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Guarantee

  1. Extent of Guarantee
    1. The Guarantor hereby agrees, subject to these Conditions of Guarantee set out herein, to guarantee to the Beneficiary the performance of the Coatings System on the Guaranteed Area when professionally applied to the Yacht as per the Guarantor provided Coatings Specification.
    2. The obligations of the Guarantor under this Guarantee shall be in effect from the Commencement Date through the expiration of the Guarantee Period for the Yacht.
    3. The Commencement date means the date the Yacht leaves the controlled environment of the construction hall or application enclosure and first becomes exposed to the natural atmospheric elements. This date shall be no later than four (4) months after the date of completion of the application of the Coatings System.
    4. Any repairs carried out under this Guarantee do not extend the duration of this Guarantee.
    5. The Clients agree that the Beneficiary has the sole right to claim under this Guarantee and they agree to cooperate fully with the Beneficiary and Guarantor to fulfil all their obligations as specified in this Guarantee.
  2. Defective Areas
    1. The Guarantor shall be liable only for “Defective Areas” which throughout this Guarantee shall mean an aggregated surface area exceeding two percent (2%) of the total surface of the Guaranteed Area (excluding those areas and defects referred to in Clause 4) where non-destructive testing shows that:
      1. On visual inspection spontaneous detachment of the coatings comprised in the Coatings System from each other, or from the substrate, has occurred; or
      2. In the case of a steel substrate, on visual inspection that the steel has corroded to a severity greater than Ri.2 as defined in ISO 4628-3:2003; or
      3. The Paint System has on visual inspection blistered, cracked and/or peeled above the size 2 quantity (density) 2, as defined in ISO 4628/2-4-5; or
      4. The gloss level of the Paint System applied in accordance with the relevant Technical Data Sheet on the hull exterior above the waterline, or the superstructure exterior, is less than eighty percent (80%) in the first twelve (12) months, or sixty percent (60%) in months twelve (12) to eighteen (18), of the original gloss level, measured at an angle of sixty (60) degrees in accordance with the measurement of specular gloss of non-metallic paint films as defined in ISO 2813:2000; or
      5. The colour level of the Paint System on the hull exterior above the waterline or the superstructure exterior has changed by more than:
        1. (i) Delta E5 (De 5) for all colours up to twelve (12) months; or
        2. Delta E7.5 (De 7.5) for all colours up to eighteen (18) months; when measured in accordance with ISO 11664-4:2008 (CIE S 014-4/E:2007).
    2. In the case of maintenance, repaints, refits or repairs of an existing Yacht, Clauses 2.1(a), 2.1(b) and 2.1(c) shall not apply and are not covered by this Guarantee.
  3. General Conditions
  4. The Guarantor shall not be liable for a claim unless:
    1. The following procedures have been adhered to and completed in full:
      1. For a new build Yacht less than thirty (30) meters in overall length and all Yacht maintenance, repaints, refits and repairs:
        1. Contract of Guarantee online registration completed;
        2. Coatings System applied to the Yacht as per standard Guarantor published Coatings Specification; and
        3. Application log kept to record: equipment used & settings, environmental conditions during application and quantity and batch numbers of products applied.
      2. For a new build Yacht thirty (30) to fifty (50) meters in overall length:
        1. Contract of Guarantee signed on the behalf of the Guarantor, Owner, Yard and Applicator prior to application of Coatings;
        2. Coatings System applied as per Guarantor provided Coatings Specification issued for the Yacht; and
        3. Application log kept to record: equipment used & settings, environmental conditions during application and quantity and batch numbers of products applied.
      3. For a new build Yacht over fifty (50) meters in overall length:
        1. Completion of a Pre-Project Meeting with the Guarantor, Owner, Yard and Applicator;
        2. Contract of Guarantee signed on the behalf of the Guarantor, Owner, Yard and Applicator prior to application of Coatings;
        3. Coatings System applied as per Guarantor provided Coatings Specification issued for the Yacht; and
        4. Application log kept to record: equipment used & settings, environmental conditions during application and quantity and batch numbers of products applied;
    2. Any surfaces and coatings damaged during work on the Yacht have been repaired to the Guarantor’s Coatings Specification;
    3. All normal maintenance procedures (including without limitation all cleaning and washing procedures) are in line with the Guarantor’s recommendations and have been duly carried out; and
    4. The defects are due to an inherent defect in the Coatings that results in Defective Areas as defined in Clause 2.1 above.
  5. Exclusions
  6. The Guarantor shall not be liable for:
    1. Damage to the Coatings System arising from external causes outside the control of the Guarantor including (but not limited to) welding or other heating, pollution, mechanical damage, electrical or electrolytic damage, incorrect cleaning or incorrect use, neglect, fire, explosion, radiation or other accident, acts of God, wars (whether declared or not), riot, civil commotion, vandalism or other malicious damage, industrial action, adverse weather conditions (such as, for example, sandstorms) and the like;
    2. Coatings on surface areas which because of their physical shape, characteristics or configuration present special difficulties in effecting specified preparation and coating, including (but not limited to) ladders, handrails and all small area equipment and attachments, and the like;
    3. Deterioration of the substrate caused by electro-chemical action arising from the presence of metals which are cathodic to the metal of those areas of the Yacht covered by this Guarantee;
    4. In the case of maintenance, repaints, refits or repairs of an existing Yacht, any faults and/or defects caused by or related to already present coatings and coatings which have not been removed to the bare substrate;
    5. Deterioration of any part of the Coatings System caused by work carried out on the Yacht including (but not limited to) polishing or any other form of surface treatment;
    6. Any delay or failure by the Guarantor to carry out its obligations under this Guarantee arising out of circumstances beyond its control including (but not limited to) riot, civil commotion, industrial action and the like;
    7. Cracks or delamination in the Coatings System caused by substrate flexing or movement. The Yard is responsible for ensuring that the construction and design is appropriate for the chosen Coatings System, specifically for fairing with the chosen epoxy filler system, without causing it to crack or to delaminate;
    8. Antifouling & foul release coatings. As the performance of antifouling is influenced by factors beyond our control, antifouling performance is specifically excluded from this Guarantee. Foul release coatings are handled as a separate process and are excluded from this Guarantee;
    9. Performance on Wood. As wood is a natural material and the performance of coatings or varnishes will depend for a large part on the quality of the wood and its construction, these parts are specifically excluded from this Guarantee; or
    10. Tanks, Flooring & Insulation. Due to the more complex nature of application and maintenance, these parts are specifically excluded from this Guarantee.
  7. Claims
  8. In the event of a failure of the Coatings System as defined in Clause 2.1:
    1. The Beneficiary shall notify the Guarantor of any claim by certified or registered mail (in each case, return receipt requested, postage prepaid) to the address of the Guarantor set forth in the Contract of Guarantee giving full details of the nature of the defect, the size and area, and the circumstances in which it was discovered including the date of detection, the location of the Yacht and whether it is out of water or not. Unless this written notice is received by the Guarantor within thirty (30) days of the date of detection of the defect all claims to which such notice relates shall automatically be excluded and time barred thereafter;
    2. If the Guarantor wishes to inspect the area of the Yacht in respect of which a claim is made, the Yacht shall be made available for such inspection as soon as reasonably practicable and in any event within sixty (60) days of receiving such request at the location at which the Yacht was originally coated or such other location as may be mutually agreed between the Guarantor and the Beneficiary. The Yacht will be made available for the Guarantor’s inspection within such period and prior to any repair work being carried out, failing which the Guarantor shall have no liability to the Beneficiary whether under this Guarantee or otherwise;
    3. The Beneficiary shall, in the event of a claim, make available to the Guarantor records showing the environment to which all areas of the Yacht covered by this Guarantee have been exposed since initial application of the Coatings System such as, but not limited to: surface treating, washing/cleaning procedures used and any other data needed to re-construct the chronological service history of the Yacht;
    4. As Beneficiary’s sole exclusive remedy for breach of warranty and/or any other alleged claim relating to the Coatings System, the Guarantor will, subject to these Conditions of Guarantee, supply the Coatings to effect the repair of the Defective Areas and shall cover the reasonable costs of application of such Coatings as follows:
      1. for any claims received during the first twelve (12) months from the Commencement Date: one hundred percent (100%) of such costs; and
      2. for any claims received after the first twelve (12) months from the Commencement Date until the expiration of the Guarantee Period: seventy-five percent (75%) of such costs;
    5. The Guarantor shall, subject to these Conditions of Guarantee, reimburse the Beneficiary for the reasonable costs of scaffolding and tenting to the extent that they are directly attributable to the repair of the Defective Areas against written evidence of such costs actually incurred.
    6. It shall be the Beneficiary’s burden when making any claim under this Guarantee to show that Defective Areas:
      1. were not caused by failure to comply with the conditions set out in Clause 3; and
      2. do not fall within any of the exclusions set out in Clause 4;
    7. No acceptance of any claim by the Guarantor shall be effective unless it is explicitly communicated to the Beneficiary in writing by the Guarantor; and
    8. Repairs under this Guarantee may only be carried out after consultation with the Guarantor who reserves the right to approve or negotiate the contracts for such repairs which shall be carried out as soon as practicable, but the Guarantor does not assume liability for delay in carrying out or completion thereof. For the avoidance of doubt, the Beneficiary agrees that the Guarantor shall not have any responsibility and/or liability for the negotiation and/or management of any contract for such repairs and shall not be a party to any such contract.
  9. Disclaimer; Limitation of Liability
    1. EXCEPT AS SET FORTH IN THIS GURANTEE, GUARANTOR MAKES NO REPRESENTATIONS OR WARRANTIES, EXPRESS OR IMPLIED, ORAL OR WRITTEN, OF ANY KIND WITH RESPECT TO THE COATINGS SYSTEM AND DISCLAIMS ALL IMPLIED WARRANTIES INCLUDING WARRANTIES OF MECHANTABILITY OR FITNESS FOR ANY PARTICULAR PURPOSE.
    2. THE GUARANTOR’S ENTIRE AGGREGATE LIABILITY FOR ANY CLAIM OR CLAIMS UNDER CLAUSES 5(D) AND 5(E) OF THIS GUARANTEE FOR A NEW BUILD YACHT SHALL NOT EXCEED FOUR (4) TIMES THE PURCHASE PRICE OF THE COATINGS IN THE DEFECTIVE AREAS, AND FOR MAINTENANCE, REPAINTS, REFITS OR REPAIRS SHALL NOT EXCEED FIVE (5) TIMES THE PURCHASE PRICE OF THE COATINGS DEEMED FAULTY.
    3. IN NO CIRCUMSTANCES WHATSOEVER SHALL THE GUARANTOR BE LIABLE FOR ANY DIRECT LOSSES OTHER THAN THOSE AMOUNTS DESCRIBED IN CLAUSES 5(D) AND 5(E) ABOVE, OR INDIRECT LOSSES INCLUDING (WITHOUT LIMITATION) DEMURRAGE, SLIPPING COSTS, HARBOR COSTS, HARBOR DUES, BOATYARD SERVICES AND THE LIKE ASSOCIATED WITH COATINGS REPAIR WORK, LOSS OF TIME, MONIES DUE TO THE BENEFICIARY’S EMPLOYEES OR TO OPERATORS OR CHARTERERS, LOSS OF PROFITS, LOST CONTRACTS, LOST OPPORTUNITY TO CONTRACT AND ANY SUCH SIMILAR COSTS AND ALL CLAIMS BY THIRD PARTIES AGAINST THE BENEFICIARY.
    4. The Beneficiary acknowledges that any associated or affiliated company of the Guarantor (“Affiliate”) has no liability whatsoever with respect to the Yacht, and the Beneficiary releases such Affiliates from any and all such liability. The liability of the Guarantor under this Guarantee is (subject to Clause 6(e)) in substitution for all other liability of the Guarantor and/or its Affiliates in connection with or relating to coatings, products and/or advice and assistance supplied in respect of the Yacht whether in contract, tort or otherwise.
    5. This Guarantee does not exclude or restrict liability for death or personal injury caused by the sole negligence of the Guarantor and/or its Affiliates.
  10. Indemnity
  11. The Beneficiary agrees that it will at all times from the Commencement Date hold harmless and indemnify the Guarantor against all third party claims for loss, damage or expenses including legal expenses brought against the Guarantor of whatsoever nature and howsoever arising caused by or related to the Coatings System, its application or repair under this Guarantee. This indemnity shall apply to all third party claims except claims relating to death or personal injury arising out of the Guarantor’s sole negligence in the performance of its obligations under this Guarantee.
  12. General
    1. The Guarantor’s Conditions of Sale applicable at the time of product purchase of the Coatings come into force immediately on sale of the Coatings by the Guarantor.
    2. This Guarantee and the Attachments attached hereto and forming a part hereof, sets out the complete, and final agreement and understanding between the Guarantor and the Clients relating to the subject matter of this Guarantee and supersede all prior oral or written agreements, understandings, representations, statements, and assurances. There are no warranties, representations, covenants, promises, agreements, conditions or understandings, either oral or written, between the Guarantor and the Clients other than as set forth in this Guarantee and the Attachments. Guarantor represents and acknowledges that Beneficiary is not relying upon any oral or written statement, warranty or representation by Guarantor, its employees, agents, and/or representatives not fully set forth in the Agreement. No alteration, amendment, change or addition to this Guarantee (including to any of the Attachments) shall be binding upon the Guarantor or the Clients unless made in writing and signed by authorized representatives for each of the Guarantor and the Clients.
    3. The Parties shall agree to use the dispute resolution mechanism set out in Clauses 8.3(a) and 8.4(b) below in the event that any claim or dispute arises under or in connection with this Guarantee:
      1. The Parties will attempt to settle such claim or dispute by good faith negotiations; and
      2. If any claim or dispute cannot be settled by negotiation within thirty (30) days after a written offer has been given to the other Parties to negotiate a settlement to such claim or dispute, the Parties shall, before resorting to court proceedings, attempt to resolve the claim or dispute by mediation in accordance with the Model Mediation Procedure of the Centre for Dispute Resolution (CEDR) in London.
    4. The Guarantee may not be assigned by the Clients without the Guarantor’s prior written consent.
    5. This Guarantee shall be subject to English Law.