General payment and delivery termes and conditions

A: GENERAL PROVISIONS

I. CONCLUSION OF CONTRACTS

1. All our present and future deliveries and services

will be effected and performed on the basis of the following conditions. The buyer's conditions of purchase

will not be binding on us, even should we fail explicitly

to reject them after notice of them has been given to us.

These conditions of delivery and payment shall be deemed to be accepted, at the latest, when goods dispatched by us are received.

2. Our offers are not binding. All conclusions between the contracting parties must be effected in writing. Contract conclusions become only valid with our written order confirmation. This also applies to any subsequent changes.

3. These conditions are also applied to sales contracts concluded on the basis of trade terms, especially of the Incoterms.

When sales are based on any of the trade terms specified in the Incoterms, only the Incoterms latest edition can be applied. The trade terms are, however, only applied insofar as the present conditions or any other special agreement are not in contradiction with them.

II. PRICES, CONDITIONS OF PAYMENT

1. Our prices are mentioned in the order confirmation. Should the prices of our suppliers, our costs (such as increased freight costs) or our duties be increased, or new duties be introduced between the conclusion of the contract and the deliveries and services, we are entitled to review the prices, unless otherwise agreed. The same applies to fiscal or other duties, freight and customs rates, etc., of which we were not informed when concluding the contract.

2. Our prices are based on normal, unrestricted transport conditions. Extra costs arising from transport problems or dead freight charges shall be borne by the buyer.

3. If the customs duties, consular fees, freight charges, insurance premiums and other secondary costs included in the agreed price should increase after the contract has been signed or if new costs arise, such additional costs shall be borne by the buyer. This shall also apply to extra costs arising in case the delivery will be different to the scheduled one (e. g. rail instead of inland waterway or delivery via another port).

4. The extra costs mentioned in 2. and 3. will not have to be borne by the buyer if we are responsible for them.

5. The buyer is not entitled to offset possible claims against us, nor to retain his payments on account of such claims.

6. Credits in respect of bills of exchange and checks will be entered into our books, subject to their final acceptance, less commission, at their value at the day when being credited by the bankers.

7. In the event of any delay in payment, we will charge interest and commission, as from due date, at the current bank rates for overdrafts, but not less than five per cent above the current rate of the Central European Bank.

8. Irrespective of the period of validity of any bills of exchange accepted and confirmed, all our claims shall be due forthwith if the conditions of payment are not adhered to or if we learn of circumstances which, in our opinion, vitiate the credit-worthiness of the buyer. We shall then also be entitled to effect any outstanding deliveries only against payment in advance and, after an appropriate period, to withdraw from the contract or to claim damages for breach of contract. We shall, moreover, be entitled to ban the re-sale and ask for the return or the transfer of actual possession of the goods delivered at the expense of the buyer and revoke the authorization to collect, in compliance with A III 3. In such cases we shall be entitled to remove the goods delivered from the buyer's warehouse. The buyer shall furthermore bear all expenses, which may occur (legal fees, traveling expenses etc.) as he has failed to fulfill his contractual commitments.

9. We shall be entitled to securities of the customary nature and extent for our claims, even though these may be conditional and applicable for a limited period of time.

10. Should any difficulty arise, for whatever reason, when the invoiced amount is transferred to the agreed place of payment, any consequential loss and costs shall be borne by the buyer. If the buyer's payment in foreign currency is not duly effected at due date, he has to refund any loss thereby incurred (e.g. exchange loss) and to compensate us to the full extent.

III RESERVATION OF OWNERSHIP

1. All goods delivered remain our property (reserved goods) until final settlement of all claims, especially such in respect of outstanding balances due to us, for whatever legal reason.

2. The claims of the buyer arising out of re-sales of the reserved goods are hereby assigned to us. They will be used as a security to the same extent as the reserved goods.

3. The buyer shall be entitled to collect amounts due in respect of re-sales until we cancel this right, as we shall be entitled to do at any time. We shall only make use of this option in the cases listed in A II 8. On no account is he entitled to cede claims. At our request, he shall inform his customers immediately of the transfer of ownership to us - unless we will do it ourselves - and furnish us with the information and documents required for the collection.

4. If the reservation of ownership or the transfer of ownership is not operative under the law applying where the goods are located, a security equivalent to the reservation or transfer of ownership shall be deemed agreed upon. If the cooperation of the buyer is necessary here, he shall take any measures necessary for the establishment or maintenance of such rights.

IV. INADMISSABLE RE-SALE

1. Goods sold for export may not be left in the manufacturers country nor may the goods be re-imported nor may they be delivered to any other country than the one mentioned in the order.

2. Should we request, the buyer shall provide evidence as to the whereabouts of the goods.

3. The buyer shall bind his customers to the obligations of A IV 1 & 2 and, upon request, provide us with corresponding evidence. He shall inform us at once of any violation, on the part of his customers, of the obligations he has entered into, in accordance with 1. He shall also assign damages for breach of contract and contractual penalties to us.

4. If there is any violation, by the buyer or his customers, of the obligations mentioned above, the buyer shall compensate us for loss of profit and pay a fine for breach of contract equal to thirty per cent of the contract price.

B: EXECUTION OF DELIVERY

I. DELIVERY TIME, DELIVERY DATES

1. The delivery time and delivery dates are always only approximate. We are entitled to effect partial deliveries, unless otherwise expressly agreed upon.

2. The delivery time shall start as from the date of our confirmation of the order but not before all details of the order have been clarified (among others workable letter of credit opened) and any necessary domestic or foreign official documents submitted. Delivery time and delivery dates refer to the time of dispatch from supplier's facilities. The delivery time and dates shall be deemed to have been met upon our notification of readiness for dispatch, if the goods cannot be forwarded at the due date, through no fault of ours nor our sub-suppliers.

The delivery time shall be extended - without prejudice to our rights resulting from any default on the part of the buyer - by a period lasting as long as the buyer is in default in respect of his obligations under this contract or of his liability to pay us under other contracts. This shall also apply to delivery dates.

3. In case we should be in default of delivery, the buyer may, after having set an appropriate period of time, withdraw from the contract, unless the goods have been notified as ready for dispatch before this period has elapsed.

II. FORCE MAJEURE AND OTHER EVENTS PRECLUDING DELIVERY

1. Force majeure shall entitle us to defer delivery for as long as it is operative, plus an appropriate further period needed to recommence production, or to cancel, wholly or partly, any part of the contract which has not yet been completely fulfilled.

2. Events of force majeure are, for instance, mobilization, acts of war, monetary or trade policy measures, as well as official measures that preclude the fulfillment of the contract.

Equal to events of force majeure are interruption, strikes, lock-outs, or similar circumstances which make it eminently difficult or impossible for us to deliver, such as fire, breakdown of machines, shortage of raw materials or fuels, as well as transport difficulties, and this regardless of whether these circumstances affect us, or one of our subcontractors.

3. The buyer may ask us to indicate whether we are canceling or wish to deliver within an appropriate period. Should we fail to give such an indication, the buyer may cancel the contract. We are not bound to place the order with another producer after the event, nor to forward the goods by another route than the one scheduled by us.

III. INSPECTION

1. If an inspection has been agreed, it can only be effected in the manufacturer's facilities immediately after the goods have been notified as ready for dispatch. The costs of inspection shall be borne by the buyer.

2. If inspection is not effected in due course, not completely or not at all, we are entitled to dispatch the goods without inspection or to put them in store at the risk and expense of the buyer. As soon as dispatched or put in store, the goods are considered as delivered according to the terms of the contract.

IV. DISPATCH

1. Goods notified as ready for dispatch must be called immediately, otherwise we are entitled to proceed as specified under point 2.

2. If there is any delay, which is beyond our responsibility, in shipping or forwarding the goods, we or our agents are entitled, although not obliged, to place the goods in storage at the risk and expense of the buyer, and without assuming any responsibility, to take any measures we consider suitable for the preservation of the goods, and to invoice them as delivered.

3. If, through no fault of ours, it is impossible to forward the goods by the agreed route or to the agreed place in the scheduled time, we are entitled to deliver them by another route or to another place; the costs thereby incurred are to be borne by the buyer. Before making any decision the buyer will be given the opportunity to state his instructions.

4. We shall take care, according to our own experience, of the export packing, protection and other means in view of the transport, without assuming any responsibility. Packing, protection and other means used for the transport are not required to be returned.

5. If the mailing of dispatch notes and other documents, of which we have to take care after dispatch, is delayed, we shall only be held responsible in case of gross negligence.

6. In the event of damage in transit, the buyer has to call immediately on the competent authorities inviting them to draw up a statement of the facts.

7. In case of CIF/CIP delivery terms and in case of loss or damage, obviously or concealed, the buyer is requested to contact upon receipt of goods immediately, latest within 10 days the survey agent, mentioned expressly in the insurance certificate.

V. RISKS

The risks shall pass on to the buyer as soon as the goods are placed at the disposal of the forwarding agent or the carrier, at the latest, however, when leaving our factory or our warehouse.

When sales are based on any of the trade terms specified in the Incoterms latest edition, only the latter shall be applied to the passing of risk.

VI. PRODUCT DEFECTS, DELIVERY OF GOODS AT VARIANCE WITH THE CONTRACT

For defects in goods, including failure to comply with agreed specifications, we shall offer the following guarantee:

1. The condition of the goods at the time of dispatch shall be decisive in determining whether their condition is complying with the contractual specification.

2. After agreed inspection of the goods by the buyer, complaints about defects that are not identifiable at the time of the agreed form of inspection shall not be accepted.

3. Complaints about defects must reach us within 10 days from receipt of goods by the buyer and in writing, by fax or by e-mail, but such complaints shall not entitle the buyer to defer payment.

Defects which cannot be detected within this period, even after the most careful examination, must be notified immediately when they come to light.

4. In the case of justified complaints made in due time and expressly accepted in writing by us, we shall provide the buyer with the necessary spare parts and/or instructions to enable repair locally within a reasonable period of time. If not repairable locally, we might instruct the buyer to return the defective goods to our factory for repair or replacement.

5. If the buyer gives us or our sub-supplier no opportunity to check the existence of the defects and particularly if he does not put the goods in question at our disposal for examination all his claims will be disregarded.

C: MISCELLANEOUS

I. CONTINUOUS DELIVERIES

In the case of contracts providing continuous deliveries, calls are to be specified when placing the order. If calls are not given to us in time, we are entitled to determine ourselves and to deliver the goods, or to withdraw from the outstanding part of the contract and to claim damages.

II. PARTIAL DELIVERIES

We shall be entitled to make partial deliveries after giving the buyer an opportunity to state his instructions. The additional costs to us will not have to be borne by the buyer if we are responsible for them. The price will remain unchanged. Every partial delivery will count as a separate transaction.

III. EXPORT DECLARATION

When collecting goods which are not destined for the German market the buyer or his delegate has to submit us the export declaration required by the fiscal authorities. Otherwise he has to pay value added tax (VAT) actually

IV. APPLICABLE LAW, PLACE OF JURISDICTION

All legal relations between the buyer and ourselves shall be governed exclusively by the German law. The regulations of the "United Nations Convention on Contracts for the International Sale of Goods" are expressly excluded.

The place of jurisdiction for both contracting partners shall be the company's place of business. We are also entitled to take the buyer to court in another admissible place of jurisdiction at our choice.

V. PARTIAL INVALIDITY

Should any individual provision in these conditions of delivery and payment be or become partly or wholly invalid the remaining conditions will still be fully valid.