General Terms and Conditions of Business

MOStron Elektronik GmbH - General Terms and Conditions

General Terms and Conditions of Business of MOStron Elektronik GmbH

I. Scope of application

The following provisions shall be included in and be an integral part of all Terms and Conditions of Business initiated between MOStron Elektronik GmbH - further referred to as "MOS" - and its customers who are entrepreneurs or legal entities under public law or public-law funds. They shall also apply to existing commercial relations unless the customer objects in writing within 2 weeks of first receiving them.

II. Offer and Conclusion of Contract

1. Contracts with MOS shall arise exclusively on the basis of these Terms and Conditions. No deviating General Terms and Conditions of the customer shall become an integral part of the contract, even where MOS is aware of the same, unless specifically accepted in writing by MOS. This shall also apply to the customer's supplemental General Terms and Conditions.
2. Offers from MOS are non-binding. We reserve the right to make reasonable technical alterations and alterations to shape, colour and/or weight. No oral or telephone arrangements with our employees shall be binding on MOS unless confirmed in writing by MOS.
3. The acceptance of an order by MOS may either be expressed in writing or by delivery of the goods to the customer.
4. MOS points out that some of the products it sells are developed and manufactured abroad. The contract shall be concluded subject to delivery in the proper and timely manner. MOS shall ensure the conclusion of a related covering transaction with MOS's own supplier. Should MOS, for reasons which are not MOS's responsibility, not be supplied by one of its pre-suppliers as contractually agreed, MOS may rescind the contract. The customer shall be immediately notified that performance on the part of MOS is unavailable. Any consideration received shall be immediately returned by MOS to the customer.

III. Reservation of title

MOS shall retain title to the products delivered to the customer until all claims arising from any ongoing business relations with the customer have been paid in full. As long as the goods are subject to MOS's reservation of title, the following shall apply:

1. The customer shall be obliged to take proper care of the goods. To the extent that maintenance and inspection works are required, the customer shall regularly perform these at its own expense.
2. The customer shall store the reserved goods separately and mark them as the property of MOS. The customer shall, at its own expense, insure the reserved goods against theft, fire and water damage. It shall prove this to MOS upon request. Any future entitlement under such an insurance contract shall, upon the order being placed, be assigned to MOS in the amount of the claims MOS has against the customer. Where the customer does not provide evidence of such insurance immediately upon MOS's request, MOS shall be entitled to insure the goods delivered against the aforementioned risks at the customer’s expense.
3. The customer shall be obliged to notify MOS without delay of any seizure or the assigned claims of the reserved goods by third parties. This shall apply to any damage, deterioration or destruction of the goods. The customer shall also immediately notify MOS of any change to the person holding the goods as well as of its own change of address or registered office. Notices to MOS shall be given in writing.
4. MOS shall be entitled to demand the return of the goods where the customer is in breach of contract and this endangers the goods themselves or their payment. This shall apply in particular to any delay in payment or application to initiate insolvency proceedings of the customer's assets.
5. The customer shall, in the aforementioned cases, be obliged to surrender the goods to MOS.
6. The customer shall be entitled to dispose of the goods in the normal course of business. However, it shall not be entitled to pledge the reserved goods. Similarly, the customer may not transfer the goods to third parties by way of security. Upon placing the order, the customer assigns to MOS all claims, including future claims, from the further processing and further sale of the goods delivered by MOS which accrue to it vis-à-vis a third party as a result of such further disposal. Similarly, it assigns to MOS the balance due to MOS on an open account with the customer's buyer in the amount of the claims MOS has against the customer. Despite the assignment, the customer shall be entitled to recover the claim. However, MOS may itself also recover the claim, in particular once the customer fails to properly perform the payment obligations towards MOS.
7. Where the reserved goods are processed with items which do not belong to MOS via the customer or one of its representatives, MOS shall acquire co-ownership of the new item pro rata to the value of the goods delivered by MOS to the other processed items. The same shall apply where the goods are combined with other items which do not belong to MOS.
8. MOS hereby accepts all the assignments by the customer listed in these Terms and Conditions of Business.

IV. Prices and Payments

1. All prices are quoted net of statutory value added tax.
2. Unless otherwise agreed, the agreed prices and payments shall be valid for 3 months from the date of the written order confirmation. Where delivery occurs later than 3 months after receipt of the written order confirmation, MOS shall be entitled to a reasonable price increase where the pre-supplier's or manufacturer's prices or customs and other taxes have increased since the order confirmation from MOS.
3. The minimum order value per purchase order item is 500.00 EUR.
4. For initial orders and goods worth less than 1000.00 EUR, delivery is subject to cash on delivery or prepayment.
5. A 2% discount is granted if payment is made within 8 days of delivery of the goods; otherwise, payment shall be the full net price within 30 days.
6. Invoices for spare parts, repairs, training and installation are due immediately net and in cash and may be collected on the basis of cash on delivery.

V. Partial delivery, call orders

1. MOS shall be entitled to make partial deliveries. The relevant part purchase price shall be payable under the above Clause IV of the Terms and Conditions.
2. Call orders shall be valid for a maximum of 9 months. Following expiry of this period MOS may without further inquiry deliver to the customer the outstanding amounts not yet called upon.

VI. Delivery costs/insurance

1. Transport, insurance, postage and packing as well as any storage costs shall be for the customer’s account.
2. MOS takes out transport insurance of up to 0.5% of the value of the goods - shall be borne by the customer.

VII. Assignments/Set-offs

1. The assignment and the sale of guarantee and compensation claims to third parties without the written consent of MOS shall be excluded.
2. With respect to MOS claims, the customer may only set off counterclaims which are undisputed or established by the courts or which are made in a case ready for a court decision.

VIII. Liability for defects

1. The manufacturer's technical descriptions of the goods are performance descriptions which state the quality of the goods.
2. Claims and statements by employees of MOS regarding the qualities and features of the products which are not consistent with the same shall be ignored unless confirmed in writing by MOS.
3. MOS shall not be liable for the suitability of the delivered goods for the application intended by the Customer.
4. Complaints in respect of visible defects shall be made by the customer no later than 8 days after receipt of the goods. Complaints in respect of hidden defects shall be made by the Customer immediately after discovery. Complaints shall be made in writing. Prompt dispatch of the complaint shall suffice to comply with the relevant time limits.
5. The guarantee period for product defects shall be one year from transfer of the goods to the customer.
6. In the case of defects MOS shall provide subsequent performance by removing the defect (making good) or delivering an item free of defects (replacement) or alternatively by repaying the invoice value of the defective item. MOS shall select the form of subsequent performance.
7. MOS reserves the right to make a second selection. Accordingly, upon failure of subsequent performance, the customer reserves the right to demand a reduction in the remuneration or to announce its intention to rescind the contract at its discretion. Should MOS delay subsequent performance, the buyer may only rescind the contract if a further time limit of at least 3 weeks, imposed on MOS by the customer, has elapsed without success.
8. Subsequent performance occurs only in return for the surrender of the defective item. The customer shall be obliged to allow MOS to inspect the defective item delivered, at its discretion either at the customer's premises or those of MOS. To the extent the customer denies MOS inspection, MOS shall be released from the guarantee.
9. The costs of transport and materials as well as the labour costs of its own or of the workshop engaged by MOS to provide subsequent performance shall be borne by MOS. The customer shall bear any further expenses for the purpose of subsequent performance.

IX. Compensation

1. For claims under the Product Liability Act or a breach of obligation due to wilful intent and gross negligence attributable to MOS and in cases of physical injury, damage to health or loss of life on the part of the customer attributable to MOS, MOS shall be liable - and for its agents - within the scope of the statutory provisions.
2. In the case of a deliberate or a gross negligent breach of obligation on the part of MOS's representatives and agents, MOS's liability shall be limited to normal, contractual, foreseeable damage.
3. In the case of a negligent breach of non-material obligations MOS shall not be liable.
4. The above Terms and Conditions shall apply correspondingly to such claims by the customer as arise in the course of suggestions or consultations made in the scope of the contract or through a breach of obligation to provide information, tips or advice.

X. Export Control Provisions

The goods supplied may be subject to export control provisions. In the case of export, the necessary export permits or re-export licences shall be applied for from the responsible authorities. The buyer shall be responsible for compliance with export control provisions up to the end user.

XI. Place of payment and performance, jurisdiction

The place of payment and performance shall be MOS's registered office. The place of jurisdiction for all disputes with full traders shall be the local court de facto responsible for the area in which MOS's registered office is located. The laws of the Federal Republic of Germany shall apply exclusively.

Draft 06/2010