General Conditions of Purchase

1. General Terms and Conditions

(1) Our General Conditions of Purchase apply to all deliveries to and services for us (hereinafter called “Subject Matter of Contract” unless otherwise expressly agreed). By ordering or by fulfilling this agreement, the Contractor (supplier, businessperson, or similar) acknowledges the validity of these General Conditions of Purchase.

(2) The general terms and conditions of the Contractor, which oppose these General Conditions of Purchase or which amend them to our disadvantage, are expressly denied. They only become effective if we provide our expressed consent. Accepting without reservations the contractual subject matter and/or its payment in full knowledge of other opposing general terms and condition does not constitute a consent.

(3) In addition, these purchasing terms are effective for future contractual relations even if they are not specifically agreed.

(4) The Contractor assures that it complies with the latest state of technology and the applicable laws and regulations and that it complies with any government requirements.

2. Orders

(1) Orders are only binding if they are in writing. Any later changes and amendments of orders must be in writing. The written form is maintained if sent by fax and electronic means. Any prior offers are free of charge and non-binding.

(2) The Contractor must confirm any orders within 3 days in writing unless it is delivered faster than ordered. Any differences between the order confirmation and the order constitute a new proposal and must be accepted by us in writing. In any other case, we are entitled to cancel the order without the Contractor being able to construe any rights therefrom. Our silence does not constitute an acceptance of the difference.

3. Products to be manufactured for us / transferred documents

(1) Contractual products to be manufactured for us must be produced precisely to our requirements or transferred sketches, drawings, or plans. Any difference constitutes a defect in accordance with Item 9 of these General Conditions of Purchase.

(2) We retain ownership of any documents provided by us for the production. They must be treated confidentially, only used for our purposes, and be not made accessible to third parties. These documents must be stored with the diligence of a prudent business person.

(3) Any documents provided for fulfilling the order must be returned to us upon completion of the order. The Contractor may not retain any copy without our prior consent. The documents must be returned by certified letter or personal delivery upon our request.

4. Shipment / reservation of title

(1) The product(s) are shipped at the agreed upon delivery date or within the delivery period to the shipping address provided in the order. If there are circumstances which make shipment at the stated date more difficult or impossible then the Contractor must notify us promptly about the length of the delay. The shipment must contain the packaging slip that contains our order number and order date. In addition, the order number must be stated on the shipping label.

(2) If it is reasonable to expect by the type of the contractual subject matter, then the delivery must include a German documentation. Other languages require a written agreement.

(3) The Contractor shall pay for the costs of the delivery including packaging, shipping, insurance coverage, and all other ancillary costs unless agreed expressly otherwise.

(4) The Contractor must accept the return of the packaging and transport material upon our request. The return of any materials posing a hazard to health and the environment must always be accepted.

(5) The Contractor bears the risk of shipping.

(6) An extended or prolonged right of the Contractor to retain title as stipulated in general terms and conditions is expressly objected.

5. Delivery

(1) The delivery times or deadlines stated in the order are binding. The timeliness of the delivery or service is determined by our receipt. The Contractor is delayed with the delivery without us having to send a reminder notice. We are entitled to refuse acceptance of delayed delivery and to return the contractual product at the Contractor’s expense and risk. This event does not constitute a delay in acceptance.

(2) The Contractor is obligated to notify us promptly in writing of any delay in dates and deadlines stating the reason, whereby such notification does not relieve the Contractor from keeping the agreed upon dates or deadlines.

(3) We are only obligated to accept partial deliveries in cases where we have specifically agreed to partial deliveries or we have agreed to them in a single exceptional case. The aforementioned provision applies to additional deliveries or not ordered products accordingly. In these cases, we will return the product(s) at the expense and risk of the Contractor. Any unordered products, which were initially accepted, can be picked up from us within 14 days after notification. If they are not picked up, the products are disposed of at the Contractor’s expense.

(4) In the event of a delay, we are entitled to rescind the contract at no charge depending on the case-by-case circumstances. Moreover, in urgent cases, we are entitled to get replacements at the expense of the Contractor, particularly to prevent any delay of our own.

(5) In the event of a delay, the Contractor has to compensate us for any damages incurred. In this case, following a grace period of 10 working days, we are entitled to a lump sum compensation of 0.3% per working day of the delay, for which the Contractor bears the responsibility; however no more than 5% of the order volume. This case gives us the right to deduct the damages occurred from the amount of the invoice. If we enforce this contractual penalty, we will notify the Contractor promptly upon delivery of the contractual subject matter. The Contractor has the right to bring proof that we had no damages or the damage was of lesser amount. The same applies to us. We are entitled to proof that we had a greater damage, in particular in connection with replacement purchases. Any additional damage claims remain unaffected by this provision.

6. Inspections and Notification of Defects

(1) The contractual subject matter is accepted subject to inspection for completeness and that it is free of defects. Any found defects may be claimed within two weeks from the date of receipt of the contractual subject matter. The date the notice of the claim was sent determines the timeliness. Insofar, the Contractor waives the right to raise the objection of an untimely notification of defect.

(2) Any defects that are not determined by the aforementioned inspection but only during processing, commission, or during operations may be claimed by us within two weeks following the date of determination. The date the notice of the claim was sent determines the timeliness. Insofar, the Contractor waives the right to raise the objection of an untimely notification of defect.

(3) If larger quantities are delivered then we are entitled to inspections by random sampling. Any defects not shown during these random inspections are deemed hidden defects.

7. Prices

(1) All prices stated in the order include packaging, shipping, and all other ancillary costs unless agreed otherwise. The mandatory value-added-tax to be paid must be itemized.

(2) The purchase price includes any license fees which may be due and payable.

(3) Any price increases after the order confirmation require our express consent. We are the beneficiary of any price reductions and they must considered in the invoice.

8. Invoice / Payment Terms

(1) The invoice must be sent separately from the shipment to the billing address stated in the order. It must include our order number and the date of the order. If this information is missing and we are late in paying our invoice then it should not be construed as our fault.

(2) The invoice is payable 10 days upon receipt of the shipment and the invoice with 2 % discount and net within 30 days. If we get deliveries early the payment due date starts at the earliest at the agreed upon delivery date.

(3) The timeliness is determined by the transfer of the payment.

(4) Any arrears in payment presupposes a dunning letter by the Contractor.

(5) Payments do not affect our right to defect notification and our claims to guarantees and warranties.

9. Transfer of Risk / Warranty

(1) The risk of accidental loss or a worsening of the condition of the contractual subject matter transfers to us after it is shipped.

(2) The Contractor’s warranties are subject to the legal regulations unless agreed otherwise below. Upon our first demand, the Contractor will indemnify us from all third party claims brought forth due to defects or product damages from the Contractor’s delivery due to its component of cause. The Contractor assures that it has purchased a reasonable product liability insurance policy.

(3) The warranty period is a minimum of 24 months from the date of our receiving the delivers. If the law provides for a longer warranty period then this takes effect.

(4) The contractual subject matter is deemed as defective even if it only insignificantly differs in the individual case from the agreed upon condition. If the contractual subject matter is defective then the Contractor must either rectify the defect or must allow us a price reduction according to legal regulations. In any case, the choice is ours. In urgent cases, we shall be entitled to rectify the defect ourselves or commission a third party with this task or purchase a replacement elsewhere at the expense of the Contractor. The aforementioned shall apply even if the Contractor is delayed in its fulfillment of the warranty obligation or if the defect rectification chosen by us has failed repeatedly. The right to rescind the contract remains unaffected by the aforementioned provision.

(5) Any replacement deliveries and re-workings are at the expense and risk of the Contractor. Any limitation thereof is undue. Warranty dates for replacement shipments are determined by paragraph 3 of this provision and start at the day of delivery at our place of business.

(6) The Contractor agrees to cover the costs of any recall action due to the product liability law. The Contractor shall receive as promptly as possibly a statement by us.

(7) If a defect occurs within six months of delivery, then it is assumed that the item was defective at the time of risk transfer unless this assumption was not in agreement with the type of item or this defect.

10. Force Majeure

Force majeure, strikes, operational disruptions without fault, unrests, war, government actions, and similar disturbing unavoidable events shall relieve us for their duration from our duty to perform. In the event, these take on a larger scope than just insignificant extends than we have the right to rescind the contract.

11. Offsetting / Assignment

(1) We have the right to offset all rightful claims we have against the Contractor against its claims.

(2) The Contractor may only offset such claims against us if these have been rightfully determined by a court of law or acknowledged by us.

(3) The Contractor is not entitled to assign or pledge to third parties any claims against us in part or in whole without our prior consent. In the event of an assignment, the right to the debt of the previous debtor is not discharged.

12. Proprietary Rights

(1) In the event that additions or documents are available in connection with the products to be manufactured for us or to be provided for us then we are the only party with the right to all proprietary rights, rights of use, and rights of sale. The same applies to any processing or re-workings for or by the Contractor. In this case, the Contractor shall transfer these rights to us and we accept this transfer or rights. If such transfer is not possible for legal reasons, then the Contractor shall grant us the exclusive, spatially, and timely unlimited right free of charge as well as all sub-licensing right to use these rights.

Exempted from this provision are such improvements which are undertaken without any proprietary rights violation of the Contractor.

(2) The Contractor assures that it does not violate or impede any proprietary third party rights while using the contractual subject matter as intended. In the event that despite it there is a violation of proprietary rights, then the Contractor shall indemnify us from all third party claims or provide us with a license to use the proprietary right free of charge.

13. Confidentiality and Data Protection

(1) The contractual parties agree to keep confidential all business or technical information of the other party. This shall not apply only to such information which the information recipient has but which is publicly accessible or published without the fault of the information recipient or which must be disclosed due to government regulations or by order of the courts. The information recipient must notify the other party promptly of this circumstance. The contractual parties assure that their employees and commissioned third parties are bound to this confidentiality agreement. This clause continues to be effective beyond the end of the business relationship between the contractual parties and their employees or commissioned third parties.

(2) The Contractor may only refer to our business relationship in its advertising upon our written consent.

14. Final Clauses

(1) Place of performance is the shipping address stated.

(2) If the Contractor is a business person, a legal entity under public law, or a public law special fund, then jurisdiction shall be with the competent courts in Chemnitz. In addition, we shall have the right to bring suit at the Contractor’s legal jurisdiction.

(3) Only the laws of the Federal Republic of Germany apply. The United Nations convention on contracts for the international sale of goods (CISG) is excluded.

(4) Unless agreed otherwise, only the German version of these General Conditions of Purchase applies. If we provide a translation, then this translation serves only for information purposes of the Contractor and is not a binding integral part of this agreement.

(5) If any provision or parts thereof stated in these General Conditions of Purchase are ineffective, it does not affect the validity of the remaining provisions or parts thereof. In this event, the parties will try to find a provision that comes closest to the economic intent of the ineffective provision. If no agreement is made, then the law applies.

Chemnitz, April 23, 2012