Orders for rental equipment ("Equipment"), services ("Services"), and the supply or sale of products or equipment ("Products") to be provided by 8SIGMA ENERGY SERVICES INC., or its operating divisions, or its direct or indirect wholly-owned subsidiaries (in each case as applicable referred to herein as "8SIGMA") to its customers (each a "Customer") are subject to acceptance by 8SIGMA, and any orders so accepted will, unless otherwise agreed in writing by 8SIGMA, be governed by the terms and conditions stated herein and any additional terms and conditions proposed by an authorized representative of 8SIGMA (these terms and conditions and any such additional terms and conditions collectively referred to herein as the "Agreement'). Any additions to or modifications of this Agreement, or any terms and conditions contained in any order or other documentation from Customer inconsistent herewith, shall not in any case bind 8SIGMA unless expressly accepted in writing by an authorized representative of 8SIGMA.
1. PAYMENT TERMS Unless alternate payment terms are specified or approved by the 8SIGMA Credit Department, all charges, including applicable packing and transportation costs, billed by 8SIGMA are payable within thirty (30) days of the date of invoice. At 8SIGMA 's option, interest will be paid by Customer on any amounts outstanding after thirty (30) days at the rate of eighteen percent (18%) per annum. Operating, production or well conditions, or any other conditions beyond the reasonable control of 8SIGMA, which prevent satisfactory operation of Equipment, Services or Products do not relieve Customer of its responsibility for payment of all sums owing to 8SIGMA, including interest thereon.
2. CANCELLATION Products: Orders for Products which are subject to cancellation by Customer after acceptance by 8SIGMA will be subject to a restocking charge of a minimum of twenty-five percent (25%) of the total price for such order, plus any actual packing and transportation costs. Orders for Products specially built or manufactured to Customer specifications, or orders for substantial quantities manufactured specially for Customer, may only be cancelled by Customer subject to either (i) payment of a cancellation fee by Customer, or (ii) a return credit against future purchases, to be determined by 8SIGMA in its sole discretion. Credit for unused Products will be issued for the quantity returned at the original purchase price, less restocking or cancellation charges, provided the returned Products are in reusable condition. No credit will be given for shipping charges incurred by Customer. In no event will credit be allowed for Products returned without prior written authorization by 8SIGMA. Equipment/Services: In the event Customer cancels an order for Services or Equipment, Customer shall be liable for all costs incurred by 8SIGMA in the mobilization/demobilization related thereto, and any other reasonable costs incurred by 8SIGMA incident to such cancellation. In addition, a restocking charge of at least twenty-five percent (25%) of the original order may be applied at 8SIGMA 's sole discretion.
3. THIRD-PARTY CHARGES, TAXES Customer shall pay all third-party charges, in compliance with 8SIGMA 's current price list, and any sales, use, rental or other taxes that may be applicable to transactions hereunder, including but limited to all applicable GST, HST and PST. Customer shall pay all applicable customs, excise, import and other duties unless otherwise agreed to in writing by an authorized representative of 8SIGMA. Customer shall provide all necessary import licenses and extensions thereof.
4. RISK OF LOSS AND TITLE For Product sales within Canada, title and risk of loss shall pass to Customer as soon as the Products depart 8SIGMA 's point of origin. For Product sales outside Canada, unless otherwise agreed to in writing between 8SIGMA and Customer, INCOTERM "CPT" shall apply with the following exception: TITLE AND RISK OF LOSS REMAIN WITH 8SIGMA UNTIL THE PRODUCTS REACH THE PORT OF ENTRY.
5. LIABILITIES, RELEASES AND INDEMNIFICATION A. In this Agreement, "Claims" shall mean all claims, demands, causes of action, liabilities, damages, judgments, fines, penalties, awards, losses, costs, expenses (including, without limitation, lawyers' fees and costs of litigation) of any kind or character arising out of, or related to, the performance of or subject matter of this Agreement (including, without limitation, real or personal property loss, damage or destruction, personal or bodily injury, illness, sickness, disease or death, loss of services or wages, or loss of consortium or society). B. 8SIGMA shall release, indemnify, defend and hold Customer, its parent, subsidiary and affiliated or related companies, and the officers, directors, employees, consultants and agents of all of the foregoing (referred to in this Agreement as "Customer Indemnitees") harmless from and against any and all Claims asserted by or in favour of any member of 8SIGMA Indemnitees (as defined in paragraph C. below) or 8SIGMA Indemnitees' subcontractors, at any tier, or their employees, agents, or invitees. C. Customer shall release, indemnify, defend and hold 8SIGMA, its parent, subsidiary and affiliated or related companies, and the officers, directors, employees, consultants and agents of all of the foregoing (referred to in this Agreement as "8SIGMA Indemnitees") harmless from and against any and all Claims asserted by or in favour of any member of Customer Indemnitees or Customer Indemnitees' contractors at any tier (except 8SIGMA Indemnitees or 8SIGMA Indemnitees' subcontractors) or their employees, agents or invitees. D. Notwithstanding paragraph B. above, should any of 8SIGMA Indemnitees' or 8SIGMA Indemnitees' subcontractors’ instruments, equipment or tools ("Tools") become lost or damaged in a well or onsite when performing or attempting to perform the Services hereunder, it is agreed and understood that Customer shall make every effort to recover any and all lost or damaged Tools. Customer shall assume the entire responsibility for such recovery or fishing operations in the recovery or attempted recovery of any such lost or damaged Tools. None of 8SIGMA 's employees are authorized to do anything whatsoever, nor shall any of 8SIGMA 's employees be required by Customer to do anything, other than consult in an advisory capacity with Customer in connection with such recovery or fishing operations. Should Customer fail to recover such Tools lost in the well or otherwise onsite, or should such Tools become damaged in the well or onsite, or damaged during recovery, Customer shall reimburse 8SIGMA the full and actual replacement value of such lost Tools or, where commercially reasonable to carry out repairs thereto, for the cost of repairing any Tools so damaged. All risks associated with loss of or damage to property of 8SIGMA Indemnitees or 8SIGMA Indemnitees’ subcontractors while in the custody and control of Customer or during transportation arranged by or controlled by Customer, shall be borne by Customer.
E. Notwithstanding anything contained in this Agreement to the contrary, Customer, to the maximum extent permitted under applicable law, shall release, indemnify, defend and hold 8SIGMA Indemnitees and 8SIGMA Indemnitees' subcontractors harmless from and against any and all Claims asserted by or in favour of any person or party, including 8SIGMA Indemnitees, Customer Indemnitees or any other person or party, resulting from: (i) loss of or damage to any well or hole (including but not limited to the costs of re-drill), (ii) blowout, fire, explosion, cratering or any uncontrolled well condition (including but not limited to the costs to control a wild well and the removal of debris), (iii) damage to any reservoir, geological formation or underground strata or the loss of oil, water or gas therefrom, (iv) the use of 8SIGMA Indemnitees' or 8SIGMA Indemnitees ’subcontractors' radioactive tools or any contamination resulting therefrom (including but not limited to retrieval or containment and clean-up), (v) pollution or contamination of any kind (other than surface spillage of fuels, lubricants, rig sewage or garbage, to the extent attributable to the negligence of 8SIGMA Indemnitees) including but not limited to the cost of control, removal and clean-up, or (vi) damage to, or escape of any substance from, any pipeline, vessel or storage facility F. Except as expressly stated herein, neither party shall be liable to the other for any indirect, special, punitive, exemplary or consequential damages or losses (whether foreseeable or not at the date of this Agreement), including without limitation damages for lost production, lost revenue, lost product, lost profit, lost business or lost business opportunities. G. Each party covenants and agrees to support the mutual indemnity and release obligations contained in paragraphs B. and C. above by carrying equal amounts of insurance (or qualified self-insurance) in an amount not less than $2,000,000.00 in lawful currency of Canada.
H. THE EXCLUSIONS OF LIABILITY, RELEASES AND INDEMNITIES SET FORTH IN PARAGRAPHS B. THROUGH F. OF THIS ARTICLE 5. SHALL APPLY TO ANY AND ALL CLAIM(S), LOSSES OR DAMAGES WITHOUT REGARD TO THE CAUSE(S) THEREOF INCLUDING BUT NOT LIMITED TO PRE-EXISTING CONDITIONS, WHETHER SUCH CONDITIONS BE PATENT OR LATENT, THE UNSEAWORTHINESS OF ANY VESSEL OR VESSELS, IMPERFECTION OF MATERIAL, DEFECT OR FAILURE OF PRODUCTS OR EQUIPMENT, BREACH OF REPRESENTATION, CONDITION OR WARRANTY (EXPRESS OR IMPLIED), HAZARDOUS ACTIVITY, STRICT LIABILITY, TORT, BREACH OF CONTRACT, BREACH OF DUTY (IMPLIED, EXPRESS, STATUTORY OR OTHERWISE), BREACH OF ANY SAFETY REQUIREMENT OR REGULATION, OR THE NEGLIGENCE OR OTHER LEGAL FAULT OR RESPONSIBILITY OF ANY PERSON (INCLUDING THE INDEMNIFIED OR RELEASED PARTY), WHETHER SUCH NEGLIGENCE BE SOLE, JOINT OR CONCURRENT, ACTIVE OR PASSIVE. I. REDRESS UNDER THE INDEMNITY PROVISIONS SET FORTH IN THIS ARTICLE 5. SHALL BE THE EXCLUSIVE REMEDY OR REMEDIES AVAILABLE TO THE PARTIES HERETO FOR THE MATTERS, CLAIMS, DAMAGES AND LOSSES COVERED BY SUCH PROVISIONS
6. CUSTOMER WARRANTY/BINDING AUTHORITY If Customer is not the sole owner of the well or the field, or the mines and minerals interests therein, Customer's request for Services, Equipment or Products shall constitute Customer's warranty that Customer is the duly constituted agent of each and every owner and has full authority to represent the interests of the same with respect to all decisions taken throughout the provision of any Services, Equipment or Products hereunder. Customer will defend, release, indemnify and hold 8SIGMA Indemnitees harmless from and against all Claims resulting from the allegation by any person that Customer has misrepresented or lacked sufficient authority to represent such person as warranted by Customer in this Article.
7. ACCESS TO WELL AND STORAGE With respect to onshore and offshore operations, Customer shall provide at its sole expense adequate means of transportation required for Equipment, Products and 8SIGMA personnel to gain access to or return from a well site, adequate safety and protective equipment for all such 8SIGMA personnel, and shall obtain at Customer’s sole cost and expense all permits, licenses or other authorization required for 8SIGMA to enter upon work areas for the purposes contemplated herein. When necessary to repair roads or bridges, or to provide transportation to move Equipment, Products or 8SIGMA personnel, such shall be arranged and paid for by Customer. Customer shall provide safe transportation and proper storage space at the well site, meeting all applicable safety and security requirements and consistent with good industry practices, for the Equipment and Products, including without limitation, all explosive and radioactive materials.
8. WARRANTY A. Services: 8SIGMA warrants that the Services to be provided by 8SIGMA pursuant to this Agreement shall conform to the material aspects of the specifications set forth in the relevant scope of work document agreed to in writing by 8SIGMA and Customer. In the event that the Services fail to conform with such specifications, 8SIGMA shall re-perform such non-conforming part of the Services, provided 8SIGMA is notified thereof by Customer prior to 8SIGMA's departure from the work site, failing which notification, 8SIGMA shall have no obligation with respect to such re-performance. B. Equipment: 8SIGMA warrants that the Equipment will be of the types specified by Customer and will be in reasonable operating condition. Liability for loss or damage to Equipment shall be as set forth in Article 5. C. Products: 8SIGMA warrants that the Products to be provided by 8SIGMA pursuant to this Agreement shall conform to any specifications agreed to in writing by 8SIGMA and Customer or, if not D. Specialty Products: In the event 8SIGMA is to provide Products to Customer based upon Customer's specific request that 8SIGMA develop, manufacture, test or put to use Products that are intended to satisfy a unique need identified by Customer and are not "standard" Products of 8SIGMA ("Specialty Products"), Customer hereby acknowledges and agrees that all such Specialty Products being provided do not necessarily have or contain the same or similar characteristics as 8SIGMA's "standard" Products, including, but not limited to, a historical performance against which future performance can be measured. In developing, manufacturing, testing and putting to use any Specialty Products, 8SIGMA will be relying upon information and specifications provided by Customer relating to the unique needs to Customer. As such, 8SIGMA shall have no liability or responsibility for the design, manufacture or engineering of any such Specialty Products, even though 8SIGMA may have participated in the development and manufacture of such Specialty Products, or for any Customer-furnished materials, information and specifications.
If any of the Specialty Products fail to meet the specifications provided by Customer upon inspection by 8SIGMA, 8SIGMA may, at its option, repair or replace the non-conforming Specialty Products with (i) the type originally furnished to Customer, or (ii) substitute Products having 8SIGMA's “standard” specifications and qualifications. 8SIGMA's warranty obligations hereunder shall not apply if, or to the extent, that the non-conformity was caused by (i) Customer's failure to properly store or maintain the Products or Equipment, (ii) abnormal well or site conditions, abrasive materials, corrosion due to aggressive fluids or incorrect specifications provided by Customer, (iii) unauthorized alteration or repair of the Products or Equipment by Customer (iv) the Products or Equipment are lost or damaged while on Customer's site due to Customer's or any third party's negligence, vandalism or force majeure (including, but not limited to electrical storm or lightning), or (v) use or handling of the Products or Equipment by Customer in a manner inconsistent with 8SIGMA's recommendations. Further, 8SIGMA's warranty obligations under this Article 8 shall terminate if (i) Customer fails to perform its obligations under this or any other Agreement between the parties, or (ii) Customer fails to pay any charges due 8SIGMA as provided herein. All non-conforming Products shall be delivered to the service facility designated by 8SIGMA. All transportation charges related to the repair or replacement of non-conforming Products shall be borne by Customer. Any parts for which 8SIGMA provides replacement under this Agreement shall become the property of 8SIGMA. With regard to materials or equipment furnished by third party vendors and/or suppliers, 8SIGMA's liability therefor shall be limited to the assignment of such third party vendor's or supplier's warranty to Customer, to the extent such warranties are assignable. Interpretations, research, analysis, recommendations, advice or interpretational data ("Interpretations and/or Recommendations") furnished by 8SIGMA hereunder are opinions based upon inferences from measurements, empirical relationships and assumptions, and industry practice, which inferences, assumptions and practices are not infallible, and with respect to which professional geologists, engineers, drilling consultants, and analysts may differ. Accordingly, 8SIGMA does not give any condition or warranty as to the accuracy, correctness, or completeness of any such Interpretations and/or Recommendations, or that Customer's reliance or any third party's reliance on such Interpretations and/or Recommendations will accomplish any particular results. Customer assumes full responsibility for the use of such Interpretations and/or Recommendations and for all decisions based thereon (including without limitation decisions based on any oil and gas evaluations, production forecasts and reserve estimates, furnished by 8SIGMA to Customer hereunder), and Customer hereby agrees to and shall release, defend and indemnify 8SIGMA from any Claims arising out of the use of such Interpretations and/or Recommendations. 8SIGMA will endeavour to transmit data to Customer as accurately and securely as practicable in accordance with current industry practice. Notwithstanding the foregoing, 8SIGMA does not warrant or give any condition as to the accuracy of data transmitted by electronic processes and 8SIGMA will not be responsible in any case to Customer for accidental or intentional interception of such data by others, howsoever caused.
THIS ARTICLE 8 SETS FORTH CUSTOMER'S SOLE REMEDY AND 8SIGMA'S ONLY OBLIGATION WITH REGARD TO NON-CONFORMING SERVICES, EQUIPMENT OR PRODUCTS. EXCEPT AS IS OTHERWISE EXPRESSLY PROVIDED PURSUANT TO THE PROVISIONS OF THIS ARTICLE 8, 8SIGMA MAKES NO CONDITION, WARRANTY OR GUARANTEE OF ANY KIND, EXPRESS OR IMPLIED, INCLUDING NO IMPLIED CONDITION OR WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE, OR COMPLIANCE WITH ANY DESCRIPTION, REGARDING ANY SERVICES PERFORMED OR EQUIPMENT OR PRODUCTS SUPPLIED BY 8SIGMA HEREUNDER.
9. LOST-IN-HOLE COVERAGE In some locations, lost-in-hole coverage may be available on request for some Equipment. Such coverage must be purchased by Customer prior to the Equipment leaving 8SIGMA's point of origin for such coverage to take effect. 8SIGMA reserves the right not to offer such coverage at its sole discretion.
10. INSURANCE Upon written request, each party shall furnish to the other party certificates of insurance evidencing the fact that adequate insurance to support each party's obligations hereunder has been secured. To the extent of each party's release and indemnity obligations hereunder, each party agrees that all such insurance policies shall (i) be primary to the other party's insurance, (ii) include the other party, its parent, subsidiary and affiliated or related companies, and its and their respective officers, directors, employees, consultants and agents as additional insured, and (iii) be endorsed to waive subrogation against the other party, its parent, subsidiary and affiliated or related companies, and its and their respective officers, directors, employees, consultants and agents.
11. CHANGE OF DESIGN 8SIGMA expressly reserves the right to change or modify the design and construction of any or all of its Products at any time without obligation to furnish or install such changes or modifications on Products previously or subsequently sold.
12. PATENTS 8SIGMA warrants that the use or sale of Equipment or Products as permitted hereunder will not infringe patents of third parties enforceable in Canada by reason of the use or sale of such Equipment or Products, and hereby agrees to hold Customer harmless against judgment for damages for infringement of any such patent, provided that Customer shall promptly notify 8SIGMA in writing upon receipt of any claim for infringement, or upon the filing of any such suit for infringement, whichever first occurs, and shall afford 8SIGMA full opportunity, at 8SIGMA's option and expense, to answer such claim or threat of suit, assume the control of the defence of such suit, and settle or compromise same in any way 8SIGMA sees fit. 8SIGMA does not give any condition or warranty that such Equipment or Products: (a) will not infringe any such patent when not of 8SIGMA's manufacture, or when specially made, in whole or in part, to the Customer's design specifications; or (b) if used or sold in combination with other materials or apparatus or used in the practice of processes, will not, as a result of such combination or use, infringe any such patent, and 8SIGMA shall not be liable and does not indemnify Customer for damages or losses of any nature whatsoever resulting from actual or alleged patent infringement arising pursuant to (a) and (b) above. THE FOREGOING PROVISIONS OF THIS PARAGRAPH STATE THE ENTIRE RESPONSIBILITY OF 8SIGMA CONCERNING PATENT INFRINGEMENT OR INFRINGEMENT OR VIOLATION OF ANY INTELLECTUAL PROPERTY RIGHTS. Any improvement smade to 8Sigma's technologies are agreed to be owned b 8SIGMA.
13. CONFIDENTIALITY Each party shall maintain all data and information obtained from the other party in strict confidence, subject only to disclosure required by law or legal process. In the event that 8SIGMA owns copyrights to, patents to, or has filed patent applications on, any technology related to the Services, Products or Equipment furnished by 8SIGMA hereunder, and if 8SIGMA makes any improvements on or to such technology, then any and all such improvements shall not fall within the confidentiality obligations included herein, and 8SIGMA shall own all right, title and interest, including all proprietary rights and intellectual property rights, in and to all such improvements, including drawings, specifications, calculations and other documents. The design, construction, application and operation of 8SIGMA's Services, Equipment and Products constitute and embody proprietary and confidential information. Customer shall maintain all such information in strict confidence and shall not disclose it to others, subject only to disclosure required by law or legal process (provided that, where possible to do so, Customer shall provide 8SIGMA with notice of any such legal requirement or process so that 8SIGMA may seek protective orders or oppose such disclosure), and Customer shall not use any such information except as expressly permitted herein.
14. LIENS, ATTACHMENTS AND ENCUMBRANCES Should Customer commit a material breach of any of the terms and conditions of this Agreement, become bankrupt, insolvent, go into receivership or seek the protection of any statute regarding bankruptcy, reorganization or protection from creditors, or should any creditor or other person attach or levy Customer's property or equipment, 8SIGMA shall immediately have the right, without notice and without liability for trespass or damages, to retake and remove any or all of its Products or Equipment wherever such may be found. Customer shall release, defend, indemnify and hold 8SIGMA Indemnitees harmless from any and all liens, Claims and encumbrances against Products or Equipment furnished hereunder and shall return same promptly to 8SIGMA free of any liens or encumbrances.
15. FORCE MAJEURE If either party is unable by reason of Force Majeure to carry out any of its obligations under this Agreement, other than obligations to pay money, then on such party giving notice and particulars in writing to the other party within a reasonable time after the occurrence of the cause relied upon, such obligations shall be suspended. "Force Majeure" shall include acts of God, laws and regulations, government action, war, civil disturbances, strikes and labour strife, disputes or problems, delays of vendors or carriers, lightening, fire, flood, washout, storm, breakage or accident to equipment or machinery, shortage of raw materials, and any other causes that are not reasonably within the control of the party so affected.
16. INDEPENDENT CONTRACTOR It is expressly understood that each party is an independent contractor, and that neither 8SIGMA, nor Customer, nor its principals, partners, employees or subcontractors are servants, agents or employees of Customer.
17. LIENS, ATTACHMENTS AND ENCUMBRANCES Should Customer commit a material breach of any of the terms and conditions of this Agreement, become bankrupt, insolvent, go into receivership or seek the protection of any statute regarding bankruptcy, reorganization or protection from creditors, or should any creditor or other person attach or levy Customer's property or equipment, 8SIGMA shall immediately have the right, without notice and without liability for trespass or damages, to retake and remove any or all of its Products or Equipment wherever such may be found. Customer shall release, defend, indemnify and hold 8SIGMA Indemnitees harmless from any and all liens, Claims and encumbrances against Products or Equipment furnished hereunder and shall return same promptly to 8SIGMA free of any liens or encumbrances.
18. LAWS, RULES AND REGULATIONS 8SIGMA and Customer agree to be subject to all laws, rules, regulations and decrees of any governmental or regulatory body having jurisdiction over the Services, Equipment or Products to be provided by 8SIGMA or the work site or that may otherwise be applicable to 8SIGMA's or Customer's performance under this Agreement.
19. GOVERNING LAW This Agreement shall be governed by and construed pursuant to the provisions of the laws of the province of Alberta, Canada, and the federal laws of Canada applicable therein. Subject to Article 19 following, any disputes arising under this Agreement shall be heard before the courts of the Alberta, sitting at Calgary. The parties attorn to the non-exclusive jurisdiction of the courts of Alberta, without regard to the conflicts of laws provisions of the said courts.
20. MEDIATION/ARBITRATION A. The parties will attempt to resolve any dispute between them which arises under from this Agreement in a spirit of cooperation. Accordingly, the parties agree to engage in good faith negotiations to reach a rapid and equitable solution. If the parties are unable to resolve a dispute through direct negotiation, they will use the services of a mutually agreeable mediator sitting in Calgary. Each party will bear its own expenses and an equal share of the costs of the mediators and the body administering the mediation. If the negotiation or mediation fails to reach an equitable solution to the dispute within 45 days after the request by either party to submit the dispute to negotiation or mediation, then the dispute shall be referred to and finally resolved by the Courts of Alberta, sitting at Calgary. Notwithstanding the provisions of this paragraph, the parties accept that they may take proceedings for injunctive or similar relief in any court of competent jurisdiction to restrain or prevent any breach of this Agreement.
21. ASSIGNMENT 8SIGMA shall have the right to assign this Agreement to any of its subsidiaries, affiliated or related companies without the consent of Customer. Customer may not assign this Agreement without the written consent of 8SIGMA, not to be unreasonably withheld.
22. GENERAL Failure of Customer or 8SIGMA to enforce any of the terms and conditions of this Agreement shall not prevent a subsequent enforcement of such terms and conditions or be deemed a waiver of any subsequent breach. Should any provision of this Agreement, or a portion thereof, be unenforceable or in conflict with governing country, state, province, or local laws, then the validity of the remaining provisions, and portions thereof, shall not be affected by such unenforceability or conflict, and this Agreement shall be construed as if such provisions, or portion thereof, were not contained herein. This Agreement contains all agreements, understandings and representations of the parties and supersedes all prior oral or written agreements or representations. Customer acknowledges and agrees that it has not relied on any representations other than those contained in this Agreement. This Agreement shall not be varied, supplemented, qualified, or interpreted by any prior course of dealing between the parties or by any usage of trade and may only be amended by an agreement executed by both parties.