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1. Definitions: Unless otherwise specified in the Statement of Work, the following terms shall be
given the meaning shown, unless context requires otherwise.
“Acceptance Tests” means those tests performed during the Performance period which
are intended to determine compliance of Equipment and Software with the specifications
and all other Attachments incorporated herein by reference and to determine the reliability
of the Equipment.
“Application Program” means a computer program which is intended to be executed for
the purpose of performing useful work for the user of the information being processed.
Application programs are developed or otherwise acquired by the user of the
Hardware/Software system, but they may be supplied by the Contractor.
“Attachment” means a mechanical, electrical, or electronic interconnection to the
Contractor-supplied Machine or System of Equipment, manufactured by other than the
original Equipment manufacturer that is not connected by the Contractor.
“Business entity” means any individual, business, partnership, joint venture,
corporation, S-corporation, limited liability company, sole proprietorship, joint stock
company, consortium, or other private legal entity recognized by statute.
“Buyer” means the State’s authorized contracting official.
“Commercial Hardware” means Hardware developed or regularly used that: (i) has
been sold, leased, or licensed to the general public; (ii) has been offered for sale, lease,
or license to the general public; (iii) has not been offered, sold, leased, or licensed to the
public but will be available for commercial sale, lease, or license in time to satisfy the
delivery requirements of this Contract; or (iv) satisfies a criterion expressed in (i), (ii), or
(iii) above and would require only minor modifications to meet the requirements of this
Contract.
“Commercial Software” means Software developed or regularly used that: (i) has been
sold, leased, or licensed to the general public; (ii) has been offered for sale, lease, or
license to the general public; (iii) has not been offered, sold, leased, or licensed to the
public but will be available for commercial sale, lease, or license in time to satisfy the
delivery requirements of this Contract; or (iv) satisfies a criterion expressed in (i), (ii), or
(iii) above and would require only minor modifications to meet the requirements of this
Contract.
“Contract” means this Contract or agreement (including any purchase order), by
whatever name known or in whatever format used.
“Custom Software” means Software that does not meet the definition of
Commercial Software.
“Contractor” means the Business Entity with whom the State enters into this Contract.
Contractor shall be synonymous with “supplier”, “vendor” or other similar term.
“Data Processing Subsystem” means a complement of Contractor furnished individual
Machines, including the necessary controlling elements (or the functional equivalent),
Operating Software and Software, if any, which are acquired to operate as an integrated
group, and which are interconnected entirely by Contractor supplied power and/or signal
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cables, e.g., direct access controller and drives, a cluster of terminals with their controller,
etc.
“Data Processing System (System)” means the total complement of Contractor-
furnished Machines, including one or more central processors (or instruction processors),
Operating Software which are acquired to operate as an integrated group.
“Deliverables” means Goods, Software, Information Technology, telecommunications
technology, Hardware, and other items (e.g., reports) to be delivered pursuant to this
Contract, including any such items furnished incident to the provision of services.
“Designated CPU(s)” means for each product, if applicable, the central processing unit
of the computers or the server unit, including any associated peripheral units. If no
specific “Designated CPU(s)” are specified on the Contract, the term shall mean any and
all CPUs located at the site specified therein.
“Documentation” means manuals and other printed materials necessary or useful to the
State in its use or maintenance of the Equipment or Software provided hereunder.
Manuals and other printed materials customized for the State hereunder constitute Work
Product if such materials are required by the Statement of Work.
“Equipment” is an all-inclusive term which refers either to individual Machines or to a
complete Data Processing System or Subsystem, including its Hardware and Operating
Software (if any).
“Equipment Failure” is a malfunction in the Equipment, excluding all external factors,
which prevents the accomplishment of the Equipment’s intended function(s). If microcode
or Operating Software residing in the Equipment is necessary for the proper operation of
the Equipment, a failure of such microcode or Operating Software which prevents the
accomplishment of the Equipment’s intended functions shall be deemed to be an
Equipment Failure.
“Facility Readiness Date” means the date specified in the Statement of Work by which
the State must have the site prepared and available for Equipment delivery and
installation.
“Goods” means all types of tangible personal property, including but not limited to
materials, supplies, and Equipment (including computer and telecommunications
Equipment).
“Hardware” usually refers to computer Equipment and is contrasted with Software. See
also Equipment.
“Installation Date” means the date specified in the Statement of Work by which the
Contractor must have the ordered Equipment ready (certified) for use by the State.
“Information Technology” includes, but is not limited to, all electronic technology
systems and services, automated information handling, System design and analysis,
conversion of data, computer programming, information storage and retrieval,
telecommunications which include voice, video, and data communications, requisite
System controls, simulation, electronic commerce, and all related interactions between
people and Machines.
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“Machine” means an individual unit of Data Processing System or Subsystem,
separately identified by a type and/or model number, comprised of but not limited to
mechanical, electro-mechanical, and electronic parts, microcode, and special features
installed thereon and including any necessary Software, e.g., central processing unit,
memory module, tape unit, card reader, etc.
“Machine Alteration” means any change to a Contractor-supplied Machine which is not
made by the Contractor, and which results in the Machine deviating from its physical,
mechanical, electrical, or electronic (including microcode) design, whether or not
additional devices or parts are employed in making such change.
“Maintenance Diagnostic Routines” means the diagnostic programs customarily used
by the Contractor to test Equipment for proper functioning and reliability.
“Manufacturing Materials” means parts, tools, dies, jigs, fixtures, plans, drawings, and
information produced or acquired, or rights acquired, specifically to fulfill obligations set
forth herein.
“Mean Time Between Failure (MTBF)” means the average expected or observed time
between consecutive failures in a System or component.
“Mean Time to Repair (MTTR)” means the average expected or observed time required
to repair a System or component and return it to normal operation.
“Operating Software” means those routines, whether or not identified as Program
Products, that reside in the Equipment and are required for the Equipment to perform its
intended function(s), and which interface the operator, other Contractor-supplied
programs, and user programs to the Equipment.
“Operational Use Time” means for performance measurement purposes, that time
during which Equipment is in actual operation by the State. For maintenance Operational
Use Time purposes, that time during which Equipment is in actual operation and is not
synonymous with power on time.
“Period of Maintenance Coverage” means the period of time, as selected by the State,
during which maintenance services are provided by the Contractor for a fixed monthly
charge, as opposed to an hourly charge for services rendered. The Period of
Maintenance Coverage consists of the Principal Period of Maintenance and any
additional hours of coverage per day, and/or increased coverage for weekends and
holidays.
“Preventive Maintenance” means that maintenance, performed on a scheduled basis by
the Contractor, which is designed to keep the Equipment in proper operating condition.
“Principal Period of Maintenance” means any nine consecutive hours per day (usually
between the hours of 7:00 a.m. and 6:00 p.m.) as selected by the State, including an
official meal period not to exceed one hour, Monday through Friday, excluding holidays
observed at the installation.
“Programming Aids” means Contractor-supplied programs and routines executable on
the Contractor’s Equipment which assists a programmer in the development of
applications including language processors, sorts, communications modules, data base
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management systems, and utility routines (tape-to-disk routines, disk-to-print routines,
etc.).
“Program Product” means programs, routines, subroutines, and related items which are
proprietary to the Contractor and which are licensed to the State for its use, usually on the
basis of separately stated charges and appropriate contractual provisions.
“Remedial Maintenance” means that maintenance performed by the Contractor which
results from Equipment (including Operating Software) failure, and which is performed as
required, i.e., on an unscheduled basis.
“Software” means an all-inclusive term which refers to any computer programs, routines,
or subroutines supplied by the Contractor, including Operating Software, Programming
Aids, Application Programs, and Program Products.
“Software Failure” means a malfunction in the Contractor-supplied Software, other than
Operating Software, which prevents the accomplishment of work, even though the
Equipment (including its Operating Software) may still be capable of operating properly.
For Operating Software failure, see definition of Equipment Failure.
“State” means the government of the State of California, its employees, and authorized
representatives, including without limitation any department, agency, or other unit of the
government of the State of California.
“System” means the complete collection of Hardware, Software, and services as
described in this Contract, integrated and functioning together, and performing in
accordance with this Contract.
“U.S. Intellectual Property Rights” means intellectual property rights enforceable in the
United States of America, including without limitation rights in trade secrets, copyrights,
and U.S. patents.
2. CONTRACT FORMATION:
If this Contract results from a sealed bid offered in response to a solicitation conducted
pursuant to Chapters 2 (commencing with Section 10290), 3 (commencing with Section
12100), and 3.6 (commencing with Section 12125) of Part 2 of Division 2 of the Public
Contract Code (PCC), then Contractor’s bid is a firm offer to the State which is accepted
by the issuance of this Contract and no further action is required by either party.
If this Contract results from a solicitation other than described in paragraph a), above, the
Contractor’s quotation or proposal is deemed a firm offer and this Contract document is
the State’s acceptance of that offer.
If this Contract resulted from a joint bid, it shall be deemed one indivisible Contract. Each
such joint Contractor will be jointly and severally liable for the performance of the entire
Contract. The State assumes no responsibility or obligation for the division of orders or
purchases among joint Contractors.
3. COMPLETE INTEGRATION: This Contract, including any documents incorporated herein by
express reference, is intended to be a complete integration and there are no prior or
contemporaneous different or additional agreements pertaining to the subject matter of the
Contract.
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4. SEVERABILITY: The Contractor and the State agree that if any provision of this Contract is
found to be illegal or unenforceable, such term or provision shall be deemed stricken and the
remainder of the Contract shall remain in full force and effect. Either party having knowledge of
such term or provision shall promptly inform the other of the presumed non-applicability of
such provision.
5. INDEPENDENT CONTRACTOR: Contractor and the agents and employees of the Contractor,
in the performance of this Contract, shall act in an independent capacity and not as officers or
employees or agents of the State.
6. APPLICABLE LAW: This Contract shall be governed by and shall be interpreted in
accordance with the laws of the State of California; venue of any action brought with regard to
this Contract shall be in Sacramento County, Sacramento California. The United Nations
Convention on Contracts for the International Sale of Goods shall not apply to this Contract.
7. COMPLIANCE WITH STATUTES AND REGULATIONS:
The State and the Contractor warrants and certifies that in the performance of this
Contract, it will comply with all applicable statutes, rules, regulations and orders of the
United States and the State of California. The Contractor agrees to indemnify the State
against any loss, cost, damage, or liability by reason of the Contractors violation of this
provision.
The State will notify the Contractor of any such claim in writing and tender the defense
thereof within a reasonable time; and
The Contractor will have sole control of the defense of any action on such claim and all
negotiations for its settlement or compromise; provided that (i) when substantial principles
of government or public law are involved, when litigation might create precedent affecting
future State operations or liability, or when involvement of the State is otherwise
mandated by law, the State may participate in such action at its own expense with respect
to attorneys’ fees and costs (but not liability); (ii) where a settlement would impose liability
on the State, affect principles of California government or public law, or impact the
authority of the State, the Department of General Services will have the right to approve
or disapprove any settlement or compromise, which approval will not unreasonably be
withheld or delayed and (iii) the State will reasonably cooperate in the defense and in any
related settlement negotiations.
If this Contract is in excess of $554,000, it is subject to the requirements of the World
Trade Organization (WTO) Government Procurement Agreement (GPA).
To the extent that this Contract falls within the scope of Government Code Section 11135,
the Contractor hereby agrees to respond to and resolve any complaint brought to its
attention, regarding accessibility of its products or services.
8. CONTRACTOR’S POWER AND AUTHORITY: The Contractor warrants that it has full power
and authority to grant the rights herein granted and will hold the State harmless from and
against any loss, cost, liability, and expense (including reasonable attorney fees) arising out of
any breach of this warranty. Further, the Contractor avers that it will not enter into any
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arrangement with any third-party which might abridge any rights of the State under this
Contract.
The State will notify the Contractor of any such claim in writing and tender the defense
thereof within a reasonable time; and
The Contractor will have sole control of the defense of any action on such claim and all
negotiations for its settlement or compromise; provided that (i) when substantial principles
of government or public law are involved, when litigation might create precedent affecting
future State operations or liability, or when involvement of the State is otherwise
mandated by law, the State may participate in such action at its own expense with respect
to attorneys’ fees and costs (but not liability); (ii) where a settlement would impose liability
on the State, affect principles of California government or public law, or impact the
authority of the State, the Department of General Services will have the right to approve
or disapprove any settlement or compromise, which approval will not unreasonably be
withheld or delayed; and (iii) the State will reasonably cooperate in the defense and in any
related settlement negotiations.
9. ASSIGNMENT: This Contract shall not be assignable by the Contractor in whole or in part
without the written consent of the State. The State’s consent shall not be unreasonably
withheld or delayed. For the purpose of this paragraph, the State will not unreasonably prohibit
the Contractor from freely assigning its right to payment, provided that the Contractor remains
responsible for its obligations hereunder.
10. WAIVER OF RIGHTS: Any action or inaction by the State or the failure of the State on any
occasion, to enforce any right or provision of the Contract, shall not be construed to be a
waiver by the State of its rights hereunder and shall not prevent the State from enforcing such
provision or right on any future occasion. The rights and remedies of the State herein are
cumulative and are in addition to any other rights or remedies that the State may have at law
or in equity.
11. ORDER OF PRECEDENCE: In the event of any inconsistency between the articles,
attachments, specifications, or provisions which constitute this Contract, the following order of
precedence shall apply:
These General Provisions – Information Technology (In the instances provided herein
where the paragraph begins: “Unless otherwise specified in the Statement of Work”
provisions specified in the Statement of Work replacing these paragraphs shall take
precedence over the paragraph referenced in these General Provisions);
Contract form, i.e., Purchase Order STD 65, Standard Agreement STD 213, etc., and any
amendments thereto;
Other Special Provisions;
Statement of Work, including any specifications incorporated by reference herein;
Cost worksheets; and
All other attachments incorporated in the Contract by reference.
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12. PACKING AND SHIPMENT:
All Goods are to be packed in suitable containers for protection in shipment and storage,
and in accordance with applicable specifications. Each container of a multiple container
shipment shall be identified to:
i. show the number of the container and the total number of containers in the
shipment; and
ii. the number of the container in which the packing sheet has been enclosed.
All shipments by the Contractor or its subcontractors must include packing sheets
identifying: the State’s Contract number; item number; quantity and unit of measure; part
number and description of the Goods shipped; and appropriate evidence of inspection, if
required. Goods for different Contracts shall be listed on separate packing sheets.
Shipments must be made as specified in this Contract, as it may be amended, or
otherwise directed in writing by the State’s Transportation Management Unit within the
Department of General Services, Procurement Division.
13. TRANSPORTATION COSTS AND OTHER FEES OR EXPENSES: No charge for delivery,
drayage, express, parcel post, packing, cartage, insurance, license fees, permits, cost of
bonds, or for any other purpose will be paid by the State unless expressly included and
itemized in the Contract.
The Contractor must strictly follow Contract requirements regarding Free on Board
(F.O.B.), freight terms and routing instructions. The State may permit use of an alternate
carrier at no additional cost to the State with advance written authorization of the Buyer.
If “prepay and add” is selected, supporting freight bills are required when over $50, unless
an exact freight charge is approved by the Transportation Management Unit within the
Department of General Services Procurement Division and a waiver is granted.
On "F.O.B. Shipping Point" transactions, should any shipments under the Contract be
received by the State in a damaged condition and any related freight loss and damage
claims filed against the carrier or carriers be wholly or partially declined by the carrier or
carriers with the inference that damage was the result of the act of the shipper such as
inadequate packaging or loading or some inherent defect in the Equipment and/or
material, the Contractor, on request of the State, shall at Contractor's own expense assist
the State in establishing carrier liability by supplying evidence that the Equipment and/or
material was properly constructed, manufactured, packaged, and secured to withstand
normal transportation conditions.
14. DELIVERY: The Contractor shall strictly adhere to the delivery and completion schedules
specified in this Contract. Time, if stated as a number of days, shall mean calendar days
unless otherwise specified. The quantities specified herein are the only quantities required. If
the Contractor delivers in excess of the quantities specified herein, the State shall not be
required to make any payment for the excess Deliverables and may return them to Contractor
at the Contractor’s expense or utilize any other rights available to the State at law or in equity.
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15. SUBSTITUTIONS: Substitution of Deliverables may not be tendered without advance written
consent of the Buyer. The Contractor shall not use any specification in lieu of those contained
in the Contract without written consent of the Buyer.
16. INSPECTION, ACCEPTANCE AND REJECTION: Unless otherwise specified in the
Statement of Work:
When acquiring Commercial Hardware or Commercial Software, the State shall rely on
Contractor’s existing quality assurance system as a substitute for State inspection and
testing. For all other acquisitions, Contractor and its subcontractors will provide and
maintain a quality assurance system acceptable to the State covering Deliverables and
services under this Contract and will tender to the State only those Deliverables that have
been inspected and found to conform to this Contract’s requirements. The Contractor will
keep records evidencing inspections and their result and will make these records
available to the State during Contract performance and for three years after final
payment. The Contractor shall permit the State to review procedures, practices,
processes, and related documents to determine the acceptability of the Contractor’s
quality assurance System or other similar business practices related to performance of
the Contract.
All Deliverables may be subject to inspection and test by the State or its authorized
representatives.
The Contractor and its subcontractors shall provide all reasonable facilities for the safety
and convenience of inspectors at no additional cost to the State. The Contractor shall
furnish to inspectors all information and data as may be reasonably required to perform
their inspection.
Subject to subsection 16 (a) above, all Deliverables may be subject to final inspection,
test and acceptance by the State at destination, notwithstanding any payment or
inspection at source.
The State shall give written notice of rejection of Deliverables delivered or services
performed hereunder within a reasonable time after receipt of such Deliverables or
performance of such services. Such notice of rejection will state the respects in which the
Deliverables do not substantially conform to their specifications. If the State does not
provide such notice of rejection within fifteen (15) days of delivery for purchases of
Commercial Hardware or Commercial Software or thirty (30) days of delivery for all other
purchases, such Deliverables and services will be deemed to have been accepted.
Acceptance by the State will be final and irreversible, except as it relates to latent defects,
fraud, and gross mistakes amounting to fraud. Acceptance shall not be construed to
waive any warranty rights that the State might have at law or by express reservation in
this Contract with respect to any nonconformity.
Unless otherwise specified in the Statement of Work, title to Equipment shall remain with
the Contractor and assigns, if any, until such time as successful acceptance testing has
been achieved. Title to a special feature installed on a Machine and for which only a
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single installation charge was paid shall pass to the State at no additional charge,
together with title to the Machine on which it was installed.
17. SAMPLES:
Samples of items may be required by the State for inspection and specification testing
and must be furnished free of expense to the State. The samples furnished must be
identical in all respects to the products bid and/or specified in the Contract.
Samples, if not destroyed by tests, may, upon request made at the time the sample is
furnished, be returned at the Contractor’s expense.
18. WARRANTY:
Unless otherwise specified in the Statement of Work, the warranties in this subsection a)
begin upon delivery of the goods or services in question and end one (1) year thereafter.
The Contractor warrants that (i) Deliverables and services furnished hereunder will
substantially conform to the requirements of this Contract (including without limitation all
descriptions, specifications, and drawings identified in the Statement of Work), and (ii) the
Deliverables will be free from material defects in materials and workmanship. Where the
parties have agreed to design specifications (such as a Detailed Design Document) and
incorporated the same or equivalent in the Statement of Work directly or by reference, the
Contractor will warrant that it’s Deliverables provide all material functionality required
thereby. In addition to the other warranties set forth herein, where the Contract calls for
delivery of Commercial Software, the Contractor warrants that such Software will perform
in accordance with its license and accompanying Documentation. The State’s approval of
designs or specifications furnished by Contractor shall not relieve the Contractor of its
obligations under this warranty.
The Contractor warrants that Deliverables furnished hereunder (i) will be free, at the time
of delivery, of harmful code (i.e., computer viruses, worms, trap doors, time bombs,
disabling code, or any similar malicious mechanism designed to interfere with the
intended operation of, or cause damage to, computers, data, or Software); and (ii) will not
infringe or violate any U.S. Intellectual Property Right. Without limiting the generality of
the foregoing, if the State believes that harmful code may be present in any Commercial
Software delivered hereunder, the Contractor will, upon the State’s request, provide a
new or clean install of the Software.
Unless otherwise specified in the Statement of Work:
i. The Contractor does not warrant that any Software provided hereunder is error-
free or that it will run without immaterial interruption.
ii. The Contractor does not warrant and will have no responsibility for a claim to the
extent that it arises directly from (A) a modification made by the State, unless
such modification is approved or directed by the Contractor, (B) use of Software
in combination with or on products other than as specified by the Contractor, or
(C) misuse by the State.
iii. Where the Contractor resells Commercial Hardware or Commercial Software it
purchased from a third-party, Contractor, to the extent it is legally able to do so,
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will pass through any such third-party warranties to the State and will reasonably
cooperate in enforcing them. Such warranty pass-through will not relieve the
Contractor from Contractor’s warranty obligations set forth above.
All warranties, including special warranties specified elsewhere herein, shall inure to the
State, its successors, assigns, customer agencies, and governmental users of the
Deliverables or services.
Except as may be specifically provided in the Statement of Work or elsewhere in this
Contract, for any breach of the warranties provided in this Section, the State’s exclusive
remedy and the Contractor’s sole obligation will be limited to:
i. re-performance, repair, or replacement of the nonconforming Deliverable
(including without limitation an infringing Deliverable) or service; or
ii. should the State in its sole discretion consent, refund of all amounts paid by the
State for the nonconforming Deliverable or service and payment to the State of
any additional amounts necessary to equal the State’s Cost to Cover. “Cost to
Cover” means the cost, properly mitigated, of procuring Deliverables or services
of equivalent capability, function, and performance. The payment obligation in
subsection (e)(ii) above will not exceed the limits on the Contractor’s liability set
forth in the Section entitled “Limitation of Liability.”
EXCEPT FOR THE EXPRESS WARRANTIES SPECIFIED IN THIS SECTION, THE
CONTRACTOR MAKES NO WARRANTIES EITHER EXPRESS OR IMPLIED,
INCLUDING WITHOUT LIMITATION ANY IMPLIED WARRANTIES OF
MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE.
19. SAFETY AND ACCIDENT PREVENTION: In performing work under this Contract on State
premises, the Contractor shall conform to any specific safety requirements contained in the
Contract or as required by law or regulation. The Contractor shall take any additional
precautions as the State may reasonably require for safety and accident prevention purposes.
Any violation of such rules and requirements, unless promptly corrected, shall be grounds for
termination of this Contract in accordance with the default provisions hereof.
20. INSURANCE: The Contractor shall maintain all commercial general liability insurance,
workers’ compensation insurance and any other insurance required under the Contract. The
Contractor shall furnish insurance certificate(s) evidencing required insurance coverage
acceptable to the State, including endorsements showing the State as an “additional insured” if
required under the Contract. Any required endorsements requested by the State must be
separately provided; merely referring to such coverage on the certificates(s) is insufficient for
this purpose. When performing work on state owned or controlled property, Contractor shall
provide a waiver of subrogation in favor of the State for its workers’ compensation policy.
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21. TERMINATION FOR NON-APPROPRIATION OF FUNDS:
If the term of this Contract extends into fiscal years subsequent to that in which it is
approved, such continuation of the Contract is contingent on the appropriation of funds for
such purpose by the Legislature. If funds to affect such continued payment are not
appropriated, the Contractor agrees to take back any affected Deliverables furnished
under this Contract, terminate any services supplied to the State under this Contract, and
relieve the State of any further obligation thereof.
The State agrees that if it appears likely that subsection a) above will be invoked, the
State and Contractor shall agree to take all reasonable steps to prioritize work and
Deliverables and minimize the incurrence of costs prior to the expiration of funding for this
Contract.
THE STATE AGREES THAT IF PARAGRAPH a) ABOVE IS INVOKED, COMMERCIAL
HARDWARE AND SOFTWARE THAT HAS NOT BEEN PAID FOR SHALL BE
RETURNED TO THE CONTRACTOR IN SUBSTANTIALLY THE SAME CONDITION IN
WHICH DELIVERED TO THE STATE, SUBJECT TO NORMAL WEAR AND TEAR. THE
STATE FURTHER AGREES TO PAY FOR PACKING, CRATING, TRANSPORTATION
TO THE CONTRACTOR’S NEAREST FACILITY AND FOR REIMBURSEMENT TO THE
CONTRACTOR FOR EXPENSES INCURRED FOR THEIR ASSISTANCE IN SUCH
PACKING AND CRATING.
22. TERMINATION FOR THE CONVENIENCE OF THE STATE:
The State may terminate performance of work under this Contract for its convenience in
whole or, from time to time, in part, if the Department of General Services, Deputy
Director Procurement Division, or designee, determines that a termination is in the State’s
interest. The Department of General Services, Deputy Director, Procurement Division, or
designee shall terminate by delivering to the Contractor a Notice of Termination
specifying the extent of termination and the effective date thereof.
After receipt of a Notice of Termination, and except as directed by the State, the
Contractor shall immediately proceed with the following obligations, as applicable,
regardless of any delay in determining or adjusting any amounts due under this clause.
The Contractor shall:
i. Stop work as specified in the Notice of Termination.
ii. Place no further subcontracts for materials, services, or facilities, except as
necessary to complete the continuing portion of the Contract.
iii. Terminate all subcontracts to the extent they relate to the work terminated.
iv. Settle all outstanding liabilities and termination settlement proposals arising from
the termination of subcontracts.
After termination, the Contractor shall submit a final termination settlement proposal to the
State in the form and with the information prescribed by the State. The Contractor shall
submit the proposal promptly, but no later than 90 days after the effective date of
termination, unless a different time is provided in the Statement of Work or in the Notice
of Termination.
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The Contractor and the State may agree upon the whole or any part of the amount to be
paid as requested under subsection (c) above.
Unless otherwise set forth in the Statement of Work, if the Contractor and the State fail to
agree on the amount to be paid because of the termination for convenience, the State will
pay the Contractor the following amounts; provided that in no event will total payments
exceed the amount payable to the Contractor if the Contract had been fully performed:
i. The Contract price for Deliverables or services accepted or retained by the State
and not previously paid for, adjusted for any savings on freight and other
charges; and
ii. The total of:
A. The reasonable costs incurred in the performance of the work terminated,
including initial costs and preparatory expenses allocable thereto, but
excluding any cost attributable to Deliverables or services paid or to be
paid;
B. The reasonable cost of settling and paying termination settlement
proposals under terminated subcontracts that are properly chargeable to
the terminated portion of the Contract; and
C. Reasonable storage, transportation, demobilization, unamortized
overhead and capital costs, and other costs reasonably incurred by the
Contractor in winding down and terminating its work.
The Contractor will use generally accepted accounting principles, or accounting principles
otherwise agreed to in writing by the parties, and sound business practices in determining
all costs claimed, agreed to, or determined under this clause.
23. TERMINATION FOR DEFAULT:
The State may, subject to the clause titled “Force Majeure” and to sub-section d) below,
by written notice of default to the Contractor, terminate this Contract in whole or in part if
the Contractor fails to:
i. Deliver the Deliverables or perform the services within the time specified in the
Contract or any amendment thereto;
ii. Make progress, so that the lack of progress endangers performance of this
Contract; or
iii. Perform any of the other provisions of this Contract.
The State’s right to terminate this Contract under sub-section a) above, may be exercised
only if the failure constitutes a material breach of this Contract and if the Contractor does
not cure such failure within the time frame stated in the State’s cure notice, which in no
event will be less than fifteen (15) days, unless the Statement of Work calls for a different
period.
If the State terminates this Contract in whole or in part pursuant to this Section, it may
acquire, under terms and in the manner the Buyer considers appropriate, Deliverables or
services similar to those terminated, and the Contractor will be liable to the State for any
excess costs for those Deliverables and services, including without limitation costs third-
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party vendors charge for Manufacturing Materials (but subject to the clause entitled
“Limitation of Liability”). However, the Contractor shall continue the work not terminated.
If the Contract is terminated for default, the State may require the Contractor to transfer
title, or in the case of licensed Software, license, and deliver to the State, as directed by
the Buyer, any:
i. completed Deliverables,
ii. partially completed Deliverables, and,
iii. subject to provisions of sub-section e) below, Manufacturing Materials related to
the terminated portion of this Contract. Nothing in this sub-section d) will be
construed to grant the State rights to Deliverables that it would not have received
had this Contract been fully performed. Upon direction of the Buyer, the
Contractor shall also protect and preserve property in its possession in which the
State has an interest.
The State shall pay Contract price for completed Deliverables delivered and accepted and
items the State requires the Contractor to transfer under section (d) above. Unless the
Statement of Work calls for different procedures or requires no-charge delivery of
materials, the Contractor and Buyer shall attempt to agree on the amount of payment for
Manufacturing Materials and other materials delivered and accepted by the State for the
protection and preservation of the property; provided that where the Contractor has billed
the State for any such materials, no additional charge will apply. Failure to agree will
constitute a dispute under the Disputes clause. The State may withhold from these
amounts any sum it determines to be necessary to protect the State against loss because
of outstanding liens or claims of former lien holders.
If, after termination, it is determined by a final decision that the Contractor was not in
default, the rights and obligations of the parties shall be the same as if the termination
had been issued for the convenience of the State.
Both parties, State and Contractor, upon any termination for default, have a duty to
mitigate the damages suffered by it.
The rights and remedies of the State in this clause are in addition to any other rights and
remedies provided by law or under this Contract and are subject to the clause titled
“Limitation of Liability.”
24. FORCE MAJEURE: Except for defaults of subcontractors at any tier, the Contractor shall not
be liable for any excess costs if the failure to perform the Contract arises from causes beyond
the control and without the fault or negligence of the Contractor. Examples of such causes
include, but are not limited to:
Acts of God or of the public enemy, and
Acts of the federal or State government in either its sovereign or contractual capacity.
If the failure to perform is caused by the default of a subcontractor at any tier, and if the cause
of the default is beyond the control of both the Contractor and subcontractor, and without the
fault or negligence of either, the Contractor shall not be liable for any excess costs for failure to
perform.
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25. RIGHTS AND REMEDIES OF STATE FOR DEFAULT:
In the event any Deliverables furnished, or services provided by the Contractor in the
performance of the Contract should fail to conform to the requirements herein, or to the
sample submitted by the Contractor, the State may reject the same, and it shall become
the duty of the Contractor to reclaim and remove the item promptly or to correct the
performance of services, without expense to the State, and immediately replace all such
rejected items with others conforming to the Contract.
In addition to any other rights and remedies the State may have, the State may require
the Contractor, at Contractor’s expense, to ship Deliverables via air freight or expedited
routing to avoid or minimize actual or potential delay if the delay is the fault of the
Contractor.
In the event of the termination of the Contract, either in whole or in part, by reason of
default or breach by the Contractor, any loss or damage sustained by the State in
procuring any items which the Contractor agreed to supply shall be borne and paid for by
the Contractor (but subject to the clause entitled “Limitation of Liability”).
The State reserves the right to offset the reasonable cost of all damages caused to the
State against any outstanding invoices or amounts owed to the Contractor or to make a
claim against the Contractor.
26. LIMITATION OF LIABILITY:
Except as may be otherwise approved by the Department of General Services Deputy
Director, Procurement Division or their designee, Contractor’s liability for damages to the
State for any cause whatsoever, and regardless of the form of action, whether in Contract
or in tort, shall be limited to the Purchase Price. For purposes of this sub-section a),
“Purchase Price” will mean the aggregate Contract price; except that, with respect to a
Contract under which multiple purchase orders will be issued (e.g., a Master Agreement
or Multiple Award Schedule contract), “Purchase Price” will mean the total price of the
purchase order for the Deliverable(s) or service(s) that gave rise to the loss, such that the
Contractor will have a separate limitation of liability for each purchase order.
The foregoing limitation of liability shall not apply (i) to any liability under the General
Provisions entitled “Compliance with Statutes and Regulations”; (ii) to liability under the
General Provisions, entitled “Patent, Copyright, and Trade Secret Indemnity” or to any
other liability (including without limitation indemnification obligations) for infringement of
third-party intellectual property rights; (iii) to claims arising under provisions herein calling
for indemnification for third-party claims against the State for death, bodily injury to
persons or damage to real or tangible personal property caused by the Contractor’s
negligence or willful misconduct; or (iv) to costs or attorney’s fees that the State becomes
entitled to recover as a prevailing party in any action.
The State’s liability for damages for any cause whatsoever, and regardless of the form of
action, whether in Contract or in tort, shall be limited to the Purchase Price, as that term is
defined in subsection a) above. Nothing herein shall be construed to waive or limit the
State’s sovereign immunity or any other immunity from suit provided by law.
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In no event will either the Contractor or the State be liable for consequential, incidental,
indirect, special, or punitive damages, even if notification has been given as to the
possibility of such damages, except (i) to the extent that the Contractor’s liability for such
damages is specifically set forth in the Statement of Work or (ii) to the extent that the
Contractor’s liability for such damages arises out of sub- section b)(i), b)(ii), or b)(iv)
above.
27. CONTRACTOR’S LIABILITY FOR INJURY TO PERSONS OR DAMAGE TO PROPERTY:
The Contractor shall be liable for damages arising out of injury to the person and/or
damage to the property of the State, employees of the State, persons designated by the
State for training, or any other person(s) other than agents or employees of the
Contractor, designated by the State for any purpose, prior to, during, or subsequent to
delivery, installation, acceptance, and use of the Deliverables either at the Contractor’s
site or at the State’s place of business, provided that the injury or damage was caused by
the fault or negligence of the Contractor.
The Contractor shall not be liable for damages arising out of or caused by an alteration or
an Attachment not made or installed by the Contractor, or for damage to alterations or
Attachments that may result from the normal operation and maintenance of the
Deliverables provided by the Contractor during the Contract.
28. INDEMNIFICATION: The Contractor agrees to indemnify, defend and save harmless the
State, its officers, agents and employees from any and all third-party claims, costs (including
without limitation reasonable attorneys’ fees), and losses due to the injury or death of any
individual, or the loss or damage to any real or tangible personal property, resulting from the
willful misconduct or negligent acts or omissions of the Contractor or any of its affiliates,
agents, subcontractors, employees, suppliers, or laborers furnishing or supplying work,
services, materials, or supplies in connection with the performance of this Contract. Such
defense and payment will be conditional upon the following:
The State will notify the Contractor of any such claim in writing and tender the defense
thereof within a reasonable time; and
The Contractor will have sole control of the defense of any action on such claim and all
negotiations for its settlement or compromise; provided that (i) when substantial principles
of government or public law are involved, when litigation might create precedent affecting
future State operations or liability, or when involvement of the State is otherwise
mandated by law, the State may participate in such action at its own expense with respect
to attorneys’ fees and costs (but not liability); (ii) where a settlement would impose liability
on the State, affect principles of California government or public law, or impact the
authority of the State, the Department of General Services will have the right to approve
or disapprove any settlement or compromise, which approval will not unreasonably be
withheld or delayed; and (iii) the State will reasonably cooperate in the defense and in any
related settlement negotiations.
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29. INVOICES: Unless otherwise specified, invoices shall be sent to the address set forth herein.
Invoices shall be submitted in triplicate and shall include the Contract number; release order
number (if applicable); item number; unit price, extended item price and invoice total amount.
State sales tax and/or use tax shall be itemized separately and added to each invoice as
applicable.
30. REQUIRED PAYMENT DATE: Payment will be made in accordance with the provisions of the
California Prompt Payment Act, Government Code Section 927 et seq. Unless expressly
exempted by statute, the Act requires State agencies to pay properly submitted, undisputed
invoices not more than 45 days after (i) the date of acceptance of Deliverables or performance
of services; or (ii) receipt of an undisputed invoice, whichever is later.
31. TAXES: Unless otherwise required by law, the State of California is exempt from Federal
excise taxes. The State will only pay for any State or local sales or use taxes on the services
rendered or Goods supplied to the State pursuant to this Contract.
32. NEWLY MANUFACTURED GOODS: All Goods furnished under this Contract shall be newly
manufactured Goods or certified as new and warranted as new by the manufacturer; used or
reconditioned Goods are prohibited, unless otherwise specified.
33. CONTRACT MODIFICATION: No amendment or variation of the terms of this Contract shall
be valid unless made in writing, signed by the parties, and approved as required. No oral
understanding or agreement not incorporated in the Contract is binding on any of the parties.
34. CONFIDENTIALITY OF DATA: All financial statistical, personal, technical and other data and
information relating to the State’s operation which are designated confidential by the state and
made available to the Contractor in order to carry out this Contract, or which become available
to the Contractor in carrying out this Contract, shall be protected by the Contractor from
unauthorized use and disclosure through the observance of the same or more effective
procedural requirements as are applicable to the State. The identification of all such
confidential data and information as well as the State's procedural requirements for protection
of such data and information from unauthorized use and disclosure shall be provided by the
State in writing to the Contractor. If the methods and procedures employed by the Contractor
for the protection of the Contractor's data and information are deemed by the State to be
adequate for the protection of the State's confidential information, such methods and
procedures may be used, with the written consent of the State, to carry out the intent of this
paragraph. The Contractor shall not be required under the provisions of this paragraph to keep
confidential any data or information which is or becomes publicly available, is already rightfully
in the Contractor's possession without obligation of confidentiality, is independently developed
by the Contractor outside the scope of this Contract or is rightfully obtained from third parties.
35. NEWS RELEASES: Unless otherwise exempted, news releases, endorsements, advertising,
and social media content pertaining to this Contract shall not be made without prior written
approval of the Department of General Services.
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36. DOCUMENTATION:
The Contractor agrees to provide to the State, at no charge, all Documentation as
described within the Statement of Work, and updated versions thereof, which are
necessary or useful to the State in its use of the Equipment or Software provided
hereunder. The Contractor agrees to provide additional Documentation at prices not in
excess of charges made by the Contractor to its other customers for similar
Documentation.
If the Contractor is unable to perform maintenance or the State desires to perform its own
maintenance on Equipment purchased under this Contract, then upon written notice by
the State the Contractor will provide at Contractor’s then current rates and fees adequate
and reasonable assistance including relevant Documentation to allow the State to
maintain the Equipment based on the Contractor’s methodology. The Contractor agrees
that the State may reproduce such Documentation for its own use in maintaining the
Equipment. If the Contractor is unable to perform maintenance, the Contractor agrees to
license any other Contractor that the State may have hired to maintain the Equipment to
use the above noted Documentation. The State agrees to include the Contractor’s
copyright notice on any such Documentation reproduced, in accordance with copyright
instructions to be provided by the Contractor.
37. RIGHTS IN WORK PRODUCT:
All inventions, discoveries, intellectual property, technical communications, and records
originated or prepared by the Contractor pursuant to this Contract including papers,
reports, charts, computer programs, and other Documentation or improvements thereto,
and including the Contractor’s administrative communications and records relating to this
Contract (collectively, the “Work Product”), shall be the Contractor’s exclusive property.
The provisions of this sub-section a) may be revised in a Statement of Work.
Software and other materials developed or otherwise obtained by or for the Contractor or
its affiliates independently of this Contract or applicable purchase order (“Pre-Existing
Materials”) do not constitute Work Product. If the Contractor creates derivative works of
Pre-Existing Materials, the elements of such derivative works created pursuant to this
Contract constitute Work Product, but other elements do not. Nothing in this Section 37
will be construed to interfere with the Contractor’s or its affiliates’ ownership of Pre-
Existing Materials.
The State will have Government Purpose Rights to the Work Product as Deliverable or
delivered to the State hereunder. “Government Purpose Rights” are the unlimited,
irrevocable, worldwide, perpetual, royalty-free, non-exclusive rights, and licenses to use,
modify, reproduce, perform, release, display, create derivative works from, and disclose
the Work Product. “Government Purpose Rights” also include the right to release or
disclose the Work Product outside the State for any State government purpose and to
authorize recipients to use, modify, reproduce, perform, release, display, create derivative
works from, and disclose the Work Product for any State government purpose. Such
recipients of the Work Product may include, without limitation, State Contractors,
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California local governments, the U.S. federal government, and the State and local
governments of other states. “Government Purpose Rights” do not include any rights to
use, modify, reproduce, perform, release, display, create derivative works from, or
disclose the Work Product for any commercial purpose.
The ideas, concepts, know-how, or techniques relating to data processing, developed
during the course of this Contract by the Contractor or jointly by the Contractor and the
State may be used by either party without obligation of notice or accounting.
This Contract shall not preclude the Contractor from developing materials outside this
Contract that are competitive, irrespective of their similarity to materials which might be
delivered to the State pursuant to this Contract.
38. SOFTWARE LICENSE: Unless otherwise specified in the Statement of Work, the Contractor
hereby grants to the State and the State accepts from the Contractor, subject to the terms and
conditions of this Contract, a perpetual, irrevocable, royalty-free, non-exclusive, license to use
the Software Products in this Contract (hereinafter referred to as “Software Products”).
The State may use the Software Products in the conduct of its own business, and any
division thereof.
The license granted above authorizes the State to use the Software Products in machine-
readable form on the Computer System located at the site(s) specified in the Statement of
Work. Said Computer System and its associated units (collectively referred to as CPU)
are as designated in the Statement of Work. If the designated CPU is inoperative due to
malfunction, the license herein granted shall be temporarily extended to authorize the
State to use the Software Products, in machine-readable form, on any other State CPU
until the designated CPU is returned to operation.
By prior written notice, the State may redesignate the CPU in which the Software
Products are to be used provided that the redesignated CPU is substantially similar in
size and scale at no additional cost. The redesignation shall not be limited to the original
site and will be effective upon the date specified in the notice of redesignation.
Acceptance of Commercial Software (including third-party Software) and Custom
Software will be governed by the terms and conditions of this Contract.
39. PROTECTION OF PROPRIETARY SOFTWARE AND OTHER PROPRIETARY DATA:
The State agrees that all material appropriately marked or identified in writing as
proprietary and furnished hereunder are provided for the State’s exclusive use for the
purposes of this Contract only. All such proprietary data shall remain the property of the
Contractor. The State agrees to take all reasonable steps to ensure that such proprietary
data are not disclosed to others, without prior written consent of the Contractor, subject to
the California Public Records Act.
The State will ensure, prior to disposing of any media, that any licensed materials
contained thereon have been erased or otherwise destroyed.
The State agrees that it will take appropriate action by instruction, agreement or otherwise
with its employees or other persons permitted access to licensed software and other
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proprietary data to satisfy its obligations in this Contract with respect to use, copying,
modification, protection and security of proprietary software and other proprietary data.
40. RIGHT TO COPY OR MODIFY:
Any Software Product provided by the Contractor in machine-readable form may be
copied, in whole or in part, in printed or machine-readable form for use by the State with
the designated CPU, to perform one-time benchmark tests, for archival or emergency
restart purposes, to replace a worn copy, to understand the contents of such machine-
readable material, or to modify the Software Product as provided below; provided,
however, that no more than the number of printed copies and machine-readable copies
as specified in the Statement of Work will be in existence under this Contract at any time
without prior written consent of the Contractor. Such consent shall not be unreasonably
withheld by the Contractor. The original, and any copies of the Software Product, in whole
or in part, which are made hereunder shall be the property of the Contractor.
The State may modify any non-personal computer Software Product, in machine-readable
form, for its own use and merge it into other program material. Any portion of the Software
Product included in any merged program material shall be used only on the designated
CPUs and shall be subject to the terms and conditions of the Contract.
41. FUTURE RELEASES: Unless otherwise specifically provided in this Contract, or the
Statement of Work, if improved versions, e.g., patches, bug fixes, updates, or releases, of any
Software Product are developed by the contractor, and are made available to other licensees,
they will be made available to the State at no additional cost only if such are made available to
other licensees at no additional cost. If the Contractor offers new versions or upgrades to the
Software Product, they shall be made available to the State at the State’s option at a price no
greater than the Contract price plus a price increase proportionate to the increase from the list
price of the original version to that of the new version, if any. If the Software Product has no list
price, such price increase will be proportionate to the increase in average price from the
original to the new version, if any, as estimated by the Contractor in good faith.
42. ENCRYPTION/CPU ID AUTHORIZATION CODES:
When Encryption/CPU Identification (ID) authorization codes are required to operate the
Software Products, the Contractor will provide all codes to the State with delivery of the
Software.
In case of inoperative CPU, the Contractor will provide a temporary encryption/CPU ID
authorization code to the State for use on a temporarily authorized CPU until the
designated CPU is returned to operation.
When changes in designated CPUs occur, the State will notify the Contractor via
telephone and/or facsimile/e-mail of such change. Upon receipt of such notice, the
Contractor will issue via telephone and/or facsimile/e-mail to the State within 24 hours, a
temporary encryption ID authorization code for use on the newly designated CPU until
such time as permanent code is assigned.
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43. PATENT, COPYRIGHT AND TRADE SECRET INDEMNITY:
Contractor will indemnify, defend, and save harmless the State, its officers, agents, and
employees, from any and all third-party claims, costs (including without limitation
reasonable attorneys’ fees), and losses for infringement or violation of any U.S.
Intellectual Property Right by any product or service provided hereunder. With respect to
claims arising from computer Hardware or Software manufactured by a third-party and
sold by Contractor as a reseller, Contractor will pass through to the State such indemnity
rights as it receives from such third-party (“Third-Party Obligation”) and will cooperate in
enforcing them; provided that if the third-party manufacturer fails to honor the Third-Party
Obligation, Contractor will provide the State with indemnity protection equal to that called
for by the Third-Party Obligation, but in no event greater than that called for in the first
sentence of this Section). The provisions of the preceding sentence apply only to third-
party computer Hardware or Software sold as a distinct unit and accepted by the State.
Unless a Third-Party Obligation provides otherwise, the defense and payment obligations
set forth in this Section will be conditional upon the following:
i. The State will notify the Contractor of any such claim in writing and tender the
defense thereof within a reasonable time; and
ii. The Contractor will have sole control of the defense of any action on such claim
and all negotiations for its settlement or compromise; provided that (a) when
substantial principles of government or public law are involved, when litigation
might create precedent affecting future State operations or liability, or when
involvement of the State is otherwise mandated by law, the State may participate
in such action at its own expense with respect to attorneys’ fees and costs (but
not liability); (b) where a settlement would impose liability on the State, affect
principles of California government or public law, or impact the authority of the
State, the Department of General Services will have the right to approve or
disapprove any settlement or compromise which approval will not unreasonably
be withheld or delayed; and (c) the State will reasonably cooperate in the
defense and in any related settlement negotiations.
Should the Deliverables, or the operation thereof, become, or in the Contractor’s
opinion are likely to become, the subject of a claim of infringement or violation of a
U.S. Intellectual Property Right, the State shall permit the Contractor, at its option
and expense, either to procure for the State the right to continue using the
Deliverables, or to replace or modify the same so that they become non-infringing. If
none of these options can reasonably be taken, or if the use of such Deliverables by
the State shall be prevented by injunction the Contractor agrees to take back such
Deliverables and make every reasonable effort to assist the State in procuring
substitute Deliverables. If, in the sole opinion of the State, the return of such
infringing Deliverables makes the retention of other Deliverables acquired from the
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Contractor under this Contract impractical, the State
shall then have the option of terminating such Contracts, or applicable portions
thereof, without penalty or termination charge. The Contractor agrees to take back
such
Deliverables and refund any sums the State has paid the Contractor less any
reasonable amount for use or damage.
The Contractor shall have no liability to the State under any provision of this clause
with respect to any claim of patent, copyright or trade secret infringement which is
based upon:
i. The combination or utilization of Deliverables furnished hereunder with
Equipment, Software, or devices not made or furnished by the Contractor;
or,
ii. The operation of Equipment furnished by the Contractor under the control of
any Operating Software other than, or in addition to, the current version of
Contractor-supplied Operating Software; or
iii. The modification initiated by the State, or a third-party at the State’s direction,
of any Deliverable furnished hereunder; or
iv. The combination or utilization of Software furnished hereunder with
non-contractor supplied Software.
The Contractor certifies that it has appropriate systems and controls in place to
ensure that State funds will not be used in the performance of this Contract for the
acquisition, operation, or maintenance of computer Software in violation of copyright
laws.
44. DISPUTES:
a) The parties shall deal in good faith and attempt to resolve potential disputes informally. If
the dispute persists, the Contractor shall submit to the contracting Department Director
or designee a written demand for a final decision regarding the disposition of any dispute
between the parties arising under, related to or involving this Contract. Contractor’s
written demand shall be fully supported by factual information, and if such demand
involves a cost adjustment to the Contract, the Contractor shall include with the demand
a written statement signed by an authorized person indicating that the demand is made
in good faith, that the supporting data are accurate and complete and that the amount
requested accurately reflects the Contract adjustment for which Contractor believes the
State is liable. The contracting Department Director or designee shall have 30 days after
receipt of Contractor’s written demand invoking this Section “Disputes” to render a
written decision. If a written decision is not rendered within 30 days after receipt of the
Contractor’s demand, it shall be deemed a decision adverse to the Contractor’s
contention. If the Contractor is not satisfied with the decision of the contracting
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b) Department Director or designee, the Contractor may appeal the decision, in writing,
within 15 days of its issuance (or the expiration of the 30 day period in the event no
decision is rendered by the contracting department), to the Department of General
Services, Deputy Director, Procurement Division, who shall have 45 days to render a
final decision. If the Contractor does not appeal the decision of the contracting
Department Director or designee, the decision shall be conclusive and binding regarding
the dispute and the Contractor shall be barred from commencing an action in court, or
with the Victims Compensation Government Claims Board, for failure to exhaust
Contractor’s administrative remedies.
Pending the final resolution of any dispute arising under, related to, or involving this
Contract, Contractor agrees to diligently proceed with the performance of this Contract,
including the delivery of Goods or providing of services in accordance with the State’s
instructions regarding this Contract. Contractor’s failure to diligently proceed in
accordance with the State’s instructions regarding this Contract shall be considered a
material breach of this Contract.
Any final decision of the State shall be expressly identified as such, shall be in writing,
and shall be signed by the Deputy Director, Procurement Division if an appeal was made.
If the Deputy Director, Procurement Division fails to render a final decision within 45 days
after receipt of the Contractor’s appeal for a final decision, it shall be deemed a final
decision adverse to the Contractor’s contentions. The State’s final decision shall be
conclusive and binding regarding the dispute unless the Contractor commences an action
in a court of competent jurisdiction to contest such decision within 90 days following the
date of the final decision or one (1) year following the accrual of the cause of action,
whichever is later.
For disputes involving purchases made by the Department of General Services,
Procurement Division, the Contractor shall submit to the Department Director or designee
a written demand for a final decision, which shall be fully supported in the manner
described in subsection a) above. The Department Director or designee shall have 30
days to render a final decision. If a final decision is not rendered within 30 days after
receipt of the Contractor’s demand, it shall be deemed a final decision adverse to the
Contractor’s contention. The final decision shall be conclusive and binding regarding the
dispute unless the Contractor commences an action in a court of competent jurisdiction to
contest such decision within 90 days following the date of the final decision or one (1)
year following the accrual of the cause of action, whichever is later.
The dates of decision and appeal in this section may be modified by mutual consent, as
applicable, excepting the time to commence an action in a court of competent jurisdiction.
45. STOP WORK:
The State may, at any time, by written Stop Work Order to the Contractor, require the
Contractor to stop all, or any part, of the work called for by this Contract for a period up to
45 days after the Stop Work Order is delivered to the Contractor, and for any further period
to which the parties may agree. The Stop Work Order shall be specifically
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identified as such and shall indicate it is issued under this clause. Upon receipt of the Stop
Work Order, the Contractor shall immediately comply with its terms and take all reasonable
steps to minimize the incurrence of costs allocable to the work covered by the Stop Work
Order during the period of work stoppage. Within a period of 45 days after a Stop Work Order
is delivered to the Contractor, or within any extension of that period to which the parties shall
have agreed, the State shall either:
i. Cancel the Stop Work Order; or
ii. Terminate the work covered by the Stop Work Order as provided for in the
termination for default or the termination for convenience clause of this Contract.
If a Stop Work Order issued under this clause is canceled or the period of the Stop Work
Order or any extension thereof expires, the Contractor shall resume work. The State shall
make an equitable adjustment in the delivery schedule, the Contract price, or both, and the
Contract shall be modified, in writing, accordingly, if:
i. The Stop Work Order results in an increase in the time required for, or in the
Contractor’s cost properly allocable to the performance of any part of this
Contract; and
ii. The Contractor asserts its right to an equitable adjustment within 60 days after
the end of the period of work stoppage; provided, that if the State decides the
facts justify the action, the State may receive and act upon a proposal submitted
at any time before final payment under this Contract.
If a Stop Work Order is not canceled and the work covered by the Stop Work Order is
terminated in accordance with the provision entitled Termination for the Convenience of
the State, the State shall allow reasonable costs resulting from the Stop Work Order in
arriving at the termination settlement.
The State shall not be liable to the Contractor for loss of profits because of a Stop Work
Order issued under this clause.
46. EXAMINATION AND AUDIT: The Contractor agrees that the State or its designated
representative shall have the right to review and copy any records and supporting
documentation directly pertaining to performance of this Contract. The Contractor agrees to
maintain such records for possible audit for a minimum of three (3) years after final payment
unless a longer period of records retention is stipulated. The Contractor agrees to allow the
auditor(s) access to such records during normal business hours and in such a manner so as to
not interfere unreasonably with normal business activities and to allow interviews of any
employees or others who might reasonably have information related to such records. Further,
the Contractor agrees to include a similar right of the State to audit records and interview staff
in any subcontract related to performance of this Contract. The State shall provide reasonable
advance written notice of such audit(s) to the Contractor.
47. FOLLOW-ON CONTRACTS:
If the Contractor or its affiliates provides Technical Consulting and Direction (as defined
below), the Contractor and its affiliates:
i. will not be awarded a subsequent Contract to supply the service or system, or
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any significant component thereof, that is used for or in connection with any
subject of such Technical Consulting and Direction; and
ii. will not act as consultant to any person or entity that does receive a Contract
described in sub-section (i). This prohibition will continue for one (1) year after
termination of this Contract or completion of the Technical Consulting and
Direction, whichever comes later.
“Technical Consulting and Direction” means services for which the Contractor received
compensation from the State and includes:
i. development of or assistance in the development of work statements,
specifications, solicitations, or feasibility studies;
ii. development or design of test requirements;
iii. evaluation of test data;
iv. direction of or evaluation of another Contractor;
v. provision of formal recommendations regarding the acquisition of Information
Technology products or services; or
vi. provisions of formal recommendations regarding any of the above. For purposes
of this Section, “affiliates” are employees, directors, partners, joint venture
participants, parent corporations, subsidiaries, or any other entity controlled by,
controlling, or under common control with the Contractor. Control exists when an
entity owns or directs more than fifty percent (50%) of the outstanding shares or
securities representing the right to vote for the election of directors or other
managing authority.
To the extent permissible by law, the Director of the Department of General Services, or
designee, may waive the restrictions set forth in this Section by written notice to the
Contractor if the Director determines their application would not be in the State’s best
interest. Except as prohibited by law, the restrictions of this Section will not apply:
i. to follow-on advice given by vendors of commercial off-the-shelf products,
including Software and Hardware, on the operation, integration, repair, or
maintenance of such products after sale; or
ii. where the State has entered into a master agreement for Software or services
and the scope of work at the time of Contract execution expressly calls for future
recommendations among the Contractor’s own products.
The restrictions set forth in this Section are in addition to conflict-of-interest restrictions
imposed on public Contractors by California law (“Conflict Laws”). In the event of any
inconsistency, such Conflict Laws override the provisions of this Section, even if enacted
after execution of this Contract.
48. PRIORITY HIRING CONSIDERATIONS: If this Contract includes services in excess of
$200,000, the Contractor shall give priority consideration in filling vacancies in positions funded
by the Contract to qualified recipients of aid under Welfare and Institutions Code Section
11200 in accordance with PCC Section 10353.
49. COVENANT AGAINST GRATUITIES: The Contractor warrants that no gratuities (in the form
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of entertainment, gifts, or otherwise) were offered or given by the Contractor, or any agent or
representative of the Contractor, to any officer or employee of the State with a view toward
securing the Contract or securing favorable treatment with respect to any determinations
concerning the performance of the Contract. For breach or violation of this warranty, the State
shall have the right to terminate the Contract, either in whole or in part, and any loss or
damage sustained by the State in procuring on the open market any items which the
Contractor agreed to supply shall be borne and paid for by the Contractor. The rights and
remedies of the State provided in this clause shall not be exclusive and are in addition to any other
rights and remedies provided by law or in equity.
50. NONDISCRIMINATION CLAUSE:
During the performance of this Contract, the Contractor and its subcontractors shall not
unlawfully discriminate, harass, or allow harassment, against any employee or applicant
for employment because of sex, sexual orientation, race, color, ancestry, religious creed,
national origin, disability (including HIV and AIDS), medical condition (cancer), age,
marital status, and denial of family care leave. The Contractor and subcontractors shall
ensure that the evaluation and treatment of their employees and applicants for
employment are free from such discrimination and harassment. The Contractor and
subcontractors shall comply with the provisions of the Fair Employment and Housing Act
(Government Code, Section 12990 et seq.) and the applicable regulations promulgated
thereunder (California Code of Regulations, Title 2, Section 7285.0 et seq.). The
applicable regulations of the Fair Employment and Housing Commission implementing
Government Code Section 12990 (a-f), set forth in Chapter 5 of Division 4 of Title 2 of the
California Code of Regulations are incorporated into this Contract by reference and made
a part hereof as if set forth in full. The Contractor and its subcontractors shall give written
notice of their obligations under this clause to labor organizations with which they have a
collective bargaining or other agreement.
The Contractor shall include the nondiscrimination and compliance provisions of this
clause in all subcontracts to perform work under the Contract.
51. NATIONAL LABOR RELATIONS BOARD CERTIFICATION: The Contractor swears under
penalty of perjury that no more than one final, unappealable finding of contempt of court by a
federal court has been issued against the Contractor within the immediately preceding two-
year period because of the Contractor’s failure to comply with an order of the National Labor
Relations Board. This provision is required by, and shall be construed in accordance with, PCC
Section 10296.
52. ASSIGNMENT OF ANTITRUST ACTIONS: Pursuant to Government Code Sections 4552,
4553, and 4554, the following provisions are incorporated herein:
In submitting a bid to the State, the supplier offers and agrees that if the bid is accepted, it
will assign to the State all rights, title, and interest in and to all causes of action it may
have under Section 4 of the Clayton Act (15 U.S.C. 15) or under the Cartwright Act
(Chapter 2, commencing with Section 16700, of Part 2 of Division 7 of the Business and
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Professions Code), arising from purchases of Goods, material or other items, or services
by the supplier for sale to the State pursuant to the solicitation. Such assignment shall be
made and become effective at the time the State tenders final payment to the supplier.
If the State receives, either through judgment or settlement, a monetary recovery for a
cause of action assigned under this chapter, the assignor shall be entitled to receive
reimbursement for actual legal costs incurred and may, upon demand, recover from the
State any portion of the recovery, including treble damages, attributable to overcharges
that were paid by the assignor but were not paid by the State as part of the bid price, less
the expenses incurred in obtaining that portion of the recovery.
Upon demand in writing by the assignor, the assignee shall, within one year from such
demand, reassign the cause of action assigned under this part if the assignor has been or
may have been injured by the violation of law for which the cause of action arose and
i. the assignee has not been injured thereby, or
ii. the assignee declines to file a court action for the cause of action.
53. DRUG-FREE WORKPLACE CERTIFICATION: The Contractor certifies under penalty of
perjury under the laws of the State of California that the Contractor will comply with the
requirements of the Drug-Free Workplace Act of 1990 (Government Code Section 8350 et
seq.) and will provide a drug-free workplace by taking the following actions:
Publish a statement notifying employees that unlawful manufacture, distribution,
dispensation, possession, or use of a controlled substance is prohibited and specifying
actions to be taken against employees for violations, as required by Government Code
Section 8355(a).
Establish a Drug-Free Awareness Program as required by Government Code Section
8355(b) to inform employees about all of the following:
i. the dangers of drug abuse in the workplace;
ii. the person's or organization's policy of maintaining a drug-free workplace;
iii. any available counseling, rehabilitation, and employee assistance programs; and,
iv. penalties that may be imposed upon employees for drug abuse violations.
Provide, as required by Government Code Section 8355(c), that every employee who
works on the proposed or resulting Contract:
i. will receive a copy of the company's drug-free policy statement; and,
ii. will agree to abide by the terms of the company's statement as a condition of
employment on the Contract.
54. FOUR-DIGIT DATE COMPLIANCE: Contractor warrants that it will provide only Four-Digit
Date Compliant (as defined below) Deliverables and/or services to the State. “Four Digit Date
Compliant” Deliverables and services can accurately process, calculate, compare, and
sequence date data, including without limitation date data arising out of or relating to leap
years and changes in centuries. This warranty and representation is subject to the warranty
terms and conditions of this Contract and does not limit the generality of warranty obligations
set forth elsewhere herein.
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55. SWEATFREE CODE OF CONDUCT:
Contractor declares under penalty of perjury that no equipment, materials, or supplies
furnished to the State pursuant to the Contract have been produced in whole or in part by
sweatshop labor, forced labor, convict labor, indentured labor under penal sanction,
abusive forms of child labor or exploitation of children in sweatshop labor, or with the
benefit of sweatshop labor, forced labor, convict labor, indentured labor under penal
sanction, abusive forms of child labor or exploitation of children in sweatshop labor. The
Contractor further declares under penalty of perjury that they adhere to the Sweatfree
Code of Conduct as set forth on the California Department of Industrial Relations website
located at www.dir.ca.gov, and Public Contract Code Section 6108.
The Contractor agrees to cooperate fully in providing reasonable access to its records,
documents, agents or employees, or premises if reasonably required by authorized
officials of the State, the Department of Industrial Relations, or the Department of Justice
to determine the Contractor’s compliance with the requirements under paragraph (a).
56. RECYCLED CONTENT REQUIRMENTS: The Contractor shall certify in writing under penalty
of perjury, the minimum, if not exact, percentage of post-consumer material (as defined in the
Public Contract Code (PCC) Section 12200-12209), in products, materials, goods, or supplies
offered or sold to the State that fall under any of the statutory categories regardless of whether
the product meets the requirements of Section 12209. The certification shall be provided by
the contractor, even if the product or good contains no postconsumer recycled material, and
even if the postconsumer content is unknown. With respect to printer or duplication cartridges
that comply with the requirements of Section 12156(e), the certification required by this
subdivision shall specify that the cartridges so comply (PCC 12205 (b)(2)). A state agency
contracting officer may waive the certification requirements if the percentage of postconsumer
material in the products, materials, goods, or supplies can be verified in a written
advertisement, including, but not limited to, a product label, a catalog, or a manufacturer or
vendor Internet web site. Contractors are to use, to the maximum extent economically feasible
in the performance of the contract work, recycled content products (PCC 12203(d)).
57. CHILD SUPPORT COMPLIANCE ACT: For any Contract in excess of $100,000, the
Contractor acknowledges in accordance with PCC Section 7110, that:
The Contractor recognizes the importance of child and family support obligations and
shall fully comply with all applicable State and federal laws relating to child and family
support enforcement, including, but not limited to, disclosure of information and
compliance with earnings assignment orders, as provided in Chapter 8 (commencing with
Section 5200) of Part 5 of Division 9 of the Family Code; and
The Contractor, to the best of its knowledge is fully complying with the earnings
assignment orders of all employees and is providing the names of all new employees to
the New Hire Registry maintained by the California Employment Development
Department.
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58. AMERICANS WITH DISABILITIES ACT: The Contractor assures the State that the Contractor
complies with the Americans with Disabilities Act of 1990 (42 U.S.C. 12101 et seq.).
59. ELECTRONIC WASTE RECYCLING ACT OF 2003: The Contractor certifies that it complies
with the applicable requirements of the Electronic Waste Recycling Act of 2003, Chapter 8.5,
Part 3 of Division 30, commencing with Section 42460 of the Public Resources Code. The
Contractor shall maintain documentation and provide reasonable access to its records and
documents that evidence compliance.
60. USE TAX COLLECTION: In accordance with PCC Section 10295.1, the Contractor certifies
that it complies with the requirements of Section 7101 of the Revenue and Taxation Code.
Contractor further certifies that it will immediately advise the State of any change in its retailer’s
seller’s permit or certification of registration or applicable affiliate’s seller’s permit or certificate
of registration as described in subdivision (a) of PCC Section 10295.1.
61. EXPATRIATE CORPORATIONS: Contractor hereby declares that it is not an expatriate
corporation or subsidiary of an expatriate corporation within the meaning of PCC Sections
10286 and 10286.1 and is eligible to contract with the State.
62. DOMESTIC PARTNERS: For contracts over $100,000 executed or amended after January 1,
2007, the contractor certifies that the contractor is in compliance with Public Contract Code
Section 10295.3.
63. SMALL BUSINESS PARTICIPATION AND DVBE PARTICIPATION REPORTING
REQUIREMENTS:
If for this Contract the Contractor made a commitment to achieve small business
participation, then the Department requires the Contractor upon completion of this
Contract (or within such other time period as may be specified elsewhere in this Contract)
to report the actual percentage of small business participation that was achieved. (Govt.
Code § 14841)
If for this Contract the Contractor made a commitment to achieve the disabled veteran
business enterprise (DVBE) participation goal, then, pursuant to Mil. & Vets. Code §
999.5(d), upon completion of this Contract, the Department requires the Contractor to
certify using the Prime Contractor’s Certification – DVBE Subcontracting Report (STD
817), all of the following:
i. the total amount the prime Contractor received under the Contract;
ii. the name, address, Contract number and certification ID number of the DVBE(s)
that participated in the performance of this Contract;
iii. the amount and percentage of work the prime Contractor committed to provide
to one or more DVBE(s) under the requirements of the Contract and the total
payment each DVBE received from the prime Contractor;
iv. that all payments under the Contract have been made to the DVBE(s); and
v. the actual percentage of DVBE participation that was achieved. Upon request,
the prime Contractor shall provide proof of payment for the work.
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If for this Contract the Contractor made a commitment to achieve the DVBE participation goal,
the Department will withhold $10,000 from the final payment, or the full final payment if less
than $10,000, until the Contractor complies with the certification requirements above. A
Contractor that fails to comply with the certification requirement shall, after written notice, be
allowed to cure the defect. Notwithstanding any other law, if, after at least 15 calendar days but
not more than 30 calendar days from the date of written notice, the prime contractor refuses to
comply with the certification requirements, the Department shall permanently deduct $10,000
from the final payment, or the full payment if less than $10,000. (Mil. & Vets. Code § 999.7)
A person or entity that knowingly provides false information shall be subject to a civil penalty
for each violation. (Mil. & Vets. Code § 999.5(d); Govt. Code § 14841)
Contractor agrees to comply with the rules, regulations, ordinances, and statutes that apply to
the DVBE program as defined in Section 999 of the Mil. & Vets. Code, including, but not limited
to, the requirements of Section 999.5(d). (PCC Code § 10230)
64. LOSS LEADER: It is unlawful for any person engaged in business within this state to sell or
use any article or product as a “loss leader” as defined in Section 17030 of the Business and
Professions Code. (PCC 12104.5(b).).
65. EXECUTIVE ORDER N-6-22-RUSSIA SANCTIONS: The Contractor shall comply with
Executive Order N-6-22 (the EO) regarding Economic Sanctions against Russia and
Russian entities and individuals. “Economic Sanctions” refers to sanctions imposed by the
U.S. government in response to Russia’s actions in Ukraine, as well as any sanctions
imposed under state law. The EO directs state agencies to terminate contracts with, and to
refrain from entering any new contracts with, individuals or entities that are determined to be
a target of Economic Sanctions. Accordingly, should the State determine Contractor is a
target of Economic Sanctions or is conducting prohibited transactions with sanctioned
individuals or entities, that shall be grounds for termination of this agreement. The State
shall provide Contractor advance written notice of such termination, allowing Contractor at
least 30 calendar days to provide a written response. Termination shall be at the sole
discretion of the State.
