General Purchase Conditions of
Kurz Elektronik GmbH

as at August - 2016 -

Sec. 1 Application

(1) These Purchase Conditions apply to all business transactions between KURZ and the supplier, even if
they are not referred to in subsequent contracts. Terms and conditions of the supplier that conflict with,
supplement, or deviate from these Purchase Conditions shall not become part of the contract unless their
application is expressly approved by KURZ in writing. These Purchase Conditions apply even if KURZ
accepts a delivery from the supplier without reservations while being aware of the supplier’s conflicting
or deviating terms and conditions.

(2) Agreements which supplement or deviate from these Purchase Conditions and which are made between
the supplier and KURZ for the performance of a contract must be set forth in writing in the contract. This
also applies to the cancellation of this requirement of the written form.

(3) Rights beyond those provided for in these Purchase Conditions to which KURZ is entitled according to
law remain unaffected.

Sec. 2 Formation of Contract and Amendments


(1) Unless otherwise agreed in writing, all the supplier’s offers and cost estimates shall be made at no cost to
KURZ.


(2) Purchase orders, as well as changes or additions to purchase orders, and other agreements made at the
conclusion of the contract do not become binding until made by KURZ in writing or – if purchase orders
are placed orally, by telephone, or using other means of telecommunication – until duly confirmed in
writing. Purchase orders which have been generated using automatic devices and, therefore, contain no
signature and name shall be deemed written purchase orders. Silence on the part of KURZ following
quotes, requests, or other declarations of the supplier shall be deemed consent only where this has been
expressly agreed upon in writing. If and to the extent that a purchase order contains obvious errors, misspellings,
or calculation mistakes, it shall not be binding upon KURZ.


(3) If the goods ordered are subject to export control or other restrictions on marketability pursuant to the
regulations applicable in the Federal Republic of Germany, the supplier must so advise KURZ in writing
before the contract is entered into. Otherwise, KURZ may withdraw from the contract without setting a
deadline for the performance of the obligation to inform if and when such goods are delivered, irrespective
of whether there was fault on the part of the supplier and without further claims on the part of KURZ
being excluded.

(4) The supplier shall, without undue delay and in any case no later than three working days after the receipt
of the purchase order, issue an order confirmation in which the price and the delivery date are expressly
stated. If the order confirmation deviates from the purchase order, the deviations will only be deemed
agreed upon if and when they are expressly confirmed by KURZ in writing. The same applies to subsequent
changes to the contract. If KURZ and the supplier have entered into a framework agreement concerning
future deliveries, purchase orders issued by KURZ shall be binding if not objected to by the supplier
within three working days after they have been received.

(5) If it turns out during the performance of a contract that deviating from the originally agreed specifications
is necessary or advisable, the supplier shall so advise KURZ without undue delay. KURZ will inform the
supplier without undue delay of whether it wishes the supplier to make changes to the original purchase
order and, if so, what changes. If, as a result of such changes, there is a change in the costs incurred by
the supplier in performing the contract, both KURZ and the supplier shall have the right to demand an
appropriate adjustment of the agreed prices.


Sec. 3 Delivery


(1) The delivery must correspond to the purchase order in terms of execution, scope, and scheduling. The
agreed-upon delivery periods and delivery dates are binding. Delivery periods commence on the day the
purchase order is issued. The goods must be received at the delivery address indicated by KURZ within
the delivery period.

(2) If it becomes clear to the supplier that the delivery period cannot be met, the supplier shall so advise
KURZ without undue delay in writing, also stating the reasons for and the expected duration of the delay.
In the event of a delay in delivery, KURZ will be entitled to withdraw from the contract, irrespective of
whether or not there was any negligence or willful misconduct on the part of the supplier. In the event of
default of the supplier, KURZ may demand liquidated damages in an amount equal to 0.5% of the net order
value for each commenced week of delay, but no more than 5% of the net order value in total. This
does not affect any further claims of KURZ. The claim of KURZ for delivery shall not be excluded until
the supplier pays damages in lieu of the delivery at the request of KURZ. Acceptance of the late delivery
does not constitute a waiver of claims for damages.

(3) Delivery before the agreed delivery date is only permissible with the prior written consent of KURZ.
KURZ may return any goods delivered early or store them at the supplier’s expense until the agreed delivery
date.

(4) Unless otherwise agreed, partial deliveries and deliveries of larger or smaller quantities are not permitted.
KURZ reserves the right to recognize such deliveries in individual cases.

Sec. 4 Passing of Risk and Shipment

(1) The supplier bears the risk of accidental loss or destruction or accidental deterioration of the goods until
their acceptance by KURZ. If the supplier is obligated to carry out the set-up or assembly of the goods in
the business premises of KURZ, the risk will not pass to KURZ until after the goods have been put into
operation.


(2) Every shipment must be accompanied by packing slips or delivery notes stating the contents and the
complete order identifications. Notice of dispatch shall be given immediately, stating the same information.

(3) The supplier must observe the rules stipulated by KURZ for the shipment of goods. The goods must be
packed in such a manner as to prevent damage in transit. Packaging materials may only be used to the
extent required for this purpose. Only environmentally friendly, recyclable packaging materials may be
used. As compensation for the incurred costs of disposal, the supplier shall, at the end of each calendar
quarter, pay a lump sum of 0.3% of the net order value of the calendar quarter. The use of reusable packaging
is only permitted with the prior written consent of KURZ.


Sec. 5 Prices and Payment

(1) The price stated in the purchase order is binding. Unless otherwise agreed upon in writing, the price includes
the cost of packaging and transport up to the delivery address indicated by KURZ. Statutory value-
added tax is included in the price unless the price has been expressly stated to be a net price.

(2) The supplier’s invoices must state the order identifications and the number of every single item. Otherwise,
the invoices cannot be processed and, therefore, will be deemed not received. Copies of invoices
shall be identified as duplicates.

(3) Payment will be made upon acceptance of the goods and receipt of the invoice by the 15th day of the
month which follows the acceptance of the goods with a 3% discount or within 90 days net. Payment will
be made subject to review of the invoice. If a shipment is defective, KURZ may withhold payment until
proper performance by the supplier without forfeiting its right to rebates, discounts, or similar price reductions.
To the extent that the customer is obligated to supply materials tests, inspection reports, quality
documents, or other documents, the receipt of these documents will be a further prerequisite for the acceptance
of the goods. The time allowed for payment shall not commence until all defects have been fully
remedied. If goods are delivered early, the time allowed for payment shall not commence until the
agreed delivery date. In the event of default of payment, the supplier may claim default interest at a rate
of 2% above the basic interest rate, due regard being had to the current interest situation, unless KURZ
proves that the damage actually sustained by the supplier remains below this amount. The supplier may
withdraw from the contract if, after KURZ has defaulted on its obligation to pay, the supplier has set a
reasonable additional period of time for payment and this additional period of time has expired without
payment by KURZ.

(4) Ownership of the goods will be transferred to KURZ free of any encumbrances when the goods are paid
for, at the latest. Payments will only be made to the supplier. Counterclaims of the supplier may be set
off by the supplier only if they have been finally established by declaratory judgment or otherwise or if
they are undisputed. The customer may assert a right to retain only if its counterclaim is based on the
same contract.


Sec. 6 Guarantees and Claims for Defects


(1) The supplier guarantees that the goods supplied correspond to the latest state of the technology and that
they comply with all applicable legal provisions and with the regulations and guidelines issued by the authorities,
employers’ liability insurance associations, and professional associations. The supplier must inform
KURZ without undue delay in writing if the supplier has any concerns about the purchase order being
performed as desired by KURZ.

(2) To the extent feasible in the ordinary course of business, KURZ shall examine without undue delay after
taking delivery of the goods whether quantity and type of the goods received correspond to the purchase
order, as well as whether there is any visible external damage sustained in transit.

(3) If a defect is discovered during such examinations or at a later point in time, KURZ shall so advise the
supplier within two weeks of the examination or of the discovery of the defect.

(4) The approval of drawings, calculations, or other technical documents of the supplier by KURZ will not
affect the supplier’s responsibility for defects or the supplier’s liability under any guarantee it has given.

(5) If the goods contain defects, KURZ may, without prejudice to its statutory claims for defects, demand
subsequent performance through the removal of the defects by the supplier or, at the option of KURZ,
through the delivery of goods which are free from defects. The supplier shall bear all necessary expenses
for subsequent performance. If subsequent performance does not occur within a reasonable period of
time, if it fails, or if setting a deadline can be dispensed with, KURZ may withdraw from the contract or
reduce the purchase price and claim damages in lieu of performance or reimbursement of the expenses
made to no avail in accordance with the statutory provisions. If KURZ has claims under guarantees and
these claims go beyond the statutory rights available in case of defects, such claims shall remain unaffected.

(6) If, without having a right to refuse subsequent performance, the supplier fails to perform its obligation to
subsequently perform within a reasonable period of time set by KURZ, KURZ may additionally carry out
the necessary measures itself, or have them carried out by a third party, at the expense and risk of the
supplier. In cases where notifying the supplier of the defect and the impending damage and setting an –
even short – period of time for remedial action are impossible because of particular urgency and/or because
an unreasonably high damage – as compared to the warranty obligation – is to be expected in the
absence of remedial action, KURZ may take the necessary measure immediately without first consulting
with the supplier. KURZ shall always have the right to remedy minor defects, or have them remedied by
a third party, at the supplier’s expense without consultation of the supplier if the cost of the remedial action
amounts to up to 10% of the net order value of the defective goods.

(7) Taking delivery of goods or processing, paying for, or issuing subsequent orders for goods which have
not yet been discovered to be defective and the defects of which have not, therefore, been reported yet
does not constitute approval of the delivery or a waiver of claims for defects by KURZ.

(8) The limitation period for claims of KURZ for defects is 24 months, except where a longer limitation period
is prescribed by Sec. 438 (1) and (3) German Civil Code. If KURZ purchases the goods for resale,
the limitation period shall commence at the point in time at which the limitation period applicable to the
resale of the goods commences, but not later than twelve months after the goods have been accepted by
KURZ. The same applies if KURZ purchases the goods for further processing. If the supplier carries out
repairs or makes a replacement delivery, the limitation period shall commence anew.

(9) Suppliers of goods for which replacement parts are required will be obligated to supply KURZ upon expiry
of the limitation period for another ten years with the required replacement parts, accessories, and
tools.


Sec. 7 Product Liability


(1) The supplier is obligated to indemnify and hold KURZ harmless from and against any and all third-party
claims under German or foreign product liability law which are based on a defect of the product delivered
by the supplier if and to the extent that the supplier is responsible for the product defect and the damage
suffered pursuant to the principles of product liability law. This does not affect any further claims of
KURZ.

(2) On the same conditions as set forth in Sec. 7 (1) above, the supplier must additionally reimburse KURZ
for any expenses which KURZ incurs as a result of or in connection with any precautionary measures – in
particular, product warnings, an exchange of products, or product recalls – taken by KURZ to avoid being
held liable under product liability law. Where possible and reasonable, KURZ will advise the supplier of
the contents and scope of the measures to be taken and give the supplier the opportunity to comment
thereon.

(3) The supplier must appropriately insure against all risks arising from product liability, including the risk of
product recalls, and will present the insurance policy to KURZ as evidence, if so requested.

Sec. 8 Third-Party Property Rights

(1) The supplier guarantees that the delivery and the use of the goods do not infringe any patents, licenses, or
other third-party property rights.

(2) If, due to the delivery und use of the goods, KURZ or any customers of KURZ are held liable by a third
party for infringement of any such rights, the supplier will be obligated to indemnify and hold KURZ or
the customers of KURZ harmless from and against these claims. This indemnification duty applies to any
and all expenses which are incurred in connection with KURZ or the customers of KURZ being held liable.
At the supplier’s expense, KURZ may, in particular, obtain the permission from the third party to
use the goods.


Sec. 9 Force Majeure


(1) If KURZ is prevented from performing its contractual obligations – in particular, from taking delivery of
the goods – due to an event of force majeure, KURZ will be released from its obligation to perform for
the duration of the impediment and a reasonable start-up period without being liable to the supplier for
damages. The same applies if the performance of its obligations by KURZ becomes unreasonably complicated
or temporarily impossible because of unforeseeable circumstances for which KURZ is not responsible,
in particular, because of industrial action, official acts, energy shortage, or major disruptions of
operations.

(2) KURZ may withdraw from the contract if such an impediment lasts more than four months and if, as a
result of such impediment, the performance of the contract is no longer of interest to KURZ. At the request
of the supplier, KURZ will declare after the expiry of the aforesaid four-month period whether it
will make use of its right to withdraw from the contract or whether it will take delivery of the goods within
a reasonable period of time.

Sec. 10 Provision of Items by KURZ

(1) KURZ retains title to all samples, models, drawings, artworks, tools, and other items which KURZ provides
to the supplier for the manufacture of the goods ordered or for any other purpose. The supplier is
obligated to use these items exclusively for the manufacture of the goods ordered or as otherwise specified
by KURZ. The items may not be made available to a third party. The supplier must return the items
to KURZ unasked and without undue delay at its own expense if they are no longer needed.

(2) Any processing or transformation by the supplier of the items provided will be made on behalf of KURZ.
If such items are processed together with other items not owned by KURZ, KURZ will acquire a coownership
interest in the new item which corresponds to the ratio of the value of the item provided by
KURZ to the value of the other processed items at the time of processing.

(3) The supplier is obligated to handle and store all items provided with due care. The supplier must insure
the items provided at its own expense at replacement value against damage by fire, water, and theft. The
supplier hereby assigns to KURZ all claims for compensation arising from such insurance. KURZ hereby
accepts the assignment. The supplier is obligated to carry out all necessary maintenance and inspection
work and all servicing and repair work with respect to the items provided in a timely manner at its own
expense. The supplier must advise KURZ without undue delay of any damage.

(4) Goods which the supplier manufactures in whole or in part according to the specifications given by
KURZ, or using the items provided by KURZ, may be used by the supplier itself, or be offered, supplied,
or otherwise made available to a third party, only with the prior written consent of KURZ. This also applies
to goods which KURZ has legitimately refused to accept from the supplier. The supplier must pay
KURZ liquidated damages in the amount of €25,000.00 for each and any violation of these provisions.
This does not affect any further claims of KURZ.

Sec. 11 Confidentiality
The supplier is obligated, for an unlimited period of time, to maintain the confidentiality of any and all information
received through KURZ which is stated to be confidential or which can be identified as a trade
or business secret according to other circumstances; the supplier may neither record nor disclose or use
any such information unless such recording, disclosure, or use is required for the delivery to be made to
KURZ. The supplier must ensure by means of suitable contractual agreements with the employees and
agents working on its behalf that these persons, too, refrain for an unlimited period of time from any use,
disclosure, and unauthorized recording of such trade and business secrets for their own purposes.

Sec. 12 Liability

KURZ will be liable without limitation for any damage resulting from breach of guarantee or from death,
bodily injury, or damage to health. The same applies to damage arising from willful misconduct or gross
negligence. In cases of slight negligence, KURZ will only be liable if material obligations that result
from the nature of the contract and the performance of which is of particular importance in order for the
purpose of the contract to be achieved are breached. If such obligations are breached, as well as in the
event of default or if performance is impossible, the liability of KURZ will be limited to the damage the
occurrence of which can typically be expected within the framework of the contract. This does not affect
mandatory statutory liability for product defects.

Sec. 13 Final Provisions

(1) The supplier is not authorized to have any purchase order, or material parts of a purchase order, carried
out by a third party unless the supplier has obtained the prior written consent of KURZ.

(2) Rights and obligations of the supplier may only be assigned or transferred to a third party with the written
consent of KURZ.

(3) The legal relations between the supplier and KURZ shall be governed by the laws of the Federal Republic
of Germany, without regard to the United Nations Convention on Contracts for the International Sale of
Goods (CISG).

(4) The exclusive place of jurisdiction for all disputes arising from the business relationship between KURZ
and the supplier shall be the seat of KURZ. KURZ may additionally sue the supplier at the supplier’s
seat, as well as at any other permissible place of jurisdiction.

(5) The contractual language shall be German.

(6) The place of performance for any and all obligations to be performed by the supplier and by KURZ shall
be the seat of KURZ.

(7) Should any provision of this agreement be or become invalid or impracticable in whole or in part, or
should this agreement be incomplete, this shall not affect the validity of the remaining provisions hereof.
In lieu of the invalid or impracticable provision, such valid and practicable provision shall be deemed
agreed upon as comes closest to the purpose of the invalid or impracticable provision. In the event that
this agreement is incomplete, such provision shall be deemed agreed upon as corresponds to what would
have been agreed upon according to the purpose of this agreement if the contracting parties had considered the matter from the outset.

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  • Kurz Elektronik GmbH
    Industriestraße 20
    D-75382 Althengstett
    Germany

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