General Trade Terms and Conditions for Wood Pulp Sales

							               General Trade Terms and Conditions for Wood Pulp Sales

1. GENERAL. These General Trade Terms and Conditions for Wood Pulp (“General Terms and Conditions”) shall apply
   to all purchases of wood pulp and/or related services (collectively, the “Product”) made between a customer (as
   identified in the agreement incorporating these General Terms and Conditions or to which these General Terms and
   Conditions are attached, the “Buyer”) and Neucel Specialty Cellulose Ltd. (the “Seller”) (collectively, the “Parties”)
   unless otherwise agreed in writing by the Seller. These General Terms and Conditions are subject to change by the
   Seller without prior written notice to, or the consent of, the Buyer.

2. ORDERS. (a) Purchase orders shall be made by the Buyer in writing and confirmed by the Seller in writing and may
   be filled in whole or in part at the discretion of the Seller. All verbal communications and/or arrangements shall be
   confirmed in writing. Each purchase order to be accepted by the Seller shall be confirmed within fourteen (14)
   business days of its issuance. Each purchase order shall be numbered (the “Neucel Order Number”) and such number
   shall be referenced in any communications or documentation in respect of the order. Subject to sections 04 and 13
   below, each shipment under a purchase contract providing for more than one shipment shall be considered a separate
   contract and default on one or more shipments shall not invalidate the balance of the contracted shipments under the
   purchase contract except as otherwise provided herein or in the purchase contract.

   (b) Prices will be determined as agreed in writing between the Parties from time to time prior to shipment. Unless
   otherwise agreed in writing, all amounts payable in respect of sales of Product are in US dollars. In the event the terms
   of payment include payment by letter of credit, each letter of credit shall include reference to the name of the Buyer, the
   Neucel Order Number, the order date, the Product specified in the order, the confirmed price, the shipment date, the
   freight terms and the place of destination. The Buyer shall deliver such Letter of Credit to the Seller ten (10) business
   days, prior to the loading date. Invoices in respect of Product orders shipped (in whole or in part) shall be issued by
   Seller upon shipment.

3. QUANTITY; WEIGHT AND MOISTURE. (a) Unless otherwise agreed in writing, all quantities shall be stated in Air
   Dried Metric Tons (“ADMT”) and the word tonne or ton shall mean 1,000 kilograms or 2204.62 pounds air-dry mass
   including the usual packaging materials. As applied to wood pulp the term air-dry shall mean ninety per cent (90%)
   oven dry pulp and ten per cent (10%) water.

   (b) The Product shall be packed in bales of declared uniform weight and air-dry content or rolls with dimensions as set
   out in the purchase contract as agreed by the Seller. The weight and air-dry content and number of each bale or roll
   will be recorded. Each bale or roll shall bear a number or other identification mark to enable the time of manufacture to
   be determined by the Seller in case of need.
4. QUANTITY; MARGIN. For the convenience of shipping, a margin of ten percent (10%) more or less on the quantity of
   any contracted purchase is allowed. When two or more shipments are made under the same purchase contract, the
   margin for the total quantity contracted for may not exceed ten per cent (10%) of what is due to be shipped with the last
   vessel to fulfil the purchase contract.

5. QUANTITY; DISPUTES ABOUT AIR-DRY QUANTITY. (a) Should the Buyer dispute the air-dry content of the Product
   invoiced, it must do so within a time limit of thirty (30) days after the discharge of the Product at the place of destination
   and base its claim on a test which must show a difference of more than one percent (1%) in the air-dry quantity of
   Product. That being the case the Buyer may submit its claim to the Seller and at the same time furnish the Seller with
   the details of the Buyer’s test and with at least two names of suitable and competent analysts. If at the time there exists
   a valid list of analysts approved by the trade associations of the Parties, the analysts shall in the first place always be
   chosen from that list.
   (b) If the Parties fail to agree on the exact quantity within seven (7) days of the Seller receiving the claim
   and the details of the test, a retest shall take place as soon as the Seller has chosen one of the Buyer’s proposed
   analysts. If the Seller has not made his choice within fifteen (15) days of the receipt of the names, the
   Buyer shall have the right to appoint one of the proposed analysts.

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   (c) The retest shall be made in accordance with existing ISO recommendations, or for grades not
   covered by such recommendations, according to a method agreed on between Buyer and Seller. The
   Seller shall have the right to be represented at the retest. Not less than one half (1/2) of the consignment
   in dispute shall be available for the retest otherwise no claim can be established. If the difference in the air-dry quantity
   of Product does not exceed one per cent (1%), as compared with the original invoice, the invoice shall
   stand as originally rendered. The analyst’s findings shall be final and all expenses incidental to the retest
   shall be paid by the Party in error.

   (d) The Buyer shall, however, in any case pay the invoice in respect of the consignment in dispute when due. Final
   adjustment shall be made when the retest is completed and according to the result of the same.

6. QUALITY AND PRODUCT SPECIFICATIONS. (a) Seller warrants that the Product will be manufactured by Seller and
   will meet the specifications herein agreed by the Parties (as same may be amended or otherwise be agreed by the
   Parties in writing from time to time). For each shipment of Product, Seller shall provide to Buyer a Certificate of
   Analysis evidencing the Product’s conformance to such specifications.

   (b) These warranties are the Seller’s sole warranties with regard to the Product and are expressly in lieu of any
   express or implied condition or warranty of fitness, merchantability or suitability. The Buyer represents that it is familiar
   with the characteristics, qualities and uses of the Product and that, other than as set out in clause 6(a) above, the Buyer
   is not relying on the Seller’s skill or judgement to select or furnish the Product suitable for any particular purpose. The
   Buyer assumes all risk and liability for use of the Product, whether alone or in combination with other materials. Other
   than as set out in clause 6(a) above, THE SELLER MAKES NO REPRESENTATIONS OR WARRANTIES, EXPRESS
   OR IMPLIED BY OPERATION OF LAW OR OTHERWISE, INCLUDING BUT NOT LIMITED TO, ANY WARRANTY
   AS TO MERCHANTABILITY OR FITNESS OF THE PRODUCT FOR ANY PARTICULAR PURPOSE. Without liablity to
   the seller, regular technical exchanges maybe coordinated between the Buyer and the Seller to facilate any possible
   process or quality improvements that maybe identifed and agreed to by both Parties from time to time.

   (c) Should the Buyer dispute the quality of the Product delivered hereunder, unless otherwise agreed in writing, the
   Buyer must do so within the time limit of thirty (30) days after the discharge of the consignment of Product at the place
   of destination and within the same time state its claim as well as furnish the Seller with the facts on which it is basing
   the said claim.
   (d) If the Buyer has made its claim as specified above and the Parties cannot reach a settlement of the dispute, the
   matter shall be referred to arbitration. Not less than eighty percent (80%) of the consignment under dispute shall be
   available for the drawing of samples, which can be determined by the arbitrators otherwise no claim can be established.

   (e) Should the Product delivered hereunder be found on arbitration not to conform with the quality of
   the Product according to the specifications contracted for, but usable nevertheless by the Buyer in its normal
   production, the arbitrators shall award an adequate allowance to the Buyer. Should the Product be found not to be
   usable by the Buyer in its normal production, the arbitrators shall award rejection. The arbitrators shall, however, be
   entitled to award rejection only if there remains in tact eighty per cent (80%) or more of the consignment in question.

   (f) In the event of an award of rejection or of an allowance of twenty per cent (20%) or more of the contracted price of
   the Product on account of quality having been made in favour of the Buyer under this clause on two successive
   consignments of Product having the same specifications, the Buyer shall have the right to (i) in the case where only one
   type of wood pulp has been contracted for, cancel all future deliveries contracted for or (ii) in the case where more than
   one type of wood pulp has been contracted for, cancel all future deliveries of the type of Product which is the subject of
   the award.

   (g) The Buyer shall promptly unload and properly store and cover by insurance any shipment made to the Buyer
   pending a decision of the dispute.

   (h) The Buyer shall in any case pay the invoice when due. Final adjustment shall be made when the decision of the
   arbitrators is given and according to the result of the same.

   (i) The arbitrators’ findings shall be final and binding on the Parties and all costs and expenses incidental to the
       arbitration shall be paid by the Party in error.




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7. DELAYED PAYMENT AND OWNERSHIP OF GOODS. (a) If the Buyer delays payment when the price is payable in a
   currency other than that of the Seller’s country, the Seller is entitled to compensation of the difference if the rate of
   exchange is less favourable to Seller on the day of actual payment than it was on the last day when payment was due.
    (b) If the Buyer is in default of payment and the delay is not attributable to errors by transferring banks, the
   Seller shall have the the right to cancel any purchase contract between the Parties with effect fourteen (14) days after
   giving notice if the payment has then still not reached the Seller. In the case of a purchase contract providing
   for more than one delivery such cancellation applies to the balance of such order including or not including, as the
   Seller so elects, the shipment for which the Buyer is in default of payment.

   (c) Delivered Product shall, to the extent permitted by the law of the Buyer’s country, remain the property of the
   Seller until the whole sum payable under the contract to which the delivery relates is paid. The ownership of
   the Product includes the right to the goods as delivered or adapted and the right to the receivables which the Buyer
   may have acquired from disposing of the Product or products made thereof.

   (d) Should the Buyer default in making any payment under the terms of a purchase contract, the Seller shall have
   the right to withhold deliveries under such contract and any other purchase contract between the parties until payment
   is made upon giving notice to that effect to the Buyer.

   (e) Should either the Buyer or the Seller become insolvent or go into liquidation or have a receiver appointed or
   otherwise be found to be in such a financial position that it may reasonably be assumed that it will not be able to fulfil its
   obligations (the “Defaulting Party”), the other Party shall have the right to cancel all purchase contracts between the
   Parties if the Defaulting Party has not within ten (10) days after being given written notice furnished a satisfactory
   guarantee for its fulfillment of any such contract.

8. LIMITATION OF LIABILITY. Notwithstanding any other provision contained herein, the Seller’s maximum liability to
   the Buyer on any claim of any kind for any loss or damage arising out of or in connection with or resulting from the
   purchase of Product by Buyer from Seller or from the performance or breach of this agreement shall be limited to the
   purchase price of the Product with respect to which such matter arises or claim relates.

   (b) Notwithstanding any other provision contained herein, neither Party nor its affiliates, nor it or its affiliates’ respective
   directors, officers, employees, agents, contractors or subcontractors shall be liable to the other Party or its affiliates, or
   its or its affiliates’ respective directors, officers, employees, agents contractors or subcontractors, for any indirect,
   incidental or consequential damages that may be suffered or incurred by any such Party, including but not limited to
   costs or claims arising from third party contracts, down time, lost production time, or business interruption. The
   limitations on, and releases from liability expressed herein shall apply regardless of how caused and under any theory
   of liability, including without limitation, negligence (in whole or in part), strict liability, breach of contract, default or
   otherwise of the Party whose liability is limited and shall extend to its affiliates and its and their directors, officers and
   employees and shall survive termination of any agreement between the Buyer and Seller for any reason.

   (c) If the Product delivered pursuant to this agreement is found lacking in quality and a rejection of the faulty Product is
   agreed or awarded by arbitration, the Seller is under the obligation without undue delay to replace the faulty Product at
   its own expense and reimburse the expenses that the Buyer may have incurred in receiving, storing and reloading the
   faulty Product but is not otherwise liable to pay compensation or damages of any kind because of the defect. When
   there is a lack of quantity or a defect in quality of the Product delivered hereunder for which no rejection is awarded or
   agreed, the Seller shall reimburse the Buyer for the Product not delivered or an amount in recognition of the reduced
   value of the Product delivered; provided that in any such case the Buyer shall not otherwise be compensated and is not
   entitled to damages.

   (d) Any Party alleging a breach of contract by the other Party must take all necessary measures to mitigate the loss
   resulting from the breach, provided that and in so far as it can do so without unreasonable inconvenience or cost. If the
   Party alleging the breach fails to take such measures, the Party in breach may claim a reduction in the damages.

9. INDEMNIFICATION. Subject to any limitations set forth iherein, each Party agrees to indemnify, hold harmless and
   defend the other Party (and such Party’s affiliates, subsidiaries, shareholders, directors, officers, employees, and
   servants and agents of each of them) from and against any and all actions or causes of action, claims, demands,
   liabilities, losses, damages, or expenses of whatsoever kind or nature (including, without limitation, attorneys’ fees),
   which the other Party may suffer or incur by reason of (i) bodily injury, including death, to any third party, (ii) damage or
   destruction of any third party’s property, including the loss of use thereof, (iii) environmental damage, arising out of or in
   any way connected herewith, (iv) any breach of, or default under, this agreement (including, without limitation, any
   breach of, or default under, these General Terms and Conditions) or (v) any breach of duty or negligence of a Party, or
   otherwise.
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10. DELIVERY AND TITLE. Product will be delivered on the basis of the agreed Incoterms 2000 at the place of
   destination set out in the relevant purchase contract or as otherwise agreed in writing from time to time. Title and
   ownership and risk of the Product sold pursuant to this agreement shall pass from Seller to Buyer upon delivery of the
   Product at the place of destination set out in the contract. Thereafter Buyer shall bear all risk of the Product. For
   collection of the Product and to the extent applicable, the Buyer will comply with the standard policies, rules and/or
   procedures applicable at the relevant terminal or site. The foregoing shall also apply in the case of any partial delivery
   of a shipment.

11. FORCE MAJEURE: RELIEFS. (a) Neither Party shall incur liability to the other by reason of failure or delay in fulfiling
   its obligations where such failure or delay (i) is beyond the reasonable control of the Party affected, has a material
   impact on the affected Party and is caused by or results from: acts of God, fire, floods, storms, earthquake, explosions,
   strike, lockouts, cessation, slowdown or shortage or stoppage of labour, sabotage, piracy, riots, insurrection, blockade,
   war, war risk, hostility, enemy action, acts of terrorism, laws, regulations, rulings or acts of any governmental body or
   authority, requisiton, restrictions on obtaining or inability to obtain electricity or any other type of necessary energy,
   water, raw materials or labour, failure of equipment, storage, loading facilities, interruption of transportation not due to
   acts or ommissions of the Party claiming force majeure, failure of third party machinery due to accident or breakage,
   government restriction or prohibition of exports or imports, governmental seizure or expropriation, the inability or failure
   of the Seller’s production facility to produce or deliver, either wholly or partially, the Product, faulty or delayed delivery by
   Seller’s suppliers of raw material and other commodiities, the inability or failure by a supplier of goods to Seller, to
   produce or deliver, either wholly or partially, the goods, currency restrictions, obstruction of transportation routes,
   obstruction of navigation by ice at port of shipment, loss or detention at sea or the closure of international trade routes,
   or any other cause, whether of the same type or nature to the foregoing or (ii) is beyond the reasonable control of the
   Party affected and would have a material impact on such Party’s ability to perform its obligations under the purchase
   contract, whether or not the contingency is of the same type or nature as those enumerated in (i) above (each event in
   (i) and (ii) above a “Force Majeure”).
   (b) In the case of an event of Force Majeure the affected Party may suspend performance of all or any of its obligations
   to the other Party hereunder for such time as may be reasonably necessary under the circumstances by giving prompt
   written notice to the other Party explaining the full particulars of the Force Majeure event and to what extent a
   suspension is necessitated. Notice of the cessation of the Force Majeure event shall also be given promptly. During
   any suspension the affected Party shall use commercially reasonable efforts to remedy the Force Majeure. In the case
   of the Buyer experiencing a Force Majeure event, any shipment of Product in transit from Seller’s mills must be
   accepted and paid by the Buyer notwithstanding such Force Majeure event.
   (c) In the event of suspension of performance hereunder for less than twenty (20) consecutive days,
   shipments affected by such suspension shall be resumed as soon as practicable for the full contract quantity. When
   such suspension shall have continued for a period of twenty (20) consecutive days or more, the shipment(s) omitted
   during the period of suspension can be cancelled without liability to either Party, and subsequent shipments shall be
   resumed thereafter.

12. DELAYED SHIPMENT CAUSED BY LATE ARRIVAL OF SHIP. Notwithstanding anything contained herein, in the
   event of a shipment made in accordance with the terms hereof being delayed in arriving at the port of loading for a
   period not exceeding twenty-one (21) days after the expiry of the time of shipment provided for, such delay shall not by
   itself constitute a cause for refusing to ship or to take delivery of the relevant shipment or for claiming damages.

13. INCREASED COSTS/CHARGES. (a) If, after delivery of a consignment of Product under a purchase contract
   relating to more than one shipment, there occurs a substantial increase of not less than ten per cent (10%) of the total
   costs for the production and the transportation of Product, the Seller shall have the right to demand a renegotiation of
   the purchase price under such contract by giving written notice to such effect to the Buyer. Any renegotiated price shall
   affect only those shipments occurring from and after the date which is thirty (30) days after the date of such notice. If
   agreement cannot be reached within these thirty (30) days, the Seller may cancel the undelivered part of the contracted
   quantity. Any agreed increase in price shall continue for the duration of the period for which the Seller has such
   increased costs. In the event increased costs do not exceed ten percent (10%) of the total costs for the production and
   the transportation of Product, the Seller may assess surcharges from time to time on a commercially reasonable basis.

   (b) If the Buyer fails to pay in accordance with any payment terms agreed by the parties, the Seller may suspend
   deliveries hereunder and under any other purchase contract and/or charge interest in U. S. dollars at a rate of 1.5%
   per month (18% per annum) on all overdue amounts, charges and interest.




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14. CLAIMS. All claims hereunder must be made in writing in accordance with clause 24 hereof within thirty (30) days
   after the discharge of the Product at the place of destination set out in the purchase contract; claims made after expiry
   of such thirty (30) day period shall not be recognized or enforceable.

15. TAXES. The Buyer shall pay all government sales, value added and excise taxes and any other taxes or levies in
   respect of any delivery of Product under a purchase contract. Any tax or governmental charge enacted or increased
   as of or after the date hereof which is payable by the Seller or which increases the Seller’s cost of purchasing,
   processing, transporting, delivering or selling the Product (other than taxes on income) shall be paid by the Buyer to the
   Seller in addition to the price specified in this agreement. All import duties, taxes, wharfages, customs duty or other
   charges of whatsoever nature directly or indirectly applicable or relating to the import of Product into the importing
   country shall be for the Buyer’s account.

16. PRIVACY AND CONFIDENTIALITY. By providing personal information to the Seller, Buyer is consenting to the
   extent that such consent is required by law, to the collection, use, storage and disclosure of this information by Seller to
   enable Seller to establish, maintain and manage a relationship with Buyer.

17. COMPLIANCE WITH LAWS. The Buyer and the Seller shall comply with the relevant provisions of any international,
    national, federal, state, provincial or local law or ordinance and all lawful orders, rules and regulations issued
    thereunder, which are applicable to the operation of the Buyer’s or Seller’s respective businesses and the delivery and
    purchase of Product as set forth herein.

18. GOVERNING LAW. This agreement (including, without limitation, these General Terms and Conditions) and the legal
   relations between the Buyer and the Seller shall be governed by and construed in accordance with the laws of the
   Province of British Columbia and the federal laws of Canada applicable therein and shall in all respects be treated as a
   British Columbia contract.

19. ARBITRATION. All disputes arising in connection with this agreement (including, without limitation, these General
   Terms and Conditions) shall be finally settled under the Rules of Conciliation and Arbitration of the International
   Chamber of Commerce by one or more arbitrators appointed in accordance with the Rules.

20. ENTIRE AGREEMENT. This agreement (including, without limitation, these General Terms and Conditions)
   constitutes the full and complete agreement between the Parties related to the subject matter hereof and supersede all
   prior or contemporaneous understandings, statements or agreements between the Parties on the subject matter
   hereof. The Buyer acknowledges and agrees that no employee, officer, agent or representative of the Seller has the
   authority to waive any of, or make any representations, statements or promises in addition to, or in any way different
   than, those contained in, these General Terms and Conditions and that it is not entering into any agreement with the
   Seller in reliance upon any representation, statement or promise of the Seller except as expressly stated herein the
   purchase contract.

21. INCORPORATION OF TERMS AND AMENDMENTS. All purchase transactions between the Buyer and the Seller are
   subject to these General Terms and Conditions as if the provisions were fully set forth in writing and signed by the
   Parties. No changes, amendments or clarifications of this agreement (including, without limitation, these General
   Terms and Conditions) shall be valid or effective unless in writing and signed by an authorized representative of each of
   the Seller and Buyer.

22. SEVERABILITY. The provisions of this agreement (including, without limitation, these General Terms and Conditions)
   are severable, and if any one or more such provisions may be found to be unenforceable, in whole or in part, the
   remaining provisions shall nevertheless be binding and enforceable.

23. NO WAIVER. Each remedy contained in this agreement (including, without limitation, these General Terms and
   Conditions) shall be cummulative and in addition to any other remedy provided by law. The failure by either Party to
   insist on strict performance of any provision contained in this agreement (including, without limitation, these General
   Terms and Conditions) or to take advantage of any right contained herein, shall not be construed as a waiver of such
   provision or right.

24. NOTICE. Unless another method of giving notice hereunder is expressly agreed between the Parties in this
   agreement, all notices to be delivered hereunder shall be delivered by hand or sent by facsimile or prepaid courier to
   the address of the Party for which it is intended as set out in herein or such other address as either Party may stipulate
   to the other by notice. Any notice delivered by hand or prepaid courier will be deemed to be received on the date
   actually delivered and any notice delivered by facsimile will be deemed to be received on the business day following the
   day the sender receives facsimile confirmation of the delivery.
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25. ENUREMENT. The provisions hereof (including, without limitation, these General Terms and Conditions) shall enure
   to the benefit of, and be binding upon, the Parties and their respective successors and permitted assigns. Any
   agreement between the Parties shall be assignable by a Party with the consent of the other Party.




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