SURFACE TECHNOLOGY, FINISHING, PLANT CONSTRUCTION & PROCESS CHEMICALS

General Terms of Trade

Poligrat Deutschland GmbH and Gustav Morsch GmbH 
(named in these Terms as “POLIGRAT”)

1. Validity of the following Terms of Trade

1.1. These General Terms of Trade apply exclusively to contracts that POLIGRAT concludes with an enterprise, a legal entity under public law or a public law special trust.
1.2.These Terms of Trade form the exclusive basis for the offers and services supplied by POLIGRAT, they also apply to all future supplements, addendums and modifications to contracts already concluded and to all contracts concluded in the future. The customer’s General Terms of Trade which contradict those of POLIGRAT are hereby expressly rejected. No deviations to these Terms of Trade are ceded, insofar as nothing is agreed to the contrary in writing.
1.3.Contracts concerning industrial plant, or components of such, to be supplied by POLIGRAT are additionally subject to the conditions applied by POLIGRAT concerning the supply of industrial plant. These are a supplement to these General Terms of Trade and, in case of contradictory regulations, have priority over these General Terms of Trade.

2. Offers, conclusion of contract and written form

2.1. Cost estimates and other documents, such as plans and details of treatment, design and technical processes, which are submitted by POLIGRAT with an offer are non-binding, unless these are expressly designated as being binding. POLIGRAT’s offers are without obligation. Contracts do not enter force until POLIGRAT issues a written confirmation of order. Even if work pieces are taken in for processing, are received in a comparable manner or we maintain silence, this is no justification for the customer to believe that a contract has been concluded. POLIGRAT can issue a written confirmation of order up to 14 calendar days after receiving the customer’s order, unless the customer expressly insists upon a shorter
period.

2.2. All agreements require the written form. Verbal agreements require written confirmation from POLIGRAT to be legally effective. The same applies to a waiver of the requirement of written form. POLIGRAT’s employees are not authorised to waive the requirement of written form, to give assurances which deviate from the confirmation of order nor to pledge guarantees. Neither a name signed in own hand nor an electronic signature is required for the written form. Notices sent by fax or e-Mail satisfy the written form.

3. Provision of performance, dates, partial performance and official approval

3.1. The dates and deadlines quoted by POLIGRAT are non-binding, insofar as nothing is expressly agreed to the contrary in writing. If binding delivery deadlines are agreed in writing, these start from the date that POLIGRAT issues the confirmation of order, although not before materials, documents, official approvals, releases etc. to be supplied by the customer have been provided, nor until any down-payment agreed has been received.

3.2. POLIGRAT is not responsible for delays in performance, even if binding dates and deadlines have been agreed, if such are due to an Act of God, such as accidents, traffic jams, delayed flights, difficulties in obtaining materials, operational breakdowns, industrial disputes, official intervention etc., likewise if these occur at suppliers and contractors of POLIGRAT or at their sub-suppliers or contractors, provided this could not be foreseen and/or avoided by POLIGRAT in good time. Acts of God entitle POLIGRAT to postpone performance for the duration of the hindrance plus any start-up time required or, in case performance has become impossible or unreasonable, to withdraw from the unfulfilled part of the contract in part or in full. The same applies if the customer’s financial situation deteriorates considerably.

3.3. POLIGRAT may make partial deliveries of goods or services and invoice these separately. This does not apply if the customer has no interest in partial performance or if this is unreasonable for the customer for other reasons.

4. Prices, maturity, offsetting and retention

4.1. The prices quoted by POLIGRAT do not include value-added tax, this will be added at the prevailing rate.

4.2. Any fixed prices agreed apply to those POLIGRAT services detailed in the confirmation of order. POLIGRAT shall be remunerated for any additional or extra services that are agreed or necessary in accordance with its normal hourly rates.

4.3. Providing the contract does not regulate otherwise, POLIGRAT’s prices are ex POLIGRAT works, including loading in the works, although excluding packaging, shipment and other transport costs.

4.4. If the customer cancels a contract for a reason which POLIGRAT is responsible, POLIGRAT then only has a claim to remuneration for the services performed up to the point of termination. The claim to remuneration lapses if the services performed are demonstrably without any value at all for the customer because of the cancellation. In all other cases in which the contract is terminated by the customer or by POLIGRAT, POLIGRAT retains its claim to the contractual remuneration, although under deduction of expenses saved and under deduction of the amounts which POLIGRAT earns through another use of its performance, or which it culpably neglects to earn. Providing the customer does not demonstrate a higher proportion or POLIGRAT a lower proportion of expenses saved and/or other possible earnings in a particular case, the proportion to be deducted from the remuneration is agreed at 40 % of the remuneration with regard to the services still outstanding. Services already performed shall be remunerated to the full extent.

4.5. POLIGRAT’s invoices, including invoices for instalment payments, are payable immediately upon receipt of the invoice without deduction. The customer is not entitled to withhold payments, nor to offset any counter-claims unless the rights of withholding and/or the counter-claims are undisputed or have been established under law. Acceptance of cheques or bills of exchange does not represent fulfilment of the claim.

5. Reservation of ownership

5.1. In the case of contracts under which POLIGRAT is obliged to transfer possession of an object, POLIGRAT reserves the ownership to all services it performs until complete payment has been made of all claims arising from the contract on which these are based, and all claims against the customer which exist from the business relationship. Should the customer be in default of payment, POLIGRAT is then entitled to take back work and services to which POLIGRAT has reserved ownership (in future reserved performance). This does not represent a withdrawal from contract unless POLIGRAT expressly declares so in writing.

5.2. When a reserved performance is reprocessed or converted, this is always done on behalf of POLIGRAT as the manufacturer, although without any obligation for POLIGRAT. This means that POLIGRAT becomes the owner or co-owner of the newly manufactured, uniform object in the ratio of the value of the reserved performance to that of the overall work of the newly manufactured object. The (co-)ownership acquired by POLIGRAT under this manufacturer agreement is likewise referred to below as reserved performance.

5.3. The customer shall safeguard the performance reserved by POLIGRAT for this company at no charge. It is obliged to handle the reserved performance with care and properly secure, store and insure it against theft, damage and destruction at its own expense and, on request from POLIGRAT, to store it apart or suitably demarcate it at own expense, and to take all action required to comprehensively safeguard the reserved performance. For the purpose of security, the customer hereby assigns claims which arise against the insurer in the full extent and irrevocably to POLIGRAT. POLIGRAT accepts the assignment.

5.4. If a third party makes an attachment to the reserved performance, particularly in case of a seizure, the customer shall refer to the ownership of POLIGRAT and notify POLIGRAT without delay in writing.

5.5. The customer is entitled to resell the reserved performance in an orderly business transaction. It even now assigns to POLIGRAT all claims due to it against its customer or third parties from the resale to the value of the reserved performance. POLIGRAT accepts the assignment. The customer nevertheless retains the right to collect the claim assigned to POLIGRAT for its own account and in own name. This authority is revocable if the customer is in default. In case the authority to collect is revoked, the customer is obliged to notify POLIGRAT of the assigned claims and their debtors, to provide all details required to collect the claims and submit all associated documents.

5.6. In case of a withdrawal from contract, in particular because the customer is in default of payment, POLIGRAT is entitled to resell the reserved performance on the open market and satisfy itself from the receipts. Regardless of other rights due to POLIGRAT, the customer is obliged to recompense POLIGRAT for the expenses it occurs in concluding the contract, in processing the contract to date and in dissolving the contract, including the costs of recover.

5.7. At the customer’s request, POLIGRAT is obliged to release the securities due to it if the estimated value of these securities, including the securities as per item 6, exceed POLIGRAT’s claims to be secured by more than 30 %. The securities to be released are selected at the discretion of POLIGRAT.

6. Factory artisan’s lien and collateral assignment

6.1. When objects are handed over to POLIGRAT for processing, a factory artisan’s lien is commissioned for POLIGRAT upon handover of the object to secure all claims arising from the contract on which the work is based and all claims already existing from the business relationship with the customer. If the customer is in default, POLIGRAT can then, after issuing a warning notice of sale, sell on the open market such a quantity of the objects in its possession as is necessary to satisfy the debt accordingly to its diligent judgement.

6.2. If POLIGRAT hands the objects over to the customer before all of POLIGRAT’s claims have been settled in full, the customer even now assigns the ownership of these objects to POLIGRAT to the value of the claims to be secured as per item 6.1.. POLIGRAT accepts the collateral assignment. The surrender of possession is compensated by means of the customer safekeeping the objects for POLIGRAT at no charge in consideration of the following regulations. If the customer only has a contingent right to the work pieces, the transfer of the contingent right then substitutes the transfer of ownership. The customer even now grants POLIGRAT the right to let its own reservation of ownership lapse to satisfy the owner. Should the objects and rights to be pledged as security as per item (?) already have been collaterally assigned to a third party, the customer hereby assigns its claims to release, retransfer of ownership and the issue of the objects to POLIGRAT. POLIGRAT accepts the assignment. The objects or rights assigned or pledged as security are designated as reserved performance. The regulations under items 5.2. to 5.7. apply to these accordingly.

7. Transfer of risk and fulfilment
Insofar as the contract does not urgently stipulate an obligation to be performed at creditor’s domicile, the risk of the accidental loss or the accidental deterioration of the performance or partial performance to be delivered by POLIGRAT is transferred to the customer upon their dispatch, even if POLIGRAT has assumed the costs of dispatch and transport or the shipment is made using POLIGRAT’s own vehicles. No transport insurance shall be arranged for the goods to be dispatched by POLIGRAT unless this is expressly requested in writing and paid for by the customer. Dispatched goods shall be taken in by the customer, even if defects are apparent, although this without prejudice to the customer’s warranty rights.

8. Warranty
The warranty given by POLIGRAT is determined by legal provisions in consideration of the following regulations:

8.1. POLIGRAT’s customer does not receive a guarantee in the legal sense. In particular, keyword designations, references to generally recognised (DIN) standards, the use of trademarks or quality labels, the submission of samples or specimens etc. alone do not constitute furnishment of a guarantee or assurance. POLIGRAT accepts no liability for a false use of the supplied product, in particular not for a use contrary to that stipulated in the instructions for use. Once a period of storage or application (best before date) stipulated for the supplied product has expired, all warranties for using the product expire after this date. If chemicals are supplied, a warranty is only given for the faultless condition of the product and not for chemical reactions which occur during their use.

8.2. The customer shall inspect each single delivery without delay and in every respect for recognisable and typical non-conformities in quality, quantity or those of another nature. Goods and services are regarded as approved if they are accepted without complaint. Installation or other uses of the delivery are regarded as acceptance. Complaints of defects must be notified directly to POLIGRAT without delay, in writing, stating the precise nature and scope of the alleged defects.

8.3. In case goods or services are defective, POLIGRAT initially meets its warranty obligations through rework, new manufacture or a replacement delivery at POLIGRAT’s discretion. Should POLIGRAT wholeheartedly and conclusively refuse fulfilment or to rectify the defect, or if subsequent fulfilment fails or is unreasonable for the customer, the customer can then, at its discretion, solely choose between a discount in the remuneration (reduction) or rescission of the contract (withdrawal) and demand damages instead of performance only within the framework of the limitations of liability as per item 9.. The customer has no right of withdrawal if the infringement of contract is solely of a minor nature, in particular for solely minor defects.

8.4. If, after subsequent fulfilment has failed, the customer chooses to withdraw from the contract on account of a legal or material defect, it has no further claims to damages on account of the defect. If, after subsequent fulfilment has failed, the customer chooses to pursue damages, the defective goods or services remain with the customer, unless this is unreasonable for the customer. The claim to damages in this case is limited to the difference between the agreed remuneration and the value of the defective performance.

8.5. The customer’s rights on account of defects which do not concern construction works or work which consists of furnishing planning and supervision services for construction works, expire under limitation of time in one year, in the case of a work contract calculated from the date of acceptance, in the case of a purchase contract calculated from the date of delivery.

8.6. The foregoing restrictions of warranty and the foregoing regulations on limitation by time do not apply if defects have been maliciously concealed, if an assured characteristic is lacking, if a guarantee has been given for the quality of the performance, in case a major contractual obligation is infringed, in case of gross negligence or malice aforethought on the part of POLIGRAT and in the case of physical injuries, harm to health or loss of life which are attributable to POLIGRAT. Claims under product liability laws are likewise not affected by the foregoing regulations.

8.7. If it is established during attempts at rework that the goods or services were not defective, the customer is then obliged to remunerate the attempted rework undertaken and to recompense all expenditure incurred as a result of the rework.

9. Liability

9.1. Insofar as POLIGRAT is obliged pay damages under legal or contractual regulations, regardless of the legal reasons for this, the amount is limited to the indemnity payment made by POLIGRAT’s employer’s liability insurance. POLIGRAT shall allow the customer to inspect the insurance policy at any time upon request. If the employer’s liability insurance does not grant an indemnity payment, or only a partial payment, POLIGRAT shall then pay legal or contractual damages in accordance with following regulations:

9.2. POLIGRAT’s liability is limited to compensating the direct average damages typical of the contract and foreseeable from the nature of the goods or services. POLIGRAT is not liable for foregone profit, nor for any notional impairment of earnings.

9.3. As regards the amount, POLIGRAT is liable to a maximum of three times the order value, although only to a maximum sum of EURO 50,000. Damages due to default are limited to
0.5 % of the respective order value for each full week of delay up to a maximum of 10 %.

9.4. Claims to damages which do not concern construction works or work which consists of furnishing planning and supervision services for construction works, expire under limitation of time in one year, in the case of a work contract calculated from the date of acceptance of the work, in the case of a purchase contract calculated from the date of delivery.

9.5. The foregoing limitations of liability and regulations of limitation by time do not apply if liability for the damage involves an infringement of a major contractual obligation, an infringement of contract by POLIGRAT, its legal representatives or its vicarious agents as a result of gross negligence or malice aforethought, malicious concealment of a defect or the lack of an assured characteristic. The aforesaid limitations of liability likewise do not apply to physical injuries, harm to health or loss of life attributable to POLIGRAT, nor to liability under product liability laws.

10. Product liability, release
Without prejudice to POLIGRAT’s further-going claims, the customer unrestrictedly releases POLIGRAT from all third party claims pursued against POLIGRAT on the grounds of product liability laws or similar provisions, insofar as the liability rests on circumstances which – such as the presentation of the product – were set out by the customer or other third parties without express written approval from POLIGRAT.

11. Operating secrets, data protection

11.1. POLIGRAT reserves all ownership rights, copyrights, other protected commercial rights and rights to know-how on illustrations, drawings, calculations, other documentation and software issued by POLIGRAT in physical or electronic form. These shall be kept secret from third parties, they may solely be used to execute the particular order and, if they are not the object of the performance to be delivered by POLIGRAT, they shall be returned to POLIGRAT without delay on demand or if no order is issued.

11.2. The customer agrees that the usual data required for the purposes of conducting business may be processed and stored by POLIGRAT’s data processing systems.

12. Special conditions for commission processing
The further-going conditions below apply to contracts concerning commission processing to be performed by POLIGRAT:

12.1. Before the conclusion of contract, the customer is obliged to give express notification to POLIGRAT if the work pieces to be processed are not exclusively intended for normal use or are to be deployed under conditions which are unusual or pose a particular risk to health, safety or the environment, or are to be exposed to higher loads. The customer shall issue a delivery note for all work pieces handed over for processing which describes the work pieces and precisely states the quantities. POLIGRAT can only check quantities by means of spot checks. The customer shall ensure that all the designs it hands over to POLIGRAT for commission processing are suitable and appropriate for commission processing, and that the chemical composition and mechanical properties of these are suited to commission processing. POLIGRAT can only check suitability by visual inspections. Materials with other properties cannot be accepted for processing unless this is expressly confirmed in writing by POLIGRAT in its confirmation of order. The customer shall recompense POLIGRAT for all damages, including foregone profit, which are incurred because materials or designs are supplied that are not suitable for commission processing.

12.2 The price as per the regulations under item 4 remunerates the commission processing work to be performed by POLIGRAT. Cleaning, dressing work and packaging shall be invoiced separately. If auxiliary work is necessary, POLIGRAT is entitled to invoice this within reason and at the rates normally applicable in the trade.

12.3. POLIGRAT performs all commission processing work to the state-of-the-art. POLIGRAT is obliged to supply works of an average type and quality in consideration of tolerances normal in the trade with regard to type, quantity, quality and packaging. In the case of small parts supplied as bulk goods, rejects and shortfalls of up to 5 % do not represent a material defect. Providing the written confirmation of order does not expressly state otherwise, POLIGRAT is not responsible for ensuring that the processed work pieces are suited to a use other than the customary one, nor that these fulfil higher expectations on the part of the customer. POLIGRAT bears no responsibility should the customer submit materials or designs which are unsuitable for commission processing.

13. Applicable law, place of fulfilment and jurisdiction
German law shall apply to the exclusion of the United Nations treaty on contracts concerning the international sales of goods. Unless the contract urgently stipulates otherwise, the place of fulfilment for all present and future claims arising from the business relationship between POLIGRAT and its customer is Munich. The determination of the place of fulfilment has no influence on the place of jurisdiction. If the customer is a merchant, a legal entity under public law or a public law special trust, Munich is the exclusive place of jurisdiction for all disputes arising from the business relationship between POLIGRAT and the customer.

14. Concluding provision
Should one of the provisions in these Terms of Trade be or become unworkable, this shall not affect the remaining provisions. The unworkable provision shall be replaced by the equivalent legal regulations, unless the parties reach an agreement which achieves the intention of the unworkable provision. The contract is unworkable if compliance with it, even in consideration of the aforesaid amendments, would represent an undue hardship for one of the parties to the contract.