Purchase Order Terms and Conditions

1. DEFINITIONS

Unless specifically stated otherwise, the following terms shall have the meaning defined in these Purchase Order Terms and Conditions (“Terms and Conditions”) and shall be used for the purpose of interpreting the Purchase Order, the Purchase Order Documents and these Terms and Conditions.

“Change Order” shall mean a written amendment to the Purchase Order Documents signed by the Parties stating their agreement upon (i) a change in the Project, (ii) a change in the Work, (iii) a change in the Price, and/or (iv) a change in the time of performance of the Work.

“Dangerous Goods” shall have the meaning ascribed to that term under the Transportation of Dangerous Goods Act (Canada), or the equivalent in any other relevant legislation.

“Delivery Point” shall mean the place nominated in the Purchase Order for delivery of the goods or equipment.

“Disputes” shall have the meaning ascribed to that term in Clause 35hereof.

“Incoterms (2020)” shall mean the pre-defined commercial terms published by the International Chamber of Commerce (ICC) that specify the responsibility and risks of both Purchaser and Vendor while the goods or equipment is in transit.

“Intellectual Property Rights” shall mean any patent, registered design, trademark or name, copyright or other protected intellectual property right.

“Equipment” shall mean all collectively the goods including construction materials and any and all other parts that are listed or referenced in the Purchase Order Documents to be supplied by Vendor for incorporation into the Work (except such goods that are by express provision in the Purchase Order Documents to be provided by Purchaser or others) including, without limitation, all additions, replacements, spare parts, accessories, apparatus, equipment, machinery, piping, ducts, conduits, instruments, structural components, siding and roofing materials, concrete, masonry, equipment, fasteners, and hardware, finishes, and permanent facilities and as and to the extent stated in the Purchase Order Documents and any other materials whether or not specifically mentioned in the Purchase Order Documents that are necessary to complete the equipment for heat, light, power and other required utilities in accordance with the Purchase Order Documents.

“Material Safety Data Sheets” shall mean the written document that discloses prescribed information required under the Hazardous Products Act (Canada).

“Parties” shall mean Vendor and Purchaser, collectively and “Party” shall mean either of them.

“Price” shall mean the compensation defined in the Purchase Order Documents to be paid by Purchaser to Vendor against the supply of the Work as described in the Purchase Order Documents, as may be adjusted by Change Order.

“Project” shall mean the total construction and other work contemplated by Purchaser of which the Work may be whole or part of.

“Purchaser” shall mean Mangrove Water Technologies Ltd. a corporation existing under the Canada Business Corporations Act, having its head office in the Vancouver, British Columbia, Canada.

“Purchase Order” shall mean the accompanying purchase order, accepted quotation or other document evidencing the Purchaser’s agreement to purchase goods or services from the Vendor subject to these terms and conditions.

“Purchase Order Documents” shall mean the collection of written materials that encompasses the agreement between the Purchase and Vendor, including the Purchase Order and any mutually agreed upon amendments thereto, these Terms and Conditions, and any specifications, drawings (including any 3D models, drawings and any other documents necessary for the erection and build of the Work, the whole drafted in the English language) and such other documents as may be listed in the Purchase Order, including amendments thereto before execution of the Purchase Order and subsequent amendments thereto made pursuant to the provision of the Purchase Order and agreed upon between the parties.

“Site” shall mean the location or locations of the Project, as specified in the Purchase Order.

“Sub-contractor” shall mean any person to whom Vendor contracts any portion of the Work or any person to whom a Sub-contractor contracts any portion of the Work and “Sub-contract” shall mean the contract in whatever form it may take (including purchase orders) which governs the relationship between Vendor and Sub-contractor or between Sub-contractor and its Sub-contractor.

“Sub-vendor” shall mean any person from whom Vendor contracts to purchase any portion of the Work or any person to whom a Sub-vendor contracts any portion of the Work and “Sub-contract” shall mean the contract in whatever form it may take (including purchase orders) which governs the relationship between Vendor and Sub-vendor or between Sub-vendor and its Sub-vendor.

“Vendor” shall mean the Party identified as the supplier of the Work as described in the Purchase Order.

“Vendor’s Background IP” shall mean the Intellectual Property rights owned or licensed to Vendor (including know-how and technical information) which exists prior to the date of the Purchase Order or is developed or acquired by Vendor independently of the Purchase Order which is used by Vendor in performance of the Work under the Purchase Order.

“Work” shall mean the Equipment, work or services required to be supplied or performed by Vendor as described in the Purchase Order including goods, work or services that may not be specifically mentioned in such description but which are properly inferable therefrom, and any change in the Work authorized pursuant to the provisions hereof and any other work that is elsewhere herein specifically included in the Work, and may include without limitation design, manufacture, fabrication, supply, testing, project management, transportation, installation support and commissioning support.

2. ORDER OF PRECEDENCE.

Subject to Clause 16 titled “Liens”, in the event of conflict between provisions appearing on the face of the Purchase Order and these Terms and Conditions, the former shall prevail and take precedence over the latter.

3. COMPLETE AGREEMENT.

The Purchase Order Documents constitute the sole and entire agreement between the Parties with respect to the subject matter thereof. No other terms or conditions shall be binding upon the Parties unless accepted by them in writing. The Purchase Order Documents can be amended only by a formal written amendment signed by an authorized representative of Vendor and Purchaser’s authorized representative. Notwithstanding any rule of law to the contrary, the Purchase Order Documents cannot be amended (and otherwise shall not be deemed by any court or arbitrator to have been amended) orally, by informal writings, by conduct, by waiver or by any combination of the foregoing. Notwithstanding the foregoing, any confidentiality agreement or non-disclosure agreement between the Parties shall remain in full force and effect in addition to any confidentiality provisions set forth herein.

4. ACCEPTANCE OF PURCHASE ORDER.

These Terms and Conditions and any additional provision appearing on the face of the Purchase Order shall be deemed to supersede and replace all terms and conditions of any previous tender or proposal. Acceptance of the Purchase Order constitutes agreement with these Terms and Conditions and any additional provision appearing on the face of the Purchase Order. Acknowledgement of the Purchase Order by Vendor with changes to the Purchase Order, including these Terms and Conditions, shall constitute a counteroffer and shall be of no effect until accepted in writing by Purchaser. Omission by Purchaser to accept or to respond to such counteroffer, or acceptance of any partial performance in respect thereof shall not be deemed to be evidence of acceptance of any counteroffer by Purchaser. Performance by Vendor shall be deemed to constitute acceptance of the Purchase Order in the form delivered to Vendor. Where a form of Purchase Order provided by Purchaser contemplates signatures by the Vendor and the Purchaser, the Purchase Order will not be binding until it is duly signed and delivered by representatives of each Party.

5. HEADINGS NOT PART OF PURCHASE ORDER.

Any headings preceding the text of the several Clauses hereof are inserted solely for convenience of reference and shall not constitute a part hereof nor shall they affect the meaning or content hereof, or affect or be referred to in any interpretation hereof.

6. DRAWINGS, SPECIFICATIONS AND REPORTS.

Vendor shall furnish all engineering and other data specified in the Purchase Order Documents (including comprehensive and legible 3D models, drawings and any other documents necessary for the erection and build of the Work, the whole drafted in the English language) for delivery to Purchaser within the time stated in the Purchase Order Document. Design or progress reviews may be conducted at any reasonable time by Purchaser at either Vendor’s premises or at the premises of any Sub-vendor or Sub-contractor or at Purchaser’s premises.

The review and endorsement of drawings and data by Purchaser is for general conformance to the Purchase Order’s requirements only and shall not alter Vendor’s responsibilities for full compliance with the Purchase Order.

7. SUSPENSION OF WORK.

Purchaser shall be entitled, at any time, to suspend the performance of the Work, in whole or in part. Such suspension shall be exercised upon written notice by Purchaser to Vendor specifying the effective date of the suspension, its scope and duration, if it is known at such time. Vendor shall then cease performance of the Work in accordance with the instructions of Purchaser.

As a result, all activities and all expenses in connection with the Purchase Order shall be suspended. Should certain activities or expenses, in Vendor’s opinion, be required to be reasonably maintained or completed, Vendor shall notify Purchaser thereof in writing in order to obtain Purchaser’s prior authorization.

8. TERMINATION OF PURCHASE ORDER.

Purchaser shall have the unconditional right to terminate the Purchase Order, either with or without cause, by notice in writing to Vendor in which event Purchaser shall indemnify Vendor for any reasonable costs incurred by reason of the termination of the Purchase Order from the date of notice of termination to the date of termination which Vendor is unable with reasonable effort to recover.

Upon termination of this Purchaser Order, Purchaser shall have the right to any Equipment acquired by Vendor for purposes of the Purchase Order and to any Work done including goods manufactured to date of termination, which Vendor shall deliver on Purchaser’s instructions. Upon delivery of such Equipment and Work including manufactured goods, Purchaser shall make payment to Vendor for:

a. the proportion of the Price equal to the proportion of the Work completed as of the date of termination (based on value); and

b. agreed upon reasonable costs incurred by reason of the termination of the Purchase Order from the date of notice of cancellation to the date of cancellation which Vendor is unable with reasonable effort to recover.

Subject to Clause 34 titled “Force Majeure”, in the event that Purchaser is prevented for reasons beyond its reasonable control, including without limitation to events such as strikes or other labour problems or occurrences of a Force Majeure nature, from proceeding with the Project for which the Work is to be provided hereunder have been carried out or procured, Purchaser may terminate the Purchase Order.

9. TRANSFER OF TITLE AND RISK.

The risk of loss or damage to the Work shall pass to Purchaser under the specified Incoterms® (2020) and upon delivery to the designated delivery point as noted on the Purchase Order. Title to the Work shall pass to Purchaser upon delivery to the designated delivery point as noted on the Purchase Order or upon Vendor’s receipt of payment for the Work, whichever occurs first, provided that where progress or installment payments are made prior to delivery, Purchaser shall have title to the Work in progress including the Equipment incorporated therein but risk of loss or damage shall remain with Vendor until delivery under the specified Incoterms® (2020).

10. INSURANCE.

During the term of this Agreement, Vendor shall, at its own expense, maintain, and carry insurance in full force and effect which includes, but is not limited to, commercial general liability (including product liability) in a sum no less than $2,000,000 with financially sound and reputable insurers. Upon Purchaser’s request, Vendor shall provide Purchaser with a certificate of insurance from Vendor’s insurer evidencing the insurance coverage specified in these Terms. If requested by Purchaser the certificate of insurance shall name Purchaser as an additional insured. Vendor shall provide Purchaser with thirty (30) days’ advance written notice in the event of a cancellation or material change in Vendor’s insurance policy.

11. INSOLVENCY OF VENDOR.

Purchaser shall, without prejudice to any other right or remedy, have the right to reject the Work or any part thereof and cancel the Purchase Order without payment or other obligation whatsoever if prior to Purchaser’s acceptance of the Work or any part thereof, Vendor becomes insolvent, makes an assignment in bankruptcy, makes a general assignment for the benefit of creditors, makes any proposal under the Bankruptcy and Insolvency Act (Canada) or any comparable law, seeks relief under the Companies’ Creditors Arrangement Act (Canada), or any other bankruptcy, insolvency or analogous law, is adjudged bankrupt, files a petition or proposal to take advantage of any act of insolvency, consents to or acquiesces in the appointment of a trustee, receiver, custodian, or other person with similar power, of all or a portion of its assets or Vendor or its property or assets become the subject of any proceeding for the relief of creditors, which in the opinion of Purchaser would materially and adversely affect the ability of Vendor to perform or comply with its obligations hereunder.

12. WARRANTIES AND GUARANTEES.

Vendor warrants that all the goods and equipment included with the Work are of new and unused, good, sufficient and merchantable quality and shall conform to the specifications, drawings or other descriptions furnished by Purchaser and shall perform as specified therein. Vendor has complete control over and responsibility for furnishing the Work and shall perform the Work as described in the Purchase Order Documents. Vendor shall request from Purchaser any explanation Vendor may require as to the meaning or intent of any specifications, drawings or other documents furnished by Purchaser and Vendor shall be responsible for any errors or losses consequent upon failure to request such explanation. Vendor shall bring to the attention of Purchaser any obvious or perceived errors or omissions in any specifications, drawings or documents provided by Purchaser in relation to the Project and/or the Work.

Vendor warrants that it shall have an unfettered right to sell the goods or equipment included in the Work at the time title passes to Purchaser. Purchaser shall have and enjoy quiet possession of such goods or equipment comprised in the Work. The Equipment and other Work shall be free of any lien, hypothec, security, charge or encumbrance in favor of third parties.

General Warranty – Without limiting the generality of any of the foregoing, Vendor warrants that the Equipment will be free from defects in materials, design and workmanship and shall be fit for the purpose or purposes specified, required or intended (“Defect”, “Defects” or “Defective”) for twelve (12) months after Start-Up (the “General Warranty Period”). “Start-Up” means the date on which the performance guarantee tests on the Equipment are completed and the Equipment has passed the performance guarantees or, as the case may be, one or more guarantees have not been achieved and liquidated damages will be due, subject to conditions regarding when the performance guarantee tests must be commenced and completed.

Vendor warrants that the Equipment manufactured by Seller, including wear parts and spare parts, will be free from Defects for twelve (12) months after their integration into the Work but no later than eighteen (18) months following their delivery at the Site. Vendor also undertakes to transfer and assign, without charge, to Purchaser any and all warranties in and to the wear parts or spare parts manufactured by third parties.

If a Defect arises during the General Warranty Period, Purchaser shall notify Vendor of the Defect in writing by email within ten (10) business days after the Defect was detected. The notice shall identify the Equipment or part thereof that is Defective, describe the Defect as fully as possible, and include photographs or videos of the Defect. Any failure to provide notice within such time period shall not relieve Vendor of its warranty obligations, except (and only) to the extent that

a delay in providing notice has materially prejudiced the Vendor’s ability to mitigate the costs associated with responding to the warranty claim.

Within five (5) business days after receipt of Purchaser’s written notice, Vendor shall submit a plan for repairing or, as and to the extent determined by Vendor to be necessary, acting reasonably, replacing the Defective Equipment or parts thereof. Vendor shall repair Defective Equipment or parts thereof or supply or, as the case may be, deliver replacements for such Defective equipment or parts thereof at the Site or, at its expense, shall transport the Defective Equipment or parts thereof to an off-Site location for repair and transport the repaired Equipment or parts thereof back to the Site. Vendor shall deliver replacement Equipment or parts thereof DDP Site (Incoterms® 2020).

After receipt of Purchaser’s notice, Vendor may request and, in that event, Purchaser shall give reasonable access to inspect the Equipment and operation, maintenance and repair logs, DCS data, and other documentary, electronic, digital and other data and information that Vendor may reasonably request. If the inspection reveals that there is no Defect or there is a Defect but it was not caused by or the responsibility of vendor or a Sub-vendor, to the extent such conclusion is confirmed by the Purchaser, Purchaser shall reimburse Vendor for all reasonable travel and other costs incurred in connection with the inspection upon receipt of the supporting documents related thereto. If the inspection confirms that a Defect exists which was caused by or the responsibility of Vendor or a Sub-vendor, Vendor shall then promptly take action at its expense to repair or replace the Defective Equipment or parts thereof as stated above.

With respect to repair or replacement of Equipment that are subject to the General Warranty, Vendor warrants for a single time only that the repaired or replaced Defective Equipment or parts thereof will be free from Defects in Equipment and workmanship for twelve (12) months after the date of completion of the repairs or, as the case may be, the date when the replacement Equipment or parts thereof are delivered DDP Site (Incoterms® 2020).

Notwithstanding the expiration of the warranty period, Vendor shall remain available to offer support and assistance to Purchaser when defects occur, which shall be provided on customary and reasonable terms (including cost) following the end of the warranty period(s). The Vendor’s obligation to repair Defective Equipment or parts thereof or, as the case may be, to deliver replacement Equipment or parts thereof DDP Site (Incoterms®) shall extend even to Defects that Purchaser’s examination prior to acceptance of the Work or any part thereof ought to have revealed or did reveal.

13. PURCHASER’S RIGHT TO REPAIR DEFECTS OR MITIGATE CONSEQUENCES.

If Vendor fails to respond, or inadequately responds, to Purchaser’s written notice of a Defect as stated in Clause 12, Purchaser may proceed to repair or replace the Defective Equipment or parts or to have same repaired or replaced. In such event, Vendor shall reimburse Purchaser (i) the cost (including all labor costs) of repairing the Defective Equipment or parts thereof and (if necessary) the cost of transporting the Defective Equipment or parts thereof to an off-Site location for repair and the cost of transporting the repaired Equipment or parts thereof back to the Site, or, as the case may be (ii) the purchase price of the replacement Equipment or of parts thereof and the freight costs incurred in delivering them DDP Site (Incoterms® 2020). In urgent circumstances, Purchaser may take immediate steps to mitigate the consequences of any defect or to repair or replace Defective Equipment subject to prior notification to Vendor. In that event, Vendor shall reimburse Purchaser to the same extent stated above.

14. INTELLECTUAL PROPERTY.

Purchaser shall own, and Vendor hereby assigns to Purchaser effective concurrent with the transfer of title to the Work to Purchaser, all Intellectual Property Rights in the Work (including to any improvements thereon) other than the Intellectual Property Rights in the Vendor Background IP. With respect to Vendor Background IP, Vendor grants to Purchaser a perpetual, irrevocable, royalty-free, assignable license to use all the Intellectual Property Rights in or associated with the goods or equipment comprised in the Work, Vendor Background IP (including any Vendor Confidential Information) for purposes of installing, operating, maintaining, selling or repairing the Work. Vendor shall procure from any Sub-contractor or Sub-vendor any Intellectual Property Rights necessary to make the forgoing assignment and licence, and shall obtain an enforceable waiver of any moral rights (or other non-assignable Intellectual Property Rights) from any personnel involved in the creation of the Work. Vendor shall pay all royalties and license and other fees and ensure that the Work furnished hereunder shall not infringe any patent or rights of third parties. Vendor agrees to defend, protect and save Purchaser harmless and fully indemnified from and against all suits at law or in equity and from all claims and demands for actual or alleged infringement of any patent, license or other rights of third parties by reason of the use of the Work or any part thereof and from all costs, expenses (including court costs and legal fees and expenses) or damages suffered or incurred by reason thereof or in respect thereto. Vendor shall obtain at its expense from any patent, license or other right held by a third party, permission for Purchaser to commission and use the Work or any part thereof.

Nothing in the Purchase Order Documents shall grant any licence or ownership rights in any Intellectual Property Rights of Purchaser to Vendor, other than a limited licence to use any such Intellectual Property Rights the extent required for Vendor to fulfil its obligations hereunder. All such Intellectual Property Rights of Purchaser shall remain solely the property of Purchaser.

15. INDEMNIFICATION.

Without prejudice to the other indemnities hereunder or arising at law or in equity, Vendor indemnifies and saves harmless Purchaser, its affiliates, and each of their respective shareholders, directors, officers, personnel and agents and their respective heirs, personal representatives, successors and assigns from all claims, liabilities, actions, causes of actions by third persons, damages, losses, costs and expenses (including legal costs on a solicitor and his own client basis) caused directly or indirectly, in whole or in part, by Vendor, or its Sub-vendors or Sub-contractors or otherwise those for whom Vendor is responsible, arising out of or in any way connected with the Work, Equipment, the Vendor’s negligent acts or omissions, Vendor’s or its agents’ violation of law, breach by Vendor of any provision of the Purchase Order Documents, or from any personal injury, death or damage to physical property caused by Vendor or its agents. For purposes of this clause, Sub-contractors and Sub-vendors shall be considered agents of Vendor.

16. LIENS.

The provisions of this Clause shall apply notwithstanding anything anywhere else contained in the Purchase Order Documents.

Vendor shall keep the Site free and clear of any liens for services, labor or Equipment furnished or employed by Sub-vendors and Sub-contractors in connection with or for the Work.

If at any time a Sub-contractor or Sub-vendor places a lien on the Site or the real property or properties of Purchaser on which the Work is located, Vendor shall cause the lien to be removed within thirty (30) days after receipt of written notice from Purchaser of the lien. If Vendor fails to remove the lien within such 30-day period, then Vendor shall indemnify, defend, and hold Purchaser harmless from and against all costs that it incurs to the extent caused by the lien until such time as Vendor complies with its obligations under this Clause. Further, if Vendor fails to remove the lien within such 30-day period, Purchaser shall have the right to retain out of any money due or any money to become due to Vendor, and out of any payments on account thereof, an amount sufficient to indemnify Purchaser against any such lien, privilege or claim and all costs and expenses, including those of Purchaser, and Purchaser shall be entitled to pay into court out of such retained amount the amount of any such lien, privilege or claim and such costs and expenses in respect of the same, in order to obtain a release or discharge of such lien or claim.

Purchaser shall have the right at any time to require Vendor to submit a partial waiver of lien or, with respect to final payment of the Price, a final lien waiver. Furthermore and upon final payment of the Price and receipt thereof by Vendor, Vendor shall provide to Purchaser a final release with regards to the payment of the Price. Vendor will defend and indemnify Purchaser from claims by Sub-vendors and Sub-contractors for payments claimed to be due and owing under their respective purchase orders or subcontracts with Vendor.

17. LIMITATION OF LIABILITY.

Under no circumstances will Purchaser, its affiliates, or any of their respective directors, officers, agents or employees, be liable to Vendor or any other person or entity for special, incidental, consequential, punitive, exemplary or indirect damages, loss of goodwill, business revenues, customers, business, profits, anticipated profits, or interest, work stoppage, downtime costs, or loss of use or equipment or facilities, cost or increased cost of capital; or data loss, whether based in contract, warranty, tort (including, but not limited to, negligence, gross negligence or strict liability). Purchaser’s maximum liability in any circumstance to Vendor hereunder shall be the total cost set forth in the Purchase Order.

Except in the case of breach of confidentiality, a breach of Section 14, or in the case of fraud, gross negligence or wilful misconduct, under no circumstances will Vendor, its affiliates, or any of their respective directors, officers, agents or employees, be liable to Purchaser or any other person or entity for special, incidental, consequential, punitive, exemplary or indirect damages. Except in the case of breach of confidentiality, a breach of Section 14, or in the case of fraud, gross negligence or wilful misconduct, Vendor’s maximum liability to Purchaser hereunder shall be the greater of (i) US$2,000,000 and (ii) two times (2x) the total cost set forth in the Purchase Order.

18. DELIVERY ACCEPTANCE.

Subject to Clause 24, Purchaser shall be deemed not to have accepted any of the Work or any part thereof until it has had an opportunity, which is reasonable under all the circumstances, to fully examine the Work or any part thereof and notify Vendor of any objection it may have and in any event for at least a period of thirty (30) days from, but not counting, the day on which Purchaser is in receipt of all the Work or any part thereof that is or are completed. Payment of the Price or any part thereof shall not be deemed to be evidence of acceptance of the Work or any part thereof under the Purchase Order.

Furthermore, Vendor shall be responsible for:

i. damage to the Equipment caused by failure to properly pack the Equipment in accordance with the Purchase Order Documents requirements or by mishandling prior to delivery at the delivery site, or

ii. any Defect (as defined in Clause 12– Warranty) in Equipment

that is detected during the period between delivery of the Equipment and the date of Start-Up (the “Pre Start-Up Defect Correction Period”). In either event, Vendor, shall repair or, if necessary, replace the damaged or Defective Equipment at its expense as and to the same extent stated in Clause 12– Warranty after receiving written notice of such damage or Defect from Purchaser or, as the case may be, after discovery of same by Vendor or its sub-vendors. If Vendor replaces damaged or Defective Equipment, it shall remove promptly such Equipment from the Site at its expense. If Vendor disagrees that damage exists or that it is responsible for such damage or, as the case may be, that a Defect exists, Vendor shall nevertheless comply with its obligation under this paragraph without prejudice to its right to submit a claim for the impacts that it incurs in complying with its obligations.

If nonconforming packaging or crating is discovered after delivery of Equipment, Vendor and Purchaser shall expeditiously examine the packaging or crating, inspect the Equipment, determine whether the Equipment are damaged, and if so determine whether the damage can be repaired or the Equipment should be replaced.

19. SHIPMENT AND PACKING.

Unless specifically defined in the Purchase Order, if Vendor is responsible under the designated Incoterms® 2020 for delivery to transport or arrange for the transport of Equipment, Vendor shall be responsible for selection of a reliable and diligent carrier to deliver the goods of the Purchase Order to the delivery location identified in the Purchase Order and in accordance with the Incoterms® (2020) as may be defined in the Purchase Order. Vendor shall provide copies of the shipper’s waybills and bills of lading upon request.

Vendor shall be solely responsible, unless specifically addressed elsewhere in the Purchase Order Documents, for adequate packaging, blocking and bracing to assure that the goods comprising the Work arrive at Purchaser’s facility without damage due to weather, impact or mishandling.

Equipment from more than one (1) purchase order shall not be consolidated in any one package without express permission from Purchaser.

If any of the Equipment or constituent parts thereof are classified as Dangerous Goods, Vendor shall ensure that Purchaser is advised as to the nature of such Dangerous Goods. Vendor’s shipping specification and delivery advice shall contain full details of such Dangerous Goods. Vendor shall be held responsible in the event of failure to comply.

Where any substance being supplied under the Purchase Order is hazardous to health as defined in under applicable laws, Vendor shall separately identify any such substances upon delivery to Purchaser. Vendor shall, at the time and place of delivery, provide Material Safety Data Sheets for all such substances supplied under the Purchase Order including the subsequent disposal of any waste arising there from. If the total quantity of such substances covered by the Purchase Order is to be delivered in several consignments, each consignment is to be accompanied by the information required by this Clause.

Prior to shipment, Vendor shall prepare detailed box-wise, container-wise or truck-wise final packing lists, depending on the shipment configuration, fully describing the contents of the shipment.

Purchaser reserves the right to refuse delivery of any goods comprised in the Work shipped without regard or contrary to Purchaser’s shipping and packaging instructions and any charges, expenses, damages, or costs incurred as a result thereof shall be for Vendor’s account.

20. CONFIDENTIAL TREATMENT OF TECHNICAL INFORMATION.

Vendor agrees that it shall not disclose or supply any of Purchaser’s proprietary or confidential information to any third party, including without limitation, technical information, technical documentation, drawings, designs, data, studies, reports, analyses, models or patterns supplied to it by Purchaser, or Purchaser-owned information obtained or acquired by Vendor through observation, communication or examination of Purchaser’s facilities, processes or procedures, without Purchaser’s prior written consent thereto. In the event that Vendor obtains such consent to such disclosure or supply, prior to disclosure, Vendor agrees to obtain from any such third party a covenant of non-disclosure in favor of Purchaser on in a form specified by Purchaser.

Purchaser retains title to all drawings, specifications and other information submitted by Vendor as part of the Work, other than to the extent the same were not specifically created for Purchaser or that are proprietary to and owned by Vendor or its licensors, including, for example, Vendor’s underlying technical knowhow, trade secrets and other intellectual property and Vendor’s proposals, pricing, and other proprietary business information (“Vendor Confidential Information”). All Vendor Confidential Information shall remain the property of Vendor and/or, as the case may be, its licensors regardless of disclosure to Purchaser (but is subject to the licence set forth in Clause 14). Purchaser agrees that it shall not disclose or supply Vendor Confidential Information which is not incorporated into the Work or necessary for the commissioning, start-up, operation, repair or maintenance the Work, to any third party without Vendor’s prior written consent thereto.

21. COMPLIANCE WITH APPLICABLE LAWS.

Vendor warrants that the Work or any part thereof shall comply with all applicable laws, by-laws, regulations, codes, permits, rules, decisions, or orders of any lawful authority having jurisdiction in the place of delivery or at such other place or places of intended use as may be specified by Purchaser. Vendor warrants that the normal use of the Work or any part thereof by Purchaser shall not constitute a violation of or an infringement to any such laws, by-laws, regulations, codes, permits, rules, decisions, or orders and Vendor agrees to indemnify and save Purchaser harmless from and against any fines, penalties, or other charges imposed on Purchaser as a result of the non-compliance of the Work or any part thereof with any such laws, by-laws, regulations, codes, permits, rules, decisions, or orders.

22. ASSIGNMENT.

Under no circumstances will Vendor assign this Purchase Order or any moneys to become due hereunder, or subcontract any of its obligations hereunder, without first obtaining the written consent of the Purchaser in each and every instance.

23. GOVERNING LAW.

This Purchase Order shall be interpreted, construed and enforced as written in accordance with, and all other matters in connection with the Purchase Order and/or its performance shall be governed by, the laws of the Province of British Columbia, notwithstanding that a different result would be required by application of the conflicts of laws rules of British Columbia or of any other jurisdiction. The Parties waive application and jurisdiction of the United Nations Convention for the International Sale of Goods.

24. INSPECTION AND TESTING.

At any time during the manufacture or fabrication of any Equipment, Purchaser and/or any of its authorized representatives shall be entitled to inspect, examine and test the Equipment to be incorporated therein in such manner as not to delay completion of manufacture or delivery of the Equipment. Vendor shall give or cause to be given free and safe access for Purchaser’s representatives to inspect, examine and test the Equipment during manufacture or any part thereof or the Equipment to be incorporated therein at any time during business hours and shall provide or cause to be provided adequate facilities for such inspection, examination or testing. Any inspection, examination or testing shall not relieve Vendor of any of its obligations under the Purchase Order. If Purchaser’s inspection reveals that the Equipment is damaged or otherwise does not conform to the requirements of the Purchase Order Documents, Purchaser shall so immediately notify Vendor verbally and confirm its notice in writing within forty-eight (48) hours thereafter. Vendor shall promptly arrange to adjust, modify, repair or, if necessary, replace such Equipment at its expense, subject to Vendor’s rights under Clause 30.

25. MONITORING.

Vendor shall prepare and provide monthly reports to Purchaser concerning the progress, status or scheduling of the Work or any part thereof, or the performance thereof. Vendor shall give Purchaser access to, and where required by Purchaser provide, copies of any approved subcontract (with price information redacted), Sub-contractor’s and/or Sub-vendor’s specifications or drawings, schedules, survey records, test results, field instruction, shop or working drawings and sketches, and other similar records or documents.

26. PURCHASER’S RIGHTS OF SET-OFF.

Payments otherwise due by Purchaser may be withheld by Purchaser because of (a) defective Equipment, workmanship or design not remedied, or (b) liens or any encumbrances claimed against the Work or any part thereof that Vendor does not bond around or remove, cancel or have cancelled within the period stated in Clause16– Liens, or (c) liens claimed against Purchaser’s property in respect of the Work. Amounts withheld in reliance on this Clause shall not exceed the amount necessary to protect Purchaser’s interest. Withheld payments shall promptly be made upon correction, performance or removal of the matter justifying the withholdings. If such matters are not corrected, performed, or removed within ten (10) days after written notice thereof from Purchaser to Vendor, Purchaser may rectify the same at Vendor’s expense. Should any valid indebtedness arise after final payment is made, Vendor shall reimburse Purchaser for any amount that Purchaser may pay in discharging any lien thereof or any claim affecting title to the Work or Vendor’s property. Purchaser may apply the holdback or any part of it to rectify the situation. Purchaser shall be entitled to set-off against payments otherwise due hereunder and, all expenses or costs properly incurred by Purchaser hereunder which shall be for Vendor’s account.

In addition to any right of set-off or recoupment provided by law, Purchaser may at any time and without notice set-off claims by Vendor for amounts due or to become due from Purchaser under the Purchase Order Documents against claims that Purchaser has or may have arising out of the Purchase Order Documents or any other agreement between Purchaser and Vendor or any of Vendor’s affiliates.

27. WAIVER.

Any failure by a Party, at any time, or from time to time, to enforce or require the strict keeping and performance of any of the Terms and Conditions shall not constitute a waiver of any such terms or conditions and shall not affect or impair in any way such terms or conditions or the right of that Party at any time to avail itself of any remedies that it may have for any breach of such terms or conditions. A Party’s election to adopt any particular remedy shall not affect its right to subsequently avail itself of any further or other remedy that may be available to it. The communication to Vendor at any time of any reasons or justifications for any decision by the other Party shall be deemed to have been communicated without prejudice to the other Party’s right to subsequently rely on any other or additional reasons or justifications therefor.

28. INSTALLATION SUPERVISION AND COMMISSIONING SUPPORT.

If, in connection with the installation or commissioning of the Work, Vendor uses the services of a supervisor, expert or other employee connected with or employed by the Vendor either with or without charge to Purchaser, such supervisor, expert or other employee in performing such services does so as the agent or employee of Vendor and Vendor assumes full responsibility for his acts and omissions and for the compensation of such individual(s) (including paying for all wages, salary, benefits, and taxes associated with such compensation).

29. PAYMENT, DESCRIPTION AND CHANGES.

Subject to the right of set-off, Purchaser shall pay the Price in accordance with the Price schedule and payment terms set forth on the face of the Purchase Order.

Purchaser reserves the right to change any specification, drawing or other description furnished by Purchaser or any quantities specified therein through a Change Order without invalidating the Purchase Order subject to making mutually agreed equitable adjustments increasing or decreasing the Price and/or, as the case may be, equitable adjustments of the delivery times. Vendor shall not unreasonably withhold, condition or delay consent to any such Change Order. Where any ambiguity or inconsistency appears in the Purchase Order Documents it shall be Vendor’s obligation to notify Purchaser in writing of same and obtain clarification prior to performance of any of the Work affected thereby. All such changes shall be effective and binding upon receipt by the Vendor of a signed Change Order issued by Purchaser which is accepted by Vendor. Pending receipt of a Change Order, Vendor shall continue with all Work that is not affected by the change.

Vendor shall comply with Purchaser’s decision as to the intended meaning of any term, condition, specification, drawing or other description and with any change ordered, provided that Vendor may, by written notice to Purchaser prior to commencement of any work affected by such decision, reserve the right to subsequently claim an equitable adjustment in respect thereto.

30. CLAIM FOR ADDITIONAL COMPENSATION.

Vendor shall comply with all directions, decisions and requirements of Purchaser, including, but not limited to, the interpretation of the Purchase Order and any of the Purchase Order Documents, provided that by notice in writing to Purchaser delivered within five (5) business days after receipt of such direction, decision or requirement, Vendor may reserve the right to subsequently claim that any such direction, decision or requirement entitles it to additional compensation for such Work and/or, as the case may be, a time extension for the full extent of the impacts that such direction, decision or requirement may cause. Any claim reserved by Vendor as provided in this Clause shall be limited to a claim that Vendor was required to do work that was not part of the Work. The claim shall be limited in amount to the additional costs incurred by Vendor in performing the affected Work and/or, as the case may be, an extension of the time of performance for the full extent of the cost and time impacts caused by such direction, decision or requirement.

Any failure by Vendor to give notice to Purchaser as provided in this Clause before the work of which the question of additional compensation arises is commenced, shall constitute an irrevocable waiver and release by Vendor of any right to claim such additional compensation or make any subsequent claim to take any proceedings directly or indirectly involving a claim for additional compensation because of such direction, decision, or requirement.

31. TIME OF PERFORMANCE.

Vendor shall be liable to Purchaser for any delay in completing a delivery of the Equipment if Vendor fails to deliver Equipment by the relevant scheduled delivery date and thereby delays Start-up. If Vendor, a Sub-contractor and/or a Sub-vendor are/is solely responsible for delay in delivery of a Equipment, Vendor shall take all steps that may be necessary to mitigate its delay.

Purchaser reserves the right to direct Vendor to reschedule from time to time the sequence of performing the Work hereunder to accommodate the Purchaser. The rescheduling of any Work by the Purchaser shall not impact the performance of the Vendor. If delays are caused by the Purchaser’s rescheduling and/or the rescheduling increases Vendor’s cost of the Work in whole or in part, Purchaser shall pay additional costs incurred by Vendor in performing the affected Work and/or, as the case may be, an extension of the time of performance for the full extent of the cost and time impacts caused by the rescheduling.

Whenever an actual or potential labor dispute to which Vendor, or its Sub-contractor or Sub-vendor, is a Party is delaying or threatens to delay the performance of the Work, Vendor shall immediately notify Purchaser in writing, giving all relevant information concerning the dispute and its plans to mitigate the effect of such labor dispute on the Work.

32. SUB-CONTRACTORS AND SUB-VENDORS.

Vendor agrees to preserve and protect the rights of the Parties under the Purchase Order with respect to the Work to be performed by Vendor’s Sub-contractors and Sub-vendors and to:

a. enter into purchase orders or written agreements with its Sub-contractors and Sub-vendors to require performance of their work in accordance with and subject to the Purchase Order Documents that are pertinent to the subcontracted Work; and

b. be as fully responsible to Purchaser for acts and omissions of its Sub-contractors and Sub-vendors and for acts and omissions of persons directly or indirectly employed by them.

33. ADVERTISING AND PUBLICITY.

Vendor shall not use the name of Purchaser in any advertisement whatsoever, including press releases and announcements with respect to the Purchase Order, without the prior written consent of Purchaser.

34. FORCE MAJEURE.

Both Parties shall be absolved from liability for any act, omission, or circumstance occasioned by any event not caused by or within the reasonable control of either Party or (i) its representatives, (ii) its contractors or their subcontractors or suppliers of any tier, or (iii) others acting on its behalf that either prevents a Party from performing Work or an obligation under the Purchase Order (excluding making payment to the other Party as and when due) or renders performance of such Work or obligation commercially impractical (“Force Majeure”). The Party affected by Force Majeure shall give written notice and full particulars of the Force Majeure event in writing to the other Party as soon as possible after the occurrence of the cause relied on. Without restricting the generality of the foregoing, the following shall be deemed to be cases of Force Majeure per se: acts or threatened acts of war; riot or other serious civil unrest; strikes, walkouts, lockouts and other labor disruptions; embargoes, boycotts, quarantines and other governmental actions; cyclones, typhoons, hurricanes, tornadoes or other acts of God; unusually severe weather for the location and time of year; actions or threatened actions by terrorists or other public enemies; earthquakes, riots, floods, fire, or explosions; epidemics and pandemics (including but not limited to the COVID-19 pandemic but only to the extent that stay-at-home, shelter-in-place, quarantine and other current and future national, state/provincial and local government laws, regulations, orders and actions in the U.S. and other countries in response to the COVID-19 pandemic are adopted and that any of the foregoing prevent a Party from performing Work or an obligation under the Purchase Order as set forth hereinabove and that such Party may establish and prove such measures to the other Party); or any other causes of a similar or dissimilar nature over which a Party has no reasonable control. For purposes of these provisions neither Party shall be required to settle any strike or other labor problem except on terms acceptable to it.

Any delay to a Party’s commencement, performance or completion of Work or another obligation under the Purchase Order Documents caused by Force Majeure shall be excused. Vendor shall be entitled to a Change Order for an adjustment of the Purchase Order’s time of performance and schedule for the full extent of the impacts caused by and resulting from a Force Majeure event. The Parties acknowledge that future stay-at-home, shelter-in-place, quarantine and other future federal, provincial and local government laws, regulations, orders and actions in Canada and other countries in response to the COVID-19 pandemic may stop, prevent or delay manufacture and/or delivery of Equipment and impact Work or other work at the Site. Vendor shall promptly notify Purchaser of such an event, in no case more than three (3) business days after Vendor is informed of the event. Vendor and Purchaser shall promptly, but within a maximum of five (5) business days, assess the implications and actions to be taken in consequence thereof, including but not limited to re-sourcing manufacture of Equipment to a different shop or vendor. If they so agree, Purchaser shall issue a Change Order to Vendor for mutually agreed changes to the delivery dates and Vendor shall then proceed accordingly.

35. DISPUTES.

For the purposes of this Clause, “Disputes” shall mean all disputes, differences, controversies, claims, counterclaims or other matters arising out of or in connection with the Purchase Order or the breach of it, the Equipment or other Work, performance of the Work, the Project, or failure or alleged failure thereof or the interruption, application, administration or observance of any of the Purchase Order Documents, any failure to agree where agreement between the Parties is called for, the Parties’ respective rights or duties in connection with this Purchase Order, or in respect of any defined legal relationship associated with it or derived from the Purchase Order.

If a Dispute is not resolved promptly, Purchaser shall give such written instructions as in Purchaser’s opinion are necessary for the proper performance of the Work and to prevent delays pending settlement of the Dispute. Vendor shall act immediately according to such instructions, it being understood that by so doing Vendor shall not jeopardize any claim Vendor may have. If it is subsequently determined that such instructions were in error or at variance with the Purchase Order, Purchaser shall pay Vendor’s costs incurred by Vendor in carrying out such instructions which Vendor was required to do beyond what the Purchase Order correctly understood and interpreted would have required, including Vendor’s additional costs resulting from delay, disruption or interference with the Work, and an extension of the time of performance for the full extent of the cost and time impacts caused by such instructions.

Any Dispute which cannot be promptly resolved shall be submitted to arbitration in accordance with the provisions of this Clause by the giving of written notice by either Party to the other Party (an “Arbitration Notice”), specifying particulars of the matter or matters in a Dispute.

The arbitration shall be held in English in Vancouver, BC and conducted in accordance with applicable laws then in effect. Arbitrations of claims shall be heard by a single arbitrator. The arbitrator shall be a lawyer with significant experience as an arbitrator and in the area of construction law.

The arbitrator shall have discretion to apportion the costs of the arbitration as between the parties such that each party bears the cost in inverse proportion to which it is successful in the arbitration (i.e., that the unsuccessful party bears the costs, or the costs are proportionately shared if each party if partially successful).

The provisions of the Purchase Order and this Clause requiring the determination of certain Disputes by arbitration shall not operate to prevent recourse to a court of competent jurisdiction by any Party with respect to injunctions, receiving orders and orders regarding the detention, preservation and inspection of property, or whenever enforcement of an award by the arbitrator reasonably requires access to any remedy which an arbitrator has no power to award or enforce. In all other respects an award by the arbitrator shall be final and binding upon the Parties and there shall be no appeal from the award of the arbitrator on a question of law or any other questions provided that the arbitrator has followed the rules provided herein in good faith and has proceeded in accordance with the principles of natural justice.

Notwithstanding the foregoing, arbitration proceedings shall be held in abeyance and not be proceeded with until after substantial performance of the Work or the Purchase Order has been terminated, whichever is the earlier, unless the Parties can show that the matter in Dispute is of such nature as to require immediate consideration while evidence is available.

36. POWER OF THE PURCHASER.

Purchaser is in the first instance the interpreter of the Purchase Order and, acting reasonably, shall be solely responsible for evaluating the performance by Vendor. Purchaser shall have the power, subject to the Dispute resolution procedure set forth above, to determine whether the Work performed and the Equipment furnished are in accordance with the Terms and Conditions.