GENERAL CONDITIONS FOR THE SUPPLY OF PRODUCTS AND SERVICES OF THE ELECTRICAL AND ELECTRONICS INDUSTRY for commercial transactions between businesses

I. INTRODUCTION

1. These general conditions of sale[“GC”] have been established to govern the legal relations between Tavrida Electric Africa [PTY] LTD, the supplier of the equipment and services [hereinafter referred to as the “Seller/Supplier”] and its customer, who places an order for said equipment and services [hereinafter referred to as the “Purchaser”].(The said equipment and services will hereinafter be referred to as the “Supplies”)

2. Submission of an order, based on a quotation from the Seller, signed by Purchaser acknowledges Purchaser’s acceptance of these General Conditions and releases Seller from compliance with any conditions of purchase or any other similar document of the Purchaser, unless Seller has expressly accepted such conditions in writing.

The sale shall not be final until Seller has issued a written acknowledgement of receipt for the order, which shall set forth the special contract terms including, if applicable, any exceptions to these general conditions expressly accepted by Seller in writing [hereinafter referred to as the “special conditions of sale”].

3. The Contract shall consist of:
An agreement signed by either parties, or the order, based on a  quotation from the Seller, and its acknowledgement of receipt; Any complementary specific and/or special conditions of sale; These General Conditions of Sale[“GC”] and/or the remainder thereof in so far as the Seller has not expressly accepted any exceptions to these general conditions of sale in writing, which form an integral part of the Contract. {hereinafter referred to as “the contract/agreement”}

4. The term “claim for damages” used in the present “GC” also includes claims for indemnification for useless expenditure.

II. EFFECTIVE DATE

The Contract shall not be effective until Seller has received the down payment as set out in the order or by default at the date and as specified in the acknowledgement of receipt. 

Unless otherwise stipulated in the special conditions of sale, the date of receipt of said down payment shall constitute the starting date for Seller’s contractual obligations and for the schedules specified in the Contract for delivery of equipment and performance of services.

III. CONTRACT EXECUTION

1. Supervision of execution.

When provided for in the special conditions of sale, Purchaser may supervise the execution of the Contract. For this purpose Purchaser or its representatives shall have access to the facilities of Seller and its suppliers or subcontractors during their working hours. If the special conditions of sale provide for supervision, the cost thereof shall be borne entirely by Purchaser; this supervision shall not hinder or delay the execution of the Contract.

2. Subcontracting.

Seller shall have the right to subcontract all or part of the equipment, services and work specified in the Contract.

IV. CHANGES

1. During execution of the Contract, Seller may introduce changes in the equipment as required by mandatory circumstances such as the modification of technical standards or manufacturing methods, or legislative and regulatory provision, affecting the conditions of Contract execution. Such changes shall not, however, affect the fundamental characteristics of the equipment and services specified in the Contract.

2. If said changes have any effects that prevent or make more difficult the fulfilment of certain Contract provision/s, particularly those relating to prices or delivery schedules, Seller shall submit to Purchaser the appropriate supporting documents therefore and the parties shall sign an additional clause setting forth the requisite Contract alterations.

V. DELIVERY - STORAGE  - PRICING

1. Delivery.

Delivery shall be completed when the equipment sold has been made available to Purchaser in Seller’s facilities or warehouses, or in the facilities or warehouses of Seller’s suppliers or subcontractors, regardless of the terms of delivery. This provision shall be valid even if the Contract includes other service such as transportation, erection, installation and commissioning. Notwithstanding anything to the contrary contained in this agreement it is agreed that the purchaser shall not refuse to receive Supplies due to minor defects. It is furthermore agreed that partial deliveries are allowed.

2. Storage.

If Purchaser does not take delivery of the equipment within 30 (thirty) days of notification that they are ready for delivery Seller shall be entitled on behalf of Purchaser to put the equipment into storage at Purchaser’s expense. Seller shall be deemed to have delivered such equipment to Purchaser on storage and shall be entitled to payment on presentation of the warehouse receipt in place of/ in addition to, any bill of lading or similar document otherwise required under the Contract. Risk shall pass to Purchaser on storage, but title shall only pass in accordance with the provisions of Clause “12  TRANSFER OF TITLE” below.

3. Prices.

Where products are purchased from our overseas factories the price will be subject to the ruling rate of exchange at date of quotation, unless otherwise stipulated in the quotation. Any variation to this rate at date of quotation to the date of foreign payment will be for the Purchaser’s account.
Where products are manufactured at our local factories e.g.” South Africa” prices will be subject to the SIEFSA indices quoted at the time of tender or quotation and any variation to this rate from the time of contract to the completion of contract will be for the Purchaser’s account.
Prices are ex works; value added tax shall be added at the then applicable rate.
If the Supplier is also responsible for assembly or erection and unless otherwise agreed, the Purchaser shall pay the agreed remuneration and any incidental costs required e.g. for travelling and transport as well as allowances.

VI. TRANSFER OF RISKS

1. Even where delivery has been agreed freight free, the risk shall pass to the Purchaser as follows:

• if the Supplies do not include assembly or erection, at the time when the Supplies are shipped or picked up by the carrier. Purchaser must provide any necessary further insurance required.
• if the Supplies include assembly or erection, at the day of taking over in the Purchaser’s own works or, if so agreed, after a fault-free trial run or upon the issue/deemed issue by the Purchaser of an acceptance certificate therefore to Seller as per clause 21.6., whichever period is sooner.

2. The risk shall pass to the Purchaser if dispatch, delivery, the start or performance of assembly or erection, the taking over in the Purchaser’s own works, or the trial run is delayed for reasons for which the Purchaser is responsible or if the Purchaser has otherwise failed to accept the Supplies.

VII. LATE DELIVERY - LIQUIDATED DAMAGES

1. Times set for Supplies shall only be binding if all Documents to be furnished by the Purchaser, necessary permits and approvals, especially concerning plans, are received in time and if agreed terms of payment and other obligations of the Purchaser are fulfilled. If these conditions are not fulfilled in time, times set shall be extended reasonably; this shall not apply if the Supplier is responsible for the delay.

2. In case of delay in delivery, Seller shall pay to Purchaser a compensation calculated at the rate of 0.1 % of price of delayed part of equipment per full week of delay (unless otherwise provided in the special conditions) which shall not in any event exceed 5% of the net Contract price and shall not apply until such time that a summons for specific performance/delivery has been duly served on the Seller.

3. The payment in clause 7.2. shall take the form of lump sum compensation and shall constitute the limit of Seller’s liability for claims for damages due to delayed supplies as well as claims for damages in lieu of performance. No penalty shall be imposed on Seller for late delivery or late receipt due to any circumstance attributable to Purchaser, or to Force Majeure or when such delay has not resulted in any damages for Purchaser.

VIII. FORCE MAJEURE

The Supplier shall be liable for defects as to quality (“Sachmängel”, hereinafter referred to as “Defects”,) as follows:

1. Seller shall not be liable in any way whatsoever for failure to fulfil its obligations as a result of Force Majeure.
Force Majeure shall be defined as any event that prevents total or partial execution of the Contract and that cannot be overcome despite reasonable effort on the part of Seller or its agents. Force Majeure shall include, but shall not be limited to, the following events:

• Acts of god
• Labour conflicts
• Shortage of skilled workers or raw materials
• Major incidents affecting the production of Seller’s agents
• Fire and explosions
• Action or failure to act public serves or government authorities
• Acts of war, sabotage, embargoes
• Insurrections, riots, breach off peace
• Major incidents, affecting manufacturing, particularly tooling accidents or rejection of key components (e.g., forging)
• Transportation interruptions or delays.

2. If the Force Majeure event continues for more than four (4) months or as soon as it is not justifiable for economic reasons as per Seller’s notice and the parties have not agreed upon the modes for continuing the Contract, Seller shall have the right to terminate the Contract by not less than thirty (30) days’ notice in writing to Purchaser, in which event the provision of the “Clause 15: TERMINATION” shall apply.

IX. WARRANTY

1. Seller’s contractual warranty shall cover design, materials and manufacturing deficiencies for the equipment sold. Seller shall correct said deficiencies in the manner it deems appropriate, i.e. by repair, alteration or replacement. Seller shall bear the cost of parts and labour required for execution of its warranty obligation. The parts replaced pursuant to the warranty shall be the property of Seller. They shall be returned to the place of delivery upon request. If necessary, Seller shall have the right to modify the equipment specified in the Contract so as to fulfil its warranty obligations.

2. The warranty period shall be effective as of the delivery or acceptance of the equipment. The duration of the warranty period shall be stipulated in the special contract terms or, failing that, shall be a period of 12 months after delivery whichever is the shorter period. To exercise the warranty, Purchaser shall immediately notify Seller of any deficiency and shall communicate to it in writing as soon as possible any available information relating to the observed deficiency.

3. However, Seller shall not be required to fulfil any warranty obligation in the following cases:

3.1   Deficiencies attributable to design, material, manufacturing or erection techniques imposed by Purchaser;

3.2   Servicing or repair of the equipment specified in the Contract by Purchaser or by third parties under conditions not previously approved in writing by Seller;

3.3   Flaws or degradation caused by error or negligence of the equipment user or by a Force Majeure event or unforeseeable circumstances;

3.4   Failure to comply with Seller’s instructions;

3.5   Routine maintenance or replacement of parts required by normal equipment wear and tear or by equipment exposure to inclement weather.

3.6   There shall be no claims based on Defect in cases of insignificant deviations from the agreed quality, of only minor impairment of usability, or damage arising after the passing of risk from faulty or negligent handling, excessive strain, unsuitable equipment, defective civil works, inappropriate foundation soil, or claims based on particular external influences not assumed under the contract, or from non-reproducible software errors. Claims based on defects attributable to improper modifications or repair work carried out by the Purchaser or third parties and the consequences thereof are likewise excluded.

The components and spare parts constituent the equipment comply with standards requirements, design features and quality measures which correspond to specific requirements and are appropriate for the use to which the equipment is intended. Consequently, Seller’s warranty obligation shall expire automatically if any or all of the components or spare parts are replaced by components or parts not furnished by Seller.

4. Seller may not under any circumstances be required to bear expenses other than those attributable pursuant to this warranty clause. In particular, Seller shall not be liable for payment of expenses incurred by Purchaser or by third parties during immobilisation of equipment due to the performance of work pursuant to the warranty. Furthermore, including but not limited thereto, all transportation charges incurred in returning defective products or any of its component parts, for repair, together with the cost of returning them to the Purchaser must be paid by the Purchaser.

5. The warranty of Seller under this Clause is in place and excludes all other warranties and commitments, whether oral, written, statutory, express or implied. There are no implied warranties or other conditions of any kind. Seller’s liabilities and Purchaser’s remedies in respect of defects in the equipment or services and any damage to the equipment however caused are solely and exclusively as stated in this WARRANTY Clause, and Seller shall have no liability of any kind for any such defects or damage which appears after expiry of the warranty period described above.

X. PAYMENTS

1. Payments shall be made to the Seller’s address net and free of any discount. The terms of payment shall be cash on delivery except if stated otherwise in the Contract provisions. The equipment sold shall be paid in full before the start of erection or installation.

2. If Purchaser fails to make any payment on the due date then, without prejudice to any other right or remedy available to Seller, Seller shall be entitled to charge Purchaser interest on the amount unpaid at the rate of seven percent per annum above Reserve Bank’s base rate or at the maximum rate allowable by South African legislation, from time to time until payment in full is made (a part of a month being treated as a full month for the purpose of calculating interest).

3. All goods and services sold/purchased or rendered will remain the property of the Seller until such amounts are paid up in full. Any disputes will not be entertained prior to the settlement of the account.

XI. TAXES

1. Except as specifically provided elsewhere in the Contract, any duty or tax on any payment to Seller or on the equipment or the Contract or on the material, property or activities of Seller, its subcontractors or any of their respective employees in relation to the Contract levied outside the country of Seller is not included in the Contract price and shall be for the account of Purchaser.

Any such duty or tax and any interest or penalty in respect of late payment shall be paid by Purchaser directly to the appropriate authorities, or, where Seller elects to pay the same, Purchaser shall promptly compensate Seller for the full amount of any such payment made.

2. For exports from the country of Seller, Purchaser shall pay to Seller the amount of any VAT or similar sales taxes.

If any law, regulation or standard comes into force after the effective date of this contract, which increases or reduces the cost of performing the Contract, the Contract price shall be adjusted accordingly.

XII. TRANSFER AND RESERVATION OF TITLE

1. The items pertaining to the Supplies (“Retained Goods”) shall remain the Supplier’s property until each and every claim the Supplier has against the Purchaser on account of the business relationship has been fulfilled, including, without limitation thereto, that the purchaser pays the seller in full for the purchased goods. If the full amount owing is not paid to the seller, the seller is entitled to collect and demand for the return of the goods in question and any damages done to the goods sold or costs incurred by the seller to recover such goods will be borne by the purchaser. After receipt by the seller of payment in full, the title (legal and beneficial ownership) in the equipment shall pass to Purchaser upon loading on board the transportation vehicle at the port or depot or other point of export unless otherwise provided in the Contract.

2. For the duration of the retention of title, the Purchaser may not pledge the Retained Goods or use them as security, and resale shall be possible only for resellers in the ordinary course of their business and only on condition that the reseller receives payment in full from its customer or makes the transfer of property to the customer dependent upon the customer fulfilling its obligation to effect payment in full and on the condition that the purchaser consequently and immediately upon receipt of any monies from the customer [purchaser’s customer] pays the due amount over to the seller. The aforementioned in no way derogates the seller’s right to ownership of the resold goods or its right to receive payment from the purchaser timeously nor is it a waiver of the seller’s right to claim the full amount due immediately when the amount becomes due and payable.

3. The Purchaser shall inform the Supplier forthwith of any seizure or other act of intervention by third parties.

4. Despite clause 12.3. if the Purchaser supplies any of the goods to any person before all monies payable by the Purchaser have been paid to the Supplier (and have not been claimed or clawed-back by any person standing in the place of or representing the Purchaser), the Purchaser agrees that:

• it holds the proceeds of re-supply of the goods on trust for and as agent for the Supplier immediately when they are receivable or are received;
• it must either pay the amount of the proceeds of re-supply to the supplier immediately when they are received or pay those proceeds into an account with a Bank or a Financial Institution or Deposit-Taking Institution as Trustee for the Supplier;
• any accessory or item which accedes to any of the goods by an act of the Purchaser or of any person at the direction or request of the Purchaser becomes and remains the property of the Supplier until the Supplier is paid in accordance with clause 12.1. when the property in the goods (including the accessory) passes to the Purchaser;
• if the Purchaser fails to pay for the goods within the period of credit (if any) extended by the Supplier to the Purchaser, the Supplier may recover possession of the goods at any site owned, possessed or controlled by the Purchaser or by the Purchaser’s customer and the Purchaser agrees that the Supplier has a irrevocable licence to do so.

5. Where the purchaser fails to fulfill its duties, fails to make payment due, or otherwise violates its obligations, the Seller shall be entitled to rescind the contract and take back the Retained Goods and claim damages in the case of continued failure following expiry of a period of 7 days after notice has been provided to the purchaser to rectify the default and subject to the understanding that the aforementioned 7 day notice period or any other period given is not a prerequisite in order for seller to rescind the contract, claim back the goods and claim damages. The purchaser shall be obliged to return the retained goods, at the purchaser’s sole cost, irrespective of the location of the premises at which the retained goods might be at that point in time. The fact that the supplier takes back  Retained Goods and/or exercises the retention of title, or has the Retained Goods seized, shall not be construed to constitute a rescission of the contract, unless the seller so expressly declares.

XIII. CONFIDENTIAL TREATMENT AND SECRECY

1. The Supplier herewith reserves any intellectual property rights and/or copyrights pertaining to its cost estimates, drawings and other documents (hereinafter referred to as “Documents”). The Documents may only be used by the Purchaser for the execution of the Contract and shall not be made accessible to third parties without the Supplier’s prior written consent and shall, upon request, be returned without undue delay to the Supplier if the contract is not awarded to the Seller. This sentence shall apply mutatis mutandis to the Purchaser’s Documents; these may, however, be made accessible to those third parties to whom the Supplier has rightfully subcontracted Supplies.

2. The Purchaser has the non-exclusive right to use standard software and firmware, provided that it remains unchanged, is used within the agreed performance parameters, and on the agreed equipment. 
 
3. Seller shall retain the exclusive ownership of the further Documents, and/or studies performed by it, or by its representatives or subcontractors, for the successful execution of the Contract.

XIV. SUSPENSION

1. If Purchaser fails to make any payment when due or perform on time any of its other obligations under the Contract:

1.1   Seller shall be entitled to suspend performance of the Contract until the failure is remedied,

1.2   The time for performance of the Contract by Seller shall be extended accordingly,
Any cost (including financial costs and storage, demurrage or other charges) thereby incurred by Seller shall be paid by Purchaser on demand by the Seller.

2. If the performance of the Contract is for any reason suspended and such suspension continues for more than 4 months or as soon as it is not justifiable for economic reasons as per Seller’s notice the Seller shall have the right to terminate the Contract by not less than thirty (30) days’ notice in writing to Purchaser, in which event the provision of the “Clause 15: TERMINATION” shall apply.

XV. TERMINATION

In case of termination of the Contract in whole or in part however occasioned, Purchaser shall pay to Seller, without prejudice to any other remedy that the Seller may have:

1. The outstanding balance of the Contract value of the equipment and services which have been duly delivered or performed,
2. &The costs incurred by Seller up to the date of termination in performing work on equipment or services which are not then in a deliverable state plus a reasonable sum to compensate the loss of profit.

XVI. BANKRUPTCY

If Purchaser becomes bankrupt or insolvent or makes any agreement with its creditors compounding debts or if, being a limited company, any proceedings are begun in respect of it applying for the appointment of a liquidator, administrator, receiver or similar official for it or all or any substantial part of its assets or seeking an order of relief against it as debtor or under any law relating to insolvency, readjustment of debt, reorganisation, administration or liquidation, Seller may at any time by written notice terminate the Contract forthwith, in which event the provisions of the “Clause 15: TERMINATION” shall apply.

XVII. LIABILITY

1. Seller’s liability shall be strictly limited to the obligations specified in the Contract.
Seller shall not in any circumstances be liable to indemnify the loss of use, loss of production, loss of profits, loss of contracts, any financial or economic loss or any indirect or consequential loss or damage whatsoever whether suffered by Purchaser or by any third party.

2. For all motives considered together, Seller’s liability shall be limited to the price stipulated in the Contract for the equipment or service giving rise to a claim.

3. Purchaser shall hold Seller harmless from any recourse or actions for recovery made by Purchaser’s insurers above the limits or beyond the exclusions contained in the present LIABILITY Clause.

XVIII. INFRINGEMENT

1. The Supplier warrants that all products are free from third parties intellectual and proprietary rights including copyright[hereinafter referred to as “IPR”]. If any claim is made against Purchaser using any designs, drawings, specifications or other documents produced by Seller in the using of the equipment in relation to the patent, copyright, design, trademark or other industrial or intellectual property rights of any third party, Seller shall indemnify Purchaser against all loss, damages, reasonable costs and expenses awarded against or incurred by Purchaser in connection with the claim or reasonably agreed to be paid by Purchaser in the settlement of the claim.

2. This indemnity is conditional on Purchaser giving Seller notice, which notice must be given within 3 days after Purchaser becomes aware of any such claim, of any claim for infringement and permitting Seller (at Seller’s expense) to conduct on Purchaser’s behalf any litigation or negotiations in respect thereof.

3. Claims of the Purchaser shall be excluded if it is responsible for the infringement of an IPR.

4. Claims of the Purchaser are also excluded if the infringement of the IPR is caused by specifications made by the Purchaser, by a type of use not foreseeable by the Supplier or by the Supplies being modified by the Purchaser or being used together with products not provided by the Supplier.

5. Any other claims of the Purchaser against the Supplier or its agents or any such claims exceeding the claims provided for in this Article 18, based on a defect in title, are excluded.

   The foregoing states Seller’s entire liability for intellectual and industrial property rights infringement.

XIX. APPLICABLE LAW

This agreement and all matters or disputes arising therefrom or incidental thereto shall be governed by and construed in accordance with the Laws of the Republic of South Africa.

XX. ARBITRATION

1. The seller has the exclusive right to decide whether any dispute shall be further dealt with in a South African Court of Law or by means of arbitration and subject to the seller’s written decision in this regard, the parties certify that they have the power to compromise and agree that all disputes arising out of or in connection with the Contract (including its validity and termination) and which could not be solved by an amicable settlement shall be finally settled upon by the Rules of Arbitration of the Republic of South Africa. The arbitration shall take place in Johannesburg, South Africa, in the English language and in accordance with the provisions of the Arbitration Act 42 of 1965 (as amended or replaced from time to time ) The Contract shall be governed by and construed in accordance with South African law.

2. In case of dispute on a technical matter, the Parties agree to have recourse as occasion requires to the international Centre for Technical Expertise of the International Chamber of Commerce in accordance with the Rules of technical expertise of the said Chamber.

XXI. ASSEMBLY AND ERECTION

Unless otherwise agreed in written form, if the equipment is to be erected or installed by Seller or its subcontractors, assembly and erection shall be subject to the following provisions:
1. The Purchaser shall provide at its own expense and in due time:

1. all earth and construction work and other ancillary work outside the Supplier’s scope, including the necessary skilled and unskilled labour, construction materials and tools,
2.   the equipment and materials necessary for assembly and commissioning such as scaffolds, lifting equipment and other devices as well as fuels and lubricants,
3. energy and water at the point of use including connections, heating and lighting,
4. suitable dry and lockable rooms of sufficient size adjacent to the site for the storage of machine parts, apparatus, materials, tools, etc. and adequate working and recreation rooms for the erection personnel, including sanitary facilities as are appropriate in the specific circumstances; furthermore, the Purchaser shall take all measures it would take for the protection of its own possessions to protect the possessions of the Supplier and of the erection personnel at the site,
5. protective clothing and protective devices needed due to particular conditions prevailing on the specific site.

2. Before the erection work starts, the Purchaser shall unsolicitedly make available any information required concerning the location of concealed electric power, gas and water lines or of similar installations as well as the necessary structural data.
3. Prior to assembly or erection, the materials and equipment necessary for the work to start must be available on the site of assembly or erection and any preparatory work must have advanced to such a degree that assembly or erection can be started as agreed and carried out without interruption. Access roads and the site of assembly or erection must be level and clear.

4. If assembly, erection or commissioning is delayed due to circumstances for which the Supplier is not responsible, the Purchaser shall bear the reasonable costs incurred for idle times and any additional travelling expenditure of the Supplier or the erection personnel.

5. The purchaser shall immediately confirm in written form if assembly, erection or commissioning has been completed.

6. Subject to clause 5.1. above, if the equipment is to be erected or installed by Seller or its subcontractors, Purchaser or its representative shall carry out acceptance of the equipment as erected and/or installed at the location specified in the Contract and shall issue an acceptance certificate therefore to Seller.
  
   However, acceptance of the equipment as erected and/or installed shall be deemed complete at the first of the following dates:

6.1  The day of first utilisation by Purchaser.

6.2  One month after commissioning of the equipment, if Purchaser has not carried out or had carried out the acceptance thereof.

6.3  Fifteen[15] days after issue of notice to Purchaser to carry out acceptance.

If provision is made for acceptance of the equipment as erected and/or installed in the plants of Seller or its agent suppliers or subcontractors, acceptance shall be deemed complete 15 days after Seller has issued notice to Purchaser to carry out same.

XXII. GENERAL

1. Seller is a member of the Tavrida Electric Group of Companies and accordingly the Seller may perform any of its obligations or exercise any of its rights under the Contract by itself.

2. Seller is free to sub-contract all or part of the equipment and services contained within the Contract.

3. Purchaser shall refrain from any action or practice with a view to hiring away Seller’s personnel.

4. Purchaser shall assist Seller in obtaining any and all visas, permits, and licenses, which may be required for importation of the equipment.

5. No waiver by a party of any breach of the Contract by the other party shall be considered as a waiver of a subsequent breach of the same or any other provision.

6. If any provision of the Contract is held by any competent authority to be invalid or unenforceable either in whole or in part thereof, the validity of the other provisions of the Contract and the remainder of the provision in question shall not be affected thereby.