These general terms and conditions of sale shall apply to all service, equipment, goods or products manufactured, distributed or sold by EMSPEC Inc. (“Seller”). The contract will consist of the following contractual documents, listed in the decreasing order according to which they prevail one over the other:

a) The contract signed by both parties or the order accompanied by the acknowledgement of receipt.

b) As the case may be, the specific supplementary conditions.

c) The present General Terms & Conditions of Sales.

1. ACCEPTANCE OF CONDITIONS

The Purchaser, upon receipt of the Seller’s acknowledgement of an order, or upon receipt in whole or in part of the shipment sold under an order, or upon payment in whole or in part for the equipment, workmanship, goods or products related materials supplied hereunder, (“Equipment”) or rendition of services (“Services”) or both shall be deemed an unconditional acceptance by Purchaser of these terms and conditions. Any deletions from, alterations or modifications or additions to the terms and conditions of this order, shall not be binding unless they are expressed in writing and signed by both the Seller’s and the Purchaser’s authorized representatives.

2. DELIVERY

2.1 – Equipment sold hereunder unless agreed otherwise shall be delivered Ex Works (…named place) as per Incoterms 2020. Delivery dates specified in any quote are approximate, unless specified as binding. Delivery performance is dependent upon prompt receipt from the Purchaser of all specifications, final approved drawings and any other details essential to the proper execution of the Purchaser’s order.

2.2 – Upon notification of readiness of Equipment by Seller to Purchaser, Purchaser shall promptly take delivery of the Equipment. Purchaser’s delay to take delivery of the Equipment shall result in Purchaser paying storage, maintenance and associated charges and Seller shall invoice Purchaser as if shipment or other performance had been made as originally scheduled. Such storage, handling and maintenance shall be performed at Purchaser’s cost and risk. Failure of Purchaser to take A prompt delivery shall result in payment terms tied to such delivery becoming due immediately and payable. The Warranty Period hereinafter defined will begin upon such notification of readiness.

2.3 – Unless otherwise agreed upon between the parties, Purchaser shall have the sole responsibility of choosing the carrier and routing from Seller’s manufacturing facilities to the final destination.

3. FORCE MAJEURE

The Seller shall not be liable for delays in the execution of its obligations due to causes beyond its control including but not limited to acts of God, fires, strikes, labour disturbances, floods, epidemics, quarantine restrictions, war, insurrection or riot, acts of a civil or military authority, compliance with priority orders or preference ratings issued by any Government, acts of Government authorities with respect to revocation of export or re export permits/licenses, freight embargoes, car shortages, wrecks or delays in transportation, unusually severe weather, or inability to obtain necessary labour, materials or manufacturing facilities or supplies or delays of subcontractors. In the event of any such delay, the Contract schedule will be extended for a minimum of time equal to the period of the delay. The contract of sale will in no event be subject to cancellation by the Purchaser, due either to delay in delivery or to any other cause, without the prior written consent of the Seller. In the case of cancellation, cancellation charges judged adequate by Seller shall apply. The Seller shall be entitled to claim increased compensations for damages which he may suffer from any such causes.

4. WARRANTIES

4.1 – The Seller warrants that during the warranty period hereinafter defined the Equipment sold shall be free from defects in material and workmanship and shall be of the kind and quality designated or described in the Contract specifications.

4.2 – If within eighteen (18) months from the date of notification of readiness of shipment or twelve (12) months from date of first use by Purchaser or the end user, whichever date occurs first, the Equipment does not meet the warranties specified above, the Seller agrees to correct any defect, at its option, either by repairing any defective parts, or by making available Ex Works, repaired or replacement parts, provided the Purchaser notifies the Seller promptly of any such defects.

4.3 – The cost of removal of the defective Equipment from its related system, site and/or ancillary equipment, and the cost of its reinstallation in such system, site and/or ancillary equipment, including all transportation costs to and from Seller’s plant or repair shop, shall be borne exclusively by the Purchaser. The Purchaser shall not return or dispose of any Equipment or part thereof with respect to which it intends to make a claim under the foregoing warranty, without the Seller’s express prior written authorization.

4.4 – Where Seller supplies Services, Seller warrants that Services are given in a professional manner and in accordance with sound, generally accepted and professional practices in effect at the time of performance, for a period of one (1) year following completion of the Service, provided Seller receives immediate written notification of the defect.

4.5 – Any repair or replacement to the foregoing warranties pursuant hereto shall not renew or extend the warranties. The foregoing warranties shall be void in respect to any deficiency or defect resulting from, the Equipment being improperly operated by the Purchaser, operated under abnormal conditions or contrary to specifications or instructions of Seller, normal wear and tear, modifications or alterations made by Purchaser or a third party without Seller’s consent.

4.6 – The express warranties set forth in this article are exclusive and no other warranties of any kind, whether statutory, oral written, express or implied, including any implied warranty of merchantability or fitness for a particular purpose, shall apply. The purchaser’s exclusive remedies and the seller’s only obligations arising out of or in connection with defective equipment or services or both, whether based on warranty, contract, tort (including negligence) or otherwise, shall be those stated herein.

5. INSURANCE, CHARGES & PROPER CARE

Until the Purchaser has made full payment of amounts due to Seller hereunder, Purchaser shall exercise proper care in the possession and use of the Equipment and shall keep same at all times in good repair and free of all liens, options, taxes, charges, pledges, privileges and encumbrances. Purchaser shall insure Equipment against loss, destruction or theft for the full value of there placement purchase price of the Equipment.

6. TITLE & RISK

6.1 – The title to and property in the Equipment sold hereunder and any substitutions or additions thereto and the right to possession thereof, whether attached to realty or otherwise, shall pass from the Seller to the Purchaser when the full purchase price of the Equipment has been paid. Upon failure to make any payment as herein provided, the whole purchase price and any note or security given on account therefore shall forth with become due and payable and the Seller may immediately enter the premises where the Equipment is located and take possession of and remove the same as its personal property, and may retain any or all partial payments already received as a rental charge for the use of the Equipment without affecting any further or other claims which Seller may have against the Purchaser.

6.2 – Equipment sold hereunder shall be at the Purchaser’s risk on delivery to it as specified in Article 2 above and the loss or destruction of all or part of said Equipment shall not release Purchaser from any obligations of payment hereunder.

7. LIMITATION OF LIABILITY

7.1 – Modifications or adjustments to Purchaser’s processes or equipment upon the good faith recommendations of Seller shall be made at Purchaser’s risk. In no event shall Seller be liable for conditions of Purchaser’s site.

7.2 – The liability of the Seller, its agents, directors, officers, subcontractors, Sellers, employees, affiliated companies, for all claims, actions, judgments, expenses related to or resulting from any loss or damage arising out of performance or non-performance of the Contract shall in no event exceed 80% of the Contract Value. Where Seller sells Services, the liability of the Seller, its agents, directors, officers, employees, subcontractors or Sellers for all claims, actions, judgment or expenses related to or resulting from any loss or damage arising out of performance or non-performance of Services, shall in no case exceed in the aggregate 80% of the amount paid by the Purchaser to Seller for the Services performed under the Contract.

7.3 – No such claim shall be asserted against the Seller, its agents, directors, officers, employees, affiliated companies, subcontractors or Sellers, unless the injury, loss or damage giving rise to the claim is sustained prior to the expiration of the period of warranty herein and no suitor action thereon shall be instituted or maintained unless it is filed in a court of competent jurisdiction within one year after the date the cause of action accrues.

7.4 – In no event shall Seller, its agents, directors, officer, employees, subcontractors, affiliated companies or Sellers be liable to Purchaser for loss of profit and for any indirect, special, incidental or consequential damages of any nature or kind including but not limited to delays, loss of revenue, loss of use, economic loss, loss of data, loss of production, costs of capital or costs of replacement power, claims of Purchaser’s customers, even if Seller has been advised of the possibility of such damages.

7.5 – The limitations set forth in this Article 7 shall apply and be effective with respect to any claim, cause of action, or legal theory whatsoever including, but not limited to, contract or warranty (including performance guarantees)or breach thereof, indemnity, tort (including negligence) or strict liability.

7.6 – Clause 7 shall prevail over any conflicting or inconsistent provisions contained elsewhere in the Contract.

8. PRICES & PAYMENT TERMS

8.1 – Prices are valid sixty (60) days from date of quotation by Seller. Price adjustment clauses, if applicable, will be stated at the time of quotation and a copy will be included as part of these Terms and Conditions, in an Appendix thereto.

8.2 – All prices are Ex Works unless otherwise specified in writing by Seller, as per Incoterms 2020. Prices quoted do not include federal, provincial, local or any other taxes, charges, levies and duties, and if same are applicable these shall be promptly paid by the Purchaser. Purchaser shall reimburse Seller any late payment penalty.

8.3 – In cases where Seller’s price includes taxes, charges, levies and duties, in the event of any changes in any taxes, charges, levies or duties, imposed under any federal, provincial municipal or local legislation or authority, after the date of submitting of Seller’s tender or quotation and applicable to Equipment sold hereunder, the Seller’s sale price shall be adjusted to reflect such increases or decreases. Any penalty or interest charge levied against the Seller due to the Purchaser’s late payment shall be to Purchaser’s account.

8.4- Price information published in catalogues, bulletins or price lists is not a definite quotation or offer to sell.

8.5 – Seller reserves the right to adjust prices on any order for any alterations or changes authorized or made by the Purchaser subsequent to acceptance of the order.

8.6 – All prices are in Canadian Dollars unless otherwise specified.

8.7 – Payment shall be made direct to Seller’s office in accordance with the conditions stated in the order. Unless otherwise specified, payment shall be due net thirty (30) days from the date of sending of the relevant invoice by the Seller, and time is of the essence in Purchaser’s execution of any payment hereunder. Any late payment shall bear interest at the rate set by the Seller from time to time which is one and a half percent (1.5%) per month, eighteen percent per year (18%), at the date of issue, calculated and due on a monthly basis.

9. CANCELLATION CHARGES

Should the Purchaser wish to terminate the contract or order a work stoppage for any reasons, the Seller reserves the right to demand payment calculated as per the following table:

10. BANKRUPTCY

If the Purchaser becomes bankrupt or insolvent or makes any agreement with its creditors compounding debts or if, being a limited company, any proceedings are begun in respect of it applying for the appointment of a liquidator, administrator, receiver of similar official for it or all or any substantial part of its assets or seeking an order of relief against it as debtor or under any law I relating to insolvency, readjustment of debt, reorganization, administration or liquidation, the Seller may at any time by written notice terminate the Contract forthwith, in which event the provision of the CANCELLATION clause shall apply.

11. DAMAGES & LOSS CLAIMS

11.1 – Seller shall carefully pack all Equipment sold hereunder and the Seller shall assume no responsibility for damage after having received “in good order” receipts from the carrier at Seller’s works.

11.2 – All claims for loss, damage and delay in transit are to be transacted by the consignee directly with the carrier. Claims for shortages or incorrect equipment must be made in writing to the Seller within fifteen (15) days after receipt of the shipment. Failure to give such notice shall constitute unqualified acceptance and a waiver by the Purchaser of all claims for shortages or incorrect equipment.

12. CHANGES

Seller reserves the right to make changes in design or to add any improvement on Equipment or other goods at anytime, without incurring any obligations to install same on equipment or goods previously purchased or leased. Any changes caused or requested by Purchaser affecting the Equipment or otherwise affecting the scope of work must be accepted by Seller and resulting adjustment to price, schedule, or both, mutually agreed in writing.

13. TESTING & ACCEPTANCE OF GOODS

13.1 – Testing of the Equipment before shipment is carried out in accordance with Seller’s test procedures and at Seller’s cost. Additional tests shall be agreed upon specifically between Seller and Purchaser and shall be charged to the Purchaser.

13.2 – The Purchaser shall examine the Equipment upon taking possession of same and shall inform Seller immediately in writing of all defects and deficiencies for which Seller is responsible. If Purchaser omits to so notify Seller within thirty (30) days of Purchaser’s possession of the Equipment, same shall be deemed to have been accepted.

13.3 – Acceptance tests are carried out only if they have been agreed upon in writing by the Seller. As far as circumstances allow, such tests will be carried out in Seller’s factory. If, for reasons beyond Seller’s control, the acceptance tests cannot be carried out within the specified time, the qualities to be determined by these tests shall be deemed proved.

13.4 – If it is found from one of the aforementioned tests that the Equipment does not fulfil the terms of the order, the Purchaser shall make available to Seller suitable opportunity to remedy any deficiency.

13.5 – The Purchaser shall have no other rights than the rights outlined above, in case of delivery of deficient equipment.

14. TECHNICAL DOCUMENTS

14.1 – Technical documents, such as drawings, descriptions, illustrations and the like, and all weight data, shall serve as an approximate indication only, provided they have not been expressly specified as binding. Seller reserves the right to make any alterations considered necessary.

14.2 – All plans, drawings, technical specifications, documents, software, microfilm, data, or proprietary information relating to the Equipment sold, distributed or manufactured hereunder shall be treated in confidence by the Purchaser, who shall ensure the confidentiality thereof. They remain Seller’s exclusive property and may be neither copied nor reproduced nor communicated to a third party in any way whatever nor used for manufacture of the Equipment, or parts thereof. They may be used only for operation and maintenance of the Equipment, under terms and conditions specified by the Seller. If Purchaser or one of Purchaser’s Affiliates has knowledge that a Representative has breached its confidentiality obligations in respect of Confidential Information (a Potential Claim), then Purchaser shall promptly advise Seller. Purchaser also agrees to follow Seller’s reasonable instructions to pursue Potential Claims against such Representative provided that Purchaser agrees to indemnify Seller for costs reasonably incurred in connection with following such instructions.

15. GENERAL

15.1 – Purchaser shall not assign this contract or any part thereof without the written consent of the Seller.

15.2 – Any order received by the Seller is subject to credit approval and may be cancelled if the Purchaser’s credit standing is not satisfactory to Seller.

15.3 – This Agreement and any order or contract placed hereunder shall be interpreted according to the laws of the Canadian Province in which the Contract is executed and any and all disputes arising from this Contract shall be referred to a court of competent jurisdiction in the province in which the Contract is executed.

15.4 – No terms of Purchaser’s purchase order shall apply to this contract, even if subsequent to the terms and conditions hereof, unless agreed in writing by an authorized representative of the Seller.

15.5 – No penalties or liquidated damages shall apply pursuant to the in execution of Seller’s obligations hereunder, unless accepted in writing by an officer of the Seller.

15.6 – These terms and conditions shall supersede and abrogate all previous communications, obligations, commitments or agreements, oral or written, expressed or implied, between the Purchaser and the Seller, in relation to this Agreement and all provisions under the United Nations Convention on the International Sale of Goods (Vienna Convention) shall be excluded.

15.7 – Purchaser and Seller acknowledge having specifically requested that this Agreement and all related documents and correspondence be drafted in English.

15.8 – Any addenda or appendices to this Agreement, to be applicable to any order hereunder, must be signed by both Purchaser’s and Seller’s respective authorized representatives.

15.9 – Mistakes, unintended gaps and contradictions in the Contract are to be treated and construed in accordance with the spirit of this Contract on the basis of mutual trust and of the mutual interests of both Parties.

15.10 – In the event of any inconsistency between the English version of this Contract and any signed version or translation in another language, the English version shall prevail.

15.11 – Each Party shall, at its own expense satisfy any laws or requirements with respect to declaring, filing, recording or otherwise rendering this Contract valid.

15.12 – The Parties agree to comply with the anti-corruption laws and regulations in force under this Agreement. Under this Contract, the Parties or any legal or natural person acting on their behalf shall refrain from committing any illegal or unlawful act, and in particular from making any payment or offering anything of value to any person or government entity that may be considered abusive or illegal under the laws applicable to either Party

15.13 – No change or amendment to this contract, including this Clause shall be valid, unless it occurs in writing and will be duly executed by the Parties.

16. DELAYS BY PURCHASER

The Seller shall be entitled to a contract adjustment in respect to the Contract price and time schedule if its ability to perform the Work is impaired or delayed by the Purchaser or those for whom it is legally responsible. The Purchaser and the Seller shall mutually agree on an appropriate adjustment in contract price and time schedule.

17. TIME

Unless expressly provided in the Contract and mutually agreed to in writing, Seller shall have no liability in connection with delay in delivery of goods or services.

18. INSTALLATION SUPERVISION

Installation supervision is offered at the following conditions. Our Specialist will explain the installation sequence to minimize installation time, how the switch works and how to adjust the linkage to ensure smooth operation. He will do the 1st opening and closing operation to make sure that everything is working properly. He will provide training on site for the substation workers and owners employees in the operation and long term maintenance of the product.

EMSPEC will extend the warranty free of charge to 5 years if installation supervision is purchased.

19. SITE CONDITIONS

Unless otherwise agreed in writing, work outside Sellers’s own factory including but not limited to installation supervision, commissioning, testing, assessment and repair of the work or any portion thereof shall be subject to the following provisions:

1- Purchaser shall provide at its own expense and in a timely manner:

a) Unrestricted access to the Work Area, including but not limited to entry permits and security passes;

b) Comprehensive assistance with regard to obtaining import, export and customs clearance for personal belongings and goods of Seller’s personnel and of the equipment, tools and goods required for the Work;

c) Comprehensive assistance to Seller’s personnel for obtaining visas, work and residence permits to the extent required for the carrying out of the Work as well as with regard to any permits required for leaving the country;

d) Repatriation of Seller’s personnel in case of emergencies including but not limited to war, civil war, civil disturbance and epidemics;

e) All construction work and other ancillary services not specific to Seller’s trade as well as the necessary skilled and unskilled labour, materials and tools

f) The equipment and materials necessary for Seller’s performance of the Work such as scaffolding, lifting equipment etc.;

g) Electrical and other energy including but not limited to fuels and lubricants as may be required, water at the point of use, including connections, heating, and lighting;

h) Suitable, dry and lockable rooms of sufficient size at the site for the storage of machine parts, apparatus, materials ,tools etc. and adequate working and recreation rooms, if any, personnel, including telephones and communication lines and appropriate sanitary facilities. Furthermore, Purchaser shall take all reasonable measures for the protection of the property of Seller and its personnel;

i) The Work Area exempt from any health or safety risks going beyond what is normal and usual for the type of work to be performed by Seller; and

j) All health and safety measures in the event the same become necessary to protect Seller’s personnel.

2- Before the start of Work, Purchaser shall:

a) Make available, at its own cost and expense, all necessary information concerning the location of concealed electric power, gas and water lines or of similar installations as well as all required data concerning static and sub-surface conditions of the site, and

b) Provide all necessary materials and equipment to start work at the site and carry out all preparations to such a point that the assembly or installation can be started as agreed and carried out without interruption. Access roads and the site shall be clear and prepared for the Work.

3. If Work is delayed by circumstances for which Seller is not responsible, Seller shall be entitled to an equitable adjustment in schedule, price and other pertinent provisions of the Contract.

4. For any Work performed by Seller on a time and material or other cost reimbursable basis, Purchaser shall certify to Seller, at weekly intervals, the hours worked by Seller’s personnel and shall promptly confirm in writing the status of the Work.