Catalyst Artificial Lift, LLC

TERMS AND CONDITIONS OF PURCHASE

THIS AGREEMENT CONTAINS PROVISIONS RELATING TO ALLOCATION OF RISK, INCLUDING BUT NOT LIMITED TO INDEMNITY, RELEASE, LIMITATION OF LIABILITY AND INSURANCE REQUIREMENTS.

QUANTITIES: Quantities specified in the Order may be increased by Seller as necessary to meet its minimum charge requirements, if any. Otherwise, shipments in excess of the quantities specified in this Order, without permission of Buyer, are subject to return for credit at Buyer’s option and at Seller’s expense.

CANCELLATION: Buyer reserves the right to cancel the Order or make changes in quantities, specifications and/or delivery schedules: (i) if material is not shipped as specified; (ii) for failure to comply with or a breach of these Conditions by Seller; (iii) for causes due to fires, strikes, or any causes beyond Buyer’s control; or (iv) if the Goods are not in accordance with the representations, warranties and guarantees as herein required from Seller.

WARRANTY AND REPRESENTATION: Seller represents, warrants and guarantees that all goods delivered hereunder (the “Goods”) (i) conform to the description specified or to any specifications, drawings, designs or technical data previously specified; (ii) shall be free of all defects in material, quality or workmanship; (iii) are merchantable and will pass without objection under industry standards and are suitable for the purposes of which they are normally used; (iv) are of U.S. manufacture (unless otherwise specified); (v) are free of any liens or encumbrances, other adverse claims of ownership and claims of infringement on intellectual property rights; (vi) are in conformity with all applicable state, federal and local laws affecting the sale, purchase, manufacture, processing and delivery of the Goods. If the Goods or any of their contents are subject to laws governing safety or hazardous substances, Seller represents and warrants that it has disclosed such considerations to Catalyst Artificial Lift, LLC (hereinafter referred to as “Buyer”). If the Order calls for installation, maintenance or other services, all such services are warranted to be performed in a good and workmanlike manner and in compliance with the highest industry standards and all applicable codes. All warranties extend (for a period of no less than four (4) years from delivery date) and any installation by Seller (or its contractors) shall inure to the benefit of Buyer’s assigns, successors and customers; provided that the warranties concerning liens, encumbrances, ownership and intellectual property rights shall extend for any period of time during which any such rights may be enforced.

INDEMNITY OBLIGATIONS: To the fullest extent permitted by law, Seller hereby agrees to RELEASE, INDEMNIFY, DEFEND AND HOLD HARMLESS BUYER, ITS PARENT, SUBSIDIARIES, AND AFFILIATES AND EACH OF THEIR RESPECTIVE OFFICERS, DIRECTORS, EMPLOYEES, AGENTS, CONTRACTORS OF ANY TIER, REPRESENTATIVES, AND CONSULTANTS (“BUYER GROUP”) FROM ANY AND ALL LIABILITIES, OBLIGATIONS, LOSSES, DAMAGES, ATTORNEYS AND EXPERT FEES, PENALTIES, CLAIMS, ACTIONS AND SUITS (INCLUDING LEGAL EXPENSES OF WHATSOEVER KIND AND NATURE) ARISING OUT OF OR RELATED IN ANY WAY TO THE MANUFACTURE, SALE, DELIVERY, USE, RENTAL, OR REPAIR OF GOODS OR PARTS, OR ANY SERVICES PROVIDED BY SELLER TO BUYER GROUP AND REGARDLESS OF THE NATURE OF THE LIABILITY, OBLIGATION, LOSS, DAMAGE, PENALTY, CLAIM, ACTION OR SUIT BEING SOUGHT OR THE IDENTITY OF THE PARTY SEEKING SAME. THIS RIGHT OF INDEMNITY SHALL EXIST IN FAVOR OF BUYER GROUP EVEN IF BUYER GROUP’S NEGLIGENCE, GROSS NEGLIGENCE, BREACH OF WARRANTY, STRICT LIABILITY, INTENTIONAL CONDUCT, AND/OR STATUTORY OR COMMON LAW FAULT CAUSED OR CONTRIBUTED, IN WHOLE OR IN PART, TO THE LIABILITY, OBLIGATION, LOSS, DAMAGE, PENALTY, CLAIM, ACTION, OR SUIT. Buyer and Seller agree that Seller’s indemnity obligations will be supported by liability insurance coverage to be furnished by Seller in an amount no less than US $500,000. This amount of liability insurance is not designed to limit in any manner the extent and amount of Seller’s indemnity obligations. NOTWITHSTANDING ANYTHING HEREIN TO THE CONTRARY, UNDER NO CIRCUMSTANCES SHALL EITHER PARTY BE LIABLE TO THE OTHER PARTY FOR ANY CONSEQUENTIAL, SPECIAL, INDIRECT, INCIDENTAL, EXEMPLARY OR PUNITIVE DAMAGES, INCLUDING, WITHOUT LIMITATION, LOSS OF PROFITS, LOSS OF BUSINESS OPPORTUNITY OR LOSS OF PROSPECTIVE REVENUE, ARISING OUT OF THIS ORDER OR ANY WORK PERFORMED OR TO BE PERFORMED HEREUNDER.

CONFIDENTIALITY: All drawings, designs, specifications, descriptions, technical data and other information (“Information”) furnished to Seller by Buyer for use with the Order constitute the property and/or trade secrets of Buyer. Seller expressly covenants and agrees that it will treat the Information as strictly confidential and use the Information only to complete the Order and to return the Information upon completion or termination of the Order along with all copies or reproductions thereof. Seller agrees that copies of the Information can be made only with Buyer’s prior written consent.

GENERAL: Any delivery of this Purchase Order (“Order”) hereunder shall constitute an acceptance of the Order pursuant to these terms and conditions (“Conditions”). The Order, together with the terms and conditions contained herein and such other sheets or documents as are expressly made a part hereof, shall, constitute the entire present agreement between the parties. Buyer’s terms and conditions contained herein shall take precedence over any conflicting terms and conditions contained in Seller’s quotation, sales or service order or other documentation or printed form, notwithstanding any language in Seller’s form or agreement to the contrary. If Seller includes or attaches any different and/or additional terms in Seller’s executed acceptance of the Order, Seller expressly agrees that such execution shall constitute an acceptance of these terms and conditions and a binding contract will result solely upon Buyer’s terms and conditions as stated in the Order, which contract will not include Seller’s different and/or additional terms or conditions.

INVOICING: Seller shall submit invoices, in number of copies specified on the face of this Order, on date of shipment for each and every separate shipment. Delays in receiving invoices, errors, or omissions shall be considered just cause for withholding payment without loss of cash or time discount privileges.

PRICE PROTECTION: It is understood and agreed that Seller will not charge, without Buyer’s consent, a higher price for the Goods specified in this Order. If reference to the price is omitted from the Order or any acknowledgment thereto, it is agreed that the items herein ordered shall be priced at that figure which was last quoted by Seller to or paid by Buyer or at the prevailing market price, whichever is lowest.

SHIPMENTS: There shall be no charge for packing or crating, unless noted on the face of the Order. All Goods must be so packed as to secure lowest possible freight rates and must be shipped by the most cost-efficient means possible to ensure timely, safe transportation with no accompanying loss, unless otherwise noted. Buyer shall be notified as soon as possible when shipments will be made and of shipments made (all shipments should also include M.T.R.’s)

INSPECTION: Buyer shall have the right to inspect all Goods ordered in Seller’s possession before shipment and after arrival at any shipping destination. Buyer may reject any and all Goods not conforming to any applicable plan, specification or description. Such rejected Goods held by Buyer or by any affected third party pending Seller’s disposition will be at Seller’s sole risk and expense.

ASSIGNMENTS: Neither the Order nor any interest or rights therein shall be assigned or transferred by Seller without Buyer’s prior written approval. Buyer reserves the right, and it may at any time assign the Order, and any and all rights hereunder.

PRODUCT ALERTS: In order to assure the proper and safe use of Goods, Seller warrants that it shall furnish together with all Goods offered all appropriate so-called “product warnings” adequate to permit such proper and safe use of the Goods (including Material Safety Data Sheets).

PATENT INDEMNIFICATION: SELLER AGREES TO DEFEND, PROTECT AND HOLD HARMLESS THE BUYER GROUP AND ITS CUSTOMERS AGAINST ALL CLAIMS, COSTS (INCLUDING EXPERT AND ATTORNEYS’ FEES), AND LIABILITIES FOR INFRINGEMENT OF ANY UNITED STATES OR FOREIGN PATENT, COPYRIGHT, TRADEMARK OR OTHER INTELLECTUAL PROPERTY RIGHT WHICH ARISES FROM THE MANUFACTURE, USE OR SALE OF GOODS OR SERVICES FURNISHED HEREUNDER. FURTHER, WHERE BUYER’S USE OR OTHER BENEFIT FROM THE GOODS SHOULD BE ADVERSELY AFFECTED AS A RESULT OF ANY SUCH CLAIMS, SELLER EXPRESSLY AGREES TO REMEDY, UPON WRITTEN DEMAND BY BUYER, THE ADVERSE EFFECTS, INCLUDING ITS FURNISHING EQUIVALENT SUBSTITUTE GOODS OF EQUAL OR BETTER QUALITY AND/OR COMPENSATING BUYER FOR THE DAMAGE INCURRED AS A RESULT OF SUCH EFFECTS.

IMPORT/EXPORT: When the Goods (or part thereof) are subject to export control laws and regulations imposed by a government, Seller shall provide Buyer with applicable Export Commodity Classification Numbers and Harmonized Tariff Schedule Numbers per good including certificates of manufacture in accordance with the origin rules imposed by governmental authorities. If said Goods are eligible for preferential tax or tariff treatment (such as free trade or international agreement), Seller shall provide Buyer with the documentation required to participate in said treatment.

MISCELLANEOUS: A. Seller shall be responsible and liable for any and all payroll taxes and employee benefits due its employees, and shall HOLD HARMLESS AND INDEMNIFY Buyer Group for any such taxes and benefits that it may be required to pay in connection with the Order. The construction, interpretation and performance of the Order, the Goods, the Conditions, and any and all transactions related to the same shall be governed by and construed solely in accordance with the laws of the State of Texas, without reference or regard to its choice of law rules, statutes, or laws which would direct or refer to the laws of another jurisdiction. Time is of the essence in Seller’s performance of the Order and under these Conditions. All headings are for convenience and do not constitute a part of these Conditions. Buyer and Seller expressly agree that the “U.N. Convention on Contracts for the International Sale of Goods” and the “Constitution on the Limitation Period in the International Sale of Goods” do not form a part the Order, nor these Conditions, and the same are hereby expressly renounced for all purposes.

B. Should any provision of this Order or these Conditions, or a portion thereof, be held invalid or illegal, such holding shall not affect the validity of the remaining provisions. Buyer’s terms control, and any failure to object to Seller’s contrary provisions contained elsewhere or to enforce any or all of these provisions in a particular instance shall not act as acquiescence to Seller’s terms or a waiver of these Conditions. Acceptance of the Goods or Seller’s offer to provide the Goods is expressly limited to these Conditions, and any additional or different terms of Seller are hereby rejected. No conditions, other than those stated herein, and no agreement or understanding, oral or written, in any way purporting to modify or negate these Conditions, whether contained in Seller’s bid documents, order acknowledgement, invoice or in any other of Seller’s forms or elsewhere, shall be binding on Buyer, unless agreed to in writing and executed by an officer of Buyer. No agent, employee, or representative of Buyer is authorized to alter any of these Conditions nor to agree to any conditions or other provisions whatsoever outside those stated herein.

C. Buyer and Seller hereby agree that the exclusive forum for the adjudication of any controversy or dispute relating to the construction, interpretation of or performance under or any matter relating to these conditions, this Order and any transactions related thereto, and/or the Goods under this Order furnished by Seller shall be the state or federal counts located in Harris County, State of Texas, and both parties hereby consent to the personal jurisdiction of such courts for all such purposes. These Conditions constitute the final, complete and exclusive agreement between Seller and Buyer.

D. Should suit be commenced to enforce any of the terms of this Order and these Conditions, the prevailing party shall be entitled to all costs, expenses, and reasonable attorneys’ fees. In addition to any other legal or equitable remedies, Buyer shall have the right to demand adequate assurances respecting Seller’s timely and conforming performance of the Order and these Conditions and inspect Seller’s books and records to ensure compliance therewith. Failure to enforce any or all of this Order and the Conditions in a particular instance shall not act as a waiver or preclude subsequent enforcement.