Terms and conditions - PreFer Industries

PreFer Industries Standard Terms and Conditions for the Purchase of Goods and/or Services

1. Interpretation

1.1 Definitions. In these Standard Terms and Conditions, unless there is something inconsistent in the subject matter or content, or unless otherwise specifically provided herein, the following terms shall have the meanings ascribed to them below:

“Affiliate” means any corporation, limited liability company, partnership, joint venture, firm or other form of enterprise which directly or indirectly Controls or is Controlled by or is under common Control with the Buyer or the Seller, as the case may be;
“Agreed Standard Terms” means these Standard Terms and Conditions for the Purchase of Goods and/or Services;
“Agreement” means the applicable Purchase Order, together with these Agreed Standard Terms;
“Buyer” means the Buyer set out in the Purchase Order;
“Buyer Related Party” means any of the Buyer’s Affiliates and the shareholders, directors, officers, employees, agents, representatives, contractors, subcontractors, licensees and invitees of the Buyer and any of its Affiliates; in this section 1.1(e), “invitee” means any person who the Buyer or a Buyer Related Party invites on or otherwise causes to be on a Site;
“Cause” has the meaning ascribed in section 7.3;
“Change Order” means a written or electronic document issued by the Buyer that contains changes to a Purchase Order;
“Compensation” means the amounts payable for any Services, including all taxes, insurance and other miscellaneous charges associated with the Services;
“Confidential Information” has the meaning ascribed in section 12.1;
“Control” means the right to the exercise, directly or indirectly, of at least fifty per cent (50%) of the voting rights attributable to the shares or other ownership interests in any body corporate, limited liability company, partnership, joint venture, firm or other enterprise;
“Convention” has the meaning ascribed in section 12.9;
“CRA” has the meaning ascribed in section 4.10;
“Delay” has the meaning ascribed in section 10.1;
“Delayed Party” has the meaning ascribed in section 10.1;
“Delivery Location” means the location for the delivery of Goods which shall be DPU Buyer unless otherwise specified in the Purchase Order;
“Delivery Schedule” means the schedule for the delivery of Goods as specified in the Purchase Order;
“Equipment” means all equipment supplied by the Seller pursuant to an Agreement, and for purposes of section 8 means the Goods;
“Goods” mean the goods to be supplied to the Buyer by the Seller as set forth in the Purchase Order;
“GST” has the meaning ascribed in section 5.4;
“HST” has the meaning ascribed in section 5.4;
“Incoterm” means the Incoterms 2020 delivery terms applicable to the delivery of the Goods by the Seller to the Buyer;
“Laws” means all laws, statutes, acts, codes, regulations, bylaws, ordinances, rules, restrictions, regulatory policies, common law principles, equitable principles, treaties, Conventions (except as provided in section 12.9) and international laws and any and all other lawful requirements from whatever source, of or applicable in any national, federal, state, provincial, municipal, regional or other jurisdiction now or hereafter in force, including any and all directions, orders, judgments, decrees, awards or writs of any court, tribunal or governmental authority having jurisdiction which are applicable to the Seller and the Buyer or either of them in respect of the transactions contemplated in this Agreement;
“Liabilities” has the meaning ascribed in section 12.17;
“Lien” means any charge, security interest, hypothec, lien (statutory or otherwise, including construction, builder’s, mechanic’s, unpaid vendor’s, miner’s or other lien for unpaid work or services) or other encumbrance of any nature which, in substance, secures payment or performance of an obligation;
“MRQ” has the meaning ascribed in section 4.10;
“Notice” has the meaning ascribed in section 12.19;
“Parties” means the Buyer and the Seller named in an Agreement;
“person” means any individual, body corporate, firm, partnership, joint venture or other form of enterprise other than the Parties;
“Price” means the price to be paid by the Buyer to the Seller for Goods purchased pursuant to an Agreement;
“Purchase Order” means a written or electronic purchase order of the Buyer for the purchase of Goods and/or Services, which specifies a purchase order number and includes other schedules, exhibits or other documentation attached thereto or incorporated by reference;
“QST” has the meaning ascribed in section 5.4;
“RST” has the meaning ascribed in section 5.4;
“Rules” has the meaning ascribed in section 12.19;
“Seller” means the Seller set out in the Purchase Order;
“Seller Documents” means confirmations, invoices and all other documents issued by the Seller in connection with the sale of Goods to the Buyer;
“Seller Related Party” means any of the Seller’s Affiliates and the shareholders, directors, officers, employees, agents, representatives, dealers, distributors, contractors, subcontractors, licensees and invitees of the Seller and its Affiliates; in this section 1.1(ll), “invitee” means any person who the Seller or a Seller Related Party invites on or otherwise causes to be on a Site;
“Services” means installation, modification, maintenance, repair or other services to be performed by the Seller or a Seller Related Party in respect of Goods purchased or proposed to be purchased by the Buyer from the Seller as may be provided in the Purchase Order, and/or other professional services set out in the Purchase Order, including any ancillary services reasonably necessary for the Buyer to receive and benefit from the Goods and services purchased;
“Site” means any facility operated by the Buyer or a Buyer Related Party where Services are rendered under an Agreement;
“Software” for purposes of section 8 means all software and software documentation, if any, delivered to the Buyer by the Seller or otherwise licensed to the Buyer by the Seller under an Agreement;
“Tariff Documentation” has the meaning ascribed in section 3.13;
“Terms” means the terms and conditions set out in an Agreement.
“VAT” has the meaning ascribed in section 5.4;
“Warranty Remedy Period” has the meaning ascribed in section 8.1;
“Work Product” has the meaning ascribed in section 4.11;

1.2 Construction. In the Agreement: (a) the singular includes the plural and vice versa; (b) reference to any document means such document as amended from time to time upon mutual agreement of the Parties; (c) headings are for convenience only and are not intended to interpret, define or limit the scope, extent or intent of any Agreement or any provision thereof; (d) “include” or “including”means including without limiting the generality of any description preceding such term; and (e) all references to currency are to the lawful currency of Canada/United States, as specified. The Parties agree that any rule of construction to the effect that any ambiguity of an agreement will be resolved against the drafting Party will not apply to the interpretation of an Agreement.

Agreement

2.1 Entire Agreement. The Agreement constitute the entire agreement between the Buyer and the Seller in respect of the purchase of Goods and/or Services specified in a Purchase Order, and supersede any prior or contemporaneous oral or written agreements or communications between the Parties relating to the subject matter thereof.

2.2 Incorporation into Agreement. These Agreed Standard Terms shall be deemed incorporated into and made a part of each Agreement between the Buyer and the Seller.

2.3 Priority of Documents. In the event of, and to the extent only of any conflict between the Agreed Standard Terms and the Purchase Order, the Agreed Standard Terms will prevail over the Purchase Order unless such Purchase Order clearly indicates the Parties’ intention to override the provisions of these Agreed Standard Terms.

2.4 Acceptance. An Agreement shall be deemed to have been formed upon: the execution of a Purchase Order by the Buyer and the Seller;

Purchase of Goods

3.1 Purchase of Goods. A Purchase Order may be placed by the Buyer either: (a) orally and followed by a written or electronic Purchase Order; or (b) by delivery of a written or electronic Purchase Order. The quantity of Goods to be purchased under the Purchase Order, the delivery requirements specific to the Delivery Location (including days of week and times of day that deliveries will be accepted and packaging and delivery system requirements), the Delivery Schedule and shipping instructions and directions applicable to shipments to the Delivery Location and any other specifications for the Goods, as applicable, shall be as set out in the Purchase Order. No Purchase Order and/or any addition, waiver, alteration or modification thereto shall be valid unless made in writing and signed by authorized representative of each Party specifically referencing the relevant Purchase Order. The Seller may request changes to the Purchase Order, by written notice to the Buyer, in response to which the Buyer may issue a changed Purchase Order to be signed by authorized representative of each Party. If the Buyer is unable to accept the requested changes, the Buyer will cancel the Purchase Order without any cost or liability.

3.2 Delivery. The Seller shall deliver the Goods in accordance with the Delivery Schedule. Unless otherwise specified in the Agreement, the Seller shall be solely responsible for transporting and delivering the Goods to the Delivery Location. The Seller shall comply with all requirements under applicable Laws relating to the production, handling, loading, transporting, delivery and unloading of the Goods in and to each jurisdiction in which the Goods are transported and delivered and shall comply with such other requirements as may be specified in the Purchase Order. If the scheduled delivery of Goods is delayed by the Buyer or a force majeure event suffered by the Buyer, the Seller may, on prior written agreement with the Buyer, move the Goods to storage for the account of, and at the risk of, the Buyer whereupon the Goods shall be deemed to be delivered.

3.3 Delivery to a Site. Where Goods are to be delivered to a Site, the Seller shall consult with the Buyer to establish an agreed time for delivering the Goods or performing the Services and the Seller shall use all reasonable efforts to ensure that the Goods are delivered and the Services performed in accordance with the Delivery Schedule. No deliveries may be made prior to the scheduled delivery date without the prior approval of the Buyer. The Seller and the Seller Related Parties responsible for the delivery of Goods to a Site shall comply with the Buyer’s applicable code of conduct and Site policies and procedures, as may be provided by the Buyer at the time the Agreement is entered into by the Parties.

3.4 Packaging. The Goods shall be packaged in accordance with all applicable Laws and any Buyer specifications set out in an Agreement. All packages shall include labels and tags containing adequate and accurate information with respect to use, safety and treatment of the Goods. The Seller shall ensure that the Goods are properly contained, secured, labelled, and documented during the course of handling, loading, transporting, delivery and unloading so as to comply with all applicable Laws. A packing list showing the Purchase Order number and release number if applicable shall be included with each shipment. The shipping label on the shipping container shall be marked to show the Purchaser Order number of all Purchase Orders contained within the container and each interior container shall be marked to show the Purchase Order number.

3.5 Title and Risk of Loss. Title to the Goods and the risk of loss with respect thereto shall pass to the Buyer upon delivery in accordance with the Incoterm as specified in the Purchase Order, or if not so specified, then upon physical receipt of the Goods by the Buyer and any final inspection and acceptance by the Buyer following delivery to the Delivery Location specified in an Agreement.

3.6 Inspection. The Buyer may inspect or test the Goods during their manufacture, processing, construction, preparation, completion and delivery, at reasonable times upon reasonable advance notice and subject to compliance with the Seller’s policies regarding Site safety.

3.7 Excess Goods. If the Seller delivers Goods that is more than the quantity specified in the applicable Purchase Order or otherwise do not conform to the specifications set out in the applicable Purchase Order, the Buyer may return any excess quantities or non-conforming Goods to the Seller at the Seller’s sole risk and expense.

3.8 Cancellation. Purchase Orders for Goods may be cancelled by the Buyer in whole or in part as provided in section 7.2 hereof.

3.9 Product Warranties. In addition to, and without limiting the Seller’s standard Equipment, Services and Software warranty set out in section 8, the Seller represents, warrants and agrees that, unless otherwise prescribed in an Agreement: (a) such Goods will conform to the specifications set forth in the Purchase Order; (b) such Goods will be of the quality, size and dimensions ordered and be free from defects in material and workmanship; (c) such Goods will be free and clear of all Liens; (d) such Goods will be of new and merchantable quality; (e) good and marketable title to such Goods will be transferred to the Buyer upon delivery of the Goods pursuant to the applicable Incoterm; and (f) such Goods will comply with all applicable government standards and all Laws relating to health, safety and environmental matters. The
foregoing representations and warranties shall survive any inspection, delivery, acceptance or payment by the Buyer and in the case of sections 3.9 (a) and (b), for the Warranty Remedy Period as set out in the Seller’s standard warranty in section 8. In addition, the Seller will ensure that the Buyer has the full benefit of any manufacturer’s warranties that may be applicable to the Goods.

3.10 Ownership and License to Use Intellectual Property. The Seller grants to the Buyer a perpetual, royalty-free, irrevocable and transferable license to any patent, software, design, trade secret, know-how, documentation or information relating to the Goods which are owned by or licensed to the Seller as of the date of delivery of the Goods and are reasonably required in order for the Buyer to use the Goods in the manner contemplated in the Agreement.

3.11 Licenses to Sell Goods. The Seller shall hold and keep in good standing and shall cause each Seller Related Party involved in the sale of Goods to the Buyer to hold and keep in good standing all licenses, permits, authorizations, registrations, exemptions, consents and approvals required to be held by the Seller or such Seller Related Party under applicable Laws in such jurisdictions in order to sell and deliver Goods to the Buyer.

3.12 Compliance with Laws. The Seller shall comply and shall cause each Seller Related Party involved in the sale of Goods to the Buyer to comply with all applicable Laws relating to the sale and delivery of the Goods, including any applicable rules and regulations related to ethical and responsible standards dealing with human rights (including human trafficking and slavery), employment standards and environmental protection, as well as applicable anti-bribery laws.

3.13 Tariff Documentation. The Seller shall provide to the Buyer on request any certificates of origin, affidavits of manufacturer or other tariff documentation for any Goods which receive preferential tariff treatment under any trade agreement or special tariff agreement (collectively, “Tariff Documentation”). The Tariff Documentation shall be provided with each shipment of Goods. The Seller shall update any Tariff Documentation and shall notify the Buyer of any changes affecting eligibility under any applicable trade agreement or special tariff agreement within thirty (30) days after any change occurs. The Seller shall ensure that all Goods with foreign origin are marked in English with the country of origin.

4. Supply of Services

4.1 Supply of Services. The Seller shall perform or shall cause Seller Related Parties to perform any Services described in a Purchase Order in accordance with the specifications set out therein.

4.2 Performance and Subcontracting. The Seller shall perform and shall cause each Seller Related Party to perform the Services safely, in accordance with the specifications and the Agreement, and in accordance with industry standards and all applicable Laws. The Seller shall not subcontract the performance of the Services without the Buyer’s prior written consent. Subcontracting shall not release the Seller from any of its obligations under the Agreement, provided that performance of any Services in full by a subcontractor shall be deemed performance of such Services by the Seller.

4.3 Equipment. Unless the Purchase Order provides
otherwise, the Seller will supply all equipment, parts andmaterials necessary to perform the Services, at the Seller’s expense.

4.4 Access to Site. The Seller and Seller Related Parties shall have access to any Site to the extent required for the performance of any Services described in the Purchase Order. The Seller, the Seller Related Parties and any of their personnel responsible for the performance of Services at a Site shall: (a) comply with the Buyer’s policies in accordance with section 4.5, as such policies may be provided by the Buyer from time to time; (b) not interfere with the Buyer’s activities and leave the Buyer’s premises secure, clean orderly having regard to the condition of such premises immediately prior to such access by the Seller or Seller Related Parties; and (c) perform the Services in a manner that does not prejudice safe working practices, safety and care of property and continuity of work at the Site.

4.5 Compliance with Buyer Policies. For Services performed at a Site, the Seller shall comply with all lawful directions given by the Buyer and management at the Site.

4.6 Inspection. The Buyer shall have the right to inspect the Services at any time during the Agreement term. To assist the Buyer in this respect, the Seller shall give the Buyer reasonable notice of readiness for inspection of all Services before the same are substantially completed.

4.7 Knowledge of Hazards and Acceptance of Risks. For Services performed at a Site, the Seller shall have a reasonable opportunity to inspect the Site prior to the performance of any Services and, following such inspection shall be deemed to accept risks that may be present in the performance of the Services except such risks that are caused or contributed to by the negligence or willful default of the Buyer or any Buyer Related Party. The Seller assumes responsibility for loss of, or damage to, the materials, machinery, equipment and other property of the Seller and any Seller Related Party used in performance of the Services at the Site except to the extent caused by the negligence or willful default of the Buyer or any Buyer Related Party. The Seller shall ensure that all Seller Related Parties performing Services at the Site meet the same standards as are required of the Seller under section 4.8.

4.8 Service Warranties. In addition to and without limiting the Seller’s standard Equipment, Services and Software warranty set out in section 8, unless otherwise prescribed in an Agreement, the Seller represents, warrants and covenants to the Buyer that (a) the Services will be performed to the standard of care, skill and diligence normally provided by competent professionals in their performance of services similar to the Services contemplated in the Purchase Order; (b) the persons performing the Services on behalf of the Seller will not unreasonably interfere with the Buyer’s activities or the activities of any other person at the Site;

4.9 Employment Costs and Charges. Unless and except to the extent otherwise provided in the Purchase Order, the Seller shall be responsible for paying and remitting or causing to be paid and remitted all costs and charges related to and arising from the performance of the Services, including all fees, wages, holiday pay, medical insurance payments, employment taxes, workers compensation assessments, workers insurance premiums and all other statutory deductions and benefits relating to persons performing the Services.

4.10 Withholding Tax. If the Seller or any Seller Related Party performing Services is not a resident of Canada, the Buyer shall be entitled to withhold and remit to the Canada Revenue Agency (the “CRA”) an amount equal to fifteen percent (15%) of the gross amount paid to the Seller for the performance of any Services rendered in Canada to the Buyer (excluding disbursements accompanied by proper receipts) unless the Seller or such Seller Related Party has obtained from the CRA a waiver of such withholding tax or a reduction in the rate of such withholding tax. If the Seller or any Seller Related Party performing Services is not a resident of Canada, the Buyer shall be entitled to withhold and remit to the Ministry of Revenue Québec (the “MRQ”) an amount equal to nine percent (9%) of the gross amount paid to the Seller for the performance of any Services rendered in Québec to the Buyer (excluding disbursements accompanied by proper receipts) unless the Seller or such Seller Related Party has obtained from the MRQ a waiver of such withholding tax or a reduction in the rate of such withholding tax.

4.11 Ownership and License to Use Intellectual Property.

All right, title and interest in and to intellectual property in the Goods and Services, all work product generated by the performance of the Services, including any documentation, reports, drawings, designs, plans, schedules, manuals, and models, (collectively the “Work Product”) are the sole and exclusive property of the Seller.
The Seller grants to the Buyer and Buyer Related Parties a perpetual, royalty-fee, irrevocable and transferable license to any patent, software, design, trade secret, know-how or information relating to the Services and which are owned by or licensed to the Seller as of the date of delivery of the Services, and are reasonably required in order that the Buyer and Buyer Related Parties may benefit from the Services in the manner contemplated in the Agreement.
The Seller will not use any of the Buyer’s Confidential Information in providing services to others.

(d) The Parties shall execute and cause their respective Related Parties to execute such assignments and other documents as may be necessary to confirm the ownership of intellectual property rights as contemplated in this section 4.11, and unconditional and irrevocable waivers from all individuals involved in the creation of Work Product, of any rights which cannot be assigned, including moral rights.

4.12 Licenses to Perform Services. The Seller shall hold and keep in good standing and shall cause each Seller Related Party performing Services to hold and keep in good standing all licenses, permits, authorizations, registrations, exemptions, consents and approvals required to be held by the Seller and each such Seller Related Party under applicable Laws in order to perform the Services.

4.13 Compliance with Laws. The Seller shall comply and shall cause each Seller Related Party performing Services to comply with all applicable Laws in each jurisdiction relating to the performance of the Services, including any applicable rules and regulations related to ethical and responsible standards dealing with human rights (including human trafficking and slavery), employment standards, environmental protection, as well as applicable anti-bribery laws.

5. Price, Compensation, Change Orders and Payments

5.1 Price and Compensation. The Price to be paid for Goods and the Compensation to be paid for Services by the Buyer to the Seller shall be as set forth in the Purchase Order. The Price and Compensation shall remain in effect regardless of any changes in currency rates, revenue Laws, treasury regulations or tariffs, increases in the appraisal of the value of the Goods or Services by customs authorities of any country or other variables, unless otherwise provided in the Purchase Order. Such Prices and Compensation are inclusive of: (a) all charges for packaging, packing, insurance, equipment, materials or tools used in the delivery of the Goods and/or Services, as applicable; and (b) the cost of any miscellaneous services of any kind which are commonly provided with the Goods and any miscellaneous items of any kind which are commonly used or supplied in the performance (and in conjunction with) the Services.

5.2 Change Orders. If modifications contained in the Change Order can reasonably be expected to necessitate an adjustment to the Price, Compensation or Delivery Schedule, as the case may be, the Parties shall endeavour to reach an equitable adjustment as soon aspracticable so as not to adversely affect the Price, Compensation or Delivery Schedule. Unless otherwise agreed, the amount of any Price adjustment shall be equal to the amount of the increase or decrease in the costs incurred by the Seller directly resulting from the Change Order.

5.3 Amount of Payment. Payment of the Price for Goods and the Compensation for Services shall be made as specified in the Purchase Order. Any modification to the Price or the Compensation shall be of no force or effect unless processed through a Change Order signed by the Parties in accordance with section 5.2.

5.4 Taxes, Duties and Other Charges. Except as otherwise provided in an Agreement, the Seller shall be responsible for remitting or causing to be remitted all taxes (including goods and services tax (“GST”), retail sales tax (“RST”), harmonized sales tax (“HST”), value added tax (“VAT”), Québec Sales Tax (“QST”) or similar taxes or charges where applicable), duties, imposts or other charges relating to the purchase and sale of the Goods to the Buyer and the performance of any Services for the Buyer.

5.5 Customs and Regulatory Approvals. Except as otherwise provided in the Agreement, the Seller shall obtain all customs approvals and permits and meet all other regulatory requirements to permit the sale of the Goods to the Buyer and delivery of the Goods to the Delivery Location, other than any customs approvals, permits or other regulatory requirements which by their nature can only be obtained by the Buyer.

5.6 Invoices and Payment Terms. Except as otherwise provided in the Agreement, payment by the Buyer shall be due to the Seller thirty (30) days from the date of receipt by the Buyer of a Seller’s invoice.

6. Mutual Representations and Warranties

6.1 Representations and Warranties. Each Party to an Agreement represents and warrants to the other that:

the Agreement has been duly authorized by all necessary procedures;
the Agreement does not violate any provision of the Party’s governing documents or any Laws applicable to such Party;
the Agreement will not result in the breach of any agreement by which such Party is bound;
the Party has the requisite power, capacity and authority to carry out all of its obligations under the Agreement; and
as at the effective date of an Agreement, there are no, and there will not be any, material outstanding litigation, investigation, arbitration or other disputed matters to which the Party is a party which may have a material adverse effect upon the supply of the Goods or usage of the deliverables and the Services or the fulfillment of the Party’s responsibilities and obligations pursuant to the Agreement.

7. Correction of Errors, Cancellations and Termination for Cause

7.1 Correction of Errors. If the Seller fails to deliver any Goods or perform any Services within the deadlines specified in the Purchase Order or to provide Goods or perform Services in accordance with the specifications set out in the Purchase Order or the specifications and requirements provided by the Buyer’s contact person at the Site, then the Buyer may, at its option, without limitation: (a) extend the delivery period or allow a correction to be made; (b) suspend the Buyer’s obligations under the Agreement until the failure to deliver is addressed to the Buyer’s reasonable satisfaction or the error is corrected; (c) terminate the Agreement for Cause under section 7.3; or (d) return and request refund or re-performance.

7.2 Cancellation of Purchase Orders. The Buyer may cancel a Purchase Order or the delivery of some of the Goods or Services referred to therein at any time prior to shipment/performance for its sole convenience. Upon written notice of such cancellation, the Seller shall use all reasonable efforts to mitigate all costs or expenses incurred up to the date of cancellation, including immediately stop all production and shipment of any Goods and any Services referred to in the notice of cancellation and shall cause any applicable Seller Related Parties to do the same. The Seller shall invoice (in accordance with the billing method set out herein) and the Buyer shall pay for the cost of Goods and/or Services delivered prior to the date of any such cancellation. The receipt of such payment from the Buyer is the Seller’s sole and exclusive remedy in respect of the Buyer cancelling the Purchase Order in accordance with this section 7.2. No other payment of any kind whatsoever shall be due from the Buyer to the Seller including, without limitation, payment for: (a) any loss of anticipated profits; (b) any direct, indirect, special, consequential or other forms of damages; (c) expenses of the Seller or Seller Related Parties incurred after receipt of notice of cancellation, or for costs incurred by the Seller or any Seller Related Parties that the Seller or such Seller Related Parties could reasonably have avoided; (d) losses on other contracts, agreements or arrangements however arising; (e) any other costs, loss or expenses of the Seller or Seller Related Parties from any other sources whatsoever, whether arising directly or indirectly under or from an Agreement.

7.3 Termination for Cause. An Agreement may be terminated by a non-breaching Party for Cause. “Cause” means (a) a material breach of the Agreement; (b) if a Party (deemed for purposes hereof to be the breaching Party) is adjudged insolvent, proposes a compromise or arrangement to its creditors generally, files for protection from its creditors under any applicable bankruptcy or other Laws for the administration of insolvent estates, files or has filed against it any proceedings to have it declared bankrupt, takes or has taken against it any proceedings to have it wound up, or files or has filed against it any proceeding to have a receiver appointed over any of its assets; (c) prolonged force majeure in accordance with section 10.1; (d) a Party has reasonable grounds for believing that the other Party is in breach of its obligation to comply with applicable Laws as required by the Agreement; or (e) a Party is found by a governmental authority or a competent court to be guilty of money laundering, breaching any Law relating to bribery, corruption or offering inducements, or in breach of any other applicable Law. No termination by the Buyer or the Seller for a material breach of the Agreement shall be effective unless, within fifteen (15) days after receipt by a Party of the other Party’s notice specifying such material breach, the receiving Party shall have failed to cure such specified material breach to the reasonable satisfaction of the non-breaching Party. Termination of the Agreement in accordance with this section 7.3 shall be without cost or liability to the Party so terminating, and shall not prejudice or affect any right of action or remedy which will have accrued to any Party up to and including the date of such termination.

7.4 Obligations Upon Termination. Any right or obligation
of a Party based on either performance or a breach of an Agreement prior to the effective date of termination of the Agreement shall survive the termination.

8. Seller’s Standard Goods, Services and Software Warranty

8.1 Equipment and Services Warranty. The Seller warrants that Equipment (excluding Software, which is warranted as specified in section 8.4 below) shall conform to any specifications set out in the Purchase Order and shall be delivered free of defects in material and workmanship and that Services shall be free of defects in workmanship. Except as otherwise provided in the Purchaser Order, the warranty remedy period (the “Warranty Remedy Period”) for: (i) Equipment (excluding Software, spare parts and refurbished or repaired parts) shall end no less than twelve (12) months after the delivery date in the Delivery Schedule (ii) new spare parts shall end no less than twelve (12) months after date of shipment; (iii) refurbished or repaired parts shall end no less than ninety (90) days after date of shipment; and (iv) Services shall end no less than ninety (90) days after the date of final performance of the Services.

8.2 Equipment and Services Remedy. If a nonconformity to the foregoing warranty is discovered in the Equipment or Services during the applicable Warranty Remedy Period, as specified above, under normal and proper use and provided the Equipment has been properly stored, installed, operated and maintained by the Buyer, and written notice of such nonconformity is provided to the Seller promptly after such discovery and within the applicable Warranty Remedy Period, the Seller shall, at the Buyer’s election, either (i) repair or replace the nonconforming portion of the Equipment or re-perform the nonconforming Servicesor (ii) refund the portion of the price applicable to the nonconforming portion of Equipment or Services. If any portion of the Equipment or Services so repaired, replaced or re-performed fails to conform to the foregoing warranty, and written notice of such nonconformity is provided to the Seller promptly after discovery and within the original Warranty Remedy Period applicable to such Equipment or Services or thirty (30) days from completion of such repair, replacement or re-performance, whichever is later, the Seller will repair or replace such nonconforming Equipment or re-perform the nonconforming Services. The original Warranty Remedy Period shall not otherwise be extended.

8.3 Exceptions. The Seller shall not be responsible for providing working access to the nonconforming Equipment, including disassembly and re-assembly of non-Seller supplied equipment, or for providing transportation to or from any repair facility, all of which shall be at the Buyer’s risk and expense. The Seller shall have no obligation with respect to any Equipment which: (i) has been subjected to misuse, negligence or accident; (ii) has been used in a manner contrary to the Seller’s express instructions.

8.4 Software Warranty and Remedies. The Seller warrants that, except as specified below, the Software will, when properly installed, execute in accordance with the Seller’s published specification and any other specifications set out in the Purchase Order. If a nonconformity to the foregoing warranty is discovered during the period ending twelve (12) months following the delivery date in the Delivery Schedule and written notice of such nonconformity is provided to the Seller promptly after such discovery and within that period, including a description of the nonconformity and complete information about the manner of its discovery, the Seller shall correct the nonconformity by, at its option, either (i) modifying or making available to the Buyer instructions for modifying the Software; or (ii) making available at the Seller’s facility necessary corrected or replacement programs. The Seller shall have no obligation with respect to any nonconformities resulting from: (i) unauthorized modification of the Software; or (ii) Buyer-supplied software or interfacing that has not been authorized by the Seller to be utilized with the Software. Except as set out in manuals or other documentation associated with the Software, the Seller does not warrant that the functions contained in the software will operate in combinations which may be selected for use by the Buyer. The Seller warrants that as of the time of delivery of the software products or performance of the Services, the deliverables and the Services do not contain any computer virus, computer worm, Trojan horse, authorization key, licence control utility, software lock or any similar coding. THE FOREGOING WARRANTIES TOGETHER WITH ANY OTHER WARRANTIES SET OUT IN THE AGREEMENT ARE EXCLUSIVE AND IN LIEU OF ALL OTHER WARRANTIES OF QUALITY AND PERFORMANCE, WHETHER WRITTEN, ORAL OR IMPLIED. ALL OTHER WARRANTIES, INCLUDING ANY IMPLIED WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR USAGE OF TRADE ARE HEREBY DISCLAIMED. THE REMEDIES STATED IN AN AGREEMENT CONSTITUTE THE BUYER’S EXCLUSIVE REMEDIES AND THE SELLER’S ENTIRE LIABILITY FOR ANY BREACH OF WARRANTY.

9 Insurance

9.1 Liability Insurance. The Seller shall carry comprehensive general liability insurance covering liabilities relating to the provisions of the Goods and any Services, including contingent employer’s liability coverage, and including coverage for injury (including death) and property damage, with a combined single limit of Two million dollars ($2,000,000) per occurrence and in the aggregate, covering claims by the Buyer with respect to the performance of an Agreement by the Seller or any Seller Related Party. The Buyer shall be added as an additional insured for claims of third parties to the extent such claims are caused by the act or failure to act of the Seller or any Seller Related Party and such coverage shall contain cross liability, severability of interest and waiver of subrogation provisions and be without right of contribution by any Buyer’s insurance to the extent such claims are caused by the act or failure to act of the Seller or any Seller Related Party.

9.2 Additional Coverage for Services. If the Seller or any Seller Related Party performs any Services under an Agreement, the Seller shall carry: (a) if Services are performed at a Site, insurance against loss or damage to the Buyer’s plant and equipment, machinery, tools, temporary buildings and any other property of the Buyer used in the performance of the Services, to the extent such loss or damage is caused by the act or failure to act of the Seller or any Seller Related Party, such coverage to be for the full replacement value of such property; and (b) motor vehicle liability insurance coverage for death or injury to any person or for loss or damage to property arising from the use of all owned and non-owned vehicles and mobile equipment used by the Seller or any Seller Related Party in the performance of Services, in the amount of Two million dollars ($2,000,000) per occurrence and in the aggregate, covering claims by the Buyer with respect to the performance of the Agreement by the Seller or any Seller Related Party, with the Buyer to be named as an additional insured in such policy for claims of third parties to the extent such claims are caused by the act or failure to act of the Seller or any Seller Related Party. The policy must contain a clause stating that thirty (30) days written notice will be given to the Buyer by the insurer in the event of a material change, cancellation or expiration of the insurance coverage.

9.3 Upon the Buyer’s request, the Seller shall provide the Buyer with a certificate of insurance evidencing the insurance required under this section 9.

10 Force Majeure

10.1 Force Majeure. No Party shall be liable for any delay or non-performance, other than for non-payment of money, resulting from acts of God, labour disturbances, strikes and lockouts, casualty, severe weather conditions, war, riots, acts of a public enemy or terrorist, civil disorder, pandemics, epidemics, earthquakes, insurrections, freight embargoes, custom delays at the port of shipment or destination, unforeseeable and irresistible event or other condition or occurrence of a similar nature beyond the Party’sreasonable control, provided thatsuch delay or nonperformance could not have been prevented by reasonable precautions (including back-up systems) and cannot reasonably be circumvented by the non-performing Party through the use of alternate sources, work-around plans or other means (such event, a “Delay”). If performance is delayed, prevented, restricted, or interfered with by a Delay: (a) the Party whose performance is Delayed (the “Delayed Party”) shall give prompt written notice to the other Party of the event and shall be excused from performance to the extent Delayed; provided, however, that the Delayed Party shall take reasonable steps to avoid or remove such causes of non-performance and shall resume performance whenever and to the extent such causes are removed; and (b) if it appears that a scheduled time for delivery of Goods or performance of the Services shall be Delayed for more than 90 days, such Delay will be deemed to cause the other Party unreasonable hardship, and the Party receiving notice of the Delay shall have the right to terminate, by written notice to the Delayed Party, shipments of any portion of the Goods to be delivered or Services to be performed which have been so Delayed.

11 Notices

11.1 Notices. All notices or other communications which are required or permitted to be given to the Parties under an Agreement shall be sufficient in all respects if given in writing and delivered in person or by electronic mail, facsimile, courier or certified mail, postage prepaid, return receipt requested, to the receiving Party at the address shown in the applicable Purchase Order or to such other address as the receiving Party may have given to the other Party by notice in writing. Notice shall be deemed given on the date of delivery, in the case of personal delivery, electronic mail, or facsimile, or on the delivery or refusal date as specified on the return receipt in the case of certified mail or on the tracking report in the case of delivery by courier.

12 General Provisions

12.1 Confidential Information. During the term of an Agreement the Parties may disclose to one another certain technical, operational, commercial, legal, pricing information or technical know-how of a confidential nature concerning the disclosing Party (“Confidential Information”). Such Confidential Information will either be indicated to be confidential or will evidently be so because of its nature. The receiving Party shall keep in confidence and prevent the unauthorized disclosure of all such Confidential Information, except Confidential Information (a) which is required to be disclosed by applicable Laws, court orders, court proceedings or the rules or policies of any stock exchange or government or regulatory authority having jurisdiction; (b) which is in the public domain at the date of the applicable Purchase Order or which becomes a part of the public domain after the date of the applicable Purchase Order other than through a breach of the Agreement by the receiving Party; (c) which has become known to the receiving Party independently on a non-confidential basis, whether before or after the date of the applicable Purchase Order, other than through a breach of the Agreement by the receiving Party or by a third party subject to any confidentiality agreement between the third party and the disclosing Party; or (d) which was independently developed by the receiving Party without reference to Confidential Information received hereunder. The receiving Party shall not make any use of Confidential Information of the disclosing Party for any purpose other than on a need-to-know basis for the purpose of an Agreement, or for the purpose for which the Confidential Information was provided by the disclosing Party. The obligations under this section 12.1 shall survive the termination of the Agreement. The Parties agree that upon written request by the disclosing Party, they will promptly return to the disclosing Party or destroy (such destruction to be certified in writing) all Confidential Information and copies thereof and shall require each of their respective Related Parties to do likewise. The Parties acknowledge that the Confidential Information is proprietary and confidential and that the harm suffered by the disclosing Party would not be compensable by monetary damages alone and, accordingly, in addition to other available legal or equitable remedies, the disclosing Party shall be entitled to apply for an injunction or specific performance with respect to such breach or threatened breach, without proof of actual damages and without posting security.

12.2 Use of Name. Neither Party shall use the name or trade-marks of the other in any sales promotion, advertising or other publication without the other’s prior written consent.

12.3 Assignment. An Agreement may not be assigned by either Party in whole or in part without the prior written consent of the other.

12.4 Relationship between Parties. Nothing contained in an Agreement shall be construed as creating a joint venture or partnership or employment or fiduciary relationship between the Parties. No Party shall have the power to control the activities or operations of the other Party, and their status shall at all times be that of independent contractors. No Party shall hold itself out as having any authority or relationship in contravention of this section.

12.5 Further Assurances. The Parties to an Agreement shall cooperate fully with each other and execute such further instruments, documents, and agreements and shall give such further written assurances as may be reasonably requested by the other Party to better evidence and reflect the transactions described herein and contemplated hereby, and to carry into effect the intent and purposes of the Agreement.

12.6 Amendments. An Agreement may not be modified or amended except by an instrument in writing (including Change Orders) signed by the Seller and the Buyer.

12.7 Severability. If any of the provisions of an Agreement shall for any reason be held void or unenforceable, the remaining provisions shall remain in full force and effect.

12.8 Governing Law. Unless the Parties to an Agreement otherwise agree in writing, (a) the Agreement shall be governed by and construed in accordance with the Laws of Ontario and the Laws of Canada applicable therein. The Parties voluntarily submit to the non-exclusive jurisdiction of the courts of Ontario situated in Toronto, Ontario.

12.9 United Nations Convention. The United Nations Convention on Agreements for the International Sale of Goods, or any amendment thereto, (the “Convention”) shall not apply to any Agreement. If the Convention is incorporated by reference as a Law of any jurisdiction, then to the extent permitted under the Laws of such jurisdiction the Convention shall not apply to any Agreement.

12.10 Waiver. The failure of one Party to insist upon the strict performance of any provision of an Agreement or to exercise any right, power, or remedy upon a breach thereof shall not constitute a waiver of that or any other provision of the Agreement or limit that Party’s right thereafter to enforce any provision or exercise any right.

12.11 Remedies. Except as otherwise expressly provided in the Purchase Order, the rights, powers and remedies of each Party shall be cumulative. Without limiting any other remedy available at law or in equity, if an Agreement is breached, injunctions, restraining orders, specific performance and other forms of equitable relief shall be available in the discretion of the Court.

12.12 Survival of Terms and Conditions. The provisions of sections 1, 2, 3.9, 3.10, 4.11, 5.6, 8, 11 and 12 and any other provisions which expressly , or by their nature ought to survive termination or expiration, will survive any termination or expiration of an Agreement.

12.13 Parties Bound by Agreement. Each Agreement is binding upon the Parties and upon their respective heirs, executors, administrators, successors and permitted assigns.

12.14 Language. The Parties hereto have expressly required that each Agreement and all documents and notices relating thereto be drafted in the English language. Les Parties aux présentes ont expressément exigé que cette entente et tous les documents et avis qui y sont afferents soient rédigés en language anglaise.

12.15 Limitation of Liability.

Subject to section 12.15(b), in no event shall the Seller or any Seller Related Party or the Buyer or any Buyer Related Party be liable for special, indirect, incidental or consequential damages, whether in contract, warranty, tort, negligence, strict liability or otherwise. In no event shall the maximum liability of the Seller or any Seller Related Party, with respect to any and all claims arising from Goods purchased or Services to be performed pursuant to an Agreement, exceed US $5,000,000 for insurable claims in accordance with section 9 hereof.
Notwithstanding anything to the contrary in an Agreement, the Parties do not exclude or limit its

liability in respect of any damages resulting from the breach of confidentiality obligations set out herein or the indemnification obligations set out under an Agreement.

12.16 Export Control. (a) The Buyer represents and warrants that the Goods and Services provided under any Agreement and the “direct product” thereof are intended for civil use only and will not be used, directly or indirectly, for the production of chemical or biological weapons or of precursor chemicals for such weapons, or for any direct or indirect nuclear end use; (b) If applicable, the Seller shall file for an export license, but only after appropriate documentation for the license application has been provided by the Buyer. The Buyer shall furnish such documentation within a reasonable time after an Agreement is entered into by the Parties. At the Seller’s request, the Buyer shall provide to the Seller a Letter of Assurance and End-User Statement in a form reasonably satisfactory to the Seller.

12.17 Intellectual Property Indemnity. (a) The Seller shall indemnify and save harmless the Buyer and the Buyer Related Parties from and against all claims, demands, suits, damages, costs, expenses, attorneys’ fees, judgments or similar liabilities (the “Liabilities”) arising from or incurred by reason of any claim that the use of the Services, Goods or any other deliverables supplied by the Seller constitutes an infringement or misappropriation of any patent, trade-mark or other intellectual property rights of a third party; (b) If the Buyer becomes subject to a claim set forth in (a) above, the Seller may, at its option and its own expense, procure for the Buyer the right to continue using the Goods, Service or deliverable; or modify or replace them with non-infringing deliverables/equipment; or remove it and refund the portion of the price allocable to the infringing Goods/Services; (c) the Seller shall not be liable under the indemnity in this section 12.17: (i) for any action settled or otherwise terminated by the Buyer without the prior written consent of the Seller; (ii) to the extent that any infringement or misappropriation claim is solely due to modification or combination of the Goods with other equipment or process not supplied, recommended or authorized by the Seller; or (iii) to the extent that any infringement or misappropriation claim is due to the Buyer’s design for the Goods or Services. THIS SECTION 12.17 STATES THE ENTIRE LIABILITY OF THE SELLER FOR ANY INFRINGEMENT OR MISAPPROPRIATION CLAIMS RELATING TO THE USE OF THE SERVICES, GOODS OR ANY OTHER DELIVERABLES SUPPLIED BY THE SELLER.

12.18 General Indemnities. Each Parties agrees to indemnify and save the other harmless from and against all Liabilities arising from or incurred by reason of the Party’s (or its Related Parties): (a) negligent act, omission or willful misconduct; (b) breach of an Agreement; (c) injury or death to person or damage or destruction to property caused by (a) or (b). The indemnified Party shall promptly give the indemnifying Party prompt notice of any such claim (although failure to do so shall only relieve the indemnifying Party of its obligations to the extent it is prejudiced). The indemnifying Party may, by notifying the indemnified Party in writing, assume control of the defense and settlement of the claims, provided that any settlement of such claims shall be subject to the reasonable approval of indemnified Party, acting reasonably, and shall include a full release of the claims made against the indemnified Party;

12.19 Dispute. The Parties agree that any dispute, controversy or claim arising out of this Agreement or its breach, termination or alleged invalidity, will be submitted to binding arbitration. Prior to the commencement of any arbitration, the Party initiating the arbitration will notify the other Party of the dispute in detail, and in writing (“Notice”). Each of the Parties will use its commercially reasonable efforts to resolve the dispute within thirty (30) days of delivery of the Notice. At any time after fifteen (15) days following delivery of the Notice, the Parties may engage in mediated negotiation with the assistance of a neutral person appointed by the parties jointly. In the event the dispute is not resolved within thirty (30) days of the delivery of the Notice, either of the Parties may submit the dispute to binding arbitration. The arbitration will be governed by the ADRIC Arbitration Rules (“Rules”) in effect at the time of arbitration. The arbitration tribunal will consist of a single arbitrator chosen by the Parties. If the Parties fail to designate the arbitrator within fifteen (15) business days of the Notice submitting the dispute to arbitration, such arbitrator will be appointed in the manner prescribed by the Rules. The scope of arbitration will be limited to the resolution of the dispute submitted to arbitration. The arbitrator will have all the powers of a court of law or in equity, including the power to make interim orders and orders granting injunctive relief. The language used for the arbitration will be English. The venue for the arbitration hearing shall be Toronto, Canada, at a location determined by the arbitrator. The expenses of the arbitration, including the fees of the arbitrator, will be borne initially by the Parties, equally. The unsuccessful Party to the arbitration will pay to the successful Party all reasonable costs and expenses, including reasonable legal fees and expenses incurred in relation to the arbitration, as well as the successful Party’s share of the expenses of the arbitration. The arbitrator will determine which Party is the successful Party in the arbitration. The unsuccessful Party will pay all costs, fees, levies and taxes arising from, necessitated by, the enforcement of arbitral award including, without limitation, registration and enforcement charges or other judicial levies. Either Party may seek preliminary injunctive or other interlocutory relief from the arbitrator during the arbitration. The Parties agree to be bound by the decision of the arbitrator and agree not to appeal the decision. An award of the arbitrator may be entered as a judgement or order into any court having jurisdiction by either Party and enforced in the same manner as a judgement or order to the same effect. Each Party consents to leave being granted, if necessary, to have any award of the arbitrator enforced in the same manner as a judgement or order to the same effect, in any court having jurisdiction.

13 Privacy

13.1 This offer and its content shall not be disclosed by Seller to any third party. The Buyer agrees that any data it provides to the Seller will be stored and processed in compliance with applicable data protection laws.

PreFer Industries Standard Terms and Conditions for the Sale of Goods and/or Services

1. Interpretation

“Affiliate” means any corporation, limited liability company, partnership, joint venture, firm or other form of enterprise which directly or indirectly Controls or is Controlled by or is under common Control with the Buyer or the Seller, as the case may be;
“Agreed Standard Terms” means these Standard Terms and Conditions for the Sale of Goods and/or Services;
“Agreement” means the applicable Sales Order, together with these Agreed Standard Terms and any other policies and documentation referenced with the written agreement of the Seller, as each may be amended, restated or supplemented from time to time;
“Buyer” means the Buyer set out in the Sales Order;
“Buyer Related Party” means any of the Buyer’s Affiliates and the shareholders, directors, officers, employees, agents, representatives, contractors, subcontractors, licensees and invitees of the Buyer and any of its Affiliates; in this section 1.1(e), “invitee” means any person who the Buyer or a Buyer Related Party invites on or otherwise causes to be on a Site;
“Cause” has the meaning ascribed in section 7.3;
“Change Order” means a written or electronic document issued by the Buyer that contains changes to a Sales Order;
“Compensation” means the amounts payable for any Services, including all taxes, insurance and other miscellaneous charges associated with the Services;
“Confidential Information” has the meaning ascribed in section 12.1;
“Control” means the right to the exercise, directly or indirectly, of at least fifty per cent (50%) of the voting rights attributable to the shares or other ownership interests in any body corporate, limited liability company, partnership, joint venture, firm or other enterprise;
“Convention” has the meaning ascribed in section 12.9;
“CRA” has the meaning ascribed in section 4.10;
“Delay” has the meaning ascribed in section 10.1;
“Delayed Party” has the meaning ascribed in section 10.1;
“Delivery Location” means the location for the delivery of Goods which shall be Ex-Works Seller unless otherwise specified in the Sales Order;
“Delivery Schedule” means the schedule for the delivery of Goods as specified in the Sales Order;
“Equipment” means all equipment supplied by the Seller pursuant to an Agreement, and for purposes of section 8 means the Goods;
“Goods” mean the goods to be supplied to the Buyer by the Seller as set forth in the Sales Order;
“GST” has the meaning ascribed in section 5.4;
“HST” has the meaning ascribed in section 5.4;
“Incoterm” means the Incoterms delivery terms applicable to the delivery of the Goods by the Seller to the Buyer;
“Laws” means all laws, statutes, acts, codes, regulations, bylaws, ordinances, rules, restrictions, regulatory policies, common law principles, equitable principles, treaties, Conventions (except as provided in section 12.9) and international laws and any and all other lawful requirements from whatever source, of or applicable in any national, federal, state, provincial, municipal, regional or other jurisdiction now or hereafter in force, including any and all directions, orders, judgments, decrees, awards or writs of any court, tribunal or governmental authority having jurisdiction which are applicable to the Seller and the Buyer or either of them in respect of the transactions contemplated in this Agreement;
“Liabilities” has the meaning ascribed in section 12.17;
“Lien” means any charge, security interest, hypothec, lien (statutory or otherwise, including construction, builder’s, mechanic’s, unpaid vendor’s, miner’s or other lien for unpaid work or services) or other encumbrance of any nature which, in substance, secures payment or performance of an obligation;
“MRQ” has the meaning ascribed in section 4.10;
“Notice” has the meaning ascribed in section 12.19;
“Parties” means the Buyer and the Seller named in an Agreement;
“person” means any individual, body corporate, firm, partnership, joint venture or other form of enterprise other than the Parties;
“Price” means the price to be paid by the Buyer to the Seller for Goods sold pursuant to an Agreement;
“Sales Order” means a written or electronic sales order agreed to by the Seller and the Buyer for the sale of Goods and/or Services, which specifies a sale order number and includes other schedules, exhibits or other documentation attached thereto or incorporated by reference;
“QST” has the meaning ascribed in section 5.4;
“RST” has the meaning ascribed in section 5.4;
“Rules” has the meaning ascribed in section 12.19;
“Seller” means the Seller set out in the Sales Order;
“Seller Documents” means confirmations, invoices and all other documents issued by the Seller in connection with the sale of Goods to the Buyer;
“Seller Related Party” means any of the Seller’s Affiliates and the shareholders, directors, officers, employees, agents, representatives, dealers, distributors, contractors, subcontractors, licensees and invitees of the Seller and its Affiliates; in this section 1.1(ll), “invitee” means any person who the Seller or a Seller Related Party invites on or otherwise causes to be on a Site;
“Services” means installation, modification, maintenance, repair or other services to be performed by the Seller or a Seller Related Party in respect of Goods purchased or proposed to be purchased by the Buyer from the Seller as may be provided in the Sales Order, and/or other professional services set out in the Sales Order, including any ancillary services reasonably necessary for the Buyer to receive and benefit from the Goods and services purchased;
“Site” means any facility operated by the Buyer or a Buyer Related Party where Services are rendered under an Agreement;
“Software” for purposes of section 8 means all software and software documentation, if any, delivered to the Buyer by the Seller or otherwise licensed to the Buyer by the Seller under an Agreement;
“Tariff Documentation” has the meaning ascribed in section 3.13;
“Terms” means the terms and conditions set out in an Agreement.
“VAT” has the meaning ascribed in section 5.4;
“Warranty Remedy Period” has the meaning ascribed in section 8.1;
“Work Product” has the meaning ascribed in section 4.11;

Agreement

2.1 Entire Agreement. The Agreement constitute the entire agreement between the Buyer and the Seller in respect of the purchase of Goods and/or Services specified in a Sales Order and supersede any prior or contemporaneous oral or written agreements or communications between the Parties relating to the subject matter thereof.

2.2 Incorporation into Agreement. Except as may otherwise be specifically provided in the Sales Order, these Agreed Standard Terms shall be deemed incorporated into and made a part of each Agreement between the Buyer and the Seller.

2.3 Priority of Documents. In the event of, and to the extent only of any conflict between the Agreed Standard Terms and the Sales Order, the Agreed Standard Terms will prevail over the Sales Order unless such Sales Order clearly indicates the Parties’ intention to override the provisions of this Agreed Standard Terms.

2.4 Acceptance. An Agreement shall be deemed to have been formed upon: (a) the execution of a Sales Order by the Buyer and the Seller; or (b) delivery by the Seller of the Goods or Services specified in a Sales Order issued by the Buyer.

Sale of Goods

3.1 Sale of Goods. A Sales Order may be placed by the Buyer either (a) orally and followed by a written or electronic Sales Order; or (b) by delivery of a written or electronic Sales Order. The quantity of Goods to be sold under the Sales Order, the delivery requirements specific to the Delivery Location (including days of week and times of day that deliveries will be accepted and packaging and delivery system requirements), the Delivery Schedule and shipping instructions and directions applicable to shipments to the Delivery Location and any other specifications for the Goods, as applicable, shall be as set out in the Sales Order. No Sales Order and/or any addition, waiver, alteration or modification thereto shall be valid unless made in writing and signed by authorized representative of each Party specifically referencing the relevant Sales Order. The Seller may request changes to the Sales Order, by written notice to the Buyer, in response to which the Buyer may issue a changed Sales Order to be signed by authorized representative of each Party. If the Buyer is unable to accept the requested changes, the Buyer will cancel the Sales Order without any cost or liability.

3.2 Delivery. The Seller shall deliver the Goods in accordance with the Delivery Schedule. Unless otherwise specified in the Agreement, the Seller shall be solely responsible for transporting and delivering the Goods to the Delivery Location. The Seller shall comply with all requirements under applicable Laws relating to the production, handling, loading, transporting, delivery and unloading of the Goods in and to each jurisdiction in which the Goods are transported and delivered and shall comply with such other requirements as may be specified in the Sales Order. If the scheduled delivery of Goods is delayed by the Buyer or a force majeure event suffered by the Buyer, the Seller may, on prior written notice to the Buyer, move the Goods to storage for the account of, and at the risk of, the Buyer whereupon the Goods shall be deemed to be delivered.

3.4 Packaging. The Goods shall be packaged in accordance with all applicable Laws and any Buyer specifications set out in an Agreement. All packages shall include labels and tags containing adequate and accurate information with respect to use, safety and treatment of the Goods. The Seller shall ensure that the Goods are properly contained, secured, labelled, and documented during the course of handling, loading, transporting, delivery and unloading so as to comply with all applicable Laws. A packing list showing the Sales Order number and release number if applicable shall be included with each shipment. The shipping label on the shipping container shall be marked to show the Sales Order number of all Sales Orders contained within the container and each interior container shall be marked to show the Sales Order number.

3.5 Title and Risk of Loss. Title to the Goods and the risk of loss with respect thereto shall pass to the Buyer upon delivery in accordance with the Incoterm as specified in the Sales Order, or if not so specified, then upon physical receipt of the Goods by the Buyer and any final inspection and acceptance by the Buyer following delivery to the Delivery Location specified in an Agreement.

3.7 Excess Goods. If the Seller delivers Goods that is more than the quantity specified in the applicable Sales Order or otherwise do not conform to the specifications set out in the applicable Sales Order, the Buyer may return any excess quantities or non-conforming Goods to the Seller at the Seller’s sole risk and expense.

3.8 Cancellation and Returns. Sales Orders for Goods may be cancelled by the Buyer in whole or in part as provided in section 7.2 hereof. Subsequent to shipment, cancellation of Sales Orders for Goods, other than defective Goods, shall be subject to the Seller’s return policy.

3.9 Product Warranties. In addition to, and without limiting the Seller’s standard Equipment, Services and Software warranty set out in section 8, the Seller represents, warrants and agrees that, unless otherwise prescribed in an Agreement: (a) such Goods will conform to the specifications set forth in the Sales Order; (b) such Goods will be of the quality, size and dimensions ordered and be free from defects in material and workmanship; (c) such Goods will be free and clear of all Liens; (d) such Goods will be of new and merchantable quality; (e) good and marketable title to such Goods will be transferred to the Buyer upon delivery of the Goods pursuant to the applicable Incoterm; and (f) such Goods will comply with all applicable government standards and all Laws relating to health, safety and environmental matters. The
foregoing representations and warranties shall survive any inspection, delivery, acceptance or payment by the Buyer and in the case of sections 3.9 (a) and (b), for the Warranty Remedy Period as set out in the Seller’s standard warranty in section 8. In addition, the Seller will ensure that the Buyer has the full benefit of any manufacturer’s warranties that may be applicable to the Goods.

3.10 Ownership and License to Use Intellectual Property. The Seller grants to the Buyer a perpetual, royalty-free, irrevocable and non-transferable license to any patent, software, design, trade secret, know-how, documentation or information relating to the Goods which are owned by or licensed to the Seller as of the date of delivery of the Goods and are reasonably required in order for the Buyer to use the Goods in the manner contemplated in the Agreement. For certainty, the foregoing license does not include updates to the Software first made publicly available by the Seller subsequent to the date of installation of the Goods.

4. Supply of Services

4.1 Supply of Services. The Seller shall perform or shall cause Seller Related Parties to perform any Services described in a Sales Order in accordance with the specifications set out therein.

4.3 Equipment. Unless the Sales Order provides
otherwise, the Seller will supply all equipment, parts andmaterials necessary to perform the Services, at the Seller’s expense.

4.4 Access to Site. The Seller and Seller Related Parties shall have access to any Site to the extent required for the performance of any Services described in the Sales Order. The Seller, the Seller Related Parties and any of their personnel responsible for the performance of Services at a Site shall: (a) comply with the Buyer’s policies in accordance with section 4.5, as such policies may be provided by the Buyer from time to time; (b) not interfere with the Buyer’s activities and leave the Buyer’s premises secure, clean orderly having regard to the condition of such premises immediately prior to such access by the Seller or Seller Related Parties; and (c) perform the Services in a manner that does not prejudice safe working practices, safety and care of property and continuity of work at the Site.

4.5 Compliance with Buyer Policies. For Services performed at a Site, the Seller shall comply with all lawful directions given by the Buyer and management at the Site.

4.7 Knowledge of Hazards and Acceptance of Risks. For Services performed at a Site, the Seller shall have a reasonable opportunity to inspect the Site prior to the performance of any Services and, following such inspection shall be deemed to accept risks that may be present in the performance of the Services except such risks that are caused or contributed to by the negligence or willful default of the Buyer or any Buyer Related Party. The Seller assumes responsibility for loss of, or damage to, the materials, machinery, equipment and other property of the Seller and any Seller Related Party used in performance of the Services at the Site except to the extent caused or contributed to by the negligence or willful default of the Buyer or any Buyer Related Party. The Seller shall ensure that all Seller Related Parties performing Services at the Site meet the same standards as are required of the Seller under section 4.8.

4.8 Service Warranties. In addition to and without limiting the Seller’s standard Equipment, Services and Software warranty set out in section 8, unless otherwise prescribed in an Agreement, the Seller represents, warrants and covenants to the Buyer that (a) the Services will be performed to the standard of care, skill and diligence normally provided by competent professionals in their performance of services similar to the Services contemplated in the Sales Order; (b) the persons performing the Services on behalf of the Seller will not unreasonably interfere with the Buyer’s activities or the activities of any other person at the Site;

4.9 Employment Costs and Charges. Unless and except to the extent otherwise provided in the Sales Order, the Seller shall be responsible for paying and remitting or causing to be paid and remitted all costs and charges related to and arising from the performance of the Services, including all fees, wages, holiday pay, medical insurance payments, employment taxes, workers compensation assessments, workers insurance premiums and all other statutory deductions and benefits relating to persons performing the Services.

4.11 Ownership and License to Use Intellectual Property.

All right, title and interest in and to intellectual property in the Goods and Services, all work product generated by the performance of the Services, including any documentation, reports, drawings, designs, plans, schedules, manuals, and models, (collectively the “Work Product”) are the sole and exclusive property of the Seller.
The Seller grants to the Buyer and Buyer Related Parties a perpetual, royalty-fee, irrevocable and non-transferable license to any patent, software, design, trade secret, know-how or information relating to the Services and which are owned by or licensed to the Seller as of the date of delivery of the Services, and are reasonably required in order that the Buyer and Buyer Related Parties may benefit from the Services in the manner contemplated in the Agreement. For certainty, the foregoing license does not include updates to the Software first made publicly available by the Seller subsequent to the date of installation of the Goods.
The Seller will not use any of the Buyer’s Confidential Information in providing services to others.

5. Price, Compensation, Change Orders and Payments

5.1 Price and Compensation. The Price to be paid for Goods and the Compensation to be paid for Services by the Buyer to the Seller shall be as set forth in the Sales Order. The Price and Compensation shall remain in effect regardless of any changes in currency rates, revenue Laws, treasury regulations or tariffs, increases in the appraisal of the value of the Goods or Services by customs authorities of any country or other variables, unless otherwise provided in the Sales Order. Such Prices and Compensation are inclusive of: (a) all charges for packaging, packing, insurance, equipment, materials or tools used in the delivery of the Goods and/or Services, as applicable; and (b) the cost of any miscellaneous services of any kind which are commonly provided with the Goods and any miscellaneous items of any kind which are commonly used or supplied in the performance (and in conjunction with) the Services.

5.2 Change Orders.. If modifications contained in the Change Order can reasonably be expected to necessitate an adjustment to the Price, Compensation or Delivery Schedule, as the case may be, the Parties shall endeavour to reach an equitable adjustment as soon aspracticable so as not to adversely affect the Price, Compensation or Delivery Schedule. Unless otherwise agreed, the amount of any Price adjustment shall be equal to the amount of the increase or decrease in the costs incurred by the Seller directly resulting from the Change Order.

5.3 Amount of Payment. Payment of the Price for Goods and the Compensation for Services shall be made as specified in the Sales Order. Any modification to the Price or the Compensation shall be of no force or effect unless processed through a Change Order signed by the Parties in accordance with section 5.2.

5.6 Setoff. The Buyer shall not be entitled to set off any amount payable by the Buyer under any Agreement against any financial obligations the Seller may have to the Buyer.

5.7 Invoices and Payment Terms. Except as otherwise provided in the Agreement, payment by the Buyer shall be due to the Seller ten (10) days from the date of receipt by the Buyer of a Seller’s invoice.

6. Mutual Representations and Warranties

6.1 Representations and Warranties. Each Party to an Agreement represents and warrants to the other that:

the Agreement has been duly authorized by all necessary procedures;
the Agreement does not violate any provision of the Party’s governing documents or any Laws applicable to such Party;
the Agreement will not result in the breach of any agreement by which such Party is bound;
the Party has the requisite power, capacity and authority to carry out all of its obligations under the Agreement; and
as at the effective date of an Agreement, there are no, and there will not be any, material outstanding litigation, investigation, arbitration or other disputed matters to which the Party is a party which may have a material adverse effect upon the supply of the Goods or usage of the deliverables and the Services or the fulfillment of the Party’s responsibilities and obligations pursuant to the Agreement.

7. Correction of Errors, Cancellations and Termination for Cause

7.1 Correction of Errors. If the Seller fails to deliver any Goods or perform any Services within the deadlines specified in the Sales Order or to provide Goods or perform Services in accordance with the specifications set out in the Sales Order or the specifications and requirements provided by the Buyer’s contact person at the Site, then the Buyer may, at its option, without limitation: (a) extend the delivery period or allow a correction to be made; (b) suspend the Buyer’s obligations under the Agreement until the failure to deliver is addressed to the Buyer’s reasonable satisfaction or the error is corrected; (c) terminate the Agreement for Cause under section 7.3; or (d) return and request refund or re-performance in accordance with the Seller’s Standard Goods, Services and Software Warranty set out in section 8.

7.2 Cancellation of Sales Orders. The Buyer may cancel a Sales Order or the delivery of some of the Goods or Services referred to therein at any time prior to shipment/performance for its sole convenience. Upon written notice of such cancellation, the Seller shall use all reasonable efforts to mitigate all costs or expenses incurred up to the date of cancellation, including immediately stop all production and shipment of any Goods and any Services referred to in the notice of cancellation and shall cause any applicable Seller Related Parties to do the same. The Seller shall invoice (in accordance with the billing method set out herein) and the Buyer shall pay for the cost of Goods and/or Services delivered prior to the date of any such cancellation. The receipt of such payment from the Buyer is the Seller’s sole and exclusive remedy in respect of the Buyer cancelling the Sales Order in accordance with this section 7.2. No other payment of any kind whatsoever shall be due from the Buyer to the Seller including, without limitation, payment for: (a) any loss of anticipated profits; (b) any direct, indirect, special, consequential or other forms of damages; (c) expenses of the Seller or Seller Related Parties incurred after receipt of notice of cancellation, or for costs incurred by the Seller or any Seller Related Parties that the Seller or such Seller Related Parties could reasonably have avoided; (d) losses on other contracts, agreements or arrangements however arising; (e) any other costs, loss or expenses of the Seller or Seller Related Parties from any other sources whatsoever, whether arising directly or indirectly under or from an Agreement.

8. Seller’s Standard Goods, Services and Software Warranty

8.1 Equipment and Services Warranty. The Seller warrants that Equipment (excluding Software, which is warranted as specified in section 8.4 below) shall conform to any specifications set out in the Sales Order and shall be delivered free of defects in material and workmanship and that Services shall be free of defects in workmanship. The warranty remedy period (the “Warranty Remedy Period”) for Equipment (excluding Software, spare parts and refurbished or repaired parts) shall end twelve (12) months after the delivery date in the Delivery Schedule. The Warranty Remedy Period for new spare parts shall end twelve (12) months after date of shipment. The Warranty Remedy Period for refurbished or repaired parts shall end ninety (90) days after date of shipment. The Warranty Remedy Period for Services shall end ninety (90) days after the date of final performance of the Services.

8.3 Exceptions. The Seller shall not be responsible for providing working access to the nonconforming Equipment, including disassembly and re-assembly of non-Seller supplied equipment, or for providing transportation to or from any repair facility, all of which shall be at the Buyer’s risk and expense. The Seller shall have no obligation with respect to any Equipment which: (i) has been improperly repaired or altered; (ii) has been subjected to misuse, negligence or accident; (iii) has been used in a manner contrary to the Seller’s instructions; or (iv) has failed as a result of ordinary wear and tear.

8.4 Software Warranty and Remedies. The Seller warrants that, except as specified below, the Software will, when properly installed, execute in accordance with the Seller’s published specification and any other specifications set out in the Sales Order. If a nonconformity to the foregoing warranty is discovered during the period ending twelve (12) months following the delivery date in the Delivery Schedule and written notice of such nonconformity is provided to the Seller promptly after such discovery and within that period, including a description of the nonconformity and complete information about the manner of its discovery, the Seller shall correct the nonconformity by, at its option, either (i) modifying or making available to the Buyer instructions for modifying the Software; or (ii) making available at the Seller’s facility necessary corrected or replacement programs. The Seller shall have no obligation with respect to any nonconformities resulting from: (i) unauthorized modification of the Software; or (ii) Buyer-supplied software or interfacing that has not been authorized by the Seller to be utilized with the Software. Except as set out in manuals or other documentation associated with the Software, the Seller does not warrant that the functions contained in the software will operate in combinations which may be selected for use by the Buyer. The Seller warrants that as of the time of delivery of the software products or performance of the Services, the deliverables and the Services do not contain any computer virus, computer worm, Trojan horse, authorization key, licence control utility, software lock or any similar coding. THE FOREGOING WARRANTIES TOGETHER WITH ANY OTHER WARRANTIES SET OUT IN THE AGREEMENT ARE EXCLUSIVE AND IN LIEU OF ALL OTHER WARRANTIES OF QUALITY AND PERFORMANCE, WHETHER WRITTEN, ORAL OR IMPLIED. ALL OTHER WARRANTIES, INCLUDING ANY IMPLIED WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR USAGE OF TRADE ARE HEREBY DISCLAIMED. THE REMEDIES STATED IN AN AGREEMENT CONSTITUTE THE BUYER’S EXCLUSIVE REMEDIES AND THE SELLER’S ENTIRE LIABILITY FOR ANY BREACH OF WARRANTY.

9 Insurance

9.3 Upon the Buyer’s request, the Seller shall provide the Buyer with a certificate of insurance evidencing the insurance required under this section 9.

10 Force Majeure

11 Notices

11.1 Notices. All notices or other communications which are required or permitted to be given to the Parties under an Agreement shall be sufficient in all respects if given in writing and delivered in person or by electronic mail, facsimile, courier or certified mail, postage prepaid, return receipt requested, to the receiving Party at the address shown in the applicable Sales Order or to such other address as the receiving Party may have given to the other Party by notice in writing. Notice shall be deemed given on the date of delivery, in the case of personal delivery, electronic mail, or facsimile, or on the delivery or refusal date as specified on the return receipt in the case of certified mail or on the tracking report in the case of delivery by courier.

12 General Provisions

12.1 Confidential Information. During the term of an Agreement the Parties may disclose to one another certain technical, operational, commercial, legal, pricing information or technical know-how of a confidential nature concerning the disclosing Party (“Confidential Information”). Such Confidential Information will either be indicated to be confidential or will evidently be so because of its nature. The receiving Party shall keep in confidence and prevent the unauthorized disclosure of all such Confidential Information, except Confidential Information (a) which is required to be disclosed by applicable Laws, court orders, court proceedings or the rules or policies of any stock exchange or government or regulatory authority having jurisdiction; (b) which is in the public domain at the date of the applicable Sales Order or which becomes a part of the public domain after the date of the applicable Sales Order other than through a breach of the Agreement by the receiving Party; (c) which has become known to the receiving Party independently on a non-confidential basis, whether before or after the date of the applicable Sales Order, other than through a breach of the Agreement by the receiving Party or by a third party subject to any confidentiality agreement between the third party and the disclosing Party; or (d) which was independently developed by the receiving Party without reference to Confidential Information received hereunder. The receiving Party shall not make any use of Confidential Information of the disclosing Party for any purpose other than on a need-to-know basis for the purpose of an Agreement, or for the purpose for which the Confidential Information was provided by the disclosing Party. The obligations under this section 12.1 shall survive the termination of the Agreement. The Parties agree that upon written request by the disclosing Party, they will promptly return to the disclosing Party or destroy (such destruction to be certified in writing) all Confidential Information and copies thereof and shall require each of their respective Related Parties to do likewise. The Parties acknowledge that the Confidential Information is proprietary and confidential and that the harm suffered by the disclosing Party would not be compensable by monetary damages alone and, accordingly, in addition to other available legal or equitable remedies, the disclosing Party shall be entitled to apply for an injunction or specific performance with respect to such breach or threatened breach, without proof of actual damages and without posting security.

12.2 Use of Name. Neither Party shall use the name or trade-marks of the other in any sales promotion, advertising or other publication without the other’s prior written consent.

12.3 Assignment. An Agreement may not be assigned by either Party in whole or in part without the prior written consent of the other.

12.6 Amendments. An Agreement may not be modified or amended except by an instrument in writing (including Change Orders) signed by the Seller and the Buyer.

12.7 Severability. If any of the provisions of an Agreement shall for any reason be held void or unenforceable, the remaining provisions shall remain in full force and effect.

12.11 Remedies. Except as otherwise expressly provided in the Sales Order, the rights, powers and remedies of each Party shall be cumulative. Without limiting any other remedy available at law or in equity, if an Agreement is breached, injunctions, restraining orders, specific performance and other forms of equitable relief shall be available in the discretion of the Court.

12.12 Survival of Terms and Conditions. The provisions of sections 1, 2, 3.9, 3.10, 4.11, 5.6, 8, 11 and 12 and any other provisions which by their nature ought to survive termination or expiration, will survive any termination or expiration of an Agreement.

12.13 Parties Bound by Agreement. Each Agreement is binding upon the Parties and upon their respective heirs, executors, administrators, successors and permitted assigns.

12.15 Limitation of Liability.

Subject to section 12.15(b), in no event shall the Seller or any Seller Related Party or the Buyer or any Buyer Related Party be liable for special, indirect, incidental or consequential damages, whether in contract, warranty, tort, negligence, strict liability or otherwise. In no event shall the maximum liability of the Seller or any Seller Related Party, with respect to any and all claims arising from Goods sold or Services to be performed pursuant to an Agreement, exceed: (i) US $2,000,000 for insurable claims in accordance with section 9 hereof; or (ii) US $2,000,000 for claims pursuant to the intellectual property indemnity in section 12.17.
Notwithstanding anything to the contrary in an Agreement, the Parties do not exclude or limit its

liability in respect of any damages resulting from the breach of confidentiality obligations set out herein or the indemnification obligations set out under an Agreement.

12.16 Export Control. (a) The Buyer represents and warrants that the Goods and Services provided under any Agreement and the “direct product” thereof are intended for civil use only and will not be used, directly or indirectly, for the production of chemical or biological weapons or of precursor chemicals for such weapons, or for any direct or indirect nuclear end use. The Buyer agrees not to disclose, use, export or re-export, directly or indirectly, any information provided by the Seller or the Goods as defined in the export control or equivalent regulations of applicable Laws, without the prior written consent of the Seller; (b) If applicable, the Seller shall file for an export license, but only after appropriate documentation for the license application has been provided by the Buyer. The Buyer shall furnish such documentation within a reasonable time after an Agreement is entered into by the Parties. At the Seller’s request, the Buyer shall provide to the Seller a Letter of Assurance and End-User Statement in a form reasonably satisfactory to the Seller.

13 Privacy

13.1 Information Privacy. This offer and its content shall not be disclosed by Buyer to any third party. The Buyer agrees that any data it provides to the Seller will be stored and processed in compliance with data protection laws and the Seller’s privacy policy which can be found at https://www.preferindustries.com/legal/

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