TERM AND CONDITIONS

WHEN CONCLUDING A CONTRACT FOR PRODUCTION

 

I. GENERAL PROVISIONS AND DECLARATIVE PART.

APPLICABILITY OF THE GENERAL TERMS AND CONDITIONS. VALIDITY AND BINDING FORCE OF DOCUMENTS ACCOMPANYING THE MANUFACTURE.

 

Article 1 These General Terms and Conditions represent pre-established provisions and apply when concluding all Contracts for the sale of custom-made products / Manufacturing Contracts / or all Contracts for the sale of finished products from the Seller's list – Contractor.

 

VARNAPACK Ltd., UIC BG203137554, with registered office and management address:

Bulgaria, Varna region, Ignatievo, Agricultural Yard, registered in the Commercial Register of the Varna District Court under file no. 478/2003.

 

referred to hereinafter as VARNAPACK, and the individual or legal entity referred to hereinafter as Client. Client is also the individual or legal entity that commissions VARNAPACK to manufacture specific products. The documents listed in this section govern the relations between the Contractor and the Client in their capacity as Seller and Buyer of the manufactured and received goods.

Article 2 OFFER /PRICE LIST/ – Sample 1 is a written proposal sent via email, fax, or postal service from VARNAPACK to the Client. The offer specifies the packaging offered by VARNAPACK in terms of volume, type, material for production, prices, and discount, which VARNAPACK is obliged to manufacture and deliver if ordered. It is prepared by VARNAPACK.

Article 3 CONTRACT – Sample 3 is any individual Contract for production or Contract for the sale of goods, concluded in writing between VARNAPACK and the Client.

Article 4 ASSIGNMENT PROTOCOL /ORDER – Sample 2 contains the type of production, the type of materials required for the specific production, the quantity, unit price of the items in the production, delivery time, and the details of the authorized persons who place and accept the order. The assignment protocol is prepared at the VARNAPACK office, where it is presented to the Client and signed by the Client – buyer who wishes to place the order. The signing of the Order / Assignment Protocol by the Client can be done either through postal service or at any VARNAPACK office, or by fax at 00359 52 608 722.

Sending and signing the Assignment Protocol /Order/ can also be done through the VARNAPACK website as follows: after the Client has accepted an Offer sent by VARNAPACK, the Client sends the Order to VARNAPACK via the VARNAPACK website at the following address: https://varnapack.com/en/поръчка/ and signs the Order / Assignment Protocol for production. After the Client sends the Order using the "ORDER" button, they unconditionally agree to the present General Terms and Conditions for entering into a production contract.

Article 5 PROTOCOL FOR DELIVERED GOODS – Sample №4:

It certifies the moment of transfer of ownership and serves as the basis for payment by the CLIENT – BUYER. It is an integral part of the invoice for payment in cash or by bank transfer for the works detailed in it. It includes the request number from the CLIENT – BUYER and describes the delivered packaging.

Article 6 RECEIPT AND BANK REMITTANCE – Sample No. 5:

Documents certifying payment for the specific delivery. They are attached to the Invoice. The bank remittance must include the stamp of the bank where the payment was made.

Article 7 The offers, contracts, and assignment/procurement protocols concluded by VARNAPACK are subject to these General Terms and Conditions. All relationships related to the products manufactured and sold by VARNAPACK and their buyers are governed by these General Terms and Conditions. The purchase terms of the Contracting Authority, as well as any unilateral separate agreements, can only be considered if they are accepted and confirmed in writing by VARNAPACK.

VARNAPACK may refuse to conclude a contract or execute an order (Assignment Protocol) in case there are insurmountable obstacles for its execution between the issuance of the offer and its acceptance by the Contracting Authority, including but not limited to: shortage of raw materials on the market, breakdown of technological equipment, strikes, epidemics, and other force majeure circumstances.

Article 8 The parties in a separate written contract may agree on conditions different from the General Terms and Conditions. These conditions are specified in the written contract and are only applicable to the specific order. In these cases, and only for the specific order, if there is a discrepancy between what the parties have agreed upon and the General Terms and Conditions, the agreed terms shall prevail.

Article 9 If a contract has not been signed between the Contracting Authority and the Contractor, these General Terms and Conditions shall have the force of a contract, and all issued and signed offers, orders, protocols, and documents related to the ordered and accepted work shall be applicable according to the provisions of Articles 258-269 of the Obligations and Contracts Act.

The parties – merchants within the meaning of the Commercial Code acknowledge that they are familiar with the provisions of Articles 258 to 269 of the Obligations and Contracts Act regarding the contract for work and agree that for any unresolved issues in these General Terms and Conditions, they shall be governed by those provisions.

Article 10 These General Terms and Conditions are considered established by the Contractor for an indefinite period. Each assignment protocol/order or other document related to the assignment of an order to VARNAPACK signed by the Contracting Authority or an authorized person on its behalf is considered as written confirmation and acceptance of these General Terms and Conditions. The General Terms and Conditions produce legal effect between the parties if the Contracting Authority has not disputed them by the time the manufactured products are delivered to them.

Article 11 VARNAPACK may change these General Terms and Conditions at any time by publishing the current version on the website at: https://varnapack.com/en/поръчка/, as well as in a visible place in every office of VARNAPACK. The latest version accepted by the Contracting Authority shall be legally binding.

 

  II. SUBJECT OF THE CONTRACT

 

Article 12 VARNAPACK undertakes, at its own risk, to manufacture and deliver to the Contracting Authority the products described in detail by type, purpose, quantity, and unit price in the assignment protocol/order signed between the parties.

Article 13 For the products described in the assignment protocol/order, VARNAPACK may, at its discretion, provide upon request from the Contracting Authority ready samples or designs for approval and confirmation of the order within the period stated in the assignment protocol. In addition to ready samples, VARNAPACK may agree that the Contracting Authority approves a sample from the first printed or manufactured products on-site at the Contractor. In such case, the Contracting Authority must send its authorized representative to the VARNAPACK factory at a time specified by VARNAPACK. In case of non-approval of the sample, the order is canceled, and the contract is terminated, with all expenses incurred by VARNAPACK to be paid by the Contracting Authority.

Article 14 The manufacturing shall be carried out using materials from VARNAPACK or materials provided by the Contracting Authority.

Article 15 The subject of the manufacturing may be specified in a separate protocol, where the assigned work is briefly described.

 

III. ALLOWABLE TECHNOLOGICAL DEVIATIONS OF THE PRODUCTS

 

Article 16 Technologically, deviations in colors are possible within the following limits:

1. ΔE*ab = 4 for the printing colors of certain prints. These deviations may be larger when the print is applied to a substrate other than white.
2. ΔE *ab = 8 at the base colors (plastic, paper, etc.).

Article 17 Due to technical reasons, the quantity of produced items may vary from the agreed amount. Unless otherwise stated in the Contract, the Client accepts a deviation of up to 10% from the agreed quantity.

Article 18 The following tolerances are allowed in the thicknesses of the materials from which the items are made:

1. ± 7% for the weight per square meter of the paper.
2. ± (3% + 2 microns) for the thicknesses of BOPP and CPP films.
3. ± (6% + 3 microns) for the thicknesses of HDPE, MDPE, LDPE films.
4. ± (9% + 9 microns) for the thicknesses of films made from recycled materials.

Article 19 The following tolerances are allowed in the linear parameters of the items:

1. ± 0.5 cm for the dimensions of paper boxes, envelopes, and packaging paper.
2. ± 0.7 cm for the dimensions of promotional and gift paper bags.
3. ± 0.5 cm for the dimensions of the bottom of bags.
4. ± 1.0 cm for the dimensions of height and width of bags.
5. ± 0.3 cm for the dimensions of items made from CPP, BOPP.
6. ± 0.8 cm for the dimensions of items made from HDPE, MDPE, LDPE.
7. ± 1.2 cm for the positions of handles, openings, or prints.

Article 20 The following maximum color misalignment tolerances in flexographic printing are allowed:

1. ± 0.1 cm for photorealistic printing.
2. ± 0.3 cm for graphic and line printing.

Article 21 Deviations under Chapter III, Article 19, and Article 20 may be up to twice as large if the items are made from:

1. HDPE, LDPE, or MDPE with a thickness of less than 16 microns.
2. LDPE with a thickness of less than 31 microns.
3. CPP or BOPP with a thickness of less than 21 microns.
4. Semi-extensible and fully extensible paper.

During the processing of the above materials in the manufacturing process, small longitudinal and transverse wrinkles may also occur.

For technological reasons and because the machines used to manufacture the items are not mechanically perfect, 0.3% (zero point three percent) or three items per thousand of the total quantity of items produced by VARNAPACK may have technological deviations in their construction, and this is accepted by the Client as an allowable structural defect.

Article 22 VARNAPACK has the right to add additional small elements in the graphic design of the items (dots, crosses, graphic scales) that do not interfere with the overall appearance of the items, but are technologically necessary for their production.

Article 23 VARNAPACK has the right to place its logo and contact details as the manufacturer or seller of the items on the bottom or in a discrete location on the items, without interfering with their overall appearance.

Article 24 All requirements of the Client regarding packaging, labeling, and other characteristics of the items that differ from the standard ones of VARNAPACK must be specified by the Client in the Order (Assignment Protocol) and the Contract.

 

1.      COMPLAINTS

 

Article 25 Complaints for any defects in the items can be made by the Client within 15 (fifteen) days from their acceptance by the Client. The complaint must be submitted in writing by mail, via fax, or in person at a VARNAPACK office. A Complaint Protocol – Sample No. 6 is drawn up, which is signed by representatives of both parties. Photos and samples of the complained items are attached to the protocol.

The Complaint Protocol is sufficient grounds for accepting or rejecting the complaint. Before accepting or rejecting the complaint, VARNAPACK may send authorized persons to assess the quality of the items and verify the presence of defects that are beyond the standards described in these General Terms or the contract. The Client is obliged to provide access to the items and ensure full cooperation during the inspections of the items. Deviations in dimensions, thicknesses, printing, etc., that exceed the allowable limits, are grounds for a complaint from the Client if at least 5% of the manufactured items have them. To determine the percentage of defective items, a statistical sample is used, which must include at least 10% of the produced items.

Article 26 If VARNAPACK agrees to compensate the Client fully or partially according to the Complaint Protocol, the Client is obliged to return the complained items to the same place where they were received, if VARNAPACK requests this.

Article 27 Unless otherwise agreed in the Contract, all clichés, die forms, and other tools necessary for the production of the items, which have been paid for or provided by the Client, remain with VARNAPACK for up to 14 months after the end of the Contract. If the Client requests them during this period, they can be collected on-site at the factory, warehouse, or office of VARNAPACK. After this period, and unless otherwise agreed, they will be destroyed at the discretion of VARNAPACK.

Article 28 VARNAPACK is not responsible for any unresolved copyright or patent rights on the design of the items ordered by the Client. In this regard, and due to the technical impossibility of checking each order (because of the long timelines and procedures required to verify whether a brand or design is registered by the Client at the relevant Patent Office), VARNAPACK assumes that:

• The Client is a good-faith trader towards the holder, or the Client itself is the holder of the copyright on the design and trademarks of the items ordered for production at VARNAPACK.
• The Client does not infringe the Copyright and Related Rights Act.

By accepting these General Terms and signing the Order / Assignment Protocol or Contract,

THE CLIENT DECLARES, and VARNAPACK considers that the CLIENT is the owner or an authorized user of the trademarks and images on the packaging they order, and that the CLIENT has the right to commission the production of the items they order for manufacturing at the VARNAPACK factory.

In the event of claims from third parties or individuals who hold patents or copyrights on the items ordered by the Client, all costs for potential court fees, punitive awards in favor of any state, institution, individual, or legal entity, fines from the competent court and regulatory authorities, as well as from the Patent Office of the Republic of Bulgaria and international patent organizations for each individual item ordered by the Client in violation of someone’s patent or copyright, shall be borne by the Client.

Article 29 VARNAPACK has the right to keep small quantities of the produced items for their subsequent use as samples in trade exhibitions, catalogs, and other purposes.

 

1. PRODUCTION DEADLINES

 

Article 30 VARNAPACK is obliged to produce and deliver the completed items within the agreed deadline in the Order / Assignment Protocol. If a specific production deadline is not stated in the order, the deadline for fulfilling the specific order is considered to be between 7 and 30 working days, depending on the complexity and quantity of the items ordered for production, as well as the workload of VARNAPACK at the time of the order. Upon acceptance of the completed items by the Client, both parties sign the Goods Transfer Protocol – Sample 4, as described above in these General Terms.

 

The production deadline begins to run from the latest of the following dates:

- the date of signing the Contract or Order / Assignment Protocol;

- the date of receipt by the Client of the advance payment, if such is provided in the Contract / Assignment Protocol;

- the date of approval and signing of the graphic design project for the ordered item by the Client, if such is specified in the Contract / Assignment Protocol;

- the date of provision by the Client of all necessary materials required for the production of the items: texts, photos, samples, and other necessary items, the lack of which hinders the normal production of the items ordered by the Client.

Article 31 In the case of more complex and specific production, the parties agree that the delivery of the completed items will take place according to a schedule approved by both parties.

Article 32 The Client has no right to withdraw from the performance of their obligations under the contract or to terminate it before the expiration of the agreed deadlines for execution.

Article 33 Unless otherwise specified in the Order or Contract, The Client is obliged to pay, withdraw, and accept the completed items from the warehouse of VARNAPACK within 10 calendar days after the production deadline. Failure to comply with this condition is considered a delay on the part of The Client, and they owe a penalty in accordance with Chapter IX of these General Terms, based on the value of the items left in the warehouse of VARNAPACK.

Article 34 If one of the parties delays the fulfillment of its obligation under the Contract, which affects the fulfillment of the other party's obligation, the deadline for the second party's obligation is extended by the time of the delay of the first party.

 

VI. COMPENSATION AND METHOD OF PAYMENT

 

Article 35 For the completed work, The Client is obliged to pay VARNAPACK a fee for the production in the amount agreed upon between the parties according to the unit prices of the types of work described in the Order.

/Assignment Protocol/.

Article 36 The fee / value of the ordered items / according to the Assignment Protocol / Order is final and cannot be changed, including in the case of changes in material prices and labor costs.

Article 37 The fee as per the previous paragraphs, unless otherwise agreed in the Contract, is to be paid as follows:

- 50% - as an advance payment upon signing the Assignment Protocol

- the remaining balance - after VARNAPACK notifies The Client of the exact date when the ordered items will be ready for delivery.

At their discretion, The Client may pay 100% of the fee in advance.

Article 38 The Client is in default if they do not pay before the acceptance of the completed work or from the first day after the payment deadline indicated in the Goods Delivery Protocol, if deferred payment has been agreed.

Article 39 The full amount of the fee is due by The Client even if they refuse to accept the completed work.

Article 40 The fee is to be paid in cash at the VARNAPACK office at the address: Bulgaria, Varna, 108 Devnya St., 1st floor, or via bank transfer to the VARNAPACK account specified in the proforma invoice or payment invoice provided to The Client by VARNAPACK. If The Client is unable to pay via bank transfer, they are obliged to pay in cash.

VII. RIGHTS AND OBLIGATIONS OF THE PARTIES

 

Article 41 VARNAPACK is obliged to:

- to manufacture the agreed items with its own resources and at its own risk;

- to guarantee the quality of the manufactured items;

- to inform The Client of any changes in circumstances that lead to modifications in the execution of the order or make its execution impossible;

- to deliver the completed items to The Client on time.

Article 42 VARNAPACK has the right to:

- to request The Client to accept the completed items;

- to receive the agreed remuneration / the value of the manufactured items;

- to request a modification of the terms set in the Order if its execution is hindered.

Article 43 The Client is obliged to:

– upon request from VARNAPAK, to provide assistance in carrying out the production, by timely providing all graphic materials and the correct assignment for the production of the desired products by the Client;

– to conduct an inspection and accept the completed work within the agreed timeframe;

– to make objections, if any, upon acceptance and to describe the claims in the Complaint Report;

– to pay the agreed remuneration on time and in the agreed manner.

Article 44 The Client has the right:

– to receive the products ordered by him;

– to make objections for defects upon acceptance, if any.

 

VIII. TERMINATION OF RELATIONS UNDER THE GENERAL CONDITIONS AND CANCELLATION OF THE CONTRACT, Order/ Assignment Protocol/

 

Article 45 The established relations between the parties under these General Conditions or in a separate Contract are terminated:

• with the acceptance of the completed work by the Client;
• upon payment by the Client for the completed or delivered work by VARNAPAK;
• in case of objective impossibility to fulfill the task set by VARNAPAK;
• by mutual written agreement between the parties.

Article 46 Each party has the right to terminate the Contract without notice if the other party enters liquidation, insolvency, or if insolvency proceedings are initiated.

 

1. PENALTIES AND GUARANTEES

 

Article 47 If the Client cancels the ordered quantity of products after the production has begun, the Client is obligated to pay the Contractor for the costs incurred and the work performed up to that point, as well as the profit the Contractor would have received from completing the entire order.

Article 48 If the Client is in default regarding the performance, including payment and acceptance of the work done by VARNAPAK, the Client owes a penalty to VARNAPAK in the amount of 0.25% (zero point twenty-five percent) per day on the outstanding amount.

Article 49 If VARNAPAK is in default regarding the performance, including the deadline for the production of the work, it owes a penalty in the amount of 0.25% (zero point twenty-five percent) per day on the amount paid up to the point of default by the Client.

Article 50 VARNAPAK may request from the Client additional commercial securities as a guarantee for payment and acceptance of the completed work: Bill of Exchange, commercial pledge, bank guarantee, surety, mortgage, etc., at its discretion. These forms of securities will be regulated by a separate Annex to the contract.

Article 51 Both parties consider all information made known to them in connection with the performance of the Contract to be confidential. They are obligated not to make available to third parties Offers, prices, graphic designs, and

and any other information made known to them in connection with the conclusion and performance of the Contract.

 

1. FINAL PROVISIONS. DISPUTE RESOLUTION

 

Article 52 All communications and notifications between the parties shall be in writing to be valid. Written form is considered to be complied with in the case of communications by fax and email.

Article 53 The nullity of a clause in the General Conditions or of additional agreed conditions does not lead to the nullity of any other clause or of the General Conditions or the Contract as a whole.

Article 54 The parties are obligated not to disclose to third parties any information received in connection with or as a result of the conclusion or performance of the Contract.

Article 55 For any dispute regarding the existence or validity of these general conditions or in connection with their violation, including disputes and disagreements regarding their validity, interpretation, termination, performance, or non-performance, as well as for any matters not regulated in the General Conditions or in a written Contract, Bulgarian civil and commercial law shall apply, and the parties shall resolve their relations through agreement.

If no agreement is reached, the dispute shall be referred to the Arbitration Court of the Bulgarian Chamber of Commerce and Industry (BCCI) in accordance with the Rules for cases based on arbitration agreements. For any unresolved issues in the Contract, the provisions of the Obligations and Contracts Act and other normative acts of Bulgarian civil legislation shall apply. All disputes related to the interpretation, validity, and performance of the Contract shall be referred to the competent state court at the registered office of VARNAPAK.

Article 56 This updated version of the General Terms and Conditions for the conclusion of a contract for production by VARNAPAK Ltd. is effective from 11.05.2013 and shall remain in force until expressly canceled or replaced.

 

APPROVED BY:

Vasil Vasilev

/Manager of VARNAPAK Ltd./