MASTER PURCHASE AGREEMENT No. MP A-002-2006 Between PETROBRAS AMERICA INC. And UNITED ENERGY CORP. Effective Date: February 23, 2006 to February 23, 2009
Exhibit
10.16
No.
MP
A-002-2006
Between
PETROBRAS
AMERICA INC.
And
UNITED
ENERGY CORP.
Effective
Date:
February
23, 2006 to February 23, 2009
THIS
AGREEMENT, dated as of February 23,2006 (the "Effective Date"), entered into
by
and between Petrobras America Inc., a Delaware corporation having its principal
office at 00000 Xxxxxxxxxx Xxxx, Xxxxx 0000, in Houston, Xxxxxx County, Texas,
hereinafter referred to as "PURCHASER", and United Energy Corporation,
incorporated in the State of Nevada, hereinafter referred to as "SELLER".
WITNESSED:
WHEREAS,
PURCHASER and SELLER desire to enter into this Master Purchase Agreement
in
order to agree and establish the general terms and conditions of SELLER'S
potential future sales and deliveries of any or all of the SELLER'S oil and
gas
well production enhancement products as listed in Schedule I (hereinafter
collectively referred to as "PRODUCTS"),
WHEREAS,
SELLER is willing and able to sell and deliver from time to time to PURCHASER
as
the case may be, the PRODUCTS in accordance with the general terms and
conditions set forth herein,
WHEREAS,
PURCHASER desires to enter into a cooperative Master Purchase Agreement with
SELLER aimed at reducing administrative costs, improving order cycle times,
and
simplifying the process of acquisition of PRODUCTS offered by SELLER as selected
by PURCHASER.
WHEREAS,
the parties wish to set forth their agreement with respect to the foregoing
and
related matters,
NOW,
THEREFORE, in consideration of the premises and other good and valuable
consideration hereinafter set forth, PURCHASER and SELLER agree as follows:
DEFINITIONS:
AGREEMENT/CONTRACT
- Shall mean this entire Master Purchase Agreement acknowledged and signed
by
the Parties, which shall govern all purchasing transactions initiated by
the
PURCHASER for the length of time established herein and covering those PRODUCTS
contained in the PRODUCT LIST.
CLIENT
-
Hereby refers to customers of the PURCHASER who are the end users of the
PRODUCTS sold by SELLER to PURCHASER. SELLER acknowledges that PURCHASER
is not
anticipated to be the ultimate end user of any PRODUCTS it sells and that
PURCHASER will re-sell those PRODUCTS to its clients.
DAYS
-
Unless otherwise indicated herein "day[s]" shall mean a normal business day
defined as Monday through Friday
EXHIBITS
- Shall mean the documents attached hereto and incorporated herein for all
purposes.
MADE-TO-ORDER
PRODUCTS - PRODUCTS not maintained as part of the stock inventory and which
require the SELLER to design, manufacture, produce or purchase all or part
of
the end product as requested by PURCHASER in order to meet the specifications
or
technical aspects of the PRODUCTS sought by PURCHASER.
PRODUCTS
- Shall mean SELLER'S formulations of oil and gas well production enhancement
products listed on Schedule I, as such exhibit may be amended from time to
time
during the Term hereof.
PRODUCT
LIST - Shall mean SELLER'S PRODUCTS and price list as identified on Schedule
I
any and all documents and electronic lists demonstrating the PRODUCTS that
are
available for sale, including PRODUCTS in the SELLER's inventory as well
as any
PRODUCTS classified as MADE-TO-ORDER.
PURCHASE
ORDER - Shall mean an official Purchase Order, whether generated electronically
or on paper, executed by PURCHASER
and/or authorizing the supply of PRODUCTS by SELLER. .
STOCK
PRODUCTS - Are those PRODUCTS generated or maintained as part of the SELLER'S
inventory at the time of the placement of the Purchase Order.
ARTICLE
I. GENERAL PROVISIONS
1.1 Mutual
Agreement.
The
parties hereto agree that this Master Purchase Agreement sets forth the general
terms and conditions that shall govern all sale and purchase transactions
between PURCHASER and SELLER for PRODUCTS, from time to time for the Term
and
under the scope of this Master Purchase Agreement, pursuant to each individual
Purchase
Order (hereinafter defined "PO"). The
terms
and conditions of this Agreement are incorporated by reference in each PO.
1.2 Term.
The
term ("Term") of this Master Purchase Agreement shall commence on the Effective
Date and subject to early termination in accordance with the terms and
conditions herein, shall remain in full force and effect for an initial period
of three (3) years, and thereafter shall be subject to renewal for successive
three (3) year periods upon the written agreement of both parties prior to
the
expiration date of the then existing Term. Both parties may at any time agree
in
writing to early termination of the Term.
1.3
No
Exclusivity.
Notwithstanding anything contained herein to the contrary, the parties agree
that this is not an exclusivity agreement and nothing in this Master Purchase
Agreement requires PURCHASER to purchase any PRODUCTS solely from SELLER
or
requires SELLER to sell PRODUCTS exclusively to PURCHASER; provided, however,
that during the Term of this Master Purchase Agreement, SELLER shall sell
and
deliver to PURCHASER, PRODUCTS, in accordance with the terms and conditions
herein.
SELLER
acknowledges that PURCHASER is not anticipated to be the ultimate end user
of
any PRODUCTS it purchases from SELLER, and that PURCHASER will re-sell those
PRODUCTS to its CLIENT.
ARTICLE
II. PURCHASE ORDERS
2.1 Issuance
of Purchase Orders.
SELLER
shall sell and deliver to PURCHASER and PURCHASER shall purchase from SELLER
PRODUCTS, when the same are ordered by PURCHASER, as set forth below:
2.1
(a)
PURCHASER may issue to SELLER one or more POs for PRODUCTS. The PO is the
exclusive instrument to be used by PURCHASER and shall be governed by the
general terms and conditions set forth herein, and this Master Purchase
Agreement is expressly referenced in the text of the PO, and shall be considered
incorporated therein by reference.
2.1
(b)
No sale or transaction of any kind related to this Agreement shall be valid
without the issuance and execution of a Purchase Order.
2.I(c)
PURCHASER may send POs to SELLER in an electronic form (e.g., e-mail attachments
in Microsoft Word or Excel, Adobe Acrobat, XML, Browser-Web) compatible with
SELLER'S systems requirements, via facsimile, or regular mail.
2.2
Acceptance
of Purchase Orders.
SELLER
shall, within ten (10) days of the receipt of any PO from PURCHASER, issue
to
PURCHASER a written acceptance thereof or if rejected, a written explanation
of
the reasons for such rejection. Provided, however, that SELLER may reject
a PO
only for legitimate business reasons. If PURCHASER does not receive such
written
explanation of the reasons for rejection of a PO within the ten (10) days
following SELLER'S receipt of such PO, then said PO shall be deemed accepted
by
SELLER for purposes of this Master Purchase Agreement. If unable to meet
the
delivery time requested in any PO, SELLER may propose a revised delivery
time,
then PURCHASER, at its discretion, may accept such revised delivery time
or
withdraw the relevant PO without any liability whatsoever, as provided in
Article 2.3.
2.3.4
Prevalence.
Except
for the provisions applicable to the delivery time, in the event of any conflict
or discrepancy that may appear between the terms and conditions of this Master
Purchase Agreement and any POs, the terms and conditions of this Master Purchase
Agreement and its attached exhibits shall prevail.
2.4
Assurances.
SELLER
agrees to give PURCHASER reasonable assurances of SELLER'S ability to perform
its obligations under this Master Purchase Agreement upon PURCHASER'S request
for such assurances and to provide follow-up with SELLER'S own factory, its
vendors or subcontractors on each PO to ensure that the delivery date provided
therein and other stipulations provided herein are met.
ARTICLE
III.
DELIVERY
TERMS
3.1
Delivery.
SELLER
shall deliver the PRODUCTS to PURCHASER'S EXW ("EX Works"), SELLER'S Plant
on
the agreed delivery time and at the agreed delivery point in accordance with
the
applicable PO and the terms and conditions set forth herein. In addition,
SELLER
AND PURCHASER ACKNOWLEDGE AND AGREE THAT TIME IS OF THE ESSENCE WITH RESPECT
TO
THE DELIVERY OF PRODUCTS HEREUNDER. SELLER agrees to provide frequent follow-up
to POs designated as "CRITICAL PRODUCTS" since they represent first priority
requirements as set forth in Exhibit A, (Delivery Times). Notwithstanding
the
foregoing, the parties may agree upon other delivery terms, in which event,
the
parties shall also agree upon any adjustments to the general commercial terms
applicable hereunder, taking into account all relevant circumstances.
3.2
Title
and Risk of Loss.
Risk of
loss or damage of PRODUCTS sold under any PO and title to PRODCUTS shall
pass to
PURCHASER, as the case may be, upon SELLER's delivery of PRODUCT EXW, SELLER'S
Plant, in accordance with the Incoterms 2000 published by the International
Chamber of Commerce. Notwithstanding the foregoing, the parties may agree,
in
exceptional cases, to other delivery terms.
3.3
Containers.
SELLER
shall deliver the PRODUCT in 55 gallon drums, separately labeled, as per
the
warehouse number and final destination indicated in the applicable POs or
by
other means of transport in accordance with the terms of a Purchase Order.
3.4
Shipping
Documents.
SELLER
shall submit to PURCHASER a commercial invoice as well as those documents
required by the authorities of the exporting country, for each shipment of
PRODUCTS pursuant to a PO, which shall meet the invoicing requirements indicated
in Exhibit D, (Requirements for Payment). For clearance of the customs
authorities of the country of importation, SELLER shall produce and submit
the
certificate of country of origin and/or any other documents needed for customs
clearance. In the event that, by changes in the applicable laws and regulations,
further documentation would be required for tile effective and timely
exportation from the country of origin and importation into the designated
country. SELLER agrees to use its best reasonable efforts to produce any
required documentation. If SELLER fails to fully comply with the provisions
of
this Article 3.4, SELLER shall be liable for any and all charges related
to
insurance, transportation, storage, detention or demurrage charges, penalties
and fees related thereto. In such circumstance PURCHASER shall have the right
to
charge SELLER for those charges and/or make deductions from any outstanding
invoice at PURCHASER'S election. In addition, shipments shall not be deemed
delivered when lack of required documentation persists. SELLER shall provide
to
PURCHASER with the information herein described accurately and in a timely
manner. Furnishing this information by SELLER shall be a pre-condition for
process of payment.
3.5
SELLER'S
Delivery Performance.
SELLER
shall meet a minimum of90% On-Time Delivery of the total number of POs delivered
within six (6) months period. If SELLER'S On-Time Delivery falls under 90%,
subject to exceptions for Force Majeure SELLER shall have four weeks to present
a detailed plan to reach the minimum performance agreed in this Master Purchase
Agreement. Notwithstanding the foregoing, if SELLER fails to comply with
the
minimum delivery performance after the four weeks period (the "Grace Period"),
Liquidated Damages for Delay will apply as per Article 3.5.1.
3.5.1
Liquidated
Damage for Delay.
In the
event SELLER fails to make delivery within the time established following
the
Grace Period as provided under Article 3.5, PURCHASER may at its option
terminate the PO or part thereof as to which there has been delay without
incurring cancellation charges or any other costs. Should PURCHASER elect
to
maintain such PO active, SELLER shall be subject to Liquidated Damages of
one
percent (1 %) of the total value of the delayed PRODUCT or PRODUCTS per week
of
delay regarding PRODUCTS delivered after the Grace Period. This Liquidated
Damages Article shall start from the eighth (8th) day of delay and up to
the day
the PRODUCTS are delivered in accordance with the terms of this Agreement
and
meet all specific requirements contained in the PO as previously agreed to,
but
in any event shall not exceed ten percent (10%) of the total value of the
PRODUCTS on any individual PO. PURCHASER'S failure to exercise this Liquidated
Damages Article when applicable within any specific time frame or any specific
occasion shall not be deemed to be a waiver of said Article at any time.
PURCHASER,
at its discretion, shall be entitled to forthwith deduct the accrued applicable
liquidated damages from any outstanding invoice. In the event there are no
outstanding invoices, SELLER shall immediately issue a credit note for the
benefit of PURCHASER, establishing the applicable delay charge. The provision
in
this Article 3.5.1 shall be SELLER'S sole liability and PURCHASER'S sole
remedy
for delay in delivery.
ARTICLE
IV. INSPECTION, REJECTION
4.1
Inspection.
PURCHASER, at its own expense, reserves the right to appoint a competent
inspection company approved by SELLER to perform services on its behalf at
SELLER'S plant, or at the plant of a third party contracted by SELLER, through
a
qualified service representative (hereinafter the "Inspector"). Inspector
shall
be responsible for performing any inspection services required by PURCHASER
in
accordance with an inspection protocol subject to be determined in accordance
with the further mutual agreement between PURCHASER and SELLER (Inspection
Services).
4.2
Rejection.
Upon
inspection at the final destination, PURCHASER may reject any or all PRODUCTS
delivered by SELLER hereunder that are non-conforming as reasonably determined
by PURCHASER as per Exhibit C, (Discrepancies).
ARTICLE
V. INVOICING; PRICE AND PAYMENT; TAXES
5.1
Invoicing.
SELLER
shall, within three (3) business days after delivery, submit to PURCHASER
sales
invoices in US Dollars, together with copies of the xxxx of lading and/or
relevant shipping documents evidencing delivery. Such sales invoices shall
contain all the information requested in Exhibit D, (Requirements for Payment).
No payment shall be due if such sales invoices are submitted without the
proper
shipping documents.
5.2
Price
and Payment.
Within
thirty (30) days after receipt of a proper sales invoice, accompanied by
the
documents evidencing delivery, PURCHASER shall pay to SELLER the price for
the
PRODUCTS so invoiced, in accordance with the PRODUCT LIST set forth in Schedule
1. The invoices shall include the discounts as calculated in accordance with
the
discount program included in Exhibit E (Discount Program). PURCHASER reserves
the right to request SELLER to provide additional documentation that any
financing entity may request, from time to time, in order to process payment.
5.3
Taxes.
Except
as otherwise expressly provided herein, each party shall bear and pay each
of
the corresponding taxes, charges, withholdings, fees, levies, tariffs and
duties
of any kind or nature, now existing or which may hereafter come into effect,
imposed on such party or its agents, subcontractors, officials or employees
that
each party has the obligation to pay during the execution and fulfillment
of
this Master Purchase Agreement and/or any PO according to Federal, State
and
Municipal laws.
Notwithstanding
the foregoing, the SELLER'S sales invoice shall include, and PURCHASER shall
pay
any sales tax required to be paid by PURCHASER and collected by SELLER in
accordance with applicable law.
ARTICLE
VI. PRODUCT LIST &
PRICING
6.1
Prices.
The
prices of PRODUCTS set forth in Schedule I shall remain fixed and effective
for
at least the balance of the calendar year after the Effective Date with the
exception of a "pass through" increase for SELLER's increase in cost for
component raw material price increases, which cost increases shall be subject
to
documentation upon PURCHASER's request. Subject to the foregoing, annual
revisions to the PRODUCT LIST, if any, shall be per the guidelines set forth
in
Exhibit F. If the revised PRODUCT LIST is not provided to PURCHASER thirty
(30)
days before the then current PRODUCT LIST expires, the current PRODUCT LIST,
including net and PRODUCT LIST shall have its validity extended until the
revised PRODUCT LIST goes into effect. If the revised PRODUCT LIST complies
with
the requirements set forth in Exhibit F, such PRODUCT LIST will go into effect
thirty (30) days after it is received by PURCHASER. During the validity of
the
PRODUCT LIST, if necessary, SELLER may revise, update, modify, improve or
supplement each PRODUCT included in the PRODUCT LIST; if this requires an
increase in a PRODUCT'S price, SELLER shall promptly request approval from
PURCHASER and submit the relevant justification. PRODUCT with superseding
part
numbers shall maintain tile price of the superseded PRODUCT during the validity
of the PRODUCT LIST.
ARTICLE
VII. REPRESENTATIONS AND WARRANTIES
SELLER
hereby represents and warrants to PURCHASER as follows:
7.1 Title.
SELLER
warrants that it has clear, good and marketable title to each PRODUCT to
be sold
and delivered hereunder, free and clear of any and all claims, liens,
encumbrances, equities and restrictions of every kind and nature whatsoever.
PURCHASER shall be entitled to use the PRODUCTS without disturbance, provided
PURCHASER agrees that any alteration of the PRODUCTS by dilution, addition
of
additives or otherwise, will void any SELLER's warranty
7.2
Proprietary
Rights.
SELLER
warrants having the rights to design, manufacture, and sell PRODUCTS included
in
tl1is Agreement. Each PRODUCT and its use does not and will not violate or
infringe any patent, copyright, trade secret or other proprietary right of
any
other person or entity or contribute to such violation or infringement in
any
country. In tile event of breach of the warranty set forth in tins Section
7.2,
SELLER shall, at its own cost and expense, at PURCHASER'S discretion, either
(i)
procure for PURCHASER the right to continue to use such PRODUCT as contemplated
hereunder, or (ii) replace or modify such PRODUCT to make their use
non-infringing, while being capable of performing the same function without
degradation of performance, and/or (iii) indemnify, defend, and hold PURCHASER
harmless from any liabilities, damages, claims, judgments, expenses and
disbursements, of any kind and nature whatsoever, related in any way to a
breach
of the warranty set forth herein. If SELLER accomplishes none of the foregoing,
PURCHASER shall have the right to terminate the corresponding PO.
7.3
Quality.
PRODUCTS sold by SELLER shall conform to PRODUCT specifications provided
by
SELLER to PURCHASER, which specifications may be revised and updated from
time
to time following written notice of such change to PURCHASER. For eighteen
(18)
months
following the transfer of title hereunder PRODUCT shall function properly
under
intended, ordinary and proper use. SELLER AND PURCHASER ACKNOWLEDGE AND AGREE
THAT COMPLIANCE WITH THE ABOVE WARRANTIES IS OF THE ESSENCE FOR THE PERFORMANCE
HEREUNDER. Any breach of any warranty set forth in this Article 7.3 shall
be
remedied by the replacement of the non-conforming PRODUCT at no charge to
PURCHASER, in a timely and professional manner by SELLER. If SELLER is unable
to
make such replacements in a timely fashion, PURCHASER may terminate the
corresponding Purchase Order, as per the terms and conditions herein.
PURCHASER
covenants, warrants and represents to the SELLER as follows:
7.4
No
Alteration.
PURCHASER will not dilute or in any other manner alter the composition of
the
PRODUCTS and will not provide to its Clients, instructions, guidelines or
warranties regarding the use or application of the PRODUCTS which are not
in
accord with PRODUCT use and application guidelines and instructions and PRODUCT
warranties as published and provided by the SELLER to PURCHASER from time
to
time during the Term hereof.
ARTICLE
VIII. INDEMNIFICATION
8.1 Indemnification
by SELLER.
SELLER
warrants that the PRODUCTS shall be delivered tree of any rightful claim
of any
third party for infringement of any patent of the United States, or infringement
of any patent of another country. SELLER shall indemnify PURCHASER and its
employees; or its agents and their employees; or the CLIENT and its employees;
or its agents and their employees from any and all damages, costs, expenses
or
liabilities incurred as a result of any such claim of infringement. Upon
notice
in writing of a claim and given authority, information and reasonable assistance
by PURCHASER, SELLER shall defend, or may settle at its expense, any claim,
suit
or proceeding against PURCHASER and its employees; or its agents and their
employees; or against the CLIENT and its employees; or its agents and their
employees; and SELLER shall pay all judgments, damages and costs awarded
therein
against PURCHASER and its employees; or its agents and their employees; or
against the CLIENT and its employees; or its agents and their employees.
In the
event any PRODUCTS is held to constitute such an infringement and the use
for
the purpose intended of said PRODUCTS is enjoined, SELLER shall, at its expense
and option, either procure for the CLIENT the right to continue using the
PRODUCTS or replace same with non-infringing PRODUCTS, or modify same so
they
become non-infringing, or remove the PRODUCTS and refund the purchase price.
8.2
Limitations
of Liability.
The
remedies of PURCHASER and Indemnification obligations of SELLER set forth
in
this Article VIII herein are exclusive as stated, and in any event, the total
liability of SELLER with respect to claims under this Master Purchase Agreement
or PO shall not exceed, per occurrence, the invoice price For SELLER'S PRODUCT.
No party shall be liable to any other party for any consequential, indirect
or
punitive damages arising out of this Master Purchase Agreement or PO, including
claims based on loss of profits or revenues.
8.3
Insurance.
SELLER
shall, during the Term of this Master Purchase Agreement, at its sole cost
and
expense, obtain and maintain all insurance coverage required by law and such
insurance as is necessary to protect SELLER and PURCHASER against liability
from
Claims arising in connection with or relating to the use of SELLER'S PRODUCT
pursuant to this Master Purchase Agreement. SELLER shall furnish PURCHASER
with
a certification of insurance coverage upon PURCHASER'S written request.
8.4
SELLER'S
Warranty.
SELLER,
for a period of one year from date of sale of PRODUCT, warrants its PRODUCT
to
be free from defects in composition. SELLER'S obligation under this warranty,
is
limited to replacement of PRODUCT; this warranty being expressly IN LIEU
OF ALL
OTHER WARRANTIES, EXPRESSED OR IMPLIED OF MERCHANTABILITY OR FITNESS FOR
PARTICULAR PURPOSE, and of all other obligations and liabilities on SELLER’S
part, SELLER neither assumes nor authorizes any person to assume for it,
any
other liability in connection with the sale of PRODUCTS. This Warranty shall
not
apply to any PRODUCT that shall have been altered in any way, nor to any
PRODUCT
that shall have been used or applied contrary to SELLER'S printed instructions.
NO OTHER WARRANTY EXPRESSED OR IMPLIED, WHETHER OF FITNESS FOR A PARTICULAR
PURPOSE OR OF MERCHANTABILITY OR OF ANY OTHER KIND, SHALL EXIST IN RESPECT
TO
SUCH PRODUCT.
ARTICLE
IX. TERMINATION
9.1
Termination
for Cause of this Master Purchase Agreement.
In the
event that PURCHASER, or SELLER hereto defaults in the performance of any
of its
duties or obligations hereunder, which default is not cured within t11irty
(30)
days after written notice is given by the non-defaulting party to the defaulting
party specifying tile default, then the party not in default may, by giving
t11irty (30) days prior written notice thereof to the defaulting party,
terminate this Master Purchase Agreement without any liability whatsoever,
provided that the defaulting party shall be liable as per Article 9 herein.
The
termination of this Agreement based on this Article shall not affect any
PO
which has been previously accepted by SELLER prior to the effective date
of
termination of this Master Purchase Agreement.
The
insolvency or voluntary or involuntary liquidation of any party hereto, or
any
party becoming the subject of judicial reorganization or bankruptcy proceedings,
or instituting any legal proceeding under any law under which it seeks to
obtain
protection from its creditors that affect the ordinary course of its operations
shall be a cause for termination under this Article 9.1.
9.2
Termination
for Cause of Purchase Order.
PURCHASER may terminate the relevant Purchase Order accepted by SELLER, or
portion thereof, by giving written notice to SELLER specifying such termination:
(i) if any PRODUCT specified in that Purchase Order is non-conforming, and
upon
failure of SELLER to comply with the provisions of Article 4.2; and (ii)
if the
Purchase Order total or partial delivery is delayed after the period in which
PURCHASER is entitled to collect liquidated damages under Article 3.5.1 herein,
in which case SELLER shall refund to PURCHASER an amount equal to the sum
then
already paid by PURCHASER to SELLER for that Purchase Order, or a portion
thereof, if any, as well as related shipping expenses (back and forth) or
a
portion thereof, if any. Either PURCHASER or SELLER may terminate the relevant
Purchase Order if a force majeure event occurs in accordance with Article
11.5
herein.
9.3
Termination
for Convenience of Purchase Order.
If
PURCHASER terminates without cause a Purchase Order for Made to Order Product
or
a portion thereof (accepted by SELLER) and SELLER has already commenced the
manufacturing of non-stock Purchase Order specifically for such Purchase
Order
or if PURCHASER terminates without cause a PO for PRODUCT already delivered
Ex-work, then (i) SELLER in the case of MADE TO ORDER PRODUCT shall forthwith
take all reasonably necessary steps, including the sale of canceled Purchase
Orders for Made to Order Product to third parties, in order to minimize or
mitigate any damages or losses which SELLER may incur in connection with
such
termination, and (ii) SELLER in the case of PRODUCT already delivered Ex-Work
shall be entitled to a consideration, that in no event shall exceed the
aggregate purchase price of the canceled Purchase Orders.
ARTICLE
X. ARBITRATION AND GOVERNING LAW
10.1
Arbitration.
Any
claims, disputes and controversies arising out of or relating to this Master
Purchase Agreement, which can not be adjusted by mutual agreement shall,
upon
written notice by one party to the other, be determined by arbitration in
accordance with and subject to the Commercial Arbitration Rules of the American
Arbitration Association. The place of arbitration shall be Houston, TX USA.
The
language of the arbitration shall be English. The party desiring arbitration
shall notify the other party in writing of the matter to be arbitrated and
the
name of the arbitrator selected by said party. Within the following ten (10)
days after receipt of such notice, the other party shall appoint an arbitrator
and shall forthwith notify the first party of such appointment. After
confirmation by the American Arbitration Association, the two (2) arbitrators
so
named shall within the following ten (10) days appoint, in writing, a third
arbitrator. Should such arbitrators fail to agree upon a third arbitrator,
within the following ten (10) days, he or she shall be appointed by the American
Arbitration Association. Pending a decision by the arbitrators, both parties
agree to take no action that may upset the status quo, or prejudice the
respective positions of the parties in respect to the matter in controversy.
Any
awards granted by the arbitration panel shall be final and binding upon both
parties and judgment upon the award may be entered in any court of competent
jurisdiction.
10.2
Governing
Law.
The
laws of the State of Texas, USA, excluding any conflict of laws rules that
would
require otherwise, shall apply to and govern the interpretation, performance
and
enforcement of this Master Purchase Agreement. The parties hereby agree that
the
provisions of the United Nations Convention on Contracts for the International
Sale of Goods shall not apply to this Master Purchase Agreement, nor shall
it
have any application to the interpretation, performance or enforcement of
this
Master Purchase Agreement. It is being understood that the parties hereby
expressly waive compliance with such Convention.
10.3
Taxes.
Unemployment Benefits.
SELLER
hereby accepts exclusive liability for, and agrees to indemnify PURCHASER
against liability for the payment of any and all liens, contributions, payroll
taxes, unemployment benefits, fees, assessments, pensions, annuities, increased
wages and all other costs now or hereafter imposed directly or indirectly
on
acc9unt of SELLER'S work, labor, or services required under or relating to
any
Purchase Orders from PURCHASER in connection with this Agreement, whether
imposed by the government of the United States, of any State, or by any other
legal authority within the United States of America. PURCHASER reserves the
right to pay any amounts in connection with the SELLER'S liabilities listed
above and deduct the corresponding amounts from the payment of any outstanding
invoices from SELLER.
10.4
Fair
Labor Standards Act.
SELLER
warrants that all PRODUCTS covered by this Agreement have been produced in
compliance with the requirements of the Fair Labor Standard Act of 1938,
as
amended, and regulations and orders pursuant thereto, issued by the United
States Department of Labor.
10.5
Health.
Safety. and Environment (HSE).
All
hazardous materials shall be properly packaged and labeled. One copy of the
Material Safety Data Sheet (MSDS) and/or other applicable certificates shall
be
enclosed in a water-proof envelope attached to the outside of the package
and
conspicuously identified, and one copy sent directly to the Contract Coordinator
named on the face of this Purchase Order. An emergency telephone number shall
be
provided on the MSDS, as required by law. SELLER shall select only carriers
that
meet all applicable current rules and regulations regarding the safe handling
and transportation of hazardous goods in the country of origin, including
but
not limited to The Hazardous Materials Transportation Act (49 U.S.C. 1801
et
seq.) and the regulations contained in Title 49, Code of Federal Regulations,
Parts 100-178 (including exemptions and approvals issued hereunder) when
goods
are shipped from the U.S.A. SELLER also agrees to hold PURCHASER harmless
from
any claims, suits, or cause of action in connection with any hazardous or
otherwise dangerous materials issue arising out of the purchase of the goods
from SELLER by PURCHASER.
ARTICLE
XI. MISCELLANEOUS
11.1
Confidentiality.
All
information proprietary in nature or otherwise confidential exchanged by
the
parties shall not be disclosed or made available to any third party or used
in
any way outside the scope of this Agreement without the previous consent
in
writing of the party disclosing the proprietary information. Both PURCHASER
and
SELLER shall take all reasonable precautions to protect such information
from
unauthorized or negligent disclosure, whether such information is obtained
in
print or electronic format, or represents knowledge acquired from access
to any
of the party's business office, job site, shop, or restricted areas where
development work or other work of proprietary nature is being conducted.
All
such proprietary information obtained by PURCHASER during the Term of this
agreement shall be returned to SELLER upon termination of this agreement.
11.2
Amendments
or Additions.
SELLER
acknowledges and agrees that PURCHASER will exclusively be the only party
that
might negotiate with SELLER amendments or additions to this Master Purchase
Agreement. Such amendments or additions shall be in writing and signed by
PURCHASER and SELLER.
11.3
No
Waiver.
No
delay or omission by either party hereto in the exercise of any right or
remedy
hereunder shall impair such right or remedy or be construed to be a waiver
thereof. Any waiver of any such right or remedy by any party must be in writing
and signed by the party's representative against which such waiver is sought,
and such waiver shall not be construed to be a waiver of any succeeding breach
thereof or of any other covenant herein contained.
11.4
Assignment.
This
Master Purchase Agreement shall be binding on the parties hereto and their
respective successors and permitted assignees, but no party may assign this
Master Purchase Agreement without the prior written consent of PURCHASER
and
SELLER.
11.5
Force
Majeure.
Except
as otherwise provided in this Master Purchase Agreement, neither party shall
be
subject to any liability hereunder for loss or damage to the extent such
loss or
damage is directly caused by unforeseen and unavoidable occurrences or
situations beyond the reasonable control of the parties, which shall include
but
not be limited to: acts of God, hurricanes, riots, wars (declared or
undeclared), insurrection, terrorist acts, laws, decrees, regulations, orders
or
other directives or actions of either general or particular application of
any
governmental authority or any political subdivision thereof. In the event
that
either party hereto is rendered unable, wholly or in part, to carry out its
obligations under the Master Purchase Agreement and/or POs due to force majeure,
such party shall give notice and details of the force majeure in writing
to the
other party as promptly as possible after its occurrence. In case of force
majeure, the obligations of the parties shall be suspended during the
continuance of any
inability so caused. If such suspension continues for a period of one hundred
twenty (120) days, either party shall have the right to terminate without
prejudice the corresponding PO.
11.6 Notices.
All
notices hereunder shall be in writing and sent to the respective parties
as
indicated in Exhibit G. Any notice given in accordance with this Master Purchase
Agreement shall be effective upon receipt by the addressee.
11.7
Survival.
Termination of this Master Purchase Agreement for any reason shall not release
any party any party from any liabilities or obligations set forth in this
Master
Purchase Agreement which (i) the parties have expressly agreed shall survive
any
such termination or expiration, or (ij) remain to be performed or by their
nature would be intended to be applicable following any such termination
or
expiration.
11.8
Severability.
If any
provisions of this Master Purchase Agreement or the application thereof to
any
party or circumstance shall be declared unlawful, invalid or unenforceable
to
any extent, the remainder of this Master Purchase Agreement and the application
of such provisions to other party or circumstances shall not be affected
thereby, nor shall the validity and enforceability thereof be affected.
11.9
Entire
Agreement.
This
Master Purchase Agreement, including any exhibit referred to herein, and
any
POs, issued pursuant thereto, constitutes the entire agreement between the
parties with respect to the subject matter hereof. No provision of any
commercial invoice, sales invoice or other instrument used by SELLER shall
supersede the provisions of this Master Purchase Agreement, except as otherwise
agreed upon in writing by PURCHASER and SELLER.
IN
WITNESS WHEREOF, PURCHASER and SELLER have executed this Master Purchase
Agreement, as of the Effective Date.
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SELLER
( )
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By:
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Xxxxxx
Xxxxx Xxxxxxx
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By:
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Xxxxx
Xxxx
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Xxxxxx
Xxxxx Xxxxxxx
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Name:
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Xxxxx
Xxxx
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Title:
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President
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Title:
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CEO
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