thyssenkrupp terms and conditions of purchase client code doc. id-code pe-pc-atc-0001 uan ee01533...

Plant Client Code Doc. ID-Code

PE-PC-ATC-0001 UAN

EE01533

thyssenkrupp Uhde Chlorine

Engineers (Japan) Ltd.

Terms and Conditions of Purchase Rev 01 of 29

CONTENT

1 CONDITIONS OF PURCHASE ORDER 3 2 SCOPE OF WORK 4 3 RIGHT TO CHANGE THE WORK / DEVIATIONS / INCONSISTENCIES 4 4 QUALITY ASSURANCE 6 5 QUALITY AUDITS 6 6 QUALITY SURVEILLANCE (QS) 7 7 PROGRESS SCHEDULING AND CONTROL 7 8 TESTS AND INSPECTIONS 8 9 SHIPPING INSTRUCTIONS 10 10 DELIVERY TIME/PENALTIES 11 11 DRAWINGS AND DOCUMENTS 12 12 ACCEPTANCE 12 13 WARRANTY/GUARANTEE 14 14 DOCUMENTATION FOR THIRD PARTY SUPPLIES 16 15 ITEMS PLACED AT SUPPLIER'S DISPOSAL 16 16 OWNERSHIP AND RISK 17 17 TERMINATION AND SUSPENSION 18 18 FORCE MAJEURE 21 19 CONFIDENTIALITY 22 20 STORAGE 23 21 EXPORT PERMIT 24 22 INTELLECTUAL PROPERTY RIGHTS, INDEMNIFICATION 25 23 INSURANCE 26 24 RIGHT OF RETENTION/INDEMNIFICATION 27 25 CODE OF CONDUCT 27 26 APPLICABLE LAW AND PLACE OF JURISDICTION 28 27 MISCELLANEOUS 29

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Plant Client Code Doc. ID-Code UAN

PE-PC-ATC-0001 EE01533

thyssenkruppUhde Chlorine


Terms and Conditions of PurchaseRev 01 of 29

DEFINITIONS

CONTRACTOR shall mean thyssenkrupp Chlorine Engineers (Japan) Ltd., 7F, Sakura Nihombashi Bldg., 13-12, Nihombashi Kayabacho 1-Chome, Chuo-Ku, Tokyo 103-0025, Japan

• SUPPLIER shall mean the persons, companies or corporations named as such in the PURCHASE ORDER or their successors or permitted assignees, being liable for any obligations arising out of the PURCHASE ORDER.

• SUB-SUPPLIERS or SUB-CONTRACTORS shall mean a third party who has entered into a subcontract with the SUPPLIER. Any requirements, obligations etc. imposed by the PURCHASE ORDER on the SUPPLIER in respect of SUB-SUPPLIERS or SUB-CONTRACTORS shall also apply in respect of any sub-SUB-CONTRACTOR, sub-sub-SUB-CONTRACTOR etc. as if the sub-SUB-CONTRACTOR, sub-sub-SUB-CONTRACTOR etc. was a genuine SUB-SUPPLIER or SUB-CONTRACTOR. Any condition applicable to the SUPPLIER is also applicable to any SUB-SUPPLIER or SUB-CONTRACTOR assigned by the SUPPLIER to perform the WORK or part of it.

• CONTRACT shall mean the main contract between OWNER and CONTRACTOR.

• PURCHASE ORDER or SUBCONTRACT shall mean the present PURCHASE ORDER entered into between the CONTRACTOR and the SUPPLIER with all attachments.

• SUPPLIES shall mean the scope of supply to be delivered by the SUPPLIER as set forth in the PURCHASE ORDER documents.

• WORK shall mean all supplies and services to be performed by the SUPPLIER as set forth in the PURCHASE ORDER documents.

• OWNER shall mean the CONTRACTOR’s customer

• PLANT shall mean the OWNER’s Plant or Facility in which the WORK will be implemented.

• ACCEPTANCE shall mean acceptance of the WORK by the CONTRACTOR as provided for under Article 12.

• SITE shall mean the operation site where the PLANT is located.






1 Conditions of PURCHASE ORDER

1.1 Any provision of SUPPLIER’s documents that conflict with the terms and conditions of the PURCHASE ORDER shall be null and void. SUPPLIER's general terms and conditions shall not be applicable to the PURCHASE ORDER, nor shall any current or later reference to SUPPLIER's general terms and conditions have any effect on the PURCHASE ORDER, unless explicitly agreed otherwise in writing between the CONTRACTOR and SUPPLIER (correctively referred to as “PARTIES”). The execution of the PURCHASE ORDER by SUPPLIER implies his acceptance of CONTRACTOR’s Additional Terms and Conditions of Purchase and SUPPLIER's renunciation of his own sales conditions, notwithstanding any present or future confirmation to the contrary.

1.2 The following attachments will form an integral part of the PURCHASE ORDER:

1.) The signed purchase order text (face of PURCHASE ORDER) together with the documents incorporated therein by reference or attached thereto, including enclosures as per items 2.) to 4.) hereinafter

2.) Commercial and/or technical minutes of meeting of understanding agreed to and signed between PARTIES before the effective date of PURCHASE ORDER, if any

3.) These Terms and Conditions of Purchase 4.) Technical Specifications

The above listed PURCHASE ORDER documents shall apply in the order as they are enumerated.

Additional documents shall only form part of the PURCHASE ORDER if indicated accordingly in the signed PURCHASE ORDER Document:

5.) “Acknowledgement of Order” or “Confirmation of Receipt” form 6.) Specimen "Statement to Export Permit" 7.) Quality Certificate 8.) Shipping Instructions 9.) Export Packing 10.) Packing Instructions for Switchgears and Cabinets for non-seaworthy packing 11.) Packing for Piping and Piping Bulk 12.) Packing Instructions 13.) Material Status Report 14.) Fabrication Schedule 15.) Specimen for Guarantees for Advance and Progress Payment 16.) Specimen for Guarantees for Advance Payment of Warranty Instalments 17.) Inquiry and Order Specification for Spare Parts for 2-Years Operation 18.) Vendor Documentations 19.) Project Specifications and Forms 20.) Assignment Conditions for Specialists 21.) Construction Site Regulations 22.) General Conditions for Civil Works and Erection 23.) Call off procedure for LV-motors

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It is assumed that all documents referred to in the purchase order document and/or in the Purchaser's inquiry are in the possession of SUPPLIER. If not, it is SUPPLIER’s responsibility to contact CONTRACTOR in order to obtain the relevant copies.

2 Scope of WORK

2.1 Scope

All component parts specified in the PURCHASE ORDER or which are required according to normal commercial custom and practice to achieve the purpose of the PURCHASE ORDER, are part of the scope of the WORK to be provided by the SUPPLIER, although they may not be expressly mentioned in the PURCHASE ORDER.

Part of the SUPPLIER’s WORK is the duty to adapt and complete the documentation to be supplied, or which may already have been supplied, with respect to any changes and/or additions to the WORK which may arise during the execution of the PURCHASE ORDER.

All of the SUPPLIER’s WORK, including all respective parts and work therefor, is compensated by the prices agreed within the PURCHASE ORDER, unless otherwise explicitly established in the PURCHASE ORDER.

2.2 Subcontracting and Assignment

Any performance of the WORK or any part thereof by third parties or any assignment of the PURCHASE ORDER or any part thereof is only permitted with CONTRACTOR’s prior written consent.

3 Right to change the WORK / Deviations / Inconsistencies

3.1 The CONTRACTOR has the right to order such variations to the WORK which in its opinions are desirable.

Changes may include an increase or decrease in quantity, quality, character, kind or performance of the WORK or any part thereof, as well as changes to the subcontract schedule.

If the CONTRACTOR requires an estimate prior to ordering change work or orders change WORK, then the SUPPLIER shall submit a written estimate of the price and any impact upon the schedule/delivery within five (5) working days free of charge. Change order estimates shall be expressly identified as such.

A change to the WORK caused by circumstances for which the SUPPLIER is responsible shall not entail any changes to the PURCHASE ORDER price or PURCHASE ORDER schedule in favour of the SUPPLIER, including those of SUBCONTRACT.

The SUPPLIER shall not be obliged to comply with oral request provided by the CONTRACTOR for changes in the WORK. If the SUPPLIER believes that any written notice or instruction received from CONTRACTOR will generate a change in the cost, time to perform or integrity of or guarantees for the WORK, the SUPPLIER shall give






CONTRACTOR a written notice, requiring that a written change order shall be issued specifying the change noticed or instructed as well as the corresponding adjustment to the PURCHASE ORDER price and/or PURCHASE ORDER schedule. If the SUPPLIER performs work without approved change order by CONTRACTOR´s procurement department on unconfirmed oral request or fails to give such notice within five (5) working days after CONTRACTOR’s instruction, SUPPLIER loses its right to consider the work as a change and it will be deemed to be part of the WORK.

3.2 In case the SUPPLIER requires an extension of the delivery time and/or an increase of the PURCHASE ORER value in connection with a change to the WORK, SUPPLIER must substantiate all time and/or cost impact in respect to such change to the WORK within the specified period of time as stated in Article 3.1. CONTRACTOR may require the SUPPLIER to undertake special measures to avoid that the change order has an effect on the SUBCONTRACT schedule.

3.3 All terms and conditions of the PURCHASE ORDER also apply to change orders, unless otherwise agreed.

3.4 The SUPPLIER shall in no case deviate from the specifications laid down in the PURCHASE ORDER, nor deviate in any other sense from the PURCHASE ORDER, unless SUPPLIER has obtained an authorisation in writing from the CONTRACTOR.

3.5 On receipt by SUPPLIER of a written change order to the WORK, SUPPLIER shall implement it promptly even if the effects of such written change order on the SUBCONTRACT price, the SUBCONTRACT schedule or other provisions of the SUBCONTRACT have not yet been established (or are in dispute). Approval by CONTRACTOR of drawings, samples or other proposals shall not imply approval of deviations unless explicit confirmation is given in writing.

3.6 Where the designation "or equivalent” or "or superior" is used in the PURCHASE ORDER, any material proposed as equivalent by the SUPPLIER will require approval by the CONTRACTOR in writing.

3.7 The SUPPLIER is obliged to check the CONTRACTOR’s technical specification especially with regard to errors, inconsistencies, design, deficiencies and material, and to notify CONTRACTOR thereof. Any deviation must be agreed upon with CONTRACTOR in writing.

3.8 The SUPPLIER has the responsibility for ensuring the completeness, the discovery of mistakes and inconsistencies of the provisions of the PURCHASE ORDER necessary for the fulfilment of the WORK.

3.9 After PURCHASE ORDER placement, the SUPPLIER must not appeal against incomplete, missing or inconsistent provisions such as but not limited to planning documents or other conditions.

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4 Quality Assurance

4.1 Quality System

SUPPLIER shall have established and implemented a Quality System which shall comply with the quality management system requirements of ISO 9001 or equivalent quality standard relevant for the WORK. SUPPLIER’s Quality System and procedures shall be subject to CONTRACTOR’s and OWNER´s review upon specific request.

4.2 Quality Plan

SUPPLIER shall establish and implement a Quality Plan in accordance with the PURCHASE ORDER. The Quality Plan shall be submitted to CONTRACTOR for review within thirty (30) calendar days after date of PURCHASE ORDER.

SUPPLIER shall keep CONTRACTOR currently informed of any change in the Quality Plan during the PURCHASE ORDER period.

SUPPLIER shall implement SUB-SUPPLIERS Quality Plan for major components in an overall Quality Plan. SUPPLIER shall plan and carry out Quality Surveillance (QS) of its SUB-SUPPLIERS. The scope and level of details in SUPPLIER's QS activity shall be dependent on the type of product, and where appropriate on records of SUB-SUPPLIER’s previously demonstrated capability and performance.

5 Quality Audits

The CONTRACTOR will plan and carry out quality audits in SUPPLIER’s organisation. The scope and frequency of the audits shall be adequate to confirm that the quality activities and results comply with the quality system and the planned arrangements. The CONTRACTOR shall give the SUPPLIER a minimum of five (5) working days notice prior to performing quality audits at the SUPPLIER’s and SUB-SUPPLIER's premises. The SUPPLIER shall provide the required facilities and assistance with respect to the execution of such audits. SUPPLIER shall ensure that the CONTRACTOR is entitled to audit all SUB-SUPPLIERS involved in any part of the WORK.

CONTRACTOR, OWNER and third parties authorised by the OWNER shall have the right, at any time, to undertake quality audits on the SUPPLIER’s performance of the WORK as well as of their quality systems and furthermore to verify the application of the SUPPLIER’s quality plan.

Results of the audits will be noted in an audit report.

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6 Quality Surveillance (QS)

The CONTRACTOR will plan and carry out Quality Surveillance (QS) of the SUPPLIER at a level of details sufficient to ensure the fulfilment of the quality requirements of the WORK. QS involves all types of activities starting from quality control (review) of engineering documentation and ending with checking the Final Documentation. The OWNER shall have the right to participate in such QS activities.

7 Progress Scheduling and Control

7.1 Progress of WORK

The SUPPLIER shall ensure adequate progress control from the date of the PURCHASE ORDER until the WORK is completed. The CONTRACTOR shall be informed about the actual status of the WORK once every calendar month. The first issue of the reports/data file shall be submitted within four (4) calendar weeks from the date of the PURCHASE ORDER or two (2) calendar weeks from submission of the notice/data file by the CONTRACTOR to proceed, at the latest.

7.2 Status Report

On request by the CONTRACTOR, progress dates from the SUPPLIER based on - Vendor Documentations - Purchasing/Material - Fabrication - Final Inspection and Shipping Dates

shall be delivered by the SUPPLIER to CONTRACTOR in a form designated or approved by CONTRACTOR.

7.3 Fabrication Schedules

The SUPPLIER shall prepare fabrication schedules per manufacturing location according to CONTRACTOR's standard “Fabrication Schedule” in accordance with the attached specimen. If required by CONTRACTOR the SUPPLIER shall also request its SUB-SUPPLIERS to furnish fabrication schedules if SUPPLIER purchases items fabricated by third parties.

The fabrication schedules must show the dates for preparation and quality control of drawings and documentation as well as for procuring material required for fabrication and also all interim and final inspections, i.e. in accordance with the welding and testing schedule and/or Inspection Data Sheet (IDS).

The fabrication schedule has to be submitted to the CONTRACTOR at the end of each calendar month complete with an updated progress chart.

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7.4 Expediting Visits

The SUPPLIER shall ensure that representatives of both CONTRACTOR and OWNER shall, subject to due announcement by CONTRACTOR, be given access to the SUPPLIER’s and its SUB-SUPPLIERS facilities at all times.

The following updated documentation shall be presented at every expediting visit:

- Fabrication Schedule - Status update - Material Status Report

Costs arising from repeated visits which become necessary due to incomplete/ improper documentation/files by the SUPPLIER or due to delays in delivery and progress schedule/performance of the WORK caused by the SUPPLIER will be borne by the SUPPLIER.

7.5 Delays / Obstacles in Progress

The SUPPLIER is obliged to inform the CONTRACTOR immediately if, during the fabrication of the WORK, problems arise or delays can be expected in the planned fabrication schedule or if any other form of difficulty arises. The SUPPLIER must then agree to approved expediting measures on the account of SUPPLIER to overcome these difficulties with the CONTRACTOR.

In the event that parts and documents to be provided by the CONTRACTOR do not reach the SUPPLIER on schedule, the SUPPLIER shall be obliged to inform the CONTRACTOR immediately and to take further steps in co-operation with the CONTRACTOR as necessary. If SUPPLIER fails to give such notice within five (5) working days, the SUPPLIER loses its right to postpone the delivery dates.

8 Tests and Inspections

8.1 General

The SUPPLIER shall ensure that representatives of CONTRACTOR, OWNER and/or third parties shall, subject to due announcement by CONTRACTOR, be given access to the SUPPLIER’s and its SUB-SUPPLIERS facilities at all times in order to perform tests and inspections or to have these performed by third parties.

Unless specified otherwise and accepted by CONTRACTOR in the PURCHASE ORDER, the place of tests and/or inspections shall be the SUPPLIER's manufacturing premises.

Any testing equipment, auxiliaries and consumables required for testing and/or inspecting, including personnel, shall be provided by the SUPPLIER free of charge. The SUPPLIER shall conduct a continuous program of Manufacturing Quality Control based on the Quality Plan for all WORK to be performed. The Quality Plan shall be subject to approval of CONTRACTOR and/or OWNER and must be updated and signed during each fabrication step.

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CONTRACTOR and OWNER reserve the right to perform during all stages of fabrication quality audits to ensure that all quality requirements are strictly adhered to. The quality audits or failure to carry out the quality audits shall in no way relieve the SUPPLIER of his responsibilities for any defective material or workmanship.

8.2 Invitation to Tests and Inspections

Invitations shall be sent by the SUPPLIER to the CONTRACTOR.

Unless otherwise agreed, the CONTRACTOR shall be invited in writing to the tests and inspections fifteen (15) working days before the agreed date.

The date of the test/inspection shall be confirmed by the SUPPLIER in writing or by fax at least five (5) working days in advance.

If for reasons not attributable to the CONTRACTOR, the notified WORK is not ready for tests and/or intermediate/final inspections on the date specified, or does not correspond to the PURCHASE ORDER, or if the documentation required in the PURCHASE ORDER is not available, incomplete and/or improper, the CONTRACTOR shall be entitled to charge the SUPPLIER with all costs incurred by the CONTRACTOR for the repetition of any inspection.

8.3 Test/ Inspection Documentation

The following documents shall be presented to the CONTRACTOR at the time of inspection:

the complete inspection documentation in accordance with the state of Inspection Test Plan/Inspection Data Sheet and for final inspection one set of the Final Documentation in accordance with the Technical Specification and the documents list,

• the final dimensional sheets or latest revision of the workshop drawings shall be provided with the stamp(s) approved for fabrication by the CONTRACTOR and/or official inspection body,

• all Non Conformance Reports (NCR) and the related approval note by the CONTRACTOR.

8.4 Scope of Tests/Inspections

The scope of tests/inspections is shown in the Technical Specifications, CONTRACTOR's Inspection Data Sheets (IDS) and/or technical PURCHASE ORDER enclosures. In any case the requirements of the applicable Design and Construction Code have to be regarded.

Major points to be regarded, whether included or not in the PURCHASE ORDER enclosures, but not limited to them, are

• post award pre-inspection meetings with the SUPPLIER on its premises or where requested by the CONTRACTOR,

• check of QC system and the quality plans of the SUPPLIER, • verification that QC procedures are applied, • monitoring tests and transfer of material identification,






• approval certificate for all major repair WORK to be issued before realisation, especially in case of welding,

• review/collection of all QC documentation in the form of equipment code data books.

If it is doubtful in the reasonable opinion of the CONTRACTOR whether the quality of the item to be supplied corresponds to the contractual requirements, the scope of inspection may be extended. The resulting costs shall be borne by the SUPPLIER.

If deficiencies are found during inspections in the fabrication shop, they have to be rectified immediately by the SUPPLIER and shall be made available for re-inspection immediately.

All costs associated with these re-inspections and any further inspection work will be borne by the SUPPLIER.

The SUPPLIER’s obligations under the PURCHASE ORDER to comply with the agreed time schedule are not affected by any actions undertaken by the CONTRACTOR in accordance with this Article 8.

ACCEPTANCE of the SUPPLIER’s WORK will be carried out according to the provisions outlined in Article 12.

CONTRACTOR’s inspection or approval does not relieve the SUPPLIER of its responsibility and liability for completing the WORK accurately and in accordance with the requirements of the PURCHASE ORDER.

The CONTRACTOR reserves the right to inspect the packing on the SUPPLIER's premises by CONTRACTOR’s own personnel and/or an authorised delegate.

In case an inspection by the CONTRACTOR has been finished with reservations only due to outstanding WORK, the SUPPLIER has to confirm the completion of outstanding WORK in writing.

Only upon this written confirmation, the CONTRACTOR will release the relevant goods for shipment.

The SUPPLIER is explicitly not entitled to release any WORK, or part of it, for shipment without prior written approval of the CONTRACTOR. If SUPPLIER disregards this provision the CONTRACTOR reserves the right to require from the SUPPLIER to order back this WORK or part of it to the workshop. All related costs are on the account of the SUPPLIER.

9 Shipping Instructions

The PURCHASE ORDER will be handled with CONTRACTOR´s “Loose-Parts-System" as per the Shipping Instructions.

The Shipping Instructions will be transmitted to the SUPPLIER in due time prior to the delivery date. These shipping instructions must be observed in all respects.

The SUPPLIER shall furnish the CONTRACTOR with transport drawings as per the






Shipping Instructions for all equipment (or part thereof) exceeding the following dimensions and/or weight in packed condition:

Gross weight (total cargo + container weight) 20 metric tons and/or dimensions larger than 1200 x 240 x 240 cm.

For further details reference is made to the PURCHASE ORDER.

10 Delivery Time/Penalties

10.1 All agreed SUPPLIER’s performance shall be in strict conformance with the delivery dates or other time provisions specified in the PURCHASE ORDER.

It is agreed that the documentation as specified in the PURCHASE ORDER is part of the delivery of the supplies and services.

The delivery date for documentation is deemed to be fulfilled if the documentation has been received at the address as per the PURCHASE ORDER.

The SUPPLIER grants the CONTRACTOR the right wholly or partially to extend the delivery dates of the WORK up to three (3) calendar months without price changes and to receive the corresponding payments later.

10.2 If penalties have been agreed the CONTRACTOR reserves the right to claim them until ACCEPTANCE.

The SUPPLIER is not subject to penalties for a delay which is solely attributable to the CONTRACTOR or the OWNER unless the SUPPLIER has not complied with Articles 3.1, 7 and 8.

Time is of the essence. If the SUPPLIER is unable, for reasons not attributable to the CONTRACTOR, to meet the agreed performance, delivery dates or any other time provisions, CONTRACTOR may cancel the PURCHASE ORDER or any part thereof, and hold SUPPLIER liable for any costs or damages incurred. The CONTRACTOR has the right – in addition to CONTRACTOR’s penalty claims - to demand payment from the SUPPLIER of the actual costs incurred by the CONTRACTOR to adhere to and/or accelerate the delivery date and/or the shipment to SITE. This shall – without being limited thereto – include CONTRACTOR´s costs for additional expediting/inspections.

The CONTRACTOR reserves the right to deduct from unsettled payments the amount of the applicable penalty and/or costs incurred by the CONTRACTOR under this article.

10.3 Regardless of the provision stipulated in Article 10.2, in case of late delivery, CONTRACTOR shall be entitled to have the SUPPLIER expedite the delivery and claim for costs against the SUPPLIER without prejudice to its other rights and remedies under the PURCHASE ORDER, law or otherwise. CONTRACTOR’s rights against such delay shall include but not limited to costs of transportation of delayed deliverables by air, dead freight and demurrage charge and/or any other costs to eliminate further delay in the delivery regardless of the original delivery terms specified in the PURCHASE ORDER.

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11 Drawings and Documents

11.1 The SUPPLIER shall furnish the necessary certificates as evidence that the WORK performed conforms with the latest applicable edition of the codes and standards indicated in the Technical, and with laws and regulations of all authorities having jurisdiction for the WORK and with all statutory requirements.

11.2 The CONTRACTOR’s review or approval does not relieve the SUPPLIER of its responsibility and liability for completing the WORK accurately and in accordance with the requirements of the Technical Specification, drawings and all other documents of the PURCHASE ORDER.

11.3 The SUPPLIER shall make sure at all times that the drawings, procedures and specifications used by him are duly reviewed and stamped by CONTRACTOR and include the latest revision issued. Any WORK performed by the SUPPLIER prior to receipt of the proper drawings, procedures and specifications shall be at his risk.

11.4 Preparation and handling of all drawings and documents shall be done in accordance with the related Technical Specification and the procedure as per CONTRACTOR’s document “Vendors Documentation”.

11.5 The SUPPLIER confirms, that its erection manual is sufficient for an experienced erection contractor in order to install SUPPLIER’s equipment.

11.6 Preparation and handling of all drawings and documents shall be done in accordance with the Technical Specification.

11.7 The SUPPLIER has to make sure that all documents show CONTRACTOR’s PURCHASE ORDER and item numbers.

12 ACCEPTANCE

12.1 ACCEPTANCE of the WORK by the CONTRACTOR will not take place with the inspection in SUPPLIER's workshop, but on SITE after commissioning, upon completion of a successful performance test of the PLANT, after which the OWNER will issue the "Preliminary Acceptance Certificate" to the CONTRACTOR.

12.2 Commissioning of the PLANT requires the complete and proper execution of the erection of the WORK as well as the pre-commissioning test (i.e. mechanical test runs, pressure test, tightness test, adjustment and checking of the control circuits, flushing sequences, etc.). The minimum test requirements as set forth in the Technical Specifications shall be met.

12.3 Demonstration of the performance guarantees as well as ACCEPTANCE of the WORK, will be deemed to have been effected, if, for reasons not attributable to the SUPPLIER and the SUB-SUPPLIERS, the demonstration of the performance guarantees is not carried out within forty eight (48) calendar months after the proper supply of the last supplied items including the documentation. This requires that up to this point in time no deficiencies have been claimed by the CONTRACTOR in respect to the WORK.

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12.4 The SUPPLIER is obliged to provide complete and unequivocal evidence of the fulfilment of all operating data for the WORK as established and guaranteed in the PURCHASE ORDER.

12.5 This evidence of fulfilment of the operating data will be provided within a continuous period of seventy two (72) hours of an uninterrupted performance test run on SITE, in which the performance guarantees shall be verified unless otherwise specified in the Technical Specification. The performance test will be carried out under design load by the OWNER under CONTRACTOR´s supervision as soon as the PLANT is ready for the performance test.

12.6 In the case that a tolerance of performance and measurements for any part of the WORK has been agreed, this tolerance shall be the maximum tolerance acceptable to the CONTRACTOR. In any case tolerances of the measuring devices shall not be taken into account unless explicitly consented to by the CONTRACTOR in writing.

12.7 The SUPPLIER shall promptly rectify any deficiencies in SUPPLIER’s scope of WORK during a performance test run. If the SUPPLIER refuses, if the SUPPLIER has tried once unsuccessfully or if the SUPPLIER has not succeeded within a period of time as reasonably determined by the CONTRACTOR after corresponding request by the CONTRACTOR to completely and properly rectify any existing deficiencies by itself or

to have these activities performed by a third party at the cost and risk of the SUPPLIER. The CONTRACTOR will then arrange for another performance test at the cost and risk of the SUPPLIER, and if this should be unsuccessful, the CONTRACTOR is entitled to :

a) Immediately cancel the PURCHASE ORDER in total or partly, and/or; b) Demand damages due to non-fulfillment of the PURCHASE ORDER, and/or; c) Reduce the overall price of the PURCHASE ORDER according to the reduced

value of the WORK, which will be reasonably determined by the CONTRACTOR.

12.8 If, prior to ACCEPTANCE, the CONTRACTOR determines that any design, equipment, materials or workmanship, furnished by the SUPPLIER or its SUBCONTRACTORS is defective or any part of their performance under the PURCHASE ORDER is deficient, the CONTRACTOR may require the SUPPLIER to promptly remedy said defect or deficiency or - if the SUPPLIER does not propose a reasonable repair within three (3) working days after getting the formal complaint, or fails to remedy such defect or deficiency within a reasonable period of time - have remedied said defect by a third party at the SUPPLIER’s cost and risk and/or suspend or terminate the part of WORK affected by said defect or deficiency and any other part of the WORK.

If the SUPPLIER is required to remedy defective design, equipment, materials, or workmanship, any resulting cost shall be for SUPPLIER´s account and no change of the PURCHASE ORDER shall be allowed.






13 Warranty/Guarantee

13.1 The SUPPLIER hereby warrants and guarantees that all the materials supplied in accordance with this PURCHASE ORDER shall:

(1) Conform to the PURCHASE ORDER and Technical Specifications referred therein and applicable laws relating to the materials;

(2) Be fit and sufficient for the purposes for which they are intended as per the performance requirements and criteria as set forth in the Technical Specifications and;

(3) Be of new and good materials and free from defects.

13.2 In the same way the SUPPLIER warrants that the WORK complies with the latest state of the art in its design and fabrication and complies with all applicable laws, including those of the country of SITE, regulations and authority approvals at the time of ACCEPTANCE and that any material is new, unused and conforms in all respects with the standards and codes as specified in the PURCHASE ORDER.

13.3 The warranty period shall end twenty four (24) calendar months after ACCEPTANCE. If ACCEPTANCE is delayed for reasons not attributable to SUPPLIER and its SUBCONTRACTORS, then at the latest forty eight (48) calendar months after the delivery of the last supplied items and the complete documentation, ACCEPTANCE will be deemed to have taken place. This requires that up to this point in time no deficiencies have been claimed by CONTRACTOR in respect to the WORK.

13.4 The SUPPLIER shall at its sole cost and risk rectify any and all WORK which is not in accordance with the warranties as per Articles 13.1 and 13.2 without undue delay after CONTRACTOR’s notice, however at a time convenient to CONTRACTOR and OWNER, either on SITE or – if not possible and subject to CONTRACTOR’s prior written approval- at SUPPLIER’s workshop, taking and performing all measures including any transport, air freight if necessary, any disassembly and re-erection necessary for the rectification of such deficiencies.

13.5 The provisions in this Article 13 are correspondingly valid for deficiencies, shortcomings and/or defects in or damage to the WORK as a result of SUPPLIER’s inadequate documentation.

13.6 A warranty claim will be deemed to be correctly raised if the defect has occurred within the warranty period and if it has been made by the CONTRACTOR without undue delay, however within six (6) calendar months after the expiry of the warranty period (postmark) at the latest.

13.7 The CONTRACTOR will have the final and exclusive decision on the choice of rectification of deficiencies and/or defects either by replacement or repair of the defective parts, through correction, amendment, or by reproduction of the SUPPLIER’s respective documentation.

13.8 Before rectifying deficiencies and/or defects, the SUPPLIER shall provide the CONTRACTOR - within three (3) working days after notification of deficiencies and/or defects - with all the information enabling CONTRACTOR to sufficiently assess the cause of deficiencies and/or defects and measures suitable for their rectification. The SUPPLIER is not entitled to request an immediate shut down of the PLANT to carry out

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the necessary rectification.

13.9 Defective parts which have been replaced will be made available to the SUPPLIER on SITE, or at its request, will be sent to SUPPLIER at his cost and risk, in so far as re-exportation is feasible.

13.10 For repaired and / or modified and/ or replaced equipment, SUPPLIER´s warranty remains valid for a period of twenty four (24) calendar months from the date of finalisation of the remedy of the defect. It will expire not later than forty eight (48) calendar months after proper supply of the last supplied items including documentation of the PURCHASE ORDER.

13.11 The CONTRACTOR has the right to rectify deficiencies and/or defects within the meaning of Articles 13.1, 13.2 and 13.5 - at the cost and risk of the SUPPLIER - or to have them rectified by a third party or by the OWNER, if (a) the SUPPLIER does not rectify the respective WORK as described in article 13.4, or (b) if the SUPPLIER refuses to carry out the rectification or declines to do so in the required way, or (c) if the SUPPLIER fails to start rectification as described in Article 13.4 within five (5) working days after CONTRACTOR’s defect notice or (d) in case of urgencies and emergencies, or(e) if rectification has been attempted once by the SUPPLIER without success. All such rectifications of deficiencies shall be made at the sole cost and risk of the SUPPLIER. Additional costs related to a resulting delay in progress of erection on SITE – like costs of personnel or crane - shall be borne by the SUPPLIER, if applicable.

13.12 The CONTRACTOR has the same right as per Article 13.11, if immediate rectification is required to maintain the proper, safe or reliable operation of the PLANT.

13.13 The SUPPLIER will also exchange, free of charge, any spare parts which have already been delivered and which are no longer usable due to the changes and/or additions according to Articles 13.1 and 13.2.

13.14 In case of any doubt with regard to claimed damage, the SUPPLIER has to provide sufficient details to enable a third party judgement.

13.15 Should the SUPPLIER’s technician or engineer be needed for investigation or rectification purposes, this person shall be on SITE within three (3) calendar days.

13.16 Without undue delay after finalisation of any investigations on claimed damage, the SUPPLIER is obliged to submit a root cause analysis report.

13.17 In case that the SUPPLIER in addition to the above warranty provides the CONTRACTOR with guarantees or performance guarantees of any sort, the CONTRACTOR shall be entitled to rely on these guarantees and the SUPPLIER`s liability for these guarantees shall, notwithstanding anything contrary in the PURCHASE ORDER, not be restricted or excluded.

13.18 CONTRACTOR shall be entitled without consent of SUPPLIER to assign any and/or all rights and claims it may have against SUPPLIER resulting from this Article 13 to OWNER.






14 Documentation for Third Party Supplies

14.1 Where the SUPPLIER is, in accordance with the PURCHASE ORDER, responsible for the preparation and supply of the documentation for equipment to be fabricated and/or procured by the CONTRACTOR or OWNER elsewhere, the SUPPLIER shall reimburse to the CONTRACTOR all costs incurring for modification and changes, repairs and/or replacements of such equipment, provided such are attributable to errors or omissions in the documentation furnished by the SUPPLIER.

14.2 The SUPPLIER shall furthermore correct the corresponding defective or deficient or incomplete documentation at his own expense and shall submit the agreed-upon number of sets of such documentation to the CONTRACTOR.

15 Items placed at SUPPLIER’s Disposal

15.1 If it has been agreed between the SUPPLIER and the CONTRACTOR that the PURCHASE ORDER covers CONTRACTOR’s items placed at SUPPLIER’s disposal, which the SUPPLIER then combines, assembles or processes together with its own supplies and services, the SUPPLIER will inspect these items immediately upon receipt and inform the CONTRACTOR without delay of any deficiencies.

15.2 If the SUPPLIER omits to inform the CONTRACTOR in writing of obvious defects within ten (10) calendar days after receiving the items placed at its disposal, the SUPPLIER will be liable for any consequences arising for CONTRACTOR due to the defective parts.

The SUPPLIER is obliged to ensure the careful storage and protection of such items placed at SUPPLIER’s disposal from receipt thereof until the risk for the supplies and services is transferred to the CONTRACTOR. The SUPPLIER is obliged to identify the items as CONTRACTOR´s property, to mark them accordingly and keep them separate from the SUPPLIER’s other goods.

From the date of receipt of such parts at the SUPPLIER´s workshop until delivery and receipt by the CONTRACTOR, the SUPPLIER also bears the risk of loss and damage thereto.






16 Ownership and Risk

16.1 Documents

16.1.1 All CONTRACTOR’s drawings, designs, ideas, specifications, and other information, which accompany and constitute the PURCHASE ORDER belong to CONTRACTOR and, on request, shall be returned after use. The contents of these documents may not be used, reproduced, lent out, or divulged for any other purpose than agreed upon in writing.

16.1.2 Title to and property in the documentation (analysis, drawings, documents, data-media, operating manuals etc.) to be provided and prepared by SUPPLIER in accordance with the PURCHASE ORDER shall pass to CONTRACTOR as to the time of its completion.

16.2 The title to and the property in SUPPLIES shall pass from SUPPLIER to CONTRACTOR at the earlier of:

a) The materials being identifiable as being produced for the purpose of incorporation in the PLANT, whether completed or in the process of construction; or

b) The SUPPLIER receiving payment in respect of such materials; or c) Loading for transportation at SUPPLIER´s and/or SUB-SUPPLIER´s workshop; or d) The materials being unconditionally appropriated to the PURCHASE ORDER.

Any of the transfer provisions mentioned above has to be in accordance with the relevant law and the SUPPLIER shall, prior to placement of the PURCHASE ORDER, inform the CONTRACTOR in the event that either of the transfer provisions is not in accordance with the relevant law.

16.3 In the event that the title to and the property in the SUPPLIES passes to the CONTRACTOR prior to the actual delivery, the SUPPLIER undertakes to possess the manufactured SUPPLIES or goods as a direct possessor of CONTRACTOR. CONTRACTOR and SUPPLIER agree that SUPPLIER shall store the manufactured SUPPLIES or goods separately from other goods free of charge to CONTRACTOR. The SUPPLIER shall ensure appropriate storage of the manufactured goods and clearly mark them as property of CONTRACTOR by means of stickers, tags, labels or the like; and shall take all such measures which are necessary according to the applicable law to protect the property of CONTRACTOR against any third party rights.

The SUPPLIER shall take out at its own expense an insurance in favour of CONTRACTOR on customary terms and conditions against any loss or type of damage (irrespective of the causes) of the manufactured goods and will prove the issuance of an insurance on demand of CONTRACTOR at any time as well as maintain or repair the goods if needed. CONTRACTOR is entitled to terminate the period of storage on SUPPLIER's premises at any time and request the immediate surrender of the goods in custody.

16.4 For the purpose of effectuating the transfer of ownership to CONTRACTOR as described in Article 16, CONTRACTOR and SUPPLIER agree that the manufacture of the goods or SUPPLIES is always effected by and on behalf of CONTRACTOR.






16.5 At all times the WORK covered by the PURCHASE ORDER to which the CONTRACTOR holds the title in accordance with this Art. 17, shall be free of liens/encumbrances and from any third-party rights other than those for which the CONTRACTOR is responsible. The SUPPLIER shall inform CONTRACTOR immediately if the goods in question are seized on behalf of a third party or are likely to become subject to other restraints on disposal or legal measures. The SUPPLIER shall indemnify the CONTRACTOR from and against all costs arising out of SUPPLIER´s failure to comply with the provisions of this Art. 16.

16.6 Risk of loss and damage to the WORK shall pass on the CONTRACTOR in accordance with the agreed INCOTERMS as per PURCHASE ORDER.

17 Termination and Suspension

17.1 The CONTRACTOR may terminate upon his own discretion this PURCHASE ORDER or any part thereof by written notice to the SUPPLIER, if the SUPPLIER is in a substantial breach of contract and has not remedied such substantial breach after receipt of a ten (10) calendar days’ notice to comply with the PURCHASE ORDER, or if any of the following events occurs:

- if the SUPPLIER is adjudged bankrupt, - if SUPPLIER files a petition in bankruptcy, - if the SUPPLIER makes a general assignment for the benefit of his creditors, - if the SUPPLIER enters into deterioration of assets, - if a receiver, administrator or trustee is appointed on account of SUPPLIER’s insolvency, - if any other analogues or comparable act or event occurs, - if the SUPPLIER disregards laws or ordinances, - if the SUPPLIER, at any time, refuses or fails to carry out or complete the WORK with promptness or diligence, - if the SUPPLIER fails to make prompt payment of any due amounts to any SUB- SUPPLIER or vendor, - if the SUPPLIER continually or repeatedly violates any provision of this PURCHASE ORDER,

In the event of termination, the CONTRACTOR may enter upon the premises of the SUPPLIER and, for the purpose of completing the WORK, take possession of all data, documents, equipment, supplies and temporary construction facilities thereon and may finish the WORK by whatever method the CONTRACTOR may deem expedient, including the hiring of others under such terms as he may deem advisable.

In such case, the SUPPLIER shall not be entitled to receive any further payment until the completion of the WORK. Upon completion of the WORK the CONTRACTOR will determine the total cost incurred in completing the WORK, including additional overhead, legal and other costs incurred by CONTRACTOR. If the cost of completing the unfinished WORK exceeds the amount due to the SUPPLIER, then the SUPPLIER shall pay such excess cost to the CONTRACTOR as a debt due from the SUPPLIER.

The CONTRACTOR reserves the right to claim damages and seek any other relief from the SUPPLIER, in addition to such excess cost.

The SUPPLIER shall provide the CONTRACTOR with a list of its SUB-SUPPLIERS and shall on CONTRACTOR’s request, immediately assign to CONTRACTOR or






OWNER, as advised by CONTRACTOR all respective subcontracts entered into by the SUPPLIER with SUB-SUPPLIERS for the WORK. SUPPLIER will include a corresponding provision into the contracts with the SUB-SUPPLIERS to ensure the SUB-SUPPLIER´s approval to such an assignment.

17.2 The CONTRACTOR may, without cause at CONTRACTOR’s discretion, terminate this PURCHASE ORDER in whole or in part at any time by written notice to the SUPPLIER. Such termination shall be effective in the manner specified in said notice and shall be without prejudice to any claim which the CONTRACTOR may have against the SUPPLIER. On receipt of such notice, the SUPPLIER shall, except as directed otherwise, immediately discontinue the WORK and the placing of orders for materials, facilities and supplies in connection with the performance of the WORK and shall, if requested, make every reasonable effort to procure the termination/cancellation of existing orders and subcontracts on terms satisfactory to the CONTRACTOR. Thereafter, the SUPPLIER shall do only such WORK as may be necessary to preserve and protect the WORK already in progress, to protect the material, equipment or supplies on SITE or in transit thereto, and to dispose of any property as requested by the CONTRACTOR.

17.3 The CONTRACTOR may, upon termination of the CONTRACT by the OWNER or if the OWNER files for bankruptcy or becomes insolvent, terminate the PURCHASE ORDER. In such case the SUPPLIER shall be entitled to be reimbursed for the reasonable and documented direct cost incurred by the SUPPLIER in performing the WORKS until termination.

17.5 The SUPPLIER is obliged to hand over all documents completed, usable and properly compiled to the CONTRACTOR.

17.6 Upon termination of the PURCHASE ORDER pursuant to Article 1.1 above, a complete settlement of all claims of the SUPPLIER shall be made as follows:

a) The CONTRACTOR shall assume the costs for that part of the WORK, properly performed until termination, including direct and proven costs that were reasonably necessary as a result of the termination of the existing PURCHASE ORDER or for the protection or disposition of CONTRACTOR´s property and which have not been compensated in prior payments.

b) The aforesaid costs are the SUPPLIER´s sole and exclusive compensation for termination pursuant to Article 1.1.

c) The ownership for that part of the WORK, properly performed until termination will be transferred to the CONTRACTOR.

d) Within sixty (60) calendar days of the date of termination, the SUPPLIER shall submit his final invoice for the amount due under this Article 17.6 and the CONTRACTOR shall not be liable for any damages or losses, including - without limitation - loss of anticipated profit.






e) The CONTRACTOR shall be entitled to deduct from the amount calculated under this Article 17.6 any amount which he would otherwise be entitled to deduct from any other payments.

17.7 Upon termination of the CONTRACT, CONTRACTOR shall be entitled to assign to the OWNER or its nominee, to the extent desired by the OWNER, all or any rights and/or obligations under the PURCHASE ORDER – including the entire PURCHASE ORDER without consent of SUPPLIER. In such event SUPPLIER agrees to enter into any legal arrangement effectuating such assignment. Upon the assignment of the respective obligation under the PURCHASE ORDER, CONTRACTOR shall be relieved from that obligation towards SUPPLIER or otherwise arising out of or in connection with this PURCHASE ORDER.

17.8 The CONTRACTOR may temporarily suspend the performance of the WORK or parts thereof by giving notice to the SUPPLIER. Such notice shall specify which part of the WORK shall be suspended, the effective date of the suspension and the expected date of resumption of the WORK. Furthermore, the CONTRACTOR shall state any support functions which the SUPPLIER shall maintain while the WORK is suspended. The SUPPLIER shall promptly resume the WORK after notification by the CONTRACTOR.

17.9 The CONTRACTOR shall compensate the SUPPLIER for all direct necessary and proven expenses reasonable incurred by the SUPPLIER as a result of the suspension as per Article 17.8, unless the suspension is attributable to SUPPLIER, provided that the SUPPLIER does everything reasonably necessary and possible to mitigate the effects thereof.

In case SUPPLIER and CONTRACTOR should not reach a mutual agreement related to the increase in costs for the remaining WORK, the CONTRACTOR is entitled to terminate the PURCHASE ORDER. In this case, the SUPPLIER’s claim is limited to the proven direct costs which SUPPLIER reasonably incurred for the WORK properly performed up to the suspension.

In the event of a suspension, the SUPPLIER shall, as soon as practicable, put all WORK including drawings, reports and documents in both electronic and paper form, into an orderly condition and take all necessary steps to ensure that all WORK including drawings, reports and documents are protected during the suspension.

If the suspension leads to a delay or if the SUPPLIER claims that it does, then a request for extension of time must be made by the SUPPLIER in accordance with Article 3.2.






18 Force Majeure

18.1 “Force Majeure” means the effective occurrence of any unusual act or event which is beyond the reasonable control of the affected party, and renders the affected party unable to comply in whole or in part with its obligations under the PURCHASE ORDER.

18.2 Subject to compliance with the previous paragraph, Force Majeure includes ‘Acts of God’ (including epidemic, tidal wave, lightning, earthquake, hurricane, exceptionally adverse weather conditions), hostilities or acts of war (whether declared or not), civil or military disturbances, acts of terrorism, armed conflicts, bombs, sabotage, riots (other than among employees of the SUPPLIER), boycotts, national, regional or professional strikes (excluding strikes, lock-outs and other industrial disputes or actions by, between or originated among employees of the SUPPLIER and his SUB-SUPPLIERS) and acts of any government or public authority or any representative thereof, whether or not legally valid. Force Majeure does not include events such as insolvency of any party.

18.3 The affected party must promptly notify the other party of the occurrence of an event of Force Majeure, giving details of its occurrence. If the SUPPLIER fails to inform, in writing, the CONTRACTOR within ten (10) calendar days, or if the SUPPLIER has already exceeded the contractually agreed performance dates by more than two (2) calendar weeks, the SUPPLIER has no right to claim an extension of the time schedule. The affected party shall give prompt notice once the end of the Force Majeure event is foreseeable. Each party shall do everything reasonably possible to minimise the effects of such Force Majeure. Each party shall separately bear the financial consequences of such Force Majeure.

18.4 The burden of proving the existence of Force Majeure and the consequences of the Force Majeure is upon the affected party.

18.5 The obligations affected by the Force Majeure event shall be suspended forthwith and the time for the performance of such obligations shall be extended for a period of the Force Majeure event. If the SUPPLIER’s supplies and services are prevented for continuous period of one-hundred fifty (150) calendar days or three-hundred (300) calendar days in the aggregate, either party may terminate the PURCHASE ORDER forthwith by giving the other party a written notice to that effect. In such case the SUPPLIER shall be entitled to be reimbursed for the reasonable and documented direct cost incurred by the SUPPLIER in performing the WORKS until the event of Force Majeure occurs.

18.6 Nothing herein shall alter any obligation with respect to portions of the contractual obligations not affected by Force Majeure

18.7 The occurrence of Force Majeure shall not entitle the SUPPLIER to any financial compensation whatsoever.

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19 CONFIDENTIALITY

19.1 All plans, drawings and specifications, and any other information or data, which is made available or disclosed to SUPPLIER, directly or indirectly, by or on behalf of CONTRACTOR in connection with the PURCHASE ORDER or that may be learned, derived or obtained by SUPPLIER during any discussions for or any performance of the WORK shall be held in confidence and not disclosed by the SUPPLIER to any third party and shall not be used by him for any purpose other than for the performance of the WORK or as authorised in writing by the CONTRACTOR. All such information furnished by the CONTRACTOR to the SUPPLIER shall remain the property of the CONTRACTOR, and, upon completion of the WORK, the SUPPLIER shall, if requested by the CONTRACTOR, either destroy or return to the CONTRACTOR all such information including any copies thereof.

On written request of the CONTRACTOR such destruction shall be certified in writing by an authorized employee of the SUPPLIER.

19.2 The SUPPLIER shall not make news, releases or issue other advertisements pertaining to the PURCHASE ORDER without obtaining the prior written approval of the CONTRACTOR.

19.3 The taking of photographs of the PLANT or in industrial areas is forbidden unless previously expressly authorised in writing by the CONTRACTOR.

19.4 The SUPPLIER shall be entitled to disclose the information as per Article 19.1 only to its own employees, SUB-SUPPLIERS and their employees provided they need to know the information for performance of the WORK and, prior to such disclosure, are bound on term and conditions not less stringent than those accepted by SUPPLIER hereunder. The SUPPLIER's personnel have strictly to follow the rules given by the CONTRACTOR's site management. Any consequences out of failing are on the SUPPLIER's account.

19.5 Article 19 shall not apply to information which;

a) has been of public knowledge on the date of disclosure thereof by the CONTRACTOR; or

b) was lawfully known to the SUPPLIER prior to the disclosure thereof by the CONTRACTOR without confidentiality obligation; or

c) becomes, through no fault of the SUPPLIER, his employees, representatives or agents generally available to the public; or

d) is lawfully made available to the SUPPLIER by a third party who disclosed such information to the SUPPLIER on a non-confidential basis without violating of any obligation of confidentiality relating to the disclosed information; or

e) was independently developed, at any time, by employees of the SUPPLIER who have not had access to information obtained from the CONTRACTOR.

provided the SUPPLIER can prove the facts constituting the exemption.

19.6 Article 19 shall apply analogously to any information obtained by the SUPPLIER directly or indirectly from the OWNER in connection with the PURCHASE ORDER.






19.7 At the CONTRACTOR´s or OWNER’s request, the SUPPLIER shall enter into a separate confidentiality agreement with the CONTRACTOR or OWNER.

19.8 The secrecy obligations shall elapse 20 years after effective date of the PURCHASE ORDER and survive any termination or expiration of the PURCHASE ORDER.

20 Storage

The SUPPLIER will store the WORK at its own cost and risk from the date at which it is ready for dispatch until it is called off by the CONTRACTOR, however latest up to six (6) calendar months after notice of readiness for dispatch. One (1) calendar month after the notice of readiness for dispatch, the SUPPLIER shall submit an offer for the cost of further storage. The CONTRACTOR reserves the right to select whether the equipment will be stored based on SUPPLIER´s offer or whether the equipment shall be delivered on the agreed delivery terms.






21 Export Permit

21.1 In the case of WORK, for which a permit for export to the country of destination to be designated by the CONTRACTOR is required from the competent authorities, the SUPPLIER shall be required to apply for and obtain such permit. A copy of such permit shall be sent to the CONTRACTOR as a matter of course immediately on being obtained.

If no export permit is necessary, the SUPPLIER will provide the CONTRACTOR with other documents proving an export permit is not required.

21.2 In the case of WORK, for which a permit for re-importation into the country of destination to be designated by the CONTRACTOR is required from the competent US authorities in accordance with the export control regulations of the United States of America, the SUPPLIER shall be required to apply for and obtain such a permit. A copy of the permit shall be sent to the CONTRACTOR as a matter of course immediately on being obtained.

21.3 In the case of WORK, for which a permit for export to Japan is required, the SUPPLIER shall immediately inform the CONTRACTOR about this requirement. If in such case the SUPPLIER was granted permit for an earlier export, the SUPPLIER will provide the CONTRACTOR with a copy thereof and provide the CONTRACTOR promptly with all information which might be necessary for the application.

21.4 In the event that the above permits should either not be granted or withdrawn, the CONTRACTOR has the right to cancel the PURCHASE ORDER entirely without further obligation.

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22 Intellectual Property Rights, Indemnification

22.1 The SUPPLIER hereby irrevocably grants to CONTRACTOR and OWNER a non-exclusive, perpetual, transferable license, with the right to grant sublicenses, to use all drawings, documents, software including its documentation, engineering and other data prepared or furnished by the SUPPLIER in performing the WORK and the WORK itself for the intended purposes of the PURCHASE ORDER. This also includes a duplication right of CONTRACTOR and OWNER.

22.2 SUPPLIER represents and warrants to CONTRACTOR and OWNER that the SUPPLIER is the owner of all right, title and interest in any data described in Article 22.1 above and/or is in possession of valid and existing licenses to the same which allow for SUPPLIER to grant the license described in Article 22.1 above.

22.3 The SUPPLIER shall indemnify and hold harmless CONTRACTOR and OWNER against any and all liability, loss, damage, legal costs, legal fees or expense by reason of any claim, action or litigation in respect of any alleged or actual infringement or misappropriation of any patent, copyright or trademark or any other intellectual property rights, foreign or domestic, resulting from the use or resale of the WORK or from the breach of the representation or warranty given in Article 22.2 above.






23 Insurance

SUPPLIER at its own cost and without cost for the CONTRACTOR shall provide and maintain:

• Third Party Liability insurance including Extended Products Liability Coverage, covering the whole warranty period as per PURCHASE ORDER

• Transportation/Marine insurance subject to international standard terms and conditions in accordance with the delivery terms of the PURCHASE ORDER.

• Employer’s Liability insurance in accordance with the applicable laws

• Insurance for SUPPLIER ´s working and other equipment to be brought to the SITE

• Personnel insurance including but not limited to Workman’s Compensation in accordance with the applicable laws covering losses in connection with illness, personal injury or accidental death among SUPPLIER ´s and its subcontractor’s employees performing work anywhere in the world.

• If applicable, Automobile liability insurance covering owned, non-owned and hired motor vehicles used in connection with the WORKS as per the applicable laws but with a minimum with limit of at least one million EUR (EUR 1,000,000.-) or equivalent for personal injury or death and property damage resulting from each occurrence.

• Any other insurance which is legally required.

All SUPPLIER ´s insurance shall - unless otherwise stated above - be effective from the start of the WORKS and shall not expire before the end of the guarantee/warranty period.

All insurance policies shall – to the maximum extent permitted by law – state, that the insurers waive all rights of subrogation against CONTRACTOR and the COMPANY and their employees.

SUPPLIER shall ensure that all insurance policies contain a clause requiring the insurer to notify the CONTRACTOR within sixty (60) calendar days in advance before the insurance is materially changed or cancelled or ceases for any other reason.

SUPPLIER shall provide certified copies of the insurance policies or insurance certificates relating to all insurance mentioned above.

Taking out of any insurance under this Article 24 shall not relieve SUPPLIER of any of its obligations under this PURCHASE ORDER or at common law or pursuant to any statute, rule, regulation, or other enactment.

If SUPPLIER subcontracts the WORK or any part thereof in compliance with this PURCHASE ORDER, the SUPPLIER warrants that its SUBCONTRACTORS fully comply with the insurance requirements under this Article 23.2.

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If the insurances contemplated and required under the above article 23.2 are not effected or maintained by SUPPLIER, the CONTRACTOR or the OWNER may either effect such insurances and recover the cost of effecting insurance from SUPPLIER or terminate the PURCHASE ORDER.

24 Right of Retention/Indemnification

The CONTRACTOR has the right of retention of due payments if a material breach of contract of the PURCHASE ORDER by the SUPPLIER causes a risk for the CONTRACTOR to pay, including but not limited to, penalties or other costs to OWNER. The retention may not exceed the amount which CONTRACTOR is in the risk of paying under the CONTRACT to OWNER due to SUPPLIER’s material breach of contract.

SUPPLIER shall indemnify, defend and hold harmless CONTRACTOR from and against any and all losses, liabilities, claims or demands whatsoever (including without limitation, all costs, expenses and reasonable attorney’s fees), arising out of any bodily injury or death or property damages caused by SUPPLIER’s negligence or wilful misconduct.

SUPPLIER shall indemnify and hold harmless CONTRACTOR from any damage, cost or expense claimed by any third party for damage caused by the negligence or wilful misconduct of SUPPLIER in connection with the performance of the PURCHASE ORDER.

SUPPLIER represents that in connection with the performance of this PURCHASE ORDER, it shall comply with all applicable laws, regulations, ordinances etc. and shall indemnify and hold harmless CONTRACTOR from any damage, cost or expense incurred by any of them in connection with a breach of such representation.

25 Code of Conduct

CONTRACTOR´s business activities are governed by a set of commitments, values and ethics which are expressed in the ThyssenKrupp Code of Conduct. Similarly we expect from our business partners including but not limited to suppliers to share the commitments, values and ethics expressed in the ThyssenKrupp Code of Conduct. The ThyssenKrupp Group of Companies has taken the chance to express the governing commitments, values and ethics applicable to its suppliers in the ThyssenKrupp Supplier Code of Conduct (“TKSCOC”) which can be found under https://www.thyssenkrupp.com/en/company/procurement/for-suppliers/purchase-downloads.html#201275

SUPPLIER represents and covenants that it shall at all time during and/or in connection with the term of this PURCHASE ORDER comply with the TKSCOC and the commitments, values and ethics expressed therein.

In the event that SUPPLIER violates the TKSCOC and/or the commitments, values and ethics expressed therein, such violation shall be considered a material breach of SUPPLIER’s obligations. Furthermore, SUPPLIER shall indemnify CONTRACTOR from any claim, damage, demand, etc. made, incurred, and/or raised against or by CONTRACTOR.

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CONTRACTOR may at any reasonable time conduct or have conducted audits in order to investigate SUPPLIER’s compliance with the TKSCOC and/or the commitments, values and ethics expressed therein. SUPPLIER undertakes to fully cooperate with CONTRACTOR in this matter.

26 Applicable Law and Place of Jurisdiction

26.1 The PURCHASE ORDER shall be governed by and construed in accordance with the Laws of Japan, excluding its conflict of laws provisions and the United Nations Convention on Contracts for the International Sale of Goods (CISG).

267.2 Any disputes or claims arising under or in connection with the PURCHASE ORDER shall be exclusively and finally settled by arbitration under rules of conciliation and arbitration of the Japan Commercial Arbitration Association (JCAA) by three (3) arbitrators appointed in accordance with said rules.

Arbitration shall be conducted at Tokyo, Japan. All proceedings in such arbitration shall be conducted in English and transcripts of such proceedings shall pe prepared in English.

26.2 For Japanese SUPPLIER: All disputes or claims arising out of or in connection with the PURCHASE ORDER or the breach, termination or validity thereof shall be subject to the exclusive jurisdiction of the Tokyo District Court.






27 Miscellaneous

27.1 SUPPLIER´s documentation shall be made out in the English language. Operation Manuals and Maintenance Manuals shall be supplied in English. Documentation has to be prepared in accordance with the Documentation Instructions.

27.2 All agreements and correspondence made prior to placement of the PURCHASE ORDER are invalid, unless explicitly referred to in the PURCHASE ORDER.

27.3 Words used in the singular shall also include the plural and vice versa.

27.4 Each of SUPPLIER’s commercial invoices shall indicate the country (-ies) of origin of the delivered goods.

Unless specified otherwise in the PURCHASE ORDER, the country of origin is supposed to be Japan.

SUPPLIER shall provide the CONTRACTOR with a list of his SUB-SUPPLIERS.

27.5 In executing his obligations, the SUPPLIER shall employ all necessary care to avoid interference with, obstruction or damage to the environment in particular through pollution. He shall repair at his own cost any damage to the environment caused by himself or any SUB-SUPPLIERS.

27.6 SUPPLIER shall not be entitled to assign its contractual claims or rights vis-à-vis CONTRACTOR to third parties or permit third parties to collect same. This shall not apply for legally established or uncontested claims.

27.7 Severability clause

Should any provision (or a part thereof) of the PURCHASE ORDER be held by any court or authority of competent jurisdiction to be invalid or unenforceable, such invalidity or unenforceability shall not affect the validity of enforceability of the remaining provisions (or any portion thereof) of the PURCHASE ORDER.

The parties agree to replace the invalid or unenforceable provision (or any portion thereof) by a valid or enforceable provision (or portion thereof) in compliance with the applicable law as per Article 26 which comes closest to the original intent of the PARTIES. This also applies to deficiencies or omission in the PURCHASE ORDER not foreseen by the PARTIES at the time of signing the PURCHASE ORDER.