General Business Terms of Sale and Delivery of Shin-Etsu Pharma & Food Materials Distribution GmbH

1. Scope of Application

 

a) These terms and conditions (“Terms of Delivery”) shall apply to all sales and deliveries made by us to our customer (“Buyer”), either now or at any future date.

 

b) These terms and conditions shall be accepted by Buyer by the placing of an order or the receipt of delivery.

 

c) The application of any general terms and conditions of Buyer shall be expressly excluded even if we fail to expressly reject them.

 

 

 

2. Offer and Conclusion of Contract

 

a) Our quotations are non-binding.

 

b) A contract shall come into force only upon our written confirmation of an order or by our execution of an order and shall be governed exclusively by the contents of the confirmation of order and these Terms of Delivery.

 

c) Verbal agreements or promises shall only be valid if an authorized employee of ours has confirmed them in writing.

 

 

 

3. Delivery Periods and Delivery Dates

 

a) Delivery dates shall not be binding unless they have been expressly stated to be binding and Buyer has provided us in a timely manner with all of the information and/or documentation required for the performance of such delivery and Buyer has made any advance payments in the manner and amount as agreed upon with us. Delivery periods agreed upon shall begin on the date of the order confirmation. In the event of additional or supplementary contracts entered into at a later date, the delivery periods and delivery dates shall be extended or rescheduled accordingly, as applicable.

 

b) We shall be entitled to effect partial shipments if Buyer can reasonably be expected to accept such partial shipments under the circumstances. Invoices for any partial shipment shall be payable irrespective of the completion of delivery.

 

c) Product details and criteria for use in catalogues, instruction leaflets, safety data sheets and other information material that we make available to Buyer, as well as descriptions of goods, are not to be understood as guarantees for a particular quality of the goods nor as an agreement of the quality. Such quality guarantees must be exclusively agreed in writing.

 

d) With regard to goods that we do not manufacture ourselves, the obligation to deliver shall be subject to our correct and timely receipt of such goods from our suppliers.

 

e) If our deliveries to Buyer are delayed, Buyer shall only be entitled to rescind the contract if (i) we are responsible for the delay and (ii) a reasonable grace period set by Buyer has expired.

 

f) Should Buyer be in default of the acceptance of delivery or should he be in breach of any other obligations to cooperate with us, we shall be entitled, without prejudice to any other rights, (i) to reasonably store the goods at Buyer's risk and expense or (ii) to rescind the contract in accordance with the statutory provisions.

 

 

 

4. Prices and Payment

 

a) Buyer shall bear any public charges such as possible customs duties that may arise in connection with the import of the goods.

 

b) If the agreed delivery date is more than four months later than the conclusion of the contract and if, after conclusion of the contract, we have incurred unforeseeable cost increases with regard to the goods for which we do not bear responsibility, we shall be entitled, at our reasonable discretion, to pass on such higher costs by increasing the agreed price on a pro rata basis.

 

c) With regard to long term contracts concluded with Buyer, i.e. especially long term supply contracts, we are entitled to reasonably increase our prices with effect from the first day of January of any calendar year if and to the extent our costs for the goods increased during the previous calendar year. We shall inform Buyer in writing of the intended increase at least eight weeks before it will take effect.

 

d) Bills of exchange shall be accepted only after prior written agreement, on account of performance and on condition of being eligible for refinancing with central banks. All charges incurred for the payment of bills and transfers shall be met by Buyer.

 

e) Each of our invoices shall be due for payment in accordance to the payment terms from the date of invoice; if this period for payment lapses unsuccessfully, Buyer shall be in default. Payments by Buyer shall not be deemed to have been made until we have received such payment.

 

f) If Buyer is in default, we shall be entitled to demand default interest in the applicable statutory amount of eight percentage points above the base rate within the meaning of Sec. 247 BGB (German Civil Code). We reserve the right to claim further damages due to default.

 

g) In the event of justified doubts as to Buyer's solvency or creditworthiness, we shall be entitled – notwithstanding our other rights – to demand advance payment for all deliveries not yet made or services not yet rendered and to require immediate payment of all claims arising from the business relationship. Our obligation to supply shall be suspended while Buyer is in default with a due payment.

 

h) Buyer is only entitled to set-off counterclaims or assert a right of retention to the extent the respective counterclaim is uncontested, ready for decision or has been finally adjudicated. The assertion of a right of retention additionally requires that Buyer’s counterclaim is based on the same contract.

 

 

 

5. Force Majeure

 

Unforeseen breakdowns, delayed deliveries or non-delivery by our suppliers (including intra-group suppliers), shortage of labor, power or raw materials, strikes, lockouts, difficulties in providing means of transport, traffic disruptions, government orders, embargoes, boycotts and any other events of force majeure shall relieve the party affected thereby of its obligation to supply or accept the goods, as the case may be, for the duration of and to the extent of such hindrance. If, in consequence of such hindrance, delivery or acceptance is delayed by more than one month or the end of such hindrance is not foreseeable, either party, to the exclusion of all further claims, may rescind the contract in respect of the quantities affected by such delay.

 

 

 

6. Shipment and Transfer of Risk

 

a) If the parties agree that the goods shall be shipped to Buyer, we shall use a reasonable method of shipment in the usual manner of packaging. In the case of such a shipment, the risk shall pass to Buyer when (i) the consignment is transferred to the first carrier, or (ii) if the goods are made available for collection by Buyer, upon handover to Buyer, or (iii) if a third party authorized by Buyer collects the goods, upon handover to this third party. This principle shall apply even if Buyer refuses to take delivery of the consignment.

 

b) Should Buyer be in default of acceptance, risk shall pass to Buyer upon default. If, in case the goods shall be collected by Buyer or a third party authorized by Buyer, and delivery is delayed on grounds for which Buyer is responsible, risk shall pass to Buyer on the date Buyer is notified of the readiness of the goods for shipment.

 

c) Transport insurance shall be taken out only upon request and at the expense of Buyer.

 

 

 

7. Retention of Title

 

a) We shall retain title to the goods until full payment of all claims arising from the business relationship with Buyer. In the case of current accounts, this retention of title shall serve as security for the claim for the balance to which we are entitled.

Any machining or processing of the goods subject to reservation of title (“Collateral”) shall be carried out on our instructions.

If Buyer processes the Collateral together with other goods not owned by us, we shall acquire co-ownership of the new product, our proportionate share being equivalent to the invoice value of the Collateral relative to that of the other processed goods at the time of processing. The new goods created by way of processing shall be subject to the same provisions as applicable to the Collateral.

If Collateral is processed, combined or mixed with other goods not owned by us in accordance with Sec. 947 and 948 BGB, we shall become co-owners in accordance with the provisions of the law. If Buyer acquires sole ownership through processing, combining or mixing, it shall be deemed to be agreed that Buyer assigns joint ownership to us proportionate to the value of the Collateral relative to that of the other goods at the time they are processed, combined or mixed.

In these instances Buyer shall hold in safe custody and free of charge the item that is owned or co-owned by us and deemed to be Collateral within the meaning of the terms of this clause 7.

 

b) To safeguard our total receivables resulting from the business relationship, Buyer shall here and now assign to us such claims outstanding from resale as are equivalent to the value of the Collateral.

 

c) Buyer shall only be allowed to sell Collateral within normal and proper business transactions. Buyer is not entitled to pledge the Collateral, grant chattel mortgages on it or make other dispositions endangering our title to such goods. Buyer hereby assigns its receivables arising from the resale of the Collateral to us, and we hereby accept such assignment. Should Buyer sell the Collateral after processing or transformation or joining or mixing of such goods with other goods or together with other goods, this assignment of receivables shall only be agreed to for an amount equivalent to the price agreed to between us and Buyer plus a safety margin of 10 % of this price. Buyer is granted the revocable authorization to collect in trust the claims assigned to us in his own name. We may revoke such authorization and the right to resell the goods if Buyer is in default of the performance of material obligations such as making payment to us.

 

d) If the value of our total Collateral exceeds the amount receivable from Buyer by more than 10%, we shall, at the request of Buyer or any third party adversely affected thereby release Collateral of our choice to the extent of the excess.

 

e) Buyer shall provide us at all times with all desired information concerning the Collateral or receivables assigned to us under this contract. Buyer shall immediately notify us of any attachments of or claims to the Collateral by third parties and shall provide the necessary documents in this regard. Buyer shall at the same time advise the third party of our reservation of title. The costs of a defense against attachments and claims shall be borne by Buyer.

 

f) Buyer shall assume the risk for the Collateral. He shall keep the Collateral carefully in safe custody and insure them adequately against loss (theft, fire, etc.). He shall provide us with the respective proof of such insurance and shall assign the claims arising under such insurance to us, namely for a priority share equivalent to the purchase price of the goods owned and supplied by us.

 

g) Should Buyer be in default of material obligations such as payment to us, and should we rescind the contract, we may, notwithstanding any other rights, request surrender of the Collateral and may make use of them otherwise for the purpose of satisfying our matured claims against Buyer. In such case, Buyer shall grant us or our agents immediate access to the Collateral and surrender the same.

 

h) In the case of deliveries to other jurisdictions in which the foregoing provisions governing the reservation of title do not have the same effect as in Germany, Buyer shall do everything to create equivalent security rights for us without undue delay. Buyer shall cooperate in all measures such as registration, publication, etc. that are necessary and beneficial to the validity and enforceability of such security rights.

 

 

 

8. Quality and Claims for Reasons of Defects

 

a) The quality of the goods shall be determined exclusively in accordance with the standard specification or, if applicable, with the specification agreed.

 

b) Buyer must check whether the goods supplied comply with the contract and are suited to their intended purpose. We must be notified of any obvious defects within two weeks following delivery, of concealed defects immediately upon their discovery.

Damage to packaging must be noted in the freight papers or notification made in writing to the carrier and to us at the latest six days after delivery in order to allow us to secure potential claims against the carrier.

 

c) In the event of a notification of a defect, we shall have the right to inspect and test the goods to which objection was made. Buyer will grant us the required period of time and opportunity to exercise such right. We may also demand from Buyer that he returns to us at our expense the goods to which objection was made. Should Buyer's notification of the defect prove to be unjustified and provided Buyer has realized this prior to the notification of the defect or has not realized it in a negligent manner, Buyer shall be obliged to reimburse us for all costs incurred in this respect, e.g. travel expenses or shipping costs.

 

d) We will remedy defects of the goods supplied, taking Buyer's interests into consideration, repair or replacement (together “Subsequent Performance”). Buyer shall give us the necessary reasonable time and opportunity for Subsequent Performance. If Subsequent Performance does not lead to success Buyer is entitled to have recourse to the statutory laws.

 

e) Defective goods which have been replaced by us may only be returned to us with our express agreement. In the instance of justified claims we shall refund the cost for the most reasonable dispatch.

 

f) Buyer's rights in case of defects shall be excluded in the following events: (i) natural wear and tear, and (ii) defects of the goods due to reasons for which Buyer bears responsibility, such as inappropriate or improper use or faulty treatment.

 

 

 

9. Limitation of Liability

 

a) We shall accept liability according to the statutory provisions:

 

(i) for minor negligence (einfache Fahrlässigkeit) in the event of breaches of major contractual obligations (wesentliche Vertragspflichten) up to the amount of the typically foreseeable damage;

 

(ii) in cases of damages caused intentionally or by gross negligence, culpably caused personal injuries (emschuldhaft verursachte Körperschäden), liability under the German Product Liability Act, and/or in case of any further mandatory liability like assumption of a guarantee.

 

All other claims on whatever legal basis shall be excluded. The foregoing limitation shall also apply to the reimbursement of expenses.

 

b) Buyer shall take all reasonable measures necessary to avert and reduce damages.

 

 

 

10. Product Liability

 

If Buyer sells the goods, whether unchanged or changed, whether after processing, transformation, joining, blending or mixing with other goods, Buyer shall indemnify us in our internal relationship against any product liability claims of third parties if and to the extent Buyer is responsible for the fault leading to the liability also within our internal relationship.

 

 

 

11. Statute of Limitations

 

The limitation period for Buyer's claims for defects shall be twelve months beginning with the handover of the goods to Buyer. For damage claims of Buyer due to other reasons than defects of the goods or for rights of Buyer with respect to defects concealed in bad faith or caused intentionally, the statutory limitation period shall apply.

 

 

 

12. Trademarks

 

a) Trademarks may be used in connection with products manufactured by Buyer only with the trademark owner's express written consent.

 

b) Buyer shall not perform and may not authorize a third party to perform any act that may endanger the trademarks or other intellectual property rights used by us in relation to the goods.

 

 

 

13. Safety

 

To the extent that our goods are subject to the German Regulations on Dangerous Substances, Buyer shall, when storing and processing such goods, observe our product-specific safety data sheet and/or, when reselling the goods, pass on the relevant data to the purchaser. We can supply current safety data sheets upon request. To the extent that goods supplied by us are categorized as dangerous goods, they may be stored and (further) transported only in the packaging and by the means of transport approved for the purpose and with the prescribed labeling.

 

 

 

14. General Provisions

 

a) Buyer may assign the rights arising from the parties' contractual relationship to third parties only with our written consent. Section 354a German Commercial Code (HGB) shall remain unaffected hereby.

 

b) Amendments and supplements to the contract and/or these Terms of Delivery and any side agreements must be made in writing. The same shall apply to the amendment of this written form requirement.

 

c) If any clause of the contract and/or these Terms of Delivery is invalid, the validity of the remaining clauses shall not be affected thereby.

 

d) The laws of the Federal Republic of Germany shall apply exclusively to these Terms of Delivery and the parties’ contractual relationship unless otherwise expressly agreed in writing. The application of the United Nations Convention on Contracts for the International Sale of Goods is excluded.

 

e) The exclusive place of jurisdiction for any and all disputes arising from or in connection with the parties’ contractual relationship shall be Frankfurt am Main. We are entitled, however, to sue Buyer at any other court having statutory jurisdiction.

 

 

Juni 2013