MASTER SERVICES AGREEMENT
This Master Services Agreement (hereinafter referred to as the
"Agreement") is made and entered into on this the 29th day of September, 2005
(the "Effective Date"), by and between NGS TECHNOLOGIES, INC., a Delaware
corporation, and its affiliates (hereinafter referred to as "NGS") and MTEM,
LTD., a United Kingdom corporation (hereinafter referred to as the "Contractor")
sometimes referred to hereinafter collectively as "Parties" or individually as
"Party."
WHEREAS, NGS is in the business of exploration, development and production
of hydrocarbons;
WHEREAS, Contractor is the owner and holder of certain patents, licenses
and rights to multi-transient electromagnetic survey technology and is in the
business of conducting and analyzing multi-transient electromagnetic surveys for
the oil and gas industry;
WHEREAS, NGS desires to put in place an agreement with the Contractor to
provided a framework for the provision by the Contractor of surveys over oil and
gas properties using the EM Technology (as defined below) which surveys may be
conducted in combination with certain technology that may be owned in the future
by NGS or its subsidiaries;
NOW, THEREFORE, the Parties hereto, with the intent to be legally bound,
in return for good and valuable consideration, the receipt and sufficiency of
which is hereby acknowledged, including the mutual exchange of covenants and
promises herein contained, agree as follows:
1. DEFINITIONS
In this Agreement, unless the context otherwise requires, the following
terms shall have the meaning set out opposite them below:
"Affiliates" means a Party's holding company, majority owned subsidiaries, and
any majority owned subsidiaries of such holding company;
"Agreement Year" means a period of twelve (12) months commencing on the
Effective Date or any anniversary thereof;
"Contractor Group" means the Contractor and any or all agents, directors,
officers, employees, contractors or invitees of the Contractor or its
Affiliates;
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"Deliverables" means Raw Data and any multi-transient electromagnetic surveys,
reports, analyses, compilations, data, studies and other materials to be
supplied by the Contractor as specified in a Statement of Work;
"EM Technology" means MTEM's proprietary multi-transient electromagnetic survey
technology;
"Intellectual Property Rights" means all present and future intellectual
property rights of any kind whatsoever now or hereafter existing including,
without limitation, patents, registered designs, copyrights, database rights
(excluding the Raw Data collected on behalf of NGS), design rights, trademarks,
trade names, domain names and know-how, whether or not any of these is
registered or capable of registration, and all rights or forms of protection of
a similar nature or having equivalent or similar effect to any of these which
may subsist in any part of the world from time to time and any applications for
any such rights or registrations thereof;
"NGS Group" means NGS and any or all agents, directors, officers, employees,
contractors, joint owners or invitees of NGS or its Affiliates;
"Raw Data" means the individual unstacked impulse responses from each
source-receiver pair located in the electromagnetic survey as collected by
Contractor in the provision of the Services;
"Services" means the carrying out of hydrocarbon surveys over oil and gas
properties using EM Technology, including all ancillary mobilization and
demobilization relating to such surveys and the provision of data processing and
data inversion services as outlined under any Statement of Work;
"Statement of Work" means a document agreed between the Parties setting out
their detailed rights and obligations in relation to specific Services, in a
format to be agreed between the Parties from time to time.
2. SERVICES
2.1 Agreement of Services.
2.1.1 It is contemplated that from time to time during the term of this
Agreement, Contractor may be requested by NGS (through its duly authorized
representatives) to perform survey services utilizing its EM Technology anywhere
on the North American Continent. However the execution of this Agreement is not
intended nor will it be construed to obligate NGS to award any specific services
to Contractor or, to obligate the Contractor to provide any specific services to
NGS, unless as provided otherwise under this Agreement.
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2.1.2 NGS will request the Contractor to supply the Services by delivering
to Contractor an outline Statement of Work. The Parties will thereafter use best
reasonable commercial efforts to negotiate a mutually agreeable Statement of
Work within sixty (60) days from Contractor's receipt of the outline Statement
of Work, or such other period as may be agreed between the Parties.
2.1.3 The Parties shall conduct the negotiations for the Statement of Work
in good faith, except that the Contractor will not be required to agree to
perform Services as follows:
(a) at times where Contractor's resources are unavailable or pre-committed
pursuant to the terms of an existing fully executed written agreement with
a third party, provided that Contractor shall give first priority to NGS
for its next available resources or at the end of the existing commitment;
or
(b) which are for the benefit of a group in which NGS is less than a
majority owner or a majority working interest owner. In particular
Contractor will not be obliged to provide Services to NGS where NGS is
acting as a sub-contractor for any other person or entity; or
(c) where the Statement of Work requests less than fourteen (14) days of
Services, such days being consecutive where reasonably practical for NGS;
or
(d) which are beyond the scope of the usual business of Contractor.
2.1.4 In addition to its rights under section 2.1.3, the Contractor will
not be obliged to provide in excess of sixty (60) days of Services per Agreement
Year. For purposes of this paragraph, the delivery date to Contractor of a
Statement of Work proposed by NGS under Section 2.1.2, where Services are
ultimately delivered, shall be used in allocating the days of Service to any
particular Agreement Year.
2.1.5 It is specifically understood between the Parties that no
performance is required hereunder except after agreement in writing to a
Statement of Work, this Agreement serving only to establish the terms and
conditions of performance pursuant to which any future services will be
performed.
2.2 Provision of the Services.
2.2.1 Once the Parties have reached a mutually agreeable Statement of
Work, the Contractor shall commence the Services at such time as is specified in
the Statement of Work or as otherwise agreed between the Contractor and NGS. The
Parties will provide the resources specified in the Statement of Work to enable
the Contractor to provide the Services.
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2.2.2 Subject to the provisions of section 12 regarding the Contractor's
Intellectual Property Rights, all of the Deliverables shall be solely owned by
NGS upon payment in full of any sums due to the Contractor under this Agreement
as set forth in the applicable Statement of Work.
2.2.3 NGS will be responsible for providing the necessary permissions and
access to land, materials, resources, facilities and, where applicable,
personnel as specified in the Statement of Work to facilitate the provision of
the Services by the Contractor. In addition, NGS acknowledge the reliance placed
by the Contractor on the information contained in the Statement of Work relating
to the site where the Services are to be performed, and consequently NGS
warrants that such information is accurate to the best of NGS's knowledge and
belief.
2.2.4 Once agreed, should either Party wish to alter any provision in the
Statement of Work, the Parties will negotiate in good faith with a view to
agreeing any appropriate alteration to costs, Deliverables or milestones. In the
absence of any agreement, the Parties will continue to comply with their
obligations as specified in the agreed Statement of Work.
2.2.5 Notwithstanding anything agreed in the Statement of Work, the
Contractor will be entitled to refuse to supply the Services in any area which
it reasonably deems to be hazardous or unsafe.
2.2.6 NGS and Contractor shall each appoint and maintain a competent
representative (hereinafter, a "Superintendent") to act on its behalf. The
Superintendent shall be authorized to act on behalf of NGS and Contractor
respectively in all matters concerning the Services and administration of this
Agreement. Superintendents shall be available for consultation at all reasonable
times, and all oral/or written communication shall be between these
representatives. Should a Party's Superintendent prejudice the proper and
efficient performance of the Services, the other Party may request his removal
and upon good cause shown, the Superintendent shall be removed and replaced as
soon as is reasonably practicable.
Any suggestions or directions given by the NGS Superintendent shall be
given only to the Superintendent or other person in charge of Contractor's
Group.
3. COMPENSATION
3.1 Basis of Payment. NGS shall pay for the Services an amount specified
on Exhibit B attached hereto and incorporated by reference.
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3.2 Invoicing.
3.2.1 Contractor shall be entitled to submit invoices to NGS as provided
for in each Statement of Work and shall, except in relation to any agreed
milestone payments, use commercially reasonable efforts to include detailed
itemization and documentation of all Contractor Costs as defined in Exhibit "B".
A copy of all supporting documentation shall be provided to NGS with each
invoice submitted.
3.2.2 Payment of all invoices hereunder shall be due within thirty (30)
days of the receipt of such invoice, such payment to be made in the currency and
to the bank account specified in the Statement of Work. NGS shall not be
required to pay any specific portion of an invoice which it disputes or which
does not include detailed itemization and supporting documentation for all
Contractor Costs. NGS will provide the Contractor with the items and reasons for
dispute promptly in writing. Additionally, NGS shall not be required to pay any
specific portion of an invoice if NGS has a bona fide disagreement as to the
appropriateness of that portion of the invoice in question, and, NGS will
provide the Contractor with the items and reasons for dispute promptly in
writing. Contractor will use reasonable commercial efforts to provide NGS with
information required to resolve any dispute. However, NGS agrees that should any
portion of an invoice be disputed, NGS shall pay the non-disputed portion in
accordance with the Statement of Work.
3.2.3 Any amounts set out in the Statement of Work are exclusive of any
applicable local sales taxes (applicable in the state or country in which the
Services are conducted), which will be payable in addition by NGS. NGS shall not
be responsible for the payment of any direct or indirect value-added tax,
foreign country-imposed tax and any withholding taxes, duties, imports or any
similar tax.
3.2.4 Without prejudice to any other remedies of the Contractor, in the
event that any amount due hereunder is not paid on the due date, Contractor may
charge NGS interest (both before and after any judgment) on the amount unpaid,
at the rate of 3% per annum above the Xxxxx Fargo base rate from time to time
until payment in full is made, or, at the Contractor's option, suspend the
provision of the Services. This clause 3.2.4 does not apply to those invoice
amounts that NGS has disputed in accordance with section 3.2.2 above.
3.2.5 The Contractor may invoice for 100% of Contractor Costs where the
Contractor is prevented from providing the Services in whole or in part for any
period as a result of:
(a) any local statutory public holidays; or
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(b) any acts or omissions of the NGS Group or any sub-contractor of the
NGS Group; or
(c) any extreme weather conditions as agreed between the Party
representatives; or
(d) an event of Force Majeure (as define in section 10 below).
3.2.6 The Contractor will not invoice NGS for any Contractor Costs
incurred where the Contractor is prevented from providing the Services in whole
or in part for any period as a result of:
(a) any acts or omissions of the Contractor or any sub-contractor of the
Contractor; or
(d) any lack or failure of equipment or other facilities to be provided by
the Contractor.
3.3 NGS shall not refuse to accept Deliverables in order to defer payment
of any invoice.
3.4 Notwithstanding the foregoing provisions of this section, the
Contractor shall have the right to negotiate a mutually agreeable rate for
Services if;
3.4.1 any of the Services are provided on oil and gas properties or
projects where NGS does not own a majority interest; or
3.4.2 the Contractor agrees to provide Services in excess of sixty (60)
days per Agreement Year, but only with respect to that portion of Services that
exceed sixty days in such period.
4. TERM
This Agreement shall be for an initial term of five (5) years commencing
on the Effective Date, and may be extend for an additional five (5) year period
upon the mutual written agreement of the Parties. In order to facilitate any
extension of this Agreement beyond the initial term, the Parties will meet at
least three months prior to the end of the initial term to discuss the
appropriate commercial provisions relative to any extension.
5. INDEPENDENT CONTRACTOR
It is expressly understood and agreed that the relationship created by
this Agreement is that of the principal and independent contractor and not that
of principal and agent, master and servant, or employer and employee. Neither
Party nor its employees shall be deemed to be the employees of the other Party.
NGS shall designate the services and the ultimate results to be obtained, but
shall leave to Contractor the methods and details of performance, NGS being
interested only in the results obtained, and having no control over the manner
and methods of performance.
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As an independent contractor, Contractor agrees to comply with all laws,
rules, and regulations, whether federal, state or municipal, which now or in the
future may be applicable to all service or work performed hereunder or
applicable to Contractor's business, equipment, or employees engaged in or in
any manner connected with its performance hereunder.
In all cases where Contractor's employees (defined to include Contractor's
direct, borrowed, special or statutory employees) are covered by the Louisiana
Workers' Compensation Act, La. R.S. 23:1021 et seq., NGS and Contractor agree
that all services, work, and operations performed by Contractor and its
employees pursuant to this Agreement are an integral part of and are essential
to the ability of NGS to generate NGS' goods, products and services for purposes
of La.R.S. 23:1061 (A)(1). Furthermore, NGS and Contractor agree that NGS is the
statutory employer or special employer (as defined in La.R.S. 23:1031(c)) of
Contractor's employees. Contractor shall remain primarily responsible for the
payment of Louisiana Worker's Compensation benefits to its employees, and shall
not be entitled to seek contribution or indemnity for any such payments from
NGS. Contractor agrees that its worker's compensation insurance policy shall be
endorsed to designate NGS as an alternative employer and as a principal and
statutory employer or borrowing employer and shall be further endorsed to waive
unconditionally those underwriter's or insurer's rights of subrogation against
NGS.
6. INSURANCE
The Contractor agrees to procure and maintain at its sole cost and
expense, policies of insurance in the minimum amounts outlined on that certain
document identified as "Insurance Requirements for Contractor Services,"
attached hereto as Exhibit "A". Contractor will furnish to NGS certificates of
insurance evidencing the fact that proper insurance has been secured and no work
shall be commenced unless the certificates are on file with NGS. MTEM will
provide at least thirty (30) days prior written notice to NGS if the policies
are changed or cancelled.
7. WARRANTIES
7.1 Warranties. Contractor represents and warrants that the Services shall
be performed in accordance with the Statement of Work, in a good and workmanlike
manner, and that all of Contractor Group's personnel and equipment shall be
fully qualified and fit for their respective assignments, in accordance with
good industry practice and custom.
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7.2 LIMITATIONS OF WARRANTIES REGARDING THE DELIVERABLES.
7.2.1 EXCEPT AS SET FORTH IN SECTION 7.1, NO WARRANTIES ARE GIVEN BY THE
CONTRACTOR IN RELATION TO THE SERVICES OR THE USE TO WHICH THE DELIVERABLES MAY
BE PUT. IN PARTICULAR, NGS AGREES THAT THE CONTRACTOR WILL HAVE NO LIABILITY OR
RESPONSIBILITY FOR ANY DECISION TAKEN BASED UPON ANY DELIVERABLE, AND THAT
NOTHING CONTAINED IN ANY DELIVERABLE SHOULD BE TAKEN TO IMPLY ANY RECOMMENDATION
OR ENDORSEMENT OF THE CONTRACTOR TO ANY PARTICULAR COURSE OF ACTION.
7.2.2 TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAWS, THE CONTRACTOR
DISCLAIMS ALL IMPLIED REPRESENTATIONS, WARRANTIES, CONDITIONS, OBLIGATIONS OR
DUTIES OF EVERY NATURE (INCLUDING, WITHOUT LIMITATION, ANY EQUITABLE, COMMON LAW
OR STATUTORY WARRANTIES OF FITNESS FOR A PARTICULAR PURPOSE, MERCHANTABILITY
AND/OR SATISFACTORINESS) IN RESPECT OF THE SERVICES AND ANY DELIVERABLE.
ACCORDINGLY, ALL SUCH IMPLIED REPRESENTATIONS, WARRANTIES, CONDITIONS,
OBLIGATIONS OR DUTIES ARE EXCLUDED TO THE FULLEST EXTENT PERMITTED BY APPLICABLE
LAWS.
7.2.3 CONTRACTOR SHALL NOT BE LIABLE FOR ANY CONSEQUENTIAL OR INDIRECT LOSS
OR LOSS OF PROFIT, BUSINESS, DATA, REVENUE, GOODWILL OR ANTICIPATED SAVINGS WHICH
ARISES OUT OF OR IN CONNECTION WITH THIS AGREEMENT.
7.3 LIMITS OF LIABILITY REGARDING THE DELIVERABLES
TO THE CONTRARY NOTWITHSTANDING, CONTRACTOR'S AGGREGATE LIABILITY ARISING
FROM SECTIONS 7.1 AND 7.2 SHALL NOT EXCEED 1) THE SUMS PAID AND DUE TO BE PAID
UNDER THE STATEMENT OF WORK FOR THE SERVICES OR DELIVERABLES IN QUESTION AS AT
THE DATE OF THE MATTER GIVING RISE TO THE CLAIM, OR 2) AMOUNTS WHICH BY LAW MAY
NOT BE LIMITED OR EXCLUDED.
7.4 NOTHING IN THIS AGREEMENT LIMITS OR EXCLUDES THE LIABILITY OF THE
CONTRACTOR UNDER ANY INDEMNITY OR OTHER LIABILITY IN THIS AGREEMENT, INCLUDING
FOR DEATH, PERSONAL INJURY OR PROPERTY DAMAGE UNDERTAKEN BY CONTRACTOR, OR IN
RELATION TO ANY MATTER WHICH BY LAW MAY NOT BE LIMITED OR EXCLUDED.
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8. INDEMNIFICATION
8.1 Notice of Indemnities. CONTRACTOR AND NGS AGREE THAT THIS STATEMENT
COMPLIES WITH THE REQUIREMENT KNOWN AS THE EXPRESS NEGLIGENCE RULE TO EXPRESSLY
STATE IN A CONSPICUOUS MANNER TO AFFORD FAIR AND ADEQUATE NOTICE THAT THIS
AGREEMENT HAS PROVISIONS REGARDING NEGLIGENCE, STRICT LIABILITY OR OTHER FAULT.
BOTH PARTIES REPRESENT TO EACH OTHER (1) THAT THEY HAVE CONSULTED AN ATTORNEY
CONCERNING THIS AGREEMENT OR, IF THEY HAVE NOT CONSULTED AN ATTORNEY, THAT THEY
HAD THE ABILITY TO SO CONSULT, BUT MADE AN INFORMED DECISION NOT TO DO SO, AND
(2) THAT THEY FULLY UNDERSTAND THEIR RIGHTS AND OBLIGATIONS UNDER THIS
AGREEMENT.
8.2 SPECIFIC INDEMNITIES
8.2.1 CONTRACTOR AGREES TO AND SHALL FULLY DEFEND, PROTECT, INDEMNIFY,
HOLD HARMLESS, AND RENDER WHOLE THE NGS GROUP, FROM AND AGAINST EACH AND EVERY
CLAIM, DEMAND, OR CAUSE OF ACTION, AND ANY LIABILITY, COST OR EXPENSE,
INCLUDING, BUT NOT LIMITED TO REASONABLE ATTORNEY'S FEES AND EXPENSES INCURRED
IN THE DEFENSE OF THE NGS GROUP, IN CONNECTION WITH SUCH CLAIM, DEMAND OR CAUSE
OF ACTION WHICH MAY BE MADE OR ASSERTED BY OR ON BEHALF OF CONTRACTOR'S GROUP,
ON ACCOUNT OF PERSONAL INJURY, BODILY INJURY, OR DEATH, OR PROPERTY DAMAGE
CAUSED BY, ARISING OUT OF, OR IN ANY WAY INCIDENTAL OR ATTRIBUTABLE TO OR IN
CONNECTION WITH THE PERFORMANCE OF THIS AGREEMENT AND THE SERVICES. THIS
INDEMNITY SHALL NOT APPLY IF DAMAGE IS CAUSED, OR ALLEGED TO BE CAUSED, BY THE
GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF THE NGS GROUP. NGS SHALL NOTIFY
CONTRACTOR IMMEDIATELY OF ANY CLAIM, DEMAND, OR SUIT THAT MAY BE PRESENTED TO IT
BY ANY MEMBER OF THE CONTRACTOR GROUP, AFFORDING THE CONTRACTOR A FULL
OPPORTUNITY TO ASSUME THE DEFENSE OF SUCH CLAIM, DEMAND, OR SUIT, AND TO PROTECT
NGS AND CONTRACTOR UNDER THE OBLIGATIONS OF THIS SECTION.
8.2.2 NGS AGREES TO AND SHALL FULLY DEFEND, PROTECT, INDEMNIFY, HOLD
HARMLESS, AND RENDER WHOLE THE CONTRACTOR GROUP FROM AND AGAINST EACH AND EVERY
CLAIM, DEMAND, OR CAUSE OF ACTION, AND ANY LIABILITY, COST OR EXPENSE,
INCLUDING, BUT NOT LIMITED TO REASONABLE ATTORNEY'S FEES AND EXPENSES INCURRED
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IN THE DEFENSE OF THE CONTRACTOR GROUP, IN CONNECTION WITH SUCH CLAIM, DEMAND OR
CAUSE OF ACTION WHICH MAY BE MADE OR ASSERTED BY OR ON BEHALF OF THE NGS GROUP,
ON ACCOUNT OF PERSONAL INJURY, BODILY INJURY, OR DEATH, OR PROPERTY DAMAGE
CAUSED BY, ARISING OUT OF, OR IN ANY WAY INCIDENTAL OR ATTRIBUTABLE TO OR IN
CONNECTION WITH THE PERFORMANCE OF THIS AGREEMENT AND THE SERVICES PERFORMED
UNDER SAID AGREEMENT. THIS INDEMNITY SHALL NOT APPLY IF THE DAMAGE CAUSED, OR
ALLEGED TO BE CAUSED BY THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF THE
CONTRACTOR GROUP. CONTRACTOR SHALL NOTIFY NGS IMMEDIATELY OF ANY CLAIM, DEMAND,
OR SUIT THAT MAY BE PRESENTED TO IT BY THE NGS GROUP, AFFORDING NGS FULL
OPPORTUNITY TO ASSUME THE DEFENSE OF SUCH CLAIM, DEMAND, OR SUIT, AND TO PROTECT
CONTRACTOR AND NGS UNDER THE OBLIGATIONS OF THIS SECTION.
8.2.3 THE OBLIGATIONS TO RELEASE, TO DEFEND, AND TO INDEMNIFY CONTAINED IN
SECTIONS 8.2.1, 8.2.2 AND 8.24 SHALL APPLY EVEN IF CAUSED, IN WHOLE OR IN PART,
BY THE JOINT, SOLE, OR CONCURRENT NEGLIGENCE, STRICT LIABILITY, OR OTHER FAULT,
WHETHER PASSIVE OR ACTIVE, OF ANY PERSON OR ENTITY, INCLUDING BUT NOT LIMITED TO
THE INDEMNIFIED PARTIES.
8.2.4. CONTRACTOR AGREES TO PROTECT, DEFEND, INDEMNIFY AND HOLD HARMLESS
AND RELEASE NGS AND THE NGS GROUP FROM AND AGAINST ANY MANNER OF LOSS,
LIABILITY, CLAIM, DAMAGE, PENALTY OR COST (INCLUDING, BUT NOT LIMITED TO,
REASONABLE ATTORNEYS' FEES) ARISING OUT OF OR RELATED TO ANY INJURY OR DEATH OR
DAMAGE TO THE PROPERTY OF ANY THIRD PARTY WHICH IS INCURRED UNDER THE
PERFORMANCE OF THIS AGREEMENT. NGS AGREES TO PROTECT, DEFEND, INDEMNIFY AND HOLD
HARMLESS AND RELEASE CONTRACTOR FROM AND AGAINST ANY MANNER OF LOSS, LIABILITY,
CLAIM, DAMAGE, PENALTY OR COST (INCLUDING, BUT NOT LIMITED TO, REASONABLE
ATTORNEYS' FEES) ARISING OUT OF OR RELATED TO ANY INJURY OR DEATH OR DAMAGE TO
THE PROPERTY OF ANY THIRD PARTY WHICH IS INCURRED DURING THE PERFORMANCE OF THIS
AGREEMENT AND WHICH IS SOLELY DUE TO THE ACTIONS OF THE NGS GROUP. AS USED
HEREIN, "THIRD PARTY" MEANS ANY PERSON OR ENTITY NOT A MEMBER OF THE RELEVANT
GROUP.
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8.2.5 NGS AGREES TO PROTECT, DEFEND, INDEMNIFY, HOLD HARMLESS AND RELEASE
THE CONTRACTOR GROUP, FROM AND AGAINST ANY MANNER OF LOSS, LIABILITY, CLAIM,
DAMAGE, PENALTY OR COST (INCLUDING, BUT NOT LIMITED TO, REASONABLE ATTORNEYS'
FEES) ARISING OUT OF OR RELATED TO ANY USE OF THE DELIVERABLES BY NGS OR ANY
PARTY AUTHORIZED TO USE THEM BY NGS.
9. SUBCONTRACTING.
Either Party may sub-contract the provision of all or any part of its
obligations under this Agreement. In such case, or if either Party contracts for
the furnishing of any services or material required to be furnished by a
sub-contractor, then such contracts will contain releases of liability for
damage to property of such subcontractor, insurance requirements, and a hold
harmless provision at least equivalent to the terms set out in this Agreement.
Either Party shall be responsible for all acts or omissions of its
sub-contractors.
10. FORCE MAJEURE.
Except for the duty to make payments hereunder when due, indemnification,
and confidentiality provisions under the Agreement, any delay or failure by
either Party in performing an obligation under this Agreement caused by an event
of Force Majeure will not be deemed to be a breach of or failure to perform
under this Agreement. Each Party will use commercially reasonable efforts to
resume performance as soon as practicable, although neither Contractor nor
sub-contractor will be required against its will to adjust any labor or similar
disputes except in accordance with applicable law. For the purposes of this
Agreement, an event of "Force Majeure" shall be a defined as an act of God,
action of the elements (including without limitation inclement weather), warlike
action, insurrection, revolution or civil strife, piracy, civil war or hostile
action, strikes, differences with workers, acts of public enemies, federal or
state laws, rules and regulations of any governmental authorities having
jurisdiction in the premises or of any other group, organization of informal
association (whether or not formally recognized as a government); or any other
causes (except financial) beyond the control of either Party.
11. CONFIDENTIALITY
11.1. Each Party ("Receiving Party") agrees that it shall not disclose to
any third party any Confidential Information (as hereinafter defined) concerning
the trade secrets, methods, processes, technology, or procedures or any other
confidential and proprietary information of the other Party which it learns
during the course of its performance of this Agreement or which is disclosed to
it by the other Party ("Disclosing Party"), without the prior written consent of
such Disclosing Party.
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11.2 The Receiving Party may disclose or use the Confidential Information
without prior written consent of the Disclosing Party only to the extent
such information is:
11.2.1 already known to the Receiving Party as of the date of disclosure
hereunder; or
11.2.2 already in possession of the public or becomes available to the
public other than through the act or omission of the Receiving Party in
breach hereof; or
11.2.3 required to be disclosed under applicable law or by a governmental
order, decree, regulation or rule (provided that the Receiving Party shall
give written notice to the Disclosing Party prior to such disclosure); or
11.2.4 is acquired independently from a third party that, to the knowledge
of the Receiving Party, has the right to disseminate such information at
the time it is acquired by the Receiving Party; or
11.2.5 is otherwise independently developed by the Receiving Party without
any use of any of the Confidential Information of the Disclosing Party.
11.3 The Receiving Party shall be entitled to disclose Confidential
Information without the Disclosing Party's prior written consent to the
following persons (the "Representatives"), to the extent the
Representatives need to know such Confidential Information for the purpose
of assisting the Receiving Party with the evaluation of the Transaction,
are informed of the confidential nature of the Confidential Information
and agree to be bound by the terms of this Agreement:
(i) employees, officers and directors of the Receiving Party; or
(ii) the Receiving Party's Affiliates and the employees, officers
and directors of such Affiliates; or
(ii) any professional consultant, advisor or agent retained by the
Receiving Party in connection with the provision or receipt of
the Services, provided such is not a competitor of the
Disclosing Party.
11.4 The Receiving Party shall be responsible for ensuring that all of its
Representatives to whom the Confidential Information is disclosed under
this Agreement shall keep such information confidential in accordance with
the terms of this Agreement and shall not disclose, divulge or use such
Confidential Information in violation of this Agreement. The Receiving
Party shall be responsible to the Disclosing Party for any breach of this
Agreement by the Representatives of the Receiving Party.
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11.5 The Confidential Information shall remain the property of the
Disclosing Party, and, subject to the provisions of section 15.1.2, the
Disclosing Party may demand the return thereof at any time upon giving
written notice to the Receiving Party. Promptly after receipt of such
notice, the Receiving Party shall return all of the original Confidential
Information and copies thereof (both written and electronic) in its
possession and in the possession of Representatives to whom it was
disclosed pursuant to the terms hereof.
11.6 If the Receiving Party becomes legally compelled to disclose any of
the Confidential Information, the Receiving Party will provide the
Disclosing Party with prompt notice so that the Disclosing Party may seek
a protective order or other appropriate remedy. If such protective order
or other remedy is not obtained, the Receiving Party will furnish only
that portion of the Confidential Information which is legally required,
and the Receiving Party will cooperate with the Disclosing Party's counsel
at the Disclosing Party's cost to enable the Disclosing Party to obtain a
protective order or other reliable assurance that confidential treatment
will be accorded the same.
"Confidential Information" shall be defined as all information furnished by the
Disclosing Party or any Person (as hereinafter defined) acting with the
Disclosing Party or on its behalf, including without limitation, partners,
employees, agents, representatives, attorneys, accountants, and consultants
(collectively, "Disclosing Party's Representatives"), to the Receiving Party or
any Person (as defined below) acting on Receiving Party's behalf (collectively,
"Receiving Party's Representatives"), including without limitation, any
Deliverable to the extent only that it contains or is based on any such
furnished information or reflecting Contractor's review or evaluation of any
information furnished by NGS or any Person acting with NGS or on its behalf. The
term "Person" as used in this Agreement shall be interpreted broadly to include,
without limitation, any corporation, company, entity, trust, group, partnership
or individual. Notwithstanding the above, the obligation of confidentiality in
regards to the Deliverables shall apply only to Contractor Group provided that
the disclosure does not include any direct information as to the Contractor's
Intellectual Property Rights.
Subject to the approval by NGS, this confidentiality obligation will
survive the expiration or termination of this Agreement for five (5) years after
such expiration or termination, provided that the Contractor may not disclose
any portion of the Deliverables, as defined under Confidential Information,
after such expiration or termination without the express written consent of NGS.
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Except as to disclosures required by law or regulation, neither Party
shall make any press announcements or otherwise publish any matter connected
with this Agreement without the prior written consent of the other Party, which
approval shall not be unreasonably withheld.
12. INTELLECTUAL PROPERTY
12.1 The Parties acknowledge that, except in relation to any specific
rights granted to NGS to make use of and disclose the Deliverables, no rights or
licenses are granted by this Agreement. In particular, no rights or licenses are
granted by this Agreement in or to the EM Technology or any other Intellectual
Property Rights owned or licensed by the Contractor, and all such rights shall
remain owned by the Contractor or its licensors.
12.2 Any other provision in this Agreement to the contrary
notwithstanding, and in addition to all other indemnity provisions herein,
Contractor represents and warrants that the use or construction of any and all
tools, technology and equipment furnished by Contractor and used in the work
provided for herein does not infringe on any third party intellectual property
rights, and Contractor agrees to indemnify and hold the NGS Group harmless from
any and all claims, demands, and causes of action of every kind and character in
favor of or made by a patentee, licensee, or claimant of any rights or priority
to such tool, technology or equipment, or the use or construction thereof, that
may result from or arise out of furnishing or use of any such tool, technology
or equipment by Contractor in connection with the work, provided that the
Contractor is given immediate and complete control of such claims. The
Contractor shall have the right to replace or change all or any part of the
intellectual property in order to avoid any infringement.
12.3 NGS agrees that the Contractor shall have the sole right to defend
any such claims and make settlements thereof at its own discretion, subject to
such settlement not adversely impacting NGS.
12.4 In the event that any such infringement occurs or may occur, the
Contractor may at its sole option and expense:
12.4.1 Modify or amend the intellectual property or infringing tool so
that the same becomes non-infringing; or
12.4.2 Replace the intellectual property or infringing tool by other
intellectual property of similar capability; or
12.4.3 Repay NGS all amounts received under this Agreement.
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13. DISPUTE RESOLUTION
Except as provided herein, no civil action with respect to any dispute,
claim or controversy arising out of relating to this Agreement may be commenced
until this matter has been submitted to non-binding mediation at the American
Arbitration Association ("AAA"). The Parties will attempt to resolve any dispute
or claim arising out of or relating to this Agreement promptly through direct
negotiations. If the matter is not resolved within fourteen (14) days through
negotiation, either Party may commence mediation by providing to the AAA and the
other Party, a request for mediation, setting forth the subject matter of the
dispute, the specific details of the dispute, and the relief requested. The
Parties will mutually cooperate with AAA and with one another to select a
mediator from AAAs panel of neutral mediators and in scheduling the mediation
proceedings. The Parties stipulate and agree that they will participate in
mediation in good faith and that they will share equally in all costs relating
to the mediation, excluding each Party's own costs and expenses. All offers,
promises, conduct and statements, whether oral or written, made in the course of
the mediation by any of the Parties, their agents, employees, experts and
attorneys, and by the mediator and any AAA employee, are confidential,
privileged, and inadmissible for any purposes including impeachment in any
litigation or other proceeding involving the Parties, provided that the evidence
that is otherwise admissible or discoverable shall not be rendered inadmissible
or non-discoverable as a result of its use in the mediation. Any Party may seek
equitable relief prior to the mediation to preserve the status quo only, pending
the completion of the mediation process. Except for such an action to obtain
equitable relief, neither party may commence a civil action with respect to the
matter submitted to mediation until after the completion of the initial
mediation session, or forty-five (45) days after the date of filing the written
request for mediation, whichever occurs first. Mediation may continue after the
commencement of a civil action, if the parties so desire. The provisions of this
section may be enforced by any court of competent jurisdiction and the parties
seeking enforcement shall be entitled to an award of all costs, fees and
expenses, including attorney's fees to be paid by the party against whom
enforcement is ordered.
14. TERMINATION
14.1 Either party shall be entitled immediately to terminate this
Agreement and/or any Statement of Work by written notice to the other if:
14.1.1 that other Party commits any material breach of the provisions of
this Agreement and fails to cure any material breach within twenty one (21) days
after receipt of a written notice giving full particulars of the material
breach. For the avoidance of doubt, any failure to pay any invoice or expense
identified in a Statement of Work when due will be a material breach of this
Agreement unless such failure to pay is due to a bona fide dispute as to the
invoice or expense as provided in clause 3.2.2; or
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14.1.2 an administrator, receiver, administrative receiver, supervisor or
similar official is appointed over any of the property or assets of that other
Party; or
14.1.3 the other Party makes any voluntary arrangement with its creditors
or becomes subject to an administration order or becomes or is declared
bankrupt; or
14.1.4 the other Party goes into liquidation (except for the purposes of
amalgamation or reconstruction and in such manner that the solvent company
resulting therefrom effectively agrees to be bound by or assumes the obligations
imposed on that other Party under this Agreement); or
14.1.5 the other Party suffers any analogous proceedings to those set out
in sections 14.1.2 to 14.1.4 above
14.2 The Contractor may terminate this Agreement if:
14.2.1 NGS has not submitted a bona fide SOW for utilization of the
Services of the Contractor at least once within the consecutive eighteen (18)
month period from the Effective Date, unless the failure to utilize the
Contractor's services hereunder is the result of the actions or inactions of the
Contractor in material breach of this Agreement or an event of Force Majeure.
15. CONSEQUENCES OF EXPIRATION OR TERMINATION
15.1 Upon expiration or termination of a Statement of Work or this
Agreement howsoever caused:
15.1.1 the Contractor will cease to provide the Services under the
Statement of Work or Agreement (as appropriate);
15.1.2 each Party will cease use of any Confidential Information belonging
to the other which has been provided or obtained in relation to the terminated
Services, and shall return or destroy on request such of the original versions
of any such Confidential Information and copies thereof that are in its
possession
15.1.3 all sums accrued to the date of termination and due to be paid to
the Contractor relative to the Statement of Work or Agreement (as appropriate)
shall become immediately payable by NGS, except those charge that are the
subject of a bona fide dispute under clause 3.2.2.
15.2 Expiration or termination of a Statement of Work or this Agreement shall be
without prejudice to any accrued rights or liabilities of the parties and to the
continuation in force of all provisions which are expressed to or by implication
remain in force following expiration or termination or which would be intended
by the parties to continue beyond expiration or termination.
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15.3 The following sections will survive expiration or termination of this
Agreement: 5, 7, 8, 11-16, 19, 21-24 and 26-28.
16. GOVERNING LAW
16.1 This Agreement and the legal relations among the Parties hereto shall be
governed by and construed in accordance with the substantive laws of the State
of Texas.
16.2 Contractor and NGS each agree to comply with all laws, rules and
regulations, Federal, state and municipal, which are now or may become
applicable to operations covered by this Agreement or arising out of the
performance of the Services.
16.3 If any provision of this Agreement is inconsistent with or contrary to any
applicable Federal, state or municipal law, rule or regulation, said provision
will be deemed to be modified to the extent required to comply with said law,
rule or regulation, and as so modified, said provision and this Agreement shall
continue in full force and effect.
16.4 SUBJECT TO SECTION 13, IT IS SPECIFICALLY UNDERSTOOD AND AGREED THAT ANY
SUIT OR PROCEEDING HEREUNDER SHALL BE BROUGHT EXCLUSIVELY IN THE STATE AND
FEDERAL COURTS LOCATED IN XXXXXX COUNTY, TEXAS. EACH PARTY CONSENTS TO THE
PERSONAL JURISDICTION OF THE TEXAS STATE AND FEDERAL COURTS AND WAIVES ANY
OBJECTION THAT SUCH COURTS ARE AN INCONVENIENT FORUM.
17. ASSIGNMENT
Neither Party may assign this agreement nor its rights or obligations
under this Agreement nor novate this Agreement without the prior written consent
of the other Party, not to be unreasonably withheld or delayed, provided that
either Party may assign or novate this Agreement without the need for consent to
a wholly-owned subsidiary of that Party, on giving the other Party written
notice to this effect.
18. COOPERATION IN MARKETING.
Subject to the prior written consent of NGS, not to be unreasonably
withheld, Contractor may utilize that portion of the Deliverables from the first
Statement of Work that lies solely and completely on oil and gas property in
which NGS owns a majority of the interest in the marketing of its
multi-transient electromagnetic survey technology. For clarity, Contractor may
not utilize any Deliverable that covers any property or depth that is not owned
by NGS. NGS shall reasonably cooperate in such efforts by providing references
and the disclosure of the Parties' participation in the Services.
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19. LIENS
Each Party will promptly pay any and all amounts owing by it for taxes,
licenses, fees levied or assessed and for work performed, services rendered or
materials furnished in connection with this Agreement so that no such claim or
lien will ever attach, or be permitted to attach, to the other Party's property,
whether real or personal, and each Party hereby indemnifies the other Party
against any and all such claims and liens. Notwithstanding the words of this
section, or any other section of this Agreement to the contrary, Contractor
retains any and all rights and does not waive any rights to collect the amounts
owed Contractor by NGS, including the right to file, perfect or continue a lien
for work performed by Contractor under this Agreement.
20. AUTHORITY
Each Party has all requisite power and authority to execute, deliver and
perform this Agreement. All necessary corporate proceedings of each Party have
been taken to authorize the execution, delivery and performance of this
Agreement. This Agreement has been duly authorized, executed and delivered by
each Party, constitutes the legal, valid and binding obligation of each Party,
and is enforceable in accordance with its terms. Except as set forth elsewhere
herein, no consent, authorization, approval, order, license, certificate, or
permit of or from, or declaration or filing with, any federal, state, local or
other governmental authority or any court or other tribunal is required by
either Party for the execution, delivery or performance of this Agreement. No
consent of any Party to any contract, agreement, instrument, lease, arrangement
or understanding to which either Party is a signer, or to which any of its
properties or assets is subject, is required for the execution, delivery or
performance of this Agreement
21. FURTHER ASSURANCES
The Parties agree to execute and deliver any and all other mutually
acceptable instruments and/or documents reasonably necessary to accomplish the
transaction contemplated hereby. Each Party hereto shall from time to time at
the cost of the other Party do and perform such further acts and execute and
deliver such further instruments and documents as may be required or reasonably
requested by other Party to carry out and effect the intentions and purposes of
this Agreement.
22. LEGAL REVIEW
The Parties acknowledge that they have had an adequate opportunity to
review each and every provision contained in this Agreement, including the
opportunity to submit the same to legal counsel for review and comment. Based on
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said review and consultation, the Parties agree with each and every term
contained in the Agreement. Based on the foregoing, the Parties agree that the
rule of construction that a contract be construed against the drafter, if any,
shall not be applied in the interpretation and construction of this Agreement.
23. NOTICES
Any notice or other communication required or permitted to be given
hereunder shall be in writing and shall be mailed by certified mail, return
receipt requested, or by Federal Express or similar overnight delivery or
courier service or delivered in person against receipt to the Party to whom it
is to be given at the address of such Party set forth below. Notices hereunder
shall be deemed delivered upon receipt.
NGS: 000 Xxxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
Facsimile: 713-935-0199
Attention: Company President
Contractor: 00 Xxxxxxxx
Xxxxxxxxx, Xxxxxxxx XX0 0XX
Facsimile: x00 000 000 0000
Attention: Company Secretary
Any Party may give written notice of a change in the address or individual to
whom delivery shall be made provided such notice is given at least ten (10)
business days prior to becoming effective
24. NON SOLICITATION
Neither Party shall, during the period of the Agreement or for twelve
(12) months after its expiration or termination for whatever reason, employ,
solicit or endeavour to entice away from any person who is, or has been during
the said period, an officer, director, employee or contractor ("Personnel") of
the other party and who is or has been engaged in the provision or receipt of
the Services.
25. ENTIRETY
This Agreement, together with the exhibit identified herein and attached
hereto, embodies the entire agreement between the Parties, superseding, all
prior agreements, negotiations, letters of intent, arrangements and
understandings related to the subject matter hereof either written or oral, and
may only be supplemented, altered, amended, modified, or revoked by a writing
signed by duly authorized representatives of the Parties. Notwithstanding the
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provisions of this paragraph, no Party shall be bound by, subject to, or deemed
a Party to, any agreement between the Parties which have not been duly executed
by, or on behalf of, such Party.
26. WAIVER AND PRECEDENCE
Any of the terms, provisions, covenants, representations, warranties or
conditions hereof may be waived only by a written instrument executed by the
Party waiving compliance. Except as otherwise expressly provided in this
Agreement, the failure of any Party at any time or times to require performance
of any provision hereof shall in no manner affect such Party's right to enforce
the same.
In the event of any conflict between the terms of this Agreement and a Statement
of Work, the terms of this Agreement will prevail, other than where the
Statement of Work expressly references a section of this Agreement and states
that it is not to be disapplied or is amended by the provisions of the Statement
of Work.
27. BINDING EFFECT
All the terms, provisions, covenants, obligations, indemnities,
representations, warranties and conditions of this Agreement shall be binding
upon and inure to the benefit of and be enforceable by the Parties hereto and
their respective successors and permitted assigns. Any permitted assignment of
the Parties' rights hereunder to any third party shall be made expressly subject
to all of the terms, provisions, covenants, obligations, indemnities,
representations, warranties and conditions of this Agreement.
28. SEVERABILITY
If any provision of this Agreement is invalid, illegal or unenforceable,
the balance of this Agreement shall remain in effect, and if any provision is
inapplicable to any person or circumstance, it shall nevertheless remain
applicable to all other persons and circumstances.
29. HEADINGS
The headings in this Agreement are solely for convenience of reference and
shall be given no effect in the construction or interpretation of this
Agreement.
30. COUNTERPARTS
This Agreement may be executed in any number of counterparts, each of
which shall be deemed an original, but all of which together shall constitute
one and the same instrument.
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IN WITNESS WHEREOF, this Agreement has been approved and executed by the
duly authorized officer of each Party, all as of the date first above written
and shall be effective as of the Effective Date .
NGS Technologies, Inc. MTEM, Ltd.
By: ______________________ By: ______________________
Xxxxxx X. Xxxxxx, Xxxx Xxxxxx,
Chief Executive Officer Chief Executive Officer
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EXHIBIT "A"
Attached to and made a part of that certain
Master Service Agreement
Dated September 29, 2005, by and between
NGS Technologies, Inc.
and MTEM, Ltd.
INSURANCE REQUIREMENTS FOR ALL
CONTRACTOR SERVICES
Minimum Insurance Coverage to be Maintained by Contractor
1. EMPLOYER'S LIABILITY
INSURER Chubb
POLICY NUMBER 35772536
LIMIT OF LIABILITY (pound)10,000,000
2. PRIMARY PUBLIC/PRODUCTS LIABILITY
INSURER Chubb
POLICY NUMBER 35772536
LIMIT OF LIABILITY (pound)5,000,000 any one occurrence unlimited in
the period of insurance for Public Liability and
in the aggregate in the period of insurance for
Products Liability
DEDUCTIBLES (pound)1,000 each and every loss in respect of
third party property damage increasing to
(pound)10,000 in respect of heat work
3. Adequate Worker's Compensation Insurance and Employers' Liability
Insurance complying with applicable state laws with limits of $1,000,000
covering all Contractor's subcontracted U.S. employees working under this
Agreement.
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4. Automobile Liability Insurance, covering owned, hired and non-owned
vehicles, with a combined Bodily Injury and Property Damage Limit of
$1,000,000.
5. Physical Damage Insurance on Contractor's property to the extent of its
fair market value with any deductible to be for the account of the
Contractor.
6. In the event operations are over water, Contractor shall carry in addition
to the Statutory Workers' Compensation Insurance, endorsements covering
liability under the Longshoreman's and Harbor Workers' Compensation Act,
with Outer Continental Shelf Lands Act Extension and Maritime Liability,
including wages, transportation, maintenance and cure with limits of
(pound)10,000,000 for each death or injury to one person and
(pound)10,000,000 for any one accident, and endorsed to provide that a
claim "in rem" will be treated as a claim "in personam."
7. If Contractor rents or leases marine equipment and/or furnishes marine
services hereunder, Contractor, in additions to all applicable insurance
coverage provided in this Exhibit A, shall carry adequate Protection and
Indemnity Insurance or Commercial General Liability Insurance with
Watercraft exclusion deleted, and endorsed to include Contractual
Liability coverage covering vessel or vessels used and its equipment.
Contractor shall also carry Hull Insurance in such amounts and against
such risks as Contractor deems adequate to compensate it fully for loss or
damage to said property, and in the event of damage or loss of such
property, to look to its insurance carrier for payment of such loss or
damage and hereby releases Company and waives any claim for loss of such
property or damages that may result to Contractor in excess of any sum
that it may receive from its insurance carrier because of such loss or
damage. Contractor shall not use any vessel in the performance of work for
Company at any time unless said vessel is adequately covered by insurance,
as herein provided, and is operated within the navigation limits of the
insurance policies.
8. Aviation Liability Insurance to cover aircraft, if any, owned, chartered,
or hired by Contractor and used for or in connection with the performance
of this Contract with a combined Bodily Injury and Property Damage Limit
of not less than $1,000,000 per accident or occurrence.
9. Prior to commencing work for NGS, Contractor shall obtain from its
insurers a waiver of subrogation against the NGS Group and any operator or
owner for whom NGS is performing operations or services in all of the
insurance policies set forth in this Exhibit A, to include all insurance
carried by Contractor protecting against loss or damage to its property
and equipment employed in the performance of this Agreement.
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10. All insurance shall be carried in a company or companies with an A.M. Best
rating of at least A+, or equivalent, and shall be maintained in full
force and effect during the term of this Agreement, and shall not be
cancelled, altered, or amended without thirty (30) days prior written
notice having first been furnished NGS. NGS herein approves Chubb as an
acceptable company.
11. Additionally, to the extent Contractor assumes liability hereunder, and
agrees to indemnify NGS, the NGS Group shall be named additional insureds
in all such insurance policies (with exception of Workers' Compensation
coverage) or shall be covered by an "indemnity to principals" clause, with
all such insurance being primary to any insurance of NGS that may apply to
any such occurrence, accident or claim.
12. No "other insurance" provision shall be applicable to the NGS Group by virtue
of having been named an additional insured, loss payee, or covered by an
"indemnity to principals" clause under any policy of insurance. Contractor
agrees to furnish NGS a certificate or certificates evidencing coverage in
accordance with the requirements of this Exhibit A and when requested by NGS,
to furnish certified copies of all said insurance policies. These
requirements shall be conditions precedent to the payment of any sums that
may be due Contractor.
13. In the event Contractor is a self-insurer and NGS has consented to
Contractor being a self-insurer as to any one or more of the risks as to
which coverage is herein required, evidence of such consent must be in
writing and approved by a representative of NGS authorized to enter into
such consent agreement.
Any and all deductibles in the above described insurance policies shall be
assumed by, for the account of, and at Contractor's sole risk.
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