General Terms & Conditions (GTC)

SND PorzellanManufaktur GmbH – General Terms & Conditions

I. SCOPE AND DEFINITIONS

1. Any deliveries and services, including consultancy services, information etc., shall exclusively be rendered in accordance with our Standard Terms and Conditions of Business set forth below, provided, they have not been amended or excluded with our written consent. Any conflicting terms and conditions or terms and conditions of a customer deviating from our Standard Terms and Conditions shall not be accepted by us, unless we expressly agreed in writing to their validity. To the extent our customers are business owners in the meaning of § 14 BGB [= German Civil Code], the present terms and conditions shall also apply to any future business transactions with a contractor.

2. Business owner in the meaning of these Standard Terms and Conditions is any natural person or entity or any legal corporation which acts, upon closing of a legal transaction, in their capacity as a commercial or self-employed entity. Consumer is any natural person who conducts a legal transaction for a purpose that is neither associated with their commercial nor self-employed job activities. Customer is any person who closes a contract with us within the scope of these Standard Terms and Conditions, regardless if they are business owners, consumers or neither of it. Any regulations for business owners shall also apply to public authorities.

II. OFFER AND CLOSING OF CONTRACT, SUBJECT TO CHANGE CLAUSE

1. Any information, images and drawings included in our brochures, catalogues, newsletters, ads, or price lists are merely approximate parameters. They shall not be considered as warranted properties, but merely as descriptions or specifications of deliveries or services. Usual deviations and deviations which base on legal provisions or present technical improvements shall be permitted, provided they do not impair usability for the contractually agreed purpose.

2. Our offers are subject to change and shall only become binding upon written confirmation. Any oral agreements and warranties given by our employees in connection with closing of a contract shall only become binding upon our written confirmation. This shall apply accordingly to any changes of contract. With the exception of our managing directors or procurators, none of our employees is entitled to agree on any oral arrangements deviating from the present terms and conditions.

3. Any offers of customer shall only be considered accepted upon express written declaration or upon delivery on our part. Silence in reply to such an offer does not denote consent. In order to meet the written form requirement it shall suffice to send a telefax; besides, transmission by E-mail shall be sufficient.

4. In the event a customer is of the opinion that our order confirmation deviates from his order, he shall immediately after receipt of such confirmation, however, within one week after the date of our confirmation at the latest, notify us of such alleged deviation, because otherwise our confirmation shall be considered correct and binding for both parties. Any subsequent request of customer relating to changes which result in additional costs with view to the then current state of order processing, shall be invoiced by us with such additional costs and extended delivery date. Such changes require written confirmation.

5. In the event of orders to be delivered to any third party, the ordering party shall be considered contractor provided nothing else has been expressly agreed.

III. PRICES / PRICE ADJUSTMENTS

1. Our prices are net ex works/warehouse Zeulenroda site, or ex works/warehouse of our contractors, plus freight, packaging, postage, insurance as well as statutory VAT applicable at that time in Euros; in the event of export deliveries, plus customs duty and fees, and other public charges.

2. Any prices referred to in our offer are subject to the order data stated in the offer documents, and shall be applicable for a period of three months of receipt of such offer by customer at the latest. Any subsequent changes requested by customer, including standstill of machinery caused by such changes, shall be charged to customer. Also repetitions of sample prints requested by customer due to minor deviations from templates are considered as subsequent changes. Any sketches, drafts, test samples, test prints, galley proofs, changes of delivered/transmitted data and similar preparatory works caused by customer will be invoiced. The same applies to data transmissions (e.g. ISDN, DSL). Drafts, sample sets, sample prints and similar preparatory works shall be invoiced even if no order is placed.

3. In the event costs of material or wages/salaries in our contracting plant, or customs duties and other sales taxes or charges are increased after order confirmation, we shall be entitled to increase our prices ex aequo et bono in the context of a continuous obligation or if delivery is scheduled later than 4 months after closing of a contract. The same applies if a delivery has not been requested by customer within 4 months after closing of a contract, or a delivery cannot be completed under the terms and conditions agreed upon closing of contract for reasons which are within the scope of responsibility of customer.

IV. DELIVERY/SHIPMENT/DELIVERY DATES AND DEADLINES

1. Our obligation to deliver is subject to correct and timely self-delivery, unless such incorrect or delayed self-delivery has been caused by us.

2. Any information as to delivery dates are just estimates. Delivery periods shallcommence on the date of our order confirmation, however, not before full clarification of any details of an order, and not before receipt of records, approvals, and releases to be obtained by customer and not before receipt of possibly agreed advance payments. If no delivery dates have been agreed, but a delivery period basing on a certain period of time, such period shall commence upon the date of release. For the term of testing of press proofs, production samples etc. by customer, a delivery term shall be suspended starting from the date of sending the items to customer until the date of receipt of a respective statement. In the event customers request changes after order confirmation which affect the duration of manufacture, a new delivery term shall commence upon confirmation of such change.

3. The date of sending an item ex works/warehouse shall be authoritative for calculating delivery deadlines and time-limits. Such deadlines shall be considered kept upon notification of readiness to ship, in the event goods cannot be shipped on time or have to be stored without any default on our part.

4. In the event shipment or delivery and service are postponed by more than one month after notification of readiness to ship upon request of customer, we shall be entitled to charge to customer storage expenses of 0.5% of the price of goods of such delivery for each commenced month, however, 5% at a maximum. Proof of higher or lower storage expenses by either party shall remain unaffected.

5. Choice of type and route of shipment is reserved, provided nothing to thecontrary has been agreed in a respective order. Transport insurance will be obtained upon specific request of and on account of contracting partner.

6. Self-collectors who do not exchange Euro pallets upon collection, shall be charged with EUR 12.- per Euro pallet. We shall be entitled to partial deliveries which are due and payable basing on our payment terms.

7. In general, the ordered quantity will be delivered. Any excess deliveries or short supplies up to 10% shall be acceptable with specific orders and printing matters due to operational reasons. It shall be permitted to commercially round ordering quantities to a minimum quantity and/or the next possible package unit.

V. CORRECTIONS

1. Any corrections of whatever kind (e.g. text, colours, forms, decoration), also corrections relating to delivery addresses etc. require written form. Customer may request a press proof which will be charged. In the event of difficult and extensive setting works, unsolicited corrections may be sent to contracting partner.

2. Due to unusability of data provided or changes required due to deviations from setting copy, in particular corrections by ordering party, shall be charged to customer basing on working hours spent and material used.

3. Galley proofs and press proofs shall be reviewed by customer regarding setting errors and other errors as well as regarding correctness of decoration colours and elements, and shall be released toward us. We shall not be liable for any errors overlooked by customer. Any changes requested by telephone shall be confirmed in writing by contractors.

4. In case of small orders, we are under no obligation to forward a press proof to customer. If forwarding of a press proof is not requested, liability for setting errors shall be limited to gross negligence. If, for whatever reason, it is waived of press proof samples, any rights to claim errors relating to texts, decoration colours and elements shall extinguish.

5. Setting and press proof shall also be charged if an order is cancelled or withdrawn.

VI. QUALITY REQUIREMENTS (IMPORTED GOODS)

Due to manufacturing opportunities for china existing in the countries of manufacture, in particular in case of mass productions, the quality standard of mass-produced articles in usual “oven sorting” shall apply. Oven-sorted goods usually display the following minor defects of the ceramic/china final product which are to be accepted by customer, and which do not present a reason for rejection: orange-peel, glazing flowmarks, glazing colour deviations, glazing shine tolerances, impurities, iron spots and counters. Patterns are of average quality.

VII. CERAMIC COLOUR PRINTING

1. Due to tolerances of the item to be printed in direct printing, a 100% homogeneous print image and exact gauge-pins cannot be achieved. Accordingly, any respective deviations from a colour copy provided, or simulated or unsimulated press proof samples, are to be accepted by customers.

2. When decorating with ceramic transfer pictures, decors will be manually applied to the china item; consequently, certain tolerances relating to standing preciseness (1-2 mm) must be accepted and are no reason for rejection.

3. Dishwasher-proof: Ceramic colour printings and in-glaze sprayings are burnt at high temperature, and accordingly they are dishwasher-proof according to DIN 12875. We do not accept any liability for the duration of life period since life period depends on the washing-up liquid used and hardness degree of water.

4. In the event of XPression colours, soft touch paint and any other production procedures, please observe specific notes given in the relevant order confirmation.

VIII. REPRODUCTION OF COLOURS

Ceramic colour printing procedures are not being applied according to Pantone or HKS scales. They can be adapted to these scales only under certain conditions. Also due to thermal influences (onglaze fire) and resulting chemical reactions as well as due to additive colour mixing of decoration colours with underlying glaze, deviating colours of décor cannot be excluded, and are no reason for rejection. Deviations of colour in the final result of onglaze fire compared with the press proof sample up to DeltaE 6, depending on glaze colour, are to be accepted and are no reason for rejection.

IX. PRINTING COLOURS

In the event of coloured reproductions in ceramic colour printing as well as with any other production procedures, minor colour deviations compared to the original or press proofs as well as within one and the same edition and among edition prints are possible. Such deviations do not entitle to deficiency claims. Colour reproductions without press proof sample shall not be considered printing resultoriented blind blocking, and accordingly do not entitle to claims relating to colour defects. Colour quality liability in the context of technical conditions shall only be granted in case of deviations from press proof sample by more than DeltaE 6.

X. PAYMENT CONDITIONS/SET-OFF

1. Our invoices are due and payable within 30 days of invoice date without deduction unless something different has been agreed on. Payments must be effected in a way that the relevant amount is at our disposal on the day of maturity. Any expenses of payment transactions are to be borne by customer.

2. If ordered goods are being stored on our premises or our supplier’s premises after manufacture and prior to delivery to customer, an invoice will be issued with the date of storing of goods in a warehouse.

3. With customers who are unknown to us we reserve the right to claim advance payment.

4. Upon expiry of payment deadlines, a customer is immediately in default with his payments, and accordingly we shall be entitled to claim default interest of 8% points p.a. above the relevant ECB basic interest rate if contractor is a business owner (§ 14 BGB), or 5% points if contractor is a consumer (§ 13 BGB). If we are able to proof greater damage due to default, we shall be entitled to claim it. However, customer shall be entitled to produce evidence that we have incurred no or lesser damage as consequence of his default in payment.

5. If after closing of a contract it becomes obvious that our claim to payment is jeopardized due to lack of financial capacities of customer, or if customer is in default with a major amount, or if other circumstances occur which indicate to a  materially worsened financial capacity of customer after closing of contract, we shall be entitled to exercise the rights according to § 321 BGB. We shall be entitled to withdraw our deliveries and to set customer a reasonable time-limit for payment of advance payments or provision of securities. After lapse of such timelimit we shall be entitled to withdraw from a contract.

6. Set-off against possible counter-claims shall only be permitted for customer if it is about undisputed or final and binding claims. Customer shall only be entitled to exercise retention rights to the extent that his counter-claim results from the same contractual relationship. In case of extraordinary advance performances reasonable advance payment may be claimed.

XI. DEFAULT IN ACCEPTANCE

1. If customer is in default with acceptance we shall be entitled to set a reasonable additional time-limit, and after expiry of such time-limit we may dispose of the goods as we please, or deliver these goods to customer within an additional reasonable delivery period. Our rights to cancel the contract and to claim damages for non-fulfilment shall remain unaffected.

2. In the event we are entitled to claim damages instead of performance, such damages shall equal 30% of the contractual price plus VAT. Damages are to be fixed at a higher or lower amount in the event we prove incurrence of greater damage or customer proves incurrence of lower damage.

3. Orders for goods to be delivered on demand shall be considered fixed orders and shall be accepted in a binding manner within a time-limit of 6 months provided nothing to the contrary has been agreed. If customer does not keep dates for delivery on demand, we shall be entitled to set an additional time-limit of 3 weeks and after expiry of this deadline deliver and charge the total quantity in full, or withdraw from contract and/or claim damages. In any case, after expiry of the aforementioned time-limit we shall be entitled to charge customer reasonable and appropriate storage expenses. Orders for goods to be delivered on demand will be stored for a maximum period of 1 year, and will afterwards be shipped to customer.

XII. RESERVATION OF TITLE

Consumers

1. In our contracts with consumers we reserve ownership of title relating to goods until full payment of price. Consumer shall be prohibited to dispose in any way of the goods which are subject to reservation of title until full payment.

Business Owners

2. Any delivered goods remain our property (goods subject to reservation of title) until settlement of any claims, in particular relevant balance claims to which we are entitled in the context of this business relationship (overall reservation of title). This shall also apply to any possible future and conditional claims, e.g. resulting from acceptor’s bills, and also when payments are made relating to a particular claim. Such overall reservation of title shall finally extinguish upon settlement of any claims which are pending at that time and which are associated with this overall reservation of title.

3. Business owners shall only be entitled to dispose of goods which are subject to reservation of title in the usual course of business with their usual terms and conditions and as long as they are not in default, provided, however that these claims basing on further sale according to items 4 and 5 shall be transferred upon us. Business owners shall not be entitled to dispose of goods which are subject to reservation of title in any other way. Further sale of goods in the meaning of this paragraph shall also include use of goods which are subject to reservation of title in order to fulfil contracts for services.

4. Claims basing on further sale of goods which are subject to reservation of title shall hereby already be assigned to us together with any relevant securities acquired by a business owner relating to this claim. They shall serve securing purposes of these goods in the same extent as before. If goods which are subject to reservation of title are being sold by business owners together other goods which have not been bought from us, the claim basing on further sale shall be assigned to us in the same proportion of the invoice value of these goods which are subject to reservation of title compared with the invoice value of the other goods sold. We hereby accept such assignment.

5. Business owners shall be entitled to collect receivables basing on further sale of goods. Such right to collect debts shall extinguish in case we withdraw, however, in case of default in payment or discharge of a bill or application for opening of insolvency proceedings at the latest. We shall only exercise our right to withdraw if after closing of a contract it becomes obvious that our payment claims basing on this contract or other contracts with a business owner are jeopardized due to his lacking financial capacity. Upon our request a business owner shall be obliged to immediately notify his customers about this assignment to us, and provide us with any records necessary for collection of debts.

All Customers

6. Buyer shall notify us immediately about any levy of execution or other impairments by any third party. Customer shall bear any expenses incurred for defence against access or return delivery of goods which are subject to reservation of title as far as those costs are not borne by any third party.

7. In the event of conduct of customer in violation of a contract, in particular in case of non-payment of a due and payable purchase price, we shall be entitled to take back goods which are subject to reservation of title and enter the premises of customer for this purpose, if necessary. The same applies if after closing of contract it becomes obvious that our payment claims basing on this contract orother contracts with customer are jeopardized due to his lacking financial capacity.
Such taking back of goods is not considered as cancellation of contract. Provisions of the Insolvency Code shall remain unaffected.

8. Upon customer’s request, we agree to release securities provided to us by customer relating to this contract to the extent these securities are not required anymore in the long-run in order to secure our claims, in particular if they exceed the value of our claims yet pending and unsettled, by more than 20%.

XIII. WARRANTY PERIODS/DEFECT LIABILITY/REQUIREMENT TO GIVE

NOTICE OF DEFECTS/TIME BARS

1. Statutory provisions are applicable to customer’s rights associated with factual and legal defects (including wrong shipments and short supplies) as well as improper assembly or defective assembly instructions) provided nothing to the contrary is set forth herein. Specific statutory provisions relating to final delivery of goods to a customer shall remain unaffected in any case (supplier’s recourse pursuant to §§ 478, 479 BGB).

2. Goods are in accordance with contract when they are – at the time of transfer of risks – in accordance or basically in accordance with the agreed specifications. Compliance with contract and freedom from defects of our goods shall be measured exclusively with view to express agreements on quality and quantity of ordered goods. We shall only accept liability for a specific use or suitability to the extent such has been expressly agreed. Besides, the risk of use and suitability shall be with customer. We are not liable for worsening or destruction or improper handling of goods after transfer of risks.

3. Contents of agreed specifications and a possibly expressly agreed purpose of use do not form any warranty; acceptance of warranty requires written agreement.

4. Customer who is not a consumer shall review goods received upon receipt without delay. Defects of goods shall be reported immediately in writing. Defects which cannot be detected even during most carefully performed checks shall be reported in writing immediately after detection – with immediate stopping of any processing works – however, prior to lapse of any agreed or statutory time bars at the latest. Otherwise any claims for defects against us shall be forfeited.

5. In the event of justified and timely notice of defects we may in our discretion remedy a defect or deliver defect-free goods (subsequent performance). In case of unsuccessful subsequent performance or refusal of it, customer may, after lapse of a reasonable time-limit, withdraw from contract or reduce the purchase price. If a defect is not material or if goods have already been processed, customer shall only be entitled to price reduction.

6. Expenses associated with subsequent performance shall only be borne by us if they are, depending on each individual case, reasonable, in particular compared with the relevant purchase price. Expenses incurred due to the fact that goods sold have been brought to another place than the agreed place of performance shall not be borne by us unless such is in accordance with their contractually agreed use.

7. After conduct of an agreed acceptance of goods by customer, notice of defects relating to defects which would have been detected had a proper review been performed as agreed, shall be excluded. If a customer did not detect a defect due to negligence on his part, he may only claim rights respecting this defect if we maliciously concealed this defect or granted a warranty relating to quality of goods.

8. In the event a customer does not give us immediate opportunity to inspect such defect ourselves, in particular if he does not make available the relevant defective piece of good or samples of it for testing purposes, any rights relating to such defect shall be forfeited. In case of unjustified notice of defects we reserve the right to charge customer with any relevant incurred freight and shipment expenses and testing expenditures.

9. As a rule we are not liable for defects which result from records provided by customer (e.g. drawings, schedules) or incorrect or oral information.

XIV. OVERT/HIDDEN DAMAGE

Basing on General German Forwarding Regulations, they must be reported in writing: – overt damage/short delivery at rolling note [Rollschein] – hidden damage/short delivery within 3 working days after receipt of goods – Our insurance company reserves the right to have defects inspected by an expert directly on the spot.

XV. RELEASE OF PRODUCTION

Upon written release of production customer accepts full liability for text, standing and colour errors which have been obvious already basing on approved sample(s), colour copies, press proof samples or production samples provided. Any deviations of colours according to usual tolerances in ceramic colour printing (see items VII. through IX. above) shall be accepted. Consequently, we are only liable for production defects.

XVI. GENERAL LIMITATION OF LIABILITY AND PERIOD OF LIMITATION

1. We shall only be liable – also relating to our executive employees and other agents – only in case of wilful acts and gross negligence relating to violation of contractual and external obligations; in particular for inability, default, culpa in contrahendo and unlawful acts, however, limited to damage that was foreseeable and typical at the time of closing of contract. In case of faulty violation of material contractual obligations we are only liable – save for wilful acts and gross negligence of our statutory representatives or agents – for foreseeable and typical damage. Besides, any liability, also for damages and consequential damages, shall be excluded.

2. The above limitations of liability shall not apply in the event of injuries to life or limb as well as if and to the extent we accepted a warranty relating to the quality of an item sold, and also in cases of compulsory liability according the Product Liability Act. Provisions on burden of proof shall remain unaffected.

3. If nothing was agreed as to the contrary, contractual claims which a customer might make toward us basing on or in connection with delivery of goods shall be time-barred one year after delivery of goods. Our liability because of wilful or grossly negligent violation of duty, faultily caused injuries to life or limb as well as statute of limitation regarding recourse claims shall remain unaffected.

XVII. COPYRIGHT

1. Any copyright-related utilization rights in any procedures and for whatever purpose of use relating to our own sketches and drafts, originals, films and similar items, shall remain our property subject to express other regulations.

2. Customer shall be responsible for review of rights of reproduction of any printing records. Customer alone shall furthermore be responsible in the event that exercising of his order rights result in violation of any third party’s rights, in particular copyrights. Customer shall exempt us from any third party claim associated with violation of such rights.

XVIII. USUAL INDUSTRIAL PRACTICE

Usual industrial practices of the printing industry shall be applicable in the course of commercial transactions (e.g. no obligation to surrender interim products such as data, lithographs, or films which have been produced for manufacture of the agreed final product) provided nothing to the contrary has been agreed.

XIX. ARCHIVING

Any products that a customer is entitled to, in particular data and data carriers, will only be archived by us after express agreement, and with valuable consideration, beyond the date of surrender of final product to customer or his agents. Should the aforementioned items be insured, customer shall be in charge of it if no relevant agreement has been made. We accept no liability for forwarded / provided manuscripts/blueprints etc. Films will only be stored for a maximum period of 2 years free of charge for subsequent manufacture; afterwards any necessary preliminary expenses will be charged again.

XX. ADVERTIZING

We reserve the right to use articles manufactured by us for customers as samples or for advertising purposes.

XXI. EXPORT CERTIFICATE

If a customer who resides outside the territory of the Federal Republic of Germany (extra-territory buyer) or his agent collects goods and transports or ships them abroad, customer shall provide us with a tax-wise required export certificate. If such certificate is not submitted, customer shall pay with view to the invoiced amount the VAT rate applicable to deliveries within the Federal Republic of Germany.

XXII. PLACE OF PERFORMANCE, PLACE OF JURISDICTION AND APPLICABLE LAW

1. In case of deliveries, place of performance for our services is the final customer’s delivery address; in case of personal collection our warehouse.

2. If customer is a business owner in the meaning of § 38 ZPO [= German Code of Civil Procedure], a public law corporation or public special funds entity, our place of business shall be the exclusive place of jurisdiction relating to any disputes directly or indirectly associated with this contractual relationship. The same applies when customer does not have a general place of jurisdiction within Germany or his place of residence or usual place of abode are unknown at the time of filing a lawsuit. We shall be entitled to take recourse to the court which is the competent court according to statutory provisions.

3. The legal relationship between us and customer shall be subject to German laws, in particular the provisions of the BGB / HGB [= German Commercial Code] which complement the present terms and conditions.

XXIII. SEVERABILITY

Should a contract or these Standard Terms and Conditions contain legal gaps or should individual provisions be or become invalid, any such valid and effective provisions shall apply in order to replace any legal gaps or invalid provisions which the contractual parties had agreed with view to the economic objectives of the contract and the purpose of these Standard Terms and Conditions had they been aware of such legal gap or invalid provision in the first place.