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General Terms and Conditions of Sale and Delivery

I. Scope of Application

1. The following Terms and Conditions of Sale and Delivery shall apply to all contracts concluded between the buyer and us concerning the sale and delivery of goods. They shall also apply to all future business relations, even if not expressly agreed upon once again. Deviating terms and conditions of the buyer which are not expressly recognised by us shall not be binding upon us, even if we do not expressly object to them. Our Terms and Conditions of Sale and Delivery shall apply even if we carry out the buyer's order unconditionally in the knowledge of contrary or deviating terms and conditions of the buyer.

2. Verbal collateral agreements shall only be binding for us if we have confirmed them in writing. A waiver of the written form requirement must be in writing.

3. The Terms and Conditions of Sale and Delivery shall only apply to entrepreneurs in the sense of Section 14 of the German Civil Code (BGB), legal persons under public law and special funds under public law; it shall not apply to consumers (Section 13 of the BGB).

II. Conclusion of Contract

1. We may accept any order from the buyer which can be qualified as an offer to conclude a purchase contract by sending an order confirmation within two weeks or by shipping the ordered products within the same period.

2. For the purpose of performing a credit check on the buyer, and provided that we have demonstrated a legitimate interest, we shall be entitled to retrieve any address and financial data for the buyer that has been stored, including such data that can be determined on the basis of mathematical and statistical methods, via the companies Bürgel Wirtschaftsinformationen GmbH & Co. KG, Postfach 500166, 22701 Hamburg, Germany; Creditreform, Stuttgarter Str. 35, 73430 Aalen, Germany; and Bisnode D&B Deutschland GmbH, Robert-Bosch-Str. 11, 64293 Darmstadt, Germany. To enable decisions concerning the establishment, execution or termination of the contractual relationship, we shall collect or use probability figures calculated using information including address data.

3. Our offers shall be non-binding and subject to change, unless we have expressly designated them as binding.

4. We hereby reserve the title, copyright and all other property rights to all pictures, calculations, drawings and other documents. The buyer may only pass on such pictures, etc. to third parties with our written approval, irrespective of whether we have identified such pictures, etc. as confidential.

III. Terms and Conditions of Payment - Prices

1. Our prices are ex works and do not include packaging, unless stipulated otherwise in the order confirmation. Our prices do not include the statutory value added tax. We shall disclose the amount of value added tax applicable on the invoice date separately in our invoice.

2. Cash discounts are not permitted unless otherwise agreed in writing between us and the buyer. The purchase price shall be payable without deduction immediately upon receipt of the invoice by the buyer if no other payment term is specified in the order confirmation. A payment shall only be deemed to have been made when we are able to dispose of the amount. In the case of cheque payments, payment shall only be deemed to have been made when the cheque is cleared.

3. If the buyer is in default of payment, the following regulations shall apply.

4. The buyer shall only be entitled to set-off, even if complaints or counterclaims are being made, if the counterclaims have been determined in a final and legally binding manner, have been acknowledged by us or are undisputed. The buyer shall only be authorised to exercise a right of retention if his/her counterclaim is based on the same contractual relationship. We shall be authorised to exercise a right of retention on all receivables arising from the business relationship with the buyer.

IV. Delivery Time, Performance Time and Delivery Delays

1. Delivery dates or periods which have not expressly been agreed as binding are exclusively non-binding information. The delivery time quoted by us shall only commence when the technical issues have been clarified. Similarly, the buyer is obliged to fulfil all of the obligations to which he is subject, both properly and in a timely manner. We reserve the right to the defence of lack of performance of the contract.

2. In the event of delay, we shall be liable in accordance with the statutory provisions if the buyer is able to justify that he has no further interest in fulfilment of the contract as a result of a delay in delivery for which we are responsible, if we have guaranteed delivery periods or if the delivery delay is based on an intentional or grossly negligent breach of contract for which we, our representatives or our vicarious agents are responsible.

3. In the event that a delivery delay for which we are responsible – and where a fault on the part of our representatives or vicarious agents is to be ascribed to us – is due to a grossly negligent or intentional breach of contract on our part or a slight breach of a fundamental contractual obligation on our part, we shall be liable in accordance with the statutory provisions, with the proviso that in such cases our compensation liability is limited to the foreseeable, typically occurring damage or loss.

4. The buyer’s other statutory claims and rights which arise in addition to the compensation claim due to a delivery delay for which we are responsible shall remain unaffected by this. If a culpable breach of a non-fundamental contractual obligation caused by us leads to a delivery delay for the buyer, the compensation claim for this shall be limited to 25% of the delivery value.

V. Transfer of Risk – Dispatch/Packaging

1. Loading and dispatch shall take place without insurance at the buyer’s risk, "ex stock" or "ex works", unless otherwise specified in our order confirmation. We shall endeavour to take into account the dispatch type and the dispatch route wishes and interests of the buyer; any additional costs caused by this – even in the case of agreed freight-free delivery – shall be borne by the buyer.

2. We shall not take back transport packaging or any other packaging in accordance with the German Packaging Ordinance; pallets are excluded. The buyer is obligated to take care of the disposal of the packaging at his/her own cost.

3. If the dispatch is delayed at the request of or due to a fault on the part of the buyer, we shall then store the goods at the buyer’s cost and risk. In this case, the announcement of readiness for dispatch shall be treated as equivalent to the dispatch.

4. Upon the request and at the cost of the buyer, we shall insure the delivery through a transport insurance policy.

5. We shall be entitled to make partial deliveries and render partial services at any time, provided that this is reasonable for the buyer.

VI. Acceptance

1. The buyer shall undertake to carry out all actions that require acceptance of our delivery. In the event of a culpable breach of this obligation by the buyer, he/she shall be liable to us for any additional expenses; in such cases, we shall also reserve the right to assert further compensation claims.

2. If the buyer's acceptance of the delivery is delayed by more than 14 days, we shall grant, in writing, a grace period of 14 days for the acceptance; at the same time, we shall issue a notification that acceptance will be rejected if this defined period expires without the action having been carried out. Should the buyer allow the defined grace period to elapse without the action having been carried out, we shall be entitled to withdraw from the purchase contract by means of a written declaration, or to demand compensation for non-performance. Should the buyer continue to refuse acceptance, or should he/she become aware that payment of the purchase price will not be possible even if a grace period is granted, there shall be no requirement to grant a grace period.

3. In such cases, we shall be entitled to claim the loss of profits we have suffered plus 10% of the agreed purchase price, unless the buyer proves that we incurred lower damages. Irrespective of this, we shall be entitled to prove and claim higher damages.

VII. Warranty

1. The buyer's claims due to defects only exist if the buyer has duly complied with his/her inspection and complaint obligations in accordance with Section 377 of the German Commercial Code (HGB). If the buyer makes changes to our products, fails to follow our operation, installation and maintenance specifications or does not follow them sufficiently, or uses parts or consumables that have not been approved by us, our warranty obligation shall no longer apply, unless the buyer can prove that the defect concerned is not the result of one of these circumstances. Otherwise, our installation instructions and guarantee conditions shall apply.

2. If there is a defect in the goods for which we are responsible, we shall undertake to effect subsequent performance – excluding the rights of the buyer to withdraw from the contract or to reduce the purchase price (reduction) – unless we are entitled to refuse to effect subsequent performance due to the statutory regulations.

The buyer must grant us a reasonable period of time for the subsequent performance. The subsequent performance may be effected either by removal of the defect (subsequent improvement) or by delivery of new goods. In the case of the removal of a defect, we shall bear the necessary costs provided that these do not increase because the goods of the contract are at a location other than the place of performance. At our reasonable discretion, we shall be entitled to determine the type of subsequent performance. Any subsequent performance by us shall take place without recognition of a legal obligation, unless the defect has been recognised by us.

If the subsequent performance fails, the buyer may, at his/her discretion, demand a reduction in the purchase price (reduction) or declare his/her withdrawal from the contract. The subsequent improvement shall be deemed to have failed after the second unsuccessful attempt, unless further attempts to achieve an improvement are appropriate and reasonable for the buyer in view of the nature of the contractual item.

Compensation claims according to statutory provisions due to a defect may only be asserted by the buyer if the supplementary performance fails.

The buyer shall not be entitled to demand compensation claims or a reduction in the purchase price in the case of insignificant defects.

3. The claims of the buyer due to defects in the purchased item shall lapse 5 years after delivery of the goods to the buyer if they were used for construction work in accordance with their normal method of utilisation and this has caused their defectiveness. This shall also apply to claims of the buyer for compensation or compensation instead of service, and due to all other damage to the buyer's rights arising from the defect; it shall not, however, apply to damage to the life, limb or health of the buyer, or to cases in which we are responsible for the defect as a result of wilful intent or gross negligence, including on the part of our vicarious agents.

VIII. Liability

1. In the case of wilful intent or gross negligence – including on the part of our representatives or vicarious agents – and in all cases of injury to life, limb or health, we shall be liable in accordance with statutory provisions. In cases of gross negligence, our liability shall be restricted to foreseeable damage that is typical for the contract, unless another of the exceptions listed in sentence 1 or sentence 3 of this paragraph 1 is present at the same time. Otherwise, we shall only be liable in accordance with the German Product Liability Act or as a result of a culpable breach of fundamental contractual obligations (cardinal obligations) or if we have fraudulently concealed the defect or assumed a guarantee for the properties of the purchased item. However, compensation claims for the breach of fundamental contractual obligations shall be restricted to foreseeable damage that is typical for the contract, unless another of the exceptions listed in sentence 1 or sentence 3 of this paragraph 1 is present at the same time.

2. The regulations of the previous paragraph 1 shall apply to all compensation claims (and particularly to compensation in addition to service and compensation instead of service), regardless of the legal basis, particularly when arising as a result of defects, a breach of obligations from the obligatory relationship, or tortious acts. They shall also apply to claims for compensation of wasted expenditure. However, liability for delivery delays shall be determined in accordance with Clause IV. of these Terms and Conditions of Sale and Delivery.

3. Any change to the burden of proof that is to the disadvantage of the buyer is not connected to the previous regulations.

IX. Retention of Title

1. The delivery item shall remain our property up to the point at which all our claims against the buyer arising from the business relationship have been satisfied.

2. The buyer shall be permitted to process or remodel the delivery item ("processing"). Processing shall be carried out for us. If, however, the value of the delivery item belonging to us is lower than the value of the goods not belonging to us and/or the processing, we shall acquire co-ownership of the new goods in the proportion that the value (gross invoice value) of the processed delivery item has to the value of the other processed goods and/or the processing at the time when the processing took place. If we do not acquire any ownership of the new goods in accordance with the preceding sentence, we and the buyer shall agree that the buyer shall grant us co-ownership of the new goods in the proportion that the value (gross invoice value) of the delivery item belonging to the buyer has to the other processed goods, at the point when processing took place. The previous sentence shall apply accordingly in the event that the delivery item is inseparably amalgamated or combined with goods not belonging to us. To the extent that we acquire ownership or co-ownership, we shall keep the goods safe for the buyer with the due care and diligence of a prudent businessman.

3. In the event that the delivery item or the new goods are sold, the buyer hereby assigns to us by way of security his/her claims arising from the resale against his/her customer, plus all ancillary rights, without the need for any additional special declarations. The assignment shall apply inclusive of any balance receivables. However, the assignment shall only apply to the amount that corresponds to the price of the delivery item invoiced by us. The share of the receivable assigned to us must be satisfied as a matter of priority.

4. If the buyer combines the delivery item or the new goods with property, he/she shall – without the need for any additional special declarations – also assign his/her receivables to which he/she is entitled as remuneration for the combination, at the amount that corresponds to the price of the delivery item invoiced by us.

5. Until further notice, the buyer shall be entitled to collect receivables assigned to us. The buyer shall immediately forward payments made towards the receivables assigned to us, up to the amount of the secured receivable. If there is a legitimate interest, and particularly in the case of default of payments, suspension of payments, opening of insolvency proceedings, protest of a bill, or substantiated evidence of overindebtedness or impending insolvency of the buyer, we shall be authorised to withdraw the buyer's right of collection. Additionally, following prior warning and with a reasonable deadline adhered to, we may disclose the security assignment, make use of the assigned receivables, and demand disclosure of the security assignment by the buyer to his/her customers.

6. If a justified interest is substantiated, the buyer must provide us with the information necessary to assert his/her rights in respect of his/her customers, and surrender the necessary documents.

7. For the duration that the retention of title is in place, the buyer shall be prohibited from pledging or assignment as security. In the event of seizure, confiscation or other official orders or acts of intervention by third parties, the buyer must notify us immediately. The resale of the delivery item or the new goods is only permitted for resellers in the ordinary course of business, and only under the condition that the proceeds from the delivery item are paid to the buyer. The buyer must also agree with the customer that the customer shall only acquire ownership once this payment is made.

8. If the realisable value of all security rights to which we are entitled exceeds the amount of the secured claims by more than 10%, we shall release a corresponding part of the security rights at the buyer's request. It shall be assumed that the conditions of the previous sentence have been met if the estimated value of the securities to which we are entitled reaches or exceeds 150% of the value of the secured claims. We shall be entitled to choose between the different security rights for release.

9. If the buyer breaches obligations – particularly in respect of default of payment – we shall be authorised, without setting a deadline, to demand surrender of the delivery item or the new goods and/or, with a deadline set if necessary, to withdraw from the contract. The buyer shall undertake to surrender possession. A demand for the surrender of the delivery item/new goods shall not constitute a declaration of withdrawal on our part, unless expressly stated.

X. Legal Venue, Choice of Law, Data Protection

1. Our registered office shall be the place of performance and jurisdiction for deliveries and payments (including actions due to cheques and bills of exchange) and all disputes arising between us and the buyer based on the purchase contracts concluded between us and the buyer. We shall also be entitled, however, to sue the buyer at his/her domicile and/or registered office.

2. The relations between the contracting parties shall be determined exclusively in accordance with the law of the Federal Republic of Germany. The application of international conventions concerning the sale of movable goods and the UN Convention on Contracts for the International Sale of Goods of 11.04.1980 (CISG) are excluded.

3. The execution of contracts concluded between us and the buyer shall take place in compliance with legal provisions such as the German Federal Data Protection Act (BDSG) and the German Telemedia Act (TMG). We shall undertake to work towards compliance with these regulations, including in respect of service providers commissioned by us and vicarious agents employed by us. In this context, we refer to the latest version of the data protection statement published on our homepage at www.hauff-technik.de/datenschutz.html.

4. The German version of the contents of our General Terms and Conditions of Sale and Delivery shall apply exclusively, even if there are versions in other languages.

Version: August 2014