KARL MAYER Textilmaschinen AGTerms and Conditionsof Service
01. 01. 2009

1.
1.1

Scope
The subsequent Terms and Conditions of Service shall be exclusively applicable to all services performed by KARL MAYER­Textilmaschinen AG, Switzerland, in particular, the revision and repair of machines produced by KARL MAYER. Divergent terms andconditions of the purchaser shall only be applicable as far as we consent to them in writing.

2.
2.1

Conclusion of the service contract
The contract shall only be concluded upon the receipt of our written order confirmation by the purchaser or upon the acceptance of
our service by the purchaser.
Agreements deviating from our order confirmation and these Terms and Conditions of Service and other declarations of the parties
hereto shall be in writing in order to be applicable. Our staff is not permitted to conclude any additional verbal agreements or makeany verbal promises which deviate from the content of this written agreement or which change these Terms and Conditions of Service
to our disadvantage.

2.2

3.
3.1

3.2

3.3
3.4

4.
4.1

PricesIf nothing has been agreed to the contrary, services shall be charged according to expenditure of time and cost of material and ourpricelists valid at the time of placing the order plus value added tax. This shall also be applicable to technical records, inspection
reports and expertises to be developed in connection with the order as well as analyses of measurements and tests. The cost ofmaterial shall also comprise the costs incurred for the use of special tools and equipment as well as consumable materials andincidentals. The expenditure of time shall also include travelling time from our domicile in Uzwil to the place of work where theservice is to be performed and back, travelling times at the place of work as well as a time of preparation and implementation after
the journey appropriate for the order. The purchaser shall confirm the expenditure of time and cost of material expended at the placeof work by signing the respective work reports. If the purchaser does not sign the reports without any justification or not in time, ourinvoice shall be based on the records of our staff.
In addition to the price for services in accordance with Item 3.1 the purchaser shall pay the costs of travelling from our domicile to theplace of work and back, transport at the place of work and the haulage of materials and equipment as well as accommodation andmeals for our staff.
Prior to the commencement of repair work the purchaser shall be informed of the findings of our inspection.
If the purchaser dispenses with all or part of our performance of the services for reasons for which we are not responsible, we shallcharge the purchaser with the services already performed in accordance with Item 3.1 as well as the costs already incurred by us inaccordance with Item 3.2.
Terms of payment
If nothing has been agreed to the contrary, we shall invoice the purchaser according to Items 3.1 and 3.2 after the completion of theservice work. Such invoice shall be paid without any deduction within 30 days after the date of invoice. The obligation to pay shallhave been complied with as far as the invoice amount has been put at our free disposal at our bank in the currency in which we offered
our service. Cheques and notes are not considered payment until they have been honoured by a bank; bank fees are for the account of

4.24.3

the purchaser. The retention of payments or offsetting of counterclaims is only permitted if we have accepted this in writing or after
final and absolute court findings.
We shall be entitled to demand from the purchaser prepayment of up to 100% of the anticipated amount according to Items 3.1 and 3.2.
If payment periods are exceeded we shall be entitled to charge interest on arrears of 5% without any particular dunning notice and tocease the service work until payment has been effected. The payment of interest in arrears shall not cancel the obligation of payment
in accordance with the contract.

5.	Designs, technical records and computer programs
Each party hereto reserves all rights in designs, technical records and computer programs, particularly test and examination
programs, which it delivers to the other party. The receiving party recognizes these rights and shall treat the records and their content
strictly confidential, shall not make all or part of them accessible to third parties without the prior written consent of the other party
or use the same for other purposes than those for which they were delivered to it.
6.	Rights and duties of the purchaser
6.1 The purchaser shall inform us on the determined irregularities, damages or deficiencies for which service has to be performed andshall state the scope of testing to be implemented.
6.2 The purchaser shall ensure that our staff is not exposed to health and safety risks during service work. The purchaser shall particularly disclose all safety regulations which it has issued for its own staff.
6.3 The purchaser shall support us at its own expense as follows: The purchaser shalla) make available to us the technical records, designs, computer programs, particularly test and examination programs, operationaland check books required for the service work;b) permit our use of appropriate workshops and provide our staff with washing facilities and first-aid equipment; procure and makeavailable to us spare parts on time as far as they are not to be provided by us according to our order confirmation;c) make available to us skilled and unskilled labour to the extent considered necessary by us for the performance of test and servicework;d) perform all of the construction, bedding and scaffolding work considered necessary by us;e) provide all of the lifting gear, heavy tools and other required equipment considered necessary by us;f) provide heating, illumination, supplies, energy and water including the required connections;g) provide dry and lockable rooms for us to store our tools and equipment;h) admit our staff in case of sickness or accident to a physician working according to modern principles or to an appropriate hospital.
7.	Our duties and rights
7.1 We commit ourselves to perform the services by qualified staff in a professional manner or have them performed by a third party.
7.2 If it becomes apparent that services in addition to the agreed scope are required, we shall perform these in agreement with thepurchaser.
7.3 We shall be entitled to cease our services if the safety of our staff is not safeguarded or if the purchaser does not comply with its
contractual duties.
7.4 We insure our staff against sickness and accident and assume the respectively incurred costs.
8.

Warning notice
Our test results as well as our verbal or written statements to the purchaser concerning the condition, usage, safety and usability ofthe machine to be worked on as well as reservations expressed by us in the same form about regulations, instructions or measures ofthe purchaser or about other actual circumstances shall be considered a warning notice and shall release us from any liability.

9.
9.1

Completion date
Binding completion terms and dates shall be agreed upon the dispatch of the order confirmation at the earliest and not prior to theclarification of all details of the services to be performed and technical issues as well as the receipt of an agreed prepayment.
Services shall be considered performed within the time limit if the machine on which our services were performed has been deliveredor – if the delivery is delayed without our fault – has been notified by us as being ready for delivery prior to the completion date.
The term for completion shall be appropriately extended if– the purchaser does not comply with its obligation either on time or properly or– the purchaser places additional service orders or an extension of the scope of services is agreed or– a case of relief occurs (force majeure) according to Item 14.
If a binding term or extended term is not observed and it has been established that we are at fault, the purchaser is entitled to acompensation for the delay – as far as the purchaser has provably suffered a loss. In such cases, our liability shall be limited to alumb sum compensation of 0.5% per completed week, maximum however 5%, if ordinary negligence is involved. This percentage iscalculated from the price of the delayed services. Further claims and rights because of delayed performance, particularly forcompensation in damages, shall be excluded.

9.29.3

9.4

10.	Ownership, assumption of risks and insurance
10.1 If nothing has been agreed to the contrary, replaced parts shall remain the property of the purchaser.
10.2 The purchaser shall carry the risk of damage or loss of the machine to be worked on or part of the same during the implementation ofservice work or during transport or storage which might have become necessary.

10.3 The purchaser shall insure the machine to be worked on against damage of any kind.
10.4 The purchaser shall be responsible for the possibly required environmentally friendly disposal of replaced parts or consumablespares (oils, gases, dust, etc.) used in the service work.
11.	Delivery of services
11.1 We shall inform the purchaser of the completion of the services and the availability of the machine for its intended use. This shall also
apply if the machine cannot be restarted for reasons outside of our responsibility.
11.2 The purchaser shall then immediately check the services performed and conduct the inspections determined in the service contract.
After the performance of these checks and/or inspections the purchaser shall approve the services in writing. The purchaser shall not
be entitled to refuse this approval due to insignificant deficiencies which do not impair the use of the machine.
11.3 If the purchaser does not grant the approval without our fault or delays it, the approval shall be deemed to have been given by thepurchaser after the expiry of 5 working days from the date of our delivery.
12. Warranty
12.1 The purchaser shall inform us immediately of every discovered deficiency of our service work.
12.2 If the purchaser informs us of a deficiency in our service work within 12 months after delivery and if the purchaser can prove that wehave caused this deficiency, we shall rectify it at our expense through rework or replacement at our discretion. Should the rework be
unsuccessful or the replacement also be deficient, refused or delayed in an unjustified manner, the purchaser shall be entitled toeffect a deduction from the price corresponding to the reduced value of the service or demand compensation in damages within theframework of Item 13.
12.3 The warranty period shall be extended by the downtime of the machine caused by the deficiency. Our warranty becomes, however,statute-barred after the expiry of one year from the delivery date according to Item 11.
12.4 We shall not have any obligation under the warranty for deficiencies which are not our fault e.g. in case of improper operational
conditions or improper use as well as deficiencies caused by faulty maintenance, faulty assembly or installation by the purchaser or
which are due to changes to our service works without our prior written consent, repair performed by the purchaser or third parties ornormal wear and tear.
12.5 Further claims and rights from deficiencies than those stated in Items 12.1 to 12.4 shall be excluded.
13. Limitation of liability
13.1 We shall only be liable if the purchaser proves that we have caused damage by gross negligence or intention. As far as this is legallypermissible, our liability for indirect damage, e.g. loss in production, utilization loss, losses of orders, lost profits or other consequential damage, shall be excluded. We shall not be liable for any misconduct of our auxiliary personnel at all.
13.2 With the exception of claims resulting from product defects according to legally compulsory product liability regulations, all claims
for damages of the purchaser shall become statutebarred one year after the purchaser became aware or should have become aware
without gross negligence of the presence of the damage and the liable party.
14.	Reasons for relief (force majeure)14.1 The following circumstances shall be considered reasons for relief if they occur after the conclusion of the contract and cause animpairment or the impossibility of performing the contract: All unforeseen, unavoidable events for which the affected party is not
responsible, e.g. acts of God, strikes and lockouts, plant interruptions, lack of labour, difficulties in material and energy procurement,
measures of authorities and transport delays.
These circumstances shall extend the term for the completion of services by the duration of the interruption and its effects. This shallalso be applicable to circumstances experienced by our suppliers or during an existing delay.
14.2 The party claiming one of the circumstances mentioned above shall inform the other party immediately and in writing of its occurrence and cessation.
14.3 If such circumstances render the performance of the contract impossible within an appropriate period of time, each party shall havethe right of terminating the contract by a simple written notice. In case of such a notice we shall be entitled to the payment of alreadyperformed services according to Item 3.1 as well as the expenditure incurred in accordance with Item 3.2.
15.	Applicable law and place of jurisdiction
15.1 This contract shall be governed by Swiss law.
15.2 The place of jurisdiction shall be the domicile of the supplier. We shall, however, be entitled to bring a matter before the competentcourt at the purchaser‘s domicile.
16.

Partial invalidity
Should a provision of these Terms and Conditions of Service prove to be completely or partially ineffective, this shall not affect theeffectiveness of the remaining provisions of the contract. The ineffective provision shall be replaced by a new, effective provision
which comes as close as possible to the legal and economic result of the ineffective provision.

KARL MAYER Textilmaschinen AG · Sandackerstrasse 26 · 9245 Oberbüren · Switzerland · www.karlmayer.com