Terms & Conditions
STANDARD TERMS AND CONDITIONS
In these conditions “the Buyer” shall mean Plant Engineering Nigeria Limited and “the Seller” shall mean any person, firm, or company to whom Plant Engineering Nigeria Limited has given a Purchase Order. ‘’The Conditions’’ means the standard terms and conditions set out in the document and includes any special term agreed in writing between the Seller and the Buyer. The “Goods”mean all or any product or materials supplied by the Company to the Buyer under this Agreement.
2.1 The Contract Price, any prices or rates mentioned in the Purchase Order are firm and not subject to escalation of any kind or currency exchange fluctuation during the validity of the Purchase Order or any agreed changes of schedule of the Purchase Order thereto.
2.2 Unless otherwise stipulated in the Purchase Order, all labor, equipment, materials, tools, consumables, services and the likes of whatsoever nature that are required to be supplied and/or performed by the Seller under the Purchase Order shall be at the Seller’s expense and shall be deemed to be included in the Contract Price.
2.3 All taxes, duties, fees, charges or assessments including postage and banking charges levied in connection with the Purchase Order shall be borne by the Seller.
3 Terms of Payment
3.1 Upon achievement of conditions precedent to the payment (other than the invoice) as provided in the Purchase Order, the Seller shall provide the Buyer with an invoice, in a form provided in the Purchase Order or approved by the Buyer, showing the amounts to which the Seller considers himself to be entitled, together with supporting documents.
3.2 Within Thirty (30) days after receiving the Seller’s invoice and supporting documents, the Buyer shall give to the Seller notice of any items in the invoice with which the Buyer disagrees, with supporting particulars. If the Buyer disagrees with the invoice submitted by the Seller, the payment for the disputed invoice shall not be made until the dispute is resolved by both Parties under the terms of the Purchase Order. Payments due shall not be withheld, except that:
3.3 if anything supplied or work done by the Seller is not in accordance with the Purchase Order, the cost of rectification or replacement may be withheld until rectification or replacement has been completed; and/or
3.4 If the Seller has failed or is failing to perform any work or obligation in accordance with the Purchase Order, and has been so notified by the Buyer, the value of this work or obligation may be withheld until the work or obligation has been performed properly.
3.5 The Buyer may, by way of making any payment, make any correction or modification to any amount previously considered due. Payment shall not be deemed to indicate the Buyer’s acceptance, approval, consent or satisfaction with respect to the quality of the Works. The Buyer shall have no liability for any losses, damages or costs suffered or incurred by the Seller in connection with rejection of invoices or withholding of payments.
3.6 All invoices submitted by the Seller shall be in compliance with applicable laws and regulations, including without limitation, any applicable tax regulations.
3.7 Rejection of invoice or payment by the Buyer shall not prejudice any other rights of the Buyer under the Purchase Order.
4. Packing and Marking
4.1 Unless otherwise specifically provided in the Purchase Order, the Contract Price shall be deemed to include all packing, preservation and marking costs. The Goods shall be packed in accordance with good commercial practices to ensure the safety of the Goods against damage, loss or deterioration during handling and transportation from the Seller’s premises to the agreed delivery point.
4.2 Shipping marks and care marks for each package shall clearly be marked in accordance with, with a stencil in characters at least two inches high using emulsion type inorganic paint, on the top and two opposite sides of the package. The shipping marks shall be correlated with all invoices, packing lists, forwarder’s certificate of receipt or bill of lading. Tag marks for each item shall be marked in accordance with Attachment C of the GTC. One (1) copy of relevant packing list shall be placed inside of each case, and one (1) copy shall be fixed on the outside of each case. In addition to the above packing list, two (2) additional copies of all packing lists pertaining to the shipment shall be placed in the case No. 1 of the shipment. All the packing lists shall be inside waterproof envelope.
4.3 Unless otherwise provided in the Purchase Order, pro-forma packing list shall be submitted not later than eight (8) weeks prior to each delivery.
5. Storage Recommendation
5.1 The Seller shall, at the latest two (2) months before the delivery is made, provide and submit proper instructions for storage and preservation which mean special notice like caution and attention to ensure that the quality and guarantee conditions of the Goods are maintained during storage at the Worksite.
6.1 The whole of the Goods (including technical documents) shall be completed and delivered to the delivery point and within the time specified in the Purchase Order. Within (14) days from the date of each delivery of the Goods, the MDR of such Goods shall be submitted to the Buyer from the Seller. Unless otherwise provided in the Purchase Order, the terms of delivery shall be in accordance with the Incoterms 2010
6.2 If it is learned by the Seller that the Goods cannot be delivered within the time specified in the Purchase Order, the Seller shall immediately notify the Buyer in writing. Upon such notice, the Buyer may direct the Works to be accelerated by means of working overtime and adding additional crews or shifts, at the Seller’s own cost, and the Seller shall promptly provide a plan including recommendations for the most effective and economical method of acceleration. If it is proven that the cause of delay is attributable to the Buyer, the Seller is entitled to the payment of the cost for accelerated work or any work instructed by the Buyer. If the cause of such delay is attributable to the Seller, the Seller shall bear the costs for accelerated work and/or shall be liable for liquidated damages under.
6.3 If the Seller is ready to make a delivery of the Goods in accordance with the Purchase Order, but delivery is delayed by any reasons solely attributable to the Buyer, the Seller may effect a delivery to a storage location agreed with the Buyer, or in case of the failure of agreement, to a storage location most appropriate under the circumstances. Delivery to such location shall constitute completion of delivery and relevant payment shall become payable against presentation of warehouse storage certificate and relevant documents. The Buyer shall reimburse the Seller within forty five (45) days from the receipt of the invoice for actual costs of storage only for the storage period exceeding six (6) weeks after the Goods were ready for delivery. Under the situation set forth in this Clause, the title to and risk of loss of the Goods shall be passed to the Buyer from the Seller upon delivery of the Goods to the storage location.
7.1 The Buyer shall carry out unpacking inspection of all the Goods at the time of off-loading or at any other appropriate time.
7.2 The unpacking inspection will be carried out by the Buyer and/or the Buyer’s subcontractor in a manner of contrasting the Goods actually shipped with the packing list prepared by the Seller. Any inconsistency or discrepancy between the Goods actually shipped and the packing list shall be deemed and considered as shortage, loss or excess.
7.3 The Seller may dispatch the Seller's personnel and/or the person of its agent to the Worksite to witness the unpacking inspection and shall notify the Buyer of the Seller's request of said witness by the Seller's personnel and/or the person of its agent to the Worksite for witnessing the unpacking inspection.
7.4 If any shortage, loss and damage are found at the time of unpacking inspection due to the reasons attributable to the Seller, the Seller shall, at its own expense including export packing and transportation costs to the Worksite and import customs duties as promptly as possible, make all repairs, replacements or supplements of the Goods as requested by the Buyer for such shortage, loss and damage irrespective of whether the Seller's personnel and/or the person of its agent witness or do not witness the unpacking inspection.
7.5 Any excess found at the time of unpacking inspection shall not be considered as the substitute for the shortage and loss, and shall not be returned to the Seller. All costs and expenses incurred to and in connection with the dispatch of the Seller's personnel and/or the person of its agent and the witness thereof shall be borne by the Seller.
8. Ownership of Goods
8.1 All Goods shall be delivered to the delivery point described in the Purchase Order otherwise any extra handling charges to transport to the delivery point will be at the Seller’s account. Any damage to the Goods prior to delivery to the Buyer shall be at the Seller’s risk and responsibility and the Buyer shall be entitled to reject the Goods which are damaged on visual inspection at point of delivery. Risk of loss of the Goods shall pass to the Buyer upon delivery as specified in the Purchase Order.
8.2 The Seller shall keep the Goods free from any lien, charges or claims of the Seller or any third party. If required by the Buyer, the Seller shall confirm in writing with the Buyer that the Goods are free from any lien, charges or claims.
9.1 The Buyer may at any time but prior to PAC, by written notice, make changes to the Works, including, but not limited to, changes in quantity, size or capacity, in drawings and Technical Specifications, methods of shipment and packing, performance schedules or place of delivery. Should any change increase or decrease the cost of, or the time required for performance of the Purchase Order, an equitable adjustment shall be made to payment or delivery schedule or both, as the case may be, to be reflected in a written modification of this Purchase Order.
9.2 If any such changes instructed by the Buyer affect the cost and/or schedule of the Works, or the Buyer requests estimates before instruction of any change to the Seller, then the Seller shall prepare and submit to the Buyer fully detailed estimates of schedule or costs etc. related with the change with evidence thereof within two (2) weeks from the Buyer’s instruction of changes, or the Buyer’s request of the estimates.
9.3 The Seller’s estimated cost shall be reasonable and competitive in favor of the Buyer, and the Parties shall negotiate in good faith regarding suitable sums to be applied to the changes. In the event that the Parties are unable to agree on the adjustment of the Contract Price or on any extension of time for completion of the Works, the Buyer shall be entitled to determine the effect on the Contract Price and the time for completion of the Works in such manner as the Buyer may consider appropriate.
9.4 Nothing contained in this Clause shall relieve the Seller from proceeding without delay in performance of the Purchase Order including changes without regard to whether a proper adjustment has yet been made.
1 Extension of Time
1.1 The Seller shall be entitled to request the Buyer for adjustment of time of the delivery of the goods where the need arises.
1.2 In such circumstances, the Seller may request the Buyer to allow adjustment of time of delivery of the goods and the Buyer shall review and determine to increase or decrease the time of the delivery of the goods. The Buyer shall so inform the Seller and the time of delivery may be increased or decreased to the extent the Buyer deems fair and reasonable.
1.3 Failure to reach an agreement on the extension of the time of delivery shall not relive the Seller from proceeding without delay in performance under the Purchase Order regardless of whether a proper adjustment has been made or not.
1.4 Unless the Seller shall give notice to the Buyer within five (5) working days after the Seller became aware or should have become aware of the event mentioned above, the Seller shall not be entitled to make a claim for adjustment of time for completion of the Works.
1.5 Notwithstanding Clause 10 of the GTC, if the Seller is delayed in the execution of the Works by any circumstance or occurrence which entitles the Buyer to an extension of time for completion of the works under the Main Contract, it shall be a condition precedent to the Seller's right to an extension of the time for completion of the Works that the Seller has given timely notice to the Buyer of the circumstances or occurrence which are delaying the Seller so as to allow the Buyer to claim for an extension and in any such case the extension shall not in any event exceed the extension of time which shall be granted to the Buyer under the Main Contract.
2 Quality Control, Inspection and Testing
2.1 The Seller shall follow quality control, inspection and testing procedures in accordance with the Technical Specifications and shall maintain authenticated inspection and test reports, test data, and other relevant documents, which shall be forwarded to the Buyer in the number of copies specified in and in accordance with the schedule of document submission under the Purchase Order.
2.2 Prior to shipment all inspections and tests shall be completed as required under the Supply Agreement. No Goods shall be delivered for shipment until notice is given by the Buyer in writing that the inspections and test results are approved. The Buyer’s approval or comments shall be made within fourteen (14) calendar days upon receipt of the inspection and test reports from the Seller. All inspection and test reports shall contain the followings as minimum information;
a) general statements about the kind of tests
b) technical data of the tested equipment
c) description of the test type and method used
d) description of the evaluation method
e) comparison with the guaranteed values
f) summary and conclusion
2.3 The Buyer shall be entitled to refuse the Goods partially or totally, whether the Goods are delivered on Worksite or not, until all inspection requirements have been met and the required reports and certificates approved by the Buyer are submitted by the Seller. In such case the Seller shall, at its own expense, carry out such repairs, replacements, modifications, inspections, tests and delivery as necessary to have the Goods certified in accordance with the requirements of the Technical Specifications and provide the certificates to the Buyer for approval.
2.4 All fees and charges for arrangement of inspections and tests including the required certificates and documentation shall be deemed to be included in the Contract Price. The Seller shall make no shipment of nonconforming the Goods as an accommodation or otherwise, unless so authorized by the Buyer in writing.
2.5 The Buyer and/or the Client and/or their representatives or agencies have right to inspect the Goods and progress of the Works in relation to the Purchase Order at all reasonable times, at the Seller’s or its vendors’ or subcontractors’ premises. The Seller shall, at its own cost, grant the Buyer and/or the Client and/or their representatives or agencies free access at all reasonable times to the Seller’s or its vendor’s or subcontractor’s office, plants and all other locations where the Goods are manufactured or the Works are performed, for the purpose of carrying out such review, audit, inspection or testing or pre-inspection meeting.
2.6 The Seller shall submit an inspection or test notice to the Buyer in three (3) weeks advance to the inspection or test when and where the Goods are ready for inspection or test and the Buyer has the right to witness at his option such inspection or test. The inspection or test notice shall describe the factory inspection or test to be performed and contain the following;
a) Seller’s name (manufacturer’s)
b) tag number and/or equipment/component name
c) type of test
d) brief description of plant location to be inspected/tested (city/ country)
e) date of test
f) approved drawings/documents (incl. respective procedures for planned FAT’s)
g) standards/codes to be used
h) coordinator name/ Tel. number of the Seller
2.7 In case where the inspection or test shall be witnessed by the Client, the Seller shall submit respective inspection or test notice to the Buyer in four (4) weeks advance to the expected date of inspection or test.
2.8 The Buyer or the Client shall be permitted to attend and participate in all such factory inspections or tests. If the Buyer or the Client’s representative attends the test, the Seller shall provide the results of such test to the Buyer within seven (7) days from the completion of each such test. If the Buyer’s representative does not attend the test, the successful completion of such test shall be determined by the Seller’s test certificate to be provided by the Seller to the Buyer within fifteen (15) days of the test completion date. Successful completion of such test shall be a pre-condition to shipment of the tested item.
2.9 Shipment of the Goods shall not relieve the Seller of any responsibility, warranty or guarantee as stated under the Supply Agreement. Review and/or approval of inspection, tests or certificates by the Buyer shall not constitute a waiver of any rights under the Purchase Order including field performance requirements and shall not release the Seller from any of its obligations under the Supply Agreement. Shop inspection by the Buyer shall not relieve the Seller of any responsibilities in case of discovery of defective Goods of workmanship or malfunction during the Warranty Period. Notwithstanding the acceptance of the Goods by the Buyer, the Seller shall be solely and fully responsible for the quality and fitness for the purpose of the Goods in accordance with the Supply Agreement.
2.10 The Buyer has the right to order to carry out special tests in addition to those required in the Supply Agreement. Unless otherwise provided in the Supply Agreement, such additional tests shall be in accordance with the requirements of applicable codes and the testing shall be done by authorized party or procedures approved by the Buyer. The type and number of such witnessing and testing, in addition to those required under the Supply Agreement, shall be determined solely by the Buyer. The actual costs of such additional tests shall be reimbursed to the Seller by the Buyer unless the tested Goods are proven to be defective. The costs and expenses for Seller’s Representative, if any, shall be borne by the Seller. All the provisions contained in this Clause shall be extended to cover subcontractors and vendors employed or retained by the Seller.
2.11 The Seller shall provide safe and convenient facilities and equipment for such inspection and tests and shall furnish all necessary samples, drawing lists and documents. If the Buyer finds that conditions are unsafe for inspection and tests at a particular location, it may, upon notice to the Seller, refuse to inspect or test until such conditions are corrected.
2.12 Notwithstanding any other provision in the Supply Agreement, if the Buyer finds the defects, shortage, loss or damage of the Goods after delivery due to the reasons not attributable to the Buyer, the Buyer reserves the right to refuse acceptance of the Goods. In such circumstances, the Seller shall, upon request by the Buyer, carry out repairs, replacements, modifications, inspections or tests as necessary to have the Goods certified in accordance with the requirements of the Technical Specifications. In such circumstances, the date of repairs, replacements, modifications, inspections or tests, whichever is later, shall be the date of delivery of the Goods.
3 Liquidated Damages
3.1 The delivery date of the Goods (other than the Vendor Data) shall be as categorized and provided in the Supply Agreement. If the Seller fails to deliver any of the Goods (other than the Vendor Data) categorized in the Purchase Order without any defects within the delivery date specified in the Purchase Order including failure to pass any inspection or test before shipment due to the reasons not attributable to the Buyer, the Buyer shall be entitled to delay liquidated damages for late delivery of Goods (other than the Vendor Data) from the Seller, not as a penalty, calculated at the rate of zero point one percent (0.1%) of the amount of category which the delayed Goods (other than the Vendor Data) belong to per day of delay, provided that such liquidated damages in total shall not exceed ten percent (10%) of the Contract Price.
3.2 If the Seller fails to submit the required Vendor Data within the schedule set forth in this Purchase Orderdue to causes not attributable to the Buyer, the Buyer shall be entitled to delay liquidated damages for late delivery of Vendor Data from the Seller, not as a penalty, calculatedat the rate of zero point zero one percent (0.01%) of the Contract Price per day of delay, provided that such Liquidated Damages in total shall not exceed five percent (5%) of the Contract Price.
3.3 The maximum aggregate amount of delay liquidated damages payable by the Seller to the Buyer under Clauses 12.1, and 12.2 above shall not exceed an amount equal to fifteen percent (15%) of the Contract Price.
3.4 The Buyer may, without prejudice to any other method of recovery, deduct the amount of such liquidated damages from any monies due or which may become due to the Seller. The payment or deduction of such liquidated damages, whether paid or deducted, shall not relieve the Seller from the obligation to complete the Works and shall be without prejudice to any other contractual or legal rights and remedies the Buyer is entitled to for such delay.
3.5 In the event that all or any of the obligations of the Seller under the Purchase Orderto pay liquidated damages are held to be unenforceable, the Seller shall pay the Buyer damages in respect of all actual losses suffered by the Buyer due to the circumstances in respect of which liquidated damages would have been payable if the relevant obligation had been enforceable including, without limitation, loss of profit, loss of use, loss of revenues, loss of production and loss of savings and any increased financing costs.
4 Expediting and Progress Report
4.1 The Seller shall deliver the Goods to such place and at such time as specified in the Supply Agreement. The Seller shall, if required by the Buyer, expedite delivery of the Goods and shall issue, where applicable, drawings, data and other description in accordance with the names of documents and time of issuance as specified in the Supply Agreement.
4.2 Within four (4) weeks from the Effective Date or the Buyer's written notice to proceed, the Seller shall issue a detail manufacturing schedule with detail drawing schedule, followed by a progress report by the end of each month, of which cutoff date is 25th of the month in principle. Such manufacturing schedule and monthly progress reports shall include the information listed below:
a) Status of deliveries of materials purchased by the Seller from its sub-vendor and/or sub-supplier, if any;
b) The progress of engineering work which includes the Seller's estimate of the percentage of engineering work completed;
c) The progress of manufacturing work which includes details of the work completed and the work not yet completed, with the Seller's estimate of the percentage of manufacturing work completed;
d) Digital photos for manufacturing milestones of the Goods; and
e) Updated manufacturing schedule.
4.3 When the Buyer considers progress of the Works behind the schedule, the Seller shall, at its cost and expense, expedite its duties under the Purchase Order in a manner prescribed or proposed by the Buyer. The Buyer, the Client and/or their agents shall be granted access to any and all parts of the Seller's works, its sub-vendor's and/or its sub-supplier's or, if applicable and at reasonable times, their offices and/or works engaged in the manufacturing or supply of the Goods or performance of the Supply Agreement.
4.4 Un-priced copies of the Seller's contracts or purchase orders to the sub-vendor's and/or sub-suppliers and/or the subcontractors of equipment or materials for this Purchase Order shall be made available to the Buyer, the Client and/or their agents when requested.
5.1 Unless otherwise expressly provided for in the Purchase Order and without prejudice to any specific requirement under the Purchase Order, whenever the Main Contract provides for the furnishing of bank guarantees by the Buyer, the Seller shall, in respect of the Works, furnish to the Buyer such bank guarantees in the same form and percentage as those to be furnished by the Buyer to the Client or some other amount to be mutually agreed between the Buyer and the Seller.
5.2 All costs and expenses incurred by the Seller in furnishing, extending, amending and/or canceling any guarantees shall be borne by the Seller.
5.3 The amount of guarantees shall in no way be construed as a limitation of the Seller's liability and responsibility under the Purchase Order and shall in no way prevent the Buyer from claiming indemnification for damages suffered by it which may exceed the amount of guarantees.
5.4 If the Buyer shall make an advance payment under the Supply Agreement, the Seller shall at its own expense submit an advance payment bond together with the Seller’s invoice for the advance payment in the form of Attachment B of the GTC issued by the first class international bank acceptable to the Buyer, in the amount equivalent to the amount of the advance payment to be paid by the Buyer as set out in the Supply Agreement. Unless otherwise specified in the Supply Agreement, this advance payment bond shall become effective from the date of the advance payment and remain in full force until one (1) month after last delivery date of the Goods.
5.5 If the terms of the advance payment bond specify its expiry date and the relevant delivery of the Goods has not been completed by the date one (1) month prior to the expiry date of the advance payment bond, the Seller shall extend the validity of the advance payment bond until as required under this Clause.
5.6 Unless specifically agreed to the contrary, the Seller shall, at his expense and within twenty (20) days after Effective Date, submit a performance bond in the form of Attachment A of the GTC issued by the first class international bank acceptable to the Buyer in the amount equivalent to ten percent (10%) of the Contract Price. The performance bond shall become effective from the date of issuance thereof and remain enforceable until one (1) month after the expiry date of the Warranty Period under the Supply Agreement.
5.7 If the terms of the performance bond specify its expiry date, and the Warranty Period under the Purchase Order has not expired by the time one (1) month prior to the expiry date of the bond, the Seller shall extend the validity of the performance bond until the time one (1) month after the expiry date of Warranty Period.
6.1 If the whole or part of the Works is suspended by the Client for any reason beyond the Buyer's control, due to reasons including, but not limited to, a Force Majeure and if the Seller suffers delay and/or incurs cost due to such suspension, then the Seller shall be entitled to claim for an extension of time under Clause 10.1 and/or additional payment under Clause 18.1. For the avoidance of doubt, the Seller shall not be entitled to extension of time and any additional payment in any case of suspension as a result of the act, omission, negligence or willful misconduct of the Seller or as a result of a breach of the Purchase Order by the Seller.
6.2 Without prejudice to the above, the Buyer may at any time at its convenience suspend the execution of the whole or part of Works by issuing a written notice to the Seller. Such notice shall specify the obligation of which performance is to be suspended, the effective date of the suspension and the reasons thereof. On receipt of such notice the Seller shall forthwith cease the execution of the suspended portion of the Works and shall during such suspension:
a) properly protect and secure the Works against any deterioration, loss or damage;
b) place no further subcontracts or purchase orders with respect to those parts of the Works suspended except to the extent expressly requested or agreed by the Buyer; and
c) use all reasonable endeavors to suspend on the most favorable terms available to the Seller all purchase orders, subcontracts and rental agreements to the extent affected by such suspension and otherwise minimize the additional costs associated with such suspension.
6.3 During such suspension pursuant to Clause 15.2 hereof and if the Seller suffers delay and/or incurs cost due to such suspension, then the Seller shall be entitled to claim for an extension of time under Clause 10 and/or additional payment under Clause 18.2, provided however that no payment will be due if the suspension is:
a) otherwise provided for in the Supply Agreement;
b) necessary by the reason of any negligent act or omission or breach of the Purchase Orderby the Seller;
6.4 After receipt of an instruction to resume the suspended Works, the Seller shall, after due notice to the Buyer, examine the Works affected by the suspension. The Seller shall make good any deterioration or defect in, or damage to or loss of the Works that may have occurred during the suspension. The Seller shall not be entitled to payment for costs incurred in making good any deterioration, defect, damage or loss caused by faulty workmanship or materials or by the Seller’s failure to take the measures specified in Clause 15.2.
7.1 The Buyer may terminate the Purchase Order or any part thereof, with giving twenty (20) days’ notice to the Seller, if
a) the Seller is adjudged bankrupt, or makes a general assignment for the benefit of creditors, or if a receiver is appointed for the benefit of its creditors, or if a receiver is appointed on account of its insolvency (in this case the Purchase Order shall be immediately terminated without giving the above mentioned period of twenty (20) days);
b) the Liquidated Damagesfor any late delivery of the Goods has reached its maximum;
c) the Client rejects the Goods for the reasons of failing to achieve the guaranteed performance; or
d) the Seller fails to comply with any of material provisions of the Supply Agreement.
7.2 In the event of termination under this Clause 16.1, the Buyer may execute Purchase Order with any other suppliers and shall be entitled to cover the difference between the Contract Price and all of the costs and expenses incurred by the Buyer to complete the purpose of the Supply Agreement.
7.3 The Seller may, by delivery to the Buyer of a written notice of termination, terminate the Supply Agreement, if the Buyer is adjudged a bankrupt, or makes a general assignment for the benefit of creditors, or if a receiver is appointed for the benefit of its creditors, or if a receiver is appointed on account of its insolvency
7.4 In the event of termination of the Main Contract for the Project due to the reasons attributable to the Seller, the Seller shall be responsible for such termination and all of the costs and expenses incurred by the Buyer due to such termination.
7.5 The Buyer may, at its own convenience, terminate the Purchase Order at any time by giving a written notice of such termination.
7.6 Such notice of termination shall specify the extent to which execution of the Works under the Purchase Order is terminated, and the date upon which such termination becomes effective.
7.7 On the date the termination becomes effective in accordance with Clause 16.1, 16.5, the Seller shall:
a) stop the Works to the extent specified in the notice of termination;
b) place no further order nor procure any service other than that as may be necessary or required for completion of such portion of the Works under the Purchase Order that is not terminated;
c) take all steps that are reasonably necessary to resolve or settle outstanding liabilities and claims arising out of orders which have been placed with the prior approval of the Buyer, or assign to the Buyer as requested all of the rights, titles and interests of the Seller under any such orders;
d) if requested in writing by the Buyer, advise the Buyer regarding maintenance, protection or storage of the Goods belonging to the Buyer or passed to the Buyer under the terms of the Supply Agreement;
e) submit to the Buyer a certified list of deliverable items of any or all items of the terminated supply;
f) continue to complete the Works in accordance with the Purchase Order which has not been terminated, if applicable; and
g) within thirty (30) days, deliver all the information, drawings including original and copies, specifications, calculations, program listings, erection plans, schedules software and all other data or documents prepared and/or provided by the Seller or any sub-vendor.
7.8 In case of termination in accordance with Clauses 16.1 or 16.5, the Seller shall be entitled to receive payment only for the amounts due and not previously paid to the Seller for the Works performed under the Purchase Orderas of the effective date of termination.
7.9 In the event that the Seller has received payments which exceed the amount of Seller’s entitlement hereunder, the Seller shall reimburse the Buyer with exceeding amount in the same currency specified in the Purchase Order within fourteen (14) days from the date on which the Buyer and the Seller have agreed on the amount to which the Seller is entitled hereunder.
7.10 The Seller shall use its best efforts to minimize and mitigate losses, damages, costs and expenses incurred as a result of termination of whole or any part of the Purchase Order pursuant to the Clause 16.
7.11 The Seller agrees that in case of termination of the Main Contract, the Purchase Order shall be assigned to the Client to the extent desired by the Client.
8.1 The Seller hereby expressly warrants that the Goods shall be new, unused, and free from defects in design, material and workmanship and conform to the Technical Specifications. If required by the Buyer, the Seller shall furnish satisfactory evidence as to the kind and quality of all Goods furnished hereunder.
8.2 The Warranty Period shall remain in effect for a period of 40 months from the final delivery of the Goods.
8.3 During the Warranty Period, all Goods found nonconforming or defective as to design, material, workmanship, shall be repaired or replaced by the Seller as ordered by the Buyer in accordance with the Technical Specifications at the Seller’s costs and expenses. Notwithstanding the foregoing, the Seller shall not be responsible for defects in the Goods arising out of or resulting from any of the following causes: (i) improper operation or maintenance thereof by the Buyer or third parties; (ii) erosion or corrosion attributable to the Buyer, and (iii) normal wear and tear.
8.4 In the event the Seller fails to start to repair or replace the defective or nonconforming Goods within fourteen (14) days after notice by the Buyer, unless otherwise agreed by the Buyer, the Buyer may repair such Goods at the Seller’s costs, expenses and risks.
8.5 The Buyer shall not be required to return defective or nonconforming Goods prior to replacement, and the Seller agrees to accept the Buyer’s report of defect or nonconformity with respect to such Goods, but the Seller may have an opportunity to verify the defect or nonconformity. If the Goods are returned to the Seller, all costs associated with returning the Goods shall be borne by the Seller.
8.6 The Warranty Period for the remedied or replaced part(s) shall be extended by twenty four (24) months from the date the replacement or repair is completed.
8.7 The Seller shall hold harmless and indemnity the Buyer from and against all of the costs, losses, or claims arising from or as a result of defect of the Goods attributable to the Seller.
9.1 Any claims, changes and adjustments raised by the Seller whose issue rests with the Client shall only be considered and/or accepted by the Buyer when they are considered and/or accepted by the Client. Such claims, changes and adjustments shall be settled in accordance with the Purchase Orderonly when the Buyer has received extension of time or additional payment in respect thereof under the Main Contract from the Client.
9.2 It shall be a condition precedent for the Seller’s entitlement to an extension of time for completion or additional payment that whenever the Main Contract requires the Buyer to submit any documents, notices or information within a specific time, the Seller shall submit to the Buyer the aforesaid documents, notices or information, as applicable to the performance of the Supply Agreement, sufficiently in advance, so as to allow the Buyer to duly and timely perform its own obligations and enforce its own rights under the Main Contract.
9.3 Notwithstanding any other provision in this Supply Agreement, if the Seller raises any claims, changes and adjustments whose issue does not rest with the Client, and if the Seller intends to claim additional payment to which the Seller is in its opinion entitled under the Purchase Order in addition to the Contract Price, the Seller shall notify the Buyer within five (5) days after the date on which the Seller became aware or should have become aware of the event giving rise to the claim.
9.4 If the Seller fails to notify the Buyer within the time stated in this Clause, the Seller shall be precluded from bringing such claim. Within further five (5) days after giving of the claim notice, the Seller shall establish, to the Buyer's satisfaction, the basis of the claim under the Purchase Order and the detailed amount of the claim with supporting particulars. The Seller shall keep and maintain full records relating to and necessary to support the claim.
9.5 Subject to the Seller’s timely notice, the Buyer shall consult with the Seller in an endeavor to reach agreement for such claim. If agreement is not achieved, the Buyer shall make a fair determination in accordance with the Supply Agreement, taking due regard of all relevant circumstances.
9.6 The Buyer shall give notice to the Seller of each agreement or determination, with supporting particulars. Each Party shall give effect to each agreement or determination, unless the Seller gives notice, to the Buyer, of his dissatisfaction with a determination within five (5) days of receiving it. Either Party may then refer the dispute to the arbitration in accordance with the Supply Agreement.
10 Force Majeure
10.1 Any event of Force Majeure shall not give rise to the Seller’s entitlement to extension of time for completion from the Buyer, save where and to the extent that time for completion has been extended by the Client on the Seller's behalf, in respect of the Works.
10.3 Notwithstanding the foregoing, the Force Majeure shall not include:
a) any labor dispute other than general strikes (unless such general strikes are invoked by the Subcontractor’s or its subcontractors’ or vendors’ employees);
b) mechanical breakdown of whatsoever kind not itself resulting from any Force Majeure;
c) shortage of labor, equipment, materials or utilities ;
d) inclement or adverse weather;
e) any event or circumstances that make performance by a party uneconomical or commercially impracticable; or
f) any act or omission or default on the part of the Seller, its subcontractors or vendors (whether actual or potential).
10.4 If a Party is or will be prevented from performing any of its obligations under the Purchase Orderby Force Majeure, then it shall give notice to the other party of the event or circumstances constituting the Force Majeure and shall specify the obligations, the performance of which is or will be prevented. If the Force Majeure occurs or is likely to occur to the Seller, the notice shall be given within 10 days after the Party became aware, or should have become aware, of the relevant event or circumstance constituting the Force Majeure.
10.5 If notice of the Force Majeure is not given within the required times under Clause 19.4, the affected Party shall not be relieved from performance of the relevant obligations.
10.6 The affected Party, in the case of the Seller, shall ensure that its sub-contractor or sub-vendors shall, use all reasonable endeavours to mitigate the adverse consequences of the Force Majeure.
10.7 Subject to the affected Party complying with its obligations under the Clause 19.4 (i) the affected Party shall have no liability for failing to perform any obligation to the extent that such performance is wholly or partly prevented by the Force Majeure; and (ii) where a time for performance of any obligation is specified in this Supply Agreement, the affected Party shall be entitled to additional time for performance of such obligation to the extent granted by the Client provided that the Seller shall not be entitled to additional time pursuant to this Clause if or to the extent that such failure or delay would nevertheless have been experienced by the Seller had the Force Majeure not occurred.
10.8 Upon cessation of Force Majeure and after discussion with the Buyer, the Seller shall prepare a revised schedule of the performance of the Works so as to minimise the effects of the delay and having made due allowance for any instruction to accelerate the performance of the Purchase Order in accordance with the provisions for changes.
10.9 Notwithstanding the foregoing, no compensation for any costs and expenses shall be made in respect of a Force Majeure.
11.1 The Seller shall indemnify, defend, and hold the Buyer harmless from any and all claims, liabilities, damages, losses, settlements and expenses, including attorney’s fees, for injuries to, or death of, any and all persons, and for loss of or damage to any property in connection with the performance of the Works under the Supply Agreement.
11.2 The Seller shall indemnify, defend and hold harmless the Buyer and its affiliates and other subcontractors (other than the Seller, its employees, agents, subcontractors and affiliates) and its or their respective shareholders, directors, officers or employees (collectively the “Buyer Parties”) from and against all liabilities of and/or claims made against or suffered by the Buyer or any of the Buyer Parties if it is proven that the damage has been caused or contributed by an act or omission of the Seller or the Seller’s subcontractor or vendor.
11.3 The Seller hereby covenants that he has received specific consideration for assuming this obligation by the award of the Purchase Order and by agreement to the Contract Price which was submitted in cognition of this and all other obligations assumed by the Seller hereunder. The provisions of this paragraph shall survive completion, termination, or cancellation of the Supply Agreement.
12 Limitations of Liabilities
12.1 To the extent permitted by applicable laws, neither Party shall be liable to the other Party for any loss of profit, loss of production, loss of use and/or losses which are indirect, special or punitive that may be suffered by the other Party, whether caused by breach of contract, breach of statutory duty, strict liability, tort (including negligence) or otherwise, except:
a) liability of the Seller under indemnities under Clause 20;
b) the liability of the Seller to pay liquidated damages;
c) liability of the Seller to pay damages payable in lieu of liquidated damages in accordance with Clause 12.5;
d) the amount of any costs or losses incurred by the Buyer for which the Seller is expressly required to reimburse the Buyer under the terms of the Supply Agreement; and
e) the liability of the Seller arising out of gross negligence, willful misconduct, and/or fraud.
12.2 Subject to Clause 21.3, the aggregate liability of the Seller to the Buyer, whether such liability arises out of contract, tort (including negligence), strict liability or otherwise, shall not exceed an amount equal to one hundred percent (100%) of the Contract Price. The Seller’s limitation on liability shall not in any way limit the Seller’s responsibility to expend such money as may be required to perform the Works in accordance with the Supply Agreement, including to complete the Works within the time for completion.
12.3 The limitations of liability set out in Clause 21.2 shall not apply to:
a) any liability arising out of any gross negligence, willful misconduct or fraud by or on the part of the Seller;
b) any liability of the Seller under indemnities under Clause 20;
c) any liability of the Seller to the extent that such liability is covered by insurance required to be maintained by the Seller under the Supply Agreement, or would have been but for an act or omission of, or breach of the Purchase Orderby the Seller; or
d) Any liability of the Seller under the indemnities in Clauses 22.1, 23.1, 23.5 and 29.6.
13 Intellectual Property Rights
13.1 The Seller shall indemnify and hold harmless the Buyer against any claims, liabilities, damages, losses, settlements and expenses including attorney’s fees, sustained by reason of infringement of any patent, trademark, trade secret, copyright or similar right with respect to the Works.The Seller shall at its own expense, defend all claims, suits and actions against the Buyer, its agents in which such infringement or claim is alleged.
13.2 The Seller grants to the Buyer an irrevocable, perpetual, transferable, non-exclusive, world-wide, royalty-free license to copy and use and to sub-license in favor of the Client and/or the Buyer’s other subcontractors, any of the Seller Intellectual Property Rights solely for purposes connected with exercising its rights or performing its obligations for the Project or constructing, completing, reconstructing, operating, maintaining, repairing, adjusting, dismantling, re-assembling, modifying, extending the Project and/or the Works.
14 Rules, Regulations, and Taxes
14.1 The Seller shall defend, indemnify and hold harmless the Buyer and the Client against any claim, additional cost or liability and/or penalty that may be imposed on the Buyer and/or the Client by reason of any alleged violation of the provisions of the Law by the Seller and (if any) any of its subcontractors, vendors, agents, servant or workers.
14.2 During the performance of the Works, the Seller shall strictly observe and be bound by all applicable statutes, laws, bylaws, ordinances, rules, regulations, and other statutory provisions including the laws of the countries where the Works are performed. The Seller shall procure and pay for all permits, license and inspections required by any governmental authorities for the performance of the Works.
14.3 Without prejudice to the generality of the foregoing provisions of Clause 23, the Seller's obligations in this connection shall extend to complying with and implementing the Buyer's and/or the Client's own health, safety and environmental regulations as identified to the Seller by or through the Buyer from time to time and to complying with the requirements of the Client's corporate health, safety and environment management system.
14.4 The Seller shall bear and make payment of any and all necessary license, fees, taxes, duties and levies applicable to the Seller and its personnel and equipment which may be imposed by any country or authority in connection with the Seller's activities or Works under the Supply Agreement. All taxes shall be filed and paid by the Seller, in due time, to the relevant authority in conformity with the applicable laws and regulations. Such payments and provisions are deemed to be included in the Contract Price.
14.5 The Seller shall defend, indemnify and hold harmless the Buyer and the Client from any and all taxes, duties, levies and charges of whatsoever assessed or levied by the authorities of the country of the Worksite or other countries against the Seller, or against the Buyer and/or the Client for or on account of any payment made to or any income earned by the Seller under the Supply Agreement. The Seller shall, if so required, give evidence to the Buyer the payment of the taxes.
15 Technical Service
The Seller shall dispatch suitably qualified engineer(s), at the Buyer’s option, for erection, installation, commissioning and site tests (if required) of the Goods at the Worksite in accordance with Attachment E of the GTC. The number and discipline of engineer(s), the period of stay at Worksite and number of round trips shall be recommended by the Seller and agreed by the Buyer in writing.
16 Assignment and Subcontracting
16.1 The Seller shall not subcontract any portion of the Works without the Buyer's prior written consent. Such consent shall not relieve the Seller of any of its duties, obligation, warranties, liabilities or responsibilities for the performance of the Supply Agreement. The Seller shall be responsible for the acts, omissions, defaults and negligence of (if any) its subcontractors, vendors, agent, servants, or workers as fully as if they were the acts, omissions, defaults or negligence of the Seller. The Seller shall furnish such information relative to (if any) its subcontracts and purchase orders as the Buyer may reasonably request. No subcontracts and purchase orders shall bind or purport to bind the Buyer or the Client.
16.2 Any assignment of the Supply Agreement, or any interest therein, or any monies due or to become due to the Seller hereunder, without the Buyer's written consent, shall be void.
16.3 The Buyer may, without the consent of the Seller, assign the Purchase Orderin whole or in part to any party.
16.4 By an appropriate written agreement, the Seller shall require (if any) its sellers and vendors, to the extent that any part of the Works is to be performed by (if any) sellers and vendors, to be bound to the Seller in respect of all terms and conditions of the Supply Agreement. The Seller shall, upon request by the Buyer, provide a full copy of the contract document with (if any) its subcontractors and vendors (except price information) as evidence that the foregoing provisions are duly included therein.
The Seller shall, at its cost and expense, subscribe the insurance policies within fourteen (14) days from the date of the Effective Date to cover its liabilities and responsibilities under the Supply Agreement. The Seller shall at all times maintain such insurance from the Effective Date until the Warranty Period and the coverage of the insurance policies approved by the Contractor.
18 Dispute and Arbitration
18.1 All disputes arising out of or relating to the Purchase Orderor breach thereof which cannot be settled amicably shall be finally settled by arbitration in accordance with the rules of conciliation and arbitration (the “Rules”) of the International Chamber of Commerce (the “ICC”) then obtaining, by a panel of three arbitrators. Each party shall have the right to nominate one arbitrator in accordance with the Rules, and the third arbitrator shall be appointed by the Rules. The arbitration seat shall be in Nigeria and the language of the arbitration shall be English.
18.2 The decision rendered by the arbitrators shall be confidential, final and binding on both Parties, and judgment upon the award rendered (excluding the motives of the judgment) may be entered in any court having jurisdiction or application may be made to such court for a judicial acceptance of the award and/or an order of enforcement as the case may be.
This Contract shall be governed by the laws of Nigeria as a Contract made in Nigeria and the Buyer herby submits to the exclusive jurisdiction of the Nigeria courts.