installed and which is not required pursuant to this Contract, the furnishing of such advice or assistance will not subject FGGS to any liability.
C. Customer waives all rights of recovery against FGGS and all rights of subrogation, whether Customer's claim is brought under breach of contract, indemnity, warranty, tort, strict liability or otherwise, for loss or damage to the property of Customer to the extent such claim is covered by insurance maintained by Customer. For the purposes of Articles 2 and 3, the term "FGGS" includes FGGS and its subcontractors, suppliers, subsidiaries and affiliates, their directors, officers, agents, employees, successors and assigns and authorized representatives.
3. CONSEQUENTIAL DAMAGES.
Notwithstanding anything else contained in this Contract, in no event, whether as a result of breach of contract, indemnity, warranty, tort, strict liability or otherwise, shall FGGS be liable to Customer or its subsidiaries and affiliates, successors or assigns, or its insurers for any special, incidental, exemplary, indirect or consequential damages, including, without limitation, loss of profits or revenues, loss of use of any property, parts or any associated equipment, damage to associated equipment, cost of capital, cost of purchased power, cost of substitute equipment, facilities, parts, services or replacement power, downtime costs or claims of customers of Customer for such damages.
4. INDEMNITY.
FGGS and Customer each agree to defend, indemnify, and hold harmless the other party, including the other party's subcontractors, suppliers, subsidiaries and affiliates, their directors, officers, agents, employees, successors and assigns and authorized representatives, from and against any claim, loss, damage or expense for all bodily injury or death, but only to the extent that such bodily injury or death is caused by the indemnifying party's negligence. In the event that such bodily injury or death is caused by the joint or concurrent negligence of FGGS and Customer, the claim, loss, damage or expense shall be borne by each party in proportion to its own negligence.
NOTICE: Sale of any services and/or parts ordered by Customer is expressly conditioned on Customer's assent to the terms contained herein. Any additional or different terms proposed by Customer are expressly objected to and will not be binding upon FGGS unless specifically assented to in writing by FGGS. FGGS's quotation is valid for 90 days, unless withdrawn prior to receipt of Customer's acceptance.
3 FGGS Terms and Conditions Services and Parts
5. INSURANCE.
FGGS, at its expense, shall procure and maintain in effect without interruption during the term of this Contract, policies of insurance providing the coverages and limits specified, and complying with the other requirements stated below (all amounts below are stated in US dollars):
a. Worker's Compensation in statutory amounts with a minimum limit of $1,000,000. b. Commercial General Liability on an Occurrence Basis, with the following coverages and limits:
i. Per Occurrence $1,000,000
ii. General Aggregate $1,000,000
C. Automobile Liability covering automobiles of FGGS, including owned, hired and non-owned automobiles, for Bodily Injury and Property Damage with a combined single limit of $1,000,000 each Occurrence. d. Excess Liability in Umbrella Form with a limit of $1,000,000 each Occurrence, $1,000,000 Aggregate.
6. PATENTS.
FGGS warrants that parts furnished hereunder shall be delivered free of any rightful claim of any third party for infringement of any U.S. patent. If notified promptly in writing and given authority, information and assistance, FGGS shall defend, or may settle, at its expense, any suit or proceeding against Customer so far as based on a claimed infringement of a U.S. patent which would result in a breach of this warranty. In case any part is in such suit held to constitute such an infringement of a U.S. patent and the use for the purpose intended of said part is enjoined, FGGS shall, at its expense and option, either procure for Customer the right to continue using said part, or replace same with a noninfringing part, or modify same so it becomes noninfringing, or remove the part and refund the Contract price. The foregoing states the entire liability of FGGS for patent infringement.
The preceding paragraph shall not apply to any parts specified by Customer or manufactured to Customer's design, or purchased from other sources, or to the use of any parts furnished hereunder in conjunction with any other parts in a combination not furnished by FGGS as part of this Contract.
7. DELIVERY.
Completion dates are approximate and are based upon prompt receipt of the equipment and all necessary information from Customer, or ready access to same if Work is to be done at Customer's facility. Unless otherwise specified by FGGS, all shipments of parts are FCA Manufacturer's facility (Incoterms). The method of shipment for each item is listed in Seller's quotation. Immediately upon Customer's receipt of any goods or parts shipped hereunder, Customer shall inspect the goods or parts and shall notify FGGS in writing of any claims for shortages, defects or damages and shall hold the goods or parts for FGGSs written instructions concerning disposition. If Customer fails to so notify FGGS within five days after the goods or parts have been received by Customer, such goods or parts shall conclusively be deemed to conform to the terms and conditions hereof and to have been irrevocably accepted by the Customer.
8. EXCUSABLE DELAYS.
FGGS shall not be liable for any delay in delivery or performance, or for any failure to manufacture, deliver, or perform Work due to (a) any cause beyond its reasonable control; or (b) any act of God, act of Customer, act of civil or military authority, government priority, fire, severe weather condition, earthquake, strike or other labor disturbance, flood, epidemic, war (declared or undeclared, including civil unrest), riot, terrorist act, delay in transportation or car shortage; or (c) act (or omission) of Customer, including failure to promptly: (i) provide FGGS with information and approvals necessary proceed with performance, (ii) comply with the terms of payment, or (iii) inability on account of any cause beyond the reasonable control of FGGS to obtain necessary materials, components, services or facilities. The date of delivery or of performance shall be extended for a period equal to the time lost by reason of delay, plus such additional time as may be reasonably necessary to overcome the effect of such excusable delay.
FGGS shall notify Customer, as soon as practicable, of the revised date of delivery or of performance. If FGGS is delayed by acts or omissions of Customer, or by the prerequisite work of Customer's other contractors or suppliers, FGGS shall also be entitled to an equitable price adjustment.
9. PAYMENTS AND FINANCIAL CONDITION. Unless otherwise specified by FGGS in its quotation, payments under the Purchase Order shall be due within 30 days of FGGS's issuance of the applicable invoice.
If Customer fails to fulfill any condition of its payment obligations, FGGS may suspend performance and delivery. Any cost incurred by FGGS in accordance with such suspension shall be payable by Customer upon submission of FGGS's invoices.
Any order for Work by Customer shall constitute a representation that Customer is solvent. If the financial condition of Customer at any time does not, in the judgment of FGGS, justify continuance of FGGS's obligations hereunder on the terms of payment agreed upon, FGGS may require full or partial payment in advance or shall be entitled to terminate the Contract and receive termination charges. In the event of bankruptcy or insolvency of Customer or in the event any proceeding is brought against Customer, voluntarily or involuntarily, under the bankruptcy or any insolvency laws, FGGS shall be entitled to cancel any order then outstanding at any time during the period allowed for filing claims against Customer and shall receive reimbursement for its proper cancellation charges. FGGS's rights under this Article 9 are in addition to all rights available to it at law or in equity.
10. TERMINATION.
a. By Customer. Customer shall be entitled to terminate the Contract in the event FGGS fails to commence reasonable cure within thirty (30) days after notice from Customer specifying a material default. FGGS's liability for material default shall be limited to the direct costs that Customer must pay a third party to correct the default, subject however to the limitations contained in Articles 2 & 3. FGGS shall be entitled to recover reasonable termination charges on any order that is terminated unless FGGS is in prior material breach of these Terms and Conditions. Termination of an order shall not relieve either party of any obligation arising prior to termination.
4 FGGS Terms and Conditions Services and Parts
b. By FGGS. If Customer fails to fulfill any condition of its payment obligations and does not correct such failure in the manner and time satisfactory to FGGS, then FGGS may, terminate the Contract in respect to the portion of the parts not delivered and work not yet performed. Customer shall pay FGGS its reasonable and proper termination charges in the event of such termination, in addition to the amounts owed up to the date of termination.
11. TITLE. Title to parts not yet incorporated into Customer's equipment will pass to Customer upon FGGS's receipt of all payments for the parts/services under this Contract. Title and right of possession of equipment repaired, modified, inspected, tested, or maintained under this Contract shall remain with Customer, subject to any applicable lien rights of FGGS and to its right of sale in the event of nonpayment as provided in Article 9.
12. TAXES. In addition to any price specified herein, Customer shall pay the gross amount of any present or future sales, use, excise, value- added, withholding, or other similar tax applicable to the price, sale, or delivery of any parts or services furnished hereunder or to their use by FGGS or Customer, or Customer shall furnish FGGS with a tax exemption certificate acceptable to the taxing authorities.
13. COMPLIANCE WITH LAWS. All transactions hereunder shall at all times be subject to and conditioned upon compliance with all applicable export control laws and regulations of the U.S. Government and any amendments thereof. Customer agrees that it shall not, except as said laws and regulations may expressly permit, make any disposition by way of transshipment, re-export, diversion or otherwise, of U.S. origin goods and technical data (including computer software), or the direct product thereof, supplied by FGGS hereunder. The obligations of the parties to comply with all applicable U.S. export control laws and regulations shall survive any termination, or discharge of any other contract obligations.
Customer undertakes to keep fully informed of, and to comply with, the export control laws and regulations of the U.S.
Government and any amendments thereof. Customer certifies that the parts, materials, services, technical data, software or other information or assistance furnished by FGGS under the Contract will not be (a) used by any individual or entity listed as a prohibited party on any list of the U.S. Government of prohibited or denied parties, (b) sent to any party in a country listed as a prohibited country by the U.S. Government, or (c) used in the design, development, production, stockpiling or use of chemical, biological, or nuclear weapons either by Customer or by any entity acting on Customer's behalf.
Notwithstanding any other provisions herein, Customer shall be responsible for timely obtaining any required authorization, such as an export license, import license, foreign exchange permit, work permit or any other governmental authorization required for the performance of the Work. Customer and FGGS shall provide each other reasonable assistance in obtaining required authorizations. FGGS shall not be liable if any authorization is delayed, denied, revoked, restricted or not renewed and Customer shall not be relieved thereby of its obligations to pay FGGS for its parts or services or any other charges which are the obligation of the Customer hereunder.
14. RESERVATION OF RIGHTS.
FGGS Reserves the right to make copies, prepare derivative works of, or reverse engineer any portion of the components, parts, materials or other information supplied or created under the Contract. Such copies, derivative works or reverse engineering information and data shall be the sole property of FGGS, the use of which shall not be restricted in anyway by Customer. FGGS reserves the right to use any portion of the components, parts, materials or other information supplied or created under the Contract in the development of any other products or intellectual property of any kind, the ownership of which shall vest exclusively in FGGS. The work performed by FGGS shall not be considered "work for hire." Any and all information related to, or arising out of FGGS's intellectual property or improvements is deemed to be the information of FGGS. If any such right, title or interest becomes vested in Customer by operation of law or otherwise, Customer will do everything necessary, to vest all such right, title and interest in FGGS. Customer will execute such further and other documents and do such further and other things as may be necessary to carry out and give effect to the obligations contained in this paragraph, provided however, neither party is obligated to enter into a further business relationship with the other party.
15. DISPUTE RESOLUTION.
All disputes arising in connection with the Contract shall be settled, if possible, by amicable negotiation of the parties. In the event of any dispute, controversy or claim arising out of, connected with, or relating to this Contract, within 30 days of notice of such dispute, the Parties agree to arrange a face-to-face meeting between their respective senior executive officers or their designated representatives to resolve such dispute. For services performed or parts sold within the United States of America, if the matter is not resolved by negotiations, either party shall have the right to pursue any legal remedy available.
16. GENERAL.
The provisions of this Contract are for the benefit of the parties hereto and not for any other party or person except as specifically provided herein.
Orders arising hereunder may be changed or amended only by written agreement signed by both FGGS and Customer, setting forth the particular changes to be made and the effect, if any, of such changes on the price and time of delivery. Customer may not cancel this order unless such cancellation is expressly agreed to in writing by FGGS. In such event, FGGS will advise Customer of the total charge for such cancellation, including any applicable cancellation fees, and Customer shall pay such charges, including, but not limited to, storage and shipment costs, costs of producing non-standard materials, costs of purchasing non-returnable materials, cancellation costs imposed on FGGS by its suppliers, and any other cost resulting from cancellation of this order by Customer which is permitted by FGGS.
5 FGGS Terms and Conditions Services and Parts
Any Work furnished by FGGS hereunder will be performed in compliance with the Fair Labor Standards Act of 1938, as amended and applicable. FGGS will comply with applicable federal, state, and local laws and regulations as of the date of any quotation which relate to (a) equal employment opportunity (including the seven paragraphs appearing in Section 202 of Executive Order 11246, as amended); (b) workers' compensation; and (c) the performance of any services in Manufacturer's facilities. Price and, if necessary, delivery will be equitably adjusted to compensate FGGS for the cost of compliance with any other laws or regulations.
The delegation or assignment by Customer of any or all of its duties or rights hereunder without FGGS's prior written consent shall be void. FGGS reserves the right to assign any portion of the Contract or work to any affiliated entity, division or subsidiary within the FGGS family.
The 16 Articles in these Terms and Conditions, including FGGS's quotation and the Customer's Purchase Order (excluding any terms and conditions contained on the Purchase Order) collectively referred to herein as the "Contract", contain the entire and only agreement between Customer and FGGS respecting the terms and conditions and supersedes and cancels all previous negotiations, agreements, commitments, representations and writings in respect thereto. No modification, amendment, rescission, waiver or other change shall be binding on FGGS unless agreed to in writing by FGGS's authorized representative.
The validity, performance, and all matters relating to the interpretation and effect of this Contract and any amendment hereof shall be exclusively governed by the law of the State of Connecticut without giving effect to any conflicts of laws or choice of law rules that would apply the law of another jurisdiction. The United Nations Convention on Contracts for the International Sale of Goods shall not apply. The invalidity, in whole or part, of any of the articles or paragraphs in these Terms and Conditions will not affect the remainder of such article or paragraph or any other article or paragraph. When used in this Contract, the terms (a) "including" and "includes" mean "including but not limited to" the specifically enumerated things, states, or actions that follow such terms, and (b) "or" means "one or the other or all" of the specifically enumerated things, states, or actions that follow such term.
The following Articles shall survive termination of this Contract: Article 1 (Warranty), Article 2 (Limitation of Liability), Article 3 (Consequential Damages), Article 4 (Indemnity), Article 6 (Patents), Article 12 (Taxes), Article 13 (Compliance with Laws), Article 14 (Reservation of Rights), Article 15 (Dispute Resolution), Article 16 (General) and any remaining payment obligations of Customer.