Standard Terms and Conditions of Purchase Applicable to Vendors Supplying Goods and Services to Ulterra

Standard Terms and Conditions of Purchase Applicable to Vendors Supplying Goods and Services to Ulterra

1. APPLICABILITY

a. All sales of goods and services by a vendor (“Vendor”) to Ulterra Drilling Technologies, L.P. and each of its parents, affiliates and subsidiaries (“Ulterra”) are subject to these standard terms and conditions of purchase (these “Terms”). Any accompanying purchase order (the “Purchase Order”) and these Terms (collectively, this “Agreement”) comprise the entire agreement between the parties, and supersede all prior or contemporaneous understandings, agreements, negotiations, representations and warranties, and communications, both written and oral. Terms and conditions of Vendor (whether contained in a purchase order confirmation or otherwise) that are in any way in conflict or inconsistent with or different or in addition to this Agreement (whether communicated orally or contained in a sales confirmation, delivery ticket, invoice or other written correspondence) shall not be binding on Ulterra and are rejected and shall not be considered applicable to any purchase of goods or services by Ulterra unless expressly agreed to in writing by Ulterra. The supply of goods or services to Ulterra pursuant to any purchase order or similar order of goods or services by Ulterra shall be conclusive evidence of Vendor’s approval of and consent to this Agreement.

b. This Agreement shall prevail over any of Vendor’s general terms and conditions of sale regardless whether or when Vendor has submitted its sales confirmation or such terms. This Agreement expressly limits Vendor’s acceptance to the terms of this Agreement. Fulfillment of the Purchase Order constitutes acceptance of this Agreement.

2. PRICES

The price of the goods and services is the price stated in the Purchase Order (the “Price”). If no price is included in the Purchase Order, the Price shall be the price set out in Vendor’s published price list in force as of the date of the Purchase Order. Unless otherwise specified in the Purchase Order, the Price includes all packaging, transportation costs to the Delivery Point, insurance, customs duties, and fees and applicable taxes, including, but not limited to, all sales, use or excise taxes. No increase in the Price is effective, whether due to increased material, labor or transportation costs or otherwise, without the prior written consent of Ulterra.

3. DELIVERY OF GOODS AND PERFORMANCE OF SERVICES

a. Vendor shall deliver goods in the quantities and on the date(s) specified in the Purchase Order or as otherwise agreed in writing by the parties (the “Delivery Date”). If Vendor fails to deliver the goods in full on the Delivery Date, Ulterra may terminate this Agreement immediately by providing written notice to Vendor and Vendor shall indemnify Ulterra against any losses, claims, damages, and reasonable costs and expenses directly attributable to Vendor’s failure to deliver the Goods on the Delivery Date. Ulterra has the right to return any Goods delivered prior to the Delivery Date at Vendor’s expense and Vendor shall redeliver such Goods on the Delivery Date.

b. Vendor shall deliver all goods to the address specified in the Purchase Order (the “Delivery Point”) during Ulterra’s normal business hours or as otherwise instructed by Ulterra. Vendor shall pack all goods for shipment according to Ulterra’s instructions or, if there are no instructions, in a manner sufficient to ensure that the Goods are delivered in undamaged condition. Vendor must provide Ulterra prior written notice if it requires Ulterra to return any packaging material. Any return of such packaging material shall be made at Vendor’s risk of loss and expense.

c. Vendor shall provide services to Ulterra as described and in accordance with the schedule set forth in the Purchase Order and in accordance with these Terms.

d. Vendor acknowledges that time is of the essence with respect to Vendor’s obligations hereunder and the timely delivery of goods and services, including all performance dates, timetables, project milestones and other requirements set forth in the Purchase Order.

e. Delivery shall be made FCA Delivery Point. The Purchase Order number must appear on all shipping documents, shipping labels, invoices, correspondence and any other documents pertaining to the Purchase Order

4. TERMS OF PAYMENT

Vendor shall issue an invoice to Ulterra on or any time after the completion of delivery and only in accordance with this Agreement. Unless Vendor and Ulterra otherwise agree in writing to payment terms other than those specified herein, payment shall be made in U.S. Dollars in accordance with remittance instructions furnished by Vendor. Payment terms are net sixty (60) days from date of invoice. Without prejudice to any other right or remedy it may have, Ulterra reserves the right to set off at any time any amount owing to it by Vendor against any amount payable by Ulterra to Vendor.

5. TITLE AND RISK OF LOSS

Title and risk of loss passes to Ulterra upon acceptance of the goods at the Delivery Point.

6. INSPECTION AND REJECTION OF NONCONFORMING GOODS

Ulterra has the right to inspect the goods on or after the Delivery Date. Ulterra, at its sole option, may inspect all or a sample of the goods, and may reject all or any portion of the goods if it determines the goods are nonconforming or defective. If Ulterra rejects any portion of the goods, Ulterra has the right, effective upon written notice to Vendor, to: (a) rescind the Purchase Order in its entirety; (b) accept the goods at a reasonably reduced price; or (c) reject the goods and require replacement of the rejected goods. If Ulterra requires replacement of the goods, Vendor shall, at its expense, promptly replace the nonconforming or defective goods and pay for all related expenses, including, but not limited to, transportation charges for the return of the defective goods and the delivery of replacement goods. If Vendor fails to timely deliver replacement goods, Ulterra may replace them with goods from a third party and charge Vendor the cost thereof and cancel this Purchase Order for cause pursuant to Section 8. Any inspection or other action by Ulterra shall not reduce or otherwise affect Vendor’s obligations under the Agreement, and Ulterra shall have the right to conduct further inspections after Vendor has carried out its remedial actions.

7. WARRANTY

a. Vendor warrants that the goods delivered hereunder are, and for a period of 12 months from the Delivery date will be, free from defects in materials, workmanship, and design, shall conform to the specifications represented by Vendor and/or requested by Ulterra, shall be merchantable and fit and sufficient for the use and purpose intended, shall conform to any and all warranties arising by usage of trade, course of dealing and course of performance, shall be free of all liens, security interests, or other encumbrances, and shall not infringe or misappropriate any third party’s patent or intellectual property rights. Such warranties shall not be deemed waived either by reason of Ulterra’s acceptance of or any payment for any goods and/or services, and shall extend to Ulterra and its transferees, including without limitation its customers.

b. Vendor warrants that it shall perform the services delivered hereunder using personnel of required skill, experience and qualifications and in a professional and workmanlike manner in accordance with generally recognized industry standards for similar services.

c. Vendor agrees to replace or correct promptly without expense to Ulterra (including shipping and other costs), any goods or services not conforming to the foregoing requirements as soon as reasonably possible after notification by Ulterra. In the event Vendor fails to correct or replace goods or services in a timely manner, Ulterra may correct or replace such items and charge Vendor the cost thereof. Such warranties and remedies shall be in addition to, and shall not limit in any way, any other warranties and remedies given by Vendor or arising by law.

8. CANCELLATIONS

Ulterra shall be permitted to cancel at any time any purchase order or other order of goods or services hereunder. In the event such cancellation occurs within 60 days of the placement of such order, Ulterra shall have no liability for such cancellation, and if such cancellation occurs after 60 days following placement of such order, Ulterra shall be responsible for any direct costs associated with such order, but only to the extent that the goods ordered or inventory and components relating to such order are not fungible, resaleable or useable by Vendor or a third party.

9. CHANGE ORDERS

Ulterra may at any time, by written instructions and/or drawings issued to Vendor (each a “Change Order”), order changes to the goods or services. Vendor shall within three days of receipt of a Change Order submit to Ulterra a firm cost proposal for the Change Order. If Ulterra accepts such cost proposal, Vendor shall proceed with the changed services subject to the cost proposal and this Agreement. Vendor acknowledges that a Change Order may or may not entitle Vendor to an adjustment in the Vendor’s compensation or the performance deadlines under the Purchase Order and these Terms.

10. VENDOR’S OBLIGATIONS REGARDING SERVICES

Vendor shall:
a. obtain and maintain all necessary licenses and consents and comply with all relevant laws applicable to the provision of the services;

b. comply with all rules, regulations and policies of Ulterra, including security procedures concerning systems and data and remote access thereto, building security procedures and general health and safety practices and procedures;

c. maintain complete and accurate records relating to the provision of the services, including records of the time spent and materials used by Vendor in providing the services in such form as Ulterra shall approve. During the term of this Agreement and for a period of two years thereafter, upon Ulterra’s written request, Vendor shall allow Ulterra to inspect and make copies of such records and interview Vendor personnel in connection with the provision of the services;

d. obtain Ulterra’s written consent, which shall not be unreasonably withheld or delayed, prior to entering into agreements with or otherwise engaging any person or entity, including all subcontractors and affiliates of Vendor, other than Vendor’s employees, to provide any services to Ulterra (each such approved subcontractor or other third party, a “Permitted Subcontractor”). Ulterra’s approval shall not relieve Vendor of its obligations and Vendor shall remain fully responsible for the performance of each such Permitted Subcontractor and its employees;

e. require each Permitted Subcontractor to be bound in writing by the confidentiality provisions of this Agreement, and, upon Ulterra’s written request, to enter into a non-disclosure or intellectual property assignment or license agreement in a form that is reasonably satisfactory to Ulterra;

f. ensure that all persons, whether employees, agents, subcontractors, or anyone acting for or on behalf of the Vendor, are properly licensed, certified or accredited as required by applicable law and are suitably skilled, experienced and qualified to perform the services;

g. ensure that all of its equipment used in the provision of the services is in good working order and suitable for the purposes for which it is used, and conforms to all relevant legal standards and standards specified by the Ulterra; and

h. keep and maintain any Ulterra equipment in its possession in good working order and shall not dispose of or use such equipment other than in accordance with the Ulterra’s written instructions or authorization.

11. GENERAL INDEMNIFICATION

Vendor shall defend, indemnify and hold harmless Ulterra and Ulterra’s subsidiaries, affiliates, successors or assigns and its respective directors, officers, shareholders and employees (collectively, “Indemnitees”) against any and all loss, injury, death, damage, liability, claim, deficiency, action, judgment, interest, award, penalty, fine, cost or expense, including reasonable attorney and professional fees and costs, and the cost of enforcing any right to indemnification hereunder and the cost of pursuing any insurance providers (collectively, “Losses”) arising out of or occurring in connection with the goods and services purchased from Vendor or Vendor’s negligence, willful misconduct or breach of the Terms. Vendor shall not enter into any settlement without Ulterra’s prior written consent.

13. CONFIDENTIAL INFORMATION

All non-public, confidential or proprietary information of Ulterra, including but not limited to, specifications, samples, patterns, designs, plans, drawings, documents, data, business operations, customer lists, pricing, discounts or rebates, disclosed by Ulterra to Vendor, whether disclosed orally or disclosed or accessed in written, electronic or other form or media, and whether or not marked, designated or otherwise identified as “confidential” in connection with these Terms and the Purchase Order is confidential and may not be disclosed or copied unless authorized in advance by Ulterra in writing. Upon Ulterra’s request, Vendor shall promptly return all documents and other materials received from Ulterra. Ulterra shall be entitled to seek injunctive relief for any violation of this Section. This Section does not apply to information that is: (a) in the public domain; (b) known to Vendor at the time of disclosure; or (c) rightfully obtained by Vendor on a non-confidential basis from a third party.

14. FORCE MAJEURE

No party shall be liable or responsible to the other party, nor be deemed to have defaulted under or breached this Agreement, for any failure or delay in fulfilling or performing any term herein (except for any obligations to make payments to the other party hereunder), when and to the extent such party’s (the “Impacted Party”) failure or delay is caused by or results from the following force majeure events (“Force Majeure Event(s)”): (a) acts of God; (b) flood, fire, earthquake, pandemics, or explosion; (c) war, invasion, hostilities (whether war is declared or not), terrorist threats or acts, riot or other civil unrest; (d) government order, law, or action; (e) embargoes or blockades in effect on or after the date of the Purchase Order; (f) national or regional emergency; (g) strikes, labor stoppages or slowdowns or other industrial disturbances; (h) shortage of adequate power or transportation facilities; and (i) other similar events beyond the reasonable control of the Impacted Party. The Impacted Party shall give notice within 10 days of the Force Majeure Event to the other party, stating the period of time the occurrence is expected to continue. The Impacted Party shall use diligent efforts to end the failure or delay and ensure the effects of such Force Majeure Event are minimized. The Impacted Party shall resume the performance of its obligations as soon as reasonably practicable after the removal of the cause. In the event that the Impacted Party’s failure or delay remains uncured for a period of 30 consecutive days following written notice given by it, the other party may thereafter terminate this Agreement upon 30 days’ written notice.

15. COMPLIANCE WITH LAWS

Vendor shall comply with all applicable laws, regulations and ordinances. Vendor shall maintain in effect all the licenses, permissions, authorizations, consents and permits that it needs to carry out its obligations under this Agreement. Vendor shall comply with all export and import laws of all countries involved in the sale of the goods under this Agreement or any resale of the goods by Vendor. Vendor assumes all responsibility for shipments of goods requiring any government import clearance. Ulterra may terminate this Agreement if any governmental authority imposes antidumping or countervailing duties or any other penalties on goods.

16. TERMINATION

In addition to any remedies that may be provided under this Agreement, Ulterra may terminate this Agreement with immediate effect upon written notice to Vendor, either before or after the acceptance of the goods or the seller’s delivery of the services, if Vendor has not performed or complied with this Agreement, in whole or in part. If Vendor becomes insolvent, files a petition for bankruptcy or commences or has commenced against it proceedings relating to bankruptcy, receivership, reorganization or assignment for the benefit of creditors, then Ulterra may terminate this Agreement upon written notice to Vendor. If Ulterra terminates the Agreement for any reason, Vendor’s sole and exclusive remedy is payment for the goods received and accepted and services accepted by Ulterra prior to the termination.

17. RELATIONSHIP OF THE PARTIES

The relationship between the parties is that of independent contractors. Nothing contained in this Agreement shall be construed as creating any agency, partnership, joint venture or other form of joint enterprise, employment or fiduciary relationship between the parties, and neither party shall have authority to contract for or bind the other party in any manner whatsoever.

18. SEVERABILITY

Any provision of this Agreement that is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provisions in any other jurisdiction. To the extent permitted by applicable law each party hereby waives any provision of law which renders any provisions hereof prohibited or unenforceable in any respect.

19. GOVERNING LAW AND FORUM

This Agreement shall be interpreted in accordance with the laws of the state of Texas, regardless of the conflict of law provisions thereof. The parties hereto agree that any litigation arising out of this Agreement shall be in the state of Texas. Any legal action by Vendor for breach must be commenced within one (1) year from the date of the breach. Vendor agrees to pay all costs and expenses, including reasonable attorney’s fees incurred by Vendor in any action to enforce its rights hereunder. The United Nations Convention on the Contracts for International Sale of Goods, 1980, and any amendment or successor thereto is expressly excluded from this Agreement.

20. WAIVER

No waiver by Vendor of any of the provisions of this Agreement is effective unless explicitly set forth in writing and signed by Ulterra. No failure to exercise, or delay in exercising, any right, remedy, power or privilege arising from this Agreement operates, or may be construed, as a waiver thereof. No single or partial exercise of any right, remedy, power or privilege hereunder precludes any other or further exercise thereof or the exercise of any other right, remedy, power or privilege.

21. ASSIGNMENT

Vendor shall not assign, transfer, delegate or subcontract any of its rights or obligations under this Agreement without the prior written consent of Ulterra. Any purported assignment or delegation in violation of this Section shall be null and void. No assignment or delegation shall relieve the Vendor of any of its obligations hereunder. Ulterra may at any time assign or transfer any or all of its rights or obligations under this Agreement without Vendor’s prior written consent to any affiliate or to any person acquiring all or substantially all of Ulterra’s assets.

22. AMENDMENT AND MODIFICATION

This Agreement may only be amended or modified in a writing stating specifically that it amends this Agreement and is signed by an authorized representative of each party.

23. SURVIVAL

Provisions of this Agreement that by their nature should apply beyond their terms will remain in force after any termination or expiration of this Agreement including, but not limited to, the following provisions: Compliance with Laws, Confidential Information, Governing Law and Forum, and Survival.

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