TACH COMPANY NV

GENERAL MANUFACTURING CONDITIONS EFFECTIVE May 16th 2023

1.                   The following general manufacturing terms and conditions (the Manufacturing Conditions) are applicable on every consignment of goods to a third party manufacturer (a Manufacturer) by Tach Company NV (TCNV) acting on its own behalf or as agent on behalf of Tach Securities S.A R.L as the case may be, the Manufacturer acknowledging that it has already agreed to the use of these Manufacturing Conditions in respect of every such consignment. Subject to Condition 4 below, these Manufacturing Conditions supersede any prior written communications and/or agreements and understandings between the parties in respect of the consignment and delivery for polishing of the goods specified in the relevant manufacturing consignment document (Memorandum) and shall apply in preference to and supersede any and all terms and conditions in respect of any order placed by TCNV with the Manufacturer and any other terms and conditions submitted to or by the Manufacturer, including in respect of any goods already on consignment by TCNV to the Manufacturer as at the effective date stated at the top of the first page of these Manufacturing Conditions. TCNV reserves the right to vary these Manufacturing Conditions from time to time on giving the Manufacturer at least 5 business days notice in writing.

2.                   A consignment of goods pursuant to a Memorandum may be effected by TCNV acting (i) on its own behalf as principal and title holder of the relevant goods (Principal Consignment); or (ii) as agent on behalf of Tach Securities S.A R.L as title holder of the relevant goods (Agent Consignment).

3.                   The relevant Memorandum will specify in respect of each consignment of goods whether it is a Principal Consignment or an Agent Consignment. In the event that a consignment of goods includes goods some of which are consigned as a Principal Consignment and some of which are consigned as an Agent Consignment, the relevant Memorandum will specify which goods are being consigned as a Principal Consignment and which goods are being consigned as an Agent Consignment.

4.                   A consignment of goods originally made as a Principal Consignment may subsequently change to being an Agent Consignment in respect of all or part of such goods as a result of a transfer of title to the relevant goods from TCNV to Tach Securities S.A R.L whilst the goods are on consignment with the Manufacturer. In each such case TCNV will send the Manufacturer an updated Memorandum via email confirming in respect of which goods on consignment to the Manufacturer that a transfer of title from TCNV to Tach Securities S.A R.L has taken place.

5.                   Without limitation to any other terms of these Manufacturing Conditions, the Manufacturer accepts that any consigned goods are owned by TCNV or Tach Securities S.A R.L as applicable and are provided to the Manufacturer in accordance with these Manufacturing Conditions solely for the purpose of conducting the manufacturing process in relation to such consigned goods.

6.                   The Manufacturer agrees and acknowledges that under no circumstances may any goods consigned to it, whether under an Agent Consignment or Principal Consignment, be further consigned by the Manufacturer to any other third party.

7.                   The Manufacturer must not cause any damage to the consigned goods, nor any modification whatsoever to the consigned goods other than in accordance with the terms of these Manufacturing Conditions.

8.                   The Manufacturer agrees and acknowledges that any goods specified in a Memorandum as being consigned to the Manufacturer under an Agent Consignment are pledged, charged and/or held to the order of GLAS Trust Corporation Limited in its capacity as Security Trustee.

9.                   The Manufacturer irrevocably confirms that it does not have and will not claim, exercise or enforce any right of set-off, retention, counterclaim or similar right in respect of any goods consigned under a Memorandum (whether under an Agent Consignment or Principal Consignment).

10.               The Manufacturer must at all times following delivery of the goods to it (i) keep the goods consigned to the Manufacturer by TCNV acting as agent on behalf of Tach Securities S.A R.L separately identifiable from any other goods consigned to the Manufacturer by TCNV (acting on its own behalf) or by any other person other than TCNV; and (ii) ensure that the goods consigned to the Manufacturer by TCNV acting on its own behalf or as agent on behalf of Tach Securities S.A R.L remain identifiable and traceable as the property of TCNV or Tach Securities S.A R.L (as the case may be) pursuant to the TCNV serial identification number included on the delivered parcel and/or as stated on the Memorandum. Goods with a weight greater than or equal to 1.80 carats must be kept separately, each with its own serial identification number; goods below 1.80 carats may be kept together under the same serial identification number, as long as they are never mixed with goods sent under a different TCNV serial identification number. The Manufacturer must return goods to TCNV acting on its own behalf or as agent on behalf of Tach Securities S.A R.L, upon request by TCNV or Tach Securities S.A R.L as applicable, irrespective of which stage they are at in the manufacturing process at the time of the request.

11.               The Manufacturer must at all times keep up to date electronic records for the goods, detailing each step of the manufacturing process. All records must be available to TCNV on demand, and the serial identification numbers used in such records must correlate with the TCNV serial identification numbers included on each parcel delivered by TCNV to the Manufacturer. Any and all manufacturing reports and any and all scans of individual stones delivered by TCNV to the Manufacturer must be retained by the Manufacturer for a minimum of 3 (three) years.

12.               All goods delivered by TCNV to the Manufacturer must be analysed by the Manufacturer before being cut and polished or otherwise transformed in any way. For each rough stone with a weight larger than or equal to [1.80] carats, this analysis must provide to TCNV all of the different polished output options for the relevant rough stone including shape, size, colour, clarity and make type. The Manufacturer must await a formal decision in writing (which may be by email) from TCNV with respect to the different output options for every stone before beginning the manufacturing process. For rough stones below [1.80] carats the Manufacturer is to provide to TCNV, as a minimum, an expected output yield before processing begins. During the manufacturing process any forecast deviation of more than 0.2% of expected yield, and/or 1 (one) colour grade difference, and/or 1 (one) clarity grade difference, must be communicated immediately to TCNV in writing (which may be by email), and all manufacturing work on such goods must be paused until a revised manufacturing outcome has been approved by TCNV.

13.               The transfer to the Manufacturer of the risks of loss of or damage to the goods (excluding manufacturing risks) is made as soon as the goods are delivered to the Manufacturer. The Manufacturer must have a [market standard] all-risks insurance policy covering loss of or damage to the goods (excluding manufacturing risks).

14.               When returning manufactured goods to TCNV acting on its own behalf or as agent on behalf of Tach Securities S.A R.L, (i) if it is the intention of the Manufacturer to return part of a consigned parcel or part of a consigned individual rough stone only, the Manufacturer must first request the written approval (which may be by email) of TCNV acting on its own behalf or as agent on behalf of Tach Securities S.A R.L for the value of such goods. This approved value is the only value by which such goods may be returned (excluding manufacturing costs), (ii) when returning a complete parcel and/or the complete products of the manufacturing of an individual rough stone (if that stone has clearly been sent as a separate individual stone on the Memorandum document), the goods must be returned at the value specified by TCNV [in the Memorandum] to the Manufacturer (excluding manufacturing costs), (iii) when returning the final part of a consigned parcel or part of a consigned individual rough stone (the other parts having already been returned), the Manufacturer must ensure that the value of the goods returned (excluding manufacturing costs) is equal to the original value of the parcel or individual stone sent by TCNV to the Manufacturer, less the sum of the values of the parts previously returned of each parcel or individual stone as applicable.

15.               If the Manufacturer fails to return any manufactured goods within 2 (two) weeks of the pre-agreed manufacturing return date, TCNV reserves the right to invoice the Manufacturer. The invoice amount will be equal to the amount stipulated on the Memorandum for the goods, less the value of the goods already returned by the Manufacturer from the relevant parcel(s) (excluding manufacturing costs), plus a 10% fee. In such instance, the manufacturing costs associated with the undelivered goods will not be due whilst the return of the goods, or the payment of the invoice, remains outstanding.

16.               All rough diamond goods sent for manufacturing are self-evidently of natural origin. The Manufacturer warrants that it will use appropriate segregation procedures to maintain separate and identifiable at all times goods consigned to the Manufacturer by TCNV acting on its own behalf from goods consigned to the Manufacturer by TCNV as agent on behalf of the Tach Securities S.A R.L or goods consigned to the Manufacturer by any party other than TCNV, and that consequently no synthetic stone will ever be returned to TCNV. In the event that TCNV is nonetheless in receipt of a synthetic stone from the Manufacturer, the Manufacturer must either (i) replace the synthetic stone with the stone that should have been delivered to TCNV, or (ii) compensate TCNV, on its own behalf or as agent on behalf of the Tach Securities S.A R.L as the case may be, for the market value of the missing stone. TCNV reserves the right to claim further compensation from the Manufacturer for any damages it incurs (on its own behalf or acting as agent on behalf of the Tach Securities S.A R.L), including reputational damage, as a direct result of such contamination of its goods by synthetic stones received from the Manufacturer.

17.               The Manufacturer warrants that it is at all times in full compliance with industry standards and best practices, including, without limitation, that it is RJC (Responsible Jewellery Council) compliant and/ or compliant to any other required standards as communicated to the Manufacturer from time to time by TCNV. The Manufacturer understands the serious implications for TCNV if there is any breach of these standards and commits to inform TCNV immediately upon any breach being discovered, and to resolve such breach as soon as possible. The Manufacturer further agrees to be audited at its own expenses by third parties in order to receive/ update/retain the proper certification (RJC or other as applicable) enabling the Manufacturer to manufacture on behalf of TCNV or Tach Securities S.A R.L as applicable.

18.               These Manufacturing Conditions and the Memorandum in respect of the goods, as applicable, and any non-contractual obligations arising out of or in connection with these Manufacturing Conditions and the Memorandum shall be governed by and construed in accordance with the laws of Belgium. The Parties agree to submit to the exclusive jurisdiction of the courts of Antwerp, Belgium in respect of any dispute arising out of or in connection with these Manufacturing Conditions and/or the Memorandum and/or the consignment of the goods. However, at TCNVs option, proceedings may be brought by the courts and according to the laws of the place where the Manufacturer has its registered office and/or, also at TCNVs option, by the courts and according to the laws of the place where the goods were delivered.

19.               The Manufacturer will be responsible for covering all costs arising from any dispute, including but not limited to legal costs and court fees. Failure by the Manufacturer to acquaint itself with these Manufacturing Conditions in the native language of the jurisdiction of the Manufacturer does not exempt the Manufacturer of their full implementation.

20.               Each of TCNV and the Manufacturer acknowledges that (i) it has all information as referred to in article 5.16 of the Belgian Civil Code; (ii) it has reviewed and agreed to these Manufacturing Conditions on an arms length basis with the other party; and (iii) these Manufacturing Conditions reflect a fair and appropriate balance between the rights and obligations of the parties.

21.               Each of TCNV and the Manufacturer expressly waives, to the fullest extent permitted by law, any right it may have to renegotiate these Manufacturing Conditions or the Memorandum in respect of the consignment of goods solely on the basis of article 5.74 of the Belgian Civil Code.

22.               Each of TCNV and the Manufacturer expressly waives, to the fullest extent permitted by law, any right it may have to terminate these Manufacturing Conditions or the Memorandum in respect of the consignment of goods in the case of an anticipatory breach by the other party.

 

These Manufacturing Conditions are available in English at: https://www.tachediamonds.com/Terms-Conditions.

Deze Productievoorwaarden zijn beschikbaar in het Engels op: https://www.tachediamonds.com/Terms-Conditions.

Les prsentes Conditions de Fabrication sont disponibles en anglais l'adresse suivante https://www.tachediamonds.com/Terms-Conditions