1. General

(i) All orders are accepted by the Company from the Buyer on the following terms, conditions and exceptions and no other terms, conditions or warranties shall apply unless agreed to in writing by the Company.

(ii) References to Incoterms are references to the edition of Incoterms published by the International Chamber of Commerce in force at the date when the contract is made and expressions used in any contract shall have the meanings ascribed to them by Incoterms as modified by these Conditions of Sale.

2. Prices and Payment

(i) All prices, UK and Export are subject to adjustment without notice. The contract price shall be the price current at the date of despatch of the goods.

(ii) In the case of U.K. sales payment shall be effected by cash, cheque or credit transfer by the end of the month following the date of invoice. In the case of Export sales, payment shall be made at such time and in such manner as expressed in the contract and the Company reserves the right at any time to request payment by Confirmed Irrevocable Letter of Credit confirmed by an approved bank in the U.K.

(iii) Any bank or other charges on negotiable instruments in respect of Export payments are payable by the customer.

(iv) The Company reserves the right to charge interest at the Court approved rate on overdue payments.

3. Licences, Taxes and Other Charges

(i) The placing of an order with the Company is deemed to constitute a warranty and representation by the Buyer that every applicable licence (import or otherwise), foreign exchange control authorisation or any other authorities that may be required in connection with the goods supplied have been or will be duly obtained by and at the expense of the Buyer.

(ii) Unless otherwise agreed in writing the contract price does not include Value Added Tax ("VAT") or any other tax or levy on the supply or importation of the goods which shall be charged extra. Insofar as the Buyer is situated in another member state of the European Community, with effect from 1st January 1993 and until completion of the Internal Market of the European Community, VAT will be added to the contract price automatically unless the Buyer provides its VAT registration details and all other appropriate information to the Company.

(iii) The Basic Tax Point for VAT (where applicable) is the invoice date.

4. Carriage, Risk and Property

(i) Details of carriage terms are given in the Company's current price list.

(ii) In the case of U.K. sales, unless otherwise agreed, risk of loss or damage to the goods shall pass to the Buyer when the goods are handed to the carrier for delivery to the Buyer. Subject thereto, where goods are to be carried at the cost of the Company, the Company will bear the risk of loss or damage in transit provided that the Company shall have received written notification of such loss or damage within five days of the date of despatch.

(iii) In the case of Export sales, unless otherwise agreed, Incoterms shall apply and risk of loss or damage to the goods shall pass to the Buyer in accordance with the terms of the shipping documents. The Company does not normally insure the goods during transit abroad.

(iv) Where the goods are to be collected by the Buyer, the Company shall be entitled to treat the contract as repudiated, and re-sell the goods, should the Buyer fail to collect the goods within 14 days of notification by the Company that they are ready for despatch.

(v) (a) Notwithstanding the passing of risk, the Company retains ownership of the goods the legal and equitable title in which shall not pass to the Buyer until the Company has received payment of the price of all of the goods (whether or not the goods are delivered in instalments and some have been paid for by the Buyer) and until such time the Buyer shall hold the goods in a fiduciary capacity for the Company and in particular the Buyer:

(1) shall insure the delivered goods against any loss or damage with an insurance office of repute;

(2) shall store the delivered goods separately or in some other way ensure that they are readily identifiable as the property of the Company;

(3) shall deliver the goods to the Company forthwith on demand and if the Buyer fails to do so the representatives of the Company shall be entitled to enter upon the Buyer's premises where the delivered goods are or are thought by the Company to be stored for the purpose of repossessing them (including without limitation removing or detaching them from the New Goods as defined in Clause 4(v)(d) and subsequently reselling them;

(4) shall keep and retain the delivered goods free from any charge lien or other encumbrance thereon.

(b) Upon any resale of any of the goods by the Company pursuant to Clause 4(v)(a)(3) if the proceeds of sale exceed the amount of all sums due to the Company from the Buyer the Company shall pay the excess to the Buyer having deducted the cost and expense of the repossession and re-sale of the goods and any damages which the Company has suffered as a result of any breach of the contract by the Buyer;

(c) Until the Company has received full payment of all the sums due to the Company from the Buyer provided always that the Buyer continues to trade and is not insolvent nor enters into liquidation whether compulsorily or voluntarily nor becomes subject to an administration order nor has a receiver appointed over all or any part of its assets nor compounds with nor convenes a meeting of its creditors nor takes or suffers any similar action in consequence of a debt the Buyer shall be entitled to offer for sale and sell the goods in the ordinary course of business as principal for its own account and not as agent for the Company. Where any of the goods is sold to a third party before title to it has passed to the Buyer, that sale will constitute a sale by the Buyer of the Company's property.

(d) If the Buyer incorporates the goods within other equipment or products ("the New Goods") provided that the goods remain a readily identifiable and removable part of the New Goods the provisions of Clauses 4(v)(a) and 4(v)(b) shall apply.

(e) The provisions of this Clause 4(v) shall survive the termination of the contract for whatever reason and in particular but without limitation termination of the contract by the Company by the acceptance of any repudiation of the contract by the Buyer.

5. Delay and Force Majeure

(i) Whilst every effort will be made to comply with any quoted dates given for dispatch or delivery, time shall not be of the essence and the Company shall not be liable for any loss or damage caused by delay or failure by the Company in obtaining goods from the Company's own suppliers, or any loss or damage caused by strikes, lockouts, trade disputes, transport delays, shortages of material, breakdowns, fire, accidents and/or any causes whatsoever beyond the company's control. Such delay shall not constitute a breach or repudiation of the contract.

(ii) In the event of performance of the contract being frustrated or prevented by reason of war, civil commotion or the operation of any statute, order, regulation or promulgation made by any statutory or duly constituted authority whether in the UK or elsewhere, the Buyer shall accept and pay for all goods delivered, work executed and expenses incurred in connection with the contract up to the date of such event, and the Company shall from such date be under no further liability under the contract.

6. Specifications

(i) The specifications of the goods shall be those stated in the Company's current catalogue.

(ii) Whilst specifications are considered to be correct at the date of printing the Company reserves the right to change specifications of the goods and their packing and presentation without prior notification having regard to the Company's continuing programme of research and development.

(iii) Original equipment part numbers are quoted for reference purpose only and are not intended to infer that equivalent replacements are used as original equipment.

7. Warranties

(i) Subject to the conditions set out below and Clause 4(ii), the Company warrants that the goods will correspond to their specification and will be free from defects in materials and workmanship for a period of 12 months from the date of delivery, or in the case of goods which have a shorter working life as determined by the Company, three months from the date of delivery ("The Warranty Period").

(ii) If the Company receives written notice during the Warranty Period from the Buyer of any breach of the above warranty then the Company shall at its own expense and within a reasonable time after receiving such notice repair, or at its option replace the goods or otherwise remedy such defect. The Buyer will, at the request of the Company, return such defective goods to the Company carriage paid.

(iii) The Company shall be under no liability under the above warranty:

(a) in respect of any defect in the goods arising from any drawing, design or specification supplied by the Buyer;

(b) in respect of any defect arising from fair wear and tear, wilful damage, negligence of the Buyer, abnormal working conditions, failure to follow the Company's instructions (whether oral or in writing), misuse or alteration or repair of the goods without the Buyer's approval, or improper storage.

(c) where the goods are transported to the Buyer at the Buyer's risk and the defect occurred during transit;

(d) in respect of non-Vapormatic branded goods. In that case the buyer shall only be entitled to the benefit of any such warranty or guarantee as is given by the manufacturer to the Company.

(iv) The Company shall have no liability under the above warranty other than under Clause 7(ii) above. If the Company fails to comply with such obligations its liability for such failure shall be limited to the contract price of the goods.

(v) The express terms of these Conditions of Sale are in lieu of all warranties, conditions, terms, undertakings, and obligations implied by statute, common law, custom, trade usage, course or dealing or otherwise, all of which are hereby excluded to the fullest extent permitted by law. The United Nations Convention on Contracts for the International Sale of Goods (Vienna, 1980) shall not apply to orders for goods.

8. Liability

Except in respect of injury to or death of any person caused by the Company's negligence, or in respect of the Company's liability under the Consumer Protection Act 1987 for any injury to or death of any person or loss of or damage to property intended for private use caused by a defect in the goods the Company shall not be liable to the Buyer for any loss or damage which arises out of or in connection with the supply of the goods or their use or resale by the Buyer, except as expressly provided in these Conditions of Sale.

9. Construction

These Conditions of Sale shall be subject to and shall be construed in accordance with English law and the High Court of Justice in London shall have non-exclusive jurisdiction over any dispute which may arise hereunder unless the parties agree otherwise in writing.

1. Definitions

1.1 "Company" means Vapormatic NZ Ltd, its successors and assigns or any person acting on behalf of and with the authority of Vapormatic NZ Ltd.

1.2 "Buyer" means the person/s buying the Goods as specified in any invoice, document or order, and if there is more than one Buyer is a reference to each Buyer jointly and severally.

1.3 "Goods" means all Goods or Services supplied by the Company to the Buyer at the Buyer's request from time to time (where the context so permits the terms 'Goods' or 'Services' shall be interchangeable for the other).

1.4 "Price" means the Price payable for the Goods as agreed between the Company and the Buyer in accordance with clause 4 below.

2. Acceptance

2.1 The Buyer is taken to have exclusively accepted and is immediately bound, jointly and severally, by these terms and conditions if the Buyer places an order for or accepts delivery of the Goods.

2.2 These terms and conditions may only be amended with the Company's consent in writing and shall prevail to the extent of any inconsistency with any other document or agreement between the Buyer and the Company.

3. Change in Control

3.1 The Buyer shall give the Company not less than fourteen (14) days prior written notice of any proposed change of ownership of the Buyer and/or any other change in the Buyer's details (including but not limited to, changes in the Buyer's name, address, contact phone or fax number/s, or business practice). The Buyer shall be liable for any loss incurred by the Company as a result of the Buyer's failure to comply with this clause.

4. Price and Payment

4.1 At the Company's sole discretion the Price shall be either:

(a) as indicated on any invoice provided by the Company to the Buyer; or

(b) the Price as at the date of delivery of the Goods according to the Company's current price list; or

(c) the Company's quoted price (subject to clause 4.2) which will be valid for the period stated in the quotation or otherwise for a period of thirty (30) days.

4.2 The Company reserves the right to change the Price if a variation to the Company's quotation is requested.

4.3 At the Company's sole discretion a non-refundable deposit may be required.

4.4 Time for payment for the Goods being of the essence, the Price will be payable by the Buyer on the date/s determined by the Company, which may be:

(a) for certain approved Buyer's, due twenty (20) days following the end of the month in which a statement is posted to the Buyer's address or address for notices;

(b) the date specified on any invoice or other form as being the date for payment; or

(c) failing any notice to the contrary, the date which is seven (7) days following the date of any invoice given to the Buyer by the Company.

4.5 Payment may be made by cash, cheque, bank cheque, electronic/on-line banking, credit card (plus a surcharge of up to two and a half percent (2.5%) of the Price), or by any other method as agreed to between the Buyer and the Company.

4.6 Unless otherwise stated the Price does not include GST. In addition to the Price the Buyer must pay to the Company an amount equal to any GST the Company must pay for any supply by the Company under this or any other agreement for the sale of the Goods. The Buyer must pay GST, without deduction or set off of any other amounts, at the same time and on the same basis as the Buyer pays the Price. In addition the Buyer must pay any other taxes and duties that may be applicable in addition to the Price except where they are expressly included in the Price.

5. Delivery of Goods

5.1 Delivery ("Delivery") of the Goods is taken to occur at the time that the Company (or the Company's nominated carrier) delivers the Goods to the Buyer's nominated address even if the Buyer is not present at the address.

5.2 At the Company's sole discretion the cost of delivery is in addition to the Price.

5.3 Any time or date given by the Company to the Buyer is an estimate only. The Buyer must still accept delivery of the Goods even if late and the Company will not be liable for any loss or damage incurred by the Buyer as a result of the delivery being late.

6. Risk

6.1 Risk of damage to or loss of the Goods passes to the Buyer on Delivery and the Buyer must insure the Goods on or before Delivery.

6.2 If any of the Goods are damaged or destroyed following delivery but prior to ownership passing to the Buyer, the Company is entitled to receive all insurance proceeds payable for the Goods. The production of these terms and conditions by the Company is sufficient evidence of the Company's rights to receive the insurance proceeds without the need for any person dealing with the Company to make further enquiries.

6.3 If the Buyer requests the Company to leave Goods outside the Company's premises for collection or to deliver the Goods to an unattended location then such Goods shall be left at the Buyer's sole risk.

7. Title

7.1 The Company and the Buyer agree that ownership of the Goods shall not pass until:

(a) the Buyer has paid the Company all amounts owing to the Company; and

(b) the Buyer has met all of its other obligations to the Company.

7.2 Receipt by the Company of any form of payment other than cash shall not be deemed to be payment until that form of payment has been honoured, cleared or recognised.

7.3 It is further agreed that:

(a) until ownership of the Goods passes to the Buyer in accordance with clause 7.1 that the Buyer is only a bailee of the Goods and must return the Goods to the Company on request.

(b) the Buyer holds the benefit of the Buyer's insurance of the Goods on trust for the Company and must pay to the Company the proceeds of any insurance in the event of the Goods being lost, damaged or destroyed.

(c) the Buyer must not sell, dispose, or otherwise part with possession of the Goods other than in the ordinary course of business and for market value. If the Buyer sells, disposes or parts with possession of the Goods then the Buyer must hold the proceeds of any such act on trust for the Company and must pay or deliver the proceeds to the Company on demand.

(d) the Buyer should not convert or process the Goods or intermix them with other goods but if the Buyer does so then the Buyer holds the resulting product on trust for the benefit of the Company and must sell, dispose of or return the resulting product to the Company as it so directs.

(e) the Buyer irrevocably authorises the Company to enter any premises where the Company believes the Goods are kept and recover possession of the Goods.

(f) the Company may recover possession of any Goods in transit whether or not delivery has occurred.

(g) the Buyer shall not charge or grant an encumbrance over the Goods nor grant nor otherwise give away any interest in the Goods while they remain the property of the Company.

(h) the Company may commence proceedings to recover the Price of the Goods sold notwithstanding that ownership of the Goods has not passed to the Buyer.

8. Personal Property Securities Act 1999 ("PPSA")

8.1 Upon assenting to these terms and conditions in writing the Buyer acknowledges and agrees that:

(a) these terms and conditions constitute a security agreement for the purposes of the PPSA; and

(b) a security interest is taken in all Goods previously supplied by the Company to the Buyer (if any) and all Goods that will be supplied in the future by the Company to the Buyer.

8.2 The Buyer undertakes to:

(a) sign any further documents and/or provide any further information (such information to be complete, accurate and up-to-date in all respects) which the Company may reasonably require to register a financing statement or financing change statement on the Personal Property Securities Register;

(b) indemnify, and upon demand reimburse, the Company for all expenses incurred in registering a financing statement or financing change statement on the Personal Property Securities Register or releasing any Goods charged thereby;

(c) not register a financing change statement or a change demand without the prior written consent of the Company; and

(d) immediately advise the Company of any material change in its business practices of selling the Goods which would result in a change in the nature of proceeds derived from such sales.

8.3 The Company and the Buyer agree that nothing in sections 114(1)(a), 133 and 134 of the PPSA shall apply to these terms and conditions.

8.4 The Buyer waives its rights as a debtor under sections 116, 120(2), 121, 125, 126, 127, 129, 131 and 132 of the PPSA.

8.5 Unless otherwise agreed to in writing by the Company, the Buyer waives its right to receive a verification statement in accordance with section 148 of the PPSA.

8.6 The Buyer shall unconditionally ratify any actions taken by the Company under clauses 8.1 to 8.5.

9. Security and Charge

9.1 In consideration of the Company agreeing to supply the Goods, the Buyer charges all of its rights, title and interest (whether joint or several) in any land, realty or other assets capable of being charged, owned by the Buyer either now or in the future, to secure the performance by the Buyer of its obligations under these terms and conditions (including, but not limited to, the payment of any money).

9.2 The Buyer indemnifies the Company from and against all the Company's costs and disbursements including legal costs on a solicitor and own client basis incurred in exercising the Company's rights under this clause.

9.3 The Buyer irrevocably appoints the Company and each director of the Company as the Buyer's true and lawful attorney/s to perform all necessary acts to give effect to the provisions of this clause 9 including, but not limited to, signing any document on the Buyer's behalf.

10. Buyer's Disclaimer

10.1 The Buyer hereby disclaims any right to rescind, or cancel any contract with the Company or to sue for damages or to claim restitution arising out of any inadvertent misrepresentation made to the Buyer by the Company and the Buyer acknowledges that the Goods are bought relying solely upon the Buyer's skill and judgment.

11. Defects

11.1 The Buyer shall inspect the Goods on delivery and shall within seven (7) days of delivery (time being of the essence) notify the Company of any alleged defect, shortage in quantity, damage or failure to comply with the description or quote. The Buyer shall afford the Company an opportunity to inspect the Goods within a reasonable time following delivery if the Buyer believes the Goods are defective in any way. If the Buyer shall fail to comply with these provisions the Goods shall be presumed to be free from any defect or damage. For defective Goods, which the Company has agreed in writing that the Buyer is entitled to reject, the Company's liability is limited to either (at the Company's discretion) replacing the Goods or repairing the Goods.

11.2 Goods will not be accepted for return other than in accordance with 11.1 above.

12. Returns

12.1 Returns will only be accepted provided that:

(a) the Buyer has complied with the provisions of clause 11.1; and

(b) the Company has agreed in writing to accept the return of the Goods; and

(c) the Goods are returned at the Buyer's cost within fourteen (14) days of the delivery date; and

(d) the Company will not be liable for Goods which have not been stored or used in a proper manner; and

(e) the Goods are returned in the condition in which they were delivered and with all packaging material, brochures and instruction material in as new condition as is reasonably possible in the circumstances.

12.2 Non-stocklist items or Goods made to the Buyer's specifications will not be acceptable for credit or return unless prior approval is given by the Company.

13. Warranty

13.1 Subject to the conditions of warranty set out in clause 13.2 the Company warrants that if any defect in any workmanship of the Company becomes apparent and is reported to the Company within twelve (12) months of the date of delivery (time being of the essence) then the Company will either (at the Company's sole discretion) replace or remedy the workmanship.

13.2 The conditions applicable to the warranty given by clause 13.1 are:

(a) the warranty shall not cover any defect or damage which may be caused or partly caused by or arise through:

(i) failure on the part of the Buyer to properly maintain any Goods; or

(ii) failure on the part of the Buyer to follow any instructions or guidelines provided by the Company; or

(iii) any use of any Goods otherwise than for any application specified on a quote or order form; or

(iv) the continued use of any Goods after any defect becomes apparent or would have become apparent to a reasonably prudent operator or user; or

(v) fair wear and tear, any accident or act of God.

(b) the warranty shall cease and the Company shall thereafter in no circumstances be liable under the terms of the warranty if the workmanship is repaired, altered or overhauled without the Company's consent.

(c) in respect of all claims the Company shall not be liable to compensate the Buyer for any delay in either replacing or remedying the workmanship or in properly assessing the Buyer's claim.

13.3 For Goods not manufactured by the Company, the warranty shall be the current warranty provided by the manufacturer of the Goods. The Company shall not be bound by nor be responsible for any term, condition, representation or warranty other than that which is given by the manufacturer of the Goods.

14. Consumer Guarantees Act 1993

14.1 If the Buyer is acquiring Goods for the purposes of a trade or business, the Buyer acknowledges that the provisions of the Consumer Guarantees Act 1993 do not apply to the supply of Goods by the Company to the Buyer.

15. Default and Consequences of Default

15.1 Interest on overdue invoices shall accrue daily from the date when payment becomes due, until the date of payment, at a rate of two and a half percent (2.5%) per calendar month (and at the Company's sole discretion such interest shall compound monthly at such a rate) after as well as before any judgment.

15.2 If the Buyer owes the Company any money the Buyer shall indemnify the Company from and against all costs and disbursements incurred by the Company in recovering the debt (including but not limited to internal administration fees, legal costs on a solicitor and own client basis, the Company's collection agency costs, and bank dishonour fees).

15.3 Without prejudice to any other remedies the Company may have, if at any time the Buyer is in breach of any obligation (including those relating to payment) under these terms and conditions the Company may suspend or terminate the supply of Goods to the Buyer. The Company will not be liable to the Buyer for any loss or damage the Buyer suffers because the Company has exercised its rights under this clause.

15.4 Without prejudice to the Company's other remedies at law the Company shall be entitled to cancel all or any part of any order of the Buyer which remains unfulfilled and all amounts owing to the Company shall, whether or not due for payment, become immediately payable if:

(a) any money payable to the Company becomes overdue, or in the Company's opinion the Buyer will be unable to make a payment when it falls due;

(b) the Buyer becomes insolvent, convenes a meeting with its creditors or proposes or enters into an arrangement with creditors, or makes an assignment for the benefit of its creditors; or

(c) a receiver, manager, liquidator (provisional or otherwise) or similar person is appointed in respect of the Buyer or any asset of the Buyer.

16. Cancellation

16.1 The Company may cancel any contract to which these terms and conditions apply or cancel delivery of Goods at any time before the Goods are delivered by giving written notice to the Buyer. On giving such notice the Company shall repay to the Buyer any money paid by the Buyer for the Goods. The Company shall not be liable for any loss or damage whatsoever arising from such cancellation.

16.2 In the event that the Buyer cancels delivery of Goods the Buyer shall be liable for any and all loss incurred (whether direct or indirect) by the Company as a direct result of the cancellation (including, but not limited to, any loss of profits).

16.3 Cancellation of orders for Goods made to the Buyer's specifications, or for non-stocklist items, will definitely not be accepted once production has commenced, or an order has been placed.

17. Privacy Act 1993

17.1 The Buyer authorises the Company or the Company's agent to:

(a) access, collect, retain and use any information about the Buyer;

(i) (including any overdue fines balance information held by the Ministry of Justice) for the purpose of assessing the Buyer's creditworthiness; or

(ii) for the purpose of marketing products and services to the Buyer.

(b) disclose information about the Buyer, whether collected by the Company from the Buyer directly or obtained by the Company from any other source, to any other credit provider or any credit reporting agency for the purposes of providing or obtaining a credit reference, debt collection or notifying a default by the Buyer.

17.2 Where the Buyer is an individual the authorities under clause 17.1 are authorities or consents for the purposes of the Privacy Act 1993.

17.3 The Buyer shall have the right to request the Company for a copy of the information about the Buyer retained by the Company and the right to request the Company to correct any incorrect information about the Buyer held by the Company.

18. General

18.1 The failure by the Company to enforce any provision of these terms and conditions shall not be treated as a waiver of that provision, nor shall it affect the Company's right to subsequently enforce that provision. If any provision of these terms and conditions shall be invalid, void, illegal or unenforceable the validity, existence, legality and enforceability of the remaining provisions shall not be affected, prejudiced or impaired.

18.2 These terms and conditions and any contract to which they apply shall be governed by the laws of New Zealand and are subject to the jurisdiction of the courts of New Zealand.

18.3 The Company shall be under no liability whatsoever to the Buyer for any indirect and/or consequential loss and/or expense (including loss of profit) suffered by the Buyer arising out of a breach by the Company of these terms and conditions (alternatively the Company's liability shall be limited to damages which under no circumstances shall exceed the Price of the Goods).

18.4 The Buyer shall not be entitled to set off against, or deduct from the Price, any sums owed or claimed to be owed to the Buyer by the Company nor to withhold payment of any invoice because part of that invoice is in dispute.

18.5 The Company may license or sub-contract all or any part of its rights and obligations without the Buyer's consent.

18.6 The Buyer agrees that the Company may amend these terms and conditions at any time. If the Company makes a change to these terms and conditions, then that change will take effect from the date on which the Company notifies the Buyer of such change. The Buyer will be taken to have accepted such changes if the Buyer makes a further request for the Company to provide Goods to the Buyer.

18.7 Neither party shall be liable for any default due to any act of God, war, terrorism, strike, lock-out, industrial action, fire, flood, storm or other event beyond the reasonable control of either party.

18.8 The Buyer warrants that it has the power to enter into this agreement and has obtained all necessary authorisations to allow it to do so, it is not insolvent and that this agreement creates binding and valid legal obligations on it.