GENERAL TERMS AND CONDITIONS

General Terms and Conditions of Business of KLOTZ GRASSINGER GROUP of Companies

1. SCOPE OF APPLICATION

(1) The offers and contracts of the companies belonging to the KLOTZ GRASSINGER group of companies (KLOTZ LABS Kosmetikmanufaktur GmbH, KLG CONIUNCTA GmbH, KLG LIQUIDA GmbH and GRASSINGER GmbH, Frauenstr. 44, 82216 Maisach), (hereinafter referred to as "KLG") concerning the development, production, adaptation and delivery of KLG products and concerning further services rendered by KLG are exclusively based on the following General Terms and Conditions ("GTC"). They also apply to all future deliveries, services or offers to the Customer, even if they are not separately agreed again.

(2) These GTC shall apply exclusively. Deviating, conflicting or supplementary general terms and conditions of the Customer will only become part of the contract if and to the extent that KLG has expressly agreed to their validity. This consent requirement applies in any case, for example even if KLG carries out the delivery to the Customer without reservation in knowledge of the Customer's general terms and conditions.

2 CONSTITUTION OF THE CONTRACT

(1) The contract comes into effect with the issuance of a written order confirmation by KLG or with a delivery by KLG initiated by the Customer. Any preceding declarations by the Customer, in particular letters of confirmation, shall only be deemed to be an offer to conclude the contract. Oral promises on the part of KLG prior to the conclusion of this contract are not legally binding and oral agreements of the contracting parties are replaced by the written contract, unless it is expressly stated in each case that they continue to be binding.

(2) Unless otherwise agreed in writing, all offers, the documents belonging to the offers such as product specifications, price lists and other documents of KLG are non-binding. For the definition of the quality of a KLG product or a service to be provided by KLG, only the descriptions in the written order confirmation by KLG are authoritative.

(3) KLG always reserves the right to make changes or adjustments to the KLG Products and, unless otherwise agreed, will inform the Customer of any changes or adjustments at its own discretion.

(4) Unless otherwise agreed, KLG reserves the property rights and copyrights to all submitted offers, cost estimates, recipes, drawings, illustrations, calculations, brochures, catalogs, models, tools and other documents and aids. The Customer may not make these items and documents accessible to third parties, disclose them, use them himself or through third parties, or reproduce them, either as such or in terms of content, without KLG's express consent. At KLG's request, the Customer must return these items in full to KLG and destroy any copies made if they are no longer required by him in the ordinary course of business or if negotiations do not lead to the conclusion of a contract. Excluded from this is the storage of electronically provided data for the purpose of usual data backup.

3. subject matter of the contract

(1) The respective specific subject matter of the contract results from the Customer's order on which the contract is based and the respective corresponding order confirmation by KLG. KLG's services may include in particular:

(a) Delivery of standardized KLG products which do not require individual customization for the respective Customer (hereinafter "Standard Products").

(b) Development, manufacture and delivery of KLG products on behalf of and according to the specifications of the customer, which are distributed and sold by the customer under its own name and brand (hereinafter "Private Label Products").

(c) Development, production and delivery of syntheses and/or method developments according to the Customer's specifications (hereinafter "Custom Synthesis").

(2) The development and delivery of Private Label Products or Customer Syntheses shall be carried out in the agreed time frame on the basis of the product specifications/analysis certificates agreed between the Customer and KLG in accordance with a format specified by KLG. The customer is entitled to change and adapt the product specifications at any time until delivery.

Any change and adjustment require KLG's consent to become effective. KLG will inform the Customer about the possible change of the remuneration and the manufacturing and delivery dates and obtain the Customer's consent thereto. Additional time and costs related to the Customer's changes and adjustments will be charged to the Customer. If the Customer does not agree to the changes, KLG is not obliged to carry out the changes. KLG is entitled to charge Customer for the costs of verifying the feasibility of Customer's change requests.

Customer syntheses are based on preliminary conceptions, which have been prepared to the best of KLG's knowledge on the basis of literature research and KLG's own experience in synthesizing similar molecules. Nevertheless, there remains a residual risk that the intended custom synthesis is not successful and that the target molecule cannot be produced or cannot be produced in the notified quantity or purity. If the agreed target can only be achieved with considerably higher effort, the previous paragraph shall apply accordingly. If the Customer does not agree to the adjustments, KLG is entitled to withdraw from the contract and to invoice the services rendered until the withdrawal.

(3) The risk of suitability and use is exclusively incumbent on the Customer. The occurrence of a certain economic success, unless expressly agreed otherwise, is not owed.

(4) KLG is entitled to terminate the contract after the expiry of a reasonable deadline set by KLG in the event of non-fulfilment of cooperation obligations on the part of the client. In addition, KLG is entitled to invoice the client for any additional expenses incurred.

(5) KLG is entitled to invoice orders in due time if the client fails to comply with the deadlines set for the provision of materials.

(6) KLG is entitled to invoice any additional expenses incurred due to unforeseeable or unannounced circumstances in connection with the provision and processing of third-party materials.

(7) KLG is entitled to use suitable subcontractors of its own choice and at its own discretion for the fulfillment of partial tasks of the overall order.

(8) KLG is entitled to use surrogates insofar as a similar chemical and physical quality exists.

(9) KLG is entitled to invoice services already rendered or to be rendered within the scope of the notification of readiness to deliver. Readiness to deliver means that KLG can invoice order-related services that are not directly subject to customer cooperation at any time. This includes unfinished products (semi-finished products without the possibility of completion on the part of KLG).

(10) KLG is entitled to name the customer as a reference customer, stating his company name.

4. remuneration, reimbursement in the event of termination

(1) Unless otherwise agreed in writing, the remuneration shall be understood as net prices ex works plus statutory value added tax. Any special payments in connection with the payment of the remuneration (e.g. bank charges, currency exchange fees, etc.) shall be borne by the customer. The remuneration is to be understood in Euro. Return of packaging and disposal of packaging shall be agreed separately.

(2) If the Customer makes use of his right of termination according to Section 648 of the German Civil Code (BGB), KLG may, instead of the claims resulting from Section 648 of the German Civil Code (BGB), invoice the services performed up to the termination and, in addition, demand a lump sum amounting to 10% of the remuneration for the services not yet performed as compensation for other expenses and lost profit. The Customer's right to prove that the damage incurred by KLG pursuant to Section 648 BGB is significantly lower than the lump sum or that KLG has not incurred any damage at all remains unaffected.

5. terms of payment

(1) The agreed total price or partial payments thereon shall be invoiced in accordance with the agreed payment schedule.

(2) Payments shall be made within 14 days after receipt of the invoice without deduction. KLG is entitled to issue invoices electronically, unless otherwise agreed. The Customer may request the issuance of physical invoices at any time.

(3) KLG shall pay within a period of 60 days after receipt and inspection of goods or after Verification of the provision of Services. 

(4) In the event of default in payment, the statutory consequences of default shall apply.

(5) Compliance with contractually agreed development, production and delivery deadlines is subject to the Customer's fulfillment of the agreed cooperation or advance performance obligations and other contractual obligations. If the Customer is in default with the performance of its cooperation or advance performance obligations as well as its other contractual obligations, in particular also payment obligations from previous contractual relationships, KLG may refuse further performance of the service.

(6) Offsetting or retention on the part of the Customer shall only be permissible due to undisputed or legally established counterclaims of the Customer.

(7) KLG is entitled to assign claims against Buyers located in Germany and countries of the EU to abcfinance GmbH, Kamekestr. 2-8, 50672 Cologne, Germany, for refinancing purposes. The purchaser will be informed at the time of conclusion of the contract whether an assignment of the claim will take place. In these cases, payments with debt-discharging effect can only be made to abcfinance GmbH. The buyer will be informed of the bank details of abcfinance GmbH upon conclusion of the contract.

(8) KLG reserves the right to make claims and agreed payment terms due immediately in the event of changes or insufficient creditworthiness of the Customer or, in order to ensure the ability to continue as a going concern, to at one's own discretion to change.

6. DELIVERY, PERFORMANCE TERMS

(1) Delivery shall be EXW (Incoterms 2020), unless expressly agreed otherwise. In the case of import into non-EU countries, the customer shall also be responsible for organizing the import. Any import restrictions to the place of delivery requested by the Customer shall be borne by the Customer.

(2) All deadlines stated by KLG, in particular development and delivery dates, are only binding if they are expressly designated as binding by KLG. The expiry of binding deadlines entitles the Customer to assert the statutory rights to which he is entitled - subject to the corresponding restrictions in these GTC - but only after the unsuccessful expiry of a reasonable remedy period set by him.

(3) KLG shall not be liable for impossibility of delivery or for delays in delivery, insofar as these are caused by force majeure or other events not foreseeable at the time of conclusion of the contract (e.g. (3) KLG shall not be liable for impossibility of delivery or for delays in delivery caused by force majeure or other events unforeseeable at the time of conclusion of the contract (e.g. operational disruptions of any kind, difficulties in procuring materials or energy, transport delays, epidemics and pandemics, strikes, lawful lockouts, shortage of labor, energy or raw materials, difficulties in procuring necessary official permits, official measures or the failure of suppliers to deliver or to deliver correctly or on time) for which KLG is not responsible.

If such events make the delivery or service considerably more difficult or impossible for KLG and the hindrance is not only of temporary duration, KLG is entitled to withdraw from the contract. In the case of hindrances of temporary duration, the delivery or service deadlines will be extended or postponed by the period of the hindrance plus a reasonable start-up period. If the Customer cannot reasonably be expected to accept the delivery or service as a result of the delay, he can withdraw from the contract by immediate written declaration to KLG.

(4) KLG is entitled to make partial deliveries if

- the partial delivery is usable for the Customer within the scope of the contractual purpose,

- the delivery of the remaining goods is ensured and

- the Customer does not incur significant additional expenses or costs as a result (unless KLG agrees to bear these costs).

7. TRANSFER OF RISK

(1) The risk shall pass to the Customer at the latest upon handover of the item to the warehouse, forwarder, carrier, other third party designated to carry out the shipment or the Customer itself, whereby the start of the completion notification, booking-in process or loading process shall be decisive. This also applies if partial deliveries are made or KLG has assumed other services (e.g. shipping). If the shipment or the handover is delayed due to a circumstance the cause of which lies with the Customer, the risk shall pass to the Customer from the day on which the goods are ready for delivery and KLG has notified the Customer of this.

(2) If delivery is delayed at the Customer's request, the risk shall pass to the Customer from the day of notification of readiness for shipment.

(3) Storage costs after transfer of risk shall be borne by the Customer. In case of storage by KLG, the storage costs shall amount to 0.25% of the invoice amount of the delivery items to be stored per expired week. KLG reserves the right to claim and prove further or lower storage costs.

(4) KLG will insure any deliveries against theft, breakage, transport, fire and water damage or other insurable risks only upon the Customer's express written request and at the Customer's expense.

(5) Insofar as the contractually agreed services require acceptance, the product is deemed to be accepted if

- the delivery has been completed,

- KLG has notified the Customer of this with reference to the acceptance fiction according to this paragraph (5) and has requested the Customer to accept the product,

- twelve working days have passed since the delivery of the development result or the Customer has started to use the KLG product (e.g., has started to distribute the product).e.g. has started to distribute the product or uses the product in the context of its own production) and in this case six working days have passed since delivery, and

- the Customer has failed to accept the KLG Product within this period for a reason other than a defect notified to KLG which makes the use of the KLG Product impossible or significantly impairs it.

8. retention of title, prohibition of assignment

(1) KLG retains title to the delivered KLG Products until full receipt of the contractually agreed payments on KLG's claims arising from the underlying contract (delivery of KLG Products) and any business relations with the Customer concerning similar KLG Products preceding this contract, including statutory claims. The Customer is obliged to mark the KLG Products not yet in his ownership accordingly.

(2) The Customer may use the KLG Products subject to retention of title and resell them in the ordinary course of business as long as the Customer is not in default of payment. However, the Customer may not pledge the KLG Products subject to retention of title or assign them by way of security. The Customer hereby assigns to KLG in full, by way of security, the Customer's claims for payment against its customers from a resale of the KLG Products subject to retention of title as well as those claims of the Customer with regard to the KLG Products which arise for any other legal reason against its customers or third parties (in particular claims in tort and claims for insurance benefits), including all balance claims from the current account.

(3) The Customer may collect these claims assigned to KLG for his account in his own name on behalf of KLG as long as KLG does not revoke this authorization. This does not affect KLG's right to collect these claims itself; however, KLG will not assert the claims itself and will not revoke the authorization to collect as long as the Customer duly meets its payment obligations.

(4) However, if the Customer behaves in breach of contract - in particular if he is in default with the payment of a claim for remuneration - KLG can demand from the Customer that he informs KLG of the assigned claims and the respective debtors, notifies the respective debtors of the assignment and hands over all documents to KLG and provides all information that KLG requires to assert the claims.

(5) Any processing or transformation of the KLG products subject to retention of title by the Customer is always carried out for KLG. If the KLG products subject to retention of title are processed with other items that do not belong to KLG, KLG acquires co-ownership of the new item in the ratio of the value of the KLG product (final invoice amount including VAT) to the other processed items at the time of processing. In all other respects, the same applies to the new item created by processing as to the KLG products subject to retention of title.

If the KLG products subject to retention of title are inseparably combined or mixed with other items not belonging to KLG, KLG shall acquire co-ownership of the new item in the ratio of the value of the KLG products subject to retention of title (final invoice amount including value added tax) to the other combined or mixed items at the time of combination or mixing. If KLG products are combined or mixed in such a way that

the Customer's item is to be regarded as the main item, the Customer and KLG agree already now that the Customer shall transfer co-ownership of this item to KLG on a pro rata basis.

(6) If KLG withdraws from the contract in the event of conduct by the Customer in breach of contract, in particular in the event of default of payment, KLG is entitled to take back the KLG products not yet owned by the Customer at the Customer's expense and/or to claim damages from the Customer. Further claims of KLG remain unaffected by this.

(7) In the event of seizures, confiscations or execution measures by third parties, the Customer must notify KLG immediately in writing.

The costs of asserting and enforcing KLG's claims with regard to KLG products not yet owned by the customer shall be borne by the customer.

(8) Insofar as the value of the existing securities exceeds the claims of KLG against the customer from the underlying contract and any business relationships preceding this contract concerning similar products between KLG and the customer by more than 10 %, KLG is obliged, at the request of the customer, to release corresponding securities at the discretion of KLG.

9. WARRANTY

(1) The subject matter of the contract is exclusively the KLG product with the properties and features as well as the intended use in accordance with the individual contractual agreement and the product specification or the certificate of analysis [Clause 3 (2)] on which the individual contract with the customer is based. There is no defect and the warranty is excluded if and insofar as

- the defect is due to the fact that the KLG products are not transported and/or stored protected from light, or

- the defect is due to the fact that the KLG products are not transported and/or stored at the recommended room temperature of 15 to 25°C, or

- the defect is attributable to primary and secondary packaging materials provided by the customer, or

- the KLG products have been outside KLG-controlled or KLG-certified warehouses for more than three months, or

- the KLG products are further processed by a third party without prior consent, or

- the KLG products show segregation phenomena such as sedimentation and/or creaming due to the raw materials, or

- the KLG products contain traces of other raw materials usable according to EC/1223/2009 and DIN EN ISO 22716 due to technical reasons, or

- the raw materials regulated as marketable by KLG according to EC/1223/2009 and DIN EN ISO 22716 are not recognized by third parties, or

- the KLG products have been modified in the course of technical progress or internal process changes, or

- the KLG products show variations in actuators according to EC/1223/2009 and DIN EN ISO 22716 such as buffers and/or gel formers,

- the KLG products contain surrogates of similar chemical and physical properties,

- KLG products have been adapted to ensure delivery capability and safety.

(2) Other or more extensive properties and/or characteristics and/or a purpose of use beyond this shall only be deemed agreed if they are expressly confirmed by KLG in writing. Unless otherwise contractually agreed between KLG and the Customer, enclosed product descriptions as well as the individually agreed quality do not constitute an assumption of a quality or durability guarantee within the meaning of § 443 BGB or § 639 BGB.

(3) KLG reserves the right to deliver 10% more or less than the order quantity due to manufacturing and material-specific features. Differences in quantity will be compensated within the scope of a follow-up order.

(4) The Customer is obliged to carefully inspect the delivered KLG product immediately after delivery to him or to the third party designated by him. The respective product shall be deemed approved by the Customer with regard to obvious defects or other defects that would have been recognizable in the course of an immediate, careful examination, if KLG does not receive a written notice of defect within five working days after delivery. With regard to other defects, the KLG products are deemed to have been approved by the Customer if the notice of defect is not received by KLG within five working days after the time at which the defect became apparent; if the defect was already apparent to the Customer at an earlier time during normal use, however, this earlier time is decisive for the beginning of the period for giving notice of defects. At KLG's request, a KLG product which is the subject of a complaint must be returned to KLG carriage paid. In case of a justified complaint, KLG will reimburse the costs of the most favorable shipping route; this does not apply if the costs increase because the KLG product is located at a place other than the place of intended use.

(5) In the event of material defects of the delivered KLG Product, KLG shall first be obliged and entitled to rectify the defect or to make a replacement delivery at its discretion within a reasonable period of time. In case

of failure, i.e. impossibility, unreasonableness, refusal or unreasonable delay of the rectification or replacement delivery, the Customer may withdraw from the contract or reasonably reduce the purchase price.

(6) KLG is entitled to refuse non-performance altogether if it is only associated with disproportionate costs or is impossible for other reasons. Further rights of the Customer remain unaffected.

(7) The warranty period is one year and begins with the delivery to the Customer or another recipient named by him or from the time of acceptance, if and to the extent that acceptance is required. This period does not apply to claims for damages of the Customer arising from injury to life, body or health or from intentional or grossly negligent breaches of duty by KLG or its vicarious agents, which shall be time-barred in each case in accordance with the statutory provisions.

(8) KLG products may be products that require official approval. It is the Customer's responsibility to obtain any necessary official approvals/certificates and to inquire about the requirements in advance of an order and to inform KLG about them. KLG does not guarantee that the KLG products, in particular the private label products or custom syntheses, meet the requirements of an official approval.

10. LIABILITY

(1) In case of intent and gross negligence, KLG is liable without limitation.

(2) In the case of simple negligence, KLG shall only be liable

a) for damages resulting from injury to life, body or health,

b) for damages resulting from the breach of an essential contractual obligation (i.e. an obligation the fulfillment of which makes the proper performance of the contract possible in the first place and the observance of which the contracting partner regularly relies on and may rely on); in this case, however, liability shall be limited to compensation for the foreseeable, typically occurring damage. The limitations of liability resulting from the above sentence do not apply if KLG has fraudulently concealed a defect or has assumed a guarantee for the quality of the goods. The same applies to claims of the Customer under the Product Liability Act.

Any further liability of KLG is excluded.

(3) Insofar as KLG provides technical information or acts in an advisory capacity and this information or advice is not part of the contractually agreed scope of services owed by it, this is done free of charge and to the exclusion of any liability.

11. CLARIFYING NOTES ON INSURANCE COVERAGE AND REGULATORY NOTES

(1) In the event of an indemnity agreement, reference is made to the following clause from the insurance contracts between KLG and AXA Versicherung AG with regard to the scope of insurance cover for KLG's services and products: "Insurance cover is provided for the indemnity agreed by the policyholder in favor of his customer or client against claims for damages by third parties due to personal injury, property damage or resulting financial losses caused by products manufactured or delivered by the policyholder or by work performed or other services rendered by the policyholder. The prerequisite is that the claim is due to a defect which already existed at the time when the product left the control of the policyholder or when the policyholder completed his work and/or services. If there is contributory negligence/causation on the part of the customer or client benefiting from the declaration of indemnity, insurance cover shall only exist for the declaration of indemnity to the extent that this corresponds to the share of negligence/causation of the policyholder, even if the agreement should stipulate otherwise. The indemnified company does not acquire any direct claims against AXA Versicherung AG."

(2) It is the Customer's responsibility to provide suitable insurance cover for possible claims made against him by his customers, insofar as the claim is due to errors in his area of responsibility.

(3) Furthermore, KLG points out that the insurance coverage applies exclusively within the European Union. If and insofar as the Customer intends to distribute KLG products outside Europe, he will inform KLG of this at the latest when placing the order and obtain KLG's consent. Distribution of KLG products outside Europe is not permitted without KLG's consent.

12. PROPRIETARY RIGHTS AND INFRINGEMENTS

(1) All existing registered and unregistered property rights and know-how shall remain with KLG. This also applies to any property rights and know-how arising during the development and production of private label products or customer syntheses. The Customer is not entitled to use any information provided to him which concerns registered and non-registered property rights and know-how of KLG for purposes outside this contract (e.g. own production).

(2) If, after effective conclusion of the contract between KLG and the Customer, infringements of property rights are asserted against the Customer by third parties and if the use of KLG products is impaired or prohibited as a result, KLG will, within a reasonable period of time, at its own discretion, modify or replace the KLG products in such a way that they no longer affect the property rights of third parties but nevertheless comply with the contractually agreed quality. Instead of the aforementioned procedure, KLG is entitled to rescind the contract concluded with the Customer and to take back the KLG Products against reimbursement of the remuneration paid by the Customer after deduction of an appropriate value replacement for products that cannot be returned.

(3) If claims are made against the Customer by third parties due to an alleged infringement of property rights by KLG products, the Customer shall leave the sole decision on the conduct of disputes resulting therefrom to KLG. In particular, the Customer may not conclude any settlement or make any other concessions without KLG's prior written consent. KLG will bear the entire costs of any legal dispute that may become necessary.

(4) KLG is not liable for infringements of property rights if KLG products have been used in a form not authorized by KLG.

(5) The Customer guarantees that specifications provided by him do not infringe any third party property rights. If claims are asserted against KLG by third parties in this context, the Customer is obliged to indemnify KLG against claims of third parties for infringement of property rights, insofar as these claims of third parties are attributable to the Customer's specifications.

13. secrecy

The Customer is obliged to keep secret all information made available to him or of which he becomes aware in connection with the contract, including information about the nature of the KLG products and about analytical, development, synthesis and process technology.

14. CONCLUSIONS

(1) In case of doubt, the provisions of these GTC shall remain binding in their remaining parts even if individual provisions are legally invalid. The parties undertake to replace invalid provisions with provisions that come as close as possible to the intended economic success. The same shall apply to any loopholes in the contract.

(2) Amendments or supplements to these General Terms and Conditions as well as confirmed orders must be made in writing. This shall also apply to any amendments to this written form clause.

(3) The contract concluded between the parties shall be governed exclusively by the laws of the Federal Republic of Germany to the exclusion of the UN Convention on Contracts for the International Sale of Goods (CISG).

(4) In the event of disputes in connection with the contract concluded between the parties, the Cologne Regional Court shall have exclusive jurisdiction. Notwithstanding the foregoing, KLG remains entitled to bring an action at the Customer's general place of jurisdiction.

(5) KLG is entitled, at its own discretion, to have disputes arising from or in connection with the Contract, including all questions regarding its existence, validity or termination, decided by arbitration in Paris in accordance with the Rules of Arbitration of the International Chamber of Commerce ("ICC") instead of by ordinary courts. The arbitral tribunal shall consist of 3 arbitrators. The language of the arbitration shall be English. In case of an intended filing of an action by the Customer, KLG shall be obliged, upon request of the Customer, to make a choice on the recourse to arbitration within a reasonable period of time set by the Customer. If KLG does not make a decision within the reasonable period of time set by the Customer or if KLG decides not to refer the matter to arbitration, KLG's right to refer the matter to arbitration shall expire.

End of GTC. 14.05.2018.