General Terms of Business

I. Validity
These general terms of sale, delivery and payment shall apply exclusively to all contracts, deliveries and other services between us and our business partners – even if they are not specifically referred to in individual cases. Any other special agreements at the conclusion of the contract or thereafter shall only become a legally valid element of the contract by our written confirmation. The terms of sale, delivery and payment shall also apply even if the business partner notifies or has notified us of its own terms of delivery which differ from our terms and conditions. Such terms of the business partner shall not become binding even if we do not explicitly object to them.

II. Offers and conclusion of contract
1. Our offers shall be without obligation if no periods or deadlines are stated. Any contracts and other agreements between us and the business partner shall only become binding if they are confirmed by us in writing.
2. Any alterations and additions to the agreements that have been made shall require our written confirmation in order to be effective.
3. We reserve ownership and copyright of illustrations, drawings, calculations and other documents. This shall also apply to all written records which are declared to be “Confidential”. The purchaser must obtain our explicit written permission before passing them on to any third parties.
4. We shall be entitled to commission sub-contractors to fulfil our obligations.

III. Despatch, transfer of risk, partial deliveries
1. In the absence of any separate agreement the packaging, means of shipping and means of transport shall be left to our discretion.
2. The shipping shall take place at the expense and risk of the purchaser.
3. The risk shall pass to the purchaser when the goods are handed over to the carrier that has been selected for the shipping, even if delivery is "free to destination". At the request and expense of the purchaser, we shall insure the consignment against theft, breakage, transport, fire or water damage and other insurable risks
4. Partial deliveries and partial services shall be permissible.
5. Excess or short deliveries shall be accepted in accordance with normal trade practice.

IV. Delivery and service periods and delivery dates
1. Compliance with the completion and delivery periods shall be subject to the correct and timely availability of supplies and raw materials. We shall notify the purchaser promptly of any delays, stating the reason and giving a new completion and delivery date. The same shall apply if the purchaser changes or extends the originally agreed performance.
2. Delivery periods and performance times shall begin with the receipt of our confirmation of order, but not before the clarification of all details of the implementation, including without limitation any necessary approvals, release or compliance with other obligations.
3. The delivery periods and delivery dates shall be deemed to have been met when we give notification of readiness for shipment, even if the goods cannot be sent out or collected by the purchaser on time through no fault of ours.
4. If we ourselves fall into default, or if delivery on time becomes impossible for reasons for which we are responsible, the purchaser shall be obliged to set us a reasonable extension period. After the expiry of this extension period, the purchaser shall be entitled to revoke the contract insofar as it has not yet been fulfilled or the goods have not yet been notified as ready for despatch.

V. Hindrance of delivery
1. In the event of strike, lockout, operational disruption, force majeure and any other hindrances which are beyond our control, we shall be entitled to decline to deliver in whole or in part, and the purchaser shall not be entitled to make any claims for compensation or to demand subsequent delivery.
2. If the purchaser fails to carry out acceptance of goods that have been ordered, it shall nevertheless be obliged to pay the purchase price.
3. If the purchaser declares that it does not wish to accept the goods before the goods have been produced, it shall be obliged to pay compensation for loss of profit and for the costs which have arisen.

VI. Prices and payments
1. The purchaser shall only be entitled to offsetting rights if its counter-claims have been awarded by an unappealable ruling, are undisputed or have been accepted by us. Furthermore, the customer shall only be entitled to a right of retention insofar as the counter-claim is based on the same contractual relationship.
2. The conditions of payment e. g. down pay-ment with the order, amount payable after delivery and amount payable after accep-tance, shall be contractually laid down in the offer and the order confirmation.
3. The purchaser shall be informed separately of the conditions under which discounts are granted.
4. In the event of late payment, default interest shall be charged at a reasonable level, but at least 8 % above the applicable discount rate of the German Federal Central Bank. The right to claim compensation for further damage or loss is reserved.
5. Accepted bills, bills of exchange and cheques shall only be accepted on account of payment. Credit amounts for bills of exchange and cheques shall only be granted subject to receipt and minus expenses, with effect on the date on which we have disposal over the proceeds.
6. If the purchaser falls into arrears with the fulfilment of its payment obligations, bills of exchange are protested, its assets are seized or there is a significant deterioration in its assets situation, we shall be entitled to revoke the supply contract. In this case we shall only be obliged to make further deliveries if the purchaser offers cash payment on delivery.
7. If the purchaser does not offer cash payment, we shall be entitled to claim damages for non-fulfilment in lieu of fulfilment or to revoke the contracts insofar as deliveries have not yet been made.
8. Any retention of payments because of any claims of the purchaser which we do not accept, and any offsetting against any accounts receivable, are excluded.

VII. Reservation of ownership
1. We reserve ownership of all goods supplied by us until the purchaser has paid all of the amounts outstanding in the business relationship, including without limitation any current account balance. The provision of a bill of exchange or cheque shall not be deemed to be a payment until it has been encashed.
2. The purchaser shall be entitled to join or mingle the reserved goods with goods not belonging to us in the course of its normal business operations. In this case, we shall acquire a co-ownership share.
3. As long as it is not in default, the purchaser shall be entitled to resell the supplied goods (reserved goods) to one or more customers in the course of its normal business operations with or without treatment or processing. This shall only apply subject to the proviso that the account receivable from the resale is assigned to us. The purchaser shall not be entitled to dispose of the reserved goods in any other way.
a. If respite of payment is granted to the customers for the sales price, the purchaser shall reserve ownership of the goods delivered to its customer on the same terms on which we have reserved ownership on delivery of the reserved goods to the purchaser.
b. The purchaser herewith assigns to us in advance the purchase price claim which it will have under the resale to its customers, irrespective of whether the reserved goods are sold with or without treatment and processing and whether they are sold to one or several customers.
c. If the reserved goods are sold jointly with other goods not belonging to us, the assignment of the payment claim arising from the resale shall only apply up to the value of the reserved goods at the time of delivery to fulfil the resale.
d. If the reserved goods are resold after processing, especially after processing with other goods not belonging to us, the assignment shall only be deemed to have taken place for the value of the reserved goods at the time of processing.
e. If the purchase price agreed between the purchaser and its customer is lower than the value of all goods which form the subject of the contract with the customer, the claim arising from the resale shall be assigned to us in full.
4. The reservation of ownership according to the above agreements shall continue to apply even if individual accounts receivable are included in a current account and the accounts have been balanced and accepted.
5. When all of our accounts receivable arising from the business relationship hase been paid in full, both the ownership of the reserved goods and the assigned claims shall be transferred to the purchaser.
6. Furthermore, the purchaser shall be obliged to notify us without delay in writing of any seizure of the goods and/or any other claims which third parties may make concerning the goods. In the event of seizure, the vendor shall also be sent a copy of the record of the seizure and a solemn declaration stating that the reservation of ownership agreed in these Terms of Business still applies and that the seized goods belong to the goods which are subject to the agreed reservation of ownership. If the accounts receivable are seized, a solemn declaration shall be made stating that the accounts receivable have arisen from the sale of reserved goods.
7. If we so demand, the purchaser shall be obliged at any time to inform us of where the goods supplied under reservation of ownership are and what accounts receivable have arisen from the resale.
8. The costs resulting from the enforcement of our rights shall be borne by the purchaser.

VIII. Liability for defects and warranty
1. The purchaser shall be obliged to comply with its inspection and notification obligations under Section 377 of the German Commercial Code (HGB); any notification of defects must be made in writing. Liability is excluded unless any contrary provisions are stipulated below; in particular but not exclusively, any claims for compensation for loss or damage which has not arisen from the supplied object or service are excluded.
2. Insofar as there is a defect in the supplied object we shall be entitled, at our discretion and without any legal obligation, to provide subsequent fulfilment by remediating the defect or supplying new defect-free goods. In the event of subsequent fulfilment, we shall remedy or replace free of charge all parts which are found to be defective due to circumstances before the transfer of risk. Expenditure incurred in remedying defects shall only be charged up to the value of the contractual price. Replaced parts shall become our property.
3. Any restart of the warranty period as a result of subsequent fulfilment is excluded.
4. For the subsequent fulfilment, the purchaser shall grant us the necessary access to the supplied object and the necessary time; otherwise we shall be released from our liability for any resulting consequences.
5. Liability for fraud and any guaranteed characteristics shall remain unaffected.
6. We shall be liable according to the statutory provisions if the purchaser makes claims for compensation which are based on wilful damage or gross negligence, including intentional damage or gross negligence by our representatives or vicarious agents. If we are not held responsible for any intentional violation of the contract, the liability for damage shall be limited to the foreseeable loss or damage which typically occurs
7. We shall be liable under the statutory provisions insofar as we have culpably violated any major contractual obligation; in this case, however, liability for compensation shall be limited to the foreseeable loss or damage which typically occurs.
8. This shall not affect liability for culpable damage leading to death, injury or damage to health, nor to mandatory liability under the German Product Liability Act.
9. All warranty claims are excluded if the purchaser has processed or resold the goods after it had discovered or should have discovered the defect.
10. For the remediation of defects to take place, the purchaser shall provide the object that is claimed to be deficient or samples there of. If it refuses to do so, all claims for defects shall lapse.
11. The right of the purchaser to enforce claims arising from defects shall expire by limitation in all cases 12 months after notice of the defect has been given.
12. The warranty period shall be 3 months for repairs and 6 months for replacement deliveries or services. It shall run at least until the end of the original warranty obligation for the supplied object or service. The warranty period for defects shall be extended by the duration of any operational disruption which arises because repairs, replacement deliveries or services become necessary; this shall apply to all parts of the objects which cannot be operated for their designated purpose because of the disruption.
13. These periods shall not apply insofar as the law stipulates longer mandatory periods.
14. Any other claims of the purchaser against us are excluded, including without limitation any claim for compensation of loss or damage which has not arisen from the supplied object or service.
15. Any transport damage shall be promptly notified to the haulage contractor or the party responsible for the transport.Return consignments shall only be permissible with our explicit consent and must be free of freight charges.

IX. Liability
Our liability shall be exclusively as stipulated in the agreements made in the above sub-sections. All claims not explicitly granted therein, including claims for compensation – on whatever legal grounds – are excluded. Otherwise, we shall only be liable for deliberate action and gross negligence.

X. Usage rights for software supplied with the goods
If the supplied object contains software programs, the purchaser is awarded simple, non-exclusive usage rights to the software and the supplied documentation. The software is only supplied for use on the supplied object. Any usage over and above this is prohibited.

XI. Place of performance, place of jurisdiction, applicable law
The place of performance and sole place of jurisdiction for deliveries, services and payments and for all disputes arising between the parties shall be the headquarters of PROAUT TECHNOLOGY GmbH insofar as the purchaser is a registered trader.The relationship between the parties to the contract shall be governed exclusively by German law as applicable in the Federal Republic of Germany unless any contrary provisions are explicitly agreed.

XII. Concluding provisions
If any individual provisions of these General Terms of Business should be or become invalid for any reason, this shall not affect the validity of the other provisions. The parties to the contract shall replace any invalid provisions by mutually agreed provisions which are equivalent in their economic effect; the applicability of UN commercial law is excluded.