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Better Health Outcomes at Lower Costs

Health Net Federal Services Standard Purchase Order Terms and Conditions

1. Offer and Acceptance.
This Purchase Order constitutes an offer by Health Net Federal Services (“HNFS”) to purchase Goods or Services (the “Goods”) from the supplier (the “Seller”). By acceptance of this purchase order and/or commencement of any Work, the Seller agrees that the performance of Work will be governed by the Terms and Conditions which are hereby incorporated into this purchase order. Any changes or exceptions to these terms and conditions must be expressly accepted in writing by the HNFS Purchasing Agent identified the front of this Purchase Order.

2. Authority and Communication. “HNFS” means HNFS Purchasing Agent acting through its procurement organization. No other department of HNFS is so authorized to act. Claims by Seller for any adjustments will not be allowed unless duly authorized in writing by HNFS prior to implementation. All written communications are to be directed to HNFS’ procurement agent.

3. EEO Compliance.
HNFS provides equal employment opportunities (EEO) to all employees and applicants for employment without regard to race, color, religion, sex, national origin, age, disability or genetics. In addition to federal law requirements, HNFS complies with applicable state and local laws governing nondiscrimination in employment in every location in which the company has facilities. HNFS requires that Seller also comply with all applicable state and federal civil rights laws.

4. Anticorruption Laws. Seller further represents and warrants that in the performance of this Agreement Seller and its employees and agents will not violate federal, national, local or other anti-corruption laws (including provisions of the U.S. Foreign Corrupt Practices Act, “Anti-Corruption Laws”) that may be applicable to one or both parties to this Agreement, and have not previously engaged in conduct that would have violated Anti-Corruption Laws, including but not limited to obtaining or retaining business or a business advantage through unlawful payments, bribes, kickbacks, gifts, or other illegal inducements. Seller shall maintain anti-bribery policies and procedures and true and accurate records consistent with the requirements of the applicable Anti-Corruption Laws. Seller agrees to immediately notify HNFS if it violates any Anti-Corruption Laws in the performance of this Agreement.

5. Compensation.
For and in consideration of the timely and proper delivery of Goods, HNFS’s total obligation to Seller shall not exceed the amount on the front of this Purchase Order. Unless otherwise specified, the prices include all charges for packaging, handling, storage, delivery, and all taxes. Seller will pay all delivery charges in excess of the delivery charges which HNFS has agreed in writing to pay. If the Seller makes any price reductions after the date of this Purchase Order but prior to the payment date, such price reductions will be applicable to this Purchase Order. Seller warrants that the prices of the Goods covered by this Purchase Order are not in excess of the Seller’s lowest prices in effect on the date of this Purchase Order for comparable quantities of similar Goods. Any change to the Purchase Order amount shall only be authorized in writing by a HNFS Change Order, fully executed by both HNFS and Seller.

6. Delivery. HNFS will not be obligated to accept substitutions, untimely deliveries, deliveries in quantities other than those ordered by HNFS or deliveries of Goods failing to conform to Seller’s warranties contained elsewhere in this Purchase Order. Time is of the essence in this Purchase Order. Acceptance by HNFS whether of substitutions, late deliveries, partial deliveries or deliveries of non-conforming Goods shall not waive the delivery schedule set forth in this Purchase Order. Seller will immediately give written notice to HNFS of any actual or potential cause or event which threatens the timely performance of this Purchase Order. Unless otherwise specified in this Purchase Order, Seller will retain the risk of loss or damage in transit until Goods are actually delivered to HNFS’ requested destination.

7. Packing and Marking. The reports and any other Goods to be furnished hereunder shall be adequately packaged and packed to ensure safe delivery at destination. All products shall be clearly marked to identify the contents, the sender, and the individual/office to which they are being sent. Extra care shall be taken in packaging electronic media to protect against damage and to ensure that electronic media does not become separated from the routing markings. All reports and other products to be furnished shall be shipped via a method that provides for acknowledgement of receipt. Seller shall retain such receipts. Shipments containing electronic media shall be marked as such and shall include the statement “Do Not X-ray”. Seller shall include the prime contract number and seller number on all products to be furnished under the seller.

8. Inspection and Workmanship Final inspection and acceptance of Goods shall be made by HNFS, after delivery at destination unless otherwise expressly indicated in this Purchase Order, and shall be conclusive except as regards latent defects, fraud, such gross mistakes as amount to fraud, and the Seller’s warranty obligations.

Any Goods purchased hereunder shall be subject to inspection and tests by HNFS to the extent practicable at all times and places, including the period of manufacture and in any event, prior to acceptance. If HNFS makes any inspection or test on the premises of the Seller, the Seller shall, without additional charge, provide all reasonable facilities and assistance for the safety and convenience of HNFS’ inspectors in the performance of their duties. All inspections and tests shall be performed in such manner as not to unduly delay the work. No inspection or test made prior to final inspection and acceptance shall relieve the Seller from responsibility for defects or other failures to meet the requirements of this Purchase Order.

In case any Goods are defective in material or workmanship, or otherwise not in conformity with the requirements of this Purchase Order, HNFS shall have the right either to reject it, require its correction, or accept it with an equitable adjustment in price. Any Goods that have been rejected or require correction shall be removed and corrected, or replaced at the expense of the Seller, promptly after notice. If, after being requested by HNFS, the Seller fails to promptly replace or correct any defective Goods, HNFS may replace or correct such Goods and charge the Seller the cost occasioned HNFS thereby, or without further notice, terminate the Purchase Order for default according to the clause hereof entitled, “Default”.

The Seller shall provide and maintain an inspection system according to sound business practice and as otherwise provided in the Purchase Order. Records of any inspection work by the Seller shall be kept complete and available to HNFS during the performance of this Purchase Order and for such longer periods, and in such manner as may be specified elsewhere in this Purchase Order.

9. Working Conditions and Human Rights.
By acceptance of this order, seller agrees that any material violation of law by seller relating to basic working conditions and human rights, including laws regarding child labor, slavery, and human trafficking, applicable to sellers performance under this purchase order may be considered a material breach of contract for which HNFS may elect to cancel any open orders with the seller at no cost to HNFS.

10. WARRANTY.
Seller warrants that Seller and its employees shall, in providing Goods hereunder, exercise the degree of skill, care and diligence consistent with industry standards in accordance with any and all requirements, specifications or drawings provided by HNFS, and that such Work will be suitable for the purpose intended. Should Seller fail to perform to those standards, it shall (a) without cost to Client or HNFS, re-perform and correct any substandard Work; and (b) reimburse HNFS for HNFS’s direct, incidental, consequential or other costs resulting from or arising in connection with breach of such warranty. If Seller fails to replace or correct any such Goods after reasonable notice, HNFS may, at its sole option, cause such Goods to be replaced or corrected and all costs and expenses incurred in connection therewith shall be borne by Seller. However, in the event that the Goods deficiency affects the immediate health and safety of HNFS, it’s Client, or others, then HNFS shall have the right to direct re-performance and correction of the substandard Work by whatever means is most immediate, and such reasonable costs associated with said correction shall be the sole responsibility of Seller.

Seller also warrants that any goods supplied are merchantable and comply with specifications, drawings and data submitted to or by HNFS, are free from defects, whether patent or latent, in design, material and workmanship, and are suitable for the particular use for which the items are purchased and are free and clear of all liens and encumbrances. Seller shall transfer all manufacturer or Seller warranties associated with the goods supplied to HNFS and/or entity designated by HNFS.

This Warranty Article supersedes any lesser warranty, whether stated or implied, which may be contained in submittals or other documentation delivered to HNFS by Seller under this Seller PO, regardless of whether the submittals or other documentation is accepted or otherwise approved by HNFS, unless a lesser warranty is specifically identified in the Seller PO. Any Work corrected as a consequence of this Article shall be subject to the same warranty as provided for the original Goods.

11. Payment. Unless other payment provisions are specified elsewhere in this Purchase Order, payment shall be made upon the later of (i) final acceptance by HNFS of the Goods, or (ii) submission by Seller of a proper invoice. Payment for Goods does not constitute acceptance. HNFS will take advantage of any discounts incorporated elsewhere in this Purchase Order, or found on individual invoices, whichever discount is more favorable to HNFS. Delays in receiving invoice(s), errors or omissions on invoice(s), or lack of supporting documentation required by the terms of this Purchase Order, will be cause for HNFS to withhold payment without losing discount privileges. The first day of any discount period shall be the later of (i) the first working day of HNFS following final acceptance of the Goods, or (ii) HNFS’ receipt of a proper invoice. HNFS may make adjustments to amounts invoiced by Seller for shortages, rejection, or other failure to comply with the provisions of this Purchase Order.

HNFS will notify Seller of any such adjustments. Unless specified elsewhere in this Purchase Order, Seller shall furnish a separate invoice for each shipment of Goods or major increment of service rendered.

Seller shall submit original invoices including supporting documentation:
To: Health Net Federal Services, LLC (HNFS)
P.O. Box 1360
Rancho Cordova, CA 95741-1360

Each invoice must contain the following information:
Seller’s name;
Invoice number and date;
Purchase Order number, line item number, description of the Goods or Services, quantity, unit of measure, unit price, and extended total;
Name and address for remittent of payment.

By virtue of its submission to HNFS, each invoice or claim from Seller shall be deemed to include a warranty by Seller that all amounts claimed by Seller are due and proper. HNFS shall have the right to audit such claim or invoice and any books, documents or records of Seller that involve transactions relating to or which form the basis of said invoice or claim. In addition to any other rights HNFS may have under this Purchase Order, HNFS shall have a right of action against Seller for any breach of such warranty. Upon request by HNFS, Seller shall provide written certification of Seller’s invoices or claims in such terms, and with such signatures, as HNFS may prescribe; and HNFS may ignore any invoice or claim not so certified. Seller shall ensure that each of the Sellers and all tiers is bound by the same obligations as are imposed on Seller by this paragraph.

12. Risk of Loss. Notwithstanding any term of this Purchase Order, or any inference therefrom, the risk for any loss of or damage to or destruction of Goods described in this Purchase Order shall be borne by Seller at all times until the Goods are received and accepted by HNFS. Title to the Goods passes to HNFS upon final acceptance after inspection.

13. Insurance Requirements. Seller agrees that any Services to be rendered or Goods to be furnished by Seller under this Purchase Order shall be rendered or furnished as an independent HNFS, and Seller shall be solely responsible for the safe conduct of the performance under this Purchase Order and for the protection of all persons, premises or facilities involved in said performance. Seller shall provide all safeguards and take all necessary precautions to prevent the occurrence of any accident, injury, death or loss to any person or property in the performance of this Purchase Order, whether on Seller’s property, HNFS’ property or elsewhere. All performance under this Purchase Order by Seller is at Seller’s risk as to the methods, processes, procedures and safe conduct of the work. Seller will indemnify and defend HNFS and hold HNFS harmless from and against any and all losses, liabilities, claims, demands, suits, actions, proceedings and subrogation arising from or relating to the performance of Seller’s work. Before performing any work on HNFS’ premises, Seller will obtain (and thereafter maintain) the following insurance: (a) Workers’ Compensation and Employer’s Liability Insurance in the amount of $500,000 or the minimum limits required by law, whichever is greater, with waiver of subrogation in favor of HNFS; (b) General Liability Insurance (including contractual, products and completed operations coverage) with bodily injury limits of at least $1,000,000 per occurrence and $1,000,000 annual aggregate and with property damage limits of $1,000,000 per occurrence; and (c) Automobile Liability Insurance with bodily injury limits of at least $1,000,000 for any injuries to any person, $1,000,000 for any one accident involving two or more persons, and property damage of not less than $1,000,000 per accident. Seller will assure that all of the foregoing insurance will identify HNFS as a certificate holder and additional named insured, and Seller will provide a certificate of insurance upon request evidencing such coverage. Such insurances shall be primary to any other insurance maintained by HNFS. Seller will also assure that all certificates must provide ten (10) days’ notice to HNFS prior to cancellation or alteration of the insurance.

14. Governing Law. This Purchase Order shall be and is deemed to be made under the laws of the State of Delaware.

15. No Assignment. This Purchase Order may not be assigned and Seller may not delegate any performance, duty or other obligation of Seller without prior written consent of the HNFS Purchasing Representative. For any responsibility that is further delegated (after HNFS approval), Seller shall require the delegated entity to perform that function according to the requirements of this Purchase Order, including the appropriate URAC Standards.

16. Changes. HNFS may, without invalidating this Purchase Order, make changes of any kind within the general scope of this Purchase Order. Changes made to this Purchase Order shall be incorporated by written modification only and shall not be binding unless signed by a HNFS Agent. If a change causes an increase or decrease in the cost of or the time required for performance of this order, Seller shall give written notice within three (3) days of receipt of the change and shall specify in full and complete detail the basis for its assertion of its right to an adjustment within seven (7) days thereafter. Claims asserted thereafter shall be deemed waived. Failure to agree to any adjustment shall be a dispute under the Disputes Section. However, nothing in this Section shall excuse Seller from proceeding with its Work as directed by HNFS.

Issuance of Changes/Modifications to the Purchase Order: Seller shall be provided with each Change Order issued under this Purchase Order, and afforded the opportunity to acknowledge acceptance of the Change Order. In the event that Seller disagrees with the Change Order as issued by HNFS, then Seller shall notify HNFS’s Agent of such disagreement, in writing, no later than ten (10) calendar days after date of issuance of the Change Order. Such notice shall identify the reason(s) for Seller’s disagreement, including supporting documentation as required to substantiate Seller’s concern(s). If Seller fails to provide HNFS with such notice of disagreement within the time period herein stipulated, then Seller shall be deemed to have accepted the Change Order as written and Seller agrees that it has waived its right to disagree with the actions, value, and/or schedule set forth in the Change Order.

17. Notification of Change. Seller shall not be entitles to payment of any additional compensation for any cause other than as specifically provided for in this Purchase Order, including without limitation any act, or failure to act by HNFS, or the Client or the happening of any event, thing or occurrence (hereinafter “changes”) unless seller shall have a given HNFS due written notice of any conduct by HNFS (including actions, inactions, and written or oral communications) that seller regards as a change to the terms of this Purchase Order.
The written notice of change shall set forth all facts required to allow the evaluation of reasons for the change and the evaluation of its merits. Notice shall be given as soon as possible, and whenever possible, prior to the time that the seller commences performance of the work giving rise to the potential change, or as otherwise specified in the Purchase Order, or in all other cases within five (5) days after the happening of the event, thing, or occurrence giving rise to the potential change.

It is the intention of this section that any difference between the parties, arising under and by virtue of this Purchase Order, be brought to the attention of the HNFS Agent at the earliest possible time in order that such matters may be settled, if possible, or other appropriate remedial action promptly be taken. Seller hereby agrees that it shall have no right to additional compensation, excuse for non-performance, or any claim that may be based on any act, failure to act, event, thing, or occurrence for which timely written notice of potential changes as herein required was not filed.

18. Disputes. If any claim, controversy or dispute of any kind or nature whatsoever arises between HNFS and Seller and such dispute cannot be settled through negotiation, then any dispute shall be determined in appropriate legal proceedings, first through non-binding Alternative Dispute Resolution proceedings, if agreed to by the parties, then, if necessary, in a court of law, consistent with the Governing Law Article. Pending the resolution of any dispute under this Purchase Order, the Seller shall proceed as directed by written notice from HNFS. Disputes under this Purchase Order shall not affect any other Purchase Order in place or other Work being performed by Seller.

19. Incidental or Consequential Damages. In no event shall either party be liable to the other for any loss of profits or any other indirect, special or consequential damages of any nature whatsoever.

20. Indemnification. Seller shall indemnify HNFS, its subsidiaries, affiliates and their agents, employees, officers and directors against any and all claims or suits for including, but not limited to, injury to or death of persons, or for damage to or destruction of property, or for environmental pollution, resulting from any and all acts of Seller or its employees in the performance of this Purchase Order. Seller shall indemnify HNFS, its subsidiaries, affiliates and their agents, employees, officers and directors for any penalties, or fines imposed on HNFS by reason of Seller’s performance.

21. Patent and Copyright Indemnity. If HNFS receives a claim that the Goods or any part thereof manufactured by Seller infringes a U.S. patent, HNFS shall notify Seller promptly in writing and give Seller information, assistance, and exclusive authority to evaluate, defend and settle such claim. Seller shall then, at its own expense and option, (i) settle such claim, or (ii) procure for HNFS the right to use the Good, or (iii) replace or modify the Goods to avoid infringement, or (iv) remove the Goods and refund the purchase price (including transportation costs) less a reasonable amount for usage, or (v) defend against the infringing claim. If a court of competent jurisdiction subsequently holds the Goods to be infringing, the Seller shall pay any costs and damages finally awarded by reason of such infringement, and if the use of the Goods is enjoined, the Seller shall take, at its option, one or more of the actions described in (ii), (iii), (iv), or (v) above.

The Seller shall not be liable to HNFS for any special, indirect, incidental, or consequential damages or loss of profits arising out of any patent infringement. This patent indemnification shall not apply to either (I) Goods made to HNFS’ specifications or designs, (ii) Goods not manufactured by Seller, or (iii) Goods which have been modified by HNFS or used by HNFS in combination with any software or other equipment which is not provided by Seller to change, modify or improve Goods.

The foregoing states the entire liability of Seller with respect to infringement of any valid United States patent or copyright provided that Seller shall fully indemnify, defend and hold harmless HNFS from and against any claims, demands, damages, losses, costs, and expenses or causes of action or proceedings arising from or by virtue of the foregoing.

22. Force Majeure. Seller shall not be liable for failure or delay in performance resulting from, directly or indirectly, any cause or circumstance beyond its reasonable control. Such causes or circumstances shall include, without limitation, acts of God, acts or orders of any governmental authority, strikes or labor disputes, natural disasters, civil disturbances, difficulties or delays in transportation or delivery services, or other causes beyond the reasonable control of Seller. Seller agrees to notify HNFS of any such failure or delay in performance as soon as practicable.

23. Stop-Work-Order. HNFS may, at any time, by written notice to Seller, stop all or part of the Work hereunder for up to ninety (90) days. Upon receiving a stop-work order, Seller shall immediately comply with its terms and take all reasonable steps to avoid incurring any additional cost allocable to such Work. Within ninety (90) days- after the effective date of the stop-work order, HNFS shall either cancel the stop-work order or terminate the Work covered by the stop-work order. HNFS shall make an equitable adjustment in the Purchase Order delivery schedule and/or price if the stop-work order results in an increase in time or cost for performance. Seller must assert a claim for equitable adjustment within fifteen (15) days after the end of the Work stoppage.

24. Acts of Insolvency. HNFS may terminate this Purchase Order by written notice to Seller, if Seller becomes insolvent, makes a general assignment for the benefit of creditors, suffers or permits the appointment of a receiver for its business or assets, becomes subject to any proceeding under any bankruptcy or insolvency law whether domestic or foreign, or has wound up or liquidated, voluntarily or otherwise.

25. Termination. HNFS at any time by written notice may cancel this Purchase Order, or any part thereof, at its convenience and for other than default as contemplated under the clause entitled, “DEFAULT”, in which event HNFS shall be liable for the payment of reasonable cancellation charges which shall take into account, among other things, expenses already incurred and the Seller’s actual liabilities against commitments incident to this Purchase Order. Seller shall place all orders for, and schedule deliveries of materials and p arts necessary for its performance under this Purchase Order at such times as will enable Seller to meet, but not unreasonably anticipate, the schedule of deliveries set forth herein. In the event of cancellation of or changes to this Purchase Order, HNFS shall not be liable for any charges or costs arising out of commitments unreasonably anticipated by the Seller for the acquisition of said materials and parts, or out of work performed hereunder. In no event shall HNFS be liable for cancellation charges in excess of the Purchase Order price.

The foregoing shall be in addition to any other rights HNFS may have under this Purchase Order or applicable law.

26. Confidentiality. Unless otherwise authorized by HNFS, Seller shall keep all information relating to this Purchase Order and Work hereunder confidential. Further, to the extent that the Work under this Purchase Order required that the Seller be given access to confidential or proprietary business, technical or financial information belonging to the Client, HNFS or other companies, Seller shall after receipt thereof, treat such information as confidential and agrees not to appropriate such information to its own use or to disclose such information to third parties unless specifically authorized by HNFS in writing. Seller shall not disclose or release any information, new release, public announcement, advertisement or other such publicity concerning this Purchase Order or the Work or Goods hereunder to any third party without the express approval of HNFS. The restrictions set forth herein shall continue in effect upon completion or termination of this Purchase Order.

27. Taxes. Unless prohibited by law, Seller shall pay and has included in the price of the Purchase Order any federal, state or local tax, transportation tax, or other tax which is required to be imposed upon the Goods ordered hereunder, or by reason of their sale or delivery.

28. Compliance with Laws. (a) In the performance of this Purchase Order Seller shall comply with all federal, state and local safety laws, and all other applicable federal, state and local laws, regulations, rules and ordinances (collectively, “applicable laws”). Seller agrees, upon request, to furnish HNFS a certificate regarding compliance or compliance with applicable laws in such form as HNFS may from time to time require. Seller agrees to indemnify and hold HNFS harmless to the full extent of any loss, damage or expense (including attorneys’ fees) which HNFS may incur as a result of Seller’s violation of any applicable laws.

29. Export. Some products, materials, information or technology (materials/information) may be subject to import and/or export control laws and regulations of the U.S. or other countries. Seller agrees that it will not export, re-export or transfer the materials/information, or any products developed with or utilizing the materials/information, in violation of any applicable export control laws or regulations. Seller is responsible for obtaining any licenses required to export, re-export, transfer or import the materials/information. Further, materials/information may not, in the absence of authorization by U.S. and local law and regulations, as required, be used by or exported or re-exported to (i) any U.S. sanctioned or embargoed country, or to nationals or residents of such countries; or (ii) to any person, entity, organization or other party identified on the U.S. Department of Commerce’s Denied Persons or Entity List, the U.S. Department of Treasury’s Specially Designated Nationals or Blocked Persons List, or the Department of State’s Debarred Parties List, as published and revised from time to time; or (iii) any party where the end-use involves nuclear, chemical/biological weapons, rocket systems or unmanned air vehicles.