TERMINOLOGY

Definitions and Interpretation

1. Definition

• a. Added Value Facilitators (AVF) is a registered company in Poland (Europe). It owns a software trading platform that facilitates a Buyer and Seller to accept a Firm Bid;
• b. Commodities refer to raw materials, primary products or goods that are traded on commodity exchanges. These Commodities are generally uniform in quality and to Standard Specifications, allowing them to be interchangeable with other Commodities of the same type. The Commodities traded are listed by AVF. Commodities for the purposes of this AVF platform includes Transport Services. The exception is where the Launcher specifies in sufficient detail a commodity he wishes to trade with that is not listed on the AVF Platform;
• c. Products or Goods Where the terms Products or goods as used they relate to the Commodities that are listed on the AVF Platform or where the Launcher specifies in sufficient detail a commodity he wishes to trade with that is not listed on the AVF Platform;
• d. Commission, fees paid by Seller to AVF for facilitating and confirming the Firm Bid;
• e. Seller, is an entity who has been granted Membership of the AVF platform who possesses and transfers ownership of the Commodities for sale. The Seller as part of his Membership application sends to AVF a copy of his standard Sales contract. The Seller’s representatives have authority to:
• i. Accept a Firm Bid Specification launched by a Buyer;
• ii. Launch a Firm Bid as a Commodity Producer for Buyers to Accept;
• iii. Launch a Firm Bid as a Commodity Trader for Buyers to Accept;
• f. Buyer, is an entity who has been granted Membership of the AVF platform and its representatives have authority to Launch and Accept a Firm Bid. The condition of Membership is that the entity is responsible for procuring:
• i. Commodities needed in their (or group company) product manufacturing process;
• ii. Commodities needed for trading;
• iii. Transport Services for the delivery of purchases made via the AVF platform or not;
• g. Trader, a legal entity having AVF Membership which buys and sells Commodities;
• h. Transporter is a Member of the AVF platform and its representatives have authority to accept a Firm Bid request launched by a Buyer for Transport Services. Based on the Collection Point, Delivery Point and the sold Commodities packaging and delivery specifications, the Transporter will make a Firm Bid to the Buyer. A Buyer, who is a member of the AVF Platform, not using the AVF facility to find a Seller may use this platform to request Transportation services from Transporter Members;
• i. Launcher (of Firm Bid), can be a Buyer, Seller or Trader;
• j. Acceptor (of Firm Bid), can be a Buyer, Trader, Seller or Transporter;
• k. General Terms the terms in the Terms of Reference;
• l. Firm Bid refers to a formal and binding offer (to contract) made by a Launcher (Buyer or Seller) for a Set Time to transact Commodities at a specified price and under defined terms, conditions and Specifications. Unlike preliminary or non-binding bids, a Firm Bid is considered a legal commitment that, once accepted, creates a binding contractual obligation between Buyer and Seller. This type of bid typically includes specific details such as pricing, delivery terms, Collection or Delivery Point, and other relevant conditions that both parties must adhere to upon acceptance of the Bid. The Firm Bid must explicitly specify the Set Time; beyond which the Firm Bid becomes void;
• m. Specification, Standard Specifications for Commodities listed on AVF. Other Specifications can be used if clearly defined. The Specification includes the quantity required, delivery terms, and any other relevant conditions that both parties must adhere to upon acceptance of the bid;
• n. Membershipof the AVF platform is required before an entity can become a Buyer, Seller, Trader or Transporter. Membership application is checked by the AVF platform and its staff make the final verification. Membership acceptation is solely at the discretion of AVF staff;
• o. Contractthere are two contracts:
  • i. Between AVF and its Members which binds the Seller to the Commission that is generated from transactions between the Launcher and Acceptor;
  • ii. Between the Launcher and Acceptor, based on the Terms of Reference and in addition on confirming the Firm Bid the Sellers Standard Contract, binding these parties to their commercial transaction. These contracts result from the binding Firm Bids;
• p. Set Time, the duration of the Firm Bid launch is 24 hours. This validity may be extended by Launcher of the Firm Bid if the deadline coincides with a public holiday or a weekend in the country where Launcher is located;
• q. Collection Point is the place designated by GPS coordinates and other details, from where the Goods are to be collected, The Firm Bid terms and process, including the its Acceptance Confirmation, cannot include any information relating to the Collection Point except GPS coordinates;
• r. Delivery Point is the place designated by GPS coordinates and other details, to where the Goods are to be delivered. The Firm Bid terms and process, including the its Acceptance Confirmation, cannot include any information relating to the Delivery Point except GPS coordinates;
• s. EXW or Ex works, in an "ex works" arrangement, Seller fulfils his responsibility by making the Commodities available at their premises or another named place (factory, warehouse, etc.). Buyer is then responsible for all costs and risks associated with transporting the goods from that location to their final destination. This term is part of the Incoterms;
• t. FOB or Free On Board, is a shipping and international trade term. FOB indicates the point at which the seller fulfils their responsibility for the goods being transported;
• u. Tracking Number System gives the status of the Commodity collection and delivery status, including Goods delivery date;
• v. Liability of a Seller relates to unpaid Commission to AVF for facilitating the Firm Bid. The role of AVF is completed on confirming a Firm Bid made between Launcher and Acceptor and Seller paying the Commission to AVF. AVF is not a party to the contract between Launcher and Receiver;
• w. Incoterms, stands for International Commercial Terms. Incoterms are a set of standardised international trade terms published by the International Chamber of Commerce (ICC). These terms are widely used in international contracts for the sale of goods and provide a common set of rules and definitions to clarify the responsibilities and obligations of Buyers and Sellers in the process of transporting goods;
• x. European Economic Area (EEA), The EEA includes EU countries and also Iceland, Liechtenstein and Norway. It allows them to be part of the EU 's single market. Switzerland is not an EU or EEA member but is part of the single market.

2. Launch Firm Bid

Launch Firm Bid, refers to the act of a Launcher to formally initiate a comprehensive and legally binding Firm Bid inviting Acceptors to accept the legally binding Firm Bid. When Launcher decides to launch a Firm Bid, he expresses a commitment to purchase or provide goods or services under specific conditions, including price, delivery terms, and other relevant details.

3. Firm Bid Validation

Firm Bid Validation, refers to the specified duration during which a Firm Bid, a formal and binding offer, remains valid and legally binding. This period is set by the Launcher of the Firm Bid and is stated within the Firm Bid documentation. Once the Firm Bid validation period expires, the Bid becomes void (invalid), and the terms and conditions outlined in the Bid are no longer binding on the Launcher. It is a crucial aspect of the bidding process, providing a clear timeframe within which the offered terms are applicable and can be accepted by the Acceptor. On the AVF platform, the validity of the Firm Bid is for a Set Time.

4. Counter Proposal

Counter Proposal, Where there are reservations or objections to the terms or conditions presented by the Launcher in the Firm Bid. This includes the Acceptor’s concerns about contractual terms, delivery schedules, or other aspects of the Firm Bid except price. Objections to a Firm Bid may result in suggesting modifications as a counteroffer. The aim is to reach a mutually beneficial agreement through negotiation. If price is not acceptable no Counter Proposal can be made. A new Firm Bid can be submitted with a revised price, whilst maintaining the other characteristics of the expired Firm Bid.

5. Firm Bid Acceptance

Firm Bid Acceptance, refers to the act of an Acceptor formally and legally accepting the terms and conditions of a Firm Bid. Acceptance occurs within the specified validation period. Once the bid is accepted, it forms a binding contractual agreement between the Launcher and Acceptor.

6. Transport

Transport, There are two ways that Members can use the Transport option on the AVF platform:

• a. Where a Firm Bid for Commodities (materials) is accepted, the Buyer has the opportunity to Launch a Firm Bid to a Transporter for the collection and delivery of the Commodities purchased;
• b. Where a Member has made a material purchase Transaction external to the AVF Platform and needs a Transporter, he can use the service of the AVF Platform to contract with a Transporter;

In both cases the Transporter (as the Seller) pays a Commission Fee to AVF for facilitating the Firm Bid.