4_OO-ALC_PA_Template_(2013).docx

Partnership Agreement Template

This MSWord template is designed to be used by all Air Logistics Complexes for the purpose of creating partnership agreements related to depot-level maintenance. Some portions of the template are mandatory use, designed either establish a consistent format or include information that is HQ AFMC-approved. The up-front material in this document is intended to describe the template’s use and should be removed prior to final use.

Legend The format of this document is mandatory. All major sections, headings and paragraphs will be included. Specific content may be altered as follows;

Content that is mandatory, to be included word-for-word, is written in normal blue.

Content that is recommended is written in normal black.

Should additional Articles be required to detail topics specific to the partnership not anticipated by this template, they shall be added at the end of the document so as not to interfere with the existing template Articles and their order.

Should additional information be required to detail existing template Articles, sub-articles may be added as required following the last instance of any existing sub-articles so as not to interfere with the existing template Article and sub-article order.

NOTE: THIS PAGE MUST BE DELETED, AND ENSURE TEXT THROUGHOUT DOCUMENT IS BLACK PRIOR TO SIGNING

FOR OFFICIAL USE ONLY // REL TO

SPA# AA-ALC-XYZ-05-001

Partnership Agreement between <ABC Company> and Ogden Air Logistics Complex

Insert ABC Company Logo here, if applicable, if not delete

XX Month Year

FOR OFFICIAL USE ONLY // REL TO

PA# OO-ALC-XYZ-13-001

Government Competition Sensitive. Releasable only to USAF and ABC Company

OO-ALC and ABC Company Partnership Agreement

IN WITNESS WHEREOF, this Partnership Agreement shall be effective when executed by a duly authorized representative of each Party on the last date indicated below.

H. BRENT BAKER, SR., Maj Gen, USAF Commander Ogden Air Logistics Complex

Date

Name Title <ABC Company>

Date

Partnership Agreement between <ABC Company> and Ogden Air Logistics Complex

Government Competition Sensitive. Releasable only to USAF and ABC Company

ARTICLE 1 –PARTNERSHIP AGREEMENT AND OBJECTIVES

1.1 Authorities: Implementation Agreements (IAs) pursuant to this Partnership Agreement (PA or “Agreement”) may be issued in furtherance of requirements arising under one or more of the following statutory/regulatory authorities: 10 USC §2474, 10 USC §2563, 10 USC §2208(j), 10 USC §2539b, 22 USC §2770, 10 USC §2667, DoDI 4151.21, AFI 63-101. Property handling requirements and disposition shall be in accordance with the provisions of Federal Acquisition Regulation (FAR) PART 45. Related statutory provisions relevant to depot maintenance partnerships include 10 USC §2464 and 10 USC §2466.

1.2 Background: To ensure compliance with statutory requirements, support Source of Repair Assignment (SORA) decisions, and in recognition of evolving Air Logistics Complex capabilities, the United States Air Force has encouraged the <ABC Company> to engage in this PA with organic depots for sustainment of various weapon system workloads. This PA supports both Air Force core capability decisions and the objective to integrate Government/Contractor sustainment activities via public-private partnering arrangements to improve weapon system availability, training, and reduce cost.

1.3 Agreement: This PA is a public-private agreement between <ABC Company> and the United States Air Force, acting through the Ogden Air Logistics Complex (OOALC). Collectively, hereafter, all signatories to this Agreement shall be referred to as the “Parties”. Neither this PA, nor subsequent IAs executed under this PA, will be incorporated into any existing Air Force contracts. Such Air Force contracts that relate to or are supported by this PA may include a special clause (normally in section H) to acknowledge existence of this PA and subsequent IAs as a means of furthering the objectives of the Air Force contract. The Parties are committed to close and continuing cooperation, mutual support through shared information and expertise and dedication of skills and resources through continuous innovation and process improvement to faithfully execute their responsibilities under this PA. The Parties intend for this partnering relationship to successfully integrate efforts to continuously improve support of the Air Force weapon systems.

1.4 Purpose: This PA is the foundation for future IAs and provides overarching terms and conditions for a longterm, publicprivate partnering approach. As such, this PA is written to allow implementation for workshare, direct sales, leasing activity and other implementation methodologies as to be determined by the Parties in future IAs or other agreements. Upon concurrence of the parties, and in keeping with Article 14 of this Agreement, this document may be amended to permit the flexibility needed to accomplish the intent of this Agreement.

1.5 Goals: The shared goals of this PA are to:

a) Improve the efficiency and effectiveness of operations at the Centers of Industrial and Technical Excellence (CITE)

b) Improve the support provided by the CITEs for the armed forces user of the services of the CITEs

c) Enhance readiness by reducing the time that it takes to repair equipment

d) Sustain a positive return on investment

e) Leverage opportunities for future business partnerships

f) Provide more responsive, timely, and reliable support to warfighter

g) Sustain parts availability, reduce repair cycle times, enhance readiness

h) Sustain the Core capabilities of the ALC

i) Reduce the cost of DoD parts and services produced or maintained at an ALC

j) Reduce the DoD cost of ownership, in operations and maintenance, and environmental remediation

k) Improve the use of available organic capability, facilities and equipment

l) Leverage private sector investments to re-capitalize depot maintenance activities

m) Enhance the industrial base to improve and sustain manufacturing and repair capabilities, both organic and private

n) Introduce improved business practices and updated technology to DoD maintenance operations and products

o) Improve Air Force 50-50/Core posture

p) Foster cooperation between the OO-ALC and <ABC Company>

q) Identify and/or develop technology for use by the Parties

r) Facilitate innovation and transformation by identifying potential projects and target areas for improvement and opportunities

s) Leverage the synergy created by public and private capabilities and collaboration

t) Enhance the Parties' business vitality by providing additional business opportunities

u) Cooperatively develop IAs to support these goals and objectives

1.6 Cooperative Activities: The following is a non-exclusive list of potential cooperative activities and services.

a) New manufacturing

b) Repair

c) Weapon System modifications and upgrades

d) Supply Chain Management

e) Engineering

f) Research and Development

g) Software Engineering

h) Data design and development of technical orders and drawings

i) Technology Infusion

j) Test and Evaluation

k) Calibration

l) Management and Process Improvement

m) Workforce Development

n) Training

o) Infrastructure investment

p) Strategic Planning and Forecasting

ARTICLE 2 – LIMITATIONS AND ASSUMPTIONS

2.1 Organizational Relationship: This PA does not constitute a commitment regarding any procurement, program, solicitation, request for proposal and/or business activity. This PA neither constitutes nor creates a joint venture, a partnership under state law, or formal business organization of any kind wherein two or more parties share profits and losses and either party can bind the other party. Nor does it create a contract to perform work, or a subcontract to perform work, among or between the Parties or any other enforceable contractual relationship between the parties until such agreement incorporated by reference in subsequent IAs.

2.1.1 Exclusivity: Nothing in this agreement shall be deemed to create an exclusive relationship between the Parties except for work that becomes part of an IA, or preclude the Parties from entering into other partnering arrangements. All industry partners that may eventually enter into a partnership agreement with the OO-ALC will receive equal referral considerations from the Government activities involved. The Agreement will not preclude the OO-ALC’s ability, without consequence, to approach DoD buyers and program managers with alternative approaches that may be determined in the best interest of the Government. The OO-ALC reserves the right of refusal to submit an offer in response to any request the <ABC Company> may submit to the OO-ALC under this Agreement.

2.2 Resources: Each party will bear all costs, risks and liabilities incurred by it in the development, submission and maintenance of this Agreement.

2.3 Commitments: The <ABC Company> and the OO-ALC shall remain as independent entities at all times, and no Party shall act as an agent for the other. Nothing in this PA shall grant, to either party, the right to make commitments of any kind for or on behalf of the other party without the prior written consent of the other party.

2.4 Financial: The creation of (or signature to) this PA does not involve the obligation of funds. Details concerning funding and funding procedures for public and private sector work will be included in IAs under this PA.

2.5 Buying Supplies or Services:

2.5.1 The <ABC Company> may provide services, supplies or equipment to support work completion by the OO-ALC at either no charge or for “in-kind” compensation. “In-kind” compensation would apply only to a lease for facility and/or equipment use.

2.5.2 If OO-ALC is required to purchase supplies or services, OO-ALC must do so using contracting procedures under the Federal Acquisition Regulations and Competition in Contracting Act. Purchases cannot be accomplished directly under this Agreement.

2.6 Leases as Part of Agreements: Facility and equipment leases associated with this PA and any IAs must comply with the specific provisions detailed within the statutory language under which the lease is accomplished.

2.7 Governing Law: This PA shall be governed and interpreted only in accordance with United States Federal Law, Air Force Instructions and applicable DoD, Air Force, and AFMC written policies with no consideration given to its conflict of laws or rules, regardless of the place of execution or performance of this PA.

2.7.1 Compliance with 10 USC §2464 and §2466: All work accomplished under this PA and any subsequent IAs shall not interfere with Government compliance of core workload and percentage limitation requirements.

2.7.2 Compliance with Export Laws: Information exchanged under this Agreement may be subject to United States export control laws and regulations under the Arms Export Control Act (AECA) (22 USC § 2778). The <ABC Company> is solely responsible for complying with all applicable United States export control laws and regulations for information subject to the export control laws and regulations which would include obtaining an export license. Notwithstanding any other clause in this Agreement, this Agreement does not in any way authorize the export of any defense articles or defense services (including information or technical data) nor does it in any way authorize or approve an exemption to the export licensing requirements of the International Traffic in Arms Regulation (ITAR). Policy implementing the AECA requires that the Department of the Air Force be aware of any workload related to this Agreement that may implicate United States export control laws.

2.8 Flow Down: Federal Acquisition Regulations (FAR) and Defense Federal Acquisition Regulation Supplements (DFARS) flow down clauses from any Government contract that the <ABC Company> may hold for which these supplies or services may be needed do not apply to the OO-ALC, a public entity.

2.9 Waiver and Severability: Any action or inaction by the Parties or the failure of the Parties, on any occasion, to enforce any right or provision of any IA adopted under this PA shall not be construed to be a waiver by the Party of its rights hereunder or thereunder, and shall not prevent the Party from enforcing such provision or right on any future occasion. A determination that any portion of an IA issued hereunder is unenforceable or invalid shall not affect the enforceability or validity of any of the remaining portions of the IA. In the event that any part, term, or provision of an IA issued hereunder, is determined unenforceable, invalid, or in violation of applicable law or regulation, the Parties agree to include a replacement provision, construed to accomplish its originally intended effect that does not violate such law or regulation.

2.10 Classified Information: To the extent the obligations of the Parties hereunder involve access to security information, classified U.S. Government “Confidential” or higher, the provisions of applicable Government regulations and the Program Security Classification Guide attached to the contract shall apply.

2.11 Technical Data Responsibility: The OO-ALC shall be responsible for using the specified versions of all technical data, work scopes and engineering deviations to perform work as supplied by the contractor. The OO-ALC shall not be responsible for the technical accuracy of the data provided.

2.11.1 The <ABC Company> shall be responsible for accuracy of all commercial technical data, work scopes and engineering deviations to perform work supplied to the OO-ALC. The <ABC Company> shall be responsible to specify the version of technical data to be used for each tasking, regardless of whether the <ABC Company> or the Weapon System Program Office is maintaining configuration control of technical data.

ARTICLE 3 – TERM AND TERMINATION

1.1 Term: The term of this PA begins upon execution of the PA. The intended term of this PA is until the goals, purposes, and use are completed. This PA may be terminated upon the mutual agreement of the Parties in writing.

1.2 Terminations: As long as there are any executory IAs issued hereunder, neither Party has a unilateral right to terminate this PA (except as detailed in paragraph(s) 3.2.1, 3.2.2, 3.2.3 below). If there are no executory IAs hereunder, either party may unilaterally terminate this Agreement at its sole discretion with 30 days advance written notice to the other Party.

1.2.1 Public Exigency and Mission Priority: The OO-ALC/CC may, upon the existence of a public exigency or mission priority, direct the immediate termination of work being accomplished at the OO-ALC. For Core workloads, removal of work is subject to the approval of the appropriate Air Force Government authorities. The Parties will work together to determine potential remedies, with the goal of returning to the objectives set forth in this PA.

1.2.1.1 Relief Under Agreements With an Air Force Prime Contract: Such occurrence shall be treated as a unilateral change by the Government. Nothing in this agreement shall be interpreted as a waiver by <ABC Company> of its contractual rights under a Government prime contract, including but not limited to equitable relief under the Changes clause and any applicable clause in Section H of such contract that recognizes the status of the Air Logistics Complex(s) as a provider of government-furnished supplies and services. Any requests for equitable adjustment or relief from obligation to perform in consequence of Government termination of OO-ALC partnering workload shall be presented through the cognizant contracting officer for the prime contract.

1.2.1.2 Relief Under Agreements Without an Air Force Prime Contract: If the OO-ALC believes that it will not be able to meet the requirements under an IA due to public exigency or mission priority changes, the OO-ALC agrees to promptly inform the <ABC Company>. The OO-ALC shall be provided schedule and cost relief from the consequences thereof. In this event, the <ABC Company> has the option to remove work pursuant to the termination.

1.2.2 In Cases Where Government Retains Right to Unilaterally Terminate: The <ABC Company> agrees that the Government Program Office may elect to provide its products and services as Government Furnished Supplies/Services (GFS/S). If such election is exercised, the affected prime contract shall be modified to delete the affected workload, together with the associated price adjustments.

1.2.2.1 The <ABC Company> shall not deem any such modification to be an unreasonable interference with the <ABC Company>’s performance.

1.2.2.2 The <ABC Company> shall continue to provide integration management, oversight, and recommendations to the Government Prime Contracting Officer (PCO) for any actions as may be required to mitigate reasonably foreseeable OO-ALC production shortfalls.

1.2.3 Termination of Leases Under 10 USC §2667: The OO-ALC/CC may terminate the lease at any time.

1.2.3.1 The lease may provide the lessee first right to purchase, if the lease is revoked to permit the U.S. to sell. The further provisions of 10 USC §2667 must be met in this case.

1.3 Work in Process: Workloads identified in associated IAs, which have not been delivered in accordance therewith, may be terminated in a manner set forth in the IAs. Otherwise, in the event either Party may require a termination of an IA prior to completion for reasons other than the existence of a public exigency or mission priority, the party seeking termination shall provide written notification to the other party. In the event an IA is terminated, the OO-ALC shall be entitled to retain the previously established unit cost of any completed items of work delivered and accepted, the cost of work in process performed, and any costs directly caused by the termination. Failure to agree upon a termination settlement shall be resolved in accordance with Article 15, Resolution of Disputes and Agreements, and any applicable terms within the affected IA.

1.4 Stop Work: The <ABC Company> may, as a result of a stop work order, require the OOALC to stop all, or any part, of the work called for by an IA for a period of 90 days after the order is delivered to the appropriate OO-ALC contact, or for any further period to which the Parties may agree. The order shall be specifically identified as a stop-work order. Each stop-work order shall specifically identify the IA or IAs, by assigned control number, for which work is to stop. The OO-ALC shall continue work on all IAs not specifically cancelled. Upon receipt of said order, the OO-ALC shall immediately comply with the terms and take all reasonable steps to minimize the incurrence of costs allocable to the work covered by said order during the period of work stoppage. Within a period of 90 days after a stop-work order is delivered to the OO-ALC, or within any extension of that period to which the Parties will have agreed, the <ABC Company> shall either cancel the stop-work order or engage the OO-ALC in termination discussions.

1.4.1 If a stop-work order is canceled or the period of the order or any extension thereof expires, the OO-ALC shall resume work. The <ABC Company> shall make an equitable adjustment in the delivery schedule or IA price, or both, and the IA will be modified by bilateral modification.

1.4.2 If a stop-work order is not canceled and the work covered by the order is ultimately terminated, the <ABC Company> shall allow reasonable costs resulting from the stop-work order in arriving at the termination settlement to the extent that these costs are recognized as reasonable, allowable, allocable and payable under <ABC Company>’s applicable Air Force prime contract.

ARTICLE 4 – ROLES AND RESPONSIBILITIES

1.1 Executive Administration: The OO-ALC representatives (Complex Business Offices) and the <ABC Company> representative (Vice President & Managing Director, Focused Logistics) will serve as the executive administrators of this partnership. Their responsibilities include but are not limited to providing resources to implement and manage PAs and IAs as detailed in paragraph 4.1.1.

1.1.1 Responsibilities: Utilizing an IPT approach, the Executive Administrators shall

4.1.1.1 Keep each other informed of all communications between PA stakeholders regarding any issues impacting the PA and its IAs.

1.2 Air Force Weapon System Program Office: The OO-ALC representative (Complex Business Office) and the Air Force weapon system program office representative (program manager) shall be responsible for integrating sustainment issues between their organizations. Their responsibilities include but are not limited to providing resources to implement and manage PAs and IAs as detailed in paragraph 4.2.1.

1.2.1 Responsibilities: Utilizing an IPT approach, the Air Force weapon system program office representative shall

1.2.1.1 Negotiate, award, fund, and provide Government oversight and administration of prime contracts for system sustainment.

1.2.1.2 Serve as the primary focal point for the Air Force customers.

1.2.1.3 Initiate and coordinate the Source of Repair Assignment (SORA).

1.2.1.4 Establish Depot Maintenance Activation Working Group (DMAWG) to assist in depot activation.

1.2.1.5 Coordinate with AFMETCAL on all calibration requirements.

1.3 OO-ALC: The OO-ALC representative (Complex Business Office) shall be the single point of contact for the OO-ALC. Their responsibilities include but are not limited to providing resources to implement and manage PAs and IAs as detailed in paragraph 4.3.1.

1.3.1 Responsibilities: Utilizing an IPT approach, the OO-ALC representatives shall

1.3.1.1 Cooperate with the <ABC Company> and Air Force weapon system program office to develop the work requirements, provide the associated estimates, and to develop innovative partnering arrangements.

1.3.1.2 Ensure capacity, capability, and performance of the workload described in the IA with applicable requirements and specifications.

1.3.1.3 Provide information/data as requested by the Air Force program office or System Sustainment Manager (SSM) for SORA requirements.

1.3.1.4 Continue to increase Air Force weapon system availability through improved processes and process flow, recommending new or better repair processes, and to provide a source for implementing system design changes in order to help achieve improved weapon system reliability, maintainability, and supportability.

1.3.1.5 Ensure that calibration support requirements are coordinated with OO-ALC Precision Measurement Equipment Laboratory (PMEL). Calibration support requirements and agreements shall be included in the IA.

4.4 Private Partner: The <ABC Company> representative shall be the single point of contact for the <ABC Company> concerning this partnership agreement. Their responsibilities include but are not limited to providing resources to implement and manage PAs and IAs as detailed in paragraph 4.4.1.

4.4.1 Responsibilities: Utilizing an IPT approach, the <ABC Company> representative shall

4.4.1.1 As the contractor, be responsible for ensuring the support structure meets those requirements specified in the contract.

4.4.1.2 Provide clear requirements, specifications, and all other data necessary for OO-ALC performance of partnered tasks provided through an issued IA.

4.4.1.3 Provide information/data as requested by the Air Force weapon system program office for SORA requirements.

4.4.1.4 Not be responsible for performance of Air Force work assigned under a workshare, although the Air Force may separately purchase additional <ABC Company> support for this work. The <ABC Company> shall be responsible to provide support/services necessary for the OO-ALC to perform the workshare effort if these services are funded and included in the Air Force contract.

ARTICLE 5 – IMPLEMENTATION AGREEMENTS

5.1 Objective: The objective of an IA is to identify, collaborate, and agree upon the specific work to be performed and completed. The IA is a binding agreement between the Parties concerning the specific manner in which work will be identified, estimated, activated, initiated, administered, and performed.

5.2 Issuance of IA: Any Party to this PA may propose the creation of an additional IA to perform types of work beyond the scope of existing IAs. Each IA under this PA will reference this PA and incorporate the terms hereof.

5.3 IA Numbering: The IA number is preceded by the PA number and consists of the OO-ALC and a consecutive number representing a consecutive count of IAs with a particular Private Party. Thus IA number 1 for FY13 would be OO-ALC-XYZ-13-001-OO-ALC-IA001. Note that OO-ALC-XYZ-13-001 is the PA number and that the OO-ALC designator for this section may be different than that shown for the IA in the case of multi-depot PAs. OO-ALC-IA001 is the first IA between the parties for the fiscal year. Revisions to IA will retain all of this document code, including the year and number. Append “–Rev-01” for the first revision.

5.4 Funding Plan: Not later than the beginning of the second quarter of each fiscal year (FY), the IPTs will develop requirements and estimates for the follow-on period and adjust requirements and estimates for the following three consecutive FYs. The <ABC Company> will be responsible, with OO-ALC assistance, for providing the necessary long-range budgetary forecast for the basic year plus three additional years as necessary for OO-ALC maintenance long-range forecasting.

5.4.1 Advanced Funding Payment: In accordance with DoD Financial Management Regulation 7000.14-R, the <ABC Company> shall provide advance funding to the OO-ALC for the scope of work to be accomplished in the IA(s). The OO-ALC shall not commence work prior to receipt of sufficient payment to cover the cost of performance.

5.4.1.1 Workshare: Funding will come directly to the OO-ALC accompanying a purchase order through regular Air Force channels, made payable to OO-ALC, and will include the IA number of the agreement. The purchase order is a specified work action outlined in an IA.

5.4.1.2 Direct Sales: The <ABC Company> will issue a check made payable to the “U.S. Treasury”, along with a purchase order directly to the OO-ALC. The check and purchase order will include the IA number of the agreement. Incremental funding may be permitted in appropriate circumstances if the increment is sufficiently funded. Under the Air Force contract, the Contracting Officer will consider payments made by the <ABC Company> to an OO-ALC as expenditures and not as contract financing payments.

5.4.1.3 Lease: Funding may be given in check made payable to the “U.S. Treasury” or in the form of payment in-kind, which will be specified in the IAs.

5.5 Access to Facilities: OO- ALC and the <ABC Company> associated with this PA will furnish reasonable access to facilities for the purpose of providing technical assistance or support as required in performance of an IA. Any specific facility requirements will be negotiated within each IA.

ARTICLE 6 – CONTRACTING OUT

6.1 Contracting Out: Any incidental portions of the workload that the OO-ALC plans to contract out shall be clearly reflected during IA discussions and documented in the IA.

6.2 Unusual Temporary Circumstances: If the OO-ALC determines that it must contract out part of its work assignment under an IA, the OO-ALC will nonetheless remain responsible for the performance of the IA. The OO-ALC shall notify the <ABC Company> and Air Force Program Office, as appropriate, of temporary circumstances and potential consequences at the first available opportunity.

ARTICLE 7 – QUALITY STANDARDS AND COMPLIANCE

1.1 Quality Standards: In performing its workloads under this PA, the OO-ALC is required to comply with then-current Air Force publications. If the Air Force quality standards change, the work will be accomplished in accordance with the new standards. Any subsequent dispute will be resolved in accordance with Article 15, Resolution of Disputes and Disagreements. The OO-ALC does not take responsibility for the accuracy of information provided by the <ABC Company>.

1.2 OO-ALC’s Quality: The OO-ALC will comply with the existing Air Force Quality Management System in place. Quality assurance standards and compliance inspections will be IAW applicable AFI 21-series directive publications, and associated Air Force Material Command, and local supplements. The OO-ALC Quality Assurance shall provide and maintain a Quality Assurance plan that complies with Air Force directive publications. Evaluation of assets for production quality deficiency reporting is implemented under Technical Order 00-35D-54, “USAF Deficiency Reporting, Investigation, and Resolution”.

1.3 Quality Standards Compliance: In the event the <ABC Company> and/or program office questions compliance of OO-ALC’s quality with Air Force standards for OOALC activities, the OO-ALC will cooperate with the <ABC Company> and/or program office to review quality performance and processes, provide information and/or take specific corrective action(s) as may be required.

1.4 Quality Records: The <ABC Company> may request, in writing, access to the OOALC’s quality records. Following the request, the ALC will provide access to the <ABC Company> within 15 days of records release approval.

1.5 Software Development Quality Standards: The OO-ALC adheres to the Software Engineering Institute’s (SEI) Capability Maturity Model Integration (CMMI) for software development. An integral component of this model includes software quality assurance. The SEI CMMI is the standard model used in assessing the maturity of an organization’s software development processes, testing processes, quality assurance processes, configuration management processes, etc.

1.5.1 The OO-ALC will follow depot-developed quality assurance processes, which follow the quality assurance requirements of the CMMI.

1.5.2 The OO-ALC Software Quality Assurance will conduct periodic software project audits and can provide <ABC Company> any results the Air Force determines may improve partnership performance. Article 17 details audit and oversight as it relates to this Agreement.

ARTICLE 8 – WARRANTY

0. OO-ALC Work: The OO-ALC warrants the services performed and the goods provided, under an IA, comply with the work descriptions, specifications, and technical or data packages whether attached or incorporated by reference to an IA. OO-ALC liability is limited to the OO-ALC’s correction of material and workmanship defects and is limited to the cost of Government rework. Material and workmanship discrepancies related to the <ABC Company> furnished property are not warranted by the OO-ALC.

0. For DoD workloads, unless the OO-ALC determines rework, repair, or replacement by another organization is in the best interest of the Air Force, the ALC agrees to be liable for the labor cost of:

0. OO-ALC rework of deficient or non-compliant OO-ALC performance,

0. OO-ALC repair of OO-ALC damage to <ABC Company>'s components or piece parts, unless damaged beyond repair.

0. For DoD workloads, the Government Program Office is responsible for the replacement of <ABC Company> components or piece parts lost or damaged beyond repair by the OO-ALC.

0. For non-DoD workloads, the OO-ALC agrees to be liable for the labor cost of:

2. OO-ALC rework of deficient or non-compliant OO-ALC performance,

2. OO-ALC repair of OO-ALC damage to <ABC Company>’s components or piece parts, unless damaged beyond repair.

0. For non-DoD workloads, the <ABC Company> agrees to be liable for the cost of components or piece parts lost or damaged beyond repair by the OOALC.

0. Exceptions: The warranty provided by OO-ALC may be modified as provided in an IA.

0. Actions that Void Warranty: Any corrective action(s) unilaterally undertaken or authorized by the <ABC Company> to correct a suspected workmanship defect shall be solely at the <ABC Company>’s expense and shall void the OO-ALC warranty.

0. Reporting and Corrections: Warranty claims to be considered by the OO-ALC must be received by the OO-ALC within twelve (12) months from the date of acceptance, in the case of supplies, and within twelve (12) months from acceptance of services by the <ABC Company> or its designated representative. Such acceptance shall not be unduly delayed. The OO-ALC shall determine its responsibility for warranty correction and the appropriate means for corrective action, within 60 days of receipt of a notice of a warranty claim.

0. Dispute: Failure of the parties to agree on responsibility for the corrective action shall be a matter for resolution in accordance with the Article 15, Resolution of Disputes and Disagreements. If <ABC Company> requires the OO-ALC to perform corrective action prior to resolution of the dispute, then such corrective action shall be considered new work and advance payment shall be required, unless adequate unliquidated prior funding remains available. In the event the outcome of a dispute is in the favor of <ABC Company>, the OO-ALC shall offer a credit for the amount due as one alternative remedy.

ARTICLE 9 – LIMITATION OF LIABILITY

1.1 Liability/Hold Harmless for Damage to Property: Except as provided in Article 10 herein, regardless of who may have caused the damage, each party shall be responsible for any damage that may occur to its real and/or personal property associated with and used for the accomplishment of this PA and related IAs. Each party shall hold the other party harmless for any damage that may occur to its real or personal property used for or associated with the accomplishment of this PA or related IAs.

1.2 Limitation on Liability: Except as provided in Article 10 herein and notwithstanding any other article in this PA, in no event shall either party hereto be liable to the other party for consequential, incidental, or special (including multiple, or punitive, or other indirect) damages claimed to be incurred by the other party, whether such claim arises under contract, tort (including strict liability) or other theory of law. Except as may be otherwise expressly provided for in this PA or related IAs, the <ABC Company> must seek cost, schedule and other relief at the Air Force contract level for OO-ALC performance failures alleged to negatively impact performance of the Air Force contract.

ARTICLE 10 - INDEMNIFICATION

1.1 Indemnification for Damages and Injuries: Per 10 USC §2474(e)(2)(B), the <ABC Company> agrees to hold harmless and indemnify the United States from:

1.1.1 Any claim for damages or injury to any person or property arising out of the use of the Government’s equipment or facilities, except in the case of OO-ALC employee’s willful misconduct or gross negligence or in the case of a claim by a purchaser of articles or services that were provided under this PA or IA that damages or injury arose from the failure of the OO-ALC to comply with quality, schedule, or cost performance requirements in the contract to provide the articles or services under the circumstances described in 10 USC §2563(c)(3); and

1.1.2 Any liability or claim for damages or injury to any person or property arising out of a decision by the Secretary of the Air Force or the Secretary of Defense to suspend or terminate that use of equipment or facilities during a war or national emergency.

1.2 Indemnification for Violation of Laws: Both Parties recognize their responsibility to comply with all applicable local, state and Federal laws or rules and regulations, and Executive Orders (EO), applicable to each Party. Each Party will be responsible for its own violations of local, state and Federal laws, rules and regulations and EOs. However, the <ABC Company> agrees it will indemnify the OO-ALC against any and all liability arising out of, or in the performance of, this Agreement as a result of the <ABC Company>’s violation of any such local, state and Federal laws, rules and regulations, or EOs, including but not limited to, environmental, occupational safety, and labor laws.

ARTICLE 11 – GOVERNMENT USE OF PRIVATE PARTNER-OWNED PROPERTY

11.1 Private Partner-Owned Property: The <ABC Company> may provide <ABC Company>-owned property to the OO-ALC, including but not limited to direct and indirect material, tools, patterns, and equipment as necessary to perform IA requirements under this PA. This PA establishes accountability requirements for <ABC Company>-owned property that has been or may be placed in the OOALC’s possession and/or control for the exclusive purposes described in this PA. The OO-ALC agrees not to use <ABC Company>-owned property, nor the designs, drawings, specifications, or other information received herein for any other purposes without prior written consent by the authorized <ABC Company>’s representative. Should written approval be granted for use on other workloads, the workloads for which the equipment was originally intended will take production priority. Title to the subject property does not transfer as a result of change in possession. <ABC Company>-owned material or replacement material will be returned in the form of products (except that which become normal scrap or industrial waste) or unused material. The property shall not be transferred, destroyed, modified, or otherwise disposed of without prior written authorization from the <ABC Company>’s representative. The <ABC Company> shall provide an initial calibration certificate compliant with Air Force DI-QCIC-80798A for all Test, Measurement and Diagnostic equipment upon installation and shall provide sufficient technical data and documents/directions to enable the OO-ALC PMEL to perform subsequent calibrations as required by the TO 00-20-14 and the AFMETCAL program. Items provided directly from the Air Force Program Office to the OO-ALC as Government-furnished Equipment (GFE) are not subject to the provisions of this clause.

11.2 OO-ALC Inspections and Loss, Damage, or Destruction Reports: The OOALC shall inspect any such material furnished by the <ABC Company> and shall have the right to reject nonconforming material upon inspection. Nonconforming materials accepted by the OO-ALC shall not excuse performance in strict accordance with the applicable specifications, unless such nonconformance could not be discovered by a reasonable inspection. The OOALC agrees to promptly report, in writing, all incidents of loss, damage, or destruction of the subject property to the <ABC Company>’s representative. Loss, Damage, or Destruction (LDD) reports shall contain the following factual data as to the cause and circumstances surrounding the incident:

11.2.1 Document number for which the property is accountable.

11.2.2 Property identification number and description of property, (e.g., part number, serial number, tool number, etc.).

11.2.3 Acquisition cost of the property, if known.

11.2.4 Date, time, and location of incident/discovery.

11.2.5 Known interests in and commingled property of which the LDD is/was a part.

11.2.6 Estimated scrap proceeds, when applicable.

11.2.7 Actions to prevent recurrence or repetition of similar incidents.

11.3 Property Accountability: The OO-ALC agrees to maintain appropriate ownership identity of the subject property, maintain accountability records, and periodically report inventory of subject property in accordance with sound business practices. The OO-ALC agrees to notify the <ABC Company>’s representative immediately when the subject property will no longer be required and request disposition instructions from the <ABC Company>’s representative. During the period of performance, the OO-ALC will keep all property furnished by the <ABC Company>, and all Government property as may be identified elsewhere in this PA to which the <ABC Company> is accountable, segregated and clearly marked and will maintain a complete inventory thereof in accordance with approved property management system in effect at the OO-ALC facility at the time. Except for property incorporated in delivered end products, the OOALC will, upon termination or completion of this work effort, deliver property, as directed by the <ABC Company>, in good condition, subject to ordinary wear and tear and normal manufacturing losses.

ARTICLE 12 – INTELLECTUAL PROPERTY

1.1 Air Force Government Intellectual Property: <ABC Company> has agreed that the OO-ALC may create for <ABC Company>, software programs including (without limitation), programming, corrections, enhancements, improvements, translations, updates or upgrades, and any other derivative work or collective work created for or delivered to <ABC Company> under this PA ("Work Product"). In the event that the Parties agree that the OO-ALC will perform work which will result in the development, creation, or modification of intellectual property, the Parties agree to enter into an appropriate agreement to address their rights and duties with respect to such intellectual property. Nothing in this clause may be interpreted to limit any Air Force Government intellectual property rights specified in the contract.

ARTICLE 13 – NON-PERFORMANCE BY THE PARTIES

1.1 General: Non-performance by either party shall require the parties to collaborate, quickly identify, and correct the non-performance problems and re-establish the IA’s capabilities. Examples of these collaborative efforts are: root cause investigation, process improvements, supply chain analysis and application (bit and piece support), and/or Corrective Action Plans. Remedies may include the <ABC Company>’s timely accomplishment of support responsibilities for the OO-ALC, OO-ALC acceleration, and other possible alternatives or corrective actions deemed necessary to meet Air Force program requirements. In the event a remedy cannot be found, resolution will be made utilizing Article 15, Resolution of Disputes and Disagreements.

1.2 Required Performance: The OO-ALC shall perform designated work upon receipt of funds as authorized by each IA. The <ABC Company> shall perform and make available designated work in accordance with the provisions of its contract with the Air Force and of IA(s) written under this PA.

1.3 Consequences for Non-performance: In addition to resolution of the non-performance in paragraph 13.1 and except as agreed to herein, details concerning consequences for non-performance are contained within the IA(s).

1.3.1 Non-performance by OO-ALC: The <ABC Company> shall be entitled to submit requests for cost and schedule relief as addressed in paragraph 13.4. Non-performance by OO-ALC that is the result of <ABC Company>’s failure to provide all necessary drawings, specifications, data, engineering support and/or <ABC Company> provided repair material/parts required to successfully perform the workload shall be an excusable delay.

1.3.2 Non-performance by <ABC Company>: The OO-ALC shall be entitled to charge for the costs of any IA required minimum complement of personnel that must remain idle as a result of <ABC Company> non-performance such as delays in furnishing material, engineering services support, delays in workload or lack of workload generation, and charges for the OO-ALC costs incurred due to <ABC Company>-directed machine set up/retooling/reconfiguration. Failure to provide all necessary drawings and data shall be treated as a delay in engineering services support.

1.4 Direct Sales and/or Workshare: Appropriate quality, cost performance and schedule relief to the <ABC Company>, should the OO-ALC fail to properly or timely perform the work issued to it under an IA, may be obtained in accordance with the terms of the prime contract (e.g. Section H of the Air Force contract). In the event this PA does not support an Air Force contract, the <ABC Company> agrees to hold harmless and indemnify the United States for all consequential, incidental, or special (including multiple, or punitive, or other indirect) damages that are claimed to be incurred by the other Party due to non-performance.

ARTICLE 14 – CHANGES

1.1 Mutual Agreement: At any time, either party may submit to the other, proposed written changes to this PA and/or an IA. No changes to these Agreements will be made without the prior written consent of the signatories, or designated representative, to the PA and/or IA.

1.2 Air Force Program Office Changes: In event modification to this PA or an IA is required resulting from a change in public law, Air Force program requirement, or policy, the Air Force Program Office will:

1.2.1 Promptly inform other Parties of any such change.

1.2.2 Consult with other Parties concerning potential impacts on OO-ALC workload(s) and Air Force contract performance.

1.2.3 Enter into good faith negotiations to achieve an equitable mutual agreement on a modification to implement the change.

1.3 Failure to Agree: If the parties are unable to agree to a mutually acceptable change to this Agreement and/or an IA, such failure to agree shall be resolved under Article 15, Resolution of Disputes and Disagreements.

ARTICLE 15 – RESOLUTION OF DISPUTES AND DISAGREEMENTS

1.1 Prevention: Both parties are committed to a disputes-prevention atmosphere during the performance of this PA and related IAs. The parties agree their best efforts will be made to settle all controversies at the lowest level possible through direct negotiations between authorized individuals acting for each party.

1.2 Process: Any dispute between the parties arising under this PA or related IAs shall be diligently negotiated between the parties at the lowest level possible. In the event lower level resolution is not possible, the dispute shall be elevated through the management chain of each party to the level of the executive administrators. In the event executive administrators are not able to resolve a dispute, the parties shall seek resolution through appropriate alternate dispute resolution (ADR) means. In the event the parties are not able to resolve the matter through ADR, either or both parties may resort to whatever legal means they deem appropriate.

1.3 Costs: Each party to the dispute will bear all of its own costs incurred in executing this disputes process.

1.4 Duty to Proceed: Unless directed by a stop work order from the <ABC Company>, the OO-ALC will continue to perform the work while the dispute in question proceeds through the disputes process outlined herein as long as adequate advance funding is available. Such continuing performance will be subject to any determination of the existence of a public exigency or mission priority, made upon the discretion of the OO-ALC/CC as required. Specific procedures relating to the issuance and receipt of a stop work order are addressed in Article 3 Term and Termination.

ARTICLE 16 – NONDISCLOSURE OF PROPRIETARY/SENSITIVE INFORMATION

1.1 Protection: Each party agrees to protect proprietary and/or sensitive information relative to partnering discussions and activities as detailed in Appendix C. This information includes, but is not limited to, collaborative business arrangements, data, interpretations, forecasts, projections, records and studies. Certain information, disclosed verbally, may be proprietary/sensitive in nature. Each party shall clearly identify, at the time of disclosure, the proprietary or sensitive nature of the information.

1.2 Notification of Loss or Inadvertent Disclosure: Each Party agrees to promptly notify the other Party of the loss or inadvertent disclosure of any Proprietary Information and Materials or Confidential Commercial Information. Neither Party shall be liable for the inadvertent disclosure of such information to a third party if it is disclosed despite the exercise of the same degree of care as the receiving Party utilizes to safeguard its own similar information, and in any event not less than reasonable care; provided, that the Party who inadvertently disclosed promptly notifies the furnishing Party, takes all reasonable steps to retrieve the inadvertently disclosed information, immediately takes steps to preclude further disclosure, and assists the furnishing Party in taking such steps. However, such inadvertent disclosure does not relieve either Party from its continued adherence to this Article.

ARTICLE 17 – AUDIT AND OVERSIGHT

1.1 Audit and Oversight Relationship: The OO-ALC, as a government organization, is not subject to the <ABC Company>’s oversight or audits, nor audits from DCAA or DCMA. The OO-ALC is subject to oversight and audit directly by the GAO, DoD, Air Force and other Government agencies. This Agreement and its related IAs will not create a direct right of the <ABC Company> to audit the OO-ALC or its books and records. The methods and degree of reporting and insight into the OOALC’s schedule progress and technical performance, as well as cost-incurred data and overrun notification for cost-type efforts, will be as specified in each IA.

1.2 Customer Audit and Oversight: In order to ensure that the will meet the audit and record requirements of its prime contract and that the Government will be able to properly exercise its audit and oversight roles with respect to the Program, the Parties agree…