TERMS ANDCONDITIONSFORSUPPLIESANDSERVICES

Art. I. General Information and Applicability of Contract Terms

Unless otherwise agreed in writing, the following General Terms and Conditions for Purchasing apply without exception to the company KOLLER Maschinen- und Anlagenbau GmbH (herinafter “KOLLER”) and to all jobs commissioned by and orders placed by these company. The version of the KOLLER General Terms and Conditions for Purchasing that is valid and most current at the time a contract is concluded becomes a component of that contract, unless otherwise agreed.

No business terms of the contracting party become a component of the contract, even if there is no express objection to such an agreement during and after the conclusion of a contract. Exceptions apply only if and insofar as KOLLER agrees expressly and in writing to incorporate the contracting party´ s business terms.

The acceptance of goods or services by KOLLER without express objection does not in any way imply the incorporation of the contracting party´ s business terms. Conflicting business terms do not affect the establishment of the contract if the parties have agreed on all fundamental points. Here the interpretation will be based on the concurring provisions of both sets of business terms and otherwise on the provisions of the law.

Art. II. Ordering and Contract Conclusion

Only orders issued by KOLLER in writing are legally binding. Orders issued verbally or by telephone are valid only following their written confirmation by KOLLER.

KOLLER never recognizes contract terms on the contracting party´ s order confirmation forms. By accepting our order, the contracting party expressly waives its own terms and recognizes the KOLLER General Terms and Conditions of Purchasing as legally binding. Under no circumstances is it necessary for KOLLER to expressly object to the contracting party´ s general business terms.

Subsidiary agreements that deviate from these terms will be confirmed by KOLLER expressly in writing and apply only to the respective underlying contract.

If the contracting party does not accept our order within ten (10) business days following its receipt, KOLLER is entitled to withdraw the order, and the contracting party can derive no claims from such an order.

Release orders become binding if not objected to by the contracting party within five (5) business days following their receipt.

KOLLER may demand modifications to the delivered goods within the bounds of what is reasonable for the contracting party. The ramifications of such modifications, in particular regarding added or reduced costs and delivery dates, are to be agreed appropriately by common consent.

Art. III. Quotations and Prices

Quotations submitted to KOLLER must be in writing as defined in §§ 126 and 126a of the German Civil Code (BGB). Quotations must be complete (covering all required goods and services) and are to be provided at no charge.

Prices are fixed prices and, unless otherwise agreed, understood to include packaging and be carriage paid to KOLLER or to an expressly agreed destination. Prices must always be indicated including their currency code (usually in EUR). KOLLER never recognizes price increases after a quotation has been submitted.

Art. IV. Delivery Times, Delivery Dates and Late Delivery

The agreed delivery dates and deadlines are binding. The specified calendar week is the week in which the goods must arrive at KOLLER´ s premises or at the expressly agreed destination. Any delivery delays must be reported to KOLLER promptly and in writing, citing the reasons and the anticipated length of the delay.

Partial deliveries are permissible only with our express consent.

In all other cases, the provisions of the law apply.

Art. V. Shipment and Delivery Terms

Unless otherwise agreed in writing, all deliveries must include packaging and be carriage paid to KOLLER or to the expressly agreed destination. Goods may only be delivered during the normal daily business hours of Monday through Thursday from 6:00 a.m. to 3:30 p.m. and on Friday from 6:00 a.m. to 1:00 p.m.. The risk of carriage is always borne by the contracting party. The KOLLER order and subject references must be included in all shipping documents. Each shipment must also include a detailed delivery note with the aforementioned references. The contracting party bears the risk for late delivery if KOLLER is unable to process the delivery on time for lack of aforementioned references.

If delivery ex works is agreed, KOLLER must receive a copy of the freight bill in addition to the delivery note. In such cases, the most affordable shipping option for KOLLER must always be selected. If the contracting party is required to select a more expensive shipping option to prevent delivery delays or as a result of delivery delays, KOLLER will not bear the additional freight cost.

KOLLER declines forwarder and cartage insurance and waives SLVS coverage. KOLLER will assume no insurance costs.

Art. VI. Transfer of Risk

The risk transfers to KOLLER when a delivery that is free from defects is duly surrendered to KOLLER on KOLLER´ s premises or at the expressly agreed destination.

Art. VII. Material Defects and Defects of Title (§§434 and 435 BGB)

The foods provided or services rendered by the contracting party must always be free from material defects and defects of title, irrespective of any assumed warranty. The contracting party is liable for ensuring that the goods or services it provides exhibit the agreed properties at the time of their delivery; represent the current state of the art; comply with applicable and current laws, regulations and guidelines of public authorities, trade associations and professional organizations; comply with safety and accident prevention regulations; and meet the customary technical standards (such as DIN and VDE) at the location where they are received. The contracting party´ s liability extends to the parts manufactured by its subcontractors. The authoritative values for dimensions, quantities and quality are those determined by KOLLER during its check of incoming goods and quality control.

Unless otherwise agreed, the expiration period for material defect claims is based on the provisions of the law (§438 BGB) and begins with the delivery and/ or acceptance of goods that are free from defects at the stipulated destination.

KOLLER must promptly report obvious material defects in the delivered goods in writing as soon as they are detected through the processes of a proper business workflow. Hidden material defects may be reported at any time following their discovery within the expiration period for material defect claims.

If the delivered goods exhibit a material defect at the time of the transfer of risk, KOLLER may demand the repair of the defect or the delivery of goods free from defects, at its discretion. The associated costs are borne by the contracting party.

If the contracting party has made two unsuccessful attempts at subsequent performance, refused subsequent performance without cause or allowed an appropriate deadline extension to elapse, KOLLER may elect to remedy the defect itself or commission a third party to remedy

it on behalf of and at the cost of the contracting party. Here the contracting party must bear all necessary expenses incurred by KOLLER and its agents in remedying the defect and promptly settle any resulting claims. The legal right of withdrawal, the right to compensation for damages - in particular, the right to compensation for damages in lieu of performance - and the right of recourse as defined by §§ 478 f- BGB are reserved.

The expirations period begins anew for parts that are replaced. If ore than 10 % of the goods in a delivery exhibit defects, KOLLER is entitled to reject the entire delivery at the expense of the contracting party without checking the remaining goods. Acceptance of and payment for the goods by KOLLER do not signify KOLLER´ s recognition of the goods as being free from defects.

The contracting party warrants that all deliveries are free from third party rights and especially that the delivery and contractual use of the goods do not infringe upon any patents or other industrial property rights of third parties (defects in title).

Art. VIII. Invoicing

Auditable invoices must be submitted to the postal address of KOLLER upon the delivery of goods or provision of services and must include the complete order data (order number, product number, AV number and ordering party). Invoices may not under any circumstances be enclosed within the consignment of goods. Partial invoices are possible only if corresponding partial deliveries or partial services were agreed. Invoices with incomplete or unverifiable order data will be rejected by KOLLER. After submission of the corrected Invoice, KOLLER will settle the invoice amount, minus the agreed discount, according to the agreed discount period.

Art. IX. Payment Terms

Unless otherwise agreed, complete and correct invoices are paid at a 3 % discount within 14 days of their receipt or in full within 30 days. The payment period begins no earlier than upon receipt of the invoice by mail but not before receipt and acceptance of contractual goods ordered or services rendered.

We do not recognize interest incurred prior to the due date or restrictions to the right to refuse performance, the right of retention or the right to offset.

If partial payment is agreed, the contracting party must submit absolute suretyships when first requested to do so together with the request for payment for all installments paid prior to delivery.

Art. X. Industrial Property Rights

The contracting party is liable for ensuring that the use of the delivered goods does not infringe upon any industrial property rights or other rights or third parties.

The contracting party indemnifies KOLLER from all resulting third party claims and will reimburse KOLLER for all necessary expenses arising from claims.

KOLLER reserves the sole ownership rights, industrial property rights and copyrights to samples, models, illustrations, drawings, calculations or other documents and files provided by KOLLER to the supplier. These items are subject to strict confidentiality and may not be made accessible to third parties without the express consent of KOLLER. They may not be used for the contracting party´ s own purposes or outside purposes and must be returned to KOLLER without charge upon completion of the order.

Art. XI. Product Liability

If the contracting party is responsible for a product defect, it is obligated, following an initial written request, to indemnify KOLLER from third party damage claims to the extent that the cause lies within the contracting party´ s sphere of sovereignty and organization and the contracting party itself is liable to third parties. If such a product defect necessitates recall measures, the contracting party is obligated to reimburse all the necessary expenses that these measures may entail. The parties to the contract will notify each other in advance of the content and extent of any such recall measures, to the extent this is possible and reasonable, and provide each other with an opportunity to express a position. This does not affect other claims to which KOLLER is entitled

Art XII. Retention of Title

KOLLER does not recognize retentions of title by the contracting party in any form whatsoever with the exception of simple retention of title.

Art. XIII. Assignment of Claims

The contracting party is not entitled to assign its claims against us or allow their acquisition by a third party without our written consent, which may not be unfairly denied. If the contracting party assigns its claims without our written consent, the assignment is nevertheless effective. Here KOLLER can - at its own discretion and in discharge of its obligation - perform its own obligations to either the contracting party or the third party.

Art. XIV. Place of Performance and Venue

The place of performance is Celle or the destination expressly named by KOLLER.

Regardless of the object value, the venue for both parties is the lowest court of first instance with jurisdiction over Celle. This venue is not exclusive.

Art. XV. Data Privacy and Data Storage

Personal data that is accumulated in the course of the contractual relationship is recorded and stored for data processing purposes and in compliance with applicable data privacy regulations (§26 of the German Federal Data Privacy Act, Bundesdatenschutzgesetz).

Art. XVI. Applicable Law and Effectiveness

German law applies to the exclusion of the Convention on the International Sale of Goods (CISG).

Each provision of these Purchasing Terms and Conditions is severable (§139 BGB).

The legal ineffectiveness of any one of the above provisions does not affect the validity of the other provisions. The provisions of German lax apply in place of ineffectiveness or omitted provisions of provisions that do not become a component of the contract.

I. Scope of application

1. Koller Maschinen- und Anlagenbau GmbH, its supplies, services and offers shall be exclusively subject to these General Terms and Conditions for Supplies and Services (hereinafter referred to as “Conditions”), unless agreed upon otherwise in writing. Any conditions of the purchaser deviating from or conflicting with these Conditions or other general terms and conditions for purchase are expressly exempted hereby.

2. The Conditions shall be valid only with regard to contractors in the sense of Section 310, section 1 / Section 14 BGB (German Civil code) (contractors, legal entities under public law, special funds under public law).

II. Quotation and conclusion of contract

1. Koller’s offers shall be without engagement and non-binding, unless expressly stated otherwise.

2. Any specifications, drawings, illustrations, dimensions, weights or other parameters and any applicable E-DIN- or VDE-standards or –dates included in quotations, catalogues, electronic media or other advertising media shall not be regarded as guaranteed features but only as simple statements of characteristics unless the parties have otherwise expressly agreed upon in writing. These statements may be modified as long as no contract is concluded, unless such statements are referred to as binding in quotation made by Koller.

3. Koller personnel shall not be authorized to make any additional oral mutual agreements or oral confirmations beyond the content of the written contract. The rights to all images, offers, drawings, descriptions, samples and cost estimates shall be vested with Koller.

4. The purchaser is not allowed to copy, publish those documents or submit them or make them available to third parties. The purchaser shall be obliged to return these documents and data carriers and any copies thereof at request of Koller.

5. Any and all working results such as construction plans / sketches, drawings, specifications, calculations, test results or other documents prepared, developed and/or documented by Koller in the frame of this order remain with and are the property of Koller. An assignment of or the granting of rights in these documents as well as the know-how and the intellectual property rights contained therein to the purchaser are exluded.

III. Prices

1. Unless otherwise stated, Koller shall be bound to the prices quoted in their offer for the duration of 30 days from the date of the offer. Otherwise the prices stated in Koller’s order confirmation plus the corresponding legal VAT shall apply.

2. Any additional supplies and services shall be invoiced separately.

3. Unless otherwise agreed upon, the prices are to be understood on an ex works basis including loading in the factory, but exclusive of packaging and plus VAT at the legally applicable rate.

4. In case of a period of more than six months between the conclusion of a contract and the agreed and/or actual delivery date and Koller not being in default, the applicable price list is the one valid on the day of delivery or supply, unless the parties have expressly agreed upon fixed prices for a certain period.

5. Koller reserves the right to increase its prices accordingly in case that prices have bee subjected to an increase by the sub-suppliers or unexpected increases in costs of wages and transports and provided that the parties have not expressly agreed upon fixed prices for a certain period.

IV. Times of delivery and performance

1. Unless otherwise expressly agreed upon, dates or terms of delivery stated by Koller are non-binding.

2. If the delivery or performance is delayed to Force Majeure and due to any circumstance that substantially and not only temporarily interferes with or prevents Koller fulfilment of their obligations – including in particular strike, lock-out, official directives, etc., even if such circumstances concern Koller suppliers and their sub-suppliers – Koller shall not be bound to the dates or terms of delivery and performance, whether binding or not. Such circumstances shall entitle Koller to either delay the delivery or the performance by the duration of the delaying circumstance plus a reasonable starting period or to withdraw from all or part of the contract by reason of the unfulfilled part of the contract. Koller may only refer to such circumstances if the purchaser has been informed thereof immediately.

3. If the delaying circumstance persists for more than three months, the purchaser, after notification of a reasonable grace period, shall be entitled to withdraw from the unfulfilled part of the contract.

4. If the delivery period is extended or Koller are exempt from their obligation, this shall not entitle the purchaser to derive there from any claims for damages.

5. Koller shall at any time be entitled to partial deliveries and performances if such partial deliveries or performances are reasonable for the purchaser.

6. Fulfilment of Koller’s delivery and performance obligations shall be subject to punctual and orderly fulfilment of the purchaser’s obligations.

7. If the purchaser is in default of acceptance, Koller shall be entitled to claim for compensation of the resulting damage; the risk of incidental deterioration and the risk of accidental loss shall pass to the purchaser upon occurrence of default of acceptance.

V. Passing of risks

The risk shall pass to the purchaser as soon as the consignment is delivered to the person dealing with the transport of the goods or as soon as it has left Koller’s warehouse for shipment. If the shipment is delayed upon the purchaser’s request, the risk shall pass to him upon notification of readiness of dispatch.

VI. Purchaser’s rights in case of defects

1. The products shall be free of any material or manufacturing defects upon delivery. The warranty period for defects shall be one year from the date of delivery. This shall not be apply where longer periods are prescribed by law according to Section 438., §1, No. 2 (buildings and things used for a building) German Civil Code (BGB), in the case of intent, fraudulent concealment of the defect or non-compliance with guaranteed characteristics. The legal provisions regarding suspension of the suspension of limitations and recommencement of limitation periods shall be unaffected.

2. Unless Koller’s operating or maintenance instructions and warnings are complied with or if the products are modified, if any parts are replaced or consumables are used that do not comply with the original specifications, any claims by reason of defective products shall be rejected unless the purchaser refuses the correspondingly substantiated assertion that one of the above circumstances has caused such defect. 

3. The purchaser shall immediately advise Koller’s service manager in writing of any defect, at the latest within one week after receipt of the delivered goods. If it is impossible to detect a defect within this period notwithstanding a thorough check, Koller’s shall be informed about such defect immediately after having detected it.

4. If the purchaser advises Koller of any defective product, Koller’s shall request at their discretion and expense either

- that the defective part or equipment shall be sent to Koller for repair and subsequent return to the purchaser

- than the purchaser shall keep the defective part or equipment and that a Koller service technician shall be dispatched to the purchaser’s works in order to repair the defective part or equipment.

5. The purchaser shall have no claim with respect to expenses incurred in the course of supplementary performance, including costs of travel, transport, labour, and material, to the extent that expenses are increased because the subject-matter of the supplied products has subsequently been brought to another location than the purchaser’s branch office, unless doing so complies with the normal use of the supplied products. If the ratification fails within a reasonable period of time, the purchaser may, at his discretion, claim reduction of payment or withdraw from the contract.

6. Any warranty for normal wear and tear is excluded.

7. Only the direct purchaser shall be entitled to make any claims for defects against Koller and such right shall not be assignable.

VII. Spare parts

Koller shall supply spare parts for the delivered equipment at the currently valid spare parts prices for a duration of five years from delivery of the equipment.

VIII. Reservation of title

1. Until all demands to which Koller is or will be entitled to for any legal reason against the purchaser have been fulfilled
(including all balance demands from the current account), the purchaser shall provide Koller with the following securities, which Koller will release at the demand of the purchaser at their own discretion, insofar as their value exceeds the demand by more than 20%.

2. The delivered goods remain the property of Koller. Processing and transformation of the goods shall always take place for Koller as the manufacturer, however without any obligation for Koller. If Koller’s co-ownership expires due to joining, it shall be deemed already agreed with immediate effect that the purchaser’s (co) ownership in the uniform object shall be transferred to Koller proportional to the share of the value (invoice value). The purchaser shall safeguard Koller’s (co-owned) property free of charge. Goods in which Koller is entitled to (co-) ownership shall be termed reserved goods in the following.

3. The purchaser shall have the right to process and to sell the reserved goods in proper business transactions, as long he is not in delay. Pledging or transfers of ownership as security are not permitted. Any demands (including all balance demands for current account) which result from the further sale or any other legal reason (insurance, non-permitted action) with respect to the reserved goods shall be herewith transferred by the purchaser to their full extent to Koller. Koller irrevocably authorises the purchaser to collect the demands assigned to Koller on his account in his own name. The autorization to collect can only be cancelled if the purchaser fails to meet his payment obligations. 

4. In the case of seizure of the reserved goods by third parties – in particular pledging – the purchaser shall inform the third party about Koller’s ownership and shall immediately inform Koller accordingly to enable them to enforce their ownership. The purchaser shall be held liable for any legal costs incurred by Koller in this connection if the third party is not able to reimburse such costs.

5. In the case of contract infringements by the purchaser, especially in case of delayed payment, Koller shall be entitled to withdraw from the contract and to claim possession of the reserved goods. The exercise of the reserved title or taking back goods shall not be considered as a withdrawal from the contract.

IX. Payment

1. Unless otherwise agreed upon, Koller’s invoices shall be due 14 days after the date of invoice without any deductions, however, not later than 30 days after delivery.

2. A payment shall not be deemed to be made unless Koller can dispose of the amount. If payment is made by cheque, the payment shall not be deemed to be made unless the cheque has been paid.

3. If the purchaser is in delay, then Koller shall be entitled to demand payment of interest of at least 8 percentage points above the base rate as liquidated damages. Koller shall have the right to provide evidence of a higher damage due to the delay.

4. If after the conclusion of a contract Koller becomes aware of any circumstances which challenge the creditworthiness of the purchaser, especially if a cheque is not paid or if the purchaser stops payment or if Koller becomes aware of any other circumstances which challenge the creditworthiness of the purchaser, then Koller shall be entitled to accelerate maturity of the total remainder of the debt, even if Koller has already accepted any cheques. Koller shall in this case also be entitled to demand advance payments or securities.

5. The purchaser shall only be entitled to invoke a setoff, withholding or abatement right, even after notification or defects or enforcement of counterclaims, if the counterclaims are legally binding or undisputed.

6. The purchaser shall not be entitled to invoke a withholding right for counterclaims unless such claims arise from the same contractual relationship.

X. Design modifications

Koller reserves the right to modify the design at any time, unless this will lead to an impairment of the intended use of the delivered goods and only in case that it is reasonable for the purchaser. Koller, however, shall have no obligations to carry out such modifications on products already delivered.

XI. Industrial Property Rights

1. Koller shall hold the purchaser and his customers harmless of any claims for infringement of copyrights, trademarks or patent rights, unless the design of a delivered good originates from the purchaser. The amount of this obligation is limited to the foreseeable damage. Koller’s obligation to hold the purchaser harmless of the above claims is additionally based on the condition that the right to institute legal proceedings is relinquished to Koller and that the alleged infringement is exclusively imputable to the design of the goods delivered by Koller without any connection or use of other products. 

2. Koller shall have the right to get released from their obligations mentioned in paragraph 1 by either

- Obtaining the required licences concerning the patents that are said to have been infringed

- Placing a modified version of the delivered good or parts of it to the purchaser’s disposal in order to ensure that the reproach of infringement concerning the delivered good is eliminated if the modified delivered product or part of it replaces the infringed delivered product or part of it.

XII. Nondisclosure

Unless otherwise explicitly agreed upon in writing, the information submitted to Koller in connection with the order shall be deemed to be confidential.

XIII. Liability

1. Any indemnity claims, irrespective of the type of neglect of duty, including inadmissible actions, shall be excluded, unless there is evidence of wilful intent or gross negligence.

2. In case of infringement of substantial contractual obligations Koller shall be responsible for any wilful intent, but only up to the amount of the foreseeable damage. Any claims for loss of profit, saved expenses, indemnity claims of third parties and for other collateral and subsequent damages may not be asserted, unless a characteristic guaranteed by Koller is explicitly intended to protect the purchaser against such damages.

3. The limitations and exclusions of liability mentioned in paragraphs 1 and 2 shall not apply to such claims that derive from Koller’s fraudulent behaviour neither to liability of guaranteed characteristics, to requirements under the Product Liability Act and damages because of death and injury of body or health.

4. As far as Koller’s liability is excluded or limited, this shall also apply to employees, wage earners, agents and persons employed to perform an obligation of Koller.

XIV. Applicable law, place of jurisdiction, severability

1. These conditions and the entire legal relationship between Koller and the purchaser shall be subject to the jurisdiction of the Federal Republic of Germany. The provisions of the United Nations Convention on Contracts for the International Sale of Goods shall not apply.

2. The place of jurisdiction for any dispute directly or indirectly arising out of or in connection with the contract shall be the court in Celle. Koller shall have the right to bring an action against the purchaser at his general place of jurisdiction.

Koller Maschinen- und Anlagenbau GmbH, Bruchkampweg 5, D-29227 Celle

August 2010