General Terms of Service Of kraft curing systems gmbh (hereafter “KCS GmbH”)

These standard terms for installation, commissioning and service of plants, plant sections, spare parts for such between KCS GmbH and each Customer apply exclusively if they are not changed expressively by an agreement in writing between the parties.
The offer, the acceptance of the offer, confirmation of order or the sale of the above mentioned services are subject to the conditions submitted. Any conditions or provisions changing the contract from the Customer will be contradicted; they only are effective towards KCS GmbH if they agree to these changes in writing.
These provisions present the basis for any single business in future between KCS GmbH and the purchaser and they exclude any other agreement.

These General Terms of Service are part of the General Terms and Conditions of KCS GmbH GmbH and are deemed to apply to KCS GmbH and the Customer of an assembly (hereinafter called “Customer”), insofar as both parties have not expressively made contrary agreements in writing, for the assembly and commissioning of machines, plants or aggregates and with no change in the substance for any other work at the place of assembly to be carried out by the staff or representatives of KCS GmbH and as well as for repair work and modifications in the workshops of KCS GmbH alike.

I. Conclusion of the Contract

The terms and conditions of KCS GmbH shall apply exclusively. Any deviating ones or such ones supplementing them on the part of the Customer are not binding for KCS GmbH, even if KCS GmbH does not contradict to them. Any other conditions and terms and deviations shall only become effective if KCS GmbH approves them expressively and in writing.

II. Duties of KCS GmbH GmbH

KCS GmbH commits itself to execute professionally the work to be carried out by qualified personnel or to have them executed by a qualified third party.

III. Technical Documents

All the technical documents remain the property of KCS GmbH and must neither be copied, reproduced nor brought to the attention of a third party in any kind without its prior approval in writing. It is only allowed to use them for assembly, commissioning, operation and maintenance in connection with the delivery and performance of KCS GmbH.

IV. Customer’s Participation

1. Customer shall have to do everything necessary that the work can be started in time and be executed continually.

2. Customer shall have to execute and to have all the on-site services as well as any other preparing work executed professionally at his expense, if applicable corresponding to such documents provided by KCS GmbH.

3. The staff from KCS GmbH is then to be sent for, if all the preparing work has been completed.

4. Customer shall have to guarantee that entry and exit permits, residence permits, work permits and any other of such ones can be made available for the personnel of KCS GmbH.

5. Customer shall have to take all the required accident prevention measures at his expense. In particular, he shall point out expressively in due time prior to commencement of work if any particular attention shall be given or any other relevant regulations shall have to be observed. KCS GmbH is entitled to refuse or suspend any such work if safety is not guaranteed.

6. In case of accident or illness of the staff of KCS GmbH, Customer shall give necessary support.

7. The material to be assembled shall be stored and protected from damaging influences. In the presence of the personnel of KCS GmbH Customer shall check the material for completeness and possible damage prior to commencement of work. KCS GmbH is not liable for damages in transit, if such transports are carried out by Customer or any third party in charge of Customer.

8. Customer shall have to ensure that the transport routes to the site / place of assembly are of suitable quality and the site / place of assembly itself are in a ready-to-work condition. Moreover, the access to the site / place of assembly shall be granted unhindered. All the necessary rights of way shall be given.

9. Customer shall grant the availability free of charge of heated or air-conditioned and secured rooms for the assembly supervisor and the personnel of KCS GmbH and reasonable sanitation as well as secured, dry rooms for the storage of material and tools. All these rooms shall be situated in the immediate proximity of the workplace.

10. Customer shall perform in due time according to the instructions of the personnel or assembly program of KCS GmbH the following:

10.1 Providing qualified skilled workers and assistants according to the confirmation of order like locksmiths, welders, electricians, bricklayers, painters, plumbers, etc. with the correspondingly necessary tools and equipment. These workers shall have to follow the instructions of the personnel of KCS GmbH, but they remain employed by Customer and under its supervision and responsibility.

10.2 Providing unserviceable cranes and lifting gears with corresponding operators, purposeful scaffolds and transport means to transport personnel and material, corresponding workshop equipment and measuring devices.

10.3 Providing necessary consumables and installation material, detergents and lubricants as well as the necessary assembly incidentals at cost.

10.4 Providing the required power and light including the necessary connections up to the site, place of assembly, heating, compressed air, water and any other working materials.

10.5 Providing the communication ports (telephone, modem), if applicable including the required terminals.

11. KCS GmbH recommends using the future operating personnel for collaboration at the assembly work in order to familiarize it with each technology. KCS GmbH shall be prepared to give Customer’s operators the technical training during the installation and assembly work on the basis of a special agreement.

12. Customer shall ensure that KCS GmbH shall have been granted in due time the necessary permits for the import and export of tools, equipment and material.

13. Any tools and equipment as well as any remaining material which were provided by KCS GmbH shall be returned immediately at expense and risk of the Customer after the completion of installation and assembly work.

14. If Customer does not fulfill or does Customer only fulfill the pre-mentioned duties in parts, then KCS GmbH is entitled to carry them out itself or to have them carried out by a third party. Such costs arising from the non-fulfillment shall be payable by Customer. He shall release KCS GmbH from third parties’ claims.

15. Customer shall have to inform KCS GmbH in due time on special legal and official and any other regulations regarding the execution of the assembly and the operation.

V. Work separate from the Contract

Customer shall not be entitled to enlist its personnel for work being not covered by the Contract without the expressively written authorization of KCS GmbH to do so. KCS GmbH shall not assume responsibility for work being executed without any special instruction by KCS GmbH by order of the Customer. That working time spent on that shall be paid according to the hourly pay rate in its last version.

VI. Working time

1. The daily regular working time amounts to 8 hours and lies between 6:00 and 20: 00 h. The weekly regular working time is 40 hours and is normally split on 5 working days. The regular working time shall be calculated if a shorter time has to be kept to for reasons which KCS GmbH shall not be responsible for. The personnel of KCS GmbH shall take into account Customer’s special operational situation and local situations with regard to the individual definition of working time.

2. Such working hours being performed beyond the regular weekly and daily respectively working time are seen as extra work. Such extra work shall only be allowed under mutual agreement. Such extra work should exceed the daily working time by not more than 2 hours and the regular weekly working time by not more than 10 hours.

3. Night work is that work being performed between 20:00 h and 6:00. Any working hours being performed during this nighttime shall be deemed to be extra work.

4. Any work performed on Sundays and public holidays between 0:00 h and 24:00 h shall be deemed to be work on Sundays and public holidays. Such days with a general rest from work at the working place shall be deemed to be Sundays and public holidays. Such work on Sundays and public holidays is only allowed in urgent cases and under mutual agreement.

VII. Journey Time and any other Times equated to Working Time

1. Journey time and reasonable times of preparation and handling to meet orders (reporting and evaluation) shall be deemed to be working time according to point 6.

This applies especially for the following times:

- Expenditure of time for the journey to and from the place of assembly
- The time for the entry of the accommodation at the place of assembly as well as for official formalities of registration and cancellation.

2. Can no reasonable accommodation and catering facility near the working place be found, then the needed daily time for the way between the accommodation and catering place respectively (travel time) shall be calculated like working time, if one-way travel requires more than half an hour. Customer shall be charged for all the expenses arising in this context as well as costs for the necessary use of any reasonable means of transport.

3. Should the personnel of KCS GmbH be hindered in its execution of work or be restrained for circumstances which KCS GmbH may not be held responsible for, KCS GmbH shall calculate the waiting times like working times. Customer shall be charged with all the remaining costs in connection with this, too. The same applies for any other downtimes which KCS GmbH shall not be liable for.

VIII. Costs

1. Work shall be billed on a flat-rate basis on the clock and according to actual expenses (result) or, according to agreement.

2. In case of work according to result the performance shall be invoiced as follows:

2.1 Personnel Costs

2.1.1 Customer shall certify the personnel of KCS GmbH the daily actual working times on the submitted working time sheets. Any discrepancies shall be clarified prior to their signing. A later complaint concerning the times recorded on the working times sheet is not possible. If Customer does not sign timely, then the records made by the personnel of KCS GmbH shall be deemed to be accepted by Customer and correct. If Customer refuses the signature on the working time sheet, then the personnel of KCS GmbH is entitled to postpone the further work until the facts have been sufficiently clarified. The causing contractual party shall have to pay for the additional costs incurred in this respect.

2.1.2 The hourly pay rates determined on the supplement “Assembly Tariffs” shall apply.

2.2 Journey Expenses

2.2.1 Customer shall be billed for the expenses on the clock and according to actual expenses for return journeys as well as for travels within the country of assignment by train, ship, plane or any other necessary means of transport including the necessary additional expenses such as e.g. for insurances, freight and customs concerning luggage, passport and visa fees, granting entry and exit permits, residence and working permits, required medical checks when leaving and returning as well as for vaccinations of the personnel of KCS GmbH.

2.2.2 Insofar as any special circumstances do not require the use of another class, KCS GmbH shall charge Customer for:

- Air travel in the Economy Class
- Rail travels tickets of the Second Class
- Car mileage allowances according to supplement “Assembly Tariffs”

2.3 Separation Allowance
The personnel of KCS GmbH shall have a claim for a healthy and sufficient catering as well as for a good an clean, heated and air-conditioned respectively single accommodations at the place of assembly or nearby. KCS GmbH shall charge Customer the flat-rate amounts for additional meal expenses and overnight stays according to the Federal Ministry of Finance as amended in order to cover the catering and accommodation expenses insofar as such ones shall not be assumed directly by Customer as well as the incidental expenses for beverage, laundry, etc. if the accommodation and catering are given, KCS GmbH shall charge Customer with 50 % of the flat-rate amount for additional meal expenses in order to cover the other costs.

2.4 Journeys Home
The personnel of KCS GmbH shall have claim for paid journeys home in case of a stay of more than three weeks for assemblies within the EU, in case of a stay of more than six weeks for assemblies outside the EU. Customer shall bear the costs for the round trip from the place of assembly to the registered office of KCS GmbH. The expenditure of time for the round trip as well as the separation allowances shall be calculated according to the points 7.1, 8.2.2 and 8.2.3.

2.5 Costs of Tools and Instruments
Daily and hourly pay rates cover the costs for providing the devices in a standard equipment with ordinary tools and standard devices. For the assembly of plants KCS GmbH sends a tool container which is completely equipped. KCS GmbH shall just calculate costs for transport and insurance as well as possibly incurring fees and charges related to the import and export of the container.

2.6 Consumables and Small Items of Equipment for Assembly
Such consumables, material for installation and small items of equipment for assembly being supplied by KCS GmbH shall be calculated according to actual expenses.

2.7 KCS GmbH shall charge Consumer for all the contributions such as taxes, fees and those for the social security and such related ones which KCS GmbH shall have to pay in connection with this contract outside the Federal Republic of Germany.

3. Flat Assembly

3.1 The written agreements shall apply for the scope of the work assumed at a flat rate. Such a flat rate shall cover all the work stipulated and to be executed by KCS GmbH. This provides a trouble-free workflow and the determination of the preparing work in time as well as the ancillary services of any kind which shall be executed by Customer..

3.2 Customer shall bear any additional expenses incurring to KCS GmbH due to any such circumstances like subsequent changes of the content or scope of the work agreed, due to waits, night work, additional journeys, etc. which KCS GmbH shall not be held liable for. Invoicing shall be effected according to point 8.2.

IX. Terms and Conditions of Payment

1. Unless stipulated otherwise, the costs for assembly shall be invoiced towards the end of the month. Payments shall be payable immediately, in Euro, net cash. The kind of the settlement of payment shall be determined individually. Referring to the payment the date of settlement shall be that day on which KCS GmbH has the amount.

2. Customer shall not be entitled to retain or reduce payments due to complaints, claims or any counterclaims being not accepted by KCS GmbH. Payments shall be settled even then when work is delayed or becomes impossible for reasons KCS GmbH shall not be liable for.

3. If a payment deadline is not met without requiring a special reminder, the consequences of default shall occur. Notwithstanding any other or further-going rights and claims the annual rate of default interest amounting to 8 percentage points above the rate of the main refinancing facility of the European Central Bank shall be owed. Paying any default interest shall not annul the obligation to pay in accordance with the contract.

4. In case of a default, KCS GmbH shall not be entitled to declare all the claims against Customer to be immediately due.

X. Period for the execution of the work

1. The prior confirmation in writing shall make the period for the execution of the work binding for KCS GmbH. The period shall begin when all the assumptions for the start of work are given; such one is deemed to be kept to, if the work has been completed or insofar as they shall be executed in parts, if they have been finished for relevant part.

2. A completion of work is deemed to be given if parts lack or rework is needed provided that the operational readiness is basically granted.

3. The period shall lose its validity if:

- Customer’s contributions which are required during the execution of work have not been received in time by KCS GmbH or if Customer changes subsequently such contributions and causes a delay of work,

- Customer shall not fulfill his duties out of this contract, in particular the payment obligations according to point 9 as well as the duty to co-operate according to point 4 or if Customer’s suppliers should be in arrears with their work,

- in case of any such circumstances which KCS GmbH shall not be liable for (Force Majeure), e.g. if mobilization, war, civil war, riots or sabotage threaten or have already been occurred as well as in case of industrial disputes, accidents, illnesses, delayed or defect supplies of the materials required, measures or failures on the part of any authorities or governmental bodies, unforeseeable transport obstacles, fire, explosion and natural phenomenon.

4. Should the personnel of KCS GmbH be endangered or tremendously hindered in its execution of work which KCS GmbH cannot be held liable for, then KCS GmbH shall be entitled to instruct its assembly personnel to return. For such cases as well as for such ones that the personnel is held back after the completion of work, then Customer shall be charged for the corresponding hourly pay rates or daily pay rates respectively as wait and journey costs in addition to the catering and accommodation costs.

XI. Risk

1. Customer assumes the risk for the material to be assembled during the execution of the work. Should any objects, plants, etc. be damaged or destroyed due to such reasons KCS GmbH may not be held liable for, KCS GmbH shall reserve the right to claim for the remuneration stipulated.

2. Customer also assumes the risk for the tools, equipment and material being made available by him.

XII. Liability

1. KCS GmbH and its assistants and vicarious agents shall be liable for the personal injuries or damage to material culpably caused to Customer on the merits and to the extent to within such ones any German insurance company would normally grant cover. Liability shall be limited to the price of the work, the maximum shall be EUR 500.000,-, however, per damaging event. Any further claims and rights on the part of the Customer shall be excluded, especially due to any loss of production or loss of profit.

These restrictions shall not apply for any unlawful intent or gross negligence of KCS GmbH, however, they shall also apply for any unlawful intent or gross negligence of any assistant personnel.

2. Customer shall be responsible for such damages being caused by its personnel. This shall also apply if such personnel controls and monitors the work unless proven gross negligence existed when executing the instruction or supervision.

XIII. Warranty

1. KCS GmbH grants warranty for its professional and careful work for the period of 12 months, but for the maximum of 2.500 operating hours after the completion of work according to the conditions hereinafter mentioned.

2. Should work be interrupted for reasons as mentioned in point 10.3., the warranty period shall start for such work completed prior to the interruption for three months after the beginning of the interruption at the latest.

3. Such defective work at the objects, plants, etc. at which work was carried out, shall be removed free of charge, if they are discovered during the warranty period, provided that KCS GmbH is informed in writing immediately after its discovery. KCS GmbH shall only assume warranty for defects due to work of Customer’s personnel or one third party charged by Customer, even under supervision of KCS GmbH’s personnel, if such defects are due to gross negligence of KCS GmbH’s personnel when executing the instruction or supervision.

4. Warranty expires if Customer or third party make a change or repair without any approval in writing by KCS GmbH; if other than original parts are used which were delivered by KCS GmbH or if Customer does not take prompt and appropriate steps to minimize any damage.

5. For rectification work within the frame of warranty KCS GmbH shall assume warranty to the same extent like for the original work, but not beyond this applicable time of warranty.

6. Any further-going claims and rights due to any defects other than such ones mentioned under points 13.1 to 13.5 shall be excluded.

XIV. Arbitral Tribunal – Law

1. Insofar as the subject matter of this contract is the world-wide delivery of plants or plant sections as well as the delivery of individual parts to any places outside the EU, the following arbitration clause shall be agreed upon:

a) All disputes ensuing from or in connection with the above mentioned business relations shall be definitely decided in accordance with the Arbitration Code of the International Chamber of Commerce (ICC) by one or more arbitrators designated in accordance with the above provision..

b) Arbitration proceedings are deemed to be executed by the ICC Swiss Commission of Arbitration, Hegibachstr. 47, CH-8032 Zurich, as the arbitration board. Both parties accept the arbitration of the arbitration board as a binding one. The arbitration costs shall be divided for proof of between both parties. Proceedings are deemed to be conducted in German. Would such an arbitration judgment be unenforceable, the exclusive place of jurisdiction is deemed to be Emden. However, KCS GmbH shall be entitled to file suit at Customer’s registered office.

2. Insofar as the delivery of individual machine parts to places within the EU is the subject matter of this contract, then ordinary German jurisdiction is agreed upon and so Emden is expressively agreed as the legal venue.

3. All the contracts concluded with KCS GmbH shall be without exception and exclusively subject to the substantive law of the Federal Republic of Germany.

XV. Final Provisions

1. Any amendments to the contract shall only be binding if they are confirmed in writing.

2. Any explanations of any kind given by the personnel of KCS GmbH shall only be binding if confirmed in writing by KCS GmbH.

3. Should one or more provisions may become ineffective, this does not influence the validity of the remaining provisions. Both parties shall be obliged to replace ineffective provisions by such ones which approximate the economic purpose of the contract as closely as possible.

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