GENERAL TERMS AND CONDITIONS OF PURCHASE – GOODS & SERVICES

  1. APPLICABILITY

1.1.   The following general terms and conditions of purchase (“GCP”) apply to all agreements concluded between ZELLAG AG, a company duly existing and incorporated in Switzerland, having its office in C/o Im Singeisenhof 9, 4125 Riehen, Switzerland (the “Buyer”) and its suppliers (the “Seller”), together with the Buyer, shall be jointly referred to as the “Parties” and each a “Party”).

1.2.   The Seller’s general conditions shall only apply insofar as the Buyer has expressly accepted the applicability thereof in writing. These GCP apply to the supply of goods ("Products") and/or the provision of services ("Services"), jointly referred to as "Deliverables."

1.3.   With the acceptance of a purchase order (the “Order”), the Seller agrees to accept the following terms and conditions.

 

  1. ORDERS

2.1.   The Buyer may issue Orders in writing, [by email or correspondence]. Unless otherwise agreed, the content of verbal agreements shall only be binding upon confirmation by the Buyer in writing.

2.2.   Orders will be considered accepted by the Seller upon receipt by the Buyer of an acceptance issued by the Seller in writing (the “Acceptance”).

2.3.   Each Order must be accepted by the Seller in writing promptly. If no Acceptance is received by the Buyer within [7] working days from the Seller’s receipt of an Order, it shall be deemed that the Seller refuses the Order, then the Buyer shall no longer be bound to the Order.

 

  1. DELIVERABLES

3.1.   The Seller shall supply the Buyer with the products and/or perform Services as described in the Order (the “Deliverables”), complying with this GCP and the requirements (the “Technical Specifications”) set forth in the Order including any of its attachments (if applicable). For Services, Seller shall employ qualified personnel, perform in a professional and workmanlike manner, and comply with all applicable laws and regulations.

 

  1. PAYMENT

4.1.   The Buyer shall pay for the Products and/or Services by bank transfer within the payment term specified in the relevant Purchase Order or, where applicable, in the corresponding contract between the Parties, provided that the Seller has properly issued a legal and valid VAT invoice for the total price of the Deliverables (“Price”) and has provided the Buyer with the documents related to the Deliverables and/or Services described in clause 4.2 of these GCP. Any particular conditions stipulated in the relevant Purchase Order or contract shall prevail.

4.2.   Within 7 working days upon the shipment of the Deliverables, the Seller shall provide the Buyer with the following documents:

a. the original copy of the invoice (as described in clause 4.1)

b. the original copy of the packing list

c. original copy of the Certificate of Analysis issued by the laboratory/formulator.

4.3.   Failure to provide any of the above documents entitles the Buyer to reject the entire shipment of the Deliverables.

 

  1. PACKING

5.1.   The Products shall be suitably packed by the Seller for complete protection during transport to the delivery place agreed by the Parties and in any event in accordance with the specifications stated in the Order.

5.2.   The Seller shall prepare 10 extra cartons for packing the Products and deliver them together with the Products.

5.3.   The Price includes all charges for packing (including the extra cartons required under clause 5.2), creating and marking for transportation of the Products to the delivery place, according to the specifications stated in the Order.

 

  1. DELIVERY AND RISK

6.1.   The Seller shall deliver the Products and/or Completed Services to the delivery place and on the delivery, date specified in the Order.

6.2.   Delivery terms and date, quantity and quality of the Deliverabless are of the essence in each Order.  Unless otherwise agreed, the delivery date specified in the Order is the time of delivery of the Deliverables at the delivery place. Any failure to meet the delivery date, quantity or any requirements to protect the quality of the Deliverables, such as the suitable packing and storage conditions, will constitute a breach of the Seller’s contractual obligations under the Order.

6.3.   If the Seller expects any delay to the delivery date, the Seller shall inform the Buyer of this immediately, but this will not exempt the Seller from its liability. While the delay lasts, subject to notification to the Seller, the Buyer is entitled to take any and all actions as it deems necessary, at the Seller’s cost, to ensure the Deliverables so affected will be delivered to its customer(s) as scheduled; specifically, the Seller shall reimburse and hold the Buyer harmless from any damages, penalty and other cost (a) incurred by the Buyer against its customers due to such delay of delivery; and (b) arising from the actions taken by the Buyer under this clause so as to ensure its on-time delivery to its customer(s).

6.4.   If force majeure events, such as war, flood, earthquake, blizzard or other natural disasters, such as acts of terrorism, take place, the affected Party shall inform the other Party within [15] days of the occurrence of the relevant event and influence on the performance of the Order. The other Party must reply or object in a timely manner. In these cases, neither Party shall bear any responsibility under relevant clauses hereof. However, such event shall not exempt the Parties from any obligations arising from any Deliverables already delivered.

6.5.   For the avoidance of doubt, the Seller shall be responsible for the risk, custody and storage of the Deliverables before their delivery at the delivery place.

 

  1. INSPECTION BEFORE THE DELIVERY OF THE PRODUCTS AND REJECTION

7.1.   The Seller will be the responsible of any change in the quality or any other characteristic of the Products purchased if such change has not been previously approved in written by the Buyer specifically, the Seller will be responsible of the incidences or damages caused to the Buyer’s customers due to such changes.

7.2.   All the Products are subject to (a) preliminary inspection and tests by the Buyer at the Seller’s factory or at the factory of the Seller’s suppliers and (b) final inspection and acceptance at Buyer’s factory or at the premise of the Buyer’s customers.

7.3.   Before the packing of the Products, the Seller shall analyse the Products and issue the corresponding Certificate of Analysis (“COA”), which should be enclosed with a chromatogram map and be sent to the Buyer. The packing of the Products shall always be subject to the approval of those certificates by the Buyer.

7.4.   Once the Products are ready to be shipped, the Seller shall inform the Buyer in order to proceed to the quality inspection of the Products.

7.5.   The Buyer or the inspector appointed by the Buyer will have to confirm the fulfilment of the Buyer’s instructions regarding the following: labels, brochures, packaging, bottle type, palletizing and Technical Specifications.

7.6.   The Buyer or the inspector appointed by the Buyer will choose a sample of every different item to be purchased and will send it to a laboratory for its testing. Meanwhile, the Seller will have to restock those samples, so that the delivery is complete again before the final shipping.

7.7.   The Products will be shipped upon the approval of the inspector, according to the results from the laboratory.

7.8.   The Buyer reserves the right to reject and hold, at the Seller’s expense and subject to the Seller’s disposal instructions, all Products not conforming to the Technical Specifications and/or samples provided by the Buyer. Specifically, the Buyer shall have the right to reject the Products and ask the Seller to replace them carrying with all the expenses in the following situations:

a. If the Products manufactured by the Seller have turned into extraordinary dangerous, risky or explosive substances due to its abnormal formulation or composition.

b. If the Products manufactured by the Seller cannot be used for the purposes required by the Buyer because of its faulty manipulation, composition or formulation.

7.9.   For the avoidance of doubt, neither the Buyer’s inspection nor failure to inspect, whenever before or after delivery of the Products, shall relieve the Seller from full responsibility for furnishing the Products conforming to the requirements of this GCP and the Order, nor prejudice any claim, right or privilege that the Buyer may have due to the defective or unsatisfactory Products.

  1. NON-CONFORMING DELIVERABLES

8.1.   Once the Products and/or Services have been delivered, in case that the Buyer’s customers face any problem related to the quality or the features of the Deliverables, the Buyer will hire an independent inspection company in order to verify the customer’s complaints.  If such investigation concludes that the Deliverables are non-conforming to the Technical Specifications (“non- conforming Deliverables”), the Seller will take charge of the Deliverables, pay the fees of the inspection company and compensate the Buyer for all losses in accordance with clause 8.2.

8.2.   The compensation to the Buyer will include but not be limited to, the total price of the order, the delivery expenses and the amount to be paid to the final client as compensation. If needed, the Seller will also have to take charge of the cost of the destruction of the non-conforming Deliverables. The Buyer will previously provide to the Seller the documents that prove all those costs.

8.3.   In case the Seller supplies Deliverables that are not conforming to the Technical Specifications, in addition to the covenants stated in clauses 7, 8.1. and 8.2., the Buyer will also be entitled to: (a) take all the necessary actions to repair all the defects of the Deliverables and/or bring the Deliverables into conformity with any applicable requirements, in which event all costs and expenses thereby incurred by the Buyer, including material and handling charges to be determined and assessed by the Buyer, shall be on the Seller’s account, (b) withhold total or partial payment and/or (c) require the Seller to repair or replace the said Deliverables.

8.4.   For any repairs or replacements, the Seller shall perform any tests requested by the Buyer in order to verify the fulfilment of this GCP and the Order. Cost for tests shall be borne by the Seller.

 

  1. REPRESENTATIONS AND WARRANTIES

9.1.   The Seller declares and warrants:

a. the Deliverables fully comply with all the Technical Specifications set forth in the Order.

b. the Price of the Deliverables is not higher than the price currently applied to any other customer of the Seller for the same or similar Deliverables in similar quantities.

c. the Deliverables have been manufactured in accordance with the laws of the country of manufacture in force.

d. the Deliverables are merchantable.

e. the Deliverables are free from defects in materials and workmanship.

f. the Deliverables are suitable for their intended or reasonably expected use by the Buyer.

9.2.   The decision of the Buyer to place the Order is due to the existence, truth, accuracy and completeness of the representations and warranties. The foregoing warranties shall apply for a period of twenty-four (24) months after the delivery date specified in the Order and shall survive the Buyer’s inspection, acceptance and use of the Deliverables.

 

  1. INDUSTRIAL AND INTELLECTUAL PROPERTY RIGHTS

10.1. The Seller does not and shall not acquire, as a result of this GCP or the Order, any rights over the trademarks, “know-how”, business secrets, trade names, information, documentation, designs, drawings, materials or any other industrial or intellectual property rights used or developed by the Buyer in relation to the Deliverables.

10.2. The right of use of all intellectual and industrial property rights over the Deliverables pertain and shall forever pertain to the Buyer.

 

  1. INDEMNITY

11.1. The Seller shall indemnify and hold the Buyer harmless for any damage the Buyer may suffer as a consequence of any breach by the Seller of this GCP, the Order and/or applicable law. Damages will include all expenses and losses, including loss of profits, court/arbitration costs and attorney’s fees which the Buyer may incur in connection with (a) any breach by the Seller of this GCP and/or the Order and (b) any third parties’ right that has been harmed under the above-mentioned circumstances. The Seller shall maintain adequate insurance consistent with industry standards to cover its obligations under the foregoing indemnity.

 

  1. CHANGES

12.1. Following the Seller’s acceptance of the Order, the Buyer may at any time make changes in any one or more of the following aspects: (a) method of shipment or packing; (b) place and date of delivery; (c) quality requirements or (d) quantity. The Seller should be informed [thirty (30) days] in advance of such changes.

12.2. If any change as set forth in clause 12.1. causes an increase or decrease in the cost of, or the time required for the performance of the Order, the Buyer and the Seller will agree in writing to an equitable adjustment to the Price and/or delivery schedule of the Deliverables.

12.3. Any Seller claim for adjustment under this clause will be deemed waived unless asserted in writing within thirty (30) days from the Seller’s receipt of the change notification and may only include reasonable direct costs that will necessarily be incurred as a direct result of the change.

 

  1. SUSPENSION

13.1. The Buyer may at any time, by notice to the Seller [issued ten (10) days in advance], suspend performance of the work required under the Order for such time as it deems appropriate. Upon receiving notice of suspension, the Seller shall promptly suspend work to the extent specified, properly caring for and protecting all work in progress and materials, supplies, and equipment the Seller has on hand for performance.

 

  1. TERMINATION

14.1. The Order may be terminated by the Buyer, without any need to give prior notice:

a. In the event of total or partial non-performance, or any breach of any of the Seller’s obligations pursuant to this GCP or the Order.

b. In the event that the Seller has gone into bankruptcy.

 

  1. ASSIGNMENT AND SUBCONTRACTING

15.1. The Seller shall not have the right to assign the rights and obligations arising under this GCP or the Order without the prior written consent of the Buyer.

 

 

  1. CONFIDENTIALITY

16.1. The Seller shall not (a) advertise or make public the fact that the Buyer has agreed to purchase the Deliverables, (b) disclose information relating to this GCP or the Order, or (c) use the name of the Buyer or any of the Buyer’s customers in any way.

 

  1. GOVERNING LAW, DISPUTE RESOLUTION AND JURISDICTION

17.1 This GCP shall be governed by and construed in accordance with the laws of Switzerland.  Any dispute, controversy, issue or claim arising out of or relating to the existence, validity, performance or interpretation of these Purchase Conditions, directly or indirectly, shall be finally resolved by arbitration administered by the Swiss Arbitration Centre in accordance with its Rules and Statutes in force on the date the Notice of Arbitration is submitted. The Swiss Arbitration Centre shall administer the arbitration and appoint the arbitrator. The Parties undertake to comply with the arbitral award and any other decisions rendered therein.

17.2 The arbitral tribunal shall consist of a sole arbitrator, and the language of the arbitration shall be English. The seat of arbitration shall be Basel, Switzerland.  Furthermore, should judicial enforcement of the arbitral award become necessary due to either Party’s failure to comply voluntarily, the Parties expressly submit to the courts having jurisdiction over the city of Basel, Switzerland, expressly waiving any other jurisdiction to which they may otherwise be entitled.

 

  1. MISCELLANEOUS

18.1. Either Party’s failure to enforce any provision under this GCP or the Order shall not be construed as a waiver of a Party’s right thereafter to enforce each and every such provision.

18.2. The invalidity, in whole or in part, of any clause or part thereof of this GCP shall not affect the remainder of such clause or this GCP. All provisions or obligations contained in this GCP which by their nature or effect are required or intended to be observed or performed after termination or expiration of the Order will survive and remain binding upon and for the benefit of the Parties.

18.3. In case of any conflict between the provisions under the Order and those under this GCP, the provisions under the Order shall prevail.

18.4. This GCP and the Order may be written in English or other language. In case of any discrepancy, the English version shall prevail.