Terms and Conditions

ACTION ELEVATOR

STANDARD TERMS AND CONDITIONS

These Standard Terms and Conditions are incorporated by reference into and made an integral part of all Agreements between Action Elevator Company (“we” or “ACTION”) and Customer (“you”) and, together with any Statement of Work and/or any Business Terms, constitute the complete Agreement between you and Action Elevator Company.

1. AGREEMENT STRUCTURE

1.1. Entire Agreement. Our Agreement with you consists of these parts as applicable:

• Statement of Work
• Business Terms
• Standard Terms and Conditions (this document)
• Duly executed Change Orders

1.2. Order of Precedence

In any conflict or inconsistency between these documents, the following order of precedence shall apply:

• Duly executed Change Orders
• Statement of Work
• Business Terms
• Standard Terms and Conditions

1.3. Integration. This Agreement constitutes the entire understanding between the parties with respect to the subject matter and supersedes all prior representations, negotiations, or agreements, whether written or oral.

2. CHANGES AND MODIFICATIONS

2.1. Change Orders. Any changes to the scope of work, materials, or timeline must be documented in a written change order signed by both parties. Change orders may affect pricing and completion dates.

2.2. Discovery of Unforeseen Conditions. If we discover conditions that were not reasonably foreseeable at the time of contract execution that materially affect the scope, cost, or timeline of the work, we will promptly notify you. The parties will negotiate in good faith to address such conditions through a change order.

2.3. Change Request Process. Either party can initiate a change request by notifying the other party in writing. We will provide a written assessment of the proposed change, including any cost implications, within fifteen (15) business days.

2.4. Equipment Changes. Any modifications, upgrades, or alterations to the equipment covered under this Agreement must be:

• Documented in writing
• Approved by both parties
• Compliant with all applicable codes and regulations

2.5. Service Scope Changes. Any changes to the scope of services under this Agreement must be documented in a written amendment signed by both parties. Such changes may result in price adjustments.

2.6. Tariffs. If new or increased tariffs affect the cost of materials or components for elevator maintenance, modernization or repair, we reserve the right to adjust the project cost accordingly. You are obligated to pay for any additional costs resulting from these tariff changes. We will provide written notification and documentation of the tariff changes and the corresponding cost adjustments. We will make reasonable efforts to mitigate tariff impacts by seeking alternative suppliers and optimizing procurement strategies.

3. CHANGE OF OWNERSHIP OR MANAGEMENT. You must notify us at least 30 days before any change in ownership, management, or tenancy of the premises that might relieve you of responsibility for equipment maintenance. You must provide us with the name and address of the person who will be responsible for purchasing Elevator maintenance after the change. You will remain liable for payments under the agreement for 60 days from the change or until the new agreement becomes effective, whichever happens first.
4. LIABILITY LIMITATIONS

4.1. General Liability. We will not be liable for any loss, damage, or delay except those directly due to our negligence or the negligence of our employees. This Agreement does not affect your responsibility for accidents to people or property while using or being near the equipment. Without limiting the foregoing, we will not be liable for any loss, damage, or delay caused in any material part by your negligence.

4.2. Exclusion of Consequential Damages. In no event shall either party be liable for any indirect, incidental, special, or consequential damages, including but not limited to loss of profits, revenue, data, or use, even if advised of the possibility of such damages.

4.3. Limitation of Liability. Our total liability for any and all claims arising out of or related to this Agreement shall not exceed the total amount paid by you under this Agreement.

4.4. Force Majeure. Neither party shall be liable for any failure or delay in performance due to circumstances beyond reasonable control, including but not limited to:

• Natural disasters, floods or extreme weather events
• Fire, explosion, or other casualty
• War, terrorism, riots, civil disturbances, or public unrest
• Government actions, orders, or restrictions
• Strikes, labor disputes, or other industrial disturbances
• Epidemics, pandemics, or other public health emergencies
• Cyber-attacks or significant IT system failures
• Supply chain disruptions affecting parts or materials
• Severe labor shortages in the industry
• Power outages or utility service disruptions
• The affected party must try to minimize the effects and resume performance as soon as reasonably possible. If a force majeure event continues for more than sixty (60) consecutive days, either party may terminate this Agreement by written notice.

5. INSURANCE REQUIREMENTS

5.1. Our Insurance Obligations. We will maintain throughout the term of this Agreement:

• Commercial General Liability Insurance of at least $1,000,000 per occurrence
• Workers’ Compensation Insurance as required by law
• Employer’s Liability Insurance of at least $1,000,000
• Commercial Automobile Liability Insurance of at least $1,000,000

We will provide certificates of insurance upon request.

5.2. Your Insurance Obligations. You must maintain throughout the term of this Agreement Commercial General Liability Insurance of at least $1,000,000 per occurrence Property Insurance covering the full replacement value of the equipment. You will provide certificates of insurance upon request.

5.3. Notice of Cancellation. Each party must give the other thirty (30) days’ written notice before canceling, not renewing, or materially changing any required insurance coverage. A change of insurance carrier alone in the ordinary course of business is not a material change.

6. DISPUTE RESOLUTION

6.1. Negotiation. If any dispute arises related to this Agreement, we will first try to resolve it through good faith negotiations between representatives who have authority to settle the dispute.

6.2. Escalation. If the parties cannot resolve the dispute through negotiations within thirty (30) days, either party can escalate the matter to senior executives of both parties, who must meet within fifteen (15) days of escalation.

6.3. Mediation. If the dispute remains unresolved forty-five (45) days after escalation to senior executives, both parties agree to submit the dispute to non-binding mediation in Maryland under the American Arbitration Association rules for mediation before pursuing litigation.

6.4. Litigation. If mediation doesn’t resolve the dispute within sixty (60) days of starting mediation, or a longer period both parties agree to, either party can proceed with litigation according to Section 6.5.

6.5. Jurisdiction and Venue. Both parties waive the right to a jury trial and agree that any lawsuit under this Agreement must be filed in Anne Arundel County, Maryland.

6.6. Legal Fees. If either party hires a third party to enforce, interpret, or defend any terms of this Agreement or to collect any money due, with or without litigation, the prevailing party can recover all costs including reasonable attorney’s fees.

7. TERMINATION

7.1. Termination for Customer’s Material Breach. If this Agreement is terminated for your material breach or for any reason other than our default, you agree to immediately pay as liquidated damages fifty percent (50%) of the remaining amount due under this Agreement. The parties agree this is a reasonable measure of damages based on our experience in the industry and the losses that may result from premature termination or material breach.

7.2. Material Breach Defined. The following events constitute a material breach of your obligations:

• Failure to pay any amount due within sixty (60) days
• Failure to provide safe and necessary access to work areas
• Failure to provide a safe workplace or follow our safety requirements
• Failure to remove hazardous materials
• Interference with our performance of the work
• Not telling us about a dangerous condition or malfunction, or not taking a malfunctioning unit out of service
• Not following lock-out/tag-out procedures
• Not upgrading, improving, or modernizing Units we reasonably determine are unsafe without such changes
• Not correcting Elevator Code violations

7.3. Effect of Termination. Upon termination:

• We will stop all work
• You will pay us for all work completed before termination
• You will pay any applicable liquidated damages if termination is due to your breach
• We will return the job site to a safe condition

7.4. Right to Cure.

• General Right to Cure. Except as otherwise provided in this Agreement, if either party fails to perform any obligation under this Agreement (other than payment obligations), the non-defaulting party may provide written notice of such default. The defaulting party will have sixty (60) days from receipt of such notice to cure the default. If the defaulting party cures the default within this cure period, no termination or other remedies will be pursued by the non-defaulting party with respect to such cured default. If cure is not practicable within sixty (60) days, the defaulting party will have sixty (60) days to initiate a cure. If the defaulting party ceases diligent efforts to cure the default, the non-defaulting party may terminate this Agreement by written notice to the defaulting party, provided more than sixty (60) days have elapsed since the date of notice of default.
• Payment Defaults. If you fail to make any payment when due under this Agreement, you have thirty (30) days from the original due date to cure such payment default, regardless of whether we have provided notice of such default. We reserve the right to assess late fees as specified elsewhere in this Agreement for payments made during this cure period.
• Incurable Defaults. Notwithstanding the foregoing, if a default is by its nature incapable of being cured within the applicable cure period, but the defaulting party has commenced good faith efforts to cure such default within the cure period and diligently pursues such cure, the cure period shall be extended for a reasonable time not to exceed an additional thirty (30) days, provided that the defaulting party provides the non-defaulting party with regular updates on its progress.

8. INTELLECTUAL PROPERTY

8.1. Ownership of Documents and Designs. All plans, specifications, drawings, designs, and other documents we prepare for this project remain our property and intellectual property. You receive a non-exclusive license to use these documents solely for this project.

8.2. Software and Firmware. Any software or firmware we provide is licensed, not sold. You have a non-exclusive, non-transferable license to use such software or firmware solely with the equipment.

8.3. Ownership of Data and Diagnostics. We own all diagnostic data generated from the equipment, subject to your rights to access and use such data as provided in this Agreement.

8.4. Intellectual Property Indemnification. We will defend, indemnify, and hold you harmless against claims that our services or materials infringe on third-party intellectual property rights. You must promptly notify us of such claims and cooperate in the defense.

9. DATA PRIVACY AND SECURITY.

9.1. Data Collection and Use. We may collect diagnostic data from the equipment to provide services under this Agreement. This data might include equipment performance metrics, usage patterns, and error logs. We will use this data only to:

• Diagnose equipment issues
• Improve maintenance services
• Plan preventative maintenance
• Identify potential equipment failures

9.2. Data Security. We will implement reasonable security measures to protect any data collected from the equipment, including:

• Encrypting data in transit and at rest
• Limiting data access to authorized personnel
• Regularly assessing security of data storage systems

9.3. Data Breach Notification. If a data breach affects your data, we will notify you within 72 hours of discovery and cooperate with you in investigating and fixing the breach.

9.4. Remote Access Security. If the equipment allows remote access for diagnostics or service, we will implement appropriate security controls including:

• Secure authentication methods
• Session timeouts
• Access logs
• Regular security updates
• CONFIDENTIALITY

9.5. Confidential Information. Both parties agree to keep confidential any proprietary or non-public information received from the other party during the performance of this Agreement.

9.6. Exceptions. This confidentiality obligation does not apply to information that:

• Is or becomes publicly available through no fault of the receiving party
• Was known to the receiving party before disclosure
• Is independently developed by the receiving party
• Is required to be disclosed by law or court order

10. ASSIGNMENT AND SUBCONTRACTING

10.1. Assignment. Neither party may assign this Agreement without the other party’s prior written consent, which won’t be unreasonably withheld. Any attempted assignment without consent is void. However, either party can assign this Agreement without consent to a successor in a merger, acquisition, or sale of all or substantially all of its assets.

10.2. Subcontracting. We may subcontract portions of the work, provided that:

• We remain fully responsible for all work performed by subcontractors
• All subcontractors meet our qualification standards
• We notify you in writing before any subcontractors perform substantial work
• All subcontractors comply with the terms of this Agreement
• You can reasonably object to any subcontractor based on documented performance issues or safety concerns

11. HAZARDOUS MATERIALS

11.1. Pre-Existing Hazardous Materials. You represent that, to your knowledge, no asbestos or other hazardous materials are present in the work area. If hazardous materials are discovered, we will stop work and notify you immediately.

11.2. Testing and Abatement. Testing for and abatement of hazardous materials is not included in our scope of work unless specifically stated in the Statement of Work. You are responsible for any necessary testing and abatement.

11.3. Indemnification for Hazardous Materials. You agree to indemnify, defend, and hold us harmless from any claims, damages, losses, or expenses arising from the presence, disturbance, or discharge of pre-existing hazardous materials at the work site.

11.4. Environmental Compliance. Both parties must comply with all applicable environmental laws, regulations, and codes relating to the equipment and services under this Agreement, including regulations governing:

• Hazardous materials management
• Waste disposal
• Energy efficiency standards

We will properly handle, store, and dispose of any hazardous materials used in providing services under this Agreement according to applicable laws and regulations. You must inform us of any known hazardous materials near the equipment that could affect service operations.

12. CUSTOMER RESPONSIBILITIES

12.1. You are responsible for providing all proprietary service tools and equipment needed for diagnostics and adjustments.

12.2. Site Access and Preparation. You will provide unrestricted access to all areas necessary for the completion of the work during normal working hours or as otherwise arranged. You will ensure the site is prepared and ready for our work as scheduled.

12.3. Utilities. You will provide, at no cost to us, all necessary utilities including electricity, water, heat, and internet connectivity as required for the execution of the work.

12.4. Storage. You will provide a secure, dry, and temperature-controlled area for storage of materials and equipment delivered to the site.

12.5. Coordination with Other Contractors. You will coordinate the activities of other contractors or service providers whose work may affect or be affected by our work.

13. OBSOLESCENCE

13.1. Obsolete Equipment Definition. We will not be responsible for maintaining obsolete equipment. For purposes of this Agreement, we may consider equipment obsolete when more than 20 years have passed since installation. Equipment may also be considered obsolete if:

• Equipment components are becoming obsolete
• Replacement parts are no longer readily available
• Manufacturer support is being discontinued
• Equipment is approaching the end of its serviceable life

13.2. Obsolete Equipment Options. When equipment becomes obsolete, we will provide you with:

• Estimated remaining usable life of the equipment
• Options for continued maintenance using available parts
• Recommendations for equipment replacement or modernization
• Indicative pricing for recommended options

13.3. Service Modifications for Obsolete Equipment. If equipment becomes obsolete during this Agreement, we will negotiate in good faith to modify the service scope and pricing to address the obsolescence issues.

13.4. Proprietary Software and Equipment. We will not be responsible for replacement or updates of proprietary equipment or software that is only available through original equipment manufacturers.

14. INDEMNIFICATION

14.1. You agree to defend, indemnify and hold harmless Action, its officers, agents, employees and insurers against any and all liability, loss, damage, action, cause of action or expense (including court costs and reasonable attorneys’ fees) which may result from any loss, injury, death to any person or tangible personal property that arises out of or is caused by any negligent act or wrongful act or omission of the Customer, its officers, agents or employees (or the Customer’s subcontractors, or any of said subcontractor’s officers, agents or employees) in connection with, or in any way arising out of (i) this Agreement, (ii) any use of the Customer’s equipment that is the subject of any of the Services, or (iii) any other contractor’s performance of services on any of Customer’s equipment which may have been the subject of the Services. Customer’s obligation to defend and indemnify shall survive any termination or expiration of this Agreement.

15. MODERNIZATION AND REPAIR RIGHTS

15.1. Right of First Refusal.

• During the term of this Agreement and for a period of one (1) year following its expiration or termination, you agree to grant Action a right of first refusal with respect to any modernization, upgrade, replacement, or substantial repair project (“Project”) for the equipment covered under this Agreement.
• Before entering into an agreement with any third party for a Project, you will provide Action with written notice describing the scope of the proposed Project (“Project Notice”). Within fifteen (15) business days of receiving such Project Notice, Action will notify you in writing whether it elects to undertake the Project.
• If Action elects to undertake the Project, the parties shall negotiate in good faith the terms of a separate agreement for such Project. If the parties cannot reach agreement on terms within thirty (30) days of Action’s election to undertake the Project, you may proceed with soliciting proposals from third parties, subject to Section 15.2 below.
• If Action declines to undertake the Project or fails to respond to the Project Notice within the fifteen (15) business day period, you may proceed with soliciting proposals from third parties, subject to Section 15.2 below.

15.2. Right of Last Offer.

• Before accepting any third-party proposal for a Project for which Action declined its right of first refusal or for which the parties failed to reach agreement on terms, you will provide Action with written notice of the material terms of the highest-ranked third-party proposal, with the third party’s identifying information redacted (“Last Offer Notice”).
• Action shall have ten (10) business days from receipt of the Last Offer Notice to submit a final proposal to undertake the Project on terms no less favorable to you than those contained in the third-party proposal.
• If Action submits a proposal that is at least as favorable to you as the third-party proposal, you must accept Action’s proposal. If Action’s proposal is not as favorable or if Action fails to submit a proposal within the ten (10) business day period, you may proceed with the third-party proposal.

15.3. Excluded Projects. The rights set forth in Sections 15.1 and 15.2 shall not apply to:

• Emergency repairs necessitated by safety concerns or equipment failure that require immediate attention;
• Minor repairs or maintenance with a total cost of less than $5,000; or
• Projects that are part of a building-wide renovation or construction project managed by a general contractor, provided that Action shall be included in the bidding process if bidding is conducted.

15.4. Continuity. If you engage a third-party for a Modification Project, any maintenance agreement in effect with us will remain in effect after the completion of the Modification Project at Action Elevators discretion. The period during which the equipment was out of service for modification will be added to the Term of such maintenance agreement.

15.5. Confidentiality. You will maintain the confidentiality of all proposals submitted by Action pursuant to this Section 15 and shall not disclose the terms of such proposals to any third party without Action’s prior written consent.

16. WARRANTY AND DISCLAIMER

16.1. Action shall use its commercially reasonable efforts to deliver the Services in a manner which minimizes errors and interruptions in the Services. Services may be temporarily unavailable due to Force Majeure Events, or because of other causes beyond Action’s reasonable control, but Action shall use commercially reasonable efforts to provide advance notice in writing or by e-mail of any scheduled service disruption.

16.2. NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED IN THIS AGREEMENT, ACTION DOES NOT WARRANT THAT THE SERVICES WILL BE UNINTERRUPTED OR ERROR FREE; NOR DOES IT MAKE ANY WARRANT AS TO THE RESULTS THAT MAY BE OBTAINED FROM THE USE OF THE SERVICES. EXCEPT AS EXPRESSLY SET FORTH IN THIS SECTION, THE SERVICES ARE PROVIDED “AS IS” AND ACTION DISCLAIMS ALL WARRANTIES, EXPRESS OR IMPLIED, INCLUDING, BUT NOT LIMITED TO, IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE.

17. MISCELLANEOUS PROVISIONS

17.1. Notices. All notices under this Agreement must be in writing and delivered by certified mail, courier, or email with confirmation of receipt to the addresses specified in the Statement of Work.

17.2. Severability. If any portion of this Agreement is deemed invalid or unenforceable, such finding won’t affect the validity or enforceability of any other portion.

17.3. Waiver. No waiver of any provision of this Agreement will be effective unless in writing. No waiver of any breach will constitute a waiver of any subsequent breach or of any other provision.

17.4. Survival. Provisions that by their nature are intended to survive termination or expiration of this Agreement will survive, including but not limited to liability limitations, warranties, confidentiality, and dispute resolution.

17.5. Governing Law. This Agreement is governed by the laws of the State of Maryland without regard to its conflict of laws principles.

17.6. Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. Electronic signatures shall be deemed original signatures.

17.7. Amendment. This Agreement may only be amended by a written document signed by authorized representatives of both parties.

17.8. Modifications to Standard Terms and Conditions. We may modify these Standard Terms and Conditions from time to time by providing you with at least sixty (60) days’ advance notice of such changes (“Modification Notice”). The Modification Notice will:

• Identify the specific changes being made
• Include a complete copy of the revised Standard Terms and Conditions
• Specify the effective date of the modifications
• Explain your right to opt out as described below

If you do not wish to accept the modified Standard Terms and Conditions, you must notify us of your decision to opt out within thirty (30) days of receiving the Modification Notice. If you opt out, this Agreement will continue under the existing terms until the end of the then-current term, at which point it will automatically terminate without further obligation by either party. Your failure to provide written notice of opt-out within the thirty (30) day period will constitute acceptance of the modified Standard Terms and Conditions. Notwithstanding the above, modifications that are required by law or that do not materially reduce your rights or increase your obligations under this Agreement may be implemented immediately upon notice to you without right of opt-out.

17.9. Counterparts – Electronic Signatures.

• This Agreement may be executed in any number of counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. Delivery of an executed counterpart of this Agreement by facsimile, email in PDF format, or by any other electronic means intended to preserve the original graphic and pictorial appearance of a document shall have the same effect as physical delivery of the paper document bearing an original signature.
• Electronic Signatures. The parties agree that electronic signatures, whether digital or encrypted, including those transmitted via DocuSign, Adobe Sign, or other similar electronic signature platforms, are intended to authenticate this writing and to have the same force and effect as manual signatures. Electronic signature means any electronic symbol or process attached to or logically associated with a record and executed or adopted by a person with the intent to sign such record, including facsimile or email electronic signatures.
• Consent to Electronic Delivery. Each party agrees that the electronic signatures of the parties included in this Agreement are intended to authenticate this writing and to have the same force and effect as manual signatures. Electronic signature means any electronic sound, symbol, or process attached to or logically associated with a record and executed or adopted by a person with the intent to sign the record.
• Legal Effect. The parties intend that each electronic signature rule and law, including the Electronic Signatures in Global and National Commerce Act (E-SIGN), Uniform Electronic Transactions Act (UETA), or any similar state law based on UETA, shall apply to this Agreement. The parties further intend that this Agreement shall be subject to the provisions of such laws such that this Agreement shall be legally enforceable if it:
• is available in a form that is capable of being retained and accurately reproduced for later reference by all parties; and
• all other requirements of applicable law have been satisfied.
• Future Documents. The parties agree that any future documents requiring signatures that are related to this Agreement may also be executed electronically and subject to the same provisions as set forth herein.