TERMS AND CONDITIONS UNDER WHICH DRILL PIPE, TOOLS AND OTHER EQUIPMENT ARE RENTED
All drill pipe, tools and other EQUIPMENT leased to the Lessee (the “EQUIPMENT”) are possessed, leased, operated or used by the Lessee solely at Lessee’s risk. The Lessee acknowledges that it has selected the EQUIPMENT on the basis of its own judgement and expressly disclaims any reliance upon any statements or representations made by the Lessor or any duty of care in respect of the selection, operation or use of the EQUIPMENT.
THE LESSOR MAKES NO WARRANTY OR REPRESENTATION, EITHER EXPRESS OR IMPLIED, AS TO THE DESIGN OR CONDITION OF, OR AS TO THE QUALITY OF THE MATERIAL, HEREUNDER, AND THE LESSOR DISCLAIMS ANY IMPLIED WARRANTY OF MERCHANTABILITY OR FITNESS OF THE EQUIPMENT FOR ANY PARTICULAR PURPOSE OR AS TO ANY OTHER MATTER, IT BEING AGREED THAT ALL SUCH RISKS, AS BETWEEN THE LESSOR AND THE LESSEE, ARE TO BE BORNE BY THE LESSEE, AND THE BENEFITS OF ANY AND ALL IMPLIED WARRANTIES OF THE LESSOR ARE HEREBY WAIVED BY THE LESSEE
IN NO EVENT SHALL THE LESSOR BY LIABLE FOR ANY INDIRECT, SPECIAL OR CONSEQUENTIAL DAMAGES ARISING OUT OF THE RENTED ITEMS. Any property injury, bodily injury, or personal injury damages or alleged damages arising from the use of the rented items will be the sole responsibility of the Lessee. The Lessee agrees that the Lessor shall not be liable for any damage whether subsurface or not, to any property of the Lessee, or any property upon which the Lessee is in occupation of, incurred as a result of the operation or use of the EQUIPMENT and whether or not caused by the negligence of the Lessor and the Lessee hereby agrees to hold harmless and to indemnify the Lessor against all persons for all personal injuries and/or property damage, whether subsurface or not, incurred as a result of the operation or use of the EQUIPMENT and whether or not caused by the negligence of the Lessor The Lessee shall indemnify and hold harmless the Lessor, its agents, employees, affiliates, directors, and officers from and against any and all claims, demands, losses, costs, damages, actions, suits, or proceedings by Third Parties that arise out of or are attributable to or are alleged to be attributable to the Lessee’s usage of the rented items.
The Lessee agrees that ownership of the EQUIPMENT is and shall at all times remain in the Lessor and that the EQUIPMENT is and shall remain personal property and shall not be attached to our become part of any realty. The Lessee will not sell, secrete, mortgage, assign, transfer, lease, sublet, loan, part with possession of or encumber the EQUIPMENT or the lease of the EQUIPMENT or any interest herein or permit any liens or charges to become effective thereon or permit or attempt to do any of the acts aforesaid. The Lessee agrees to comply with all laws, regulations and ordinances, and all applicable requirements of the manufacturer of the EQUIPMENT applicable to the physical possession, operation, condition, use and maintenance of the EQUIPMENT. The Lessee agrees to obtain all permits and licenses necessary for the operation of the EQUIPMENT.
The Lessee assumes all responsibility for EQUIPMENT while out of possession of the Lessor and agrees to return such EQUIPMENT to the Lessor in as good condition as it was at the effective date of the lease, natural wear and tear from reasonable use thereof excepted. The Lessee will permit the Lessor to have access to and inspect the EQUIPMENT upon the Lessor’s request. All EQUIPMENT lost of damaged beyond repair will be paid for by the Lessee at the new replacement cost and all damaged EQUIPMENT that may be repaired will be repaired by the Lessor and the repairs paid for by the Lessee. Accrued rental charges cannot be applied against the purchase price or cost of repairs such as damaged or lost EQUIPMENT. The Lessee shall, without limiting obligations or liabilities as stated elsewhere in this contract, obtain and continuously maintain at its own expense and costs, the following insurance coverages:
WCB insurance covering all employees engaged in handling rented items in accordance with the statutory requirements or territory having jurisdiction over such employees;
General liability insurance in an amount not less than $5,000,000.00 inclusive limits that will insure for the usage of the rented items in accordance to best practices normal to the Lessee’s industry.
EQUIPMENT insurance, covering all rented items from the Lessor for the period commencing at the time of pickup through to its return to the agreed storage facility. Said insurance shall be on an all risk basis and provide for full replacement cost arising from loss or damage to the rented items.
It is understood and agreed that the Lessee shall add the Lessor as an additional named insured on their general liability insurance policy and that 30 days written notice of cancellation shall be provided. It is agreed that insurers shall waive any rights of subrogation against the Lessor.
All transportation charges will be borne by the Lessee. The Lessee is also responsible for all license fees and assessments and all sales, use , property, excise, and other taxes or charges (including and interest and penalties) imposed upon any EQUIPMENT.
Rental charges begin when EQUIPMENT leaves the Lessor’s yard and continues until returned thereto and are to be made without abatement, reduction or set-off to any nature. Well conditions which prevent satisfactory operation of EQUIPMENT do not relieve the Lessee of its responsibility for rental charges. This lease is made and shall be effective when the EQUIPMENT is delivered to the Lessee or the carrier for delivery to the Lessee. The Lessee has 48 hours after delivery of the EQUIPMENT to inspect and notify the Lessor in writing of unacceptability of the EQUIPMENT. In the absence of such written notice, it is conclusively presumed that the Lessee has fully inspected the EQUIPMENT and that it is in good condition and repair. The lease of the EQUIPMENT may be terminated immediately on demand. Fifteen (15%) percent will be added to all third party charges and sales items. The amount on the invoice must be paid within 35 days of the invoice date. Any payment received past this due date shall be accompanied by an interest penalty calculated at the rate of eighteen (18%) percent per annum thereon, but not in excess of the amount permitted by applicable. Law.
The terms and conditions herein with respect to the lease of the EQUIPMENT shall be governed and construed in accordance with the laws of the Province of Alberta. Should any term or condition or part thereof contained herein be declared invalid, illegal or unenforceable by a court of competent jurisdiction, the remaining enforceable terms and conditions shall continue in full force and effect. The terms and conditions herein are binding upon the Lessee and its respective heirs, successors, administrators, executors and permitted assigns,