1 General
All supplies and services ("Product") – e.g. roll covers, spare parts, service and maintenance, regrinding work, repairs, etc. – by Rollianz Lihua Paper Rolls Co., Ltd. ("Seller") to the customer ("Buyer") shall be based on these Conditions as well as separate contractual agreements. Deviating purchasing conditions of the Buyer shall not become part of the contract, even in case an order of the Buyer containing deviating conditions is accepted by the Seller without objection. In the absence of special agreement, a contract shall enter into effect upon the Seller's authorized signature or company stamp.
1.1 If trade terms are agreed, the rules of interpretation of INCOTERMS in their most recent version shall apply, unless otherwise provided for in these Conditions.
1.2 Documents such as illustrations, drawings, and information concerning dimensions and capacities shall be regarded as an approximate guide only, unless it is explicitly stated that they are binding. Cost estimates, drawings and other documents shall not be reproduced or made available to third parties; the Seller reserves the rights of ownership and use. The Seller shall not grant third parties access to documents which the Buyer designates as confidential unless the Buyer gives its consent.
1.3 Once an order has been accepted by the Seller, it may be cancelled by the Buyer only with the Seller's express written consent. In the event that the Seller accepts a cancellation, it shall be agreed that the Seller will suffer no loss whatsoever from such cancellation and will be entitled in such a case to recover the value of all services rendered, including any work in progress, any expenses incurred, cancellation charges, profit margin, etc.

2 Price
2.1 All prices shall be calculated based on the date and contents of the quotation. In the event of cost increases compared with this basis (e.g. increases in cost of materials, changes in or deviations from drilling pattern, altered scope of work for service and repair orders, etc.) during order handling and/or until the date of delivery, the Seller shall be entitled to raise the prices accordingly. Prices and supplies to the Buyer shall be "ex works" (INCOTERMS as amended), exclusive of packing and value added tax. The value added tax shall be charged separately at the rate in force on the date of invoicing. All parts, such as roll bodies, etc., supplied to the Seller for processing purposes shall be sent, freight prepaid, in sturdy transport cases reusable for return transport.
2.2 Packing, such as cases, received in a damaged condition shall be repaired or replaced by the Seller at the Buyer's expense. Packing materials supplied by the Seller shall not be taken back.
2.3 The Seller shall be held liable for any damage to, or loss of, packing materials only in the event of gross negligence attributable to the Seller. Damages shall in any case be limited to the current value of the packing.
2.4 Partial deliveries shall be allowed and shall be paid by the Buyer on a pro rata basis.

3 Payment
3.1 Unless otherwise expressly agreed, all payments to the Seller shall be made, without any deduction, within fourteen (14) days from the date of invoice.
3.2 If, despite a payment reminder and a set grace period, the Buyer defaults in payment, any other outstanding amounts related to the contract but not yet due at such time shall fall due for immediate payment without any deduction.
3.3 If the Buyer delays in making a payment for more than ten (10) days or protests bills of exchange or cheques, if a petition is filed for the institution of insolvency proceedings against the Buyer's property, or if the Buyer de facto suspends its payments, the Seller shall, without prejudice to any other rights, be entitled to:
3.3.1 fix a due date for any amounts owed by the Buyer if the delay/protest relates to a financing or redemption agreement；
3.3.2 withhold any supplies or services under contracts not yet or not entirely fulfilled, unless the Buyer either pays in advance or gives security to satisfy the Seller;
3.3.3 assert any rights subject to retention of title.
3.4 The Seller shall have the right to suspend the delivery of all Products purchased or ordered from it until the Buyer has fully met all of the obligations it had towards the Seller at the time of the agreed delivery, unless the Seller makes any justified objections against the obligations.
3.5 Cheques and bills of exchange shall only be accepted as conditional payment.
3.6 If the Buyer fails to make payment on the due date, interest shall be charged on the amount due at 0.04 per cent per day.
3.7 The Buyer shall have the right to withhold payments or set off against counter- claims only in so far as its counterclaims are uncontested or have legal force.

4 Risk Transfer
4.1 The Products shall be delivered and dispatched ex Seller's works for the account and at the risk of the Buyer. The risk of loss shall pass to the Buyer when loading at the Seller's works is started. The place of delivery shall be the place of manufacture of the Products or the Seller's distributing depot. In the absence of special agreement, the mode of dispatch shall be determined by the Seller, while excluding any liability.
4.2 The Seller shall exercise due care to prepare and pack the Products for transport so as to prevent any damage in transit, but shall not assume any liability in this respect. The Products shall be insured by the Seller only upon the Buyer's express request, and the Seller shall exercise due care to comply with any relevant instructions given by the Buyer; any liability on the part of the Seller, however, shall be excluded.
4.3 If an acceptance has been agreed, it shall immediately be carried out on the agreed date or alternatively after the Seller has given notice of the readiness for acceptance. The Buyer cannot reject the Products on the grounds of an insignificant defect, provided the Seller expressly accepts its obligation to remedy the defect.
4.4 Delivery periods shall be notified to the Buyer as precisely as possible under the given circumstances. Unless otherwise agreed, all delivery periods shall start to run on the date of coming into force of the contract or, if there is any disagreement on the mode of execution of an order, on the date when final clarification has been reached and mutually agreed upon.
4.5 Compliance by the Seller with the agreed delivery dates requires that any necessary approvals, documents to be supplied by the Buyer and releases have been obtained and/or services and other obligations of the Buyer have been rendered/fulfilled. If this is not the case, the delivery period shall be reasonably extended.
4.6 If the Seller can foresee that the delivery date (s) as stipulated in contract could not be kept, he has to inform the Buyer about the potential delay and the reasons therefore and seek for an adequate extension of the delivery date (s). If the Seller does not keep the new delivery date (s) as agreed with the Buyer, for reasons the Seller is at fault, the Buyer shall be entitled to claim as liquidated damages an amount of 0.5 % per week of the net delivery value of the Contract Equipment delayed, max. however, 5 % of the net delivery value of the Contract Equipment concerned. The above compensations are due, provided all legal prerequisites of delay are fulfilled, i.e. in particular no case of Force Majeure as defined by this Contract exists and the Buyer has suffered damage due to the Seller’s delay.

5 Retention of Title
5.1 The Seller shall retain title to the Products supplied until all its claims against the Buyer, including any outstanding balances, arising out of the sale of the Products have been settled (Products subject to retention of title). In addition, the Seller shall have the right to mark the Products on the outside as being the Seller's property. The Buyer shall meet the formal requirements for the retention of title.
5.2 If the Products delivered by the Seller under retention of title are incorporated into other products so that they are an integral part of the other products or if the Products delivered by the Seller under retention of title are processed to new products, and the Buyer will acquire the ownership of the above mentioned other or new products by incorporating or processing, the Buyer shall transfer at the same time to the Seller a joint ownership share of the other or new products which equals to the value of the Products delivered by the Seller.
5.3 If the Buyer acts in contravention of the terms of the contract, particularly if it defaults in payment, the Seller shall be entitled to take back the supplied Products after having requested payment. Such action, as well as seizure of the Products by the Seller, shall not give reason for the Buyer to rescind the contract. The Buyer shall notify the Seller without delay of all procedures affecting the retention of title, in particular measures of execution or actual impairments to the Products delivered subject to retention of title.
5.4 Filing an application to initiate insolvency proceedings against the Buyer shall entitle the Seller to rescind the contract and demand the immediate return of the supplied Products.

6 Warranty
6.1 The Seller shall assume a warranty obligation as follows:
6.1.1 Polyurethane covers: 12 months from start-up or 24 months maximum from delivery, whichever comes first, on pro rata temporized basis.
6.1.2 Rubber covers and calender roll covers: 12 months from start-up or 18 months maximum from delivery, whichever comes first, on pro rata temporized basis.
6.1.3 Roll service and maintenance, regrinding work, spare parts,, etc.: 6 months from start-up or 12 months maximum from delivery, whichever comes first, on pro rata temporized basis.
6.1.4 New rolls: 24 months from start-up or 30 months maximum from delivery, whichever comes first, on pro rata temporized basis.
6.1.5 Any warranty of the Seller for other wear parts and repairs of roll covers (local repairs, ring repairs) shall be excluded.
6.2 Any warranty of the Seller shall be dependent on the strict compliance with the specified operating conditions and the intended use of the Products in chemical, thermal and mechanical terms and proper operation (adherence to operating and maintenance instructions by the Seller). Details provided by the Seller regarding the properties of its Products shall conform to the results of its measurements and calculations and shall be deemed to be quality features, but not warranted characteristics or guarantees.
6.2.1 The warranty for roll covers according to 6.1.1 and 6.1.2 as well as for new rolls according to 6.1.4 shall be limited to faultless material and workmanship. In case a fault in material and workmanship does not negatively influence the operation of the paper machine, the Buyer shall have no right to a warranty claim.
6.2.2 For regrinding and service work according to 6.1.3, however, the Seller shall in any case warrant the proper performance of the work.
6.3 In the case of a complaint of defects, the Seller shall have the right to inspect the defective Product in operation. Upon request, the defective Product shall be returned, freight prepaid, to the Seller.
6.3.1 As a matter of principle, any warranty for Products of the Seller shall be excluded in the following cases:
6.3.2 if the operating conditions of the machine do not correspond to the conditions specified to the Seller in the order document or to the conditions as are usual in such cases or if the conditions are unsatisfactory in technical terms, i.e. if the Products are not operating under normal and technically sound operating conditions (e.g. in the case of thermal, chemical or mechanical overloading, or in the case of defects caused by inadmissible deformation of the roll body or by improper maintenance, etc.);
6.3.3 if the Products were not handled or stored in accordance with the Seller's operating and maintenance instructions and/or were damaged during transport or by frost (refer in particular to the Seller's recommendations for the transport and storage of covered rolls);
6.3.4 if the roll body or the Product sent to the Seller for repair was of faulty design or otherwise defective; the Buyer shall be responsible that the roll body or the Product sent to the Seller for repair features standard design and quality as well as standard or specified materials;
6.3.5 if the roll body sent to the Seller, due to released stresses, is changed in a way that damage occurs to the Product supplied by the Seller (e.g. roll covers). The roll body shall be dimensioned so as to resist the stresses occurring during the covering process.
6.4 Complaints of defects shall be made in writing, specifying the kind and extent of defects and invoice number, within eight (8) days after arrival of the Product at the place of destination stated in the delivery note or, in the case of hidden defects, within three (3) days after the defects were discovered. After expiration of such period, the Product shall be deemed to have been received in proper condition. Any damage in transit shall immediately be recorded in an appropriate manner.
6.5 The decision as to the justification of a complaint of defects made in due time shall be taken by the Seller.
6.6 In the case of a justified warranty claim, the amount of claim shall be limited to the amount of the invoice for the respective Product and shall be reduced on a pro rata temporized basis according to 6.1.1 to 6.1.4 for each month which has elapsed after start-up and/or delivery, whichever comes first, until the warranty claim is made. If a complaint is justified, the Seller shall meet its warranty obligation at its discretion by:
6.6.1 remedying the defect free of charge, or
6.6.2 refunding the proportionate price corresponding to the warranty period not yet elapsed, or
6.6.3 supplying a replacement to be charged at the price in effect at the time of replacement, less the amount corresponding to the warranty period not yet elapsed.

7 Liability
7.1 Any claim for damages against the Seller shall be limited to the amount of the invoice for the respective Product. In any case, the Seller shall only be liable for damage caused to the Product itself. It is expressly agreed that the Seller shall bear no responsibility for any indirect losses or consequential damages, including, but not limited to, loss of profit or production, mill shutdown or machine operating interruptions, loss or excessive utilization of raw materials or energy, labor costs, claims of customers, cost of capital, property damages and the like.
7.2 To the extent that the Seller's liability is excluded, this shall also apply to the personal liability of the Seller's employees, representatives and servants.
7.3 The Seller shall be neither obliged nor in a position to examine the rolls and parts delivered for processing or repair and shall, therefore, not be liable if defective parts are supplied by the Buyer.
7.4 For damage caused to roll bodies and machine parts supplied by the Buyer, as well as for damage to machine parts caused by the Seller’s employees in the course of measurements and/or installation work on the Buyer’s premises, the Seller shall be liable up to the amount of the current market price only in the case of destruction and/or damage through gross negligence during processing or repair. The roll bodies and machine parts supplied by the Buyer shall be insured to the amount of the current market value against any destruction and/or damage through negligence while being processed or repaired by the Seller. The amount of compensation shall be limited to the amount of the current market price of the roll bodies or machine parts and/or to the maximum amount of insurance under the Seller’s liability insurance contract. Notwithstanding item 9, the Buyer shall, at its own expense, provide insurance cover against such risks like fire, storm, etc.
7.5 The Seller shall, with due diligence, carry out the orders placed with it. If a supplied Product can no longer be used due to faulty treatment, the Seller shall be obliged to process a replacement Product in accordance with the original order. The Seller, however, shall not be obliged to supply a replacement. Unless otherwise agreed, any resulting chips shall become the property of the Seller.
7.6 In addition, the Buyer shall be aware of the fact that nobody is allowed to stay in the paper machine during operation. Consequently, any and all liability of the Seller shall be excluded for events resulting from the presence of a person in the paper machine during operation.
7.7 The limitations of liability stipulated in 7.1 and 7.4 above shall not apply in case of personal injury and in case of property damages caused by gross negligence or intention.

8 Product Liability
8.1 Any Product sold by the Seller shall be as safe as can be expected on the basis of approval requirements, instructions for use and any other rules given by the Seller or the manufacturer.
8.2 The Seller's liability under the PRC Product Quality Law for any damage to property suffered by the Buyer as entrepreneur as well as any product liability claims raised under any other statutory provisions shall be excluded to the extent as legally permitted.
8.3 In the event that the Buyer resells the Products to another entrepreneur, the Buyer shall undertake to also require from such other entrepreneur a waiver in accordance with 8.2 and to oblige such other entrepreneur to demand in turn such waiver in the event of a further resale. If the Buyer fails to demand such waiver, the Buyer shall fully indemnify and hold harmless the Seller in this respect from and against any legal action and reimburse to the Seller all expenses incurred in connection with the liability irrespective of negligence.
8.4 The Buyer shall notify the Seller in writing, promptly and in detail, of any claims raised by third parties having suffered damage caused by Products of the Seller. Again, in the event of resale to another entrepreneur, the Buyer shall pass on this obligation to its client. The same shall apply to the Buyer's obligation to report to the Seller any Product defects as defined under the PRC Product Quality Law.

9 Force Majeure
9.1 If a Party cannot perform its obligations under the contract due to an event of Force Majeure, it shall notify the other Party in writing without undue delay of the occurrence of such an event and provide evidence thereof.
9.2 Force Majeure shall mean any of the following events: earth quake, storm, flood, fire or other acts of nature, epidemic, war, riot, public disturbance, strike or lock outs, government actions or other events beyond the control of the Parties where their occurrence is reasonably unpreventable and unavoidable.
9.3 If an event of Force Majeure occurs, neither Party shall be responsible for any damage, increased costs or losses which the other Parties may sustain by reason of failure or delay of performance. The Party claiming Force Majeure shall adopt measures to minimize or remove the effects of Force Majeure and within the shortest possible time attempt to resume the performance of obligations effected by the event of Force Majeure. If the consequences of such an event cannot be remedied within 6 (six) months from the occurrence, the Parties shall through consultations decide whether to modify or terminate the contract according to the effect of the event of Force Majeure on the performance of the contract.

10 Applicable Law and Arbitration
[Chinese Buyer ]
10.1 These Conditions and the contract shall be governed by the law of the People’s Republic of China.
10.2 Any dispute arising out of or in connection with these Conditions or the contract, which cannot be resolved amicably by the Parties within 30 (thirty) days after the dispute has arisen, shall be finally submitted for arbitration to the China International Trade Arbitration Commission (hereinafter referred to as “CIETAC”), Shanghai Sub-Commission, acting on the basis of its Rules of Arbitration. The arbitration shall be held in Shanghai. The arbitration proceedings shall be conducted in Chinese language.
10.3 The arbitration tribunal shall consist of three arbitrators. Each Party shall appoint one arbitrator and the third arbitrator, who is to act as chairman, shall be appointed by the two first-mentioned arbitrators. If a Party fails to appoint its arbitrator within 1 (one) month after receipt of the notice of arbitration issued by the arbitration tribunal, or if the two first-mentioned arbitrators cannot come to an agreement on the chairman within 1 (one) month after they have been appointed, the respective arbitrator or chairman shall be appointed by the President of the CIETAC, Shanghai Sub-Commission.
10.4 The arbitration award shall be final and binding for the Parties. The arbitration fee shall be borne by the losing party except as otherwise awarded by the arbitration tribunal. During the arbitration proceedings the Parties shall continue to perform these Conditions and the contract except for the stipulations which are in dispute.
[Foreign Buyer ]
10.5 These Conditions and the contract shall be governed by the law of People’s Republic of China.
10.6 Any dispute arising out of or in connection with these Conditions or the contract, which cannot be resolved amicably by the Parties within 30 (thirty) days after the dispute has arisen, shall be finally submitted for arbitration to the Hong Kong International Arbitration Center (hereinafter referred to as “HKIAC”), acting on the basis of its Rules of Arbitration. The arbitration shall be held in Hong Kong. The arbitration proceedings shall be conducted in English language.
10.7 The arbitration tribunal shall consist of 3 (three) arbitrators. The Seller and the Buyer shall each appoint 1 (one) arbitrator. The third arbitrator, who shall act as Chairman and who shall neither be of Chinese nor of the Buyer’s nationality, shall be jointly appointed by the above-mentioned arbitrators. If one Party fails to appoint its arbitrator within 1 (one) month after receipt of the notice of arbitration by the arbitration tribunal or in case the arbitrators fail to reach an agreement on the Chairman within 1 (one) month after they have been appointed, the respective arbitrator or the Chairman shall be appointed by the Chairman of the HKAIC.
10.8 The arbitration award shall be final and binding for the Parties. The arbitration fee shall be borne by the losing party except as otherwise awarded by the arbitration tribunal. During the arbitration proceedings the Parties shall continue to perform these Conditions and the contract except for the stipulations which are in dispute.

11 General Provisions
11.1 The place of performance for the mutual obligations arising from the contractual relationship shall be the Seller’s headquarters. This provision shall also apply if trade terms have been agreed.
11.2 Any declarations made with the intention of establishing, safeguarding or exercising rights shall be made in writing.
11.3 The Buyer may not, without the Seller’s written consent, assign its right under the contract to third parties.