General Terms and Conditions of Purchase

heroal - Johann Henkenjohann GmbH & Co. KG
Österwieher Str. 80
33415 Verl (Germany)

Phone +49 5246 507-0
Fax +49 5246 507-222

www.heroal.com
info@heroal.de

1 Scope of these terms and conditions
1.1 Our deliveries, services and offers are provided solely on the basis of these terms and conditions. They thus also apply to all future business relations, even in the absence of a subsequent, explicit agreement to that effect. It shall be assumed that these terms and conditions are accepted, at the latest upon receipt of the goods or services.

1.2 Conflicting confirmation by the customer, with reference to the customer's terms and conditions of business or purchase, is hereby excluded.

1.3 Deviations from these terms and condition are only valid if we confirm them in writing.

2 Conclusion of offer and contract
2.1 Our offers are subject to confirmation. Services and calculations are realised according to the prices indicated on the day of dispatch or collection of goods. Significant changes in costs – e.g. due to increased raw material prices or wages – while the order is in progress entitle us to request a price adjustment or, in the event of disagreement, to withdraw from the contract. No freight is charged for deliveries realised with our own HGV, for orders valued at €3000.00 and above. For other means of dispatch and for order values of less than €3000.00, the freight costs are to be met by the customer.

2.2 If an order from the customer qualifies as a binding offer (§ 145 BGB – German Civil Code), we can accept this offer within 2 weeks. This acceptance can occur in writing or by means of delivery of the goods.

2.3 Unless otherwise stipulated upon order confirmation, upon delivery or dispatch of goods, risk is passed to the customer “ex works” – i.e. as soon as the consignment has been transferred to the person responsible for transport or has left our warehouse or business premises for dispatch. If dispatch becomes impossible without culpability on our part, the risk shall pass to the customer upon notification of availability for dispatch. We do not provide transport insurance.

2.4 Unless otherwise arranged, we do neither charge for, nor take back, single-use packaging. Retrieval is not among our obligations. Special packaging, e.g. steel pallets and crates, are billed at cost. Steel pallets are to be returned by the customer at the customer's expense, without charging freight. If they are returned free of all charges, in usable condition, we shall issue a credit note for the full value.

3 Prices/payment conditions
3.1 Unless otherwise arranged, all prices are in euros and are subject to VAT at the respective applicable rate.

3.2 Unless otherwise arranged in writing, payment is to occur within 30 days after the invoice date, strictly net. Cash discounts (maximum 2%) can only be approved if payment occurs within 10 days after invoicing. Cash discounts are only granted if all due payment obligations, including those from previous deliveries, are fulfilled and the invoice sum is paid to us punctually in cash, or credited to our account, by the aforementioned due dates.

3.3 If the aforementioned payment deadline is exceeded, we are entitled to charge statutory default interest, without the need for a specific notice of default. This does not exclude the assertion of additional claims for damages.

3.4 Payment shall be deemed effected as soon as we have unconditional access to the sum. Cheques shall only be accepted on account of fulfilment. Payment shall only be deemed effected once the cheque has been honoured and we have unconditional access to the sum.

We reserve the right to accept external or internal bills of exchange. The costs and discount charges are to be met by the customer. We do not guarantee prompt discharge of prolonged bills of exchange on our part.

3.5 The customer is only entitled to offsetting rights if their counter-claims are determined to be legally valid, are undisputed or are recognised by us. Moreover, the customer is authorised to exercise a right of retention only insofar as the customer's counter-claim is based on the same contractual relationship.

4 Deliveries
4.1 The arrangement of binding deadlines or time periods must occur in writing and shall be agreed upon individually. The specified time period can only begin after all technical questions have been clarified. Upon failure to adhere to a binding deadline confirmed in writing, the customer is obliged to set us an appropriate extension period in writing. If fulfilment does not occur within the extension period either, the customer is entitled to withdraw from the contract.

4.2 Insofar as we cannot meet binding delivery deadlines, for reasons not due to any failing on our part (non-availability of performance), we shall notify the customer immediately and inform them of the estimated new delivery period. If performance remains unavailable within the new delivery period, we are entitled to withdraw from the contract in whole or in part; we shall immediately reimburse the customer for any counter-performance already realised. In particular, if our suppliers fail to deliver to us punctually, this applies as non-availability of performance in this regard if we have concluded a congruent hedging transaction. Our legal rights of withdrawal and termination, as well as the legal regulations regarding contract remuneration upon exclusion of the obligation to perform (e.g performance and/or subsequent performance become(s) impossible or unreasonable) shall remain unaffected. The customer's rights of withdrawal and termination according to these General Terms and Conditions shall also remain unaffected.

4.3 The customer is entitled to assert claims of default insofar as we are responsible for the default. However, the customer must issue a warning in each case. In the event of only slightly negligent breach of obligations on our part or on the part of our vicarious agents, our liability is limited to the amount of damages typically foreseeable for the type of contract.

This does not affect our liability for damages resulting from injury to life, bodily injury, damage to health, intent or gross negligence. Furthermore, our liability as defined by the German Product Liability Act (ProdHaftG) shall remain unaffected.

4.4 If the customer defaults on acceptance or breaches any other obligation to cooperate, we are entitled to demand a lump-sum payment amounting to 3%, and no more than 10%, of the remuneration as compensation for our costs, without prejudice to other claims. However, the customer is permitted to submit evidence that we have not suffered any damages, or that our damages are substantially less than the lump sum referred to in sentence 1.

5 Retention of title
5.1 We retain ownership of the delivered goods until all claims with respect to the customer which result from the business relationship, including claims arising in future – also from contracts concluded at the same time or at a later date – are settled. This also applies if individual claims, or all claims, have been included in an ongoing invoice and the balance has been struck or approved.

5.2 The goods subject to retention of title may not be pledged to third parties or assigned as security until the secured claim is paid in full. If third parties access the goods which belong to us, the customer is to notify us immediately in writing, stating the extent of this access.

5.3 The customer is entitled to sell the goods on, in the ordinary course of business, provided that the receivables from the onward sale are transferred to us as follows: The customer immediately assigns to us all claims and ancillary rights which accrue to the customer against the purchaser or against third parties as a result of the onward sale, irrespective of whether the goods subject to retention of title are sold on in an adapted or unadapted form.

The customer is entitled to collect these claims even after assignment. Our right to collect these claims ourselves shall remain unaffected. However, we undertake to refrain from collecting such claims, as long as the customer fulfils their payment obligations. Upon request, the customer is to provide us with all information necessary for identification of the third party and for assertion of the assigned claims. If the goods are resold together with other goods which belong to the customer, our claim against the purchaser is regarded as assigned, to the amount of the delivery price agreed between us and the customer.

5.4 With regard to any handling and adaptation of the goods subject to retention of title, we qualify as the manufacturer within the meaning of § 950 BGB (German Civil Code), but without any further obligation. The adapted goods are regarded as goods subject to retention of title for the purposes of these terms and conditions. If the goods subject to retention of title are adapted, or inseparably mixed, with other items that do not belong to us, we shall acquire ownership of the new object in the ratio of the invoice value of the goods subject to retention of title to the invoice value of the other goods used at the time of adapting or mixing. The resulting co-ownership rights are regarded as goods subject to retention of title for the purposes of these terms and conditions. If our goods are combined and inseparably mixed with other movable objects to form a unified item and if the other item is to be seen as the main item, it is hereby agreed that the customer shall assign co-ownership to us proportionally, insofar as the main item belongs to the customer. In addition, the same conditions apply for the item created by adapting, combining and mixing as apply for the goods subject to retention of title.

5.5 If the customer acts in breach of contract, particularly in the event of default on payment, we shall be entitled to withdraw from the contract after setting an appropriate payment deadline. We are then entitled to retrieve previously delivered goods and the customer is obliged to return them. In the event of attachments or other interventions by third parties, the customer must notify us immediately in writing, including a report of attachment and a statutory declaration as to the identity of the attached item.

5.6 Notwithstanding the customer's payment obligations, we are entitled to sell the retrieved goods to the best of our ability and to credit the proceeds in full, or upon deduction of a 25% decrease in value. The original invoice price shall serve as a basis. The regular decrease in value is determined according to the worsened condition of material, the costs of collection and the worsening of the goods caused by the return transport. However, the customer is permitted to submit evidence that we have not suffered any damages, or that our damages are substantially less than the lump sum referred to in sentence 1.

5.7 If the realisable value of securities exceeds our claims by more than 10%, upon the customer's request we shall release securities, as selected at our discretion.

6 Legal guarantee
6.1 The customer is obliged to unpack and inspect the delivered goods immediately upon receipt (§ 377 HGB – German Commercial Code). Complaints of any kind are to be made in writing within 8 days after delivery. We are to be notified of any concealed defects immediately upon discovery thereof, and no later than 10 days after discovery. After this deadline has passed, the goods are regarded as faultlessly delivered and approved.

6.2 We shall rectify defects by means of repair or replacement. If subsequent performance fails, or would entail disproportionate costs, the customer retains the right to a reduction in price and the right of withdrawal. In the event of only slight defects, or only a slight breach of obligations on our part, withdrawal is excluded.

6.3 We guarantee our goods in accordance with the respective legal guarantee period, as long as the customer uses the goods in the usual and intended manner. In this regard, we point out that the technical specifications which we issue, with respect to the contractual object and intended use, only represent the approximate character and type of the goods. Permissible tolerances defined by DIN are no grounds for complaint and do not denote defects. We shall not be held responsible for defects in the event of natural wear and tear, damage caused by improper handling, inadequate storage, or if the defect is due to the goods being used in a special manner which was not indicated to us in writing upon conclusion of the contract. The period begins when the goods are handed over to the customer.

7 Compensation for damages/liability
7.1 Unless provided otherwise below, claims for damages on the part of the customer – whatsoever the legal grounds – shall be excluded. We shall therefore not be held liable for damage not occurring to the delivery item itself; in particular we shall not be held liable for the customer's lost profit or other financial losses.

7.2 In the event of solely negligent breach of obligations on our part or on the part of our vicarious agents, our liability is limited to the amount of damages typically foreseeable for the type of contract. For damages resulting from injury to life, bodily injury or damage to health on the part of the customer, as well as from intent or gross negligence, we accept liability according to the legal requirements. This also applies if the customer, due to the absence of a guaranteed characteristic of the item or due to fraudulent concealment, desires compensation for damages in lieu of performance. Furthermore, our liability as defined by the German Product Liability Act (ProdHaftG) shall remain unaffected.

7.3 Insofar as our liability is excluded or limited, this shall also apply to the personal liability of our salaried employees, waged workers, hired staff, representatives and vicarious agents.

8 Defence of insecurity
If, after conclusion of the contract, it becomes evident that the customer's insufficient ability to pay endangers our payment claim, we can withhold our performance. This right to refuse performance on our part shall not apply if the customer provides payment or security for payment. We are entitled to set an appropriate period, during which the customer is to progressively provide payment or suitable security against delivery. If this period expires unsuccessfully, we are entitled to withdraw from the contract.

9 Applicable law/jurisdiction/partial nullity
9.1 These terms and conditions, as well as all legal relationships between ourselves and the customer, shall be governed by the law of the Federal Republic of Germany.

9.2 Our General Terms and Conditions of Use also constitute part of our deliveries.

9.3 If the customer is a trader as defined in the German Commercial Code (HGB), a legal entity under public law or a separate estate under public law, jurisdiction shall be solely that of the district court of Gütersloh (Amtsgericht Gütersloh) and the regional court of Bielefeld (Landgericht Bielefeld) for all disputes resulting directly or indirectly from the contractual relationship, according to the value of the claim.

9.4 Should a provision in these terms and conditions of business be or become invalid, the validity of the remaining provisions shall remain unaffected. If the invalidity is based on a performance-related or time-related stipulation, the measure prescribed by law comes into force in its place.