MARINE2DSEISMIC DATA ACQUISITION SERVICES AGREEMENT

1.1

This Agreement consists of three main "Sections" as detailed below. Each Section consists of several "Clauses".

1.2

In this Agreement, unless the context requires otherwise, the following words or expressions shall have the following meanings:

 

b)

"Services" means the marine seismic data acquisition and related services described in Section 2;

 

c)

“Survey” means the seismic survey conducted as part of the Services.

1.3

Where the context so admits, words importing the singular shall include the plural and vice versa, and words importing persons shall include firms and corporations and vice versa.

1.4

Clause headings are for ease of reference only and have no effect on the interpretation or construction of this Agreement.

1.5

In the event of any conflict and/or discrepancies between the Sections which form this Agreement, the Sections shall take precedence in the reverse order of the list defined in Clause 1.2a) above.  Thus, the terms and conditions of Section 3 “General Conditions” shall take precedence over Section 2 “Scope of Services and Commercial Terms”, which shall in turn take precedence over Section 1 “Form of Agreement”.  In the event of any conflict and/or discrepancies between a Section and its related Appendices, the text of the Section shall prevail.

1.6

Unless the context otherwise requires, other terms defined elsewhere in this Agreement shall have the same meaning throughout the Agreement.

 

Contractor agrees to provide, execute and complete the Services for the sole and exclusive benefit of Company in accordance with the terms and conditions set out in this Agreement and Company agrees to pay all amounts due hereunder for the Services in accordance with the terms and conditions set out in this Agreement.

 

The Services shall be provided in accordance with the techniques set out in Appendices C (Scope of Work), as rapidly as conditions permit and shall be performed in a professionally competent and workmanlike manner.

2.1

Contractor shall make available and use in the conduct of the Survey the equipment and the vessel BOS ARCTIC as specified in Appendix B.  (Technical Specification)  The Contractor shall make the vessel BOS ARCTIC available for inspection by the Company within a mutually agreeable time frame prior to mobilization. 2.2 The Equipment shall be capable of providing data in accordance with the specifications contained in Appendix E.  (Operating Standards)

2.3

To verify that the Equipment can produce data in accordance with the agreed to specifications, Contractor shall conduct the start up and periodic tests described in Appendix E and following Company’s written request shall deliver the results thereof to Company. Company's Representative may attend such tests if Company so requires.

2.4

Contractor shall provide all normal spare parts for the efficient running and maintenance of the Equipment and shall at all times during the Survey replace at its own expense any defective or faulty parts.

2.5

Contractor shall use reasonable endeavours to provide any additional items of equipment requested by Company at a price to be agreed between the Parties.

4.1

The Survey shall take place in the area set out in Appendix A (Location and Survey Map) by reference to country, area, license block and/or other description (the "Survey Area") and shall be conducted along the seismic lines and/or over the total number of kilometres specified in Appendix A. Company shall furnish Contractor with adequate and customary charts and maps of suitable scale and detail for the Survey Area. If the seismic lines are not specified on such charts and maps, then this shall be as subsequently agreed between Contractor and Company.  If the order in which the seismic lines are to be surveyed is not specified then this shall be under the control of Contractor, who shall decide, and may subsequently amend such order.

4.2

Contractor shall be entitled to rely on the above referenced maps and charts and shall bear no responsibility to Company for Services rendered based on faulty or erroneous maps and charts and any claim or damages resulting there from shall be for Company's sole account.

 

Contractor shall use its best endeavours to arrive with the Equipment and Personnel in the Survey Area on or before the date set out in Appendix F (Commencement Date) and shall carry out the Survey as rapidly thereafter as conditions shall permit.

 

Company shall pay Contractor in accordance with the rates, charges and fees, and on the terms set out in Appendix D (Rates, Charges and Fees). Additionally, in the event of early termination for reasons other than Contractor's default, Company shall pay Contractor in accordance with Clause 22.1 of Section 3.  The Parties agree that the Services provided by Contractor cannot be cancelled or terminated earlier without first reaching an agreement on an early termination fee to be paid to Contractor

 

Contractor shall not start or continue the Survey when the Equipment fails to meet the Operating Standards set out in Appendix E.

 

Contractor shall deliver the field tapes containing the data collected during the Survey together with such information and reports specified by Company, at times to be agreed with Company, to such person, carrier or place and in a manner as Company may require, all as set out in Appendix C.

 

Following Company’s written request and a subsequent agreement between the Parties, Contractor may to the best of its ability (but without liability for failure to do so) supply other personnel, equipment, supplies and services in the performance of the Survey, such as but not limited to:

 

a)

Fisheries Inspectors or other governmental agents necessary to meet the requirements of the local law, including vessel transport and other expenses for them.

 

The general scope and practice of the Services shall be under the direction of Company, but the actual conduct and the manner of performance of the Services shall be under the direction, supervision and control of Contractor. Contractor is an independent contractor, and is not an agent of Company, and persons engaged by Contractor in the Services and all matters incidental thereto shall be employees or independent subcontractors of Contractor and not of Company. No employee of Company shall be deemed to be an employee of Contractor, and neither Company nor Contractor shall have control over the employees of the other.

2.1

Company and Contractor shall each appoint and maintain a competent representative to act on its behalf.  The representative shall be authorised to act on behalf of Company and Contractor respectively in all matters concerning the Services and administration of this Agreement. Representatives shall be available for consultation at all reasonable times, and all oral/or written communication shall be between these representatives. Should a Party's representative prejudice the proper and efficient performance of the Services, the other Party may request his removal and upon good cause shown, the representative shall be removed and replaced as soon as is reasonably practicable. Contractor reserves the right not to allow employees of its competitors or its former employees or former employees of its affiliates to act as Company Representatives.

2.2

Company may designate one on-board representative (“the On-Board Representative”) to act on its behalf and to supervise and where necessary give directions about the Survey.  Such representative should be entitled to exercise Company's rights arising from this Agreement.  All costs and expenses of and incurred by such representative shall be met by Company, save that Contractor shall provide accommodation and food for such representative.

3.1

For Services rendered off Contractor’s premises, Company shall secure for Contractor rights of ingress and egress to the area where Services are to be performed by Contractor. Company shall advise Contractor of any limitations or restrictions affecting ingress and egress, and Contractor shall abide by such limitations or restrictions. Should Contractor be denied free access to such area for any reason not within the control of Contractor, Contractor shall not be liable to Company for any liability, loss, cost or expense resulting therefrom.  During such period Contractor shall be paid in accordance with the rates, charges and fees set out in Appendix D.

3.2

Contractor shall be responsible for obtaining all licenses and approvals required by applicable law from any authority to enable Contractor to perform the Services.  This does not include permits to be provided by Company pursuant to 3.3 below.

3.3

Company shall be responsible for obtaining all licenses, permits and approvals, required in the name of Company, from any authority or company to enable the Services to be performed. For the avoidance of doubt this shall include any license being in the nature of a mineral exploration or prospecting license. Contractor acknowledges Company’s exclusive contract with the Republic of Guinea and Company represents to Contractor such exclusive rights and Company  has shown Contractor its rights are granted through its 2006 Hydrocarbon Production Sharing Contract, and as such, Company  is the lessee and owner of the concession offshore Guinea and thus Company  may notify the Guinea government of any of all of its petroleum operations and any and all of its chosen sub-contractors, and therefore Company’s  arrangement with the government is to merely notify the government of its sub-contractors and ongoing work, and as such Company will be providing Contractor with permits it writes in accordance with its exclusive contract with the Republic of Guinea for performing all work specified in Work Orders associated with this agreement, and such permits, may or may not come with timely independent  acknowledgement from the Republic of Guinea and the parties agree that any such lack of acknowledgment will not be cause to delay any Services under this agreement. In the Company’s experience the Government usually responds in writing upon acknowledgement requests but not always, thus the 2006 Production Sharing Contract is the basis for it or any of its Sub-Contractors to enter the contract area to perform petroleum operations under the 2006 Production Sharing Contract which is in full compliance with the 1986 Petroleum code of the Republic of Guinea.

3.4

Subject to the provisions of Clause 13, Company shall indemnify the Contractor against any liability whatsoever arising from its failure to obtain and maintain, or any breach of, any license, permit or approval which it is responsible for obtaining under 3.2 and 3.3 above.

4.1

Contractor warrants that the Services will be performed in accordance with good geophysical practices and with all the requirements of this Agreement and will at the time of performance comply with the technical and other specifications contained in this Agreement.  Any interpretation of seismic data, interpretation of test and any recommendation or reservoir description is expressly excluded from the scope of the Services. All other warranties, express or implied, or whether relating to merchantability, fitness for a particular purpose, or otherwise, are hereby excluded and disclaimed.

4.2

Contractor does not warrant the accuracy of seismic data transmitted by electronic processes and will not be responsible for any liability resulting from breach of the integrity of the data, including any accidental or international interception of such data by others.

4.3

As long as the data is delivered periodically and can be verified by Company every week or two weeks during the data acquisition, the Parties acknowledge that defective, damaged or incorrect data delivered to Company will become apparent during the course of the Services.  Contractor shall not be liable for any claims submitted in respect of such data after demobilisation as long as Company has received all the source data field records and verified and backed up the source data.

 

a)

refund to Company of that portion of the seismic data acquisition costs originally incurred, that is directly related to and required as a result of the loss, damage or destruction of the tapes; or

 

b)

re-acquisition by Contractor of the seismic data lost, damaged or destroyed, at a time to be determined by Contractor, but within 12 months from the date of such loss, damage or destruction.

 

However, if the damage is such that it may be reasonably corrected through the provision of tape copies or further re-processing services, that shall be the sole remedy available to Company. Notwithstanding the above, if a reputable or agreed common carrier is used to transport the seismic data tapes, then Company shall bear the risk of loss, damage or destruction of the tapes during such transport and Contractor shall bear no liability therefore.  However, until data is obtained from Contractor and verified, Contractor is not deemed to have delivered the data. In all cases damaged tapes that are replaced by Contractor shall become the property of Company.

5.2

Unless specifically and separately contracted and paid for, Contractor assumes no liability for and shall not be responsible for any gratuitous bailment or storage of any seismic data, whether on tape, disk, in physical sections, in computer memory or in any other form whatsoever, Contractor shall not be liable for any damage, destruction, loss or theft of any such seismic data or portions thereof and Company agrees to defend, indemnify and hold Contractor harmless from any and all claims brought by third parties in relation to such seismic data.

5.3

Contractor shall not be required (save as otherwise expressly agreed in writing) to store, hold or save any drawings, seismic data, tapes, reports, records or other information in any media about or arising from the Services after completion of the Services.

 

All drawings, reports, records, seismic data, tapes and other documents or information furnished by Contractor in the course of, or as a result of, performing the Services may be used by Company for any lawful purpose and shall be and become the property of Company as soon as they are created, subject only to Contractor’s receipt of the full payment for the Services rendered.

7.1

All information in any media supplied by Company and all material to which Company becomes entitled under Clause 6 shall be and remain the property of Company and shall be returned by Contractor to Company immediately upon completion or termination of the Services, upon request in writing. Contractor shall not permit any person other than a duly authorised representative of Company to borrow or to have access to such information and material or any part thereof, and shall keep the same strictly confidential and shall neither divulge any such information to any third party nor permit any of its officers, employees, or agents to do so without prior written consent of Company. Excepted from this undertaking is any information or media already in the public domain or which is required to be disclosed by law or legal process.

7.2

Company shall treat in the strictest confidence all specifications, know-how, technical and other information about the techniques, services and equipment used or provided by Contractor under this Agreement and otherwise concerning Contractor or its operation and shall not disclose nor allow to be disclosed the same to any third party without the prior written consent of Contractor. Company warrants that its personnel are aware of and shall comply with the provisions of this sub-clause 7.2.  Excepted from this undertaking is any information or media already in the public domain or which is required to be disclosed by law or legal process.

 

Company to pay, and/or indemnify the Contractor for, all local, State, National taxes and/or dues assessed on the vessel BOS Angler or the Contractor by the Republic of Guinea resulting from the Company's orders herein, whether assessed during or after the currency of this Agreement including but not limited to any income taxes, remittance taxes, withholding taxes, contractor's taxes, gross receipt taxes, social security taxes, social insurance charges, value added taxes, property taxes, excise taxes and stamp duties. Any such assessments by the Republic of Guinea will be immediately forwarded to Company to handle.

9.1

In Section 2 of this Agreement, the Parties have agreed the scope of the Services to be provided and the compensation for such Services. Should Company require additional or different Services or in any way change or modify the scope, parameters or content of the Services from that previously agreed (the "Additional Services"), Contractor shall be entitled to additional compensation. The amount of such additional compensation shall be determined by the Parties with due regard to the rates of compensation due for the Services previously agreed. However, Contractor shall not be required to commence the Additional Services until the Parties have mutually agreed to the compensation due for the Additional Services.

9.2

Contractor shall present invoices in accordance with the payment schedule agreed between the Parties, or if none is specified, and at Contractor’s option, such invoices may be presented on the 3rd day and 18th day of each month or at the end of each completed stage during the progress of the Services. Invoices shall quote Company’s contract reference number (if any), and shall be calculated in accordance with the sums, rates, charges and other provisions of this Agreement and shall be for the amount due for the Services performed to date less the amount of any previous invoice.

9.3

Company shall pay by bank wire transfer direct to Contractor’s bank account or as otherwise directed, or as otherwise agreed herein (such as payment options provided for in section 10 below regarding the sale of Deposit Shares and Cash Proceeds which may be available in Deposit Account for Company to treat as Applied Cash Proceeds) within fifteen (15) days of receipt of invoice all undisputed amounts due under that invoice.

9.4

Company agrees that should any portion of an invoice be disputed, Company shall promptly pay the non-disputed portion.

9.5

Within fifteen (15) days of receipt of an invoice, Company shall promptly notify Contractor in writing of the reasons for disputing all or part of that invoice and Contractor shall promptly produce such evidence as it may have in support of the disputed amount. Having due regard to all the facts, the Parties shall seek to reach agreement as to how much, if any, of such disputed amount should be paid. Failing agreement, the matter may be referred to arbitration in accordance with Clause 24.  If no notice is given by the 15th day following receipt of an invoice, it shall be presumed that Company has no dispute therewith.

9.6

Contractor may at its absolute discretion charge interest, which Company shall promptly pay, on all amounts not paid strictly in accordance with the payment terms of this Clause 9 or as otherwise agreed herein. Interest shall accrue at 1% per month.

 

10.1

        A deposit for this Agreement of 2,500,000 shares of common stock , currently representing approximately 4.4% of the outstanding shares of Hyperdynamics Corporation’s unregistered restricted common stock, listed with the American Stock Exchange (AMEX Symbol: HDY - herein referred to as “Deposit Shares” or “Deposit Stock”) with an agreed value of $4,075,000 shall be made by the Company’s parent company Hyperdynamics Corporation.  SCS Corporation is a wholly owned subsidiary of Hyperdynamics Corporation.  For the purposes of the rest of this article of the Agreement, Company means collectively both Hyperdynamics Corporation and SCS Corporation.  This deposit shall act as collateral for the remaining mobilization payment of $1,100,000 due within 8 weeks of the initial payment of $500,000.  If the Company does not timely pay this remaining mobilization fee, the Contractor may begin to sell the Deposit Shares to satisfy the remaining mobilization fee.

 

10.2

        To issue the Deposit Shares, restricted common stock certificates with restrictive legend will be issued to and in the name of Bergen Oil Field Services AS (Contractor) within 30 days of signing of contract and after the stock has been listed on the American Stock Exchange (AMEX) with   a Listing of Additional Shares (LAS) application being approved by the AMEX.  These Deposit Shares will be delivered to Contractor and at their specific direction for international delivery service such as DHL or Federal Express.

 

10.3

        Upon the six month anniversary of issuance of the Deposit Stock, should it remain issued and outstanding, the Deposit Stock will be deposited into an electronic stock trading account (the “Deposit Account”) with C.K. Cooper or other mutually agreed registered FINRA broker dealer, registered and licensed in the United States. The broker dealer receiving the shares for deposit will be referred to herein as the “Deposit Manager”. Once the Deposit Account is established and the Deposit Shares deposited, the Deposit Manager will be immediately instructed by Contractor to begin selling the Deposit Shares in accordance with SEC regulations for 144 restricted stock sales and such Deposit Manager will be instructed by Contractor to sell only a specified maximum number of shares on any one trading day calculated as follows:

 

Total average trading volume per day for the prior 90 days as calculated and reported by Yahoo Financial’s website, multiplied by 5%.   Thus, as an example: On any particular trading day, presuming the reported average daily trading volume for the last 90 days as reported by Yahoo Financial is 300,000 shares, then the maximum shares eligible to be sold on that particular trading day is (300,000 x 5%) 15,000 shares.

 

10.4

        The Deposit Manager will be obligated, by the specific instruction of the Contractor, to send daily trading records, sales details, and balances of the Deposit Stock and any cash balances from the proceeds of the sale of Deposit Shares to Company, at the close of each business day via email to Hyperdynamics Corporation as follows:   ***@***.  The Contractor may optionally arrange for a view and report only login ability for the Company to view all the activity in the Deposit Account.

 

10.5

        The Contractor may at any time move cash sales proceeds realized from the sale of Deposit Shares (herein referred to as the “Cash Proceeds” or “proceeds”) into any other account of Contractor, but immediately upon doing so, Contractor must notify Company with a memo via email that specifies which outstanding invoices that Contractor is applying such Cash Proceeds to.  Such application of proceeds must be made to the oldest outstanding invoice(s) first.  No Cash Proceeds shall be moved by Contractor from Deposit Account unless there are legitimate outstanding invoice(s) to apply such proceeds to. 

 

10.6

        On the due date of any outstanding invoice(s) due to Contractor by Company under this Agreement, Company may elect to do the following to pay for such legitimate and undisputed outstanding invoice(s):

 

a.

Pay outstanding invoice(s) in their entirety in cash by wire transfer;   or

 

b.

Pay any portion of the outstanding invoice(s) with Cash Proceeds available in the Contractor’s Deposit Account that have already cleared with the Cash Proceeds deposited after the prior sale of Deposit Stock.  This form of payment will be referred to herein as an “Applied Cash Proceeds” payment.  In such case the Company will email a memo to the Contractor of how much of the cash in the Deposit Account is to be applied to which invoice(s) that become due. Such amount designated will be considered the “Applied Cash Proceeds” to pay all or parts of such outstanding and due invoice(s).  It will be the sole responsibility of the Contractor to move such Applied Cash Proceeds out of the Deposit Account to its other cash accounts. Any remaining balance of cash required to pay off the invoice(s) that are due must be paid by Company by cash wire transfer as provided for herein within the agreed upon terms.

 

10.7

        Once the Deposit Manager begins selling the Deposit Shares, the Company at any time prior to all of the Deposit Shares being sold, notice the Contractor by email and redeem any Deposit Shares remaining unsold in the Deposit Account, for a price of $6 per share, by wiring the appropriate amount to the Deposit Account.  In such case the shares will be transferred to the Company immediately by electronic transfer (DTC) and no more Deposit Shares may be sold.

 

10.8

        Also after the Deposit Manager has begun selling the shares, and at any time there are no more invoice balances outstanding that were generated from the 3-D survey and processing work associated with this Agreement, then no more Deposit Shares will be sold by Contractor and Contractor will instruct Deposit Manager not to sell any more Deposit Shares.  At such time as the parties agree that all obligations under the Agreement have been fulfilled, then any remaining unapplied Sales Proceeds and Deposit Shares, at the option of the Company, will be refunded directly to the Company and the Deposit Account closed. 

 

However, if the Company agrees and approves, upon request of Contractor to Company, then any remaining unapplied Sales Proceeds may be applied as Company’s credit towards future work with the Contractor.  Also upon the Company’s agreement and approval, any remaining Deposit Shares may be sold by Contractor, or at Contractors risk held by Contractor.  In this case, if the stock is sold, the net Sales Proceeds amount from the sale of the remaining Deposit Stock shall be credited by Contractor to Company’s account to be available to pay for future services. 

 

Should the Contractor decide (the “Decision”) not to sell the Deposit Stock, then Company shall receive a credit against future work based on the number of Deposit Shares remaining times the closing last sales price reported by the AMEX on the date of the Decision.  In this case, as approved by the Company, the remaining Deposit Shares would remain as an asset owned by Contractor with no further encumbrances and the risk of loss in the future on such remaining Deposit Shares shall be born entirely by Contractor. 

11.1

Contractor shall keep and preserve accurate accounts and records in accordance with generally accepted accounting principles and practices, showing all quantities consumed and costs and charges incurred pertaining to the Services.

11.2

For the purpose of reviewing and verifying the costs of cost reimbursable items and the quantities of both these and of items or expenses reimbursable on a cost or “cost-plus” basis, or as called for under this Agreement, Company or its authorised representatives shall have access, at all reasonable and mutually agreed to times, to all the accounts and records of Contractor pertaining to the Services only.

11.3

If as a result of any review or audit the invoices submitted in accordance with Clause 9 are found to be in error, such errors shall be adjusted in the next invoice issued, or by issuance of an additional invoice or credit note.

11.4

The provisions of this Clause 11 shall be valid only one (1) year after the invoice including said reimbursable items has been issued.

11.5

Nothing herein shall entitle company or its authorised representatives to access to any of Contractor’s privileged, confidential, trade-secret or "other-client" information or documents.

12.1

Contractor shall provide all personnel necessary to carry out the Services ("Contractor’s Personnel"). Contractor shall be responsible for the payment of wages, salaries and all other remuneration or benefits due to Contractor’s Personnel, for safety measures, for payment of compensation in respect of accident or injury or occupational disease, and for payment of any and all contributions to the tax or other Governmental authorities in respect of Contractor’s Personnel, and shall defend, hold harmless and reimburse Company for any expense which Company may incur as  a result of Contractor’s failure to comply with such responsibility.

12.2

Contractor’s Personnel shall be skilled and experienced in their several trades and callings. Company may upon showing good cause request in writing the removal of any of Contractor’s Personnel who are prejudicing the proper performance of the Services. Contractor shall promptly at its own cost replace such personnel.

12.3

Contractor shall ensure that its personnel comply with any applicable immigration law and hold work permits when required, details of which shall be submitted to Company upon request.

12.4

If the Services involve close liaison and cooperation between Company personnel and any of Contractor’s Personnel, Contractor shall not voluntarily reassign such personnel from the Services without reasonable notice to Company, and in any event only upon providing a satisfactory replacement.

12.5

If Contractor is performing the Services in a location other than his own place of business, Contractor and Contractor’s Personnel will comply fully with all the procedures and regulations applicable to that location of which it has been made aware.

13.1

Provided Company gives Contractor an adequate opportunity, Contractor shall familiarize itself completely with all locations at which the Services are to be performed and the hazards which might be encountered in carrying out the Services, as far as is reasonably practicable.

13.2

Contractor shall take all reasonable safety measures in relation to the type of work undertaken and shall conduct its operations in such a way as to comply at all times with its obligations and duties under all legislation, regulations and enactments relating to health and safety matters applicable to the locations at which the Services are performed.

13.3

Company shall give Contractor adequate notice of any Company safety rules and applicable to the Services (including any relating to illicit drugs, alcohol and firearms) and shall also, if required by Company, appoint a Safety Officer who shall be responsible for all safety matters relating to Contractor’s Personnel.

13.4

Contractor shall cooperate fully with, and shall comply with any lawful directions from, the police, Company, safety officials and fire authorities should any of them consider there to be a safety hazard and request Contractor to alter its mode of operations.

14.1

Except as set forth in Clause 4.3 of Section 2 above, each Party (as indemnitor) shall defend, indemnify and hold harmless the other Party (as indemnitee) from and against any and all liability, causes of action, actions, claims, demands, suits, damages, losses, costs and expenses (including reasonable attorneys fees) for property damage or loss and/or personal injury, illness or death incurred by the indemnifying Party, its affiliated companies, co-venturers, partners, other contractors, sub-contractors, agents,  representatives and all their respective employees, officers and directors.

14.2

All claims of third parties shall be determined at law.

14.3

Neither Company nor Contractor shall be liable to the other for loss of production, loss of profits, loss of business, loss or damage to a well, formation or reservoir, damage or injury resulting from pollution originating in a well, formation or reservoir, inaccuracy of any data or incorrect interpretation or recommendation, or any other indirect or consequential damages, including, inter-alia, special and punitive damages.

14.4

Notwithstanding anything to the contrary contained herein, in no event shall Contractor be liable for any subsea or submerged equipment of any type located within the Survey Area and belonging to the Company Group, their contractors or any third party and Company shall defend, indemnify and hold Contractor Group harmless from and against any and all claims relating to the loss of or damage to any such equipment, whether or not resulting from any act or omission, breach of duty, statutory or otherwise, or the negligence in any form of Contractor Group.

14.5

Unless stated otherwise above, the exclusions of liability and indemnities contained in this Clause 13, shall apply to any such injury, illness, death, loss or damage, without regard to the cause(s) thereof including, without limitation, unseaworthiness, strict liability, negligence, gross negligence or wilful misconduct, ultra-hazardous activity, breach of express or implied warranty, breach of duty, imperfection of material, defect of failure of equipment, defect or "ruin" or other condition of premises, or the sole, joint or concurrent negligence or other fault of the indemnified Party or its owners, directors, officers, employees, agents and/or representatives.

14.6

For the purposes of this Clause 13 and with regard to when acting only as an indemnitee, "Company", "Contractor" and "Party" shall include such Party’s parent, subsidiary and affiliated companies (where affiliated means any entity more than 50% owned or controlled, either directly or indirectly, by said Party’s ultimate parent company), subcontractors, coventurers and other contractors, and their respective owners, shareholders, directors, officers and employees (where any person provided by a Party in connection with the Services shall be deemed that Party’s employee).

14.7

The Parties agree that Contractor’s liability, if any, to the Company or HDY under this Agreement shall not exceed the aggregate amount of payments received by Contractor for its services under this Agreement and Company shall indemnify and hold harmless Contractor for any amounts in excess thereof.

15.1

Without limiting the indemnity obligations or liabilities of Contractor at any and all times during the terms of this Agreement, Contractor agrees to carry insurance of the types and in minimum amounts (shown in US dollars) as follows:

 

a)

Workmen’s Compensation insurance in full compliance with applicable laws and regulations of the area where the Services are performed;

 

b)

Employer’s Liability insurance, with minimum limits of $ 1,000,000.00 per occurrence, covering injury or death to any employee which may be outside the scope of the Workman’s Compensation statue of the area where the Services are performed.

 

c)

General Third Party Liability Insurance, including but not limited to Contractual Liability insurance, in full compliance with any applicable laws and regulations of the area where the Services are performed, with minimum limits of $ 1,000,000.00 for personal injury, death and property damage per occurrence.

 

d)

(i)

Protection and indemnity insurance to at least the declared value of the vessel.

 

(ii)

   Hull and machinery insurance covering the vessel and all inboard and over the side equipment.

 

e)

Insurance of tapes while at Contractor’s risk.

 

f)

any other cover required by law.

15.2

All such insurance shall be carried by Contractor at Contractor’s expense with an insurance company or companies satisfactory to Company and authorised to do business in the area where the Services are to be performed. Said insurance shall not be cancelled or changed materially without fourteen (14) days prior written notice to Company. For liabilities assumed hereunder by Contractor, Contractor’s insurance shall be endorsed to provide that the insurer(s) waive all right(s) of subrogation against Company except as to workers compensation paid. Company likewise shall cause its insurer(s), if any, to waive all right(s) of subrogation against Contractor for liabilities Company assumes hereunder. If requested by Company, Contractor shall furnish evidence of insurance coverage as required above.

15.3

Company may request Contractor to amend the insurances listed above or the cover specified therein. To the extent that this is possible, and to the extent that Contractor is in agreement, such amendments will be made and witnessed by a side letter agreement. Any increase in premiums resulting from these amendments will be paid by Company upon presentation of corresponding invoices.

 

Contractor and Company respectively agree to comply with all laws, rules and regulations, whether municipal, regional and/or national which are applicable to the Services or operations covered by this Agreement or rising out of the performance of such Services operations. If either Party is required to pay any fine or penalty resulting from the other Party’s failure to comply with such laws, rules or regulations, the Party failing to comply shall immediately reimburse the other for any such payment except as otherwise provided in Clause 13 of this Agreement.

 

Contractor represents to Company that no director, officer, employee or agent of Contractor or of any subcontractor or vendor of Contractor, has given or received or shall give or receive any commission, fee, rebate, gift, entertainment or other payment or remuneration of significant cost or value to or from Company, its directors, officers, employees or agents, in connection with the Services to be performed by Contractor hereunder. Likewise, Company represents to Contractor that no director, officer, employee or agent of Company has given or received, or shall give or receive any similar payments to or from Contractor, its directors, officers, employees or agents, in connection with the Services to be performed by Contractor hereunder. Both Parties hereto shall promptly notify the other in the event of any violation of the above subclause by an employee or representative of either Party and both Parties agree to take all reasonable action necessary to address and correct the violation.

18.1

Contractor shall defend at its sole expense any and all legal proceedings brought against Company claiming infringement of patent or copyright or other intellectual property right based upon any method, material or equipment (excluding any such method, material or equipment provided by Company to Contractor) used or provided by Contractor in performance of the Services, and Contractor shall indemnify and hold Company harmless from and against any judgment by a court of competent jurisdiction for damages arising from any such claim, provided that Company lends its full cooperation to Contractor in the defence of such claim.  Contractor shall have the sole right to control the defence of such claim.

18.2

Company  represents and warrants that any and all data, information, documents, material, supplies and equipment provided by it to Contractor, or any method, process or technique which Company requires Contractor to use, is the rightful property of Company and Company has full right to supply such items to Contractor. Company agrees to defend, indemnify and hold Contractor, harmless from and against any damage, loss, cost and/or expense (including attorneys fees) resulting from a breach of this representation and warranty.

19.1

Contractor shall be responsible for applying for all necessary export licenses (if any) required to carry out the Services, and Company shall fully cooperate with Contractor to supply all relevant information and details about Company and its operations including provision of end-user certificates or other documentation that may be required by the appropriate licensing authority.

19.2

Contractor shall use its reasonable endeavours to ensure that all relevant export licenses are granted so as to meet the time schedule for performance of the Services. However, Contractor shall not be liable for any failure or delay in commencement or provision of the Services arising from failure to obtain said licenses in a timely manner or at all.

19.3

Equipment and technology provided to Company by Contractor in performance of the Services may be subject to United States or other countries export licensing laws and controls, and may be licensed for ultimate destination only in the country in which the Services are to be performed. Diversion contrary to law is prohibited. Company shall not export or re-export such equipment or technology without first obtaining Contractor’s written permission and the necessary licenses or authorizations from the relevant export control authorities.

20.1

Contractor shall be solely responsible for, shall bear, shall pay and shall file timely tax returns for all taxes and other charges levied or assessed by any and all governmental agencies having jurisdiction, to the extent that such taxes and other charges are imposed on, arise out of, or are related to Contractor’s equipment or other property, the work, or its performance under this Agreement. Such taxes and other charges shall include, by way of illustration and not limitation, income taxes, remittance taxes, withholding taxes, contractor’s taxes, gross receipts taxes, social security taxes, social insurance charges, value added taxes, property taxes, excise taxes, and stamp duties.

20.2

Contractor shall comply with all governmental requirements regarding reporting, filing of returns, and maintenance of books and records; and Contractor shall pay all costs of such compliance.

 

Contractor agrees to pay all rightful claims for labour, materials, services and supplies furnished by Contractor hereunder and agrees to allow no lien, charge or charging order for same to be fixed upon any of Company’s real or personal property.  Likewise, Company agrees to pay all rightful claims for labour, materials, services and supplies furnished by Company hereunder and agrees to allow no lien, charge or charging for same to be fixed upon any of Contractor’s real or personal property (including vehicles or vessels).

22.1

Operations under this Agreement shall terminate upon completion of the Services which Contractor has contracted to perform, or at the conclusion of the time period agreed by the Parties, whichever occurs earlier. The Parties agree that the Services provided by Contractor cannot be cancelled or terminated by Company early without first reaching an agreement on an early termination fee to be paid to Contractor.

22.2

If either Party is in default of its obligations hereunder to the extent that performance of the Services is materially affected, the other Party shall give written notice to the defaulting Party of such default requiring it to be remedied within a reasonable period, bearing in mind the nature and severity of the default, and in any event not being less than two (2) weeks. If the default is not rectified within the specified period, then said other  Party may terminate this Agreement forthwith by prior written notice.

22.3

If either Party is put into liquidation or has a receiver or manager appointed or makes an arrangement or composition with its creditors or a debenture holder exercises powers of possession of property or management or otherwise interferes with its business, then the other Party may terminate this Agreement forthwith by prior written notice. This sub-clause shall not apply to either Party's own internal re-structuring.

22.4

Termination shall be without prejudice to the rights of either Party arising before such termination, including without limitation Contractor’s right to be paid all amounts due to it up to termination.

23.1

Except as expressly provided, Contractor may not assign, sub-contract any part of the obligations or benefits of this Agreement except with the consent of the Company. Both Parties shall have the right to assign this Agreement to any of its parent or subsidiary companies or to the other affiliated companies of its parent companies

23.2

If Company assigns this Agreement, Company shall remain liable for any obligations owed to Contractor under this Agreement in the event Company’s assignee fails to honour such obligations.

24.1

"Force Majeure" shall mean any act or event which is outside the reasonable control of Company or Contractor including, without prejudice to the foregoing generality, Act of God, epidemic, tidal wave, explosion, lightning, earthquake, hurricane, war (whether declared or not), riots and strikes and industrial action, civil and military disturbance, acts of terrorism and acts of government or governmental authority or of a representative thereof.

24.2

If either Party is prevented from or delayed in performing its obligations hereunder as a result of Force Majeure, such prevention or delay shall not be considered a breach of the Agreement, but shall for the duration of such event relieve the Parties of their respective obligations (except as to payment) under the Agreement.

24.3

During any Force Majeure, Contractor shall be compensated at the Stand-by rate. Should the Force Majeure suspension period last for more than fourteen (14) days, either Party may terminate this Agreement. In the event of such termination, Contractor shall be paid for all work done, and the Demobilisation fee.

 

Unless otherwise agreed in writing by the Parties, the following terms shall apply:

25.1

Any dispute, controversy or claim arising out of or in connection with this Agreement, or the breach, termination or validity thereof, shall be settled by final and binding arbitration in accordance with the United Nations Commission on International Trade Law (“UNCITRAL”) Arbitration Rules as such rules may exist from time to time.

25.2

The arbitration shall be heard and determined by one arbitrator, who shall be jointly appointed by the Parties. If the Parties are unable to agree an arbitrator, the arbitrator shall be appointed by the London Court of Arbitration or some other proper authority agreed by the Parties.

25.3

The arbitration shall take place in and all disputes shall be determined in accordance with the laws of the jurisdiction indicated below:

 

·

England (London)

25.4

N/A

25.5

The award shall be made and shall be payable in USD free of any tax or any other deduction.

25.6

The award shall include interest from the date of any breach or other violation of this Agreement. The arbitrator shall also fix an appropriate rate of interest from the date of the breach or other violation to the date when the award is paid in full.

25.7

In no event, however, should the interest rate during such period be lower than the LIBOR rate in existence on the date of the arbitrator’s decision, nor higher than 12%.

25.8

The Parties agree that the award of the arbitrator will be the sole and exclusive remedy between them regarding any and all disputes arising in connection with this Agreement and shall not be appealable. The award of the arbitrator may, however, be enforced by application to any proper court with jurisdiction over the Parties.  If any provision or award of the arbitration should be deemed to be unenforceable in the jurisdiction in which it is being enforced, then said provision or award shall be deemed to be modified to remove any such objectionable provision so as to make the remainder of the award enforceable.

25.9

This Agreement shall be construed and interpreted in accordance with the laws of the jurisdiction selected in Clause 24.3 above.

25.10

All notices to be given in connection with the arbitration shall be in accordance with Clause 26 hereof.

26.1

This Agreement constitutes the whole agreement between the Parties concerning the subject matter hereof and supersedes any previous oral or written agreements relating to said subject matter.

26.2

The provisions of this Agreement can not be varied or waived except in writing signed by the duly authorised representatives of the Parties and failure by either Party to exercise a right (including the right to enforce an obligation of the other) shall not constitute a waiver of such right and shall not prevent that Party from exercising that right at a later stage.

 

Any notice to be given hereunder shall be in writing and shall be properly given if delivered by hand or sent by registered post, DHL or Federal Express or recorded delivery or by telex or fax confirmed by a letter within 24 hours to Company or Contractor at the relevant address set below or at such another address as may from time to time be notified. A notice shall be deemed to be received at the time of delivery if by hand, DHL or Federal Express, on completion of the transmission if by telex, and 14 days (national) or 30 days (international) after the date of delivery to the postal authorities if by post, provided that if such time is outside normal working hours of the place where such notice is received is shall not be deemed received until two normal working hours thereafter.

 

The English language shall be used throughout in all exchanges between the Parties including all communication, reports, correspondence, drawings, specifications, calculations and invoices.

 

In the event any provision, clause, sentence or part of these General Conditions is inconsistent with or contrary to any applicable law, the same shall be deemed to be modified to the extent required to comply with said law (it being the intention of both Parties to enforce to the fullest extent all terms of these General Conditions) and as so modified, this Agreement shall continue in full force and effect.

 

Contractor will have a first right of refusal on any 3D survey conducted by Company offshore Republic of Guinea within 12 months of contract signature.

Acquisition mode 1 streamer, single source.

Air pressure Minimum 2,000 psi

Volume

4,320 cu. in.

Source depth

6 m

Shot interval

25 m

Number of streamers

1

Streamer length

8,000 m

Streamer depth

8-10 m

Group interval

12.5 m

Record length

9-10 sec

Sampling rate

2 ms

Medium

3592

Format

Seg D

(see separate doc. for CQ processing)

Primary System

DGPS

Secondary System

DGPS

In sea Positioning

Acoustics

Lump Sum

1)

Lead-in, stretch and active sections:

10% of nominal equipment

2)

Active buoys:

one unit

3)

Other in-water equipment (electronic modules, repeater modules, depth controllers, tension transducers, etc) : 10% of nominal equipment.

·

1)

 

·

 

·

 

·

 

·

 

i.

 

ii.

 

iii.

 

iv.

 

i.

 

ii.