TERMS OF SALE AND DELIVERY
DIRKS GMBH & CO. KG

1.   APPLICATION OF THE TERMS AND CONDITIONS

Offers, shipments and performance on the part of the Seller shall be exclusively subject to these terms and conditions. These terms and conditions shall also apply to all future business relationships, even if they have not been explicitly agreed upon once more.
Any counter-acknowledgements as well as terms and conditions of purchase of the Buyer making reference to the terms and conditions formulated by the latter are hereby expressly contradicted. Any terms and conditions deviating from these terms and conditions shall only be effective if they have been confirmed in writing on the part of the Seller.

2.   OFFERS AND CONCLUSION OF CONTRACTS

Offers submitted by the Seller are subject to change and without obligation. Declarations concerning the acceptance of goods and orders shall be subject to the written confirmation of the Seller in order to be legally effective. The same shall apply to any supplements, amendments or collateral agreements. Drawings, illustrations, dimensions, weights or any other performance data shall only be binding if these have been explicitly agreed upon. Any agreements made verbally or on the telephone shall require the written confirmation of the Seller for their validity.

3.   PRICES

The prices indicated in the order confirmation plus statutory value-added tax shall be decisive. All deliveries will be effected ex works, charges for packaging shall be made according to expenditure on a case-to-case basis. Should there be a period of more than 4 months between the conclusion of the contract and the stipulated and/or actual date of delivery, the prices of the Seller valid at the time of delivery or when the goods were made available shall apply.

4.   TERMS OF PAYMENT

Invoices rendered by the Seller are payable within 14 days with a cash discount of 2 %, and 30 days net, from the respective date of invoice. Invoices for months, repairs, moulds and tools are due for payment immediately and in the net amount. Counter-claims contested by the Seller or which have not yet been declared final and absolute do not entitle the Buyer to a retention of the goods or set-off. If the credit period has expired, at the latest after a reminder has been sent, the Seller is entitled to charge interest in the amount of the bank rates currently in force for overdraft facilities. Should the Seller subsequently become aware of any circumstances from which a fundamental deterioration of the financial position of the Buyer ensues, which pose a threat to the claim for payment on the part of the Seller, or if the Buyer gets into arrears with his payments, the Seller shall be entitled to take back the goods after granting a reasonable extension of the original term. Moreover, the Seller may prohibit the further processing and sale of the delivered goods. Taking back the goods does not constitute a rescission of contract.

5.   DELIVERY AND PERFORMANCE PERIOD

Delivery periods shall commence after receipt of all of the documents required for the execution of the order, of the stipulated down-payment, the timely provision of materials as well as the release of the prototype by the Buyer. Unless otherwise explicitly agreed upon in writing, dates and deadlines stipulated by the Seller shall, as a matter of principle, be without obligation. In the case of delays in delivery and performance due to force majeure and on account of events or incidents which considerably hinder the Seller with regard to delivery or make such delivery impossible – this also includes subsequent difficulties in the procurement of materials, breakdowns, strike, lock-outs, lack of staff, lack of transport means, directives issued by authorities, etc., even if they are incurred by suppliers of the Seller or sub-contractors – the Seller shall not be held responsible even if the deadlines and dates were agreed upon with a binding nature. They entitle the Seller to extend the delivery or performance by the duration of the impairment with the addition of a reasonable start-up period or to fully or partially rescind the contract due to the part which has not yet been fulfilled.

6.   PACKAGING, SHIPMENT, PASSING OF RISK

If the impairment lasts longer than 3 months, the Buyer shall, after granting a reasonable extension of the original term, be entitled to rescind the contract in view of the part which has not yet been fulfilled. Claims for compensation due to non-performance or delay in delivery are excluded. The Seller is entitled to effect partial deliveries or services at any time. The Seller reserves the right to effect short shipments or additional deliveries of the ordered quantity up to 10 %, also in the case of part-shipments. The Buyer explicitly accepts such deviations in quantity.
Deliveries will be effected for the account and at the risk of the Buyer, even in the case of deliveries carriage paid. The routing and means of transport shall be at the option of the Seller with the exclusion of any liability. The Seller is not obligated to send any shipments to an address different from that of the Buyer, e.g. to sub-customers. Should this, however, be done by way of exception at the request of the Buyer, all additional costs arising as a result of further distances, special manners of delivery or other expenditure shall be at the expense of the Buyer. The risk shall pass to the Buyer as soon as the shipment has been handed over to the person carrying out the transport or has left the warehouse of the Seller for the purpose of shipment. This shall also apply in the case of delivery carriage paid. Should the dispatch of the goods be delayed or impossible without the Seller being at fault, the risk shall pass to the Buyer when notification is given that the goods are ready for dispatch. If requested by the Buyer in writing, the goods will be insured against storage, breakage, transport and fire damage at his expense.

7.   RESERVATION OF OWNERSHIP

Until all claims have been satisfied (including all current account balance claims), to which the Seller is entitled now or in the future vis-à-vis the buyer on any legal grounds, the Seller shall be granted the following securities which he will release on request at his own discretion insofar as the value exceeds the claims by more than 20 % in a sustained manner. The goods shall remain the property of the Seller, processing or transformation costs are also carried out for him as the manufacturer, but without any obligation for him. If the (co-) ownership of the Seller lapses by means of association, it is already agreed that the (co-) ownership of the Buyer of the new property shall pass to the Seller in proportion to the value of the supplied item (invoiced value). The Buyer shall keep the joint property of the Seller in safe custody free of charge. Goods in the case of which the Seller is entitled to (co-) ownership are hereby referred to as goods subject to reservation of ownership. The Buyer is entitled to process and to sell the goods subject to reservation of ownership within the course of normal business insofar as he is not in arrears, pledging or transfer of ownership by way of security are inadmissible. Any accounts receivable and other claims arising from the further sale

or due to any other legal grounds (loss/destruction, tortious acts, insurance) concerning the goods subject to reservation of ownership vis-à-vis the Buyer’s customers with all secondary rights (including all current account balance claims) shall, by way of precaution, already be assigned to the Seller to the full extent. The latter shall revocably authorise the Buyer to collect the claims assigned to the Seller on his own account and in his own name. The authorisation concerning collection can only be revoked if the Buyer fails to meet his financial obligations in a due and proper manner. In the event of a seizure of the goods subject to reservation of ownership by third parties, the Buyer shall draw their attention to the ownership of the supplier and notify him without delay. Any intervention costs incurred by the Seller shall be assumed by the Buyer. Should the Buyer act in breach of contract – in particular a delay in payment – the Seller is entitled to take back the goods subject to reservation of ownership or, if applicable, to demand the assignment of the claims of the Buyer for restitution of property vis-à-vis third parties. Should the supplier take back or pledge the goods subject to reservation of ownership, this does not – insofar as the German Consumer Credit Act is not applied – constitute a rescission of the contract. If the Seller makes use of his reservation of ownership by taking back goods subject to reservation of ownership pursuant to the provisions above, he is entitled to sell the goods in the open market or to have them auctioned. The goods subject to reservation of ownership are repurchased to the value of the proceeds achieved, but at the maximum amount of the delivery prices agreed upon. The Seller reserves the right to assert additional claims for damages, in particular loss of profits.

8.   WARRANTY

If the Seller has advised the Buyer, the former shall only be liable for the functionality and suitability of the purchased part if he has explicitly provided his assurance in writing. Notifications of defects are to be asserted in writing vis-à-vis the Seller (not vis-à-vis a representative) without delay, at the latest 1 week after receipt of the shipment. The receipt of a notification of a defect by the Seller shall be decisive for the timeliness of said notification and not the date when it was sent. The faulty objects delivered are to be held ready for inspection by the Seller in the condition in which they are at the time when the defect is established. An infringement of the aforesaid obligations shall result in the exclusion of any warranty claims. Any reworking of the parts without proper authority or rough handling thereof shall also result in the loss of all warranty claims. The Buyer shall only be entitled to remedy defects after prior notification of the Seller and to demand the reimbursement of the reasonable costs for such work in order to avert disproportionately high losses or in the event of a delay on the part of the Seller in remedying the defect. In the event of a notification of defects being justified – whereby the patterns provided by the Buyer shall be decisive for quality and workmanship – the Seller shall be obligated to choose to rework or replace the goods free of charge after the rejected goods have been returned. Should he fail to meet this obligation within a reasonable period of time, the Buyer shall be entitled to demand a price reduction, remuneration or rescission of the contract. Claims for compensation due to the impossibility of performance, due to non-performance, for breach of an obligation other than by delay or impossibility, for negligence when the contract was concluded and for tortious acts as well as consequential damage arising from defects are – insofar as legally admissible – excluded vis-à-vis the Seller as well as his vicarious agents. This shall not apply to claims for compensation from warranted quality intended to safeguard the Buyer against the risk of consequential damage arising from defects. Patterns and samples are regarded as non-binding samples for approval.

9.   Moulds

The price for the moulds does not include the costs for inspection, neither does it include the costs for testing and machining equipment as well as modifications requested by the Buyer. Moulds, stamping or milling tools, sieves, slides as well as other jigs produced by the Seller or by a third party commissioned by the latter shall become the property of the Buyer when the purchase price has been paid in full. The surrender of the moulds to the Buyer is replaced by the obligation of the Seller to keep them. The Seller is entitled to the exclusive ownership of the moulds until the Buyer has purchased a minimum quantity to be agreed upon and/or until the end of 2 years after the last part-shipment regardless of the statutory claim for ownership of the Buyer and of the life cycle of the moulds. The liability of the Seller regarding the preservation of the articles and care thereof shall be limited to the care as applied in his own affairs. The duties of the Seller shall lapse if the Buyer does not collect the moulds after execution of the order and after being requested to do so in an appropriate manner. If the Buyer has not fully met his contractual obligations, the Seller shall, in all cases, be entitled to a reservation of ownership with regard to the moulds.

10.   PROPRIETARY RIGHTS

The Buyer shall be liable vis-à-vis the Seller for the commissioned shipments and services being free of proprietary rights of third parties, the Buyer shall release the Seller from all relevant claims and shall reimburse him for any losses arising as a result thereof. Draft and construction proposals of the Seller may only be passed on to third parties with his consent.

11.   PROVISION OF MATERIALS

If materials are supplied by the Buyer, they are to be delivered at his expense and risk with a reasonable additional quantity in a timely manner and of a perfect quality. Should these requirements not be met, the delivery period shall be prolonged by an appropriate amount of time. Furthermore, if the Buyer fails to supply the equipment in a timely manner and in a sufficient quality/quantity, the Buyer is obligated to reimburse any additional costs arising as a result thereof. In such cases, the Seller reserves the right to interrupt production and not to resume production until a later time.

12.   APPLICABLE LAW, PLACE OF JURISDICTION, SEVERABILITY

These terms and conditions as well as the entire legal relations between the Seller and the Buyer shall be subject to the laws of the Federal Republic of Germany. The place of jurisdiction for default action is the corporate domicile of the Seller. The same shall apply if the Buyer has no general place of jurisdiction in the country. The place of jurisdiction for all other disputes is at our option, regardless of the amount of the value in dispute, Detmold Regional Court (Landgericht Detmold), Herford District Court (Amtsgericht Herford) or Bielefeld Regional Court (Landgericht Bielefeld) if the Buyer is a fully qualified merchant under the German Commercial Code, a legal entity under public law or a special fund under public law. Should any provision of these terms and conditions or any provision within the scope of other agreements be or become ineffective, the validity of the remaining provisions or agreements shall in no way be affected.