GENERAL TERMS AND CONDITIONS OF TRADE
ISOLOC Schwingungstechnik (Vibration Technology) GmbH, Stuttgart

§ 1 General

1. These terms and conditions, along with any special contractual agreements that there may be, cover all goods and services. Despite acceptance of the order, any differing purchase conditions of the customer do not form an intrinsic part of the contract. A contract is deemed to exist – in the absence of any specific agreement – on receipt of the written confirmation of order from the supplier.

2. The supplier retains ownership and copyright of patterns, costings, estimates, diagrams and similar information of both physical and non-physical nature – including in electronic form. Access to such information is to be denied to third parties. The supplier undertakes only to allow access by third parties to information and documentation classified as confidential by the customer with the permission of the latter.

§ 2 Price and Payment

1. In the absence of any other date being given, requests for payment made by us are payable immediately from the date of the relevant invoice. Discounts are only permissible, if specified in the confirmation of order and/or invoice.

2. If payment is not made by the due date, we may apply interest from the date of default at a rate of 3% above the discount rate of the German Federal Bank (Deutsche Bundesbank) plus VAT at the prevailing rate on such interest. We retain the right to impose a higher rate of interest for payment arrears.

3. Bills of exchange and cheques, including those of the customers of our purchasers, are accepted only in payment. The associated liabilities will only be considered to be settled by the debtor’s security once the amount of the bill of exchange or cheque has been cleared. This also applies in the case of so-called bill of exchange/cheque payment method by the debtor, where we have accepted the drawer’s liability as a “simple” contingent liability. All costs relating to bills of exchange and cheques rest with the payer.

4. In the case where payments are not settled by the due date, all other demands become due, irrespective of any concessions or the validity period of bills of exchange received. We are also entitled in this case to require guarantees and/or only to expedite outstanding deliveries against pre-payment or the provision of securities. Where payment dates are exceeded we may forbid the onward disposal, modification, processing or installation of goods supplied that are under ownership restriction and to request their immediate return or the transfer of indirect possession at the expense of the customer or purchaser, without the requirement to withdraw from the contract.

5. The customer only has the right to withhold payments or to make counter-claims where such counter-claims are not contested or are established in law.

§ 3 Transfer of Risk, Approval

1. Risk is transferred to the customer, when the item to be delivered has left the works, even if delivery is in parts or the supplier has taken responsibility for other services, e.g. dispatch costs or the delivery and assembly. Where approval must take place, this provides the authority for the transfer of risk and must be undertaken without delay in accordance with the approval schedule, with the assistance of a report from the supplier of readiness for approval. The existence of a minor deficiency is not grounds for the customer to refuse approval.

2. If the dispatch and approval is delayed or does not take place as a result of circumstances not attributable to the supplier, transfer of risk to the customer occurs from the day that dispatch and readiness for approval is notified. The supplier undertakes to put in place any insurance cover required by the customer at the expense of the latter.

3. Partial deliveries are admissible, where they are reasonable for the customer.

§ 4 Retention of Ownership

1. The supplier retains ownership of all items supplied until the customer has paid all present claims of the contract for delivery.

2. Where actions by the customer are in breach of the contract, particularly delay in payment, the supplier is entitled to claim the return of the items supplied. The customer agrees to a return in this case already now. The return is only a withdrawal from the contract if the supplier declares this expressly. The costs arising from the return (particularly transport costs) to the supplier are at the expense of the customer. Furthermore the supplier is entitled to prohibit to the customer any onward disposal or processing of the items supplied under retention of ownership or to cancel the direct debit authorisation (fig. 5).

3. The customer is obliged to treat carefully the items supplied; he is particularly obliged to insure them sufficiently against elemental forces and theft on his own cost to the replacement value. Claims resulting hereby to the insurance are ceded to the supplier already now.

4. The items to be delivered and the claims replacing them may neither be pledged or used as a security nor transferred by the customer. Appropriations or other declarations of third parties must be notified in written form by the customer to the supplier without delay so that the supplier can file suit according to § 771 ZPO. The remaining costs of this suit for the supplier in spite of a victory in the legal dispute as per § 771 ZPO have to be paid by the customer.

5. The customer is entitled to onward disposal, processing or installation of the items supplied in the ordinary course of business. However, the customer cedes all claims from the onward disposal, processing, installation or other legal grounds (particularly from the security or unauthorised actions) amounting to the final invoice amount incl. VAT agreed with the supplier. The customer has the right to collect the claims also after having ceded them whereas the authority of the supplier to collect the claim himself is not touched. The supplier, however, commits to not collecting the claim as long as the customer contracts its debts from the received revenues, is not in delay of payment and no application of opening insolvency proceedings is filed or payments are stopped. But if this is the case the customer has to let the supplier know on request the ceded claims and the debtor, to give all information required for the collection, to hand out appropriate documents and to inform the debtor (third party) of the cession. The direct debit authorisation can be cancelled from the supplier in the case of breach of the contract (especially delayed payment) by the customer.

6. The retention of ownership includes also products generated by processing, mixture or combination with the items delivered by the supplier with their full value whereupon these operations are carried out for the supplier so that the supplier is considered as manufacturer. If because of processing, mixture or combination with parts of third parties their right of ownership persists, the supplier acquires joint ownership in proportion to the objective values of these parts.

7. The customer cedes to the supplier also the claims for the security of the claims of the supplier to the customer that arise to a third party by the combination of the delivered parts with a piece of real estate. 8. The securities which the supplier is entitled to are not registered if the value of the securities of the supplier exceeds by 10 % the nominal value of the claims to be secured. The choice of the securities to be released is incumbent upon the supplier.

§ 5 Deficiency Claims The supplier guarantees against material and legal deficiencies, with the exclusion of further claims – subject to section VII – as follows:

Material Deficiencies

1. Replacement of deficiencies or their repair, as chosen by the supplier, will be made free of charge, of all those parts identified as defective as a result of circumstances prevailing before the transfer of risk. The identification of such deficiencies is to be reported to the supplier in writing immediately. Replaced parts become the property of the supplier.

2. In order for the supplier to plan any repairs and the supply of replacement parts that may be necessary, the customer must, in agreement with the supplier, make available the time and facilities required. Otherwise, the supplier is absolved of any liability for consequences that may arise therefrom. Only in pressing cases where operational safety is jeopardised and to prevent unusually severe damage, which must be notified to the supplier immediately, does the customer have the right to rectify the deficiency himself, or have it rectified by a third party, and to claim reimbursement of the expenditure necessary from the supplier.

3. Costs arising from repair and delivery of replacements – where the complaint is valid - will be born by the supplier. This includes the cost of parts and dispatch. 4. Within the framework of legal provisions, the customer has the right of withdrawal from the contract if the supplier – with due regard to legal exceptions - allows the set reasonable period of time for the repair or replacement of defective parts to elapse, without achieving such repair or replacement. If only one insignificant deficiency remains, the customer simply has the right to a reduction in the contract price. Otherwise a reduction in the contract price is excluded. Other admissible claims are set out in § 6, fig. 2 of these Terms and Conditions.

5. The guarantee is invalid under the following circumstances in particular: Unsuitable or improper use, faulty installation and operation by the customer or a third party, fair wear and tear, incorrect or negligent operation, servicing not in accordance with the schedule, unsuitable power supply, defective buildings, unsuitable site, chemical, electro-chemical or electrical effects – where these are not attributable to the supplier.

6. If the customer or a third party carries out inappropriate repairs, the supplier is not liable for any consequences that may arise. The same applies to modifications to the items supplied not previously cleared with the supplier.

Legal Deficiencies

7. If use of the items supplied causes the violation of domestic industrial property rights or national copyright, the supplier, at his own expense, will procure for the customer the right to continue to use the items supplied or modify them in such a way as to eliminate the violation of the industrial property rights. If this is not reasonably commercially possible or cannot be achieved within a reasonable period of time, the customer has the right of withdrawal from the contract. Under the above circumstances the supplier also has the right of withdrawal from the contract. In addition the supplier will indemnify the customer against uncontested or legally established claims by the affected owners of industrial property rights.

8. The obligations of the supplier set out in § 5, fig. 7 are subject to § 6, fig. 2 and limited to the violation of industrial property rights or copy right. They apply only if:

• The customer informs the supplier immediately of any valid industrial property rights or copyright,

• The customer offers the supplier reasonable support in the prevention of valid claims and enables the supplier to carry out the modification measures in accordance with § 5, fig. 7,

• All remedies, including out of court rulings remain available to the supplier,

• The legal deficiency does not involve an instruction from the customer, and

• The violation of rights did not arise from the alteration of the items supplied, or their use by him not in accordance with the contract.

§ 6 Liability

1. If the items supplied cannot be used by the customer in accordance with the contract as a result of a fault on the part of the supplier arising from absent or erroneous provision of guidance and advice, both before and after conclusion of the contract, or as a result of the violation of other contractual obligations – particularly instructions for use and maintenance of the items supplied – then, further claims by the customer excepted, the provisions of § 5 and § 6, fig. 2 apply as appropriate.

2. For damages, not occurring directly to the items supplied, on whatever legal grounds, the supplier is only liable

a. for intent,

b. for gross neglect on the part of the owner / of the agents or of senior staff,

c. for culpable injury to life, limb or health,

d. for deficiencies that are maliciously obscured or which were guaranteed to be absent,

e. for deficiencies in the items supplied, according to the Product Liability Act for personal or material damages for privately used items.

In the case of culpable violation of significant contractual obligations, the supplier is liable for the gross negligence of junior staff and for minor negligence, in the latter case limited to the normal and foreseeable damage as envisaged by the contract. Further claims are excluded.

§ 7 Time Limitations

All claims by the customer – on whatever legal basis – have a 12 month time limitation. For damage claims in accordance with § 6 fig. 2 a – e, the legal time periods apply. They are also valid for assembly deficiencies or for items supplied, used appropriately for the structure in question and have caused the latter to be defective.

§ 8 Information / Samples

1. Information obtained from us on deliveries or other services does not imply any obligation, even if it is in writing. In the absence of any other source of written communication such information is no assurance of characteristics.

2. Samples and patterns provide an approximate indication of quality, dimensions and colour.

§ 9 Software Use

Where software is contained in the deliverables, the customer is granted a non-exclusive right to use the software supplied along with its documentation. It is provided for use with the agreed items supplied. Use of the software on more than one system is prohibited. The customer may only reproduce, develop, translate the software or convert its object code into source code as legally permitted (§§ 69 a ff. UrhG [Copyright Law]). The customer undertakes not to remove the producer’s details, in particular copyright markings, or make other alterations without the specific, prior agreement of the supplier. All other rights to the software and its documentation including copying remain with the supplier and the software supplier. The issuing of sub-licences is not permitted.

§ 10 Applicable Legislation, Place of Jurisdiction

1. German Federal Law as it relates to dealings between parties nationally applies exclusively and authoritatively to all aspects of the legal relationship between the supplier and the customer.

2. The place of jurisdiction is that of the normal court of the head office of the supplier. The supplier has the right to file claims at the head office of the customer.

§ 11 Ineffectiveness of a Condition

Should any of these terms and conditions be ineffective or declared invalid as a result of a court judgement, the remaining terms and conditions are unaffected and shall continue to be effective.

This is a translation. The only legally binding conditions are exclusively the German language version.