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Terms and Conditions of Purchase of Otto Zimmermann, Maschinen- und Apparatebaugesellschaft mit beschränkter Haftung

1. General and scope

1.1 All orders, contracts concluded  and delivery call-offs of Otto Zimmermann, Maschinen- und Apparatebaugesellschaft mit beschränkter Haftung, hereinafter referred to as OZ, shall be made exclusively on the basis of the following Terms and Conditions of Purchase. OZ's Terms and Conditions of Purchase shall only apply vis-à-vis a legal entity under public law, a special fund under public law or an entrepreneur [hereinafter referred to as Contractor (CO)]. Entrepreneurs within the meaning of these terms and conditions are natural or legal persons or partnerships with legal capacity with whom a business relationship is entered into, who act in exercise of a commercial or independent professional activity (§ 14 BGB). OZ shall not recognize any terms and conditions of the contractual partner [hereinafter referred to as Contractor (CO)] that conflict with or deviate from these Terms and Conditions of Purchase, unless OZ has expressly agreed to their validity in writing. OZ's Terms and Conditions of Purchase shall also apply if OZ accepts the Contractor's delivery without reservation – while aware of the existence of terms and conditions of the Contractor conflicting with or deviating from OZ's Terms and Conditions of Purchase.

1.2 OZ's Terms and Conditions of Purchase shall also apply to all future transactions with the Contractor.

1.3 Legally relevant declarations and notifications by the Contractor with regard to the contract (e.g. setting of deadlines, reminders, withdrawal) shall be made in writing in text form (e.g. letter, e-mail, fax). The foregoing is without prejudice to formal legal requirements and OZ’s right to request further proof, in particular in case of doubts regarding the identification of the declaring party.

2. Offer and conclusion of contract

2.1 The Contractor is obliged to accept OZ's offers within a period of two weeks.

2.2 All agreements (in particular purchase orders, the conclusion of contracts and delivery call-offs) made between OZ and the Contractor for the purpose of executing this contract as well as any amendments and supplements thereto shall be recorded in writing in this contract. In addition, the relevant OZ execution guidelines, which can be viewed at OZ, and the OZ delivery regulations, to which reference may be made in the order, must be observed. Verbal agreements require the written confirmation of OZ to become effective. No verbal collateral agreements have been made.

2.3 All deliveries shall comply with the relevant state of the art, in particular the most recent DIN standards, as well as other standards customary in the industry or EU standards. Particular attention shall be paid to provisions governing safety engineering and occupational health and safety. The Contractor shall be responsible for ensuring that the delivery item, including presentation and labeling, complies with OZ's specifications. It shall ensure that it is familiar with the regulations with which there must be compliance in each case, shall be liable for any damage resulting from a failure to abide by such obligations and shall indemnify OZ against all third-party claims.

2.4 OZ reserves all property rights and copyrights to calculations, illustrations, drawings and other documents; they may not be made accessible to third parties without the express written consent of OZ. They are to be used exclusively for production on the basis of OZ's order. Following completion of the order they must returned to OZ without the need to be prompted to do so. They must be kept secret from third parties.

2.5 Cost estimates of the Contractor are binding and shall not be remunerated by OZ unless expressly agreed otherwise.

3. Prices and terms of payment

3.1 The price stated in the order is binding. Unless otherwise agreed in writing, the price shall be deemed to include delivery "free domicile" including packaging and customs.

3.2 The statutory value-added tax is included in the price.

3.3 Unless otherwise agreed in any individual case, the price shall include all services and ancillary services rendered by the Contractor (e.g. assembly, installation) and all ancillary costs (e.g. proper packaging, transport costs including any transport and liability insurance).

3.4 OZ can only process invoices if the order number stated in the order is indicated; the Contractor is responsible for all consequences arising from non-compliance with this obligation, unless it is able to prove that it is not responsible for them.

3.5 Invoices must always be submitted immediately after dispatch of the delivery item, stating the order number, in duplicate, separately for each delivery, to OZ in 74889 Sinsheim, Am Leitzelbach 8. They must neither be enclosed with the goods nor sent directly to the factory departments. Invoices which have not been properly compiled and are not verifiable will be returned to the Contractor unbooked.

3.6 Payment shall be made following receipt of the goods in accordance with the contract and receipt of a proper and verifiable invoice on the 25th day of the month following the month of delivery less 2% discount or net 60 days later. The method of payment shall be at the discretion of OZ. The payment date can only be met if the invoices are received by OZ by the 4th of the month following the delivery month. If this deadline is not met, the invoice will not be paid until the following month without affecting the right to deduct a discount.

3.7 OZ shall be entitled to exercise rights of set-off and retention and to invoke the defense of non-performance of the contract to the extent provided by law.

3.8 The Contractor shall only have a right of set-off or retention on the basis of counterclaims that have been legally established or are undisputed.

3.9 Upon payment of the purchase price, the contractual goods shall become the property of OZ.

3.10 Price escalation clauses, price reservation clauses or other cost clauses of the Contractor shall only be binding on OZ if they have been agreed upon separately.

4. Delivery time and delay

4.1 The delivery time stated in the order is binding. Unless otherwise agreed, the receipt of the complete consignment of goods by OZ shall be decisive for compliance with the delivery time.

4.2 The Contractor is obliged to inform OZ immediately in writing if circumstances occur or become apparent which indicate that the stipulated delivery time cannot be met.

4.3 In the event of a delay in delivery, OZ shall be entitled to assert statutory claims. In particular, OZ shall be entitled to claim damages in lieu of performance and to request rescission following the fruitless expiry of a reasonable period. If OZ claims damages, the Contractor shall be entitled to prove that it is not responsible for the breach of duty.

5. Delivery, performance, transfer of risk – delivery documents

5.1 In the absence of the prior written consent of OZ, the Contractor shall not be entitled to have the performance owed by it rendered by third parties (e.g. subcontractors). The Contractor shall bear the procurement risk for its services unless otherwise agreed in individual cases (e.g. limitation to stock).

5.2 Delivery shall be carried out "free domicile" within Germany to the place specified in the order. If the place of destination is not specified and nothing else has been agreed upon, the order shall be delivered to OZ's place of business. The place of destination in any given instance is also the place of performance for the delivery and that of any subsequent performance (obligation to deliver).

5.3 The delivery must be accompanied by a delivery note stating the date (issue and dispatch), the content of the delivery (article number and quantity) and OZ's order identifier (date and number). If the delivery note is missing or incomplete, OZ shall not be responsible for any resulting delays in processing and payment. Separately from the delivery note, a corresponding dispatch note with the same content must be sent to OZ.

5.4 The risk of the accidental loss and accidental deterioration of the item shall be transferred to OZ upon handover at the place of performance. Insofar as an acceptance has been agreed upon, this shall be decisive for the transfer of risk. In all other respects, the statutory provisions governing contracts for work and services shall also apply accordingly in the event of acceptance. The handover or acceptance shall be deemed to have taken place if OZ is in default of acceptance.

5.5 OZ shall not be obliged to accept partial or excess deliveries not expressly agreed upon. The same shall apply if goods are delivered to OZ before the agreed delivery date. Such pre-deliveries shall in particular not result in any change to the contractually agreed due dates for payments or those regulated in clause 3.6. OZ shall be entitled to return the goods at the expense and risk of the Contractor or to store them with third parties.

5.6 OZ's order number must also be quoted in all correspondence.

5.7 Trucks can only be unloaded at OZ's plants from Monday to Friday between 7:00 a.m. and 2:30 p.m. Other unloading times must be agreed with OZ in good time in advance. Trucks arriving at OZ outside this time window cannot expect clearance. OZ shall not bear any costs incurred in this respect for waiting times etc..

6. Defect inspection and liability for defects

6.1 The Contractor shall be obliged to subject the goods to a control system that ensures the intended quality and the intended use in accordance with statutory provisions and the contractual agreements.

6.2 Upon acceptance of the goods, OZ's incoming inspection shall be limited to ensuring that the delivery obviously corresponds to the information contained in the delivery notes (identity and quantity check) and that the goods do not have any obvious defects, subject to quality and final quantity checks. Obvious defects shall be notified immediately, at the latest 10 working days as calculated from the date of receipt of the goods, hidden defects within two weeks after their discovery. In this respect, the Contractor waives the objection of late notification of defects.

Notwithstanding section 442 (1), sentence 2 of the German Civil Code (BGB), OZ shall also be entitled without restriction to claims for defects if the defects remained unknown to OZ at the time of conclusion of the contract due to gross negligence.

6.3 OZ shall be entitled to assert statutory claims for defects without restriction. In any case, OZ shall be entitled to request from the Contractor, as it sees fit, the rectification of defects or the delivery of a new item. The rights of the Contractor under § 439, para. 4 BGB remain unaffected. The right to claim damages, in particular damages in lieu of performance, is expressly reserved.

6.4 Subsequent performance shall also include the removal of the defective goods and their re-installation, insofar that the goods have been installed in another item or attached to another item in accordance with their type and intended use; OZ's statutory claim to reimbursement of corresponding expenses shall remain unaffected. The Contractor shall bear the expenses required for the purpose of inspection and subsequent performance even if it turns out that there was actually no defect. OZ's liability for damages in the event of an unjustified request for rectification of defects shall remain unaffected; in this respect, however, OZ shall only be liable if OZ recognized or was grossly negligent in not recognizing that there was no defect.

6.5 OZ shall be entitled to remedy the defect itself or have it remedied by a third party at the Contractor's expense in the event of imminent danger and if it is no longer possible to inform the Contractor of the imminent danger due to the particular urgency of the situation and to set a short deadline for the remedy of the defect that is reasonable given the situation. The rights under section 439 (4) of the German Civil Code (BGB) shall remain unaffected.

6.6 The Contractor may not make the fulfillment of justified claims for rectification of defects dependent on OZ rendering the agreed counter-performance in full. However, OZ may not retain any amount that is disproportionate in relation to the defect due to be remedied.

6.7 If OZ incurs costs as a result of the defective delivery of the goods, in particular transport, travel, labor and material costs or costs for an incoming goods inspection exceeding the usual scope, the Contractor shall bear these costs. OZ shall be entitled to demand reimbursement from the Contractor of the expenses which OZ had has to bear in relation to vis-à-vis its customer because in relation to the fact that the latter has asserts a claim against OZ for reimbursement of the expenses necessary required for the purpose of subsequent performance, in particular transport, travel, labor and material costs.

7. Statute of limitations

7.1 The limitation period for material defects shall be three years from the date of transfer of risk. The limitation period pursuant to sentence 1 shall be extended accordingly insofar as the law pursuant to §§ 438, para. 1, no. 2, 634a, para. 1, no. 2 BGB and §§ 445a, 445b BGB provides for longer limitation periods; likewise in the case of claims arising from a guarantee or due to injury to life, limb, health or due to a grossly negligent or intentional breach of duty and in the case of the fraudulent concealment of a defect. The provisions on the suspension of the expiry, suspension and recommencement of the limitation periods in accordance with statutory provisions shall remain unaffected by this.

Insofar as acceptance has been agreed upon, the limitation period shall commence upon acceptance. The 3-year limitation period shall also apply accordingly to claims arising from defects of title, in respect of which the statutory limitation period for claims in rem for surrender by third parties (section 438 (1), no. 1 BGB) shall remain unaffected. Claims arising from defects of title shall furthermore not become time-barred in any case as long as the third party is still able to assert the right – in particular in the absence of a limitation period - against OZ.

7.2 The limitation periods of the law on sales including the above extension shall apply – to the extent permitted by law - to all contractual claims for defects. Insofar as OZ is also entitled to non-contractual claims for damages due to a defect, the regular statutory limitation period shall apply (§§ 195, 199 BGB), unless the application of the limitation periods of the law on sales leads to a longer limitation period in individual cases.

8. Product liability and indemnification

8.1 Insofar as the Contractor is responsible for product damage, it shall be obliged to indemnify OZ against claims for damages by third parties upon first request to the extent that the cause lies within its sphere of control and organization and it is liable itself in relation to third parties.

8.2 Within the scope of its liability for cases of damage within the meaning of clause 8.1, the Contractor shall also be obliged to reimburse any expenses pursuant to §§ 683, 670 BGB (German Civil Code) as well as pursuant to §§ 830, 840, 426 BGB (German Civil Code) arising from or in connection with a recall action carried out by OZ. OZ shall inform the Contractor about the content and scope of the recall measures to be carried out – as far as possible and reasonable – and afford it the opportunity to comment. Other legal claims remain unaffected.

8.3 The Contractor undertakes to take out and maintain a product liability insurance with a lump sum coverage of € 10 million per instance of personal injury/property damage. If OZ is entitled to further claims for damages, these shall remain unaffected.

9. Proprietary rights

9.1 The Contractor warrants that its delivery does not infringe any rights of third parties within the Federal Republic of Germany.

9.2 If a claim is made against OZ by a third party for this reason, the Contractor shall be obliged to indemnify OZ against these claims upon first written request if the Contractor is responsible for the defect of title within the meaning of § 276 BGB. OZ is not entitled to make any agreements with the third party without the consent of the Contractor, in particular to conclude a settlement.

9.3 The Contractor's indemnification obligation relates to all expenses necessarily incurred by OZ as a result of or in connection with a claim by a third party.

9.4 The limitation period is 36 months, calculated from the date of conclusion of the contract.

10. Retention of title, provision and confidentiality

10.1 If OZ provides goods to the Contractor, OZ shall retain title thereto. Processing or transformation by the Contractor shall be carried out on behalf of OZ. If the goods subject to retention of title are processed by OZ with other items not belonging to OZ, OZ shall acquire co-ownership of the new item in proportion to the value of the item belonging to OZ (purchase price plus VAT) with respect to the other processed items at the time of processing.

10.2 If the goods supplied by OZ are inseparably mixed with other objects not belonging to OZ, OZ shall acquire co-ownership of the new object in proportion to the value of the reserved goods (purchase price plus VAT) to the other mixed objects at the time of mixing. If the mixing takes place in such a way that the Contractor's item must be regarded as the main item, it is hereby agreed that the Contractor will transfer co-ownership to OZ on a pro-rata basis; the Contractor shall safeguard the sole ownership or co-ownership rights on behalf of OZ.

10.3 OZ retains ownership of tools. The Contractor is obliged to use the tools exclusively for the production of the goods ordered by OZ. The Contractor is obliged to insure the tools belonging to OZ at their replacement value against fire, water and theft damage at his own expense. At the same time, the Contractor hereby assigns to OZ all claims for compensation arising under this insurance; OZ hereby accepts the assignment. The Contractor is obliged to carry out any necessary maintenance and inspection work on OZ's tools as well as all maintenance and repair work at his own expense and in good time. It must notify OZ immediately of any malfunctions; if it culpably fails to do so, claims for damages shall remain unaffected.

10.4 The Contractor is obliged to keep all calculations, illustrations, drawings and other documents and information strictly secret. They may only be disclosed to third parties with the express consent of OZ. The obligation to maintain secrecy shall also apply after the execution of this contract; it shall expire if and to the extent that the manufacturing knowledge contained in the illustrations, drawings, calculations and other documents provided has become generally known.

11. Final provisions

11.1 If the Contractor is a registered merchant within the meaning of the German Commercial Code, a legal entity under public law or a special fund under public law, the place of jurisdiction shall be Sinsheim. However, OZ shall also be entitled to sue the Contractor at its place of business.

11.2 Unless otherwise stated in the order, the place of performance shall be OZ's place of business in Sinsheim if the Contractor is a registered merchant, a legal entity under public law or a special fund under public law.

11.3 OZ shall be entitled to store and process contractual data relating to the Contractor within the scope of the order in accordance with the provisions of the Data Protection Act.

11.4 The contractual relations shall be governed exclusively by German law. Provisions on the conflict of laws and the United Nations Convention on Contracts for the International Sale of Goods are excluded. The contractual language is German.

Last amended: May 2020