1. DEFINITIONS AND INTRODUCTION
1.1 Unless the context otherwise requires, in these Terms, the following terms have the meanings set out below:
“Buyer” means the firm or company so named in the Purchase Order, or if not so named, means the registered owner of the Vessel mentioned in the Purchase Order;
“Buyer Group” means the Buyer, its affiliates, its Sub-Contractors and its and their respective directors, officers, employees, agents and personnel;
“Claims” means any and all investigations, demands, claims, judgments, actions, proceedings, suits or causes of action, brought or threatened against the Buyer and/or any other member(s) of the Buyer Group;
“Embargoed Country” means any country or geographic region subject to comprehensive economic sanctions or embargoes administered by the US Department of the Treasury’s Office of Foreign Assets Control (“OFAC”), the United Kingdom (“UK”) or the European Union (“EU”), including without limitation Iran, North Korea, Russia and Syria;
“Goods” means all goods, materials, equipment, supplies, or other items (if any) specified in the Purchase Order;
“Group” means:
(a) in respect of the Buyer, the Buyer Group; and
(b) in respect of the Supplier, the Supplier Group;
“IP Rights” means copyrights and related rights, patents, utility models, trademarks, service marks, trade names, topography rights, design rights and rights in databases, domain names, rights in know-how, trade secrets and all applications or pending applications for the above in all cases, whether or not registerable in any country, and all rights and forms of protection of a similar nature or having equivalent or similar effect anywhere in the world;
“Losses” means losses (including consequential losses and loss of profit), liabilities, damages, costs (including legal costs and expenses), claims, demands, judgments, amounts paid in settlement, assessments, expenses, penalties, interest, fines, taxes and duties, including, without limitation, those incurred or arising as a result of, or in connection with, any Claim(s);
“Party” means either the Buyer or the Supplier and “Parties” means both of them;
“Purchase Order” means the purchase order issued to the Supplier by or on behalf of the Buyer requesting that the Supplier supplies Goods and/or Services and which references these Standard Terms & Conditions;
“Sanctioned Person” means, at any time, (a) any person or entity included on OFAC’s Specially Designated Nationals and Blocked Persons List, the Sectoral Sanctions Identifications List, or the Foreign Sanctions Evaders List; the EU’s Consolidated List of Sanctions Targets; the UK Consolidated List of Asset Freeze Targets and list of persons named in relation to financial and investment restrictions; or any similar list; (b) any person resident in, or entity organised under the laws of, an Embargoed Country; or (c) any person or entity majority-owned or controlled or acting on behalf of any of the foregoing;
“Services” means the services (if any) described in the Purchase Order;
“Specifications” means the specifications for the Supply (as may be set out in the Purchase Order or attached to the Purchase Order) and any variation of those specifications agreed in writing and signed by the Parties or their respective representatives;
“Sub-contractor” means a contractor, vendor, agent, or consultant selected and retained by Supplier, who is providing part of the Goods and/or Services on behalf of Supplier;
“Supply” means the supply of Goods and/or Services under a Purchase Order;
“Supplier” means the person, firm or company to whom the Purchase Order is issued;
“Supplier Group” means the Supplier, its affiliates, its Sub-Contractors and its and their respective directors, officers, employees, agents and personnel;
“Terms” means these Standard Terms & Conditions – Purchase of Good and/or Services;
“Trade Laws” means US Export Administration Regulations; the US International Traffic in Arms Regulations; the economic sanctions rules and regulations administered by OFAC as well as any relevant Executive Orders; the sanctions and export control rules and regulations administered by competent authorities in the UK or the EU, including but not limited to sanctions regimes implemented under the UK Sanctions and Anti-Money Laundering Act 2018, and EU Council Regulations on export controls, including Nos. 428/2009, 267/2012; other EU Council sanctions regulations, as implemented in EU Member States; United Nations sanctions policies; all relevant regulations made under any of the foregoing; and other applicable economic sanctions or export and import control laws; and
“Vessel” means the vessel (if any) identified in the Purchase Order.
1.2 Words denoting the singular shall include the plural and vice versa.
2. CONTRACT
2.1 The Contract is comprised of these Terms and any Purchase Order by and between Supplier and Buyer detailing the order of specific Goods and/or Services. The Contract together with the documents referred to in it, constitute the entire agreement and understanding between the Parties, of the matters dealt with in them, and supersedes all other prior oral or written agreements between them or the Parties to a Purchase Order, notwithstanding the terms of any previous agreement or arrangement.
2.2 The Purchase Order shall be deemed to be accepted on the earlier of: (a) the Supplier issuing written acceptance of the Purchase Order; or (b) any act by the Supplier consistent with fulfilling the Purchase Order, at which point, and on which date, the Contract shall come into existence.
2.3 For the avoidance of doubt, any Purchase Order placed under the Contract shall be solely governed by these Terms. No other general terms and conditions and/or other terms submitted or referred to by the Supplier when tendering or otherwise referred to by Supplier in quotations, order confirmations, correspondence or elsewhere shall form part of the Contract unless expressly agreed to in writing by Buyer.
2.4 All of these Terms shall apply to the supply of both Goods and Services except where the application to one or the other is specified.
3. SUPPLY OF GOODS
3.1 The Supplier shall supply the Goods to the Buyer in accordance with the Contract.
3.2 The Supplier warrants, represents and undertakes to the Buyer that the Goods will:
(a) correspond with their description and any applicable Specifications provided on behalf of the Buyer;
(b) be of satisfactory quality (within the meaning of the Sale of Goods Act 1979 and the Supply of Goods and Services Act 1982) will be fit for any purpose made known to the Supplier on behalf of the Buyer or held out by the Supplier, in each case expressly or by implication, and in this respect the Buyer relies on the Supplier’s skill, expertise and judgment;
(c) be free from all defects in design, materials and workmanship and remain so for 12 (twelve) months after delivery and, where applicable, installation;
(d) comply with all the requirements of this Contract (including specifications (if any)), all relevant laws and regulations, and any applicable requirements of the Vessel’s classification society;
(e) comply with all applicable statutory and regulatory requirements relating to the manufacture, labelling, packaging, storage, handling and delivery of the Goods; and
(f) be in accordance with quality assurance standard ISO 9000, or an equivalent auditable system.
3.3 Furthermore, the Supplier warrants, represents and undertakes to the Buyer that all Goods being supplied and tendered for delivery are in strict compliance with the Supplier’s original equipment manufacturers specification, drawing and quality. Supplier agrees that original equipment manufacturer’s certificate of conformity, where applicable, will be supplied to the Buyer for all Goods covered by a Purchase Order.
4. DELIVERY DATE OF GOODS
4.1 The Supplier shall deliver the Goods on the date specified in the Purchase Order unless otherwise agreed between the Buyer and the Supplier.
4.2 The Supplier shall furnish such schedules of manufacture and delivery as the Buyer may reasonably require and give notice in writing to the Buyer as soon as practicable, if such schedules are or are likely to be delayed.
5. DELIVERY LOCATION OF GOODS
5.1 The Supplier shall deliver the Goods to the delivery point specified in the Purchase Order or as otherwise instructed by the Buyer prior to delivery (the “Delivery Location”).
5.2 Delivery of the Goods shall be completed on the completion of unloading of the Goods at the Delivery Location.
5.3 If the Goods are incorrectly delivered, the Supplier will be held responsible for any additional expense incurred in delivering such Goods to the correct Delivery Location.
5.4 The Supplier shall:
(a) ensure that the Goods are properly packed and secured for export, handled and transported in such a manner as to enable them to reach the Delivery Location in good condition, undamaged and to prevent damage while in transit or storage;
(b) ensure that the delivery of the Goods is accompanied by a delivery note which shows the date of the Purchase Order, the Purchase Order number, the type and quantity of the Goods, special storage instructions (if any); and
(c) be liable for Losses (including increased freight charged) incurred by the Buyer as a result of the Goods being packed or described inappropriately or the Supplier’s failure to follow any transport instruction issued by the Buyer or specified in the Contract.
6. BUYER’S RIGHT TO REJECT GOODS
6.1 If the Supplier:
(a) delivers less than 100% of the quantity of Goods ordered, the Buyer may reject the Goods; or
(b) delivers more than 100% of the quantity of Goods ordered, the Buyer may at its sole discretion reject the Goods or the excess Goods.
6.2 The Buyer shall be entitled to reject any Goods delivered which are not in accordance with the Contract, and the Buyer shall not be deemed to have accepted any Goods until the Buyer has had a reasonable period to inspect them following delivery. The Buyer will also have the right to reject any Goods as though they had not been accepted after any latent defect in the Goods has become apparent.
6.3 Any payment by the Buyer prior to the completion of inspection shall not constitute acceptance of the Goods or waive any of the Buyer’s rights in respect of defects or non-conformities.
6.4 Any rejected Goods shall be returnable at the Supplier’s risk and expense. If the Supplier delivers more or less the quantity of Goods ordered and accepted by the Buyer, a pro rata adjustment shall be made to the amount to be invoiced and paid for the Goods.
7. SUPPLY OF SERVICES
7.1 The Supplier shall supply the Services to the Buyer in accordance with the Contract.
7.2 The Supplier shall meet any performance dates specified in the Contract or notified to the Supplier by the Buyer.
7.3 The Supplier shall:
(a) co-operate with the Buyer in all matters relating to the Services and comply with all instructions of the Buyer;
(b) perform the Services with the best care, skill and diligence with best practice in the Supplier’s industry, profession or trade;
(c) use personnel who are suitably skilled and experienced to perform tasks assigned to them, in sufficient number to ensure that the Services are fulfilled in accordance with the Contract;
(d) ensure that the Services will conform with all descriptions and specifications set out in the Specification and that the Services shall be fit for any purpose made known to the Supplier on behalf of the Buyer or held out by the Supplier, in each case expressly or by implication, and in this respect the Buyer relies on the Supplier’s skill, expertise and judgment;
(e) provide all equipment, tools and vehicles and such other items as are required to provide the Services;
(f) use the best quality goods, materials, standards and techniques, and ensure that the Services, and all goods and materials supplied and used in the Services or transferred to the Buyer, will be free from defects in workmanship, installation and design;
(g) obtain and at all times maintain all necessary licences, consents, permissions and approvals which may be required for the provision of the Services;
(h) comply with all the requirements of this Contract (including specifications (if any)), all relevant laws and regulations (including health and safety rules and regulations) and any applicable requirements of the Vessel’s classification society;
(i) not do or omit to do anything which may cause the Buyer to lose any licence, authority, consent or permission upon which it relies for the purposes of conducting its business;
(j) hold all material, equipment and tools, drawings, specifications and data (“Buyer’s Materials”) in safe custody at its own risk, maintain the Buyer’s Materials in good condition until returned to the Buyer other than in accordance with the Buyer’s written instructions and authorisation; and
(k) comply with any additional obligations and/or instructions set out in the Specification.
7.4 The Buyer will not be deemed to have accepted the Services until it has had a reasonable period to inspect them following completion of performance of the Services. The Buyer will also have the right to reject the Services as though they had not been accepted, after any latent defect in the Services has become apparent.
8. BUYER’S OBLIGATIONS
8.1 The Buyer shall provide the Supplier with such information and materials as the Supplier may reasonably request within a reasonable time to supply the Goods and/or Services.
9. DELIVERY LOCATION – SERVICES
9.1 The Supplier shall perform the Services at the delivery point specified in the Purchase Order on the date(s) specified in such Purchase Order or as otherwise instructed by the Buyer prior to delivery.
10. PASSING OF TITLE AND RISK TO BUYER
10.1 Without prejudice to Buyer’s rights and remedies herein and notwithstanding any prepayment of all or part of the price relating to the Goods, the title to and risk for the Goods shall remain with the Supplier until completion of the delivery of the Goods at the Delivery Location, whereupon title and risk in such Goods shall pass to the Buyer.
10.2 Without prejudice to Buyer’s rights and remedies herein and notwithstanding any prepayment of all or part of the Supplier’s fees, and/or other compensation or remuneration relating to the Services, risk associated with the Services including in respect of materials or work produce provided in the course of the Services shall pass to Buyer upon acceptance by the Buyer in writing of completion of the Services. The Supplier shall notify the Buyer in writing as soon as possible once Supplier considers the Services provided as completed. Without undue delay after receiving the aforesaid notice, the Buyer shall in writing either accept the Services as completed or declare that the Services are not considered completed and are not accepted and state the reason for this. For the avoidance of doubt, the Services shall not be deemed accepted, and completion will not be deemed to have taken place, unless and until the Buyer provides acceptance in writing.
11. TERMS OF PAYMENT AND SET-OFF
11.1 Payment shall be made in the manner and at the time or times agreed by the Parties.
11.2 The Buyer reserves the right to set off payments against any invoice amount which is in dispute or owed by the Supplier whether under the Contract or otherwise. Any exercise by the Buyer of its rights under this clause shall not limit or affect any other rights or remedies available to it under the Contract.
12. VALUE ADDED TAX
12.1 The Buyer certifies the Goods and/or Services which are subject to a Purchase Order referring to a Vessel are solely for use onboard an ocean-going vessel and/or are for direct export and/or are being delivered to an export warehouse for eventual export, and accordingly in all cases should be zero-rated.
13. INSURANCE
13.1 The Supplier shall have, and maintain, insurance coverage with reputable insurance companies throughout the duration of the Contract, in accordance with good international industry practices and applicable law, including, if applicable, employer’s liability (including, where applicable, off-shore employer’s liability insurance to cover personnel off-shore), public liability/third party insurance including all property risk, commercial general liability, including contractual liability, all risk cover for all Goods and/or Services provided by Supplier, professional liability, product liability, transport/cargo insurance, at Supplier’s sole expense, properly safeguarding Supplier against its liability hereunder.
13.2 The requirements set out in this clause shall be without prejudice to and shall not diminish or otherwise affect the Supplier’s obligations under the Contract (including, without limitation, the Supplier’s indemnities contained in the Contract).
13.3 The Supplier shall, upon receipt of a written request from the Buyer, promptly provide the Buyer with certificates of insurance and the Supplier shall immediately inform the Buyer of any material amendments to, cancellation or threatened cancellation of any of the Supplier’s insurance policies.
13.4 If the Supplier fails:
(a) to obtain or maintain any insurances required under this clause 13; or
(b) to provide the Buyer with certificates of insurance upon receipt of written request from the Buyer; and/or
(c) to obtain replacement insurance in respect of any insurance cancelled,
then the Buyer shall have the right, but not the obligation, to place such insurance(s) itself at the Supplier’s cost and the Supplier shall promptly reimburse the Buyer for the cost of such insurance(s).
14. VARIATIONS
14.1 The Supplier shall not alter any of the Goods or Services, except as directed in writing by Buyer; however the Buyer shall have the right, from time to time during the execution of the Contract, by notice in writing to direct Supplier to add to or omit, or otherwise vary, the Goods or, as the case may be, Services, and Supplier shall carry out such variations and be bound by the same conditions as far as applicable, as though the said variations were stated in the Contract. In the event the Supplier receives any such direction from the Buyer which would require an amendment to the contract price, the Supplier shall as soon as possible and in any event within 2 days, advise the Buyer in writing stating the amount of any such amendment to price, calculated by reference to the same pricing structure as that set out in the Contract and supported by reasonable documentation. If, in the opinion of the Supplier, any such direction from the Buyer is likely to prevent the Supplier from fulfilling any of its obligations under the Contract, the Supplier shall notify the Buyer and the Buyer shall determine whether or not the same shall be carried out and shall confirm its instructions in writing. Unless and until the Buyer confirms its instructions in writing, the Contract shall remain in full force and effect unamended by the Buyer’s direction.
15. INTELLECTUAL PROPERTY RIGHTS
15.1 In respect of the Goods and any Goods that are transferred to the Buyer as part of the Services under the Contract, the Supplier warrants that it has full and clear unencumbered title to all such items and that at the date of delivery of such items to the Buyer, it will have full and unrestricted rights to sell and transfer all such items to the Buyer.
15.2 The Supplier assigns to the Buyer all Intellectual Property Rights created by the Supplier for the purpose of and in the course of providing the Services and/or necessary for the use of the Goods.
15.3 The Buyer shall have a worldwide, royalty-free, irrevocable licence (with an unrestricted right to sublicense) to use any Intellectual Property Rights incorporated into, or necessary for the operation, repair, maintenance, inspection or replacement of, the Goods or the Services.
15.4 Without prejudice to any other term of the Contract, the Supplier shall indemnify and hold harmless each member of the Buyer Group against all Losses (including all costs arising from any Claim) incurred or sustained by the Buyer and/or such member(s) of the Buyer Group, directly or indirectly, as a result of, or in connection with:
(a) any breach of this clause;
(b) any infringement or alleged infringement of any third-party Intellectual Property Rights by any member of the Supplier Group in the supply of the Goods and/or the performance of the Services; or
(c) any infringement or alleged infringement arising from the subsequent use of the Goods or work product resulting from Services by any member of the Buyer Group or on the Vessel identified in the Purchase Order.
15.5 If the use of any such Goods, as intended by the Buyer and/or, as the case may be, the Supplier, is prohibited, the Supplier shall, at its own expense either:
(a) obtain for the Buyer the right to continue using such Goods;
(b) replace it with non-infringing Goods;
(c) with the approval of the Buyer (which may be withheld in its absolute discretion), modify it so that it becomes non-infringing; or
(d) remove such Goods and refund the full purchase price and all transportation and/or installation costs.
15.6 This clause 15 shall survive termination of the Contract.
16. FORCE MAJEURE
16.1 Neither Party shall be liable for any delay or failure in performing its obligations under the Contract if, and to the extent that, such delay or failure is directly caused by an event or circumstance beyond its reasonable control which could not have been prevented by reasonable foresight or precautions (“Force Majeure Event”). Force Majeure Events include acts of God, war, terrorism, civil unrest, epidemic, pandemic, fire, flood, earthquake, or compliance with any law or governmental order. For the avoidance of doubt, a Force Majeure Event shall not include any event or circumstance:
(a) which the affected party could have reasonably avoided or overcome by the exercise of good industry practice;
(b) relating to the affected Party’s lack of funds or inability to pay;
(c) resulting from failure or delay by any member(s) of the Supplier Group unless such failure or delay is itself caused by a Force Majeure Event;
(d) affecting only the affected Party and not generally affecting businesses of a similar nature; or
(e) which was caused by the negligence or willful misconduct of any member of the Supplier Group.
16.2 The affected Party shall:
(a) promptly (and no later than within two (2) working days) notify the other Party in writing of the occurrence and expected duration of the Force Majeure Event(s);
(b) use all reasonable endeavours to mitigate the effects of the Force Majeure Event(s), including sourcing alternative materials, labour, or transport;
(c) keep the other Party informed of progress and the steps being taken to resume performance; and
(d) promptly resume performance upon the relevant Force Majeure Event ending.
16.3 The affected Party’s obligations shall be suspended only to the extent and for the period that performance is actually prevented by the Force Majeure Event. For the avoidance of doubt, such suspension shall apply only to the specific obligations directly affected by the Force Majeure Event itself, and no suspension of obligations shall extend to consequential, subsequent, or residual delays arising after the cessation of the relevant Force Majeure Event, including delays resulting from the time required to restart operations, reallocate resources, or remedy backlogs.
16.4 If more than one Force Majeure Event occurs at the same time, or if a Force Majeure Event triggers or overlaps with another, the affected Party shall be entitled to relief under this clause only for the period during which its performance is actually prevented, hindered, or delayed, and such period shall not be extended or renewed by the concurrent or successive occurrence of additional Force Majeure Events unless such additional events independently continue to prevent performance after the cessation of the prior event.
16.5 If the Force Majeure Event(s) prevent or delay performance for a continuous period of more than 30 days, the Buyer may terminate the Contract immediately on written notice without liability.
16.6 Any advance payments for Goods and/or Services not delivered or completed in full shall be refunded to the Buyer within 14 days of termination.
16.7 The Buyer shall be under no obligation or liability to:
(a) pay any increased or additional amounts in respect of the Goods and/or Services (whether by way of an increase in price or otherwise) as a result of, or in connection with, the occurrence or subsistence of any Force Majeure Event(s); and/or
(b) compensate the Supplier for any costs, losses (including, for the avoidance of doubt, consequential losses or loss of profit), damages or expenses, directly or indirectly, arising as a result of, or in connection with, the occurrence or subsistence of any Force Majeure Event(s).
16.8 Nothing in this clause shall excuse or otherwise relieve the Supplier from any obligation to deliver Goods and/or Services which are not directly affected by the Force Majeure Event(s).
17. PROGRESS AND INSPECTION – GOODS
17.1 The Buyer or any person authorised by the Buyer shall have the right to inspect and test the Goods at any time prior to the delivery of the Goods. If, following such inspection and/or, as the case may be, testing, the Buyer considers that the Goods do not conform or unlikely to conform to the provisions of the Contract, the Buyer shall inform the Supplier and the Supplier shall, at its own cost, immediately take all action as is necessary in order to ensure compliance with the Contract.
17.2 Furthermore, notwithstanding any inspection and/or testing undertaken on behalf of the Buyer and any approval or acceptance given on behalf of the Buyer shall not relieve the Supplier from any obligation under the Contract and the Supplier shall remain wholly responsible for the Goods and such inspection and/or testing shall not affect the Supplier’s obligations under the Contract.
17.3 The Buyer shall have the right to conduct further inspections and testing of the Goods following the Supplier’s completion of its remedial actions.
18. PROGRESS AND INSPECTION – SERVICES
18.1 The Supplier shall keep the Buyer fully informed of the progress of the Services and shall provide such progress reports, data, and other information as the Buyer may reasonably require, in the form and at the intervals reasonably specified by the Buyer.
18.2 The Buyer, or any person authorised by the Buyer, shall have the right at all reasonable times and on reasonable notice to inspect and examine the performance of the Services, including any premises, equipment, systems, processes, or records used in connection with the Services. The Supplier shall provide full cooperation and access for such inspections and shall ensure that its Sub-contractors and/or agents do the same.
18.3 The Supplier shall attend progress meetings with the Buyer or its representatives at such times and places as the Buyer may reasonably require. At each meeting, the Supplier shall provide up-to-date information on progress, problems encountered, and planned actions.
18.4 If any inspection or testing by the Buyer indicates that the Services (or any part of them) do not comply with the Contract, the Buyer may notify the Supplier accordingly. The Supplier shall, at its own cost and without delay, take all steps necessary to remedy the deficiency to the Buyer’s satisfaction.
18.5 Furthermore, notwithstanding any inspection and/or testing undertaken on behalf of the Buyer and any approval or acceptance given on behalf the Buyer shall not relieve the Supplier from any obligation under the Contract and the Supplier shall remain wholly responsible for the Services and such inspection and/or testing shall not affect the Supplier’s obligations under the Contract.
19. BUYER’S RIGHTS IN SPECIFICATIONS, PLANS, DRAWINGS, PATTERNS, ETC.
19.1 Any specifications, plans, drawings, patterns or designs supplied by the Buyer to the Supplier in connection with the Contract shall remain the property of Buyer, shall be private and confidential to the Buyer and shall not, without the consent in writing of Buyer, be published or disclosed to any third party, or made use of by Supplier except for the purpose of implementing the Contract.
20. RESPONSIBILITY FOR INFORMATION
20.1 The Supplier shall be responsible for any errors or omissions in any drawings, calculations, packing details or other particulars supplied by it, regardless of whether such information has been approved by the Buyer.
21. ASSIGNMENT AND SUB-CONTRACTING
21.1 The Supplier shall not be entitled to assign, or otherwise transfer, any rights or obligations under the Contract or any Purchase Order, without the prior written consent of the Buyer. Any such attempted assignment or transfer shall be void.
21.2 The Supplier shall be entitled to use Sub-Contractors in the delivery of the Goods and/or performance of the Services provided that if the Supplier uses Sub-Contractors, the Supplier shall be responsible and remain liable in full for:
(a) the due performance of their duties under, and compliance with the terms of, the Contract,
(b) any and all Goods supplied by its Sub-Contractors (including any sub-Sub-Contractors),
(c) all work done by its Sub-Contractors (including any sub-Sub-Contractors) and/or
(d) any and all acts, defaults and omissions of its Sub-Contractors (including any sub-Sub-Contractors).
21.3 The Buyer reserves the right, at its sole discretion, to require the Supplier to replace any Sub-Contractor that, in the Buyer’s opinion:
(a) is performing unsatisfactorily;
(b) fails to comply with any applicable laws, regulations, or terms of the Contract;
(c) causes delay or potential risk to the timely completion or quality of the work; or
(d) otherwise acts in a manner inconsistent with the interests of the Buyer.
21.4 Upon receipt of the Buyer’s written notice requiring removal or replacement, the Supplier shall immediately remove the Sub-Contractor and, within five (5) days (or such shorter period as the Buyer may specify), propose a qualified replacement for the Buyer’s written approval. The Supplier shall ensure full continuity of performance and bear all costs, losses, or delays resulting from such replacement.
21.5 If the Supplier fails to propose a satisfactory replacement within the time specified, or if the Buyer rejects any proposed replacement, the Buyer may, at its option and without prejudice to any other rights or remedies:
(a) appoint a replacement Sub-Contractor directly and deduct all related costs from any amounts due to the Supplier; or
(b) suspend all or part of the work until an acceptable replacement is in place;
(c) terminate the Contract, in whole or in part, for cause and recover all resulting damages from the Supplier.
21.6 The Supplier shall remain fully responsible for the acts, omissions, and performance of all Sub-Contractors, regardless of any removal or replacement direction by the Buyer.
21.7 The Supplier, shall upon request by the Buyer, provide a copy of each contract, agreement or order relating to the Goods and/or Services entered into between the Supplier and its Sub-Contractor(s).
22. CONFIDENTIALITY
22.1 A Party (the “Receiving Party”) shall keep all technical or commercial know how, specifications; inventions; processes; reports or initiatives which have been disclosed to the Receiving Party by the other Party or its Group (the “Disclosing Party”) and any other information concerning the Disclosing Party’s Group business, its products and services which the Receiving Party may obtain. The Receiving Party shall only disclose such confidential information to those of its Group who need to know it for the purpose of discharging the Receiving Party’s obligations under the Contract, and shall ensure that such members of its Group comply with the obligations set out in the Contract as though they were a Party to the Contract. The Receiving Party may also disclose such of the Disclosing Party’s Group confidential information as is required to be disclosed by law, any governmental or regulatory authority or by a court of competent jurisdiction provided that prior to any such disclosure, to the extent legally permissible, the Receiving Party shall promptly provide notice of the required disclosure to the Disclosing Party. Notwithstanding anything in this clause, the Buyer may share Confidential Information in the ordinary course of its business, including with any member of the Buyer Group and with any vessel or vessel-related personnel involved in the performance, operation, repair or management of the Goods and/or Services.
22.2 Without prejudice to any other terms of the Contract, the Supplier shall indemnify and hold harmless the Buyer and each other member of the Buyer Group against all Losses incurred or sustained by the Buyer and/or such member(s) of the Buyer Group, directly or indirectly, as a result of, in connection with, or relating to, any violation(s) of this clause.
22.3 This clause 22 shall survive termination of the Contract.
23. FREE-ISSUE MATERIALS
23.1 Where the Buyer for the purposes of the Contract issues materials free of charge to the Supplier, such materials shall be and remain the property of Buyer. The Supplier shall maintain all such materials in good order and condition subject, in the case of tooling patterns and the like, to fair wear and tear. The Supplier shall only use such materials in connection with the Contract. Any surplus materials shall be disposed of at Buyer’s discretion. Waste of such materials arising from bad workmanship or negligence of Supplier shall be made good at the Supplier’s expense. Without prejudice to any other of the rights of the Buyer, the Supplier shall deliver up such materials whether further processed or not to Buyer on demand.
24. WARRANTY AND INDEMNITY
24.1 The Supplier warrants and undertakes that:
(a) the Goods shall be new (unless otherwise specified in the Purchase Order relating to such Goods), of good quality and workmanship, free from defects and fit for the intended purposes (including complying with any applicable regulations and Specifications) and comply with the requirements set out in the Contract;
(b) the Services shall be delivered in accordance with market standards and good professional practices or such other level of standards agreed between the Parties, in accordance with the Specification(s), shall be free from errors, omissions, defects or any other non-conformities and comply with the requirements set out in the Contract,
for 12 (twelve) months from the time the Goods are taken into use, or from the date of acceptance of Services by the Buyer, whichever is later.
24.2 If Supplier is notified about a breach of warranty claim, Supplier shall, upon written request, promptly perform all corrective measures which are necessary to remedy any defects arising from any breach of warranty. All costs and expenses, incidental to remedying defects, will be for the sole account of Supplier.
24.3 If Buyer decides that the timing or impact of the corrective measures will be prejudicial to its interests, or if Supplier fails to promptly correct any defective Goods and/or Services in accordance with its obligations, the Buyer may, subject to informing the Supplier in writing and allowing 48 (forty eight) hours for the Supplier to propose an alternative solution acceptable to Buyer, undertake the Supplier’s responsibilities for such corrective measures, which may include engaging a third party to carry out remedial work, and may either deduct from any amount due to the Supplier, or recover from Supplier, all costs, incurred by Buyer, in undertaking the corrective measures, subject to production of appropriate receipts and evidence.
24.4 Following Supplier’s remedy of a defect and/or re-delivery and/or replacement and/or re-performed Services, a new warranty period of the same length as the original warranty period shall apply, provided that it shall not extend beyond 24 (twenty-four) months from the commencement of the original warranty period.
24.5 The Supplier shall indemnify and hold harmless the Buyer and each other member of the Buyer Group against all Losses incurred or sustained by the Buyer and/or such member(s) of the Buyer Group, directly or indirectly, arising in connection with, or as a result of:
(a) damage to, and/or loss of, the Goods;
(b) breach of this Contract or any law by any member of the Supplier Group in the course of, or in connection with, the performance of the Supplier’s obligations under the Contract; and/or
(c) any negligence, fraud, misconduct or omission by any member of the Supplier Group, in the course of, or in connection with, the performance of its obligations under the Contract.
24.6 The Supplier shall indemnify and hold harmless the Buyer and each other member of the Buyer Group against all Losses incurred or sustained by the Buyer and/or such member(s) of the Buyer Group, directly or indirectly, arising in respect of, or in connection with, any Claims arising out of, or in connection with, the performance of the Contract:
(a) caused (directly or indirectly) by any breach of the Contract, negligence, misconduct, fraud or breach of duty (statutory, tortious or otherwise) by the Supplier or any person within the Supplier Group;
(b) in respect of loss of, damage to, or pollution from the property, Supplier vessel or Supplier Materials of the Supplier Group;
(c) in respect of any death, injury or disease of any person within the Supplier Group;
(d) in respect of any death, injury or disease of any person within the Buyer and/or any other member of the Buyer Group caused (directly or indirectly) by any breach of the Contract, negligence, misconduct, fraud, or breach of duty (statutory, tortious or otherwise) by the Supplier or any person within the Supplier Group; or
(e) made against the Buyer and/or any other member of the Buyer Group by a third party arising out of or in connection with the supply of the Goods or the Services.
24.7 This clause 24 shall survive termination of the Contract.
25. BUSINESS ETHICS
25.1 In carrying out its obligations under the Contract, the Supplier shall comply with and ensure that the Supplier Group shall comply with all applicable laws, rules, regulations, conventions, directives or ordinances, in force from time to time, which are applicable to the delivery of the Goods and/or performance of the Services and/or relate to the provision, licensing, approval or certification of the Goods, including without limitation, Trade Laws, occupational health and safety, environmental matters, wages, working hours and conditions of employment, the International Bill of Human Rights.
25.2 The Supplier represents and warrants that neither it nor any member of the Supplier Group:
(a) is in breach of any bribery or corruption under any applicable corruption laws;
(b) is in breach of any applicable anti-money laundering laws; and
(c) has any involvement with any slavery, human trafficking or child labour.
25.3 Without prejudice to any other term of the Contract, the Supplier shall indemnify and hold harmless the Buyer and each other member of the Buyer Group against all Losses incurred or sustained by the Buyer and/or such member(s) of the Buyer Group, directly or indirectly, as a result of, or relating to, any breach(es) of this clause.
25.4 The Supplier shall, upon request by the Buyer in writing, promptly provide any information which the Buyer may reasonably require in order to monitor its compliance with this clause. In particular and without limitation, a director or other duly authorised representative of the Supplier with direct responsibility for the Contract shall certify in writing to the Buyer on an annual basis its full compliance with this clause during the preceding year.
25.5 The Supplier shall notify the Buyer immediately in writing upon becoming aware of, or suspecting:
(a) any failure to comply with any provisions of this clause; and
(b) any extortive solicitation, demand or other request for anything of value, by or on behalf of any person relating to Goods / Services or the Contract or its subject matter.
25.6 Any failure by the Supplier to comply with any provision of this clause shall constitute a material breach of the Contract. In the event of a breach or suspected breach of this clause, such determination to be at the sole discretion of the Buyer, the Buyer shall be entitled to suspend performance of its obligations under the Contract and/or terminate the Contract, in each case, with immediate effect.
25.7 This clause 25 shall survive termination of the Contract.
26. SUPPLIER’S OBLIGATIONS AND WARRANTIES
26.1 The Supplier shall ensure that at all times it has and maintains all the licences, permissions, authorisations, consent and permits that it needs to carry out its obligations under the Contract in respect of the supply of the Goods and/or Services.
26.2 The Supplier must ensure that every item of plant, machinery or vehicle used by the Supplier in performing the Contract is licensed, registered, equipped, maintained, and used so that it does not endanger the health and safety of any person, cause damage to any property, or cause environmental harm, damage or nuisance to the public.
26.3 The Supplier represents and warrants that it and each other member of the Supplier Group shall comply with:
(a) Trade Laws in all respects related directly or indirectly to the supply/performance of the Goods / Services or this Contract and undertakes that they will not, through any act or omission place the Buyer in violation of Trade Laws; and
(b) all other rules and regulations including those of the territories where Goods and/or Services are to be delivered / performed.
26.4 Without prejudice to any other term of the Contract, the Supplier shall indemnify and hold harmless the Buyer Group against all Losses suffered by them (or any of them), directly or indirectly, the Buyer and each other member of the Buyer Group against all Losses incurred or sustained by the Buyer and/or such member(s) of the Buyer Group, directly or indirectly, as a result of, or relating to, any breach(es) of this clause, including any penalties or costs associated with government investigations or enforcement actions under Trade Laws.
26.5 The Supplier represents and warrants that neither it nor any other member of the Supplier Group is a Sanctioned Person.
26.6 Any breach, known future conduct that would likely cause a breach (as determined by the Buyer in its discretion), or a change to Trade Laws which makes continued performance under the Contract or the supply of Goods or performance of the Services impermissible, entitles the Buyer at its absolute discretion to immediately terminate the supply of Goods and/or the performance of the Services and/or the Contract.
26.7 This clause 26 shall survive termination of the Contract.
27. TERMINATION
27.1 Without limiting the rights of the Buyer’s rights or remedies, the Buyer may terminate the Contract with immediate effect by giving written notice (such written notice may be given by email) if:
(a) the Supplier becomes insolvent; or
(b) an order is made or resolution passed for the winding up, dissolution, liquidation or bankruptcy of the Supplier (otherwise than for the purpose of reconstruction or amalgamation); or
(c) a receiver, administrator or similar officer is appointed in respect of the Supplier; or
(d) the Supplier suspends payment, ceases to carry on business or makes a special composition or arrangement with its creditors; or
(e) in respect of the supply of Services, there is a material breach by the Supplier of the Contract and (if capable of remedy) the Supplier has failed to remedy such breach within 5 days after being notified in writing to do so; or
(f) late delivery of the Goods and/or performance or if the Supplier advises the Buyer that there will be a delay in the delivery of the Goods and/or performance of the Services;
(g) for convenience at any time (i) in the case of Goods, prior to the delivery of Goods or, (ii) in the case of Services, at any time prior to the commencement of the performance of the Services. In the event of termination for convenience by the Buyer, the Supplier shall not be entitled to any compensation, loss of profit, loss of opportunity, or consequential damages of any kind.
27.2 Termination of the Contract, however arising, shall not affect any of the Parties’ rights and remedies that have accrued as at termination.
27.3 Any release, indemnity or any obligation of confidence under the Contract is independent and survives termination of the Contract. Any other term and condition that by its nature is intended to survive termination of the Contract survives termination of the Contract unaffected by anything that might have the effect of prejudicing, releasing, discharging or affecting in any other way the liability of the Party giving the indemnity.
27.4 This clause 27 shall survive termination of the Contract.
28. BUYER’S REMEDIES
28.1 If the Supplier materially fails to deliver the Goods and/or perform the Services by the applicable date, the Buyer shall, without limiting its other rights or remedies, have one or more of the following rights:
(a) to terminate the Contract with immediate effect by giving written notice (which written notice may be sent by email);
(b) to refuse to accept any subsequent delivery of the Goods and/or performance of the Services which the Supplier attempts to make;
(c) to recover from the Supplier any additional costs incurred by the Buyer in obtaining substitute goods and/or services from a third party;
(d) where the Buyer has paid in advance for Goods which have not been delivered by the Supplier and/or Services that have not been provided by the Supplier, to have such sums refunded by the Supplier; and
(e) to claim damages for any additional costs, losses or expenses incurred by the Buyer which are in any way attributable to the Supplier’s failure to meet such dates.
28.2 If the Supplier has delivered Goods that do not comply with the undertakings set out in the Contract, then, without limiting its other rights or remedies, the Buyer shall have one or more of the following rights, whether or not it has accepted the Goods:
(a) to reject the Goods (in whole or in part) whether or not title has passed and to return them to the Supplier at the Supplier’s own risk and expenses;
(b) to require the Supplier to repair or replace the Goods, or to provide a full refund of the price of the rejected Goods (if paid);
(c) to refuse to accept any subsequent delivery of the Goods which the Supplier attempts to make and require the Supplier to provide a full refund of the price of such Goods (if paid);
(d) to recover from the Supplier any additional expenditure incurred by the Buyer in obtaining substitute goods from a third party; and
(e) to claim damages for any additional costs, losses or expenses incurred by the Buyer arising from the Supplier’s failure to supply Goods in accordance with the terms of the Contract.
28.3 These Terms shall extend to any substituted or remedial services and/or repaired or replacement Goods supplied by the Supplier.
28.4 The Buyer’s rights under the Contract are in addition to its rights and remedies implied by statute and common law.
28.5 This clause 28 shall survive termination of the Contract.
29. MISCELLANEOUS
29.1 If any provision or part of a provision of the Contract (including any Purchase Order) is held by an arbitral tribunal appointed under the Contract or any court of competent jurisdiction to be or pursuant to any applicable law becomes invalid, illegal or unenforceable for any reason, such provision shall be severed from the Contract and the remainder of the provisions hereof shall continue in full force and effect as if the invalid, illegal or unenforceable provision or part of a provision had been eliminated from the Contract.
29.2 Any member of the Buyer Group may enforce the terms of the Contract against the Supplier, subject to, and in accordance with, the provisions of the Contract and the Contracts (Rights of Third Parties) Act 1999.
29.3 Furthermore, in the event of Buyer selling, or transferring the Goods and/or Services and/or the Vessel to which the Goods and/or Services were delivered to any third party, Buyer shall be entitled to assign the rights and benefits of existing warranties and other representations and covenants hereunder in favour of any such third-party buyer, upon notice to the Supplier. Except as expressly provided herein, no term of the Contract is intended to confer a benefit on or to be enforceable by any person who is not a Party to the Contract.
29.4 The failure or delay of a Party to insist upon performance of any provision herein, or part hereof, or a Purchase Order, or the failure or delay of a Party to exercise any right or remedy, to which it is entitled, shall not constitute a waiver thereof, and shall not cause a diminution of the obligations created by the Contract or Purchase Order. Furthermore, a waiver of any breach of the Contract or Purchase Order by a Party shall not constitute a waiver of any other breach (of the same term or of any other term) of the Contract or Purchase Order.
29.5 The Supplier shall not permit nor suffer any lien to be created on the Vessel as a consequence of its work or that of its Sub-Contractors.
29.6 This clause 29 shall survive termination of the Contract.
30. NOTICES
30.1 Any notice given to a Party in connection with the Contract shall be by email and/or post.
30.2 Any notice shall take effect on receipt by the other party and shall be deemed to have been received:
(a) if sent by email, on the day of transmission; and
(b) if posted or delivered by hand, on the day of delivery.
30.3 The provisions of this clause shall not apply to the service of any proceedings or other documents in any legal action.
31. AGENCY
31.1 The Supplier agrees and acknowledges that:
(a) Contships Management Inc. is acting as agent only for and on behalf of the Buyer and assumes no liability or responsibility for the obligations of the Buyer and is not responsible for any failure of the Buyer to fulfil its obligations under the Contract notwithstanding any rule of law to the contrary;
(b) Contships Management Inc. shall not be liable for any amounts due under the Contract; and
(c) the Supplier shall only have recourse to the Buyer in respect of any amounts due and payable under the Contract and/or any invoice issued in respect of any Goods and/or Services to be supplied by the Supplier pursuant to the terms of the Contract.
31.2 This clause 31 shall survive termination of the Contract.
32. GOVERNING LAW AND ARBITRATION
32.1 The Contract, and any dispute or claim arising out of or in connection with this Contract (including any non-contractual disputes or claims) shall be governed by and construed in accordance with the laws of England and Wales, and any dispute arising out of or in connection with the Contract shall be referred to arbitration in London in accordance with the Arbitration Act 1996 or any statutory modification or re-enactment thereof for the time being in force, save to the extent necessary to give effect to the provisions of this clause.
32.2 The seat of arbitration shall be London and the arbitration shall be conducted in accordance with the London Maritime Arbitrators’ Association (LMAA) Terms current at the time when the arbitration is commenced.
32.3 Save as provided in clause 32.4, the reference shall be to three arbitrators. A Party wishing to refer a dispute to arbitration shall appoint its arbitrator and send notice of such appointment in writing to the other Party requiring the other Party to appoint its own arbitrator within fourteen (14) calendar days of that notice and stating that it will appoint its arbitrator as sole arbitrator unless the other party appoints its own arbitrator and gives notice that it has done so within the fourteen (14) days specified. If the other Party does not appoint its own arbitrator and give notice that it has done so within the fourteen (14) days specified, the Party referring a dispute to arbitration may, without the requirement of any further prior notice to the other Party, appoint its arbitrator as sole arbitrator and shall advise the other party accordingly. The award of the sole arbitrator shall be binding on both Parties as if he had been appointed by agreement. Nothing herein shall prevent the Parties agreeing in writing to vary these provisions to provide for the appointment of a sole arbitrator.
32.4 In cases where neither the claim nor any counterclaim exceeds the sum of US$100,000 (or such other sum as the parties may agree) the arbitration shall be conducted in accordance with the LMAA Small Claims Procedure current at the time when the arbitration proceedings are commenced.
32.5 Any claim brought by a third party pursuant to clause 29 shall be resolved by arbitration in accordance with this clause 32. In the event that there are disputes between more than two parties to this Agreement, then the Supplier may appoint one arbitrator and the members of the Buyer Group that are a party to the arbitration may jointly appoint one arbitrator.
32.6 Notwithstanding anything in this clause, the Buyer shall be entitled, at any time, to apply to any court of competent jurisdiction for interim or conservatory measures (including, without limitation, injunctions, freezing orders, or orders for security for its claims against the Supplier), and any such application shall not be deemed incompatible with, or a waiver of, the agreement to arbitrate.
32.7 This clause 32 shall survive termination of the Contract.