General Terms and Conditions of Sale

Carmel Cosmetics Labs is a limited liability company (Société A Responsabilité Limitée) incorporated under Moroccan law with a share capital of 1,000,000 MAD, registered with the Trade and Companies Register of Agadir under number 25081 and whose registered office is located at B1006 ZI Ait Melloul (the "Seller").

ARTICLE 1 – SCOPE AND PURPOSE

1.1. Purpose and Scope These General Terms and Conditions of Sale and Contract Manufacturing (hereinafter the "GTC") define the rights and obligations of the parties in connection with the sale of cosmetic products, services, development (R&D), contract manufacturing (Private Label) and white label sales (White Label) carried out by CARMEL COSMETICS LABS (hereinafter the "Laboratory") for any professional buyer (hereinafter the "Client"), whether established in Morocco or abroad.

1.2. Basis of Commercial Negotiation In accordance with trade practice and business law, these GTC constitute the sole basis of commercial negotiation. They apply without restriction or reservation to all orders placed with the Laboratory, regardless of any clauses appearing in the Client's documents, including its general terms and conditions of purchase.

1.3. Precedence and Contractual Documents In the event of conflict, the contractual documents rank as follows, in decreasing order of priority:

1. The Contract Manufacturing Agreement or the specific Quote signed by both parties (Special Conditions).
2. These GTC.
3. The approved technical Specifications.

Accordingly, placing an order implies the Client's full and unreserved acceptance of these GTC, to the exclusion of any other document issued by the Client that has not been expressly countersigned by the Laboratory. The fact that the Laboratory does not, at any given time, invoke any provision of these GTC shall not be interpreted as a waiver of its right to invoke it later.

ARTICLE 2 – SPECIFICATIONS, TOLERANCES AND REGULATORY COMPLIANCE

2.1. Product Definition and Specifications The essential characteristics of the Products are defined:

• For "White Label" products: by the Laboratory's Standard Technical Data Sheets in force on the date of the order.
• For "Private Label" products (contract manufacturing): by the Specifications and/or the formula jointly approved by the Client and the Laboratory. Photographs, graphic representations or marketing descriptions on the Laboratory's website or brochures are provided for information only and have no contractual value. Only the physico-chemical and organoleptic specifications in the Technical Data Sheet or the Specifications bind the Laboratory.

2.2. Specific Nature of Natural Materials (Tolerance Clause) The Client acknowledges and accepts that the use of raw materials of natural, plant or mineral origin may cause slight variations from one production batch to another (color shade, texture, scent perception). These variations, inherent to the nature of the ingredients, do not constitute non-conformities and cannot justify either refusal of the goods or a refund request, provided the Product remains compliant with the physico-chemical specifications (pH, viscosity, density) defined in the Specifications.

2.3. Regulatory Compliance and Registration (DMP) The Laboratory guarantees that the Products are manufactured in accordance with Good Manufacturing Practices (GMP - ISO 22716 standard) and the Moroccan cosmetics regulations in force.

However, as distributor and brand owner, the Client bears full responsibility for placing the Products on the market ("Responsible Person"). As such:

• For Morocco: The Client expressly undertakes to carry out the mandatory registration of the products with the DMP (Directorate of Medicines and Pharmacy) before any sale, in accordance with Law 17-04 and the Code of Medicines and Pharmacy. The Laboratory will provide the technical elements of the Product Information File (PIF) required for this procedure.
• For Export: It is the Client's responsibility to verify that the formulas and labeling comply with the legislation of the destination country and to complete local registrations (e.g. CPNP Portal for Europe, FDA for the USA).

The Laboratory accepts no liability in the event of seizure, fine or market withdrawal resulting from a lack of registration or from regulatory non-compliance of marketing claims affixed by the Client.

2.4. Modification and Changes The Laboratory reserves the right to modify the composition of the Products at any time in order to comply with changes in legislation (e.g. a ban on a preservative by the DMP or the EU) or to improve Product quality.

ARTICLE 3 – ORDERS, APPROVAL AND NO RIGHT OF WITHDRAWAL

3.1. Formation of the Contract and Start of Work Every order for Products or contract manufacturing services is subject to a prior Quote. The contract is formed and the order becomes firm and final ("Confirmed Order") only when one of the following two conditions is met:

1. Administrative Approval: Signature of the Quote by the Client with the words "Approved" ("Bon pour accord").
2. Financial Approval: Actual receipt in the Laboratory's bank account of the agreed deposit (generally 70% of the total amount including tax).

The Laboratory will not start any development, procurement or production until the deposit has been received.

3.2. Technical Approval (Product and Packaging Proofs) Before industrial production, the Laboratory may submit formula samples and/or print proofs for labels and packaging to the Client.

• Effect of approval: The Client's approval of these items (WhatsApp message, email, etc.) constitutes irrevocable acceptance of the organoleptic characteristics (texture, scent, color) and of the graphic design.
• Liability: Once the proof is approved, no claim will be accepted regarding items that match the approved sample or file. The Client is solely responsible for any errors (text, spelling mistakes, color choices) not corrected at the approval stage.

3.3. WITHDRAWAL As the Client contracts in a professional capacity, it expressly acknowledges that it has no right of withdrawal. Consequently, any approved order and any deposit paid are definitively and fully retained by the Laboratory.

The Client accepts this strict No-Refund policy, based on the following industrial realities:

• Order approval immediately triggers unavoidable costs for the Laboratory (booking of R&D slots, stability studies, sourcing and purchase of specific raw materials, mobilization of the Design teams).
• The deposit paid also constitutes partial consideration for the Development costs (flat value of €10,000 per SKU), which are incurred from day one.

3.4. Cancellation and Subjective Dissatisfaction No request for cancellation or refund, in whole or in part, will be accepted, whatever the reason given by the Client, in particular:

• A change in the Client's commercial strategy or financial difficulties.
• Abandonment of the project.
• Subjective dissatisfaction: As the Laboratory is bound by an obligation of means (and not of artistic result), the fact that the Client is not "satisfied" with the design or formula proposals, where the Laboratory has delivered work in line with good professional practice, does not constitute valid grounds for cancellation or refund.

3.5. Consequences of Cancellation If the Client attempts to cancel after the order has been confirmed:

• If production has not started: The Laboratory retains the full deposit paid as contractual compensation and as payment for the study costs already incurred.
• If production has started or specific materials have been purchased: The Client remains liable for 100% (one hundred percent) of the total order amount including tax. The Laboratory may demand payment of the balance by any legal means.

In the exceptional event that the Laboratory agrees, at its sole discretion and purely as a commercial gesture, to depart from its no-refund policy, it is expressly agreed that any return of sums will be made exclusively in the form of a CREDIT NOTE to be used against a future order (valid for 12 months). No refund in cash, by bank transfer or by check will ever be made. The Client expressly waives any right to demand a financial refund, the credit note being the only mode of settlement discharging the Laboratory.

ARTICLE 4 – DEVELOPMENT PROCESS AND TECHNICAL AUTHORITY

4.1. Contractual Hierarchy (Fundamental Clause) The parties expressly agree that the contractual basis of the order consists solely of the approved Quote and these General Terms and Conditions (GTC). Ancillary documents exchanged during the project phase, such as "Development Forms", "Design Sheets" or Marketing Briefs, are functional communication tools intended to guide the Laboratory's work. They have no contractual value superior to the Quote. In the event of a discrepancy between a handwritten note by the Client on a form and the technical specifications adopted by the Laboratory to ensure product viability, the Quote and the Laboratory's expertise prevail.

4.2. Expert Role and Technical Latitude As an industrial specialist, the Laboratory is bound by an obligation of means to achieve the cosmetic objective sought by the Client. The Client grants the Laboratory, as an expert, full latitude and technical authority to:

• Adjust, modify or optimize the formula (ingredients, preservatives, texturizing agents) relative to the wishes expressed in the forms, in order to ensure the stability, safety or regulatory compliance of the Product.
• Adapt design elements (layout, printing constraints) to ensure legibility and compliance with labeling standards.

These technical adjustments, necessary to complete the work properly, shall not constitute grounds for a claim by the Client as long as the overall objective and the quality of the finished Product are respected.

4.3. Responsibility for Content Supplied The Client is solely responsible for the accuracy of the information it enters in the forms (brand name, marketing copy, color codes, addresses). The Laboratory performs the work on the basis of this data but cannot be held liable for input errors, omissions or questionable aesthetic choices made by the Client in these forms.

ARTICLE 5 – PRICING AND PAYMENT

5.1. Prices The Products are sold at the prices stated in the Quote approved by the Client. Prices are expressed in Moroccan Dirhams (MAD), Euros (€) or US Dollars ($) depending on the currency chosen in the quote, and are exclusive of tax and of transport costs (Ex-Works), unless explicitly stated otherwise (e.g. DAP or CIF).

5.2. Payment Terms Unless special conditions are specified in the Quote, orders are paid according to the following schedule:

• A deposit of 70% (seventy percent) of the total amount including tax upon order approval. This deposit triggers the development process, raw material purchasing and production planning.
• A balance of 30% (thirty percent) before shipment of the goods or their release at the factory.

5.3. Late Payment and Suspension No production will be started until the 70% deposit has actually been received. Likewise, no goods will leave the Laboratory's warehouses until the balance has been paid in full. The Laboratory reserves the right to suspend performance of the order and to withhold the goods in the event of late payment, without this giving rise to any late-performance penalties against the Laboratory.

5.4. Price Changes Quote prices are firm for the quote's validity period (7 days). After this period, or for recurring orders (reorders), the Laboratory reserves the right to revise its prices at any time, in particular in the event of a significant change in the cost of raw materials, packaging or exchange rates. New prices will be communicated to the Client before any new order approval.

5.5. Price Revision Following Technical Changes The Laboratory reserves the right to revise the unit price of the Products or the total order amount in the event of a change requested by the Client during the project, affecting in particular:

• The formula (change of ingredients or concentration).
• Primary packaging (change of bottle, jar or pump).
• Secondary packaging (addition or modification of a carton or insert).
• Labels (change of material, finish or dimensions).

Any additional cost generated by these changes (machine setup costs, material loss, extra labor time, new purchases) will be invoiced to the Client. Withholding of goods: Where an additional cost has been approved, the order may only be released and shipped after full payment of the outstanding balances or supplementary invoices relating to the modified services.

ARTICLE 6 – DELIVERY, STORAGE AND EXPORT

6.1. Release and Lead Times Delivery is deemed to have taken place once the goods are made available at the Laboratory's factory (Incoterm EX-WORKS - Agadir). Any delivery lead times communicated are given for information only and depend on the availability of raw materials and production cycles. A reasonable delay cannot justify cancellation of the order or the award of penalties.

6.2. Storage and Collection Fees (Warehousing Clause) The Client must collect the goods within a maximum of 15 (fifteen) calendar days following the notice of availability.

• Grace period: Storage is free during these first 15 days.
• Storage penalties: Beyond this period, and whatever the reason for the delay (including problems with the Client's carrier), the Laboratory will invoice storage and custody fees at a flat rate of 200 MAD (or 20 EUR / 20 USD) per calendar day of delay. Payment of these storage fees is a precondition for handover of the goods. After 90 days without collection, the Laboratory may dispose of the goods, without refund of the amounts paid.

6.3. Export Specifics: Mandatory Transit Fees For export sales (outside Morocco), although the Incoterm is EX-WORKS (transport at the Client's expense), the Client must pay the Transit Fees invoiced by the Laboratory. This service is mandatory to ensure control over the export customs declaration. It enables the Laboratory to guarantee proper completion of Moroccan customs formalities and to obtain the legal export documents (DUM) required for its VAT exemption. The Client cannot opt out of it, even if it has its own freight forwarder for international transport.

6.4. Transfer of Risk Notwithstanding the retention of title clause, the risks of loss or damage to the goods pass to the Client as soon as they are made available at the factory or handed over to the first carrier. The Client is responsible for taking out insurance covering transport.

ARTICLE 7 – RETENTION OF TITLE AND TRANSFER OF RISK

7.1. Retention of Title Clause (Law 15-95 on the Commercial Code) Transfer of ownership of the Products is expressly suspended until full and actual payment of the price in principal and ancillary amounts (taxes, transit fees, any late-payment interest).

• Definition of Payment: The delivery of an instrument creating an obligation to pay (bill of exchange, uncashed check) does not constitute payment within the meaning of this clause. Only the actual receipt of funds in the Laboratory's bank account transfers ownership.
• Authorization to Resell and Subrogation: The Client is authorized, in the normal course of its business, to resell the Products delivered. However, it then assigns to the Laboratory, up to the amount of its debt, all receivables arising in its favor from resale to third-party buyers (Subrogation of receivables). In the event of non-payment, the Laboratory may claim the price directly from the Client's end customers.
• Prohibitions: The Client is, however, strictly prohibited from pledging the goods or transferring ownership of them as security.

7.2. Claim for Recovery and Return In the event of total or partial non-payment on the due date, the Laboratory may, without prior formal notice, demand by registered letter the return of the Products at the Client's cost and risk.

• Return Penalty Clause: If the Laboratory has to take back the goods, any deposits already paid will be retained by the Laboratory as damages to compensate for the loss in value of the goods and the commercial loss (breach of contract).
• Identification (FIFO Rule): Goods in stock at the Client's premises are presumed to be the unpaid goods. Any product of the same reference and quality found at the Client's premises will be allocated first to settling the Laboratory's claim according to the "First In, First Out" rule.

7.3. Safeguard and Insolvency Proceedings In the event of attachment, or the opening of safeguard, receivership or judicial liquidation proceedings against the Client, the Client undertakes to:

1. Notify the Laboratory immediately so that it can exercise its right of recovery.
2. Draw up without delay an inventory of the Products in its possession that are owned by the Laboratory.
3. Inform the officers of the proceedings (Trustee) of the existence of this retention of title clause.

7.4. Transfer of Risk (Independent of Ownership) Important: The transfer of risk takes place independently of the transfer of ownership. In accordance with the EX-WORKS Incoterm, the risks of loss, theft, deterioration or damage caused to or by the Products pass to the Client as soon as they are made available at the Laboratory's premises or handed over to the first carrier (even if that carrier is appointed by the Laboratory). Consequently:

• The Client alone is responsible for damage occurring during transport, loading and unloading.
• The Client undertakes to take out "Ad Valorem" insurance covering the goods for their full value from the transfer of risk, even if it does not yet own them. Lack of insurance shall not engage the Laboratory's liability.

ARTICLE 8 – ACCEPTANCE, QUALITY WARRANTY AND LIABILITY

8.1. Acceptance and Apparent Defects (Short Deadline) The Client must check the condition, quantity and conformity of the Products upon receipt (or collection at the factory). Any claim relating to apparent defects (missing products, breakage, visible labeling errors, damaged cartons) must be made in writing (email with supporting photos) within 3 (three) business days of receipt. After this period, the Products will be deemed compliant and accepted without reservation, and no such claim will be accepted.

8.2. Warranty Against Hidden Defects and Quality Control The Laboratory guarantees that the Products conform to the approved formula and to applicable hygiene standards (microbiology). In the event of a claim concerning the intrinsic quality of the product (texture, scent, stability) arising after the 3-day period (Hidden Defect):

• Retained Sample Procedure (Evidence Clause): For each batch manufactured, the Laboratory keeps retained samples in its sample library, stored under standardized conditions. In the event of a dispute, analysis of the Laboratory's retained sample shall be authoritative.
• • If the retained sample shows the same defect: The Laboratory acknowledges its liability.
  • If the retained sample is compliant: The defect is presumed to result from the Client's storage or transport conditions, and the warranty is excluded.

8.3. Warranty Exclusions The Laboratory's warranty is strictly excluded in the following cases:

• Improper Storage: Deterioration of products due to storage by the Client that does not follow the recommendations (exposure to heat > 25°C, humidity, direct light, frost).
• Transport: Damage occurring during transport (breakage, leakage due to heat in trucks/containers), the risks being borne by the Client (Incoterm EX-WORKS).
• Modification: If the Client or a third party has repackaged, mixed or modified the Product.
• Unsold goods: No return of goods will be accepted on the grounds of poor sales or insufficient stock turnover at the Client's end.

8.4. Implementation In the event of a proven defect acknowledged by the Laboratory:

• The warranty is strictly limited, at the Laboratory's option, to replacement of the defective products with identical products (subject to available stock) or to the issue of a credit note for the amount of the products concerned.
• Any notion of "repair" is excluded given the nature of the goods.
• Return costs are borne by the Laboratory only if its liability has first been acknowledged in writing.

8.5. Limitation of Liability (Cap) The Laboratory's civil liability, on any grounds whatsoever (except gross negligence or willful misconduct), is expressly limited to the amount, excluding tax, of the order that gave rise to the damage. Under no circumstances shall the Laboratory be required to compensate intangible or indirect damage such as: operating loss, loss of profit, loss of opportunity, damage to the Client's brand image, or market withdrawal costs (unless the withdrawal is ordered by the health authorities for a cause attributable to manufacturing).

ARTICLE 9 – FORCE MAJEURE AND EXEMPTION

9.1. Definition and Suspension The Laboratory shall not be held liable if the non-performance or delayed performance of any of its obligations results from a case of force majeure. In addition to those usually recognized by the case law of the Moroccan courts and tribunals, the following are considered cases of force majeure:

• Total or partial strikes (internal or external), lockouts, bad weather, epidemics, blockage of means of transport or supply.
• Cosmetics-specific: Global or local shortage of plant raw materials (poor harvest) or of packaging components, or late delivery by suppliers imposed by the Client.
• Sudden regulatory changes issued by the DMP or customs preventing production or export.

9.2. Effects The occurrence of such an event suspends performance of the contractual obligations. If the impediment lasts more than 45 days, the contract may be terminated automatically by either party, without any compensation being due by either side.

ARTICLE 10 – LIMITATION OF LIABILITY AND LIMITATION PERIOD

10.1. Exclusion of Indirect Damage In all cases, the Laboratory's liability is strictly limited to direct material damage. The following intangible or indirect damages are expressly excluded from any compensation:

• Operating loss, loss of profit, loss of earnings.
• Damage to the image or reputation of the Client's brand.
• Costs incurred by the Client for a product recall (unless ordered by health authorities due to a proven fault of the Laboratory).
• Late-delivery penalties that the Client's customers (e.g. Retail chains) may impose on it.

10.2. Liability Cap If the Laboratory's financial liability is established by a court, the total amount of compensation payable by it may in no event exceed the amount, excluding tax, of the order giving rise to the dispute.

10.3. Export Compliance The Products are guaranteed to comply with the Moroccan regulations in force. In the event of export, the Laboratory cannot be held liable for non-compliance with the legislation of the destination country (ban on an ingredient, specific labeling standards). It is the Client's responsibility, as exporter/importer, to verify such local compliance.

10.4. Shortened Limitation Period By way of derogation from the statutory provisions, the parties agree that any legal action by the Client against the Laboratory must be brought within one (1) year of the delivery date of the products in dispute. After this period, any action will be time-barred and inadmissible.

ARTICLE 11 – INTELLECTUAL PROPERTY AND CONFIDENTIALITY

11.1. Rights of the Laboratory The Laboratory retains full intellectual property of its know-how, manufacturing processes and formulas. Payment of the price by the Client does not transfer any intellectual property in these elements, but only a right to use and resell the physical products. Any attempt by the Client to "Reverse Engineer" (analyze in order to copy) the formula is strictly prohibited and will constitute serious misconduct.

11.2. Rights of the Client The Client remains the sole owner of its trademarks, logos and the graphic elements it supplies for labeling. It warrants to the Laboratory that it holds all rights to these elements and indemnifies it against any infringement action brought by third parties.

11.3. Confidentiality Each party undertakes to keep strictly confidential the technical, commercial and financial information received from the other party during performance of the contract, for a period of 5 years after the end of the business relationship.

ARTICLE 12 – DATA PROTECTION (LAW 09-08)

In accordance with Law 09-08 on the protection of individuals with regard to the processing of personal data, the Client has a right of access, rectification and objection regarding data concerning it. This data is processed by the Laboratory solely for order management and invoicing.

ARTICLE 13 – SEVERABILITY

If any provision of these GTC is annulled or declared unenforceable by a competent court, such nullity shall not affect the validity of the other clauses, which shall remain in force between the parties.

ARTICLE 14 – GOVERNING LAW AND JURISDICTION

14.1. Governing Law These General Terms and Conditions and the transactions arising from them are governed exclusively by Moroccan Law.

14.2. Jurisdiction Clause In the event of a dispute arising from the interpretation or performance of these terms, the parties will endeavor to find an amicable solution. Failing an amicable agreement within 30 days, the dispute will be submitted to the exclusive jurisdiction of the COMMERCIAL COURT OF AGADIR (TRIBUNAL DE COMMERCE D'AGADIR), notwithstanding multiple defendants, third-party claims or summary proceedings.