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Excellence in Corporate Finance.

General terms and conditions

1. Applicability

These General Terms and Conditions (GTC) shall be part of all contracts concluded by and between M27 Finance GmbH, A-1010 Vienna, Stallburggasse 4/2/8 or M27 Consulting GmbH, A-1090 Vienna, Prechtlgasse 9/19, (hereinafter referred to as M27) and a contracting party (hereinafter referred to as "Customer"). Accordingly, these GTC shall also apply to all future contractual relationships between the Customer and M27.

Regulations amending or abolishing these terms and conditions shall only be valid upon M27's written confirmation. Derogating, conflicting or amending GTC shall not become part of the contract, unless applicability of the same has been expressly agreed in writing. Any standard reference to the Customer's general terms and conditions on its letterhead is objected to.

2.Subject matter of contract, transaction

M27 offers the Customer management consulting services. This includes but is not limited to consulting services in the fields of:

  • corporate finance including business or project funding ("Funded Projects")
  • optimisation of marketing and distribution, internationalisations
  • other business administration matters.

Corporate finance contracts including business or project funding ("Funded Projects") normally concern successful conclusion of a transaction. For the purposes of these General Terms and Conditions transaction means in particular:

  • any sale or acquisition of shares (in joint-stock companies or limited liability companies) or of assets or businesses or divisions, any sales, investment and/or co-operation and/or company and/or assignment and/or option and/or merger and/or equity swap;
  • any conclusion of co-operation agreements, development agreements, licence agreements or establishment of strategic partnerships, etc.;
  • any funding or refinancing of a business or entrepreneur;
  • any lease of a business or facilities of that business;
  • any other commercial use of a business or parts of the same by third parties;
  • any business or project funding ("Funded Project")
  • any direct additional revenue from new markets and/or market segments and/or customers in connection with marketing, distribution and internationalisation projects

Details, such as project targets, consulting services to be rendered in specific project stages, scope, duration and fees and the mode of billing shall be stipulated in the service package agreed with the customer on a case-by-case basis and in the specifications, which will be described separately in a contractual document and become a part of the contract upon signing by the Customer and M27. The consulting services in specific project stages may be documented and/or illustrated in the contract non-exhaustively. Such documentation and/or illustrations shall represent the considerations at the time the offer is made and are based on standard processes and may be amended or modified unilaterally by M27 as necessary in accordance with the progress of the project, if according to M27's judgment the project target defined in the specifications can in this way be achieved better or more efficiently.

M27 shall be entitled to the agreed fee upon conclusion of any of the transactions and rendering of any of the consulting services stated above, even if not explicitly provided for in the contract. For details see Clause 4 and 10 of these GTC.

3. Transaction value

The transaction value shall be the basis for calculation of the contingent fee. Transaction value means the sum total of all services rendered for conclusion of the transaction as defined in Clause 2 GTC. Those services shall include but not be limited to the following components:

  • payments (e.g. assignment price, purchase price);
  • payments and other services rendered to third parties;
  • value of liabilities and payables assumed (actual indebtedness);
  • value of loss carryforwards taken on;
  • value of contributed, authorised or promised funds in the form of equity capital, borrowings, mezzanine capital and other means of financing;
  • value of swap items (e.g. assignment of shares);
  • value of option rights granted under a contract;
  • value of capital increases;
  • value of regularly recurring services and rights granted;
  • value of the promised funding for businesses or projects ("Funded Project");
  • value of direct additional revenue from new markets and/or market segments and/or customers in connection with marketing, distribution or internationalisation projects;
  • value of all means of financing authorised or promised by M27 as a result of the contract or negotiation for the Customer and all of its affiliates or related entities.

In this context it is of no relevance which party has to provide such components. If the transaction value cannot be determined in the manner described above, it shall be fixed at the market value of the business concerned. If the transaction in whole or in part consists of contracts on a (commercial) lease, licence, use, co-operation or of similar contracts, the consideration payable for a period of ten years shall be deemed the transaction value. The transaction value shall not be reduced by the fee charged by M27.

If the subject matter of the transaction is merged with another company, affiliated through joint venture agreements, co-operation agreements or otherwise and it is not possible to determine the transaction value, M27 shall determine the amount of the contingent fee taking account of the services rendered by M27, the expected increase in value of the shares held by the Customer due to the merger as well as the scope, term and general business consulting in connection with such contracts.

4.Fee

The fee may be calculated and charged either on the basis of time units worked, as a project lump sum, on the basis of monthly flat rates, depending on the achievement of specific project targets (contingent fee) or by a combination of the aforementioned types of billing. The contract shall provide what kind of billing has been agreed for the specific order. Depending on the agreed type of billing the fee will be calculated according to the following guidelines and at the following dates, unless otherwise agreed in the specifications:

4.1.For agreements on the basis of daily and/or hourly rates: The fee will be calculated on the last day of every month according to the time units worked (every 15 minutes commenced) on the basis of the agreed hourly rate. If daily rates have been agreed, the hourly rate shall be one eighth of the agreed daily rate. The Customer shall be entitled to ask M27 for a statement of time units worked at any time. If the agreed minimum contract value, if any, has not been worked by the end of the term, M27 shall still be entitled to charge the outstanding project volume.

4.2.For agreements with project lump sums: One third of the total fee will be invoiced upon commencement of the project, another third after half of the project time agreed at the date of the specifications and the last third upon completion of the project. In the case of Funded Projects one half of the total fee will be invoiced upon commencement of the project and the other half at the time the funding application is filed. Funded Projects with a term of several years will be charged in the same way.

4.3.For Agreements with monthly flat rates: The agreed flat rate will be invoiced as of the last day of the relevant month irrespective of the time units worked by then.

4.4.For Agreements with contingent fees: The agreed contingent fee will be invoiced at the time of conclusion of the transaction (see Clause 5 GTC). The transaction value (see Clause 3 GTC) shall constitute the basis for calculation of the contingent fee.

If the transaction value increases after the end of the contract or after the transaction value was promised (e.g. in the case of funding), the relevant basis for calculation of the contingent fee shall increase accordingly.

The specifications may include an agreement on a minimum contingent fee which will be the minimum that will be charged in the case that the transaction is concluded (see Clause 5 GTC). The contingent fee shall also be payable to M27 if a transaction is concluded within 12 months of the end of the term of contract agreed with M27. In case of a termination of the contract by the Customer (see Clause 10 GTC) M27 is entitled to receive the agreed minimum contingent fee.

5.Conclusion of a transaction

Conclusion of a transaction means conclusion of the relevant agreement (signing of the contract, oral agreement) irrespective of the different date of performance of the contract or conclusion of agreements on execution, additional transactions or follow-up transactions.

A transaction shall be deemed concluded even if only a letter of understanding or option agreement is concluded or if a down payment is effected on the basis of an offer. A transaction shall in any case be deemed concluded if the commercial intention that corresponds to the legal transactions listed in Clause 2 GTC is realised in any way. If agreements are made on a condition precedent, the transaction shall be deemed concluded upon signing of the contract.

A transaction shall also be deemed concluded if the Customer concludes the originally intended transaction with a partner, affiliate of the partner, business owner or an authorised officer of a group company or other affiliate.

6.Follow-up transactions:

If, after conclusion of a transaction, additional transactions (follow-up transactions) related to the transaction are concluded within three years, M27 shall be entitled to the agreed contingent fee for each of those follow-up transactions, which shall be calculated on the basis of the final total transaction value (including follow-up transactions). In that case M27 shall be entitled to charge the additional contingent fee for follow-up transactions subsequently. The Customer shall be obliged to immediately notify M27 of conclusion of any transaction or follow-up transaction including all information required to calculate the contingent fee.

7.Services of M27

M27 undertakes to render the consulting services agreed in the specifications for the different project stages on time in accordance with Clause 2 GTC. Even though M27 promises to render its consulting services with utmost care and diligence, no warranty or guarantee for achieving the project target in line with the time schedule or as to the merits can be assumed because no contract for work is concluded. M27 owes no success to the Customer. M27 will render no advice on tax or legal issues, which is why the Customer is expressly advised to have all analyses and recommendations provided by M27 in the course of its consulting services examined separately for their tax and legal implications on a case-by-case basis. M27 will advise potential contacts, if necessary.

8.Project team

M27 shall provide a project team to execute the order and the name(s) of the project manager(s) will be stated in the contract. M27 may call in additional team members if and when necessary in the course of the project. If the project management is replaced unilaterally, the contract shall remain effective nevertheless. Contracts with external consultants shall be entered into directly by the Customer in agreement with M27. Proposals or recommendations may be made to M27 if requested. For specific activities which are not included in the non-exhaustive list of M27 services (e.g. technology advice, streamlining measures, optimisation of the production process, optimisation of locations, etc.) it is intended to call in appropriate external experts, unless the Customer is able to discharge those tasks internally. Services to be provided within the scope of the agreed consulting services in specific project stages may be rendered by any of the two businesses stated in Clause 1 GTC and will be invoiced directly to the Customer by the business that renders the service according to the volume defined in the specifications.

9.Support by the Customer

The Customer is aware of the fact that its support will constitute a substantial contribution to achievement of the project targets. Therefore, the Customer guarantees to render all organisational, technical and commercial assistance to make achievement of the defined project targets within the agreed time schedule possible. The Customer shall ensure that, when fulfilling the consulting contract at its registered office, the organisational framework conditions will provide for working conditions that allow undisturbed work supporting a speedy consulting process to the extent possible. The Customer shall also inform M27 comprehensively about consulting services which were rendered earlier and/or are rendered at present, even with regard to different fields. If achievement of the defined project targets is prevented because of the lack of support by the Customer, this shall constitute an important reason (cause) for M27 for termination of the contract as laid down in Clause 10 GTC. Specifically, at M27's request, communication with public authorities (tax office, municipal treasury, funding agencies, chambers, social security funds, etc.), professional preparation of general business, financial and project data and technical specifications for the projects covered by this agreement shall be carried out by and the necessary detailed data and information shall be provided by staff of the Customer unless the parties have expressly agreed in the contract that M27 is to render those services. The Customer shall, in general, be obliged to ensure that M27 will be presented with all documents required for fulfilment and execution of the consulting contract in good time and with no specific request and that it will be informed of all events and circumstances which may be of significance to execution of the consulting contract/achievement of the project targets. This shall also apply to all documents, events and circumstances which become known to M27 only during its work.

The Customer shall appoint one internal commercial contact and one internal technical contact for each project. In addition, the Customer shall ensure that its employees and the employees' representation (works council) provided for by law that may have been established are informed of the work of M27 prior to commencement of the same. The Customer instructs and authorises M27 in the name and for the account of the Customer to obtain project-relevant documents, data and information from agencies and institutions involved in the project (funding agencies, public authorities, etc.).

10.Duration of contract; project term; termination; binding nature; compensation payment

Contracts shall become effective on the day they are signed by both parties, i.e. the Customer and M27. The specifications may provide for an expected project term. Contracts shall terminate as of the end of the calendar month in which, calculated from the date the contract becomes effective, the project is expected to end, which will be calculated on the basis of the expected project term. If the expected project term is exceeded, both parties shall be free to agree on a renewal of the contract by mutual consent. If no term of contract or expected project term is agreed, the contract shall be concluded for an indefinite period of time and may be terminated by either party in writing with immediate effect at any time.Contracts which have not been concluded for an indefinite term may be terminated by the Customer by unilateral written notice given during the term of contract also for any reason other than a material breach of duty by M27 or force majeure. In that case and in the case of termination by notice of contracts with an indefinite term by the Customer the contract shall be deemed terminated after the current calendar month has been accounted for and subject to the following provisions on billing or compensation payments, if any. Regarding the Clauses listed below (see Clauses 10.1 to 10.4) and in case of premature termination of the projects any discounts at least allowed on hourly rates shall be refunded by the Customer to M27 together with the final invoice.

10.1.For agreements on the basis of daily and/or hourly rates: M27 shall be entitled to charge the hours worked until termination of the contract. In addition, and only if a minimum volume has been agreed in the contract - and not been achieved yet - M27 shall be entitled to a compensation payment in the amount of the outstanding project volume.

10.2.For agreements with project lump sums: M27 shall be entitled to invoice its regular services in proportion of the project term that has already passed to the expected project term agreed in the specifications. M27 shall also be entitled to a compensation payment in the amount of the project volume not yet invoiced (of the project lump sums not yet invoiced).

10.3.For agreements with monthly flat rates: M27 shall be entitled to charge the full current calendar month. Only if a minimum project term has been agreed in the contract shall M27 also be entitled to a compensation payment in the amount of the monthly flat rates not yet paid or invoiced.

10.4.Agreements with contingent fees: If the transaction is concluded (see Clause 5 GTC), M27 shall be entitled to charge the full contingent fee upon termination of the contract. If at the time of termination of the contract the transaction has not been concluded yet or only in part, M27 shall in addition be entitled to a compensation payment in the amount of the agreed minimum contingent fee in any case; if no minimum contingent fee has been agreed, the amount of the agreed project lump sum or agreed monthly flat rates or the amount of the standard hourly rate multiplied by the actual hours worked shall be charged in any case. For purposes of correct calculation of claims M27 shall provide an expert opinion of a chartered accountant on the issue of conclusion of the transaction (see Clause 5 GTC) at its costs and upon the Customer's request in the relevant period.

The Customer is at any time entitled to terminate contracts with immediate effect on the ground of a material breach of duty by M27 or due to force majeure by unilateral declaration of intention by registered letter; in that case no compensation payment shall become due. M27 may terminate contracts by registered letter for important reason (cause), such as if a petition for opening of insolvency proceedings over the Customer's assets is filed, in the case of default in payment despite a reminder and having granted a reasonable grace period or lack of support by the Customer as defined in Clause 9 GTC, violation of the agreed exclusivity as defined in Clause 14 GTC, violation of Clause 16 GTC; in that case the legal effects (in particular with respect to termination, billing and compensation payments, if any) will apply in the same way as if the contract had been terminated by the Customer by unilateral written notice during the term of contract for a reason other than material breach of duty by M27 or force majeure. Provisions of Clause 12 to 17 GTC and provisions on billing or compensation payments, if any, shall in any case remain valid after termination of the contract by either party.

11.Trips, ancillary costs and expenses

In the course of rendering its services M27 may be required to make trips in Austria and abroad. In principle, M27 shall inform the Customer of the trip in advance and will make the trip only upon the Customer's approval. Travel times shall commence upon leaving the client or M27's office and shall end when the staff commences work or arrives at the hotel and commence when the work is finished or the staff leaves the hotel and end after s/he returns to the client or arrives at M27's office. Travel times shall be charged on an hourly basis (see Clause 4.1 GTC). All expenses and costs incurred in the course of the trip shall be borne by the Customer. Per diems will be charged to cover the personal expenses of M27's staff in accordance with fee class 5 of the "Payroll tax table". Overnight allowances will be accounted for if no hotel bill is provided. Travels to and from the Customer shall be deemed part of the working time unless they take more than two hours one way. Longer travel times shall be deemed trips. Ancillary costs means any expenses that need to be incurred to perform the consulting contract, including but not limited to costs of office and auxiliary work, telecommunications, copying, stamp duties or similar or other cash expenses. In the case of international consulting projects they may be charged by means of a surcharge of 3% on the agreed fee; ancillary costs shall be charged at the amount by which they exceed the usual expenses considerably.

12.Terms of payment

All payments shall be become due and shall be effected into M27's account promptly without any deduction. All fees stated in the specifications are exclusive of statutory value added tax. In the case of default in payment, statutory default interest and at least 12% p.a. or, if the statutory default interest rate is higher, statutory default interest will be charged. The Customer shall also be obliged to immediately reimburse dunning and collection costs as additional default damages. In that case M27 shall be entitled to charge fees/expenses for reminders in accordance with the current tables of maximum rates pursuant to the Regulation on maximum rates for collecting agencies (currently according to BGBl [Federal Law Gazette] 141/96; "Inkassoverordnung [Collection Regulation]"). If a third party is called in who charges dunning and collection costs in accordance with the statutory provisions applicable from time to time (RATG [Austrian Statute on Lawyers' Tariffs]; Collection Regulation, etc.), the Customer shall pay such dunning and collection charges.

13.Secrecy

M27 agrees not to disclose confidential information to any persons other than professional advisors and members of the management or M27 staff or M27 affiliates who have to receive and observe such information in connection with their job for purposes of execution of the transaction at any time, not even after termination of the project and M27 shall notify them of the confidential nature of such information. However, the Customer agrees that the transaction be mentioned in the list of references of M27 (without any details). Confidentiality shall apply mutatis mutandis to confidential information made available to the Customer by M27.

14.Exclusivity

For the term of this retainer agreement with regard to the project the Customer undertakes to refrain from retaining other consulting firms or other third parties for the same or a similar order and to terminate other contracts that may exist in this regard. If third parties contact the Customer directly with regard to the project they shall be referred to M27.

15.Warranty / liability

Irrespective of fault M27 shall be entitled and obliged to remedy inaccuracies or defects of its services which become known. The Customer's warranty claim shall expire six months after the respective services were rendered. Claims for damages of the Customer vis-à-vis M27 shall be limited to cases where wilful or grossly negligent violation of loyalty and fiduciary duties by M27 can be proved. This shall apply mutatis mutandis to damage caused by third parties commissioned by M27. M27 assumes no liability vis-à-vis the Customer for any production downtime, lost profit, loss of use, lost business opportunities or other consequential damage of whatsoever kind. Liability shall in any case be limited to the amount of the fees paid. Claims for damages must be asserted by the Customer in court within six months of knowledge of the damage; otherwise the claim shall be forfeited. The Customer shall in each case have to prove that the damage is due to M27's fault. To the extent that M27 renders its services with the assistance of third parties and claims under warranty and/or liability arise vis-à-vis those third parties in this connection, M27 shall assign such claims to the Customer. In that case the Customer shall primarily hold liable those third parties.

16.Protection of intellectual property

The copyrights to works created by M27 and its staff and third parties commissioned (including but not limited to offers, reports, analyses, expert opinions, organisational plans, programmes, specifications, drafts, calculations, drawings, data carriers, etc.) shall remain with M27. The Customer may use the same exclusively for purposes of the contract both during and after termination of the contractual relationship. In particular, the Customer shall not be entitled to reproduce and/or disseminate the work(s) without M27's express consent. M27 shall in no case become liable, including e.g., for accuracy of its work, vis-à-vis third parties in the case of unauthorised reproduction or dissemination of the work(s). If the Customer violates these provisions, M27 shall be entitled to terminate the contract with immediate effect as defined in Clause 10 GTC.

17.Severability clause; invalid provisions; gaps; miscellaneous

If due to circumstances which are beyond M27's control the prerequisites for the project should change so massively that the project can no longer be carried out or can only be carried out at significantly increased costs, the provisions of this contract shall be adapted accordingly.

If parts of the agreement or the GTC are invalid, the validity of the agreement or the GTC as such shall not be affected but they shall be replaced by provisions which come as close as possible to the commercial objectives of the agreement.

Amendments to and/or modifications of a contract may only be made by mutual consent and shall only be valid if made in writing. All agreements shall be governed by Austrian law, even if Austrian law should refer to foreign law (exclusion of the conflict of laws rules).

For all disputes directly or indirectly arising out of the business relationship between the Customer and M27 Vienna shall be the agreed exclusive place of jurisdiction.

Vienna, October 2014