Terms and Conditions of Business

1. Validity

Copackingdesign (hereinafter referred to as „Copacking“)produces its offers, services and deliveries solely on the basis of the present “Terms and Conditions of Business” (hereinafter referred to as “Terms and Conditions”) as stipulated herein. The Terms and Conditions remain authoritative in future unless other divergent agreement or agreements are made between Copacking and its principal. These Terms and Conditions remain effective in the event that they are not enclosed with or specifically referred to within each individual sales contract. Contrary purchasing terms and conditions have no authority over or effect on the stipulations herein.

2. Conclusions of contract and prices

2.1 Copacking shall only be bound to the offers and quotations submitted after the reciprocal orders have been confirmed.

2.2 Copacking is entitled to adjust all prices listed in an order confirmation in compensation of rising imputed costs (salaries and wages, material, general business costs). In this event the principal is entitled to withdraw from the contract provided that prices have been subject of an increase exceeding 5 per cent per year since the conclusion of the contract.

2.3 In the event that necessary additional work arises which was unforeseen at the time the contract was concluded, Copacking is entitled to forward the arising costs. In the event that these extra charges exceed 10 per cent of the total price, the principal is entitled to withdraw from the contract. The principal must explicitly reject any such price increase in writing within 48 hours (mail or fax).

2.4 Copacking can forward costs and charges for preparatory work, e.g. samples, drafts, sketches etc.

3.0 Terms of payment

3.1 Invoices shall be made out under specification of delivery date, partial delivery or readiness for delivery.

3.2 Payment of invoice amount shall be made within 30 calendar days as of date of invoice without deductions. Cash discounts are only granted upon previous agreement.

3.3 Costs for shipping (freight, customs, postage etc.) and packaging must be settled as stipulated under sub-clauses 3.1 and 3.2 herein without deductions.

3.4 Copacking can make out interim invoices and request their settlement for orders performed on a partial quota basis.

3.5 In the event that the principal is in arrears or Copacking extends the term of the amount due, the latter is entitled to claim for damages at a rate of 2 per cent above the German basic rate of interest as of the respective date.

4. Right of retention, set off of invoices

4.1 Copacking retains the right of retention for materials and other objects supplied or delivered to the principal until complete settlement of all outstanding accounts.

5. Retention of title

5.1 Ownership of goods supplied is reserved until all accounts receivable presented by Copacking have been settled in full or until all checks and bills of exchange as issued for settlement have been honoured.

5.2 With the conclusion of the contract the principal thereby cedes all accounts receivable emerging from the resale of the goods subject to reservation (hereinafter referred to as “conditional commodities”).

5.3 The principal is only entitled to resell conditional commodities if the accrued receivables are transferred to Copacking. The principal is not entitled to any form of disposition of the conditional commodities (e.g. pledging, transfer of ownership by way of security). Should the principal default on payment, he shall inform Copacking of the transfer for payment to a third party as well as provide the necessary information and documents.

6. Risk, shipment

6.1 The cost and risk of shipment shall fall to the principal. Risk passes to the principal as soon as the consignment has been handed over to the person responsible for transport or has left the affiliated company’s works for the purpose of shipment. Should the goods be ready for dispatch and the shipment or removable be subject to delay for reasons beyond Copacking’s control (force majeure), risk passes to the principal with receipt of advice of dispatch.

6.2 The means and routes of transport shall be left to Copacking’s discretion unless otherwise agreed.

6.3 The consignment shall only be insured for shipment upon expressed written request of and to the expense of the principal.

7. Delivery time, delivery

7.1 Delivery times shall be approximate, unless delivery times have been explicitly set down in writing.

7.2 Should the delivery time be measured in time periods, the latter begins with the date of issue stated in the order confirmation. It ends with the course of the day during which goods have left the Copacking works or have been stored due to indispatchability.

7.3 The delivery time is interrupted for the duration and examination of transferred data, prints, finished samples, blueprints etc. by either the contractor or his principal. The interruption begins with the shipment to the principal and ends with receipt of either the contractor’s or his principal’s comments.

7.4 Any later amendments to the contract which can influence the delivery dates extends the latter appropriately unless there are agreements to the contrary.

7.5 Any delay in delivery or fulfilment due to force majeure or occurrences impeding, aggravating or rendering the delivery impossible, e.g. strike, lockout, official order etc., or when such events effect Copacking’s suppliers or their sub-suppliers, Copacking shall not be made responsible for adhering to definite and binding delivery dates. The occurrence of any such incidences entitles Copacking to postpone delivery or fulfilment for the duration of the impediment plus an appropriate reinitialisation period or to withdraw in part or entirely from the contract on the grounds of inability to fulfil contractual obligations.

7.6 Should the duration of impediment exceed three months, the principal is entitled after adequate and reasonable extension to withdraw from the contract on the grounds of non-fulfilment of contractual obligations. Should delivery time be subject to prolongation or Copacking is relieved of its obligations, the principal cannot derive any claims for damages therefrom. Copacking, however, can only plead force majeure if it immediately informs its principal.

7.7 Copacking is at all times entitled to partial delivery and partial performance inasmuch as this does not result in a undue hardship for the principal.

8. Delay in taking delivery of purchased goods

8.1 In the event that after expiration of an appropriate and adequate respite with the warning of challenge the principal continues to refuse acceptance or having seriously and definitely declared his rejection, Copacking can withdraw from the contract or sue for damages on the grounds of non-fulfilment.

8.2 In the event that the principal does not accept the consignment within an appropriate and adequate term upon order completion or promptly upon advice of dispatch or the shipment of the consignment be impossible for a prolonged period of time as a result of circumstances beyond Copacking’s control, Copacking can store the consignment either in its own stores or at a forwarding agency at risk and cost of the principal.

9. Complaints

9.1 The principal shall in each individual case examine the goods delivered, including preliminary and interim products presented for proof-reading to determine whether these are conform with the sale contract. This is particularly true for products deemed for further processing, assembly, or any other form of combining or are meant for functional purposes (e.g. bar-codes, computercodes etc.). The principal’s obligation to examine goods delivered remains intact when he has received production samples. The riskinvolving any errors passes on to the principal with his declaration of fair copy, inasmuch as following the declaration of fair copy thearising error or errors are not the result of production procedures or their recognition was dependent upon final completion. This stipulation is effective for all other statements of release as issued by the principal in regards to further production.

9.2 Complaints by reason of obvious defects or flaws shall be submitted within an exclusion period of one week upon receipt of goods. Copacking retains the right to re-examine the rejected goods. Hidden defects or flaws which could not be immediately detected upon due examination can only be asserted if Copacking receives notice of defects within six months after receipt of goods.

9.3 Defects or flaws involving a part of the completed order does not entitled the principal to reject the entire consignment.

9.4 Over- or short-shipment of up 5 to per cent of the edition ordered does not represent valid grounds for complaint. Copacking shall only invoice the factual quantities delivered. This percentage rate increases to 10 per cent for editions of pieces of up to 10,000 copies.

9.5 Minor complaints about the goods delivered do not entitle the principal to retain a part of the contractor’s remuneration. Complaints are deemed minor when the value of the subsequent improvement or redelivery is expected to amount to less than 10 per cent of total remuneration. Any other complaints or objections entitle the principal to retain a maximum of twice the value of the subsequent improvements or redelivery. The principal does not have recourse to commercial lien or remuneration or a partial remuneration inasmuch as Copacking has recognised the complaints in writing and committed itself to subsequent improvements or redelivery.

10. Warranty claims for defective quality

10.1 Should the objects delivered prove unsatisfactory or miss guaranteed characteristics or prove defective within the warranty period, Copacking shall at its discretion and under exclusion of all other warranty claims on the part of the principal supply replacements or improve subsequently.

10.2 The warranty period begins with the delivery of the goods to the principal and ends one month after the goods have left the Copacking works at the latest.

10.3 Should Copacking allow an appropriate and adequate respite to expire without providing replacements or remedying defects or flaws or should a subsequent improvement prove ineffective, the principal shall be entitled to withdraw from the contract under exclusion of all other warranty claims. Copacking’s liability for replacements or subsequent improvements comprises the same rights and obligations as the originally supplied objects. The warranty period begins anew with the replacements.

11. Compensation claims

11.1 Copacking is not liable for contract-related and at the conclusion of the contract foreseeable damages unless such damages originate from a wilful or premeditated act or gross negligence on the part of Copacking’s legal representative or managing employee.

11.2 Copacking is only liable for damages caused by wilful acts or gross negligence on the part of its other employees if such damages are in violation of any primary or secondary obligations (cardinal obligations).

11.3 As a rule Copacking is not liable for slight negligence unless such negligence pertains to an essential contractual cardinal obligation, in which the principal particularly trusts.

11.4 Copacking is excluded from liability for damages resulting from inadequate examination (as per Subparagraph 10.1 herein) previous to further processing.

12. Liability for colour and material deviations

21.1 Immaterial deviations from the original copy ascertained in colour print reproductions are not grounds for rejection. This remains effective for any comparison of test prints and batch prints. Immaterial deviations within a hologram imprint series are also excluded from rejection.

12.2 Copacking is not liable for naturally occurring material deviations whenever the principal has directed the implementation of such materials.

12.3 Inasmuch as Copacking has a third party carry out specialised processes or tasks the conditions stipulated under sub-clause 13.1 herein is correspondingly effective.

12.4 Copacking is solely liable for considerable deviations in the quality of the materials it procures (paper, plastics, pasteboards etc.) to the amount of its own accounts receivable against the material supplier. Copacking is released from liability when it transfers its claims against its supplier to the principal, unless claims against material suppliers etc. remain by way of Copacking’s own fault or such claims are assertible.

13. Data transfer

13.1 Any and all data entrusted to Copacking shall be backup copies.

13.2 The principal is solely responsible for the production, preparation and compiling of data as well for carrying out all correction procedures. For legal and technical reasons Copacking shall not interfere or intervene with the data stock supplied.

13.3 Copacking is neither liable nor responsible for defects or flaws resulting from a data stock that does not fulfil the necessary specifications.

14. Provision of materials

14.1 Materials procured by the principal shall be delivered franco domicile in perfect condition. Receipt shall be confirmed without guarantee for the correctness of quantities designated in the consignment note. The principal shall refund Copacking any costs incurred through payment or the examination of weight as well as storage charges for larger consignment lots.

14.2 The principal shall bear all risks involving the usability of the materials supplied. Copacking is entitled to reject materials as far as it finds such materials unsuitable for purpose of completing and fulfilling the sales contract.

14.3 Should the principal make media components available, Copacking shall not be made responsible or liable for any losses which are in conjunction with unavoidable waste loss as a part of the processing and the completion of orders. The principal shall take back any and all packaging materials.

14.4 In the event that the material provided by the principal is damaged or lost, Copacking shall not be made liable unless its legal representative, managing employee or other employees have acted either wilfully or grossly negligently.

15. Copyrights

15.1 The principal is solely responsible for reviewing rights of reproduction for all print and holographic copies. The principal is solely liable if rights and in particular copyrights of third parties are infringed through the execution of his order. With the placement of his order the principal exempts Copacking from all third party claims arising any such infringement of rights.

15.2 Copacking retains the copyrights and rights of reproduction to its own sketches, drafts, miscellaneous original copies, films as well as any similar objects in each and any procedure and for each and any purpose unless explicitly regulated otherwise.

16. Proof-reading, proofs

16.1 The principal shall examine all proofs, colour schemes and imprints with regard to the correctness of typesetting and miscellaneous mistakes and return them pronounced ready for printing to Copacking. The examination through the principal applies to the correctness and usability of computer-readable codes (e.g. bar-codes etc.) which are technically or in any other way linked to the product. Copacking shall not be made liable for errors overseen by the principal.

16.2 Copacking shall not be liable for delays resulting from late returns.

16.3 For smaller print contracts Copacking shall not be obliged to send its principal proofs or supply imprint copies. Should the principal not explicitly demand receipt of proofs, Copacking’s liability for typesetting errors is restricted to wilfulness and gross negligence.

17. Governing Law

17.1 The Order shall be governed by and in accordance with the laws of Germany or the United Kingdom.

18. Miscellaneous

18.1 No change amendment or modification (except with respect to change orders) shall be valid unless set forth in a written instrument signed by the party subject to enforcement of such amendment.

18.2 Copacking can refer to its company on the contracted products with the principal permission. The principal can only refuse to grant Copacking such permission if he can present predominant interests.

18.3 The legal relations between Copacking and the principal are solely subject to German law without recourse to UN purchasing rights.

19.Tooling

All tooling remaining in Seller possession will receive normal maintenance for the production of parts unless:

A tool has produced more than 500,000 parts per mould or cavity, or

A tool which has no production activity for more than one year.

In either event, it may be necessary to refurbish or rebuild the tool at Buyer’s expense before additional parts can be produced. If 18 months have passed without an order from the customer, tooling will be considered abandoned.