Terms and Conditions of Sale

of
Papierfabrik Palm GmbH & Co. KG 

1. Applicability
   All offers and deliveries of PAPIERFABRIK PALM GMBH & CO. KG (hereinafter referred to as „PAPIERFABRIK PALM“) are made exclusively on the basis of the following Terms and Conditions of Sale in their current version. These Terms and Conditions of Sale shall also apply for all future business conducted with the buyer. Any terms and conditions stipulated by the buyer, which deviate from these Terms and Conditions of Sale shall only be acceptable if they have been confirmed in writing by PAPIERFABRIK PALM as a supplement to these Terms and Conditions of Sale. This shall apply even if PAPIERFABRIK PALM executes delivery without reservation in knowledge of any deviating terms and conditions of the buyer.
   
   The “GENERAL TERMS AND CONDITIONS OF SALE (AVB) OF THE PAPER AND CARDBOARD MANUFACTURERS OF THE EC” pertaining to the European Association of the Cellulose, Paper and Cardboard Industry (CEPAC) form an integral part of these Terms and Conditions of Sale. The aforesaid AVB are modified and supplemented below with the consequence that the present Terms and Conditions of Sale have precedence over the aforesaid AVB.
   
   
2. Delay and Impossibility
   
   The following applies instead of Art. 6 a) of the AVB:
   
   
   1. Notwithstanding a withdrawal right on the part of the buyer in the event of defects (cf. 6. Warranty), the buyer shall, in the event of impossibility to perform or delay on the part of PAPIERFABRIK PALM, only be entitled to withdraw from the contract in the event of a breach of obligations attributable to PAPIERFABRIK PALM.
      
      
   2. In the event of delay, withdrawal or compensation instead of performances shall presuppose that the buyer has previously granted PAPIERFABRIK PALM a reasonable period of grace in writing equivalent to at least 4 weeks for carrying out the contractually due performances and has expressly stated at that point of time that he/it will withdraw from the contract in the event of non-compliance with the aforesaid period of grace and/or will enforce reimbursement of all costs incurred. At the end of the aforesaid period of grace, the buyer shall be obliged to state at the request of PAPIERFABRIK PALM whether he/it still insists on delivery or intends to enforce damage compensation or cost reimbursement claims in accordance with § 281, paragraph 4 of the German Civil Code (BGB) or whether he/it will withdraw from the contract.
      
      
   3. The period of grace referred to in 2 (b) of these Terms and Conditions of Sale shall only be dispensable if PAPIERFABRIK PALM seriously and conclusively refuses to carry out the contractually due performances or if there are special facts or circumstances which justify an immediate withdrawal from the contract after due consideration of the interests of both parties.
      
      
   4. The buyer may not withdraw from the contract before the performance due date, nor in the event of an insignificant breach of obligations by PAPIERFABRIK PALM. Finally, withdrawal from the contract shall be excluded if the buyer is solely or by far mainly responsible for the facts or circumstances which would justify his/its withdrawal from the contract, or if facts or circumstances occur during acceptance delay on the part of the buyer which are not attributable to PAPIERFABRIK PALM.
      
      
   5. Section (7) of these Terms and Conditions of Sale shall apply for damage compensation claims or cost reimbursement claims arising from delay or impossibility to perform.
      
      
3. Payment Arrears 
   In the event of payment arrears, PAPIERFABRIK PALM shall be entitled to charge default interest at a rate of 1 % per month. The aforesaid interest rate shall be increased or reduced if PAPIERFABRIK PALM is able to justify a higher interest rate or if the buyer is able to justify a lower charge by PAPIERFABRIK PALM. This shall not in any way prejudice the enforcement of additional default damages.
   
   
4. Reservation of Title
   As a supplement to Article 9 AVB, the buyer shall take all the necessary action on the strength of the law in force at the place of the buyer in order to make the reservation of title valid and permissible or to grant PAPIERFABRIK PALM a comparable security right.
   
   
5. Notification of Complaints
   
   The following applies instead of Article 10 a) AVB: 
   
   
   1. Legal or quality defects, the absence of qualities or the durability of goods possibly warranted by PAPIERFABRIK PALM and any overages, underages or incorrect deliveries shall be reported in writing without delay, namely,
      
      • in the event of visible deviations of the goods from the order with regard to their quality or quantity, no later than 5 working days after arrival of the goods at the buyer;
        
      • in the event of defects or irregularities which can be identified by a cursory inspection or simple check, before the commencement of processing but no later than 10 days after receipt of the goods at the place of consignment;
        
      • in the event of defects or irregularities which can only be identified after a detailed examination by means of a trial run or normal mechanical operations, no later than 12 months after receipt of the goods at the place of consignment.
        
        
   2. If a defect was notified on time, any further processing of the goods forming part of the complaint shall only be possible with the consent of PAPIERFABRIK PALM.
      
      
   3. If the defect was not notified on time, that part of the goods which has already been processed may not form part of a complaint. At least 90 % of the rejected goods must still be intact and clearly identifiable. The establishment of a defect in part of the goods cannot justify a complete rejection of the goods in question. A complaint referring to just part of the delivered goods shall not discharge the buyer from his/its obligation to pay the relevant amount for all the goods within the agreed credit terms and a complaint of the aforesaid nature cannot justify a return of all the goods in question.
      
      
6. Warranty
   
   The following applies instead of Article 10 b) AVB:
   
   
   1. In the event of a defect and upon due notification of the complaint in accordance with Section 5 of these Terms and Conditions of Sale, PAPIERFABRIK PALM shall undertake to rectify the defect or to make a replacement delivery at the option of PAPIERFABRIK PALM if the buyer is able to prove that the defect already existed upon the transfer of risk. The expiry period for all warranty claims shall be 12 months from acceptance of the goods. For damages attributable to impairment to life, body or health and which are caused by a defect attributable to PAPIERFABRIK PALM, the expiry period shall be 24 months from acceptance of the goods. Warranty obligations are excluded in respect of used goods.
      
      
   2. If PAPIERFABRIK PALM allows a reasonable period of grace set for its performance obligations to pass without response on its part, or if a one-off replacement delivery has been made and if the defect was not rectified as a result, and if PAPIERFABRIK PALM unjustifiably refuses to carry out the necessary rectification or replacement delivery, or if it delays rectification or a replacement delivery unduly or if the buyer cannot be reasonably expected to accept a rectification for any other reason and if the prerequisites of §§ 281, para. 2 and 323, para. 2 of the German Civil Code are met, the buyer shall be entitled to withdraw from the contract and to claim legally envisaged legal remedies of a price reduction instead of a rectification or replacement delivery as well as damage compensation or cost reimbursement, with the latter being within the scope of Section 7 of these Terms and Conditions of Sale.
      
      
   3. PAPIERFABRIK PALM shall, in other respects, not be obliged to rectify a defect or make a replacement delivery if this is only possible at a disproportionately high cost. Such costs shall be regarded as disproportionately high if they exceed 25 % of the purchase price of the delivered goods, whereby the value of the replacement delivery itself is not included. 
      
      
   4. If the goods were subsequently transferred to a different location from that of the buyer and if the relevant costs are increased as a result, especially transport, labour and material costs for rectification or a replacement delivery, the aforesaid increased costs shall be reimbursed by the buyer unless the transfer to another location is compatible with the envisaged use of the goods.
      
      
7. Damage Compensation
   
   
   1. Unless otherwise agreed in these Terms and Conditions of Sale, all claims of the buyer to damage compensation of any kind shall be excluded, including cost reimbursement claims and indirect damages. This shall apply in particular to claims for all breaches of obligations arising from the contractual relationship and any tortious acts. The aforesaid liability exclusion shall also apply if PAPIERFABRIK PALM engaged vicarious agents in the performance of its obligations.
      
      
   2. PAPIERFABRIK PALM shall nonetheless be liable in the cases referred to in Section 7 (a) of these Terms and Conditions of Business if PAPIERFABRIK PALM, the executive staff of PAPIERFABRIK PALM or vicarious agents of PAPIERFABRIK PALM are guilty of gross negligence or wilful intent and in all cases in which PAPIERFABRIK PALM, the executive staff of PAPIERFABRIK PALM or vicarious agents of PAPIERFABRIK PALM culpably breach major contractual obligations (cardinal obligations) and if the contract purpose is jeopardized as a result. PAPIERFABRIK PALM shall not be obliged to pay damage compensation instead of rendering performances in the event of insignificant breaches of obligations.
      
      
   3. In the event of a breach of major obligations, the liability of PAPIERFABRIK PALM shall, however, be limited to the order value in the case of slight negligence. 
      
      
   4. If the order value is not equivalent to the typically foreseeable damage in the last mentioned case, the liability of PAPIERFABRIK PALM shall at all events be limited to the amount of the typically foreseeable damage.
      
      
   5. Finally, the aforesaid liability exclusion shall not apply for claims under the German Product Liability Act (Produkthaftungsgesetz) or if PAPIERFABRIK PALM has assumed a warranty for the quality or durability of the goods or the purchasing risk. The liability exclusion shall also not apply for damages arising from impairment to life, body or health.
      
      
8. Quantity Tolerances
   
   The following applies as a supplement to Article 12 AVB:
   
   The quantity tolerances specified for paper in format shall be doubled for paper in rolls.
   
   
9. Legal Choice, Place of Performance and Legal Venue
   
   
   1. Deviating from Article 11 AVB, German law shall apply exclusively for the whole legal relationship between PAPIERFABRIK PALM and the buyer. The application of the Vienna UN Convention on Contracts for the International Sale of Goods dated April 11, 1980 is excluded.
      
      
   2. The place of performance for all mutual obligations, e.g. payments by the buyer and deliveries by PAPIERFABRIK PALM is the principal place of business of PAPIERFABRIK PALM in Aalen-Neukochen.
      
      
   3. The exclusive legal venue for all disputes in connection with our performances is Aalen if the buyer is a registered trader. The respective plaintiff shall also be entitled to bring legal action at the domicile of the respective defendant.