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EXHIBIT 10.24
ALLIANCE AGREEMENT
PRODUCTION OPERATIONS AND MAINTENANCE SERVICES
THIS AGREEMENT is made and entered into this the 4th day of June, 1998,
by and between PRODUCTION MANAGEMENT CORPORATION, a Louisiana corporation,
hereinafter referred to as "CONTRACTOR" and ENERGY PARTNERS, LTD., a Delaware
corporation, hereinafter referred to as "OPERATOR" concerning its subject
matter.
WHEREAS, OPERATOR and CONTRACTOR desire to establish an Alliance
Relationship under which CONTRACTOR shall supply certain services and materials
and share its expertise with OPERATOR. The agreed scope and purpose of the
alliance is to:
o Establish a mutually-beneficial long-term relationship between the
parties;
o Develop a thorough understanding and awareness of each parties'
needs, concerns and objectives;
o Maximize the efficiencies of each parties' activities associated
with OPERATOR'S producing properties.
o Seek additional producing properties to increase the revenues and
profits for both parties to this Alliance Agreement.
In furtherance of the Alliance efforts, OPERATOR agrees that is shall
endeavor to provide CONTRACTOR the opportunity to propose its services for each
producing property that OPERATOR now has, or may acquire in the future, and
CONTRACTOR agrees that it shall endeavor to provide its best pricing to OPERATOR
for services which may be rendered hereunder.
For and in consideration of the mutual promises and agreements herein
set forth and in accordance with the following terms and conditions, OPERATOR
and CONTRACTOR agree as follows:
1.0 CONTRACT DOCUMENTS AND WORK DESCRIPTION
1.1 This Agreement and the documents identified below, said
documents being attached hereto and made a part hereof or
incorporated herein by reference for all purposes, including
any and all modifications incorporated herein prior to
execution of this Agreement, shall be collectively known as
the "Contract Documents".
The above-referenced documents include:
Exhibit "A", Property Schedule, updated as needed
Contractor's Accepted Proposal(s), to be incorporated and
attached and numbered as Exhibits "B-1", "B-2", etc.
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Operator's Award of Contract Letter(s), to be incorporated and
attached and numbered as Exhibits "C-1", "C-2", etc.
Exhibit "D", Insurance Requirements
Exhibit "E", Executive Order No. 11246 -- non-discrimination;
certificate of non-segregated facilities; and related
federal contracting issues.
1.2 The Contract Documents shall constitute the entire agreement
between the parties hereto with respect to the matters covered
hereby.
1.3 The work is defined as production operations and maintenance
services for OPERATOR'S properties scheduled on Exhibit A,
attached. The CONTRACTOR shall furnish all labor, supervision,
associated transportation and subsistence necessary to provide
these services as per CONTRACTOR'S proposal. All work shall be
performed in accordance with the Contract Documents, and
CONTRACTOR'S quality of services shall be such that the
operations will be those of a prudent operator.
1.4 The CONTRACTOR warrants that he is familiar with the terms of
the Contract Documents and is, therefore, apprised of the
scope and description of the work in such derail that he may
estimate his costs in connection with the performance thereof.
2.0 CONTRACTOR'S DUTIES AND OBLIGATIONS
2.1 The CONTRACTOR shall perform the work as defined above.
2.2 It is agreed that time is of the essence and the CONTRACTOR
shall commence the performance of his duties within ten (10)
days after receiving notification from the OPERATOR to
commence with the work and shall proceed diligently
thereafter. CONTRACTOR shall perform the work in a safe, good
and workmanlike manner in accordance with industry standards
and all applicable laws and regulations.
2.3 The CONTRACTOR further warrants that:
2.3.1 He has fully acquainted himself with and knows of
no reason why any physical or material factors would
interrupt his diligent performance.
2.3.2 He is fully acquainted with the nature of the duties
he hereby undertakes to perform in this Agreement and
knows of no reason and anticipates no interruptions,
whether by labor disputes or otherwise, which would
prevent his diligently pursuing the work.
2.3.3 In the performance hereunder, CONTRACTOR is an
independent contractor, the OPERATOR being interested
only in the results obtained.
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The CONTRACTOR acknowledges that neither he nor any
of his employees are employees of the OPERATOR.
2.3.4 The actual performance and supervision of all work
hereunder shall be by CONTRACTOR, but OPERATOR or its
representatives shall have access to the operations
to determine whether performance by CONTRACTOR is in
accordance with all provisions of the Contract
Documents.
2.3.5 CONTRACTOR shall pay and discharge all taxes,
leinable claims, charges or other impositions imposed
on CONTRACTOR and shall keep all properties free and
clear of all liens and encumbrances arising from the
activities of CONTRACTOR OPERATOR, at its option,
may require lien waivers prior to full payment to
CONTRACTOR, and may set off amounts payable to
satisfy any liens or encumbrances arising from
CONTRACTOR'S work.
3.0 INDEMNITY
The CONTRACTOR and OPERATOR further agree that:
3.1 For the purposes of the indemnity provisions set forth in this
section, the term "CONTRACTOR GROUP" as used herein as a
reference shall mean, individually and collectively,
CONTRACTOR and the employees, agents, representatives,
contractors and subcontractors of CONTRACTOR and the subrogees
of said parties. Similarly, the term "OPERATOR GROUP" as used
herein as a reference, shall mean, individually and
collectively, OPERATOR and the employees, agents,
representatives, contractors, and subcontractors of OPERATOR
and the subrogees of said parties. It is also specifically
understood and agreed that a contractor, supplier, or
subcontractor furnishing any of the services and/or materials
which are prescribed in this Agreement shall be deemed a
member of the Group (CONTRACTOR GROUP or OPERATOR GROUP) of
the party hereto who has or is charged with the responsibility
for furnishing such services and/or materials under and in
accordance with this Agreement. Solely for the purposes of the
indemnity provisions set forth in this section, the negligent
or willful acts or omissions of CONTRACTOR GROUP shall be
imputed to CONTRACTOR, and the negligent or willful acts or
omissions of OPERATOR GROUP shall be imputed to OPERATOR.
3.2 CONTRACTOR agrees to protect, defend, indemnify and hold
OPERATOR, its co-owners, contracting landowners, and joint
owners/joint venture partners of oil, gas and/or other mineral
leases, harmless from and against all claims, demands,
damages, costs, expenses and causes of action of any and every
type and character (collectively, "Claims"), without limit and
without regard to the cause or causes thereof which are
related in any way to performance by CONTRACTOR GROUP under
this Agreement and which arise in favor of or are made by
CONTRACTOR GROUP due to personal injury, death, or property
damage, whether or not caused
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by the joint and/or concurrent negligance of OPERATOR GROUP or
CONTRACTOR GROUP, except however, to the extent any Claims
result from the gross negligence or willful acts or omissions
of OPERATOR GROUP.
OPERATOR agrees to protect, defend, indemnfy and hold
CONTRACTOR safe and harmless from and against all Claims
without limit and without regard to the cause or causes
thereof which are related in any way to performance by
OPERATOR GROUP under this Agreement and which arise in favor
of or are made by OPERATOR GROUP due to personal injury,
death, or property damage whether or not caused by the joint
and/or concurrent negligence of OPERATOR GROUP or CONTRACTOR
GROUP, except however, to the extent any Claims result from
the gross negligence or willful acts or omissions of
CONTRACTOR GROUP.
Notwithstanding the foregoing, CONTRACTOR'S obligation under
this Paragraph 3.2 shall be limited to the amount of insurance
coverage required under this Agreement pursuant to Exhibit
"B", Insurance Requirements. Conversely, OPERATOR'S obligation
under this Paragraph 3.2 shall be limited to ten million
dollars ($10,000,000) per claim.
3.3 CONTRACTOR agrees to protect, indemnify, and hold OPERATOR,
its co-owners, contracting landowners, and joint
operators/joint venture partners of oil, gas and/or other
mineral leases; safe and harmless from and against all Claims
of every kind and character on account of personal injury to,
illness or death of, or loss of or damage to property of,
third parties other than OPERATOR GROUP or CONTRACTOR GROUP
where the personal injury, illness, death, or loss of or
damage to property is related to performance by CONTRACTOR
under this Agreement. CONTRACTOR'S obligation to defend and
indemnify OPERATOR hereunder shall be limited to the same
degree that the underlying cause of action results from the
willful or negligent acts or omissions of CONTRACTOR.
CONTRACTOR'S responsibility to OPERATOR for all such damages
shall in all events be limited to the amount of insurance
coverage required of CONTRACTOR in Exhibit "B" -- Insurance
Requirements.
3.4 OPERATOR and CONTRACTOR agree to defend each other,
respectively, against all suits brought upon any claim,
demand, or cause of action covered by their indemnity
obligations, but each party shall have the right, at its
option, to participate at its own expense with attorneys of
its own selection in the defense of any such suits without
releasing the other party of any indemnity obligation
hereunder.
3.5 CONTRACTOR GROUP shall not be liable to OPERATOR,
co-operators, contracting landowners and joint operators/joint
venture partners of oil, gas and/for other mineral leases for
delays, curtailment of operations, deferred production, loss
of product, process failures, loss of profits, well control
expenses, reservoir damages, blowout and cratering damages,
pollution damages caused by an
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uncontrolled flow of oil emanating from beneath the surface,
or any other such consequential damages, howsoever caused,
including that resulting from the sole and/or concurrent
negligent acts or omissions of CONTRACTOR GROUP.
3.6 Any action against CONTRACTOR by OPERATOR must be commenced
within one year after notice to OPERATOR of the claim.
3.7 CONTRACTOR shall assume all responsibility for, including
control and removal of, and shall protect, defend and hold
harmless OPERATOR from any and all Claims (as defined in
Paragraph 3.2 above) for personal injury, death or property
damage and including claims for response costs or actions or
orders issued by governmental entities, claims for
restitution, contribution or equitable indemnity and other
claims, orders or notices of violation from federal, state or
local agencies or courts, arising from pollution,
contamination or other environmental conditions emanating from
above the surface or non-compliance with law, order or
regulation, to the extent caused by CONTRACTOR'S negligent act
or omission, up to a maximum of $l million, and excluding wild
well control and well blow-out claims, for which OPERATOR
sha1l assume all responsibility, including control and removal
and claims for response costs, or actions or orders issued by
governmental entities, claims for restitution, contribution,
or equitable indemnity and other claims, orders, or notices of
violations from federal, state or local courts arising from
pollution (surface and subsurface), contamination or other
environmental conditions arising from a wild well or well
blow-out.
3.8 Both OPERATOR and CONTRACTOR acknowledge that certain State or
Federal laws may act to bar, limit, or otherwise modify the
indemnity provisions contained herein, and both OPERATOR and
CONTRACTOR agree that in the event such law(s) should be
determined to apply to this Agreement, then the indemnity
provisions shall be deemed to be amended so as to comply with
such applicable law. To the extent that the law of the State
in which the work is performed, or, in instances where work
is performed on the Federal Outer Continental Shelf, the laws
of the adjoining State, are deemed not to apply to this
Agreement, then the Federal Maritime Laws of the United States
shall apply.
3.9 It is acknowledged that from time to time during the
performance by CONTRACTOR, its personnel may have their advice
and assistance solicited by OPERATOR'S personnel in matters
and relative to tasks which fall outside the Scope of Work
covered by this Agreement. CONTRACTOR does not have adequate
knowledge of, and lacks adequate control over, such unplanned
and unanticipated advice and assistance; consequently,
OPERATOR WILL INDEMNIFY AND HOLD CONTRACTOR HARMLESS FROM ALL
DAMAGES, ACTIONS, PROCEDURES, CLAIMS AND DEMANDS BY REASON OF
ANY SUCH ADVICE AND ASSISTANCE.
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3.10 The terms and provisions of Subparagraphs 3.1 through 3.9 of
this section shall be applicable only between OPERATOR and
CONTRACTOR and do not create any affirmative rights in third
parties or governments.
4.0 "FORCE MAJEURE"
Neither party hereto shall be liable for damage to the other for any
acts, omissions or circumstances occasioned by or in connection with,
or as a consequence of, and the obligations of the parties shall be
suspended during continuance of, any "force majeure" conditions,
including but not limited to any acts of God, strikes, lockouts or
other industrial disturbances, acts of the public enemy, sabotage,
wars, blockades, insurrections, riots, epidemics, lightning,
landslides, earthquakes, floods, fires, arrests, restraints of rulers
and peoples, civil disturbances, or the binding order of any court or
governmental authority which has been resisted in good faith by all
reasonable legal means, or any other cause, whether of the kind herein
enumerated or otherwise, not within the control of the party claiming
suspension, and which, by the exercise of due diligence, such party is
unable to prevent or overcome. Such causes or contingencies affecting
the performance of this Agreement by the parties hereto, however, shall
not relieve either party of liability in the event of its concurring
negligence or in the event of its failure to use diligence to remedy
the situation and remove the cause in an adequate manner and with all
reasonable dispatch, nor shall such causes or contingencies affecting
the performance of this Agreement relieve any party of liability unless
such party shall give notice and full particulars of the same in
writing or by telegram to the other party as soon as possible after the
occurrence relied upon, and like notice shall be given upon termination
of such "force majeure" conditions.
5.0 COMPENSATION TO CONTRACTOR
5.1 Base Compensation. The CONTRACTOR shall receive, as monthly
compensation for the performance of his duties hereunder, the
monthly sum on the basis of the Contractor's Accepted
Proposal. All such invoices shall be sent directly to the
OPERATOR at the end of each month services are provided unless
the CONTRACTOR receives written notice from the OPERATOR with
different instructions.
5.2 Incentive Compensation. It is the intent of the OPERATOR that
the CONTRACTOR shall be eligible to earn incentive payments
over and above the Base Compensation provided for in
Subparagraph 5.1, above.
The extent of incentive available, if any, and the manner of
computation and method of payment shall be determined
individually for each property operated under this Alliance
Agreement.
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5.3 The OPERATOR shall pay CONTRACTOR'S invoice within thirty (30)
days after the date of such invoice. In the event of a
disputed invoice, OPERATOR agrees to pay the undisputed
portions(s) of such invoice within thirty (30) days of
receipt. All invoice amounts not paid by OPERATOR within
thirty (30) days of the invoice date shall accrue interest at
the rate of one and one-half percent (1 1/2%) per month until
paid. Interest shall also accrue to disputed invoice amounts
should the amounts be determined, either by agreement or
arbitration, to be valid.
5.4 CONTRACTOR acknowledges that payment of any funds or
inspection of work by OPERATOR shall not constitute a waiver
of acceptance of the work.
6.0 TERM
This Alliance Agreement shall remain in full force and effect for a
period of three (3) years from the date first written, provided,
however, that this Agreement shall automatically renew for additional
one (1) year periods unless either party hereto provides sixty (60)
days prior written notice of its intent not to renew the Agreement. In
the event that either party is in default of this Agreement during the
sixty- (60) day notice period, then the automatic renewal provision
herein shall be of no force and effect and this Agreement shall not
renew.
7.0 TERMINATION OF WORK
7.1 Nothing in the Contract Documents shall be construed so as to
limit in any way the obligations that as stated, continue
after completion and acceptance of Work or other termination
of this Agreement, including the obligations of indemnity,
insurance and warranty.
7.2 Pursuant to Subparagraph 7.4, OPERATOR may terminate
CONTRACTOR'S right to proceed with the Work, or any part
thereof regardless of its stage of completion, or this
Agreement, upon the occurrence of any of the following events
enumerated in this Subparagraph 7.2 but only after CONTRACTOR
has failed to cure any alleged default or condition after
thirty (30) days' written notice from OPERATOR specifying the
nature of such default:
a. CONTRACTOR'S failure to prosecute the Work or any
portion thereof in a diligent, efficient,
workmanlike, skillful and careful manner, or to
reasonable satisfaction of OPERATOR, including
CONTRACTOR'S refusal or neglect to supply a
sufficiency of properly skilled workmen or materials
of the proper quality or quantity.
b. CONTRACTOR'S failure to comply with any of the
material terms of the Contract Documents;
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c. The insolvency of CONTRACTOR; any assignment by
CONTRACTOR for the benefit of creditors; any
admission by CONTRACTOR in writing of its inability
to pay its debts generally as the same become due; or
d. The levy or attachment upon CONTRACTOR'S equipment
which is not removed or contested within thirty (30)
days.
7.3 Should conditions arise that in the opinion of OPERATOR make
it advisable or necessary to cease Work, OPERATOR may
terminate the applicable Work Order and Scope of Work for its
convenience (but not this Agreement) upon written notice to
CONTRACTOR and CONTRACTOR shall perform an orderly and
expedient close of the Work, which is in progress at that
time. Such termination shall include the right to direct
CONTRACTOR to complete any distinct phase of the Work, and to
terminate all other Work associated with such Work Order. Any
Work which may be recommenced as a new project after the
termination of a Contractor Work Order pursuant to this
Subparagraph 7.3 shall be subject to the provisions
of Paragraph 8.0 below.
7.4 Upon termination of the parties' obligations under this
Paragraph 7.0, CONTRACTOR shall (i) take all steps necessary
or advisable to close out the Work in progress in a safe and
prudent manner, (ii) cease ordering materials or supplies to
the extent permissible; and (iii) make every reasonably
possible effort to procure cancellation of all existing orders
upon terms satisfactory to OPERATOR. Upon such termination,
it is agreed that the obligations of this Agreement shall
continue as to Work already performed. It is further agreed
that in the event of such termination, CONTRACTOR shall be
entitled to be paid for its performance to the date of such
termination. OPERATOR shall cooperate fully in such closeout.
OPERATOR shall pay CONTRACTOR a prorated portion of a monthly
Fixed Fee paid pursuant to Paragraph 5.0, prorated based upon
the number of days worked in each month, plus all sums due and
owing for Work completed, including that Work done during
closeout. In addition, should the termination of Work occur
under Subparagraphs 7.3, 7.5 or 7.6, OPERATOR shall pay to
CONTRACTOR a penalty amount equal to the Fixed Fee for one
month under the applicable Work Order and Scope of Work.
7.5 Each of the following shall constitute an "Operator Event of
Default," under which CONTRACTOR may terminate Work under a
Work Order or this Agreement.
a. OPERATOR'S failure to pay an aggregate of $50,000 or
more of undisputed invoices submitted by CONTRACTOR
within thirty (30) days of receipt by OPERATOR;
b. OPERATOR'S failure to comply with any other material
term of the Contract Documents following thirty (30)
days' prior written notice from CONTRACTOR to
OPERATOR specifying such non-compliance;
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c. The filing of a lien or liens aggregating $100,000 or
more against any OPERATOR property by any party other
than CONTRACTOR or its subcontractors which is not
cancelled, released or bonded within thirty (30) days
of date of written notice to OPERATOR of filing; or
d. The filing of a voluntary bankruptcy petition by or
an involuntary bankruptcy petition against OPERATOR,
any assignment by OPERATOR for the benefit of its
creditors or any admission by OPERATOR in writing of
its inability to pay its debts generally as they
become due.
8.0 RIGHT OF FIRST REFUSAL
8.1 Each party hereto recognizes that the other is bringing an
expertise to the Alliance which the other party does not have.
Each party hereto grants the other party a right of first
refusal to act as an alliance partner in any project which,
during the term of this Agreement, (i) would require their
particular areas of expertise, which for CONTRACTOR only are
specifically described above in Paragraph 1.3 of this Alliance
Agreement; and (ii) take place in offshore or onshore
Louisiana, Texas, Alabama or Mississippi.
8.2 A party with a potential project subject to this mutual right
of first refusal shall give the other party fifteen (15) days'
written notice as to the nature and particulars of the
project, with such details so as to permit the other party to
make an informed decision whether or not to participate as an
alliance partner in said project. Such party shall be
permitted to inspect any facilities or platforms potentially
involved, if permission may be secured by the owner of the
facilities or platforms. Such notice shall also state whether
a time frame shorter than fifteen (15) days will be required
for a response, in which case the right of first refusal must
be exercised prior to three full twenty-four (24) hour days
before the time for response is due to the owner.
8.3 Any material modification to a project which is later received
by the offering party from the potential project owner after
the other party to this Agreement has rejected the original
project scope shall constitute a new proposal and shall
require a new notice under this Paragraph 8.0. Once a
potential project is so offered under this Paragraph 8.0 and
is rejected by the other party, the originating party may
utilize any company it deems prudent to perform the particular
project.
8.4 If a potential project is offered by a party hereto and such
project is accepted by the receiving party, then the project
shall so be awarded. The parties shall thereafter enter into a
Work Order, a Contractor's Accepted Proposal and
Qualifications and an Award of Contract Letter, so as to
define the scope of the project and the agreed Contract Price
(as defined in the General Conditions).
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9.0 COMPETITIVE RATES
In exchange for the right of first refusal given by OPERATOR
in Paragraph 8.0 above, CONTRACTOR shall offer its most
competitive rates to OPERATOR on a "most-favored nations"
basis for the Work to be provided under this Agreement.
CONTRACTOR warrants its "best" prices are based upon the
following factors: the Works' schedule, the number and skill
level of the personnel required to perform the Work, the
anticipated type and quantity of hydrocarbon production
involved, the Work's location, the anticipated costs of goods
and services to be obtained from third parties in connection
with the Work, cost sharing opportunities with other projects
of CONTRACTOR, the amount of due diligence CONTRACTOR has been
permitted to perform for the Work prior to establishing a
price, regulatory issues involved in the Work, the identity of
the platform owners, whether OPERATOR anticipates using the
platforms and facilities involved for additional exploration
activities, the age and condition of the platforms and
facilities involved, and other inherent dangers and
difficulties associated with the Work.
10.0 SUBCONTRACTORS
As soon as is practicable, and before awarding any
subcontracts, the CONTRACTOR shall notify the OPERATOR in
writing of the names of the subcontractors proposed and shall
not employ any to whom the OPERATOR may have an objection. The
CONTRACTOR agrees that he is as fully responsible to the
OPERATOR for the acts, omissions and delivery dates of his
subcontractors, and of persons either directly or indirectly
employed by him, as he is of persons directly employed by him.
The CONTRACTOR shall be responsible for the coordination of
the trades, subcontractors, materials and men engaged in his
work hereunder.
11.0 EXCLUSION
Notwithstanding any other provision of the Contract Documents
and regardless of whether recovery is sought under contract,
warranty, tort, negligence, a deceptive trade practices act,
strict liability or other legal theory, neither party shall be
liable to the other party for and any indemnity hereunder
shall not include any special, punitive, incidental, indirect,
or consequential damages of any nature, including, but not
limited to, loss of use, downtime, reservoir loss, loss of
product, loss of operating supplies or loss of revenues,
profits, or income.
12.0 CONFIDENTIALITY
12.1 It is understood by CONTRACTOR that in the
performance of the Work contemplated hereunder,
CONTRACTOR may have access to information considered
sensitive, proprietary, and/or confidential by
OPERATOR. As additional consideration for the
Alliance Agreement, CONTRACTOR agrees that unless
prior written approval by an officer of OPERATOR is
granted, it will not disclose to any person, other
than to an officer of OPERATOR, any information
disclosed to or acquired by CONTRACTOR in connection
with the Contract Documents. CONTRACTOR further
agrees that it will not use such information
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for purposes other than those contemplated by the
Contract Documents. Should any such sensitive,
proprietary or confidential information be legally
required to be disclosed, CONTRACTOR shall
immediately notify OPERATOR of such requirement, the
information potentially to be disclosed and provide a
legal opinion stating the requirement of such
disclosure. OPERATOR shall be given time to defend
the disclosure of such information to the extent
practicable.
12.2 It is understood by OPERATOR that in the performance
of the Work contemplated hereunder, OPERATOR may have
access to information considered sensitive,
proprietary, and/or confidential by CONTRACTOR. As
additional consideration for the Alliance Agreement,
OPERATOR agrees that, unless prior written approval
by an officer of CONTRACTOR is granted, it will not
disclose to any person, other than to an officer of
OPERATOR, any information disclosed to or acquired by
OPERATOR in connection with the Contract Documents.
OPERATOR further agrees that it will not use such
information for purposes other than those
contemplated by the Contract Documents. Should any
such sensitive, proprietary or confidential
information be legally required to be disclosed,
OPERATOR shall immediately notify CONTRACTOR of such
requirement, the information potentially to be
disclosed and provide a legal opinion stating the
requirement of such disclosure. CONTRACTOR shall be
given time to defend the disclosure of such
information to the extent practicable.
13.0 MAINTENANCE OF RECORDS AND RIGHT OF AUDIT
CONTRACTOR shall maintain true and correct records pertaining
to the Work performed hereunder, including on a daily basis
the names of the employees, starting and ending times for
each, travel time, the type of Work performed by each crew of
employees, the materials used and other records which are
subject to inspection hereunder for a period of two (2) years
after the invoice date for the portion of the Work involved.
OPERATOR may audit any books and records of CONTRACTOR
relating directly or indirectly to work and services performed
hereunder and the prices or rates charged therefor. The
results of OPERATOR'S audits shell be kept confidential and
may not be disclosed except as necessary to enforce OPERATOR'S
rights under the Contract Documents or to comply with
OPERATOR'S audit obligations to others. OPERATOR shall have no
right to audit records of CONTRACTOR pertaining to
CONTRACTOR'S other customers. CONTRACTOR agrees to modify this
Paragraph 13.0 as necessary to satisfy any and all audit
requirements placed upon OPERATOR (of which CONTRACTOR shall
be provided a copy).
14.0 STATUTORY EMPLOYER
In the event the laws of the State of Louisiana govern this
Alliance Agreement, the parties agree as follows:
The work performed by CONTRACTOR pursuant to this Alliance
Agreement is part of OPERATOR'S trade, business or occupation.
As such, CONTRACTOR'S work constitutes an integral part of
OPERATOR'S business necessary to generate
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OPERATOR'S goods, products and services. The parties recognize
OPERATOR as the statutory employer of CONTRACTOR'S employees;
and
OPERATOR'S legal status as a statutory employer in no way
effects the CONTRACTOR'S status as an independent contractor,
nor does it give OPERATOR the right to direct or control the
operations of the CONTRACTOR or its employees and agents,
except as to the results to be obtained under this Alliance
Agreement.
15.0 LIMITATION OF LIABILITY
Nothing contained in the Contract Documents shall be construed
or held to deprive the parties hereto of any right to claim
limitation of liability against any third party plaintiff or
libelant, but not as against OPERATOR in any claims, suits or
libels brought by OPERATOR against CONTRACTOR or against
OPERATOR for which CONTRACTOR has agreed to indemnify
OPERATOR herein, nor as against CONTRACTOR in any claims,
suits or libels brought by CONTRACTOR against OPERATOR or
against CONTRACTOR for which OPERATOR has agreed to indemnify
CONTRACTOR herein.
16.0 PRECEDENCE
The Contractor's Accepted Proposal and Qualifications take
precedence over all other Contract Documents, except the Award
of Contract Letter. The Award of Contract Letter takes
precedence over all Contract Documents,
17.0 NOTICES
All notices, statements, communications and monies, payable
hereunder shall be forwarded to the parties hereto at the
addresses specified below. Any party may, at any time, change
its address by giving written notice of the change to the
other party.
OPERATOR: ENERGY PARTNERS, LTD.
1100 POYDRAS STREET, SUITE 1850
NEW ORLEANS, LA 70170
CONTRACTOR: PRODUCTION MANAGEMENT CORPORATION
2439 MANHATTAN BOULEVARD, SUITE 500
HARVEY, LA 70058
This agreement may be executed in counterparts, with all counterparts
taken together having the same effect as if both parties had signed the same
instrument.
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EXECUTED as of the day and year first above written.
<TABLE>
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Witnesseth:
ENERGY PARTNERS, LTD.
<S> <C>
By:
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Witness
Title:
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Witness
PRODUCTION MANAGEMENT
CORPORATION
By:
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Witness
Title:
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Witness
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