Exhibit 10.79

[***] INDICATES MATERIAL THAT HAS BEEN OMITTED AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED MATERIAL HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 24b-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.

[***] INDICATES MATERIAL THAT HAS BEEN OMITTED AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED MATERIAL HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 24b-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.

THIS DOCUMENT IS THE PROPERTY OF HER BRITANNIC MAJESTY’S GOVERNMENT, and is issued for the information of such persons only as need to know its contents in the course of their official duties.  Any person finding this Document should hand it to a British forces unit or to a police station for its safe return to the MINISTRY OF DEFENCE, D Def Sy, Main Building, Whitehall, LONDON SW1A 2HB, with particulars of how it was found.  THE UNAUTHORIZED RETENTION OR DESTRUCTION OF THE Document MAY BE AN OFFENCE UNDER THE OFFICIAL SECRETS ACTS 1911-89.  (When released to persons outside Government service, this Document is issued on a personal basis.  The recipient to whom it is entrusted in confidence, within the provisions of the Official Secret Acts 1911-89, is personally responsible for its safe custody and for seeing that its contents are disclosed only to authorized persons.)

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[***] INDICATES MATERIAL THAT HAS BEEN OMITTED AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED MATERIAL HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 24b-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.

AMENDMENTS

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TABLE OF CONTENTS

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v

[***] INDICATES MATERIAL THAT HAS BEEN OMITTED AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED MATERIAL HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 24b-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.

vi

[***] INDICATES MATERIAL THAT HAS BEEN OMITTED AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED MATERIAL HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 24b-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.

vii

[***] INDICATES MATERIAL THAT HAS BEEN OMITTED AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED MATERIAL HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 24b-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.

DEFFORM 111 - Appendix to Contract - Addresses and Other Information

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[***] INDICATES MATERIAL THAT HAS BEEN OMITTED AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED MATERIAL HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 24b-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.

DEFCON 110

(Edn 4/88)

Table I     Articles Required

1

[***] INDICATES MATERIAL THAT HAS BEEN OMITTED AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED MATERIAL HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 24b-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.

Table II     Packaging requirements

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[***] INDICATES MATERIAL THAT HAS BEEN OMITTED AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED MATERIAL HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 24b-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.

CONDITIONS OF CONTRACT

GENERAL CONDITIONS

The following DEFCONs shall apply to this Contract, as modified below (where relevant):

DEFCON 501 (Edn.04/04) - Definitions and Interpretations

For the purposes of Sub-Clause 1.d) of DEFCON 501, the reference to ‘special conditions of contract’ shall be taken to mean the narrative conditions of the Contract.

The Commercial Manager and Project Manager designated by the Authority shall be those detailed at Boxes 1 & 2 of the DEFFORM 111 (Appendix to Contract).

DEFCON 503 (Edn.07/05) - Amendments to Contract

For the purposes of Clause 1 of DEFCON 503, the duly authorised representatives are:

(A) for the Authority, the Commercial Manager identified at Box 1 of the DEFFORM 111 (Appendix to Contract) or his authorised representative.

(B) for the Contractor, the Contractor’s head of Commercial or his authorised representative.

DEFCON 515 (Edn.10/04) - Bankruptcy and Insolvency

DEFCON 516 (Edn.06/04) - Racial Discrimination

DEFCON 518 (Edn.09/97) - Transfer

DEFCON 520 (Edn.08/09) - Corrupt Gifts and Payments of Commission

DEFCON 521 (Edn.10/04) - Sub-Contracting to Supported Employment Enterprises

DEFCON 526 (Edn.08/02) - Notices

DEFCON 527 (Edn.09/97) - Waiver

DEFCON 528 (Edn.10/04) - Overseas Expenditure and Import Licences

The Contractor’s attention is drawn to clause 1 of DEFCON 528 requiring notification of overseas expenditure.  In this connection, the Contractor shall, within one month of acceptance of the Contract, notify the Contracts Branch of details of any overseas sub-contract or order he has placed, or intends to place, in aid of the contract.  Details to be provided are: Contract No; Country in which sub-contract placed/to be placed; Name, Division and full postal address of sub-contractor; Value of sub-contract as applicable to main contract; Date placed/to be placed.  If no overseas orders are to be placed, the Contractor shall advise the Contracts Branch to this effect in the same timescale.

DEFCON 529 (Edn.09/97) - Law (English)

DEFCON 530 (Edn.07/04) - Dispute Resolution (English Law)

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[***] INDICATES MATERIAL THAT HAS BEEN OMITTED AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED MATERIAL HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 24b-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.

DEFCON 531 (Edn.05/05) - Disclosure of Information

DEFCON 537 (Edn.06/02) - Rights of Third Parties

DEFCON 538 (Edn.06/02) - Severability

DEFCON 566 (Edn.08/06) - Change of Control of Contractor

DEFCON 656 (Edn.03/06) - Break

DEFCON 659 (Edn.06/09) - Security Measures

DEFCON 691 (Interim Edn.08/02) - Timber and Wood-Containing Products Supplied under the Contract

Definitions and Interpretations

Notwithstanding, and in addition to, the provisions contained in DEFCON 501, the following expressions shall, in the Contract, have the meaning hereby respectively assigned to them, except where the context requires otherwise.

“Acceptance” means the process of demonstrating that the Articles meet the acceptance criteria in the Systems Requirement Document.

“Acceptance Criteria” means the criteria specified in the Systems Requirement Document at Annex B to the Contract.

“Active Risk Management Tool” means the risk management software package provided by QinetiQ Commerce Decisions.

“Agent” means a third party appointed by the Authority to complete an activity or service on the Authority’s behalf.

“As Low As Reasonably Practicable” or “ALARP” means, in relation to a risk, that it has been demonstrated that the cost of any further risk reduction, where the cost includes the loss of defence capability as well as financial or other resource costs, is grossly disproportionate to the benefit obtained from that risk reduction.

“Assurance Sign Off Certificate” means a certificate issued by the Authority pursuant to Clause 0.

“Authority Contracting Team’s Senior Commercial Manager” means the senior commercial manager within the Protected Mobility Team as notified to the Contractor from time to time.

“Authority’s Contracting Team Leader” means Director Commercial Land Equipment Defence Equipment & Supply as notified to the Contractor from time to time.

“Authority’s Project Manager” means the project manager assigned to LPPV from within the Protected Mobility Team as notified to the Contractor from time to time.

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[***] INDICATES MATERIAL THAT HAS BEEN OMITTED AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED MATERIAL HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 24b-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.

“Authority’s Representatives” means the Authority’s officers, directors, employees, advisers and agents and those parties set out in Annex N acting in accordance with their contractual obligations to the Authority.

“Authority’s Quality Assurance Requirements” means the quality assurance standards stated at Clause 0 of the Contract and Appendix F to Annex A to the Contract.

“Background IPR” means Intellectual Property Rights which were not generated in the performance of the work under the Contract.

“British Standard” means a national standard published by the British Standards Institute.

“Certificate of Conformity” means a document signed by the Contractor to certify that the Article being delivered to the Authority conforms fully to the requirements of the Contract or, where previously agreed with the Authority, lists any deviations from those requirements which shall be rectified by the Contractor.

“Change” means the deletion, amendment, alteration or addition to the extent of any rights or obligations under the Contract save where the terms of the Contract expressly state that such deletion, amendment, alternative or addition is not to constitute a Change.

“Change Notice” means a completed Change Notice Form providing details of a proposed change to the Contract in accordance with the process in Clause 0 of the Contract.

“Change Notice Form” means the form provided at Annex K to the Contract.

“Change Proposal” means the process in Clause 0 of this Contract.

“Concessions” means deviations from the Authority Quality Assurance Requirements agreed in accordance with Clause 0 of the Contract.

“Configuration Changes Management Group” shall have the meaning given to it in Clause 0.

“Configuration Management” means management of the configuration control process in accordance with Clause 0 of the Contract.

“Configuration Management Plan” means the Contractor’s plan for Configuration Management in the form set out in CDRL 38 to the Contract.

“Contract Amendment” means a mutually agreed change to the Contract made by duly authorised representatives of the Parties in accordance with DEFCON 503.

“Contractor’s Monthly Progress Report” has the meaning given to it in Annex II to the Contract.

“Data Item Description” means UK Data Item Descriptions provided as part of Defstan 00-600.

“Delivery Schedule” means the schedule at Annex I to the Contract defining the dates by which the Contractor is to deliver the Articles required under the Contract.

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[***] INDICATES MATERIAL THAT HAS BEEN OMITTED AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED MATERIAL HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 24b-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.

“Design Acceptance” means formal agreement by the Authority that the design of the Articles has been demonstrated to have reached Design Freeze in accordance with the process set out in Clause 0 of the Contract.

“Design Chill” means that the design has reached a stage of development prior to Design Freeze.

“Design Freeze” means that the design of the Article has reached compliance with the requirements of the System Requirements Document at Annex B to the Contract.

“Design Rights” means the Intellectual Property Rights contained in a design.

“E2A” shall have the meaning given to it in the SRD.

“Final System Acceptance” is defined as the point at which the Authority is satisfied that all System Requirements have been met to Threshold Measure Of Performance, as defined in the SRD at Annex B.

“Force Majeure Event” means any acts of nature, war, hostilities or any fire at any of the Contractor’s premise or those of his sub-contractors.

“Foreground IPR” all IPR including patents for any inventions generated in the performance of work under the Contract and patents for any inventions conceived out of the technical requirements of the Contract if these have been first enabled in the performance of work under the Contract.

“Foreign Government” means the government of any nation other than the United Kingdom of Great Britain and Northern Ireland.

“Good Industry Practice” means in relation to any part of the performance of the Contract and related circumstances, the exercise of that degree of skill, diligence, prudence and foresight which would reasonably and ordinarily be expected from a skilled and experienced contractor engaged in the same type of undertaking under the same or similar circumstances.

“Government Furnished Assets” or “GFA” is defined in Clause 0 of this Contract.

“Government Profit Formula” means the rate of profit as detailed in Ministry of Defence Guidelines for Industry 20 (Issue 2) - Implementing The 2003 General Review of the Profit Formula For Non-Competitive Government Contracts from 1 July 2004.

“Import Duty Waiver” means a waiver from import duty imposed by Her Majesty’s Revenue and Customs on articles imported from outside the European Union.

“Incident Sentencing Committee” means a panel consisting of authorised representatives of both Parties to jointly review reliability and maintenance trial information in accordance with Clause 0 of the Contract.

“Independent Safety Advisor” means a third party auditor appointed by the Authority to independently assess the Safety Case against the SRD.

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[***] INDICATES MATERIAL THAT HAS BEEN OMITTED AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED MATERIAL HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 24b-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.

“Intellectual Property Rights” or “IPR” means all patents utility models, rights (registered and unregistered) in any designs; applications for any of the foregoing; copyright; confidential information and trade secrets and all rights and forms of protection of a similar nature to these or having equivalent effect anywhere in the world.

“Jigs and Tools” means all tooling and manufacturing jigs purchased by the Contractor at the Authority’s expense in order to manufacture the Articles required by the Contract.

“Laws” means any applicable Act of Parliament, sub-ordinate legislation within the meaning of Section 21(1) of the Interpretation Act 1978, exercise of the Royal Prerogative, enforceable community right within the meaning of Section 2 of the European Communities Act 1972, bye-law, regulatory policy, guidance or industry code, judgement of a relevant court of law, or directives or requirements of any Regulatory Body with which the Contractor is bound to comply.

“Long Lead Items” means any components which the Authority has given the Contractor written approval to purchase in advance of the date of execution of the Contract.

“LPPV” means the Light Protected Patrol Vehicle Programme.

“LPPV Capability” means the capability to be provided by the Articles in accordance with the System Requirements Document.

“Manufacturing Licence Agreement” has the meaning defined in the US International Traffic In Arms Regulations (ITAR) 22 C.F.R. Chapter I, Subchapter M, Parts 120-130 §120.2.

“Millbrook” means the vehicle test facility at Millbrook, Bedfordshire, run at the date of execution of the Contract by Millbrook Proving Ground Limited.

“Narrative Conditions” means the clauses of the Contract but not including the annexes or DEFCONs.

“NATO Codification” means the process to distinguish unique Items of Supply from other items using the allocation of NATO Stock Numbers as defined in DEFCON 117.

“NATO Nation” means the government of a nation which is a member of the North Atlantic Treaty Organisation.

“Obsolescence Management Plan” means a plan to be managed and updated by the Contractor in accordance with the Statement of Work at Annex A and Clause 0 to address obsolescence.

“Option Items” means the additional Articles covered by Clause 0 of the Contract and detailed at Annex H to the Contract.

“Parties” means each of the Contractor and the Authority and “Party” means either of them as the context so admits.

“Personal Data” shall have the same meaning as in Section 1 of the Data Protection Act 1998.

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[***] INDICATES MATERIAL THAT HAS BEEN OMITTED AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED MATERIAL HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 24b-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.

“Prime Contractor” means - for the LPPV, the Contractor shall be the prime contractor with responsibility for performance and delivery of the Contract and management of any Sub-Contractors at all levels in the supply chain.

“Programme Schedules” means the programme for trials of the Articles and delivery schedule at Annex I.

“Project Review Meeting” means a meeting to be held between representatives of the Parties to monitor progress as more particularly set out in Annex II to the Contract.

“Quality Assurance Representative” or “QA Representative” means the Authority’s authorised representative charged with monitoring that quality assurance is conducted in accordance with the requirements of Clause 0 of the Contract, as notified to the Contractor from time to time.

“Quality Assurance Working Group” means a forum to be convened in accordance with Clause 0 to review performance against the quality assurance requirements.

“R&M Programme Plan” means a plan detailing the demonstration and testing activities required under Clause 0.

“Regulatory Body” means any local, national or supra—national authority, agency, inspectorate, minister, ministry, official, administrative or other regulatory body or public or statutory person of the government of the United Kingdom or of the European Union.

“Required Delivery Date” means, in respect of an Article, the relevant date set out in Annex I as the “Required Delivery Date” for that Article (as such date may be amended or adjusted from time to time in accordance with the terms of the Contract).

“Safety Case” means all of the documented information and arguments that substantiate the safety of the Articles to be delivered under the Contract and demonstrate that the relevant standards have been met and that risks have been reduced to ALARP.

“S&TE” or “Support and Test Equipment” means the equipment required to support the Articles, under exception of generic equipment held by the User (e.g. toolboxes as defined in the SRD and the ILS SOW).

“Senior Commercial Manager” means the Protected Mobility Team Assistant Team Leader - Commercial, as notified to the Contractor from time to time.

“Spares” means individual parts, sub-assemblies or assemblies supplied for the maintenance or repair of Articles.

“Standard Operating Procedures” means the Authority’s instructions to military personnel on use of the Articles.

“Statement of Work” means the statement of work as set out in Annex A.

“Sub-contractor” or “sub-contractor” means a sub-contractor of the Contractor of any tier.

“Sub-contract” or “sub-contract” means a sub-contract of any tier.

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[***] INDICATES MATERIAL THAT HAS BEEN OMITTED AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED MATERIAL HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 24b-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.

“Subject Matter Experts” or “SMEs” means individuals who by appointment are recognised by the Authority as possessing the necessary knowledge of a subject to confirm that a System Requirement or an area of the Statement of Work has been successfully verified.

“System Requirement” means any requirement that the Articles are to achieve as set out in the System Requirements Document.

“System Requirements Document” or “SRD” means the System Requirements Document set out in Annex B to the Contract.

“Technical Assistance Agreement” means Technical Assistance Agreement as such term is defined in the US International Traffic in Arms Regulations (ITAR) 22 C.F.R. Chapter I, Subchapter M, Parts 120-130 §120.22.

“Technical Documentation” means the publications required to support the Articles in service, as detailed in Item 4 and Annex C.

“UK Accreditation Service” means the United Kingdom Accreditation Service, the agency appointed by the UK Government to act as the national accreditation body under the Accreditation Regulations 2009.

“Unpriced Work” has the meaning given in Clause 0.

“User Trials” means the trials to be undertaken in accordance with the programme by the Authority’s Trial and Developments Units (CSSTDU, JADTDU and ITDU) to verify compliance of the Articles with the SRD.

“User Unit” has the meaning given to it in Clause 0.

“Work Package” means each of the separate work packages listed as a separate row in the Work Package Scheme.

“Work Package Payment” means in respect of a Work Package the relevant amount set out in the column headed ‘Work Package Payment’ of the Work Package Scheme.

“Work Package Scheme” means the schedule for payments under the Contract defined at Annex HH.

Documentation & Precedence

The Contractor shall check all documentation and immediately notify the Authority of any discrepancy, inconsistency or error.

Should there be any conflict in the Contract documentation, the order of precedence stated shall be as follows:

2.2.1.1          Narrative Conditions of the Contract;

2.2.1.2          DEFCONs of the Contract and any documents expressly called up by these;

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[***] INDICATES MATERIAL THAT HAS BEEN OMITTED AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED MATERIAL HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 24b-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.

2.2.1.3          Annex B to the Contract (Systems Requirement Document);

2.2.1.4          Any other Annexes to Contract other than Annex A;

2.2.1.5          Annex A to the Contract (Statement of Work); and

2.2.1.6          Any other documents referenced in the Contract.

In the event of any conflict in any document, or any conflict between documents with the same order of precedence, the Parties shall agree the proper construction of the documentation.  Should the Parties be unable to agree a resolution to the conflict, the matter shall be resolved in accordance with Clause 0 (save in relation to a conflict of terms within the Statement of Work where the Authority shall be entitled to decide which of the conflicting provisions shall take priority), following which the Authority shall issue a correction to the documentation and such construction or correction (as the case may be) shall be binding on the Contractor and the Authority with no adjustment to the Contract Price.

Export Licences

It shall be the sole responsibility of the Contractor to obtain in a timely manner any export licences required to perform any of its obligations under the Contract.

The Contractor shall inform the Authority at the earliest opportunity of the route by which he intends to obtain export licence approval from the Foreign Government in order to satisfy delivery requirements under the Contract in particular, where the Contractor chooses to use a Technical Assistance Agreement or Manufacturing Licence Agreement, he shall promptly notify the Authority and shall not seek Foreign Government approval for the Agreement until first negotiating its contents with the Authority.

Sub-Contracting

The Contractor shall ensure that the provisions of DEF-STAN 05-61 shall be extended to the placing and control of all Sub-contracts arising from this Contract.  A copy of each Sub-contract shall be supplied to the Authority on request.

The Contractor shall be responsible for the management of any Sub-contractors or agents and shall accept full responsibility for their performance.  The Sub-contracting of any obligation under this Contract shall not relieve or excuse the Contractor from its obligations to the Authority in respect of the due performance of such obligations.  The Contractor shall be responsible to the Authority for the acts or omissions of any Sub-contractor in relation to such Sub-contractor’s performance of this Contract and any such acts or omissions of the relevant Sub-contractor shall be regarded as an act or omission of the Contractor.

The Authority shall not intervene in disputes between the Contractor and its Sub-contractors, nor shall it deal directly with any Sub-contractor.  All approaches to the Authority shall only be made by the Contractor.

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[***] INDICATES MATERIAL THAT HAS BEEN OMITTED AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED MATERIAL HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 24b-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.

In the event that any Sub-contractor or Agent generates any Intellectual Property Rights, then the Contractor shall ensure that the Sub-contractor or Agent enters into an Agreement with the Authority in the form of a Design Rights and Patents Sub-contractors Agreement prior to commencement of any work (see Annex J).

Security Measures (With Security Aspects Letter)

For the purpose of DEFCON 659, the “Secret Matter” of the Contract shall be as defined in the Authority’s Security Aspects Letter reference PMT/0009 dated 25 November 2010 (the “Security Aspects Letter”).  Any changes in these classifications will be notified by the Authority with an amendment to the Security Aspects Letter.

Gainshare

The Authority and the Contractor shall during the period of the Contract identify all possible areas for savings which provide mutual benefit.  Such savings opportunities (referred to as “Gainshare”) are to be listed within the Contractor’s Monthly Progress Report.  The Authority and the Contractor agree to seek to achieve a year on year target of 5% reduction in the Articles prices as detailed in the Schedule of Requirements by way of efficiencies.

All Gainshare proposals shall be raised using the Change Proposal form set out at Annex K.

All Gainshare benefits shall be shared on a 50:50 basis between both parties, subject to the following:-

2.2.1.7          The non-recurring costs of any agreed Gainshare opportunity incurred during its investigation and implementation shall be offset against the agreed benefit;

2.2.1.8          The non-recurring costs incurred by the Contractor during the investigation of a proposed Gainshare opportunity which has been approved by the Authority following a Project Review Meeting, but where it is later decided by the Authority not to proceed with the Gainshare opportunity, shall be accepted as an extra cost to the Contract and shall be shared as set out in Clause 0 of this Contract.

A different benefit sharing basis shall be allowed for any Gainshare opportunity with the agreement of the Contractor and the Authority.  Where the Contractor believes a different basis is appropriate for any Gainshare opportunity he shall provide with his Gainshare proposal sufficient and reasonable information to justify a different basis.  The Authority agrees to review all such proposals.  Where the Authority and the Contractor agree, a different benefit sharing basis shall be allowed.  Where the Authority and Contractor do not agree a different sharing benefit basis the Authority shall provide reasonable justification to the Contractor for this decision.  Any change to the benefit sharing shall apply only to the Gainshare opportunity in question and any subsequent change from the 50:50 benefit sharing basis shall be agreed by this method for each Gainshare opportunity.

The non-recurring costs incurred by the Contractor during the investigation of a proposed Gainshare opportunity which has been approved by the Authority during a Project Review Meeting, but where it is later decided by mutual agreement not to proceed with the Gainshare opportunity, shall be shared between both parties on a 50:50 basis.

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[***] INDICATES MATERIAL THAT HAS BEEN OMITTED AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED MATERIAL HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 24b-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.

The Contractor shall, if requested by the Authority, provide a fair and reasonable quotation for the non-recurring costs incurred for any Gainshare.

Non-recurring costs of any Gainshare shall not include any allowance for profit.

A successful Gainshare proposal will be an amendment to the Contract and thus can be introduced only by the agreement of both Parties.  Where a Gainsharing proposal is not successful, i.e. where the benefit(s) prove on study to be illusory, unrealisable or insufficient, or the terms of the proposal’s implementation cannot be agreed by both Parties, then the original contract will stand.  Thus the decision on whether to proceed with any Gainshare proposal will be taken by both Parties to the Contract.

The gain, benefit or advantage to be shared need not necessarily be financial, although financial benefits are likely to feature strongly.  Any financial benefits will be shared between the Authority and Contractor and, where applicable, through the Contractor’s supply chain.  The gain may not necessarily be one of lower costs; it could be increased or improved capability or earlier delivery.

Transfers and Assignments

In accordance with DEFCON 518, the Contractor shall not assign any part of the Contract to a third party without the Authority’s prior agreement.

Parent Company Guarantee

The Contractor has provided a Parent Company Guarantee in the form set out in Annex M.  The Parent Company Guarantee shall remain in place for the duration of the Contract.

Amendments to Contract

In addition to the terms of DEFCON 503, only the Commercial Manager (or his authorised representative) detailed at Box 1 of DEFFORM 111 shall be authorised to vary the terms and conditions of the Contract, including specifications, standards of drawings etc., which form part of the Contract and/or to exercise any option to acquire Option Items in accordance with clause 0, in each case on behalf of the Authority.

Nothing said, done or written by any person, nor anything omitted to be done, said or written by any person, including, but without limitation, any servant or agent of the Authority, shall in any way affect the rights of the Authority, modify, affect, reduce or extinguish the obligations and liabilities of the Contractor under the Contract, or be deemed to be a waiver of rights of the Authority, unless as may be expressly stated in writing and signed by the Commercial Manager or his authorised representatives as detailed at Box 1 of DEFFORM 111.

Dispute Resolution

Any dispute or difference or question arising out of or in relation to this Contract between the Contractor and the Authority shall be resolved in accordance with this Clause 0 and

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[***] INDICATES MATERIAL THAT HAS BEEN OMITTED AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED MATERIAL HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 24b-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.

DEFCON 530 shall be deemed to be amended to the extent it is inconsistent with this Clause 0.

If any dispute, difference or question arises out of the performance of this Contract, then the Parties concerned shall attempt to resolve it between themselves in good faith and to the mutual satisfaction of both Parties in a timely and expeditious manner.

Any dispute, difference or question shall be referred firstly to the decision of the Authority Contracting Team’s Senior Commercial Manager and the Senior Commercial Manager (or equivalent) of the Contractor or such other persons as the Parties may respectively designate for this purpose from time to time by notice to the other.

If within 30 (thirty) days the Parties have failed to reach agreement then the dispute, difference or question shall be referred to the decision of the LPPV Steering Group.

If within 30 (thirty) days after referral of any dispute, difference or question under Sub-Clause 0 above, the Authority and the Contractor have failed to reach agreement, then subject as expressly provided in this Contract, the Parties may seek to resolve the dispute through the use of any Alternative Dispute Resolution (“ADR”) procedure on which they may agree.  If the Parties choose not to use an ADR procedure, or if the ADR procedure does not resolve the Dispute to the satisfaction of both Parties in either case within a further 30 (thirty) day period or such longer period as the parties agree, the Dispute shall be referred to Arbitration in accordance with DEFCON 530.

For the purposes of DEFCON 530, any arbitration shall take place under the rules of the London Court of International Arbitration (the LCIA Rules) in London in English.

For the avoidance of doubt it is agreed between the Parties that the arbitration process and anything said, done or produced in or in relation to the arbitration process (including any awards) shall be confidential as between the Parties, except as may be lawfully required in judicial proceedings relating to the arbitration or otherwise.  No report relating to anything said, done or produced in or in relation to the arbitration process may be made beyond the tribunal, the Parties, their legal representatives and any person necessary to the conduct of the proceedings, without the concurrence of all Parties to the arbitration.

Neither Party shall be entitled to suspend performance of the Contract merely by reason of the reference of any dispute to the procedures set out in this Clause or to arbitration.

Duration

The Contract shall commence on the date of execution.  The date for delivery of each Article and other requirements in the Schedule of Requirements is detailed in Annex I (Delivery Schedule) of the Contract.

Authority’s Representatives

The Authority may engage organisations to assist it with the Contract.  In such circumstances these parties shall be deemed to be approved representatives of the Authority with whom the Contractor shall co-operate fully and provide all reasonable assistance to them in performing the roles and responsibilities assigned to them by the Authority.

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The organisations that the Authority has currently engaged to assist with the Contract are listed at Annex N to the Contract.

Any contract placed by the Authority for the services mentioned in Clause 0 above shall include provisions for the protection of the confidentiality of any information released under the said contract substantially incorporating the requirements of Clause 0 of the Contract.

Warranty Interpretation

Notwithstanding the provisions of DEFCON 501, for the purposes of Clauses 0 and 0 below the following terms shall mean:

Parts & Labour Warranty

The Contractor shall provide the Authority with a Parts and Labour Warranty for each Article in accordance with Annex Q to the Contract.

Should the Authority undertake warranty repairs in accordance with paragraph 5 of Annex Q to the Contract, the Contractor shall reimburse the labour costs incurred by the Authority at the inclusive labour rate stated in Annex W.

Reliability Warranty

The Contractor shall provide the Authority with a Reliability Warranty for each Article in accordance with Annex R to the Contract.

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[***] INDICATES MATERIAL THAT HAS BEEN OMITTED AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED MATERIAL HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 24b-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.

Should the Authority undertake warranty repairs in accordance with paragraph 5 of Annex R to the Contract, the Contractor shall reimburse the labour costs incurred by the Authority at the inclusive labour rate stated in Annex W.

Payment against Item 10 of the Schedule of Requirements shall be payable in the event of successful completion of the Reliability Demonstration Trial detailed at Annex B or otherwise thirty (30) days following the completion of such Reliability Demonstration Trial provided that the Authority has not exercised its rights to terminate the Contract at such date.

Sustainable Procurement - Best Practice

The Contractor is encouraged to bring to the attention of the Authority any measures which might promote sustainable procurement from an environmental point of view.

Sustainable Procurement - Legislative Requirements

The Contractor shall take all reasonable steps to procure the observance of environmental legislation related to the subject matter or the execution of the Contract by any servants, employees or agents of the Contractor and any Sub-contractors engaged in the performance of the Contract.

If the Contractor becomes aware of any prosecution or proceedings, for criminal breaches of environmental legislation related to the subject matter or the execution of the Contract, against the Contractor, any servants, employees or agents of the Contractor and any Sub-contractors engaged in performance of the Contract, the Contractor shall immediately notify the Authority at the address specified in the Contract.

Any convictions during the period of the Contract for criminal breaches of environmental legislation related to the subject matter or the execution of the Contract by the Contractor or any of the Contractor’s directors/partners or senior management who have powers of representation, decision or control, shall be regarded as a material breach of this Contract.

Transparency

Notwithstanding any other term of this Contract, including DEFCON 531 where applicable, the Contractor gives its consent to the Authority to publish the content of this Contract in its entirety, including from time to time agreed changes to the Contract, to the general public.  The Contractor shall assist and cooperate with the Authority to enable the Authority to publish this Contract.  References to “this Contract” in this Clause 0 shall only apply to these Contract Terms and Conditions and the attached Annexes and shall not apply to deliverables provided by the Contractor.

Before publishing the content of this Contract to the general public in accordance with Clause 0 above, the Authority may redact any information that would be exempt from disclosure if it was the subject of a request for information under the Freedom of Information Act 2000 (“the Act”) or the Environmental Information Regulations 2004 (“the Regulations”).

The Authority may consult with the Contractor before redacting any information from the content of this Contract in accordance with Sub-Clause 0 above and shall consult with the Contractor prior to any proposed disclosure of information covered by Annex BB.  The

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[***] INDICATES MATERIAL THAT HAS BEEN OMITTED AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED MATERIAL HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 24b-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.

Contractor acknowledges and accepts that its representations on redactions and disclosure during consultation may not be determinative and that the decision whether to redact or disclose information is a matter in which the Authority shall exercise its own discretion, subject always to the provisions of the Act or the Regulations.

ITAR

The Contractor shall take all reasonable steps to ensure that it is not required to obtain any further US government approvals in order to deliver the articles provided under Items 1-8 of the Schedule of Requirements and any option items detailed at Clause 0.  Where, as a result of a change in requirement, change of sub-contractor etc, the Contractor believes that it may be necessary to obtain further US government approvals, the Contractor shall propose, for the Authority’s consideration, alternative solutions which will avoid the need for such approvals.

SPECIFICATIONS, PLANS, ETC

The following DEFCONs shall apply to this Contract, as modified below (where relevant):

DEFCON 68 (Edn.10/08) - Supply of Data for Hazardous Articles, Materials and Substances

DEFCON 82 (Edn.10/04) - Special Procedure For Initial Spares

DEFCON 117 (Edn.05/06) - Supply of Documentation for NATO Codification

DEFCON 129 (Edn.07/08) - Packaging (For Articles other than Ammunition and Explosives)

DEFCON 502 (Edn.06/08) - Specifications

DEFCON 595 (Edn.10/04) - General Purpose Automatic Test Equipment Data Requirements

DEFCON 601 (Edn.10/04) - Redundant Materiel

DEFCON 602A (Edn.12/06) - Deliverable Quality Plan

DEFCON 606 (Edn.10/97) - Change and Configuration Control Procedure

DEFCON 607 (Edn.05/08) - Radio Transmissions

DEFCON 608 (Edn.10/98) - Access and Facilities to be Provided by the Contractor

DEFCON 624 (Edn.04/10) - Use of Asbestos in Arms, Munitions or War Materials

DEFCON 637 (Edn.08/99) - Defect Investigation and Liability

DEFCON 644 (Edn.10/98) - Marking of Articles

DEFCON 645 (Edn.07/99) - Export Potential

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Performance of Work

The Contractor shall execute and complete all items on the Schedule of Requirements in accordance with this Contract.  For the entire duration of the Contract, all work under this Contract shall be carried out in accordance with the Statement of Work at Annex A to the Contract, subject to the qualification in the agreed Compliance Statement against LPPV SOW (CDRL54).

The Authority’s requirements under this Contract include any work which is necessary to satisfy the Systems Requirement Document (Annex B to the Contract), subject to the qualification set out in the LPPV SRD Compliance Matrix (CDRL51) and all works which (although not mentioned in this Contract) are necessary for the completion of the Contract.

The Contractor shall, whenever required by the Authority’s Project Manager, submit details of the arrangements and methods which the Contractor proposes to adopt for the execution of the work including whether the same differs from the Statement of Work at Annex A and/or the C-TEMP (see Annex S to Contract).  The Contractor shall not make any alteration to the Statement of Work (Annex A to the Contract) unless:

2.2.1.9          the same is as a result of a Change pursuant to Annex K Contract Change Procedure; and/or

2.2.1.10        the same is otherwise agreed in writing with the Authority’s Project Manager and confirmed by a Contract Amendment in accordance with DEFCON 503 altering the Statement of Work at Annex A.

Except as expressly provided in and without prejudice to the Authority’s obligations under Clause 0 (Loans), the Contractor shall be responsible for obtaining all information and data necessary for the carrying out of its obligations under the Contract.

Unless otherwise expressly specified in the Statement of Work (Annex A to the Contract), the Contractor shall not, unless agreed in writing by the Authority, specify or use any materials or equipment which:

2.2.1.11        do not conform with British Standards and Codes of Practice where such exist or such other equivalent national or international standards or requirements applicable at the relevant time to projects for armoured military vehicles; and/or

2.2.1.12        are generally known to the military engineering industry to be deleterious to health and safety, the performance, physical integrity or the durability of armoured military vehicles or damaging to the environment in the particular circumstances in which they are specified or used.

Scope of Work

With the exception of a Contract Amendment, even though the Authority may from time to time formally or informally verify or express satisfaction with any design, drawing or data or if the Authority at any stage gives any advice or makes any suggestion relating to any design, drawing or data, or the work under the Contract, the Authority shall not thereby incur any liability in respect of such design, drawing or data and the Contractor shall remain solely responsible for fully meeting the requirements of the Contract.

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[***] INDICATES MATERIAL THAT HAS BEEN OMITTED AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED MATERIAL HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 24b-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.

Risk & Opportunity

The Contractor acknowledges that any risk assessment which has been, or may be, undertaken in connection with this Contract has been, or will be, a project management function only.  Such risk assessment does not affect the legal relationship between the Parties.  The issuing of any risk assessment questionnaire and the process of risk assessment generally, including without limitation the identification of (or failure to identify):

2.2.1.13        particular risks and their impact; or

2.2.1.14        risk reduction measures, contingency plans and remedial actions;

shall not in any way limit or exclude the Contractor’s obligations under this Contract and shall be entirely without prejudice to the Authority’s rights, privileges and powers under this Contract.  The risks identified as a result of any risk assessment questionnaire and risk assessment process generally remain the risks of the Contractor and are not assumed by the Authority except to the extent that the Authority expressly and unequivocally accepts those risks under the Contract.  Any risk assessment questionnaire released was, or will be, issued by the Authority solely on this basis.

Risk Management Process

The Contractor shall produce an up to date joint Authority/Contractor Risk and Opportunity Register, in accordance with the Statement of Work at Annex A to the Contract.  The Risk and Opportunity Register shall be maintained by the Contractor for the duration of the Contract and shall include all risks in the supply chain including those of their Sub-contractors.

The Contractor shall maintain the joint Risk and Opportunity Register using the Active Risk Management Tool and shall make the Risk and Opportunity Register available to the Authority electronically.

Quality Assurance

All work under the Contract shall be carried out in accordance with the provisions below.

The Contractor is responsible for ensuring:

2.2.1.15        The quality of the Articles and material supplied conforms to contract requirements;

2.2.1.16        The quality planning and management activities conform to contract requirements; and

2.2.1.17        Sub-contractor controls conform to contract requirements.

Subject to Clause 0 below, the Contractor shall hold Quality Management System certification ISO 9001 (or equivalent) which accords with the scope of the contract requirements and is issued by a third party certification body accredited by the UK Accreditation Service.

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Where the Contractor is not ISO 9001 accredited, he shall ensure that the appropriate certificate is received within six months of the date of Contract and shall supply a copy of the certificate to the Authority.  Achievement of such certification shall be a condition precedent to payment of the ‘Start of Production’ milestone as set out in Annex HH.

Subject to Clause 0 above, the Contractor shall maintain ISO 9001 certification with the appropriate scope for the duration of the Contract.

The quality standards and requirements which shall apply to the Contract are listed at Appendix F to Annex A to the Contract and the Contractor’s Quality Management System shall deliver compliance with these standards and requirements.

In accordance with STANAG 4107 and AQAP 2070 procedures, overseas quality assurance surveillance (as set out therein) may be delegated to another NATO Nation.  Where the final supplier is not a NATO Nation or organisation, surveillance may be carried out under the terms of a current Memorandum of Understanding.

For the purpose of the Contract, the QA Representative shall be the Authority’s Project Manager or his authorised representative, as may from time to time be notified by the Authority.

A quality liaison meeting shall be held within four weeks of execution of the Contract to conduct a contract review and establish the terms of reference for a Quality Assurance Working Group.

In all cases where the Sub-contractor is not based in the UK, the Contractor shall cause to be included in any relevant Sub-contract the following clause:

“This Contract PMT/0009 may be subjected to Quality Assurance Surveillance at your facility on behalf of the UK Government.  You shall provide any assistance needed by the Quality Assurance Representative in the execution of his responsibilities in respect of this Contract.”

Every deliverable to the Authority shall be accompanied by a Certificate of Conformity, the approval of which by the Contractor’s authorised representative confirms conformance to contract requirements or lists significant (agreed) deviations.  Where equipment is initially delivered to an interim build standard, the Contractor shall maintain a log of build standard changes up to an including the final acceptance build standard.  Thereafter, equipment previously delivered to an interim build standard shall be upgraded at a time to be agreed but not later than 6 months from confirmation of the final build standard.

In Clause 0, reference to any related document means the edition and all amendments current at the date of execution of the Contract unless a specific issue is specified.

The standards to which work shall be completed may not necessarily be referred to in this Clause.  They will, however, be referred to in the appropriate Clause elsewhere in the Contract.

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Concessions

For the purposes of the Contract, Concessions shall be managed in accordance with Defence Standard 05-61 Part 1 (Issue 4) entitled “Quality Assurance Procedural Requirements — Concessions”.

Standards of Performance

Without prejudice to Clause 0, the Contractor shall perform its obligations under this Contract in accordance with:

2.2.1.18        Narrative Conditions of the Contract;

2.2.1.19        DEFCONs of the Contract and any documents expressly called up by these;

2.2.1.20        Annex B to the Contract (Systems Requirements Document);

2.2.1.21        Any other Annexes to Contract other than Annex A;

2.2.1.22        Annex A to the Contract (Statement of Work);

2.2.1.23        Any other documents referenced in the Contract;

2.2.1.24        All applicable Laws;

2.2.1.25        Good Industry Practice;

2.2.1.26        The requirements of the Authority’s Quality Assurance Requirements stipulated in Clause 0 (Quality Assurance); and

2.2.1.27        The requirements of the Clause 0.

The Contractor shall give all notices, pay all taxes, duties and fees, and obtain and maintain all permits, licences and approvals, as required by the Laws in relation to the design, execution and completion of the work required by the Contract.  The Contractor shall comply with all such permits, licences and approvals including the discharging of all conditions of the same.

Contractor Test, Trial or Demonstration

For any test, trial or demonstration which the Contractor intends to undertake as part of his C-TEMP (Annex S to the Contract), the Contractor shall provide the Authority not less than twenty (20) business days notice setting out the date, time and place when each test, trial or demonstration shall be carried out.  The Authority shall be entitled to invite third parties to attend to witness any such test, trial or demonstration in addition to representatives from the Authority at reasonable times and on giving reasonable prior notice to the Contractor and shall use reasonable endeavours to procure that such third parties comply with the Contractor’s reasonable safety procedures and instructions.

The Contractor shall be entitled to proceed with each test, trial, or demonstration notwithstanding that the Authority or its representatives may not be in attendance provided that the Contractor has provided the relevant notice in accordance with Clause 0.

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On completion of each test, trial or demonstration, the Contractor shall record the results by completing a report which shall include a record of whether or not the relevant Acceptance Criteria, which is applied to the test, trial, or demonstration, was met.

The Contractor shall in carrying out the test, trial or demonstration comply with the Statement of Work at Annex A to the Contract, and the C-TEMP at Annex S to the Contract.

The Contractor shall send a copy of the completed report and a draft Assurance Sign Off Certificate to the Authority within ten (10) business days of the completion of the test, trial or demonstration to which it relates.  If the Authority has not witnessed a test, trial or demonstration then the Contractor shall provide to the Authority reasonable evidence to demonstrate that the Acceptance Criteria was achieved for such test, trial, or demonstration and such evidence shall be provided by the Contractor to the Authority contemporaneously with the copy of the relevant completed test, trial or demonstration report.

If any test, trial or demonstration item does not meet the relevant Acceptance Criteria, the Contractor shall (at its own expense) complete such corrective action and other modifications as is necessary to overcome the deficiencies identified in the report and repeat the test, trial or demonstration as soon as reasonably practicable.  The provisions of Clause 0 to 0 (inclusive) shall apply to such repeat test, trials or demonstrations except that the Contractor shall only be required to provide the Authority five (5) business days notice of the date, time and place of any such repeat test, trial or demonstration.

The Authority may, within twenty (20) business days of receipt of a report, the evidence described in Clause 0 (if applicable) and a draft Assurance Sign Off Certificate, dispute the accuracy of the test, trial or demonstration report and/or the evidence described in Clause 0 (as the case may be).  If the Authority does not dispute the accuracy of a report and/or the evidence described in Clause 0 (if applicable) during the relevant period, the Authority shall countersign and issue to the Contractor the Assurance Sign-Off Certificate relevant for such demonstration item.  If the Authority fails to notify the Contractor whether or not it agrees or disputes the accuracy of the report and/or the evidence described in Clause 0 (as the case may be) within the relevant period then the Contractor shall notify the Authority that it has failed to respond.  If the Parties are unable to agree the report and/or whether the evidence described in Clause 0 (as the case may be) demonstrates that the Acceptance Criteria has been achieved in relation to such Demonstration Item, any matter in dispute may be referred to Clause 0 Dispute Resolution.

The Authority’s signature of an Assurance Sign-Off Certificate shall not constitute acceptance off Contract, and it shall not prejudice the Contractor’s responsibility to meet the requirements of the Contract including that for achievement of the Systems Requirement Document at Annex B to the Contract.

User Trials

The Contractor shall support and meet his obligations for the LPPV User Trials stated at Annex T to the Contract.  All User Trials Articles used in the LPPV User Trials shall remain the property of the Contractor and shall be loaned to the Authority, for a period of up to twelve (12) months and governed by the terms set out in Annex U of the Contract.  The Contractor shall provide all required documentation and support for the User Trials Articles throughout the LPPV User Trials.

The LPPV User Trials shall be conducted at UK location(s) to be notified by the Authority.

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[***] INDICATES MATERIAL THAT HAS BEEN OMITTED AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED MATERIAL HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 24b-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.

All the User Trials Articles shall be made available within the agreed Contract Price of this Contract and the Authority shall not be charged any additional cost for loan of equipment or support to the LPPV User Trials.

The Authority shall confirm that the LPPV User Trials shall proceed four (4) weeks prior to the trials start date.  The Contractor shall, two (2) weeks prior to that date, provide training and instruction (including any required technical publications) for up to ten (10) service and other personnel identified by the Authority as conducting the LPPV User Trials.  The training and instruction shall be sufficient to allow safe operation in accordance with the requirements of the Safety and Environmental Case as set out in Clause 0.

The LPPV User Trials shall be used to:

2.2.1.28        assist the Acceptance process in identifying any issues relating to the Article and highlight any areas of the Articles, which may not meet the requirements of the Contract.  The LPPV User Trial shall not seek independently to verify compliance with every requirement of the Contract, although the Authority reserves the right to do so, in whole or in part;

2.2.1.29        evaluate the Technical Documentation presented and provide comment;

2.2.1.30        identify additional Authority training requirements;

2.2.1.31        assist the Authority in developing its Standard Operating Procedures.

If, during the LPPV User Trials, the Article or any changes made to the Article are found not to meet the requirements of the Contract in any respect, then the Contractor shall, at his own cost, be responsible for rectifying all shortfalls and re-trials until the Contract requirements are met.

Design Authority

The Contractor shall be the LPPV Design Authority (the “LPPV DA”) for all of the Articles delivered under the Contract.  As the LPPV DA, the Contractor shall perform the obligations set out in this Clause 0.

The Contractor shall prepare and maintain all design specifications and manufacturing records in accordance with the terms and conditions of the Contract and provide the appropriate sub-system and interface data in the form of a Technical Data Pack which is described in the Contract Data Requirements at Annex C of the Contract.

The Contractor agrees to provide information to the Authority in order that the safety of the Article can be ascertained.

The Contractor agrees to support all the Articles delivered under this Contract throughout their life, under terms and conditions and prices to be agreed with the Authority.

Sub-contracting of its obligations under this Clause 0 does not relieve the Contractor of his responsibilities.  The Contractor shall make such arrangements with its Sub-contractors, and they with theirs, to ensure that the sub-contracted elements meet the requirements of the Contract.

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The Contractor shall make available to the Authority drawings, design data, calculations and reports of tests or demonstrations so that questions which may affect the safety and environmental impact or performance of the completed equipment may be discussed at an early stage.  If requested by the Authority, the Contractor shall make arrangements for such tests or demonstrations to be witnessed by the Authority or its Authorised Representatives at reasonable times and on giving reasonable prior notice to the Contractor and the Authority shall comply with and procure that its Authorised Representatives comply with any reasonable safety procedures or instructions of the Contractor.

The Authority shall have the right, at its sole discretion, to:

2.2.1.32        transfer the obligations in paragraph (0) above to another party if the Contractor is in material breach of such obligations and fails to remedy such breach within ten (10) working days of receipt of notice from the Authority; or

2.2.1.33        perform such obligations itself.

The Contractor shall maintain the ability to transfer the obligations in a timely fashion and shall provide all required assistance to facilitate the transfer.  Such transfer shall be on fair and reasonable commercial terms.

Where there is transfer of the obligations in paragraph (0), a change proposal pursuant to Clause 0 will be produced to reflect the reduced scope and any change in the risk profile.

The Parties shall comply with paragraph 7 of JSP 886, Volume 5, Part 2A: land modifications, version 1.3 dated 25 Jan 10.

Systems Acceptance/Demonstration

System Acceptance shall be the process of progressing the Articles through the following stages of acceptance:

2.2.1.34        Design Acceptance following Design Chill and Design Freeze, and

2.2.1.35        Final System Acceptance

The Contractor and the Authority shall formally agree and record the transition between each stage before proceeding to the next stage in accordance with the C-TEMP at Annex S of the Contract.

This Clause and the C-TEMP at Annex S to the Contract state the agreed procedure to be undertaken and the roles, responsibilities and obligations of the Contractor and the Authority for the Articles  to achieve System Acceptance.  The Acceptance Criteria are stated within the Systems Requirement Document at Annex B to the Contract.

The Contractor shall demonstrate to the Authority’s satisfaction that the Article fully meets all of the requirements of the Systems Requirement Document at Annex B to the Contract at the performance levels offered in the Contractor’s compliance matrix.  Demonstration shall be conducted in accordance with the Contractor’s Test Evaluation Management  Plan (C-TEMP) at Annex S to the Contract.

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[***] INDICATES MATERIAL THAT HAS BEEN OMITTED AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED MATERIAL HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 24b-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.

The Contractor shall formally report evidence resulting from the C-TEMP to the Authority at each Project Review Meeting, or at any other such time as may reasonably be requested by the Authority.

At the conclusion of all trials, tests and demonstrations leading to Design Acceptance, the Contractor shall submit to the Authority a Final Trials report and all evidence resulting from the activities carried out under the C-TEMP at Annex S to the Contract.  The Contractor shall certify that the Articles fully meet the requirements of the Contract including the Systems Requirement Document at Annex B to the Contract.

Demonstration of full compliance to the satisfaction of the Authority shall result in Design Acceptance by the Authority and agreement of the production build standard for each Article.  Notification of satisfactory demonstration shall be given in writing to the Contractor within one (1) month of the date of the certified evidence and final trials report being submitted to the Authority.

The granting of Design Acceptance and subsequently Final System Acceptance by the Authority shall in no way affect other rights the Authority has under the Contract.  The Contractor shall remain fully responsible for meeting all his obligations under the Contract, including his role in achieving System Acceptance.  If, subsequent to System Acceptance, the Articles are found not to meet the requirements of the Contract in any respect then the Contractor shall, at his own cost, be responsible for rectifying all shortfalls and re-trials until the requirement is met to the reasonable satisfaction of the Authority’s Project Manager.

The progressive acceptance process, as agreed in the C-TEMP at Annex S to the Contract, shall be a process of continual assessment for the Authority and the Contractor to jointly review the evidence as it becomes available throughout demonstration, manufacture and support.  The body of evidence progressively created and reviewed shall be used as part of the Contractor’s demonstration that the Articles are being developed, manufactured and introduced into service in accordance with the Contract.  Progressive acceptance shall not mean Design Acceptance or Final Systems Acceptance of the Article or any part of the Article.

All evidence presented shall be measured against the Contract, including the Systems Requirement Document at Annex B to the Contract (including the Contractor’s compliance matrix), and compliance with Def Stans and STANAGs where appropriate and applicable.

Nothing said, done or implied by the Authority during the progressive acceptance process shall affect the legal relationship between the parties and shall in no way limit or exclude the Contractor’s obligations under the Contract.

Configuration Control

The Contractor shall conduct Configuration Management in accordance with DEF STAN 05-57 Issue 5 dated 17 June 2005 and his Configuration Management Plan at CDRL 38 of the SOW at Annex A.  The Contractor shall ensure that the Authority’s Project Manager (or his authorised representative) has full and free access to the Contractor’s records of the configuration items and the configuration process.

A Configuration Changes Management Group (CCMG) shall be established by the Contractor to control and manage any changes to the configuration baseline of the Articles, its ancillaries, its associated logistic support and the Project Plans set out in the Statement

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of Work at Annex A to the Contract.  The CCMG shall remain in existence for the period during which the configuration baseline is under Contractor’s control.  The CCMG shall be chaired by the Contractor.  The Contractor shall give the Authority at least two (2) weeks prior notice of each meeting of the CCMG and the Authority shall have the right to attend such meetings as it deems appropriate.

Contract Change Procedure

This clause describes the procedure to be used for implementing changes to the Contract.

Changes may include, but shall not be limited to, the following:

2.2.1.36        Changes to deliverables;

2.2.1.37        Flexing of funding to facilitate the curtailment or expansion of activities being undertaken;

2.2.1.38        Introduction of new work as a result of the identification of new technologies or the work of other programmes;

2.2.1.39        Changes to the acceptance schedule and corresponding effects on milestones; and/or

2.2.1.40        Removal of work that is unnecessary to achieve Contract outcomes or for which better value for money can be achieved through a decision to allocate the cost of that work to other Contract outcomes.

Changes to Contract requirements may be proposed by the Authority or by the Contractor.  In either case the Contractor shall be responsible for preparing a Change Proposal using the Change Notice Form at Annex K to the Contract.

When the Authority notifies the Contractor of a proposed change in requirements, or when the Contractor identifies the potential for such a change, the Contractor shall prepare a Change Notice for the Authority’s consideration within 20 Business Days or such other timescale as may otherwise be agreed by the Authority.  The Change Notice shall contain sufficient information to enable a decision on the proposed change to be made within the timescale proposed within the Change Notice.

For proposed Changes to the Contract, the Change Notice shall include all costs and other factors affected by the proposed Change.  These shall include, but not be limited to any change to:

2.2.1.41        The overall Contract Price;

2.2.1.42        Programme Schedules;

2.2.1.43        Statements of Work;

2.2.1.44        Deliverables (including Articles, DIDs, Acceptance Criteria, timing);

2.2.1.45        Any other input that may result.

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Each Change Notice shall be identified by a unique serial number, and once completed shall be submitted to the Authority for its consideration.

The price shall not only include those cost changes directly relating to the Change Notice itself but also any consequential cost changes that may arise elsewhere under the Contract.  The Authority shall not be liable for any consequential costs that were not identified prior to approval of the Change Notice concerned.

Where a change has originated from the Authority, the Contractor shall include in the Change Notice their reasonable costs incurred for preparation of the change.  No preparation costs shall be allowable for Contractor originated Change Notices.

Any changes initiated by the Contractor which are necessary to ensure compliance with the requirements of the Contract shall be the liability of the Contractor.

In accordance with DEFCON 127 or DEFCON 643, the price submitted in the Change Notice shall be supported by details of the rationale used to determine the proposed costs, including a detailed breakdown (embracing all levels of the supply chain).  If required, the Contractor shall also provide the Authority with full visibility of the costs of any part of the original work to which the proposed change relates.

All labour rates used shall be those set out in Annex W.

The Authority reserves the right to only part fund any changes to the Contract.  The Authority shall consider each Change Notice on a case by case basis with the Contractor prior to the approval or rejection of any such Change Notice.

Work in connection with any proposed change shall not commence until the Authority’s Commercial Manager (see Box 1 of DEFFORM 111) or his authorised representative has approved the Change Notice and the Contract has been amended in accordance with the requirements of DEFCON 503 and Clause 0.  Any work undertaken or costs incurred in advance of the acceptance of any Change Notice will be entirely at the Contractor’s own risk.  Once a proposed change has been agreed and a Contract Amendment to incorporate it has been accepted by the Contractor, then the Contractor shall implement the change in accordance with the duly amended terms and conditions of the Contract.  All change notices shall be recorded on Annex L, whether accepted or rejected.

The Authority reserves the right to reject or not take forward any proposed change contained in a Change Notice.  In the case of rejection or non-adoption the Authority shall give the Contractor reasons for that rejection.

The Authority shall notify the Contractor of its decision on whether to take forward any proposed change within 20 Business Days of the Contractor submitting full details of the change as required by this Clause 0.

Reliability & Maintainability (R&M)

The Contractor shall demonstrate the R&M requirements stated in the R&M Programme Plan and R&M case referenced in the Statement of Work (at Annex A to the Contract) and the Systems Requirement Document at Annex B.

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The Authority shall have access to the data and results produced as a result of all demonstrations/tests under Clause 0.  The Contractor and the Authority shall jointly sentence incidents that occur during the demonstration/tests.  The Incident Sentence Committee, responsible for ratifying sentencing, shall be chaired by the Authority.  In the event of any dispute, such dispute shall be resolved in accordance with Clause 0.

If at the end of any of the demonstration/tests the required level of R&M has not been met, then the Contractor shall, at no additional cost to the Authority, undertake any analysis, remedial design work, modifications and rectification work to bring R&M up to the levels stated in the Contract and shall demonstrate that this has been achieved to the satisfaction of the Authority.  Where the Authority deems appropriate this shall be by a repeat of the demonstration/trial.

The Authority’s approval for the Contractor to commence delivery of LPPV Capability shall not be provided until after successful completion of all the demonstration/trials required in the R&M Programme Plan.  The Authority shall provide confirmation in writing of the achievement or otherwise of the R&M requirements when the results of the demonstrations/trials have been reported.

Notwithstanding the Contractor’s requirements to demonstrate that the contracted Reliability and Maintainability (R&M) requirements have been achieved, the Authority reserves the right to conduct an In Service Reliability and Maintainability Demonstration (ISR&MD), within the first two years of the first delivery of Items 1, 2 and 3 of the Schedule of Requirements, to confirm that the requirements for R&M defined in the Contract have been met.

Where an ISR&MD is required it shall be conducted in accordance with terms to be agreed between the Parties to the Contract, each acting reasonably.

Where an ISR&MD is conducted, if at the end of the ISR&MD the LPPV system fails to meet the levels of R&M, the Contractor, within the Contract Price, shall undertake any necessary analysis, remedial design work, modifications, rectification work and retesting to bring R&M up to the levels stated in the Contract and shall demonstrate that this has been achieved to the satisfaction of the Authority.  He shall also be responsible for incorporating the remedial work into, but not limited to, the Supply of LPPV Capability (Items 1, 2 and 3 of the Schedule of Requirements), the Safety Case, Spares, Technical Documentation, S&TE and training equipment already delivered and those still to be delivered, at no additional cost to the Authority.

The Authority reserves the right to cease to accept deliveries should LPPV fail to meet the R&M requirements of the Contract.  Any such suspension of the acceptance shall be made in writing by the Authority contracting team’s Senior Commercial Manager, and shall remain in force until all necessary corrective action has been taken by the Contractor to overcome the shortfall in performance required under the Contract.

Acquisition Environment and Safety Management System

The Acquisition Safety and Environment Management System (ASEMS) is the Authority’s mandated Business Process for managing all aspects of project Environmental and Safety requirements.  At the core of the ASEMS are two ‘Systems Manuals’: the Project Orientated Safety Management System (POSMS) and the Project Orientated Environmental Management System (POEMS).  Each manual contains a number of procedures designed

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to manage safety risks and environmental impacts and to apply appropriate mitigation measures.

To the extent provided by the Authority from time to time, the Contractor shall ensure compliance with the PMT Safety and Environmental Management System (PMT SEMS), POSMS and POEMS in discharging his responsibilities under the Contract.

Non-Waiver

Notwithstanding any other provision in this Contract, the Contractor’s obligations under this Contract shall not be prejudiced, waived or released by the Authority or the Authority’s Project Manager formally or informally verifying or expressing reasonable satisfaction with any design, drawing or data or if the Authority or the Authority’s Project Manager at any stage provides any advice or makes or fails to make any suggestion in relation to any design, drawing or data.

Without prejudice to Clause 0, the obligation and liabilities of the Contractor under this Contract shall not be released, diminished or in any other way affected by:

2.2.1.46        Any enquiry or inspection into any relevant matter which may be made or carried out by or on behalf of the Authority;

2.2.1.47        the Authority or its representatives reviewing and/or commenting on a reviewable document and/or witnessing the testing under Clause 0 or the failure to review and/or comment on such document and/or the failure to witness any such test, trial or demonstration;

2.2.1.48        the carrying out of the LPPV User Trials (including commenting on any non-compliances with the Contract during or after the LPPV User Trials have been carried out, or the omission of the Authority and/or the Authority’s Project Manager to comment on any non-compliances with the Contract during or after the LPPV User Trials have been carried out) or the failure to carry out the LPPV User Trials;

2.2.1.49        any certificate or statement for payment or any interim or final payment or other payment or advance against the Contract Price or issue of any certificate, statement or notice under this Contract.

2.2.1.50        any admission, approval, consent, comment, sanction, acknowledgement, confirmation, notification, rejection, acceptance or advice made or given by or on behalf of the Authority, the Authority’s Project Manager or any third party or, in any case the absence thereof; and/or

2.2.1.51        the appointment of, or failure to appoint, any person to inspect or otherwise report in respect of the work required under the Contract or the design thereof, or by any act or omission of any such person, whether or not such act or omission might give rise to any independent liability of such person to the Authority, the Authority’s Project Manager or any third party.

Safety & Environmental Case

The Contractor shall:

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2.2.1.52        ensure that in performing the Contract, the Contractor complies with all statutory duties and obligations relating to safety and the environment and shall be responsible for ensuring that no Contract requirement causes him to be in breach of any statutory duty or obligation relating to safety and the environment in force at the date of execution of the Contract, subject to any approved exemptions set out in the Statement of Work (see Annex A);

2.2.1.53        immediately draw to the Authority’s attention if it appears that any Contract specification or Clause may render the Contractor in breach of any statutory duty or obligation relating to safety and the environment; and

2.2.1.54        ensure that all safety targets detailed in the Contract have been met and all risks have been reduced to a level that is As Low As Reasonably Practicable (ALARP) prior to the operation of the system by in service personnel.

The Authority may, in accordance with the Change Process and without prejudice to any of its rights which may have arisen under Sub-Clause 0 above, require the Contractor to vary each such specification or condition in a manner acceptable to the Authority and which will not render the Contractor in breach of any statutory obligation relating to safety and/or the environment.

Nothing in the Contract or in any other document created or signed on behalf of the Authority shall constitute a written undertaking for the purposes of Section 6 (8) of the Health and Safety at Work Act 1974 relieving the Contractor of any of his duties under Section 6 of that Act.

Independent Safety Advisor

The Contractor shall provide access to records, including sub-contractor records, for contract purposes, to enable the Independent Safety Advisor appointed by the Authority to carry out safety audits and other assessment activities to meet the Authority’s safety requirements.

Long Lead Items

The Contractor has been authorised to procure Long Lead Items and provide services in connection with LPPV in accordance with the forms of ITP set out at Annex Y to the Contract.  The Contractor agrees that items procured in terms of the ITP shall form part of the Contract and shall be paid for as part of the price under the Contract.

Integrated Logistic Support

All work for Items 4 - 8 of the Schedule of Requirements (Initial Support Package) shall be carried out in accordance with the Integrated Logistic Support section of the Statement of Work at Annex A.

The support solution shall be developed as part of the Contractor’s demonstration activities.  The Integrated Logistic Support (ILS) activities conducted during the Contractor’s demonstration activities, in accordance with the Statement of Work at Annex A, shall identify the resources required for the support of LPPV.

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Due to the timescale of the programme for delivery of the Articles, the Contractor shall deliver the agreed support solution at Items 4 - 8 of the Schedule of Requirements incrementally.  The delivered support shall be commensurate with the whole delivered fleet in a way that optimises the support solution as the delivery of the Articles progresses.  This shall be reflected in the Contractor’s Integrated Support Plan (ISP) as defined in the SOW at Annex A which shall detail the specific ILS activities, business and technical issues and contract deliverables in direct response to the Authority’s ILSP.  Delivery shall take place in accordance with the Master Project Schedule within the Contractor’s ISP which shall include an appropriate lead time to ensure that the support is in place prior to receipt of Articles in order to achieve the both ready for training date and operational capability.

Spares

The Contractor shall comply with DEFCON 82 for the supply of spares at Item 7 of the Schedule of Requirements.

The Contractor shall aim to increase the proportion of COTS spares items to proprietary spares items over the period of delivery of Items 1 to 3 of the Schedule of Requirements.

In consideration of the award of the Contract, the Contractor guarantees the availability of spare parts and components of his own manufacture for the life of the Articles.  Insofar as Items of other manufacturers are incorporated in the Articles, the Contractor shall use reasonable endeavours to obtain similar guarantees, but where this is not possible, he will make every reasonable effort to seek a suitable alternative to the Authority if the original spare part or component is no longer available.

Codification

NATO Codification of items shall be undertaken in accordance with DEFCON 117 (Edn 05/06).

The Authority and the Contractor shall within ninety (90) days of the date of Contract agree a timeline for codification activities.

Obsolescence

The Contractor shall be responsible, until completion of all deliverables required in terms of Items 1 - 8 of the Schedule of Requirements, for ensuring the continued supply and maintainability of Articles under this Contract whether they are of the Contractor’s own design or those of any of his Sub-contractors and the Contractor’s obligations under 0-0 shall only apply until completion of all deliverables required in terms of Items 1 - 8 of the Schedule of Requirements.

The Contractor shall be responsible for the management of obsolescence in accordance with the Obsolescence Management Plan required as part of the Statement of Work at Annex A until completion of all deliverables required in terms of Items 1 - 8 of the Schedule of Requirements.

The Contractor shall be responsible for identifying any Article or part of an Article which it believes may become obsolete and shall notify the Authority of such pending obsolescence as soon as reasonably practicable together with its proposed course of action to alleviate such obsolescence.  The Contractor shall be responsible, at its own expense, for

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recommending and implementing its proposed course of action and in doing so it shall take full account of the principles of obsolescence management set out in the Obsolescence Management Plan at required as part of the Statement of Work at Annex A.

Should the Contractor propose an alternative component of a similar design or a modification to an Article as a solution to non availability due to obsolescence or otherwise, he shall submit a Change Proposal form to the Authority in accordance with Clause 0 (Contract Change Procedure) and obtain the Authority’s approval to proceed with the implementation of his proposed solution in accordance with Clause 0 (Configuration Control).  Such approval shall not be unreasonably withheld or delayed.  Where the proposed solution does not involve either a configuration change or a change of form, fit or function, then the Contractor shall be entitled to adopt its solution.

The Contractor shall be responsible for the consequential cost of any changes necessary under this Contract as a result of non availability due to obsolescence or otherwise and/or any approved change resulting from such approval by the Authority including, but not limited to, modification of all in-service Articles (provided as part of Items 1 and/or 2 and/or 3 of the Schedule of Requirements) to ensure a common build standard, changes to the spares list, any plans, publications, support and test equipment, packaging, training, and any other consequential costs incurred by the Authority.

If the Contractor has failed to identify obsolescence in accordance with Clause 0 and the Authority is left in possession of surplus equipment that is no longer useable by the Authority to maintain and/or support Articles or equipment supplied in terms of Items 1 - 8 of the Schedule of Requirements, the Contractor shall be required to buy back such equipment from the Authority at the cost originally paid by the Authority to the Contractor for that equipment plus an additional handling charge of 10% of the cost originally paid for said equipment.

In the event that the Authority exercises the option set out in Clause 0 to acquire Option Items, the terms of Clauses 0 to 0 shall apply in equivalent terms to such Option Items as they apply to Articles supplied in terms of Items 1, 2 and 3 of the Schedule of Requirements.

Sustainable Procurement - Environmental Management Standards

The Contractor shall take all reasonable steps to ensure that all activities under this Contract shall comply with certified environmental management standards based on ISO14001 or equivalent.

Marking of Articles

The Contractor shall supply and fit vehicle identification plates in accordance with the Systems Requirements Document at Annex B to the Contract.

The Contractor shall supply and fit Modification plates in accordance with the Systems Requirements Document at Annex B to the Contract.

The Authority will provide the Contractor with Asset Code, NSN, nomenclature, ERMS & AESP code details.

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Registration Plates and Allocation of Registration Numbers

The Contractor shall supply and fit registration plates in accordance with the Systems Requirement Document at Annex B to the Contract.  Application for registration plates shall be made, in writing, 28 days before they are required to the Project Manager (see box 2 of the Appendix to Contract).

Prior to consignment of the Articles, the Contractor shall notify the allocation of vehicle registration numbers to chassis and engine numbers as appropriate to the address outlined above.

Potential Hazard - Respirable Dust on Equipment Returned From Theatre

Some equipment being returned from theatre to UK for servicing and maintenance may be contaminated with dust potentially containing respirable crystalline silica.  Maintenance, servicing and refurbishment activities that disturb this dust carry with them the potential to expose those undertaking the task to airborne dust containing respirable crystalline silica.

The Contractor shall ensure that exposure to hazardous substances must be adequately controlled and, for substances assigned a Workplace Exposure Limit (WEL), exposure does not exceed the WEL.  Respirable crystalline silica has been assigned an 8 Hr Time Weighted Average WEL of 0.1mg/M(3).

Processes that actively generate airborne dust, such as use of compressed air lines, should be avoided.  Cleaning techniques that minimise generation of airborne dust include wet or vacuum cleaning.  If this is not reasonably practicable or does not reduce exposure sufficiently then use of enclosures and/or properly designed exhaust ventilation systems - supplemented by respiratory protective equipment - may be necessary.  The provision of respiratory protective equipment on its own as a control measure is unlikely to be acceptable.

The Health and Safety Executive (HSE) recommends that risk assessments for silica follow the “special” control approach as laid out in their guidance sheet G400, further information on dealing with respirable silica can be obtained from the HSE and from the British Occupational Hygiene Society.

The Contractor shall forward this information to any companies in his supply chain that are involved in any activity, e.g. repair, servicing, maintenance, refurbishment, disposal, etc., of the equipment(s), sub-systems, and/or components, that may disturb any dust on such items.

Contractor on Deployed Operations (CONDO)

In the event the Authority requires the Contractor to provide Field Support Representatives, the Contractor shall submit a Change Proposal to provide CONDO services in accordance with DEFCON 697 and DEF-STAN 05-129.

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Priority

The Contractor agrees that the manufacture and delivery of:

2.2.1.55        Items  1 - 8 of the Schedule of Requirements; and

2.2.1.56        any Option Items in respect of which the Authority exercises its option on or prior to 30 June 2011,

shall have priority in terms of manufacturing facilities over any of the Contractor’s other customer orders.

PRICE

The following DEFCONs shall apply to this Contract, as modified below (where relevant):

DEFCON 127 (Edn.10/04) - Price Fixing Condition for Contracts of Lesser Value

This shall only apply to Amendments to Contract and elements of Unpriced Work up to value of £[***].

DEFCON 619A (Edn.09/97) - Customs Duty Drawback

DEFCON 643 (Edn.07/04) - Price Fixing

This shall apply to Pricing of the Option Items, elements of Unpriced Work and Amendments in excess of £[***].

DEFCON 648A (Edn.07/04) - Availability of Information

This shall apply to Pricing of the Option Items, elements of Unpriced Work and Amendments to Contract in excess of £[***].

DEFCON 648 (Edn.10/02) - Availability of Information

This shall only apply to Amendments to Contract and elements of Unpriced Work between £[***] and £[***].

DEFCON 650 (Edn 10/02) - References to the Review Board of Questions Arising Under the Contract

This DEFCON shall only apply to Amendments to the Contract and elements of Unpriced Work between £[***] and £[***].

DEFCON 650A (Edn.07/04) - References to the Review Board of Questions Arising under the Contract

This shall apply to Pricing of the Option Items, elements of Unpriced Work and Amendments to Contract in excess of £[***].

DEFCON 651 (Edn 10/02) - References to the Review Board of Questions Arising In relation to Relevant Sub-contracts Including those with a Subsidiary Company or Firm

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This shall only apply to Amendments to the Contract and elements of Unpriced Work between £[***] and £[***].

DEFCON 651A (Edn.07/04) - Reference To The Review Board of Questions arising in Relation to Relevant Sub-contracts Including those with a Subsidiary Company or Firm

This shall apply to Pricing of the Option Items, elements of Unpriced Work and Amendments to Contract in excess of £[***].

DEFCON 652 (Edn.07/04) - Remedy Limitation

This shall apply to Pricing of the Option Items, elements of Unpriced Work and Amendments in excess of £[***].

Prices

The prices payable under this Contract shall be as shown in the Schedule of Requirements or in accordance with the provisions specified therein and are FIRM subject to paragraph 0.

The Parties agree that any Option Items, Unpriced Work and/or Amendments to the Contract shall be priced in accordance with the DEFCONS referred to and other provisions of this Clause 4.

The prices shall be the prices of the Articles packaged in accordance with the terms and conditions of the Contract and delivered as detailed in the Contract.  Prices shall be net, after allowing for all cash and trade discounts.

The prices are inclusive of all appropriate taxes (but not UK VAT - see DEFCON 513), royalties, licence fees and the cost of complying with all conditions of the Contract.

The prices set out in the Schedule of Requirements do not include the work and deliverable set out in Annex X (“Unpriced Work”).  The Parties shall agree firm prices for such Unpriced Work within 60 days of the date of the Contract.  If the Parties cannot agree firm prices for Unpriced Work within said period, such prices shall be determined in accordance with Clause 0.

Equality of Information

This Clause is applicable to all pricing under the Contract in accordance with DEFCON 643.  The Equality of Information (E of I) Pricing Statement agreed between the Parties is set out in Annex Z to the Contract.

The Authority and the Contractor acknowledge that each of them independently has relied upon the statements in the Equality of Information Pricing Statements at Annex Z to the Contract.

Pricing of Changes to the Requirement

Where a change in requirement as detailed in the contract change procedure at Clause 0 necessitates an adjustment to an agreed price under the Contract, the Contractor shall

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submit to the Authority within 10 business days (or such other period of time as agreed with the Authority) of the request the following information in support of the price quoted:

2.2.1.57        A firm price quotation for the work required to be carried out under the proposed amendment.  The quotation should provide to the Authority full visibility of the build up of the price.  This information, which shall contain sufficient detail as to allow the Authority accurately to assess the extent to which the price quoted for the revised requirement is fair and reasonable, shall be broken down as required by Clause 0 and Annex AA to the Contract.

All price changes shall be subject to DEFCONs 643, 648, 648A, 650, 650A, 651, 651A, 652 and 127 as appropriate.

The Contractor agrees to the information in Clause 0 being used to provide equality of information to the Authority in pricing any changes to the Contract.

Timely pricing of a proposed amendment is essential to the efficient execution of the Contract.  The Contractor shall make all reasonable endeavours to supply information and negotiate a fair and reasonable price, and shall adopt a system of parallel working with the Authority (and his representatives) when preparing his quotation.

Unless otherwise agreed at Clause 0, no work under the proposed amendment shall commence until a price has been agreed.

Where, under exceptional circumstances, it is necessary for work to commence prior to an agreed price, the Authority may agree a maximum price.  The Authority may, at its own discretion, use an independent contractor to aid with the assessment of pricing.

Import Duty

With respect to Clause 4 of DEFCON 528, Articles imported from outside the EU are deemed to be military equipment under the terms of the EC Regulations and as such will be exempt from duty.  A certificate to this effect will be provided to the Contractor within one month of a request from the Contractor for an Import Duty Waiver.  In order to issue a waiver, the Contractor shall provide to the Authority’s Commercial Manager the following details: country of origin; description of Article(s); the price of the Article(s); form of delivery and port of delivery of the Article, as a minimum.

Options for Manufacture and Support

In consideration of the award of the Contract for Items 1 - 10 of the Schedule of Requirements, the Contractor grants to the Authority the irrevocable option to take up any or all of Option Items at Annex H to the Contract in accordance with the terms and conditions of this Contract.

Should the Authority wish to invoke an option to proceed with any /or all of Items at Annex H to the Contract, the PMT Senior Commercial Manager will inform the Contractor in writing by the dates stated in that Annex H or within such further period as corresponds to the aggregate of any period(s):

2.2.1.58        of delay in the programme constituting any breach of the Contract, or

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2.2.1.59        for the duration of which the Authority is prevented from exercising any such option by reason of any other breach of the Contract by the Contractor or,

2.2.1.60        for the duration of which the Authority is prevented from exercising any such option due to the Contractor not meeting the requirements of the Contract in accordance with Annex I (Delivery Schedule).

The Authority reserves the right to authorise procurement of Option Items which have a long lead time in stages depending on the lead timescales for the Option Items.

The Authority shall not be liable for any of the costs of any of Option Items prior to an option for that Item being exercised by the Authority as per Clause 0 (Amendments to Contract).  The Authority shall not be liable for any costs incurred consequent upon the option for any or all of Items at Annex H to the Contract not being exercised.

Open Book Accounting

The Contractor shall at all times maintain full, current and accurate financial and accounting records relating to the performance of its obligations under this Contract so that the Authority is able to determine all cost components, cost levels and profit margins relating to the performance of such obligations under this Contract.  Such records shall include, without limitation:

2.2.1.61        Direct labour and indirect labour costs;

2.2.1.62        direct material and sub-contract costs, including the full cost of purchasing or sourcing Articles;

2.2.1.63        overhead costs analysed to identify appropriate categories;

2.2.1.64        payment details to suppliers and Sub-contractors;

2.2.1.65        capital expenditure;

2.2.1.66        such other items as the Authority may reasonable require;

The Contractor shall provide a summary of records maintained in accordance with Clause 0 and other data requested by the Authority whenever requested by the Authority to do so, together with explanations, as required by the Authority, to enable the Authority to monitor the Contractor’s financial and accounting position in relation to this Contract.

Subject to five (5) business days notice, provide any facilities that the Authority may reasonably require for the Authority or its nominated representatives (which may include the National Audit Office) to visit the Contractor’s offices and the offices of its Sub-contractors (or any place where such records are held) to examine such records maintained under this Clause.

The Contractor shall provide the Authority with audited financial statements (which shall contain a full set of accounts including, but not limited to, a profit and loss account, balance sheet and cash flow statement audited by a firm of independent accountants, Auditor’s and Directors reports and accompanying explanatory notes, including changes to accounting policies) for the Contractor and its ultimate Holding Company, as soon as reasonably practicable after each becomes available.

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[***] INDICATES MATERIAL THAT HAS BEEN OMITTED AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED MATERIAL HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 24b-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.

All financial statements provided pursuant to Clause 0 shall be prepared on a basis consistently applied in accordance with generally accepted accounting principles in England, or accounting principles consistent with UK reporting accounting standards or relevant international accounting standards.  They shall give a true and fair view of the results of the Contractor’s operations for the period in question and of the state of the Contractor’s affairs as at the date at which the financial statements are made.

Without prejudice to the Contractor’s obligations under DEFCON 659 (Security Measures), the Contractor shall retain the records referred to in Clause 0 for the period of at least 6 years from the date of the relevant document.  At the expiry of such 6 years the Contractor shall offer the Authority the opportunity to take possession of all such records.

Private Venture Costs

The Parties agree to exclude from any prices calculated in accordance with Clause 0 above in respect of Option Items, Unpriced Work and Amendments any design and/or development costs except for design and development costs which have been disclosed to the Authority in writing in a notice titled “Disclosed Private Venture Costs” prior to the date of the Contract.

If in the course of agreeing prices for Option Items and/or Amendments to the Contract and/or Unpriced Work in accordance with Clause 0, the Authority discovers that any previously agreed firm price contains any design and/or development cost other than those which have been disclosed to the Authority in writing prior to the date of the Contract, the Authority shall be entitled to recover such previously undisclosed design and/or development cost whether by way of refund or set-off.

INTELLECTUAL PROPERTY RIGHTS

The following DEFCONs shall apply to this Contract, as modified below (where relevant):

DEFCON 14 (Edn.11/05) - Inventions and Designs, Crown Rights and Ownership of Patents and Registered Designs

DEFCON 90 (Edn.11/06) — Copyright

DEFCON 91 (Edn. 11/06) — Intellectual Property Rights in Software

DEFCON 531 (Edn.05/05) - Disclosure of Information

DEFCON 632 (Edn.02/07) - Third Party Intellectual Property Rights — Commercial and Non-Commercial Articles and Services

Intellectual Property Rights

The parties shall comply with the provisions of Annex BB to Contract.  Any requirements for in-service support shall be as set out in Annex BB.

37

[***] INDICATES MATERIAL THAT HAS BEEN OMITTED AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED MATERIAL HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 24b-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.

Confidentiality

This Clause shall apply in addition to and notwithstanding DEFCON 531 or any other confidentiality condition of the Contract.

For the purposes of this Clause “Controlled Information” shall mean any information in any written or tangible form which is disclosed to the Contractor by or on behalf of the Authority under or in connection with the Contract, and which is identified by the legend “Controlled Information” or other approved legend notified to the Contractor.  Controlled Information shall exclude information provided by oral communication.

The Contractor shall:

2.2.1.67        hold the Controlled Information and not use it other than for the purpose of discharging its obligations under the Contract;

2.2.1.68        not copy the Controlled Information except as strictly necessary for the purpose of discharging its obligations under the Contract;

2.2.1.69        not disclose the Controlled Information to any third party unless so authorised in writing beforehand by the Authority;

2.2.1.70        protect the Controlled Information diligently against unauthorised access and against loss; and,

2.2.1.71        act diligently to ensure that:

2.2.1.71.1        Controlled Information is disclosed to its employees only to the extent necessary for the purpose of discharging its obligations under the Contract;

2.2.1.71.2        employees to whom Controlled Information is disclosed are made aware of and required to comply with the terms of this Clause.

Where Controlled Information is provided to the Contractor, it shall:

2.2.1.72        compile a register of that Controlled Information, which shall include explicit description of the Controlled Information, a record of the number of copies made and a record of all access to the Controlled Information including access to any copies of the Controlled Information.

2.2.1.73        maintain this register for the duration of the Contract and for two years following completion of the Contract.