General Terms of Sale

1. Preface

1.1 Our products are exclusively offered to entrepreneurs in terms of Section 14 BGB (German Civil Code) and legal entities under public law. They are not offered to sub dealers, provided their customers are consumers.

1.2 The following general terms and conditions exclusively apply to the delivery of all our goods and services. Other general terms and conditions shall not apply, even if we do not contradict them expressly.

1.3 Our terms of sale shall also exclusively apply to all future deliveries and services, even if not explicitly stipulated in a future contract.

2. Conclusion of Contract

2.1 Our quotations are subject to change.

2.2 A contract is concluded at the earliest after the receipt of our written order confirmation. Amendments and supplements to this contract must be made in writing in order to be effective.

3. Delivery, Prices, Shipping Costs, Risk of Transport

3.1 Our deliveries, services and prices shall be ex works (Factory Maxdorf); the costs of packaging are not included.

3.2 In the event a freight paid delivery has been agreed, it only applies to ordinary freight and postal shipments. If the purchaser requests shipment by express parcel post, express goods shipment or parcel, we are not obliged to compensate the additional costs compared to the ordinary shipment fee.

3.3 If the contract fulfillment lasts longer than four months from the conclusion of the contract, we are entitled to subsequently raise the price for the goods in case the costs of sales of the goods (raw material costs, energy costs, wages and salaries etc.) have increased in the meantime. The increase implies that the costs have risen by at least 5%. The extent of the increase has to correspond to the percentage amount by which the cost of sales has risen. If the price is increased by more than 10%, the purchaser has the right to withdraw from the contract.

3.4 The minimum order value is EUR 50.00 net.

4. Terms of Payment

Payments by the purchaser have to be effected within 14 days from the date of invoice minus 2% discount or within 30 days net (without cash discount deduction). The discount will be granted only on condition that all previous payment obligations to EM-Technik have been fully satisfied.

5. Delivery Dates

5.1 The goods are deemed as shipped in a timely manner if the delivery item has left our factory by the time of the quoted delivery date.

5.2 Delivery dates quoted by us shall only be deemed a guideline. Delivery dates are only considered binding if they are explicitly agreed to as fixed dates in writing.

5.3 As far as a fixed date has been agreed to, there is no obligation to effect a timely delivery if

a. events and circumstances occur which affect the production of goods and are beyond our control (e.g. governmental decrees or official measures, business disruptions, shortage of raw material and/or energy, breakdown of transport),

b. without any fault on our part our raw material suppliers do not deliver on time and a procurement of raw material by another distributor is impossible or unreasonable.

c. further specifications of the purchaser are needed to manufacture the goods and the purchaser fails to provide such information immediately.

5.4 In the event of section 5.3., the fixed delivery date is postponed according to the duration of the production breakdown plus a reasonable start-up period.

5.5 Should the events and/or circumstances mentioned in section 5.3. last longer than three months, EM-Technik is entitled to withdraw from the contract.

5.6 Partial deliveries and invoices for partial deliveries are acceptable if they are reasonable for the purchaser.

6. Retention of Title

6.1 EM-Technik retains ownership of the delivered goods in either case until all payments arising from the delivery contract are settled.

6.2 If the purchaser has paid for all goods delivered, but other contractual liabilities arising from the business relationship with the purchaser have not been met, we retain ownership of the delivered items until all payments have been settled.

6.3 If the joining of goods delivered by us with the purchaser’s object occurs in such a way that the purchaser’s object is to be regarded as the principal object, then it is considered as agreed that the purchaser transfers a share in the title to us, at a ratio of the invoice value of the goods delivered by us to the invoice value (or the market value in default of the invoice value) of the principal object. The purchaser shall safeguard the thus created property for us free of charge.

6.4 The purchaser is entitled to resell or transfer the goods subject to retention in the proper course of business as long as the payment obligations arising from the business relationship with us are met. All claims arising from the resale of goods subject to retention by EM-Technik shall in advance be assigned to EM-Technik by the purchaser at the time the contract is concluded. We revocably authorize the purchaser to collect in his own name the claims assigned to us in advance. This authorization is only then revoked if the purchaser is in default of payment to us and/or has filed an application for the opening of insolvency proceedings.

6.5 The purchaser is not permitted to pledge the reserved goods or to transfer ownership of them as security.

If the goods subject to retention of title or the claims assigned to us in advance become involved in recovery actions by third parties, the purchaser must immediately notify EM-Technik. Any costs of judicial proceedings for successful interventions have to be reimbursed by the purchaser, provided that the third party involved is not able to reimburse the costs.

6.6 If the value of the collateral exceeds the claims we have against a customer by more than 10%, we shall release the respective collateral at our discretion at the customer’s request.

7. Set-Off and Right of Retention

The purchaser is only entitled to offset or exercise any right of retention over our claim for payment if his counterclaim is undisputed, has been established by a court of law or is ready for a decision by court.

8. Defects, Inspection Duties

8.1 Defects that already existed at the time of the transfer of risk will be corrected at our discretion by replacement delivery or repair.

8.2 The customer shall not be entitled to assert any claim for defects in case of only minor deviations from the agreed condition and only minor impairment of usability.

8.3 The purchaser has the statutory duty, pursuant to Section 377 HGB (German Commercial Code), to inspect the goods and notify us of any defects. Obvious defects must be reported immediately or within 8 working days after receipt of the goods. Hidden defects must be reported immediately upon discovery or within 8 working days after discovery. Otherwise the goods shall be deemed approved. The defects must be notified in writing and must state precisely the nature and extent of the defect.

8.4 The purchaser’s claims for defects in the goods are subject to a warranty period (Gewährleistungsfrist) of one year from receipt of the goods.

Instead of the one-year limitation period, the statutory period of limitation shall apply if

a. the purchaser’s claims refer to liability claims for expenses and damages that the purchaser can assert due to defects by statutory law in accordance with section 9.1.

b. the goods have been used in the construction of a building corresponding to their normal manner of use and have caused that building to be defective.

9. Liability

9.1 We are liable for damages in accordance with statutory and legal requirements

a. in the event of injury to life, body or health,

b. in the event of intent and gross negligence by us,

c. in the event of defects which we have maliciously concealed or whose absence we have guaranteed,

d. in the event of defects in the delivered goods, insofar as we are liable for personal damages even without any fault in accordance with the German Product Liability Act (Produkthaftungsgesetz).

9.2 In addition, we are liable for violations of a fundamental contractual obligation (cardinal obligation) caused by at least slight negligence. In this event our indemnifiability shall be limited to typically incurred and foreseeable losses. Cardinal obligations are obligations which are imposed on EM-Technik by the contract in order to reach the contractual purpose whose fulfilment renders possible the correct implementation of the contract in the first place and on whose observance the purchaser may usually rely.

9.3 Any further liability going beyond the content of sections 9.1 and 9.2 is hereby excluded.

10. Product Specifications, Guarantees, Consulting Services

10.1 The product’s properties shall be exclusively defined by our product specifications (drawings, technical specifications), unless otherwise expressly agreed.

10.2 Statements to condition and longevity as well as any other specification shall only constitute a guarantee (Garantie) if they are designated as such and agreed upon in writing.

10.3 Our advice on the specific use of our products, in particular the selection of the material, shall be understood only as a nonbinding recommendation for which we assume no liability in form of warranty and guarantee claims. In the specific application the resistance of the material is influenced by many variables (e.g. temperature, concentration ratio, environment etc.) that our advice cannot finally evaluate. For the specific use intended by the purchaser the suitability of our products has to be tested under field conditions, – if possible – installed on a trial basis, and is the sole responsibility of the purchaser.

11. Models, Technical Documents, Rights of Use, Confidentiality, Data Privacy

11.1 To our models, technical documents, drawings, plans, calculations etc. (hereinafter referred to as “work materials”), we retain the rights of ownership and copyright. Such objects and documents may be used solely under the purpose of the contract.

11.2 The purchaser shall grant us the use and exploitation rights, barred from any restraints in space, content and time for all working materials relating to the manufacturing of the goods.

11.3 The purchaser shall treat all commercial and technical information within the business relationship which are not evident as confidential and shall not disclose that information to third parties.

11.4 We point out that we store personally identifiable information that is transmitted to us in the scope of the business relationship. For the execution of the contract it may be necessary to disclose personally identifiable information within the EM-Technik group.

12. Commercial Terms

Interpretation and application of the trade terms agreed upon pursuant to the International Commercial Terms (Incoterms) shall be subject to the Incoterms ® 2010.

13. Written Form

The requirement of written form set forth in these terms of sale is also met in case of a transmission via e-mail and fax.

14. Final Provisions

14.1 The place of performance shall be Maxdorf.

14.2 The contract and the legal relationship between the parties shall be governed by the law of the Federal Republic of Germany. The United Nations Convention on Contracts for the International Sale of Goods (CISG) is excluded.

14.3 If the purchaser is a merchant or a legal entity by public law, the exclusive place of jurisdiction for all disputes shall be EM-Technik’s place of business. In case a suit is filed by EM-Technik, legal proceedings can alternatively also be instituted at the purchaser’s place of jurisdiction.

(Version: August 2011)