Conditions and Terms

GENERAL CONDITIONS AND TERMS FOR CONTRACT FOR WORKS
concluded in accordance with the provision under Section 536 et seq. Act 513/1991 Coll., Commercial Code, as amended

1. Application

The General Terms and Conditions (hereinafter referred to as VOP) of Signum spol. s r.o. apply to all business relations where SIGNUM spol. s r.o undertakes a hot zinc dipping-related job.

2. Protection Clause

Unless expressly agreed upon otherwise, the VOP of SIGNUM spol. s r.o. shall be applied exclusively. No other regulations, specifically the General Conditions of Trade, Sale or Delivery Conditions of the customer, are included in the contract even if SIGNUM spol. s r.o. did not expressly oppose such other regulations.

3. Other

SIGNUM spol. s r.o. undertakes to handle any personal data in accordance with the provisions of the relevant legal regulations. Should any provisions under the present VOP become ineffective, the lack of effectiveness shall have no effect whatsoever on the other provisions under the present VOP.

In accordance with the Law on Arbitration and Exercise of Arbitration Rulings no. 216/1994 Coll. as amended, the parties have agreed to settle any disputes arising from the contracts subject to the present VOP or in association therewith in arbitration before a sole arbitrator as indicated in the Rules of Arbitration Procedure issued by the Union for Arbitration and Mediatory Procedures of the Czech Republic, a.s., ID: 27166147 (hereinafter referred to as the "Union") and published at www.urmr.cz, it being understood that as of the date of delivery of the letter of action, the arbitrator must be included in the List of Arbitrators maintained by the Union and the contracting parties hereby expressly authorise the Union to appoint an arbitrator for the arbitration in accordance with the Rules of Arbitration Procedure, as foreseen by the present arbitration clause. The contracting parties hereby trust thus appointed arbitrator to settle all disputes to the principle of justice. The contracting parties expressly declare that before signing the arbitration contract, they have had the opportunity to become familiar with the Rules of Arbitration Procedure as well as with the Ruling on the Costs of the Arbitration Procedure, and have done so, and that they, as a result, consider the above documents to be an integral part of the present arbitration contract.

4. Subject of the Contract

The subject of the contact is the execution of surface treatment by means of hot zinc dipping of the material submitted by the Ordering Party as specified in the order for hot dipping. The hot dipping shall be carried out to ČSN EN ISO 1461.

5. Obligations of the Ordering Party and Contractor

The Ordering Party is obliged to provide the Contractor with information on ČSN EN ISO 1461. Furthermore, they undertake to co-operate as specified in the hop dipping of the material, to receive the as hot dipped material and pay the purchase price as specified hereunder.

The Ordering Party is obliged to hand the material over in such a condition as to allow application of the very process of hot dipping. That means that the material must in the first place not be contaminated by paint or any other impurities, it must not be extremely greasy, it must not be affected by deep corrosion, there must be no slag in the seams, and no inflow or venting holes and suspension holds as specified by the Contractor may be drilled or attached, respectively, to the material. By attaching their signature, the Ordering Party confirm that they have become familiar with the technical conditions of the hot dipping of the material they have supplied. The Contractor reserves the right to assess the state of the delivered material and decide, prior to the conclusion of any contract, whether the delivered material is eligible for hot dipping.

If the Ordering Party fails to submit the material in the state specified above, the Contractor shall be entitled to perform any modifications necessary to allow for the hot dipping process to take place.

The Ordering Party further undertakes to ensure that the chemical composition of the material intended for the hot dipping process complies with the conditions of eligibility of the material for the actual hot dipping. The Ordering Party confirms their familiarity with the effects of the steel's chemical composition on the zinc coat, namely the silicon, sulphur and phosphorous contents. If the contents of these elements are inappropriate as indicated in Annex 1 to the present VOP, the Contractor shall not be held accountable for any damage resulting from the lack of compliance with the chemical composition.

The Contractor declares they are familiar with all requirements for the quality of welded joints, it being understood that these must not contain any patches, pores or any other intolerable defects. Also, for welding purposes, they will use agents for cleaning welding tips or preventing the formation of splashes approved by the Contractor. Should welded joints contain such defects, the contractor shall not be held accountable for the quality of the hot dipped layer across such joints.

The Ordering Party agrees that hot dipping is an anticorrosion system where no decorative effect is guaranteed. The ČSN EN ISO 1461 Standard expressly specifies that the formation of white corrosion on the hot-dipped layer may not be deemed a reason for lodging a complaint. The occurrence of white corrosion is not associated with the quality of the as hot dipped layer.

The Ordering Party is obliged to provide information relating to the fact, if relevant, that a paint coat is to be applied to the as hot dipped product.

The Contractor is obliged to complete the hot dipping process by the deadline agreed upon. The Ordering Party shall be obliged to receive the material at the latest within 8 days of completion at the site where the hot dipping process took place or at another site the parties may have agreed upon. The Contractor may entrust the hot dipping process to a third party.
The material supplied to the Contractor with a notice of deposition (certificate), shall be furnished, following the hot zinc dipping, with a measurement report upon the Ordering Party's request. If the Ordering Party fails to provide a notice of deposition upon supplying the material, it shall be furnished with the measurement report subject to a special agreement only as long as it has been concluded between the two contracting parties.

The Contractor undertakes to carry out the hot zinc dipping process to the ČSN EN ISO 1461 standard only. The Contractor undertakes to consider all information provided by the Ordering Party as confidential and undertakes to refrain from providing the information to any third parties. Upon request, the Contractor agrees to provide any technical information necessary for the appropriate manufacture of products intended for hot zinc dipping. In the event of a loss or other degradation of the material supplied which will be attributable to the Contractor, the Contractor undertakes to compensate the Ordering Party for the damage caused by such damage of the material.

The Ordering Party undertakes to present to the Contractor in time, upon the former's request, the full transport and delivery conditions. The transport vehicles must be allowed free and safe positioning at the unloading sites and must be unloaded with no undue delay by the Ordering Party. If the Ordering Party fails to meet their obligations relating to the unloading, they shall be obliged to compensate the other party for any damage thus caused. The Ordering Party undertakes to provide any co-operation required in loading and depositing the objects, specifically to provide any automation means, including a trained crew. The manner of depositing and securing the goods across the load room surface on the transport vehicle falls within the responsibilities of the driver. Any co-operating staff shall be obliged to follow their instructions.

6. Price and Terms of Payment

The Price for hot zinc dipping as determined by the Contractor and given in the hot dipping order form shall be deemed to be in CZK unless specifically provided otherwise. For orders in other currencies, prices given in the contract apply. The weight of the as hot dipped material shall be invoiced at all times.

The prices are quoted excluding VAT, which will be added as per the legal rate.

The costs of transport, shipping, loading and packaging are not included in the given prices and are charged individually, unless agreed upon otherwise between the contracting parties.

SIGNUM spol. s r.o. reserves the right to correspondingly modify the prices if between the execution of the contract and delivery, the costs are reduced or increased, in particular as a result of a change in the prices of the feedstock. Upon request, SIGNUM spol. s r.o. shall present to the customer the factors crucial to the price modification and the specific increase thereof.

Unless provided otherwise, the purchase price shall be payable with no discounts or reductions at the moment SIGNUM spol. s r.o. informs the customer that they are ready to provide the relevant supply. Should the price not yet be determined or should it be impossible for any reason to communicate it to the customer, the purchase price shall be payable at the moment of receipt of the invoice. The legal effects in the event of a delay in the payment on the part of the customer shall be governed by the relevant legal regulations, namely, the relevant provisions of the Civil Code and Commercial Code, unless determined otherwise herein.

SIGNUM spol. s r.o. is entitled to charge a lump sum amounting to CZK 150 in the event of any single demand note or determination of an additional payment term.

If it becomes clear, following the execution of a contract, that the customer is threatened with over-indebtedness or if the customer displays a poor ability to comply with their obligations in the long run, SIGNUM spol. s r.o. shall be entitled to require a one-off collection of all, including the not yet due, receivables vis-a-vis the customer. If the customer is in delay in the payment of the purchase price, SIGNUM spol. s r.o. shall be entitled to rule, once an additional payment term of 2 weeks has lapsed in vain, that any other receivables vis-a-vis the customer thereby become due and SIGNUM spol. s r.o. is entitled to deny provision of the material to the customer until such time as the latter are able to comply with their obligation.

7. Completion Deadline

The hot dipping shall be completed by the deadline specified in the customer's order for hot dipping, within 30 days of submission of the material to the Contractor, unless determined otherwise. If the shipment of the goods is delayed due to reasons attributable to the customer by more than 1 month, SIGNUM spol. s r.o. shall be entitled to charge a storage fee amounting to 0.5% of the price of the subject of the delivery for each begun month, up to a maximum of 5 %.

8. Warranty for the Quality of the Work

The Contractor provides a 24-month warranty for the completed surface treatment as long as the Ordering Party has submitted a note on the deposition of the material. If the Ordering Party fails to provide the note, a warranty period of three months applies. The warranty period shall start to run upon receipt of the end part by the Ordering Party. The Contractor cannot be held accountable for any defects of the surface treatment as long as they have resulted from inappropriate handling, inappropriate use or storage at the Ordering Party's site. The Contractor shall further not be held accountable for any defects caused by defects in the parts submitted by the Ordering Party for processing, which they could not identify or which they communicated to the Ordering Party and provided that the Ordering Party insisted upon the execution of the contracted work despite the communication.

The Ordering Party acknowledges that they are aware of the risk of deformations and destruction of objects associated with the chemical process of hot zinc dipping. The Contractor shall not be held accountable for such deformations. A prior agreement in writing is required for any special requirements of the Ordering Party beyond the scope of the ČSN EN ISO 1461 standard.

The Ordering Party may lodge complaints with the Contractor related to quality and quantity provided that the material fails to comply with the conditions specified in the technical specification (order) of the Ordering Party or quality certificate, and/or the number of items does not correspond to the indication in the confirmed delivery note of the Ordering Party, by the following deadlines:

a) for apparent defects, within 15 days of the date of receipt of the goods.

b) for latent defects, within 24 months.

If the Ordering Party lodges a complaint against the goods after the deadlines indicated above, the entitlement to complain expires.

Communication of a complaint must be furnished in writing, and documentation to the effect of the justifiability of the complaint or a report written up in the presence of a representative of the Contractor and Ordering Party must be attached.

Failure to comply with the obligations above will cause the rights inherent in the emergence of the defects to expire.

If it is demonstrably proved that the complaint is justified and the Ordering Party fails to apply the right inherent in liability for defects, i.e. failing to identify whether:

a) they require removal of the defects by the provision of replacement goods or delivery of any missing quantities of the goods;

b) they require removal of the defects by a redress provided that the defects are redressable;

c) they require an adequate discount on the purchase price,

the method of removing the defects shall be left at the sole discretion of the Contractor.

9. Withdrawal from the Contract

In the event of a material breach of contractual obligations by one party, the other party shall be entitled to withdraw from the contract. The term material breach of obligations by the Contractor shall denote a failure to comply with the delivery term for the subject of the contract in excess of 14 calendar days as well as their failure to remove any defects justifiably noted by the Ordering Party within the same term. The term material breach of obligations by the Ordering Party shall denote their failure to pay the price for the subject hereof in excess of 14 calendar days. The withdrawing party shall be obliged to serve a note in writing with no undue delay to the other party that breached the obligation, to the effect that they are withdrawing from the contract, listing the reasons leading to such a withdrawal.

10. Other Provisions

Should such an event occur which will make it impossible, or partially impossible, for either or both of the parties to comply with their obligations hereto, they shall be obliged to inform one another of such events with no undue delay and take joint action to overcome the same. Failure to comply with the present obligation shall result in a claim for compensation of damages against the party faulty of breaching the present provision of the contract.

11. Effectiveness of the VOP

The present VOP shall come into effect on 20 October, 2008.The present VOP shall come into effect on 20 October, 2008.