Note:       The following English translation has been excerpted from the original Conditions of Sale in Japanese and is provided for reference purposes only. In the event of any discrepancy between the Japanese original and the English translation, the Japanese original shall prevail.

              

               Any new changes or corrections to the material printed in this catalogue will be announced on the day of the sale.

 

[TRANSLATION]

 

Conditions of Sale

 

Chapter 1       General Provisions

 

(Obligation to abide by Conditions)

Article 1             Any party registered to sell a horse at this sale (hereinafter eSellerf) and any party registered to buy any number of horses at this sale (hereinafter eBuyerf) must agree to abide by the conditions herein.

 

(Location of Sale)

Article 2    1.      This horse auction sale (hereinafter the eSalef) is to be held at 175-2 Kamimori, Shizunai-cho, Shizunai-gun, Hokkaido.

               2.   The main office is situated at the following location; however, a temporary office will be set up within the sales complex during the period of the Sale.

                     Main office: 2-1-1 Tsukiji, Urakawa-cho, Urakawa-gun, Hokkaido

                     Temporary Office: 175-2 Kamimori, Shizunai-cho, Shizunai-gun, Hokkaido

 

(Horses Offered in Sale)

Article 4             Horses offered in the Sale will be sold on an eas isf basis.

 

(Operating Hours of Sale)

Article 6             Operating hours of the Sale are from 6 a.m. to 8 p.m. However, if transactions involving the horses on offer are not completed during such time, such time may be extended.

 

(Keeping of Horses)

Article 7    1.      Only horses that have been diagnosed as being free of the domestic animal infectious diseases stipulated in Article 2 of the Domestic Animal Infectious Disease Control Law can be kept on the sales premises.

                  2.      Horses to be offered must be kept at a location designated by the Sale Holder.

                  3.      In the event the Sale Holder determines that a horse with any disease other than those stipulated in Article 2 of the Domestic Animal Infectious Disease Control Law or any bad habit and thus may pose a threat to other horses should be refused entry onto the premises or be isolated or have its movements restricted, Seller of such horse must comply with  the Sale Holderfs decision.

                  4.      Seller must receive a number tag and place it on the horse to be offered and follow the instructions of the sales attendants.

 

(Procedures for Veterinary Inspections)

Article 8    1.      Any party involved in the transaction of a horse may request for the veterinarian posted at the veterinary clinic set up within the sales premises on a particular day of the Sale to examine the horse for any illnesses.

                  2.      In the event a party involved in the transaction of a horse wishes to request such examination as described in the previous paragraph, the party must report the request to the sales office.

 

Chapter 2    Method of Transaction and Procedures

 

 (Method of Purchase and Sale)

Article 10  1.      Horses will be offered in the order designated by the Sale Holder.

                  2.      The auction shall be conducted in principle through increasing of bids. However, bids may be brought down at the discretion of the auctioneer. The minimum bid advance shall be Ten thousand (10,000) yen.

 

(Re-Sale)

Article 11  1.      If there is no successful bidder for a horse, Seller may put the horse up for re-sale.

                  2.      Any party wishing to put a horse up for re-sale in accordance with the previous paragraph must immediately notify the sales office of such intention.

                  3.      Re-sales for each day will be conducted in the order determined by the Sale Director.

 

(Seller Registration)

Article12   1.      The Seller, being responsible for any dispute that may occur between Seller and owner of the horse to be offered, must register with the sales office by filing out a Sales Application Form designated by the Sale Holder specifying the name and address of Seller, name and address of the owner, name and address of the breeding farm and actual keeper of the horse, the horsefs breed, sex, color, date of birth and pedigree and submitting the completed form along with the Sales Application Fee stipulated in Article 27 (1) of these conditions and also a document certifying the horsefs pedigree.

                  2.      The Certificate of Foal Registration issued by the Japan Race Horse Registry shall serve as the document certifying the horsefs pedigree. Horses must meet the following conditions for each sale.

                           (1)     Foal Sale

(a)  If the document to serve as the certificate of the horsefs pedigree has not been issued, Seller must certify the horsefs pedigree. It is the responsibility of Seller to submit the application for the horsefs Certificate of Foal Registration.

(b)  For the Foal Selection Sale, Seller must submit a copy of the Certificate of Covering on the horse along with the Sales Application Form.

(c)  For the Foal Autumn Sale, an application for the horsefs Certificate of Foal Registration must be submitted to the Japan Race Horse Registry by the day before the first day of the Sale.

(d)  If the horsefs Certificate of Foal Registration has not been issued, Seller must promptly submit said certificate to the Sale Holder upon its issuance.

                           (2)     Yearling and 2-Year-Old Sales

                           (a)  An Application for the horsefs Certificate of Foal Registration must be submitted to the Japan Race Horse Registry by the end of the sales application withdrawal period.

                           (b)  Seller must submit the horsefs Certificate of Foal Registration to the Sale Holder at the time of sales application. If, however, the Certificate of Foal Registration has not been issued at this time, Seller must certify the horsefs pedigree and submit said certificate to the Sale Holder upon its issuance by the day before the first day of the Sale at the latest.

                           (c)  For the Yearling Selection Sale, Seller must promptly submit the Certificate of Foal Registration to the Sale Holder upon its issuance.

                  3.      Seller must submit to the sales office before the beginning of the Sale documents to declare any of the conditions stated in Article 16 of these Conditions of Sale and a preferred sale price for the horse.

                  4.      If it is discovered before the horse is offered at the Sale that Seller has submitted false information or if the Certificate of Foal Registration of the horse to be offered at the Yearling or 2-Year-Old Sale has not been submitted to the Sale Holder by the day before the first day of the Sale or if the Sale Holder deems it necessary for any particular reason, the Sale Holder may refuse to have the horse offered at the Sale.

 

(Withdrawal of Horse)

Article 13  1.      In the event that a horse for which a Sales Application Form has been submitted must be withdrawn from the Sale due to unavoidable reasons such as illness or accident, Seller must promptly notify the Sale Holder and submit any relevant veterinary certificates. For the Selection Sale and Foal Autumn Sale, the veterinary certificate must be prepared by a veterinarian approved by the Sale Holder.

                  2.      Upon receiving such notice as described in the previous paragraph, the Sale Holder must on the day of the Sale, make known the number and name of the horse and also the name of Seller by posting the information within the sales premises.

 

(Buyer Registration)

Article 14  1.      For each Sale, any party wishing to register as a buyer must fill out and submit an Agreement of Buyer Participation which will include information such as Buyerfs address and name at least 5 days before the beginning of the Sale.

                  2.      With respect to the previous paragraph, in the event Buyer wishes to authorize an agent to make purchases on his/her behalf, the agent may participate in the Sale if the Sale Holder so approves according to the Purchase Agent Authorization Form authorized by the Sale Holder.

                  3.      In the event a party is unable to complete the necessary procedures by the deadline date due to unavoidable circumstances, the party must register a certifier approved by the Sale Holder and complete the procedures stipulated in paragraph 1 of this article by the starting time of the sales day. If, however, the party is included in the Past Merit Buyers List separately compiled by the Sale Holder, a certifier may not be required provided it is so approved by the Sale Holder.

                  4.      Upon completion of buyer registration, Buyer will be issued a buyer registration number badge.

                  5.      Buyer must wear the buyer registration number badge where it is clearly visible.

 

(Deposits)

Article 15                    If Buyer has submitted an Agreement of Buyer Participation to the Sale Holder in accordance with Article 14 Paragraph 1 at least 5 days before the Sale, and if the Sale Holder so approves, Buyer may be exempt from the required deposit payment. A party seeking to register as a buyer during the 4 days prior to the Sale must pay a 50% deposit according to the expected number and value of purchases. However, exceptions may be allowed if the Sale Holder so approves.

 

(Announcements prior to Commencement of Auction)

Article 16  1.      The Sale Holder shall announce at the time of auction, in addition to information contained in the sales catalogue, any conditions in Paragraph 5 of this Article as declared by Seller.

                  2.      If there is any information to be added, or upon examination of the information listed in the sales catalogue, there are any corrections or inclusions to be made, Seller must make a request in writing to the Sale Holder for the correction or inclusion to be made before the beginning of the auction.

                  3.      In the event such request as described in the previous paragraph is made, the Sale Holder must announce the requested correction or inclusion at the auction stand.

                  4.      In the case of horses being offered in the Foal Sales and the Selection Sale for which the issue date of their Certificate of Foal Registration has not yet arrived, announcements must be made to that effect on the day of auction.

                  5.      The conditions to be declared as referred to in Paragraph 1 of this article are as follows:

                                 (1)           Bad habits (Cribbing, Box-Walking, Weaving, Self-Biting)

                           (2)  Eye abnormalities (Cataracts, Amaurosis, Glaucoma), Periodic Ophthalmia (Moonblindness)

                           (3)  History of joint surgery

                           (4)  History of abdominal surgery

                           (5)  Castration

                           (6)  Missing or damaged teeth

                           (7)  History of surgery under general anesthesia

                           (8)  For the Training Sale, roaring from laryngeal hemiplegia

 

(Determination of Successful Bidder and Conclusion of Purchase Transaction)

Article 17  1.      If after the auctioneer calls out the highest bid 3 or more times and there is no other higher bidder, the party making the highest bid shall be determined the successful bidder. However, if the value of said bid is lower than the preferred sale price submitted to the Sale Holder by Seller, such may not be the case.

                  2.      In either the Training Sale, Selection Sale or Foal Autumn Sale, in the event of the situation described in the previous paragraph, if the party making the highest bid is also the Seller, the party will not be determined the successful bidder and the horse will be declared as being bought back. The auctioneer or his/her assistant shall then announce immediately the price of the highest bid and Sellerfs registration number.

                  3.      The purchase transaction shall be deemed concluded upon the determination of the successful bidder. The auctioneer or his/her assistant shall then announce immediately the price of the successful bid and the name and or buyer registration number of the successful bidder.

               4.   No party may raise any objections once the auctioneer has determined the successful bidder.

               5.   All responsibility and risk of loss shall pass to the successful bidder at the time of conclusion of the purchase transaction except in situations pertaining to Articles 20 and 21 of these Conditions of Sale.

               6.   Once the successful bidder has been determined, the successful bidder and Seller shall sign and seal the designated Agreement of Purchase and Sale.

 

(Purchase Settlement)

Article 18  1.      After the successful bidder has been determined, the successful bidder shall pay the amount equal to the successful bidding price plus consumption tax (hereinafter the 'purchase pricef) in the form of cash in Japanese currency (hereinafter ecashf) or check to the sales office or make a cash wire-transfer of said amount to a financial institution designated by the Sale Holder no later than the closing time of the Sale.

                           If, however, due to unavoidable reasons the successful bidder is unable to pay the amount equal to the purchase price by the closing time of the Sale, and if the Sale Holder approves the payment conditions set forth by the successful bidder, payment may be extended as follows: for the Foal Selection Sale and Foal Autumn Sale, an amount equal to 50% of the purchase price shall be paid within 10 days from the day following the closing day of the Sale and the balance shall be paid by the end of March of the following year; for the Training Sale, payment shall be made within 7 days from the day following the closing day of the Sale; for all other sales, payment shall be made within 15 days from the day following the closing day of the Sale.

                     2.   The Sale Holder will not extend the time of payment stipulated in Paragraph 1 of this article regardless of whether Buyer has initiated the procedures set forth in Articles 20 and 21 of these Conditions of Sale.

                  3.      The Sale Holder shall pay the amount derived by deducting the sales commission stipulated in Article 27 (2) of these conditions from the purchase price to Seller.

                  4.      For horses sold in the Foal Selection Sale and Foal Autumn Sale, in addition to the sales commission set forth in the previous paragraph, the sales insurance premium stipulated in Article 27 (4) of these Conditions of Sale shall also be deducted from the amount to be paid by the Sale Holder to Seller.

                  5.      After a transaction is concluded for a yearling or 2-year-old horse, the Sale Holder shall deliver to the successful bidder of the horse the Certificate of Foal Registration submitted by Seller upon payment of the full purchase price. However, in cases where the Certificate of Foal Registration has not yet arrived as described in Article 12 Paragraph 2 (1) (a) and (2) (c), the Sale Holder shall deliver the Certificate of Foal Registration to the successful bidder after said certificate has been submitted to the Sale Holder by Seller.

                     6.   Closing time of the sale session refers to the time the sale closes on the relevant day of the relevant sale. Close of the Sale refers to the time when all dates of the relevant sale are completed.

 

(Delivery of Horse)

Article 19  1.      Delivery of a horse for which a purchase transaction has been concluded shall be performed at a place designated by the Sale Holder after payment of the full purchase price.

                     2.   In the event procedures set forth in Articles 20 and 21 of the Conditions of Sale are initiated in connection with a horse for which a purchase transaction has been concluded, the horse may not be moved without the approval of the Sale Holder, regardless of whether full payment for the horse has been made.

                  3.      The delivery described in paragraph 1 of this article shall be conducted within the following time periods after conclusion of the purchase transaction: for the Foal Selection Sale and Foal Autumn Sale, delivery shall take place by the end of March of the following year; for the Training Sale, delivery shall take place within 7 days from the day following the close of the Sale; for all other sales, delivery shall take place within 15 days from the day following the close of the Sale.

                  4.      Seller is responsible for keeping the horse under proper conditions free of charge until the time of delivery.

 

(Rescission of Purchase Transaction)

Article 20  1.      If either the successful bidder or Seller breaches these Conditions of Sales in connection with any purchase transaction, the purchase transaction may be rescinded through the Sale Holder.

                  2.      In the event any inaccuracies are discovered in the information submitted under Article 12 Paragraph 2 (1) and (2) (c) after the conclusion of a transaction, the successful bidder or Seller may rescind the purchase transaction through the Sale Holder.

                  3.      If a horsefs pedigree as submitted by Seller is contradicted by blood-typing pursuant to Article 12 Paragraph 2 (1) (a), the successful bidder or Seller may rescind the purchase transaction through the Sale Holder.

                  4.      If the successful bidder discovers in relation to the horse for which the successful bid was made any conditions listed in Paragraph 5 of this article which were not declared on the day of the sale, the successful bidder may submit a written claim to that effect, along with the relevant documents or veterinary certificate, to the Sale Holder in the period after the conclusion of the relevant purchase transaction and within 3 days from the day following the close of the Sale. However, this shall not be the case if the successful bidder has taken delivery of said horse from Seller.

                  5.      The conditions referred to in Paragraph 4 of this article are as follows:

                                 (1)           Bad habits (Cribbing, Box-Walking, Weaving, Self-Biting)

                           (2)  Eye abnormalities (Cataracts, Amaurosis, Glaucoma), Periodic Ophthalmia (Moonblindness)

                           (3)  History of joint surgery

                           (4)  History of abdominal surgery

                           (5)  Castration

                           (6)  Missing or damaged teeth

                           (7)  History of surgery under general anesthesia

                           (8)  For the Training Sale, roaring from laryngeal hemiplegia

                  6.      In the event a claim is submitted by the successful bidder pursuant to Paragraph 4 of this article, the Sale Holder shall promptly so inform Seller and shall arrange thorough its own efforts or that of its approved veterinarian to have the claim of the successful bidder investigated and shall promptly notify the successful bidder of the results of such investigation.

                  7.      If the results of the investigation pursuant to Paragraph 6 of this article agree with the contents of the claim, the successful bidder may rescind the purchase transaction through the Sale Holder.

                  8.      The successful bidder may not transfer title to the relevant horse to any third party until the Sale Holder determines the results of the investigation.

 

(Request for Rescission of Purchase Transaction)

Article 21  1.      If the successful bidder discovers in relation to the horse for which the successful bid was made any conditions listed in Paragraph 2 of this article, the successful bidder may submit a written claim to that effect, along with the relevant veterinary certificate and X-ray pictures, to the Sale Holder in the period after the conclusion of the relevant purchase transaction and within 3 days from the day following the close of the Sale. However, this shall not be the case if the successful bidder has taken delivery of said horse from Seller.

                  2.      The conditions referred to in Paragraph 1 of this article are as follows:

                                 (1)           Osteo-Chondrosis Dissecans of the hock joint

                           (2)  Subchondral bone cyst of scapula or femur

                           (3)  Fractures of the joint

                           (4)  Wobbler symptoms from stricture of the vertebrae

                  3.      If the successful bidder makes a request to rescind the purchase transaction, the Sale Holder shall so notify Seller. Seller shall arrange for the relevant claim to be investigated and submit the relevant veterinary certificates and x-ray pictures and any other necessary documents to the Sale Holder within 3 days from the day following receipt of the notification from the Sale Holder.

                  4.      The Sale Holder shall submit the veterinary certificates and x-ray pictures and any other documents submitted by the successful bidder and Seller to the Hokkaido Sales Judgment Committee (hereinafter the gJudgment Committeeh) set forth in Article 22 of these Conditions of Sale, which shall be the committee entrusted to decide on the matter.

                  5.      The decision of the Judgment Committee will be considered the decision of the Sale Holder, and the successful bidder and Seller shall be so notified.

                  6.      If the claim of the successful bidder is recognized after deliberation by the Judgment Committee, the successful bidder may rescind the purchase transaction through the Sale Holder.

                  7.      The successful bidder and Seller shall comply with the decision of the Judgment Committee as notified pursuant to Particle 5 of this article.

                     8.   Buyer may not transfer title to the relevant horse to any third party until the Sale Holder reaches its final decision, regardless of whether full payment for the Horse has been made.

                     9.   If the claim of the successful bidder is not recognized, the costs incurred by the Seller in making the necessary reports to the Sale Holder shall be borne by the successful bidder.

 

(Judgment Committee)

Article 22  1.      The Hokkaido Sales Judgment Committee shall include veterinarians approved by the Sale Holder.

                  2.      The Judgment Committee shall deliberate and decide matters relating to any claims submitted pursuant to Article 21 of these Conditions of Sale.

                  3.      The Judgment Committee may investigate at its sole discretion claims of illness and other maters as deemed necessary.

 

(Post-Transaction Announcements)

Article 23                    To announce the results of concluded transactions, the following information will be posted within the sales premises by the day following each sale day.

                              (1)Number of horses offered by breed, sex and age

                              (2)Number of concluded transaction by breed, sex and age

                              (3)The highest, lowest and average purchase price b‚™ breed, sex and age.

 

Chapter 3 Sales Operation Staff and Transaction Staff

 

(Sales Operation Staff)

Article 24  1.      The operation of the Sale will be conducted by the following staff:

                        (1)Sale Director                       1 person

                        (2)Auctioneer                           1 or more persons

                        (3)Veterinarian                                    1 or more persons

                        (4)Sales Attendant                   1 or more persons

                        (5)Assistant to Auctioneer       1 or more persons

                  2.      The Sale Director shall oversee the work of the auctioneer(s), veterinarian(s), sales attendant(s) and assistant(s) to auctioneer(s).

                  3.      The auctioneer(s) shall conduct the running of the auction.

                  4.      The assistant(s) to auctioneer(s) shall assist the auctioneer in conducting the running of the auction.

                  5.      The staff listed in paragraph 1 of this article must wear an identification badge as specified separately hereof.

 

(Prohibited Acts of Auctioneer)

Article 25                    The auctioneer is prohibited from performing any of the following acts:

                        (1)  Conspiring with any Seller or Buyer in such a manner as to obstruct the legitimate conducting of transactions or allowing any Seller or Buyer to engage in bid rigging or any other wrongful act.

                        (2)  Receiving money or any other form of gain in connection with the auctioneerfs professional duties.

                        (3)  Becoming directly involved as a principal in a purchase or sale.

                        (4)  Intentionally obstructing the establishment of a successful bid.

                        (5)  Calling out bids in argot or any other manner not commonly accepted.

                        (6)  Disclosing the preferred sale price unjustly or to a specific third party.

 

(Prohibition of Commercial Brokerage)

Article 26           Commercial brokerage is prohibited in the sales for which these conditions apply.

 

Chapter 4    Collectible Fees

 

(Collectible Fees)

Article 27           Collectible fees and their amounts are as follows:

                     (2)  Sales Commission

                           Sales Commission charged to Seller shall be 50/1000 of the successful bid plus consumption tax.

                     (4)  Sales Insurance Premium

                           For horses sold in the Foal Selection Sale and Foal Autumn Sale, a sales insurance premium of shall be deducted from the sale price as shown in Table 3 of the Appendix to the Japanese version of the Conditions of Sale. (24/1000 of the purchase price for the Foal Selection Sale and 20/1000 of the purchase price for the Foal Autumn Sale.)

 

Chapter 5    Miscellaneous Provisions

 

(Provisions Concerning Breach of Agreement)

Article 28  1.      In the event the successful bidder fails to pay the amount equal to the purchase price, the successful bidder must pay a fine equal to 50/100 of the purchase price to the Sale Holder.

                  2.      The Sale Holder will pay the collected fine to the Seller of the horse for which the successful bid was made.

 

(Insurance for Foals)

Article 29           For horses sold at the Foal Selection Sale and Foal Autumn Sale, the Sale Holder shall insure the horse for its total purchase price value through the Sales Insurance Scheme at the expense of the seller.

 

(Court of Jurisdiction)

Article 30                    The successful bidder, Seller and Sale Holder agree that the Sapporo District Court will be the court having jurisdiction over any and all disputes arising out of or in connection with the purchase transaction.

 

(Provisions Concerning Maintenance of Order on Sales Premises)

Article 31                    The Sale Holder may remove from or prohibit entry for a designated period of time onto the sales premises any party to which the following apply:

                     (1)  A party that has breached these conditions

                     (2)  A party that has spread false rumors concerning horses on offer for which transactions have not been concluded

                     (3)  A party that has declared false information to the sales office

                     (4)  A party that has obstructed sales operations or disturbed order on the sales premises or is considered liable to do so

               (5)  A party that has intentionally damaged property on the sales premises or caused harm to any horses

               (6)  A party that does not follow the instructions of the sales attendants

            2.      In the event the Sale Holder prohibits entry of a party onto the sales premises according to the previous paragraph, the Sale Holder will post the name of the party, the period for which the party is prohibited entry and the reason for such prohibition within the sales premises.