Preventative Maintenance Plan
AIRNETIC, INC.
SERVICE AND MAINTENANCE AGREEMENT
RECITALS
A. Customer has purchased certain equipment from Airnetic, which equipment is more particularly described in Schedule 1, attached hereto and incorporated by this reference (the “Equipment”).
B. Customer now desires to purchase Airnetic’s Preventative Maintenance Plan for the Equipment and the Airnetic agrees to supply such Plan Services to the Customer on the terms and conditions set forth below.
NOW, THEREFORE, in consideration of the mutual covenants and premises contained herein, the receipt and sufficiency of which are hereby acknowledged, the parties hereby agree as follows.
1. Purchase of Services
Customer agrees to purchase the Maintenance Service Plan described below and Airnetic agrees to furnish the Maintenance Plan services at the Customer’s installation site of the Equipment and on the Equipment at the time periods described in the Maintenance Worksheet attached hereto and as Schedule 2 and incorporated herein by this reference, subject to all the terms and conditions of this Agreement (collectively, the “Services”).
2. Airnetic’s Obligations
2.1. Maintenance of Equipment
30-POINT PREVENTIVE MAINTENANCE SERVICE PLAN: Airnetic shall, for the total preventive maintenance charges set forth in Schedule 2 hereto, perform a preventive maintenance performance check on the oxygen system and make any necessary system adjustments only, to keep the oxygen system equipment in good working order. If replacement of various Parts are required, due to normal wear and tear, the Customer shall bear all costs of Labor and Parts to replace the required Parts at the rate set forth in Schedule 2 hereto.
2.2. Replacement Parts
Upon notification, either verbal or written, of any Equipment malfunction, Airnetic shall determine if the part is defective and, if so, if the part is covered under the oxygen systems original 1-year Limited Warranty. If not covered under the 1-Year Limited Warranty, Airnetic will supply the customer with a written estimate for Parts and Labor. Upon customer approval of the estimate, Airnetic shall install the replacement parts within a 48 hour period. All inoperative parts become the property of and shall be returned to Airnetic.
2.3. Maintenance Period for On-Site Services
The standard preventive maintenance services include two (2) bi-annual scheduled preventive maintenance visits to the customers equipment location to perform a 30-point performance check on the oxygen system equipment, per the Terms of the customer’s purchased Maintenance Plan.
2.4. Non-Standard Maintenance Services
Airnetic shall, for the additional charges referred to in Section 4.3 below, provide maintenance services and make required repairs to the Equipment when either is required due to causes not attributable to normal wear and tear including, but not limited to:
(i) The failure of Customer to continually maintain the installation site in conformance with Airnetic’s specifications;
(ii) Impairments in the performance of the Equipment resulting from changes in the design of the Equipment made by Customer or mechanical, electrical, or electronic interconnections made by Customer;
(iii) Damage caused by accidents or natural disasters or the negligence of, or improper use or misuse of, the Equipment by Customer;
(iv) Damage or necessity of repair resulting from unauthorized maintenance by Customer or any third party other than Airnetic or its authorized representative; or
(v) Damage or repair necessitated as a result of relocation of the Equipment.
2.5. Third Party Contractors
Airnetic may, at its option, designate an authorized third-party contractor to provide maintenance services to Customer hereunder on behalf of Airnetic. The appointment by Airnetic of such an authorized representative shall not relieve Airnetic of its obligations hereunder.
2.6. Services Outside Maintenance Period
Airnetic shall attempt to be responsive to requests from Customer for maintenance services outside the Maintenance Period, subject to reasonable notice and manpower availability. Such services rendered outside the Maintenance Period shall be performed for the additional charges referred to in Article 4 hereof.
2.7. Customer’s Modifications to Equipment
If Customer, with Airnetic’s prior approval, causes modifications or interconnections to be made or accessories, features, attachments added to the Equipment, then maintenance services shall be furnished with respect thereto only on mutual agreement between Airnetic and Customer and the total monthly maintenance charge shall be adjusted accordingly.
2.8. Airnetic’s Modifications to Equipment
As part of providing maintenance services hereunder, Airnetic sponsored modifications may be made to the Equipment by Airnetic. Customer shall provide time, if required, and ready access for Airnetic’s personnel to the Equipment upon notification from Airnetic that such modifications are ready to be made. The time required shall be mutually agreed upon by Customer and Airnetic, and shall be in addition to the normal preventive maintenance hours. If the modification requires payment by Customer, Airnetic will supply the customer with a written estimate for Parts and Labor. Upon customer approval of the estimate, Airnetic shall perform modifications.
2.9. Title to Tools and Spare Parts
Title to all maintenance tools and spare parts shall remain with Airnetic, except that upon installation of parts into Customer-owned equipment, title to such parts shall pass to Customer.
2.10. Furnishing of Labor and Materials
2.11.1. Airnetic will furnish all labor, equipment, and materials necessary to the performance of the mentioned duties, except such equipment and materials as are to be provided by Customer, as set forth in Exhibit 1.
2.10.2. Airnetic may use such equipment or materials provided by Customer as is necessary to the carryout performance of the mentioned duties, but if such equipment or materials should be lost, damaged, or destroyed, Airnetic will reimburse Customer for their replacement with equipment and materials of equal value, and for costs and expenses incident to such replacement.
2.11. Replacement of Worn Equipment
Schedule 3 attached hereto and incorporated herein by this reference, lists items that inspection shows are considerably worn, and will require replacement soon (the “Worn Parts”). Airnetic accepts the Worn Parts in their present state in order to provide Customer with the maximum service from these items, with the understanding that, in addition to the charge set forth in this agreement, Customer shall receive and approve an estimate to repair/refurbish/replace Worn Parts by Airnetic at additional cost.
2.12. Confidential Information
2.13.1. All information of any nature that is made available by Airnetic or that becomes available to Customer by virtue of this Agreement, or the relationship created by this Agreement, shall be held in strict confidence by Customer. All confidential disclosures that are made by, and all confidential information that is made or becomes available to, Customer is made in reliance on this promise. All restrictions and obligations on Customer under this section shall terminate three (3) years from the expiration of this agreement.
2.12.2. Information given by Customer to Airnetic will not be considered of a confidential nature, regardless of how designated. Airnetic will be required to hold confidential only such Customer information as Airnetic may from time to time agree in writing to so hold. Customer shall designate in writing all information transferred pursuant to such agreement that Customer believes to be proprietary, and Airnetic shall protect such information in the same manner as Customer protects Customer’s own proprietary information. All restrictions and obligations on Airnetic under this section shall terminate three (3) years from the expiration of this agreement.
2.12.3. Information will not be considered proprietary (1) to the extent that it is or becomes public knowledge through no fault or negligence of the party receiving such information, (2) which is rightfully disclosed by some third party, or (3) which is already known to the receiving party and has not been obtained in confidence from the other party prior to the date of this agreement.
3. Customer Obligations
3.1. Storage Space
Customer shall provide, free of charge and with ready access, storage space for maintenance tools and spare parts, working space, heat, light, ventilation, electric current, and outlets for the use of Airnetic’s maintenance personnel. Such facilities shall be within a reasonable distance from the Equipment being maintained.
3.2. Notice of Equipment Failure
Customer shall notify Airnetic’s maintenance personnel immediately upon Equipment failure and shall allow Airnetic full and free access to the Equipment and the use of necessary data communications facilities and equipment at no charge to Airnetic, subject to Customer’s security rules. Customer shall provide technical personnel necessary to assist Airnetic with system trouble shooting.
3.3. Maintenance of Installation Site
Customer shall maintain the installation site throughout the term of maintenance service identified herein in accordance with the specifications established by Airnetic.
3.4. Customer’s Maintenance Efforts
Customer’s personnel shall not perform maintenance or attempt repairs to the Equipment while such Equipment is being maintained under this Agreement, except as specified and approved by Airnetic.
3.5. Customer’s Modifications to Equipment
Customer shall not cause modifications or interconnections to be made, or accessories, attachments, or features to be added to the Equipment being maintained by Airnetic under this Agreement without Airnetic’s prior written approval. Notwithstanding the above, Customer shall be entitled to make mechanical and electrical connections to the Equipment without Airnetic’s prior approval; provided, that if such connections interface with the normal functioning of the Equipment in a manner which increases Airnetic’s cost of maintaining the Equipment or creates a safety hazard, Customer agrees to remove such connections promptly upon notice from Airnetic.
4. Charges and Payments
4.1. Commencement of Maintenance Charges
Customer shall be invoiced upon signing up for the maintenance program. If the program commences in the second half of the calendar year the customer will be billed for one half the annual rate and only receive one service visit that calendar year. Customer shall then be invoiced in full in December for the following year.
4.2. Billing and Payments
The maintenance charges as specified in Schedule 2 shall be invoiced annually in advance. All other charges payable hereunder shall be invoiced for the month in which they have been incurred. All charges hereunder shall be due and payable upon receipt. The rate of interest per annum charged shall be eighteen percent (18%); shall automatically be charged on all amounts, including additional charges, not paid by Customer when due hereunder.
4.3. Additional Maintenance Charges
In addition to the total maintenance charges set forth in Schedule 2 hereto, Customer agrees to pay for:
(i) Labor, parts, and expenses for maintenance or repair due to causes not attributable to normal wear and tear including, without limitation, those instances described in Section 2.5 above;
(ii) Labor and other expenses for maintenance or repairs required due to normal wear and tear performed outside of the Maintenance Period at the request of Customer;
(iii) All travel expenses incurred providing maintenance services outside of the bi-annual maintenance visit;
(iv) All travel expenses for any on-site maintenance services which in the opinion of Airnetic is not deemed necessary; and
(v) Labor, parts, and other expenses for refurbishment and overhaul of Equipment performed by Airnetic at the request of Customer.
All the above additional charges for labor and parts shall be at Airnetic’s published rate in effect at the time such labor and parts are furnished. Charges for labor shall include travel time to and from the installation site. Travel expenses shall be billed at the actual cost to Airnetic of the transportation used. Lodging, food, parking, and toll expenses shall be billed as actually incurred.
4.4. Adjustments
Airnetic may adjust the maintenance charges in Schedule 2 upon the expiration of the initial Term set forth in Article 6 hereof or by giving Customer at least ten (10) days prior written notice in accordance with the provisions of Section 9.4 hereof.
4.5. Taxes
Customer shall pay (or reimburse Airnetic), in addition to the charges for the maintenance services specified herein and as a separate item, all taxes (exclusive of Airnetic net income taxes), however designated, or amounts legally levied in lieu thereof, based on or measured by the charges set forth in this Agreement or on this Agreement, or on the services rendered hereunder, now or hereunder imposed under the authority of any federal, state or local taxing jurisdiction.
5. Parts Warranty and Limitation of Remedies and Liability
AIRNETIC SHALL WARRANTY REPLACEMENT PARTS FOR A PERIOD OF NINETY (90) DAYS ONLY. THE WARRANTIES SET FORTH HEREIN ARE IN LIEU OF ALL OTHER WARRANTIES, EXPRESS OR IMPLIED, WHICH ARE HEREBY DISCLAIMED AND EXCLUDED BY AIRNETIC, INCLUDING WITHOUT LIMITATION ANY WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR USE. AIRNETIC SHALL NOT BE LIABLE FOR ANY LOSS OR DAMAGE CAUSED BY DELAY BY AIRNETIC IN FURNISHING EQUIPMENT AND SERVICES OR ANY OTHER PERFORMANCE UNDER OR PURSUANT TO THIS AGREEMENT. CUSTOMER’S SOLE AND EXCLUSIVE REMEDIES FOR BREACH OF ANY AND ALL WARRANTIES AND FOR AIRNETIC’S LIABILITY OF ANY KIND (INCLUDING LIABILITY FOR NEGLIGENCE) UNDER THIS AGREEMENT SHALL BE LIMITED TO THE REFUNDING OF THE CUSTOMER’S MAINTENANCE FEE SET FORTH IN ARTICLE 4. IN NO EVENT SHALL AIRNETIC BE LIABLE FOR ANY SPECIAL, INDIRECT, INCIDENTAL, OR CONSEQUENTIAL LOSSES OR DAMAGES, EVEN IF AIRNETIC SHALL HAVE BEEN ADVISED OF THE POSSIBILITY OF SUCH POTENTIAL LOSS OR DAMAGE. AIRNETIC’S TOTAL LIABILITY UNDER THIS AGREEMENT FOR ANY REASON SHALL NOT EXCEED THE TOTAL AMOUNT RECEIVED BY AIRNETIC FROM CUSTOMER UNDER THIS AGREEMENT.
5.1. Indemnification of Airnetic
5.1.1. Customer will indemnify Airnetic against all liability, losses, fines or judgment, including costs, attorney fees and other expenses, for death or injuries to persons or property arising out of or in connection with Airnetic’s performance of the described duties, unless caused by the gross negligence or willful misconduct of Airnetic.
5.1.2. Airnetic will give Customer prompt written notice of any demand, claim, or suit against Airnetic, and Customer shall not have the right to compromise or defend the matter except as expressly directed and agreed to in writing by Airnetic.
6. Term
This Agreement shall become effective as of the date accepted and signed by Airnetic and shall continue for an initial term of one year years from the Commencement Date, unless earlier termination pursuant to Article 7 below, and shall remain in effect thereafter until termination by either party on thirty (30) days’ prior written notice to the non-terminating party in accordance with the provisions of Section 9.4 hereof (the “Term”).
7. Termination
7.1. Customer’s Default on Payments
In the event Customer defaults on any payment due under this Agreement, Airnetic shall be entitled to immediately terminate this Agreement on written notice.
7.2. Material Breach
In the event either party commits a material breach of any of its obligations hereunder, except for a default in payment by Customer as provided for in Section 7.1 above, the other party may terminate this Agreement on written notice to the defaulting party unless the defaulting party cures such breach within thirty (30) days of written notice thereof.
7.3. Election To Terminate
Either party may terminate this Agreement on thirty (30) days’ prior written notice to the non-terminating party in accordance with the provisions of Section 9.4 hereof. In the event Customer terminates this Agreement as provided herein, Customer shall have no right to the return of any portion or proration of the Maintenance Charges for the unexpired Term.
7.4. Termination of Equipment Lease
This Agreement shall automatically terminate as to any Equipment covered by a Lease of Equipment Agreement between Customer and Airnetic upon the termination of such Lease of Equipment Agreement.
7.5. Withdrawal of Equipment
Individual machines and other parts of the Equipment may be withdrawn from this Agreement by the Customer on thirty (30) days’ prior written notice to the Airnetic in accordance with the provisions of Section 9.4 hereof. Except as otherwise provided in this Agreement, Airnetic may withdraw individual machines and other parts of the Equipment from this Agreement upon the expiration of the initial term set forth in Article 6 hereof or thereafter by giving Customer at least thirty (30) days prior written notice in accordance with the provisions of Section 9.4 hereof.
7.6. Survival of Customer’s Obligations
Customer’s obligation to pay all charges which shall have accrued hereunder prior to termination of this Agreement shall survive termination, irrespective of the reason.
7.7. Option: Customer’s Right To Postpone Termination
Customer, by written notice to Airnetic, may defer the actual termination date of this agreement up to one (1) months to enable Customer to make appropriate provision for the handling of the functions performed by Airnetic without loss of performance time. Any such extension shall be on the terms and conditions contained in this Agreement.
8. Force Majeure
8.1. Definition
Force Majeure shall mean any event or condition, not existing as of the date of signature of this Agreement, not reasonably foreseeable as of such date and not reasonably within the control of either party, which prevents in whole or in material part of the performance by one of the parties of its obligations hereunder or which renders the performance of such obligations so difficult or costly as to make such performance commercially unreasonable. Without limiting the foregoing, the following shall constitute events or conditions of Force Majeure: acts of state or governmental actions, riots, disturbances, war, strikes, lockouts, slowdowns, prolonged shortage of energy Airnetic, material shortages, epidemics, fire, flood, earthquake, lightning, and explosion.
8.2. Notice and Consequences
Upon giving notice to the other party, a party affected by an event of Force Majeure shall be released without any liability on its part from the performance of its obligations under this Agreement, except for the obligation to pay any amounts due and owing hereunder, but only to the extent and only for the period that is performance of such obligations is prevented the event of Force Majeure. Such notice shall include a description of the nature of the event of Force Majeure, and its cause and possible consequences. The party claiming Force Majeure shall promptly notify the other party of the termination of such event. During the period that the performance by one of the parties of its obligations under this Agreement has been suspended by reason of any event of Force Majeure, the other party may likewise suspend the performance of all of its obligations hereunder to the extent that such suspension is commercially reasonable.
8.3. Termination Rights
Should the period of Force Majeure continue for more than two (2) consecutive months, either party may terminate this Agreement without liability to the other party, except for payments due to such date, upon giving written notice to the other party.
9. General Terms and Conditions
9.1. Assignment
Neither party shall have the right to assign or otherwise transfer its right and obligations under this Agreement except with the written consent of the other party; provided, that a successor in interest by merger, operation of law, assignment or purchase, or otherwise of the entire business of either party shall acquire all interest of such party hereunder and provided further that Airnetic shall be entitled to assign all or part of the payments from Customer under this Agreement to any person or organization in its own right or as agent for trustee and Customer agrees to comply with any instructions from Airnetic to make payments directly to such persons or organizations. Any prohibited assignment shall be null and void.
9.2. Entire Agreement
THIS AGREEMENT, INCLUDING SCHEDULES 1, 2 and 3, AND EXHIBIT 1 ATTACHED HERETO AND INCORPORATED AS AN INTEGRAL PART OF THIS AGREEMENT, CONSTITUTES THE ENTIRE AGREEMENT OF THE PARTIES WITH RESPECT TO THE SUBJECT MATTER HEREOF, AND SUPERSEDES ALL PREVIOUS PROPOSALS, ORAL OR WRITTEN, AND ALL NEGOTIATIONS, CONVERSATIONS OR DISCUSSIONS HERETOFORE HAD BETWEEN THE PARTIES RELATED TO THIS AGREEMENT. CUSTOMER ACKNOWLEDGES THAT IT HAS NOT BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY ANY REPRESENTATIONS OR STATEMENTS, ORAL OR WRITTEN, NOT EXPRESSLY CONTAINED HEREIN.
9.3. Amendments
This Agreement shall not be deemed or construed to be modified, amended, rescinded, canceled or waived, in whole or in part, except by written amendment signed by the parties hereto.
9.4. Notices
Notices permitted or required to be given hereunder shall be deemed sufficient if given by registered or certified air mail, postage prepaid, return receipt requested, addressed to the respective addresses or the parties as first above written or at such other addresses as the respective parties may designate by like notice from time to time. Notices so given shall be effective as of the date stamped on the receipt.
9.5. Severability
In the event that any of the terms of this Agreement are in conflict with any rule of laws, regulations, provisions or otherwise unenforceable under the laws or regulations of any government or subdivision thereof, such terms shall be deemed stricken from this Agreement, but such invalidity or unenforceability shall not invalidate any of the other terms of this Agreement and this Agreement such continue in force, unless the invalidity or unenforceability of any such provisions hereof does substantial violence to, or where the invalid or unenforceable provisions comprise an integral part of, or are otherwise inseparable from, the remainder of this Agreement.
9.6. Governing Law
This Agreement shall be governed by and construed in accordance with the laws of the State of Nevada excluding its principles of conflicts of laws and the parties hereto irrevocably commit to the jurisdiction and venue of the courts of Clark County, Nevada to resolve any disputes arising hereunder or related hereto.
9.7. Conflicting Terms
The terms and conditions of this Agreement shall prevail over any additional or contrary terms which may be contained in any instructions or other communications submitted to Airnetic by Customer.
9.8. Independent Contractor
The parties intend that Airnetic, in performing services specified in this Agreement, shall act as an independent contractor and shall have complete control of the work and the manner in which it is performed. Airnetic is not to be considered an agent or employee of Customer and is not entitled to participate in any pension plans, or in bonus, stock, or similar benefits that Customer provides for its employees.
9.9 General Limitations and Exclusions
Nothing contained herein shall require Airnetic to repair or replace any defects, shortcomings, or imperfections resulting from customer-furnished designs, goods, equipment, services or materials and do not apply to any equipment or services or parts thereof which Airnetic determines: (1) to have been improperly installed or repaired; (2) to have been altered or modified in any way without Airnetic’s prior written approval; (3) to have been subjected to misuse, abuse, excessive external forces, negligence, intentional acts, or accident; (4) to have been installed, stored, used, or operated in a manner contrary to Airnetic’s instructions, specifications and drawings, outside the specified design conditions, or not used in accordance with normal operating and maintenance instructions; (5) are purchased as used equipment, a prototype or a sample; or (6) result from the act, omission, or negligence of customer or customer’s guests, invitees, licensee’s, customers, clients, employees, contractors, officers, agents, managers, members, partners, trustees, or any of Customer’s respective affiliates.