Lothar A. Wolf Spezialmaschinen GmbH

Installation Terms for New and Second-hand Machines

§ 1 Validity of Terms(1)

All installation work shall require the purchaser’s prior order in writing. Orders made verbally or by telephone shall be subsequently submitted in writing. Orders shall only bind us with respect to content, type and scope after our order confirmation has been made in writing or by fax/e-mail. Supplements, amendments and/or collateral agreements, in particular all eventual promises require our written and/or faxed/e-mailed confirmation.

(2)

Eventual promises and/or agreements made by our service staff shall only bind us if we have confirmed them in writing or by fax/e-mail. Our staff is not entitled to make such promises or agreements without our consent.

(3)

These Terms shall be valid for all installations we carry out, as far as divergent agreements have not been made in an individual case. We shall enclose the Terms with all offers and with the order confirmation. The purchaser can request an additional copy at all times. These Installation Terms shall also be valid for all future business relations, even if not expressly reiterated. These Terms shall be deemed as accepted upon receipt of a performance. We shall object expressly should a purchaser invoke his own business terms.

§ 2 Installation Rates(1)

The installation shall be invoiced on a time basis as provided in the annex, unless a package price has been agreed on. Our charges are based on the tarifs concluded by the Union for Iron, Metal, and Electric Workers in North-Rhein Westfalia. A change in tarifs, as well as any wage changes shall result in a revision of the installation rates. Changes in material costs shall also lead to revisions in the installation rates. We shall only invoice the rates valid during the performance of the work.

(2)

We shall invoice installation costs on completion of the work; prolonged installations shall be invoiced on account. Upon installation completion the purchaser’s signature on the certification of working hours shall confirm the correctness of the entries. A photocopy of this certification shall remain with the purchaser for verification of the invoice.

The amounts agreed on shall be understood net, excluding value-added tax, which shall be additionally borne by the purchaser at the prevailing statutory rate.

(3)

All installation invoices shall be paid without deduction. Payment shall be due at acceptance, from which date 5 % interest shall be charged. This shall also apply when installations are accepted in part and payment is fixed for individual parts. Invoices on account shall be due and payable on receipt. Should the purchaser not make payment within 14 days of acceptance and receipt of invoice/invoice on account he shall owe us 8 % interest above the basic interest rate 14 days after the due date and receipt of invoice. Further rights shall remain reserved. Payment by bills of exchange or cheques shall only be deemed effected when the amount has been entered to our account. Discount, taxes and expenses shall go to the purchaser’s expense.

The purchaser shall only have the right to retain payments or to set off against a counterclaim so far as eventual counterclaims have been ascertained as uncontestable and legal. Should an undisputable defect exist the purchaser shall be entitled to retain a maximum of three times the amount required to remedy the defect.

(4)

If the purchaser delays in making payment or we have reason to fear due to circumstances prior to delay we may fail to receive payments or other benefits from the purchaser either completely or in due time, we shall be entitled to refuse our performance until either payment has been made in full or security has been provided. Should neither payment be made nor security provided we shall be entitled to withdraw from the contract and demand damages in the place of performance after a reasonable time has elapsed – as far as this time period is not legally lacking – , and which is generally set at 14 days.

§ 3 Purchaser’s Participation(1)

The purchaser shall name a responsible and authorized representative we can address for the duration of the installation.

(2)

The purchaser shall at his expense assist our service staff in carrying out the installation.

(3)

The purchaser shall take the special measures required to protect persons and objects at the installation site. He shall also inform the project engineer of existing safety regulations, as far as they are relevant for our installation staff. He shall notify us of all eventual safety regulation violations on the part of the installation staff. He shall be entitled in agreement with the project engineer to refuse to the party in question entry to the installation site, should a serious violation have been committed.

§4 Purchaser’sTechnical Support(1)

The purchaser shall be obligated at his expense and at his risk to give technical aid and support, in particular by

providing suitable helpers (such as bricklayers, carpenters, fitters, other skilled workers, labourers), which the project engineer shall request, determining the number and the time at his discretion; the helpers shall follow the project engineer’s instructions. We shall not be liable for the helpers. Should defects or damages result due to helpers following instructions made by the project engineer § 7 or § 8 shall apply.
performing all excavation, construction, bedding and/or scaffolding work including the provision of the building materials required.
making available the devices and heavy tools (such as hoists, compressors, portable forges, welding units, drills) required, as well as the necessary supplies and materials (such as scaffolding timber, bolsters, backings, cement, plaster and sealing material, lubricants, oxygen, acetylene, fuel, transmission cables and belts).
providing heating, lighting, motive power, water, compressed air, electrical power, including the connections required.
making available to the installation staff rooms, which are dry and can be locked up, for the purpose of storing their tools.
providing transportation of the installation parts to the installation site, protecting the installation site and materials from all types of damaging influences, cleaning the installation site.
making available appropriate, burglarproof quarters, workshops (provided with e.g. heating, lighting, lavatory and sanitary facilities), first aid facilities for the installation staff.
making available all materials and performing other acts necessary for the adjustment of the object to be installed and for its testing if contractually stipulated.

(2)

The technical aid and support provided by the purchaser shall warranty that the installation be able to begin immediately on arrival of the installation staff and be carried out without delay up to the purchaser’s acceptance. In compliance with the order the project engineer shall also be entitled to make all necessary arrangements for winding up the contract, even to procure spare parts at the expense of the purchaser. The project engineer shall determine the scope of the necessary installation work as regards the subject matter requirements. We shall place special drawings or instructions at the purchaser’s disposal in due time, should they in our opinion be required. Before installation begins the purchaser shall notify the project engineer of the nature of the instructions he has given his helpers and that he has subordinated his helpers to the project engineer’s directives. Should notification not take place, the project engineer shall presume – as provided – that he shall have full authority within the scope of the installation.

(3)

Should the purchaser fail to perform his duties, we shall be entitled, however not obligated, after prior notice to perform the acts incumbent on him in his place and at his expense. In other respects our legal rights and claims shall remain unaffected, in particular the right to demand appropriate compensation in the case of default of acceptance.

(4)

We shall be entitled to replace mechanics. Should a mechanic – for whatever reason – be prevented from rendering the services assumed, or should he leave his place of work in breach of contract, we shall not be liable for the eventual damages resulting thereof, unless we can be held for wilfull or gross negligent conduct.

§ 5 Deadlines and Risk(1)

The installation time period shall be deemed observed when the installation is ready for acceptance at the expiration of such time period or if contractually agreed, the machine/plant is ready for initial operation. The purchaser shall on completion of the installation confirm that all work has been properly carried out, that the machine works and that the installation has been accepted.

(2)

Should the installation and/or the initial operation be delayed due to measures resulting from labour disputes (e.g. strike, lockouts etc.) or to circumstances beyond our control, the installation time period shall be extended appropriately; this shall also apply should such circumstances occur after already being in default. The purchaser shall carry any costs accrued by us, in particular costs arising from waiting time and further travelling expenses acquired by service engineers.

(3)

Should the purchaser incur losses due to a default on our part, he shall be entitled to claim compensation for default; it shall amount to 0.5 % for each full week of delay, in total however not exceed 5 % of the installation cost for the plant part we are to install, which as a result of the delay cannot be used in due time. If the purchaser grants an appropriate period of additional time in case of default and this extension elapses through our fault, the purchaser shall be entitled to revoke the installation mandate. Further claims shall not exist – notwithstanding § 8 Item (3).

(4)

Should the installation service be lost or deteriorate before acceptance through a fault not attributable to us, we shall be entitled to charge the installation cost deducting the expenditures saved. The same claim shall apply for impossibility of installation through a fault not attributable to us. The purchaser shall be entitled to request the installation to be repeated if and as far as this request can be reasonably expected of us according to the circumstances and with regard to our further/other obligations. Renumeration on the basis of the contractual prices shall be due anew for the repeated installation.

§ 6 Acceptance(1)

The purchaser is obligated to accept the installation as soon as he has been notified of the completion of the installation and – if contractually agreed – an initial operation of the installed machine/plant/object has taken place. A successful initial operation shall pass for an acceptance should other agreements not have been met. Should the installation prove not to be conform to the contract, we shall remedy a defect at our expense. We shall not assume costs if the defect is irrelevant for the purchaser’s interests or is due to circumstances attributable to the purchaser. Acceptance cannot be refused due to immaterial defects.

(2)

Should acceptance be delayed through a fault not attributable to us, the acceptance shall be deemed as given two weeks after receipt of notification of acceptance and/or readiness of operation and the submittance of a supporting document agreed on (e.g. documentation). Acceptance shall also be effective if the purchaser puts the plant in operation or to use without our assistance.

(3)

Liability for known defects not reserved shall be cancelled on acceptance; the same shall apply to recognizable, unnotified defects, unless a defect has been fraudulently concealed or the defect lies within a contractually stipulated warranty of performance within the scope of the installation.

§ 7 Warranty(1)

After acceptance of the installation we shall be liable for installation defects to the exclusion of all other claims made by the purchaser notwithstanding Item (5) and § 8 such that we shall remedy the defects by subsequent performance. The purchaser shall give notification of a defect immediately (§ 377 Commercial Code), at the latest within 14 days.

(2)

Our firm shall not be liable for defects if they are irrelevant for the purchaser’s interests or due to circumstances attributable to the purchaser.

When connecting or combining our machines/plants with foreign units, which shall be clarified with our technical department prior to installation, we shall not assume warranty for faultless installation and function of foreign units even if our installation staff has been entrusted with their connection and assembly. We shall only be liable for installation defects if our staff has committed gross negligent or wilfull errors during installation or if we have assumed a warranty for the condition of the defective part in particular.

(3)

A warranty claim presumes not only an immediate notification of a defect, but also that the purchaser allows us the possibility of examining the claim and remedying eventual defects. We shall be entitled to refuse subsequent performance until the purchaser has fulfilled his contractual obligations. Our warranty obligation shall be limited to the original purchaser and not be transferable. We shall also not be obligated to remedy defects if they are due to incorrect or insufficient documents or information given by the purchaser. Liability shall be excluded for the consequences ensuing from alterations or repairs carried out by the purchaser himself or a third party without our consent. The purchaser shall notify us immediately and obtain instructions in urgent cases where the operational safety is endangered and where disproportionately large damage must be warded off. The purchaser shall only be entitled to remedy the defect himself or by a third party and demand the indemnification of necessary and substantiated expenses if said instructions are not obtainable and/or we are in default for more than a month in remedying the defect.

(4)

Should a claim prove to be justified we shall carry the immediate costs of subsequent performance and assume the necessary expenses incurred by transportation, mileage, labour and material, as far as they are not to be provided by the purchaser. We shall be entitled to refuse subsequent performance according to legal provisions if we incur disproportionately large expenses. We shall not be liable for work and acts carried out by our installation staff not connected with the installation or for work defects ensuing from the purchaser’s intervention.

(5)

The purchaser shall be entitled to reduction if we through our fault allow an appropriately set extension for subsequent performance to expire. The right to reduction shall also apply in such cases where the remedying of a defect has failed. The purchaser shall only be able to revoke the contract after giving further notice of two weeks, if it is proven that the installation is without interest for him despite reduction.

§ 8 Other Liability, Exclusion of Liability(1)

Should a delivered part be damaged during the installation through our fault we shall repair or redeliver it at our option and at our expense.

(2)

Should the purchaser not be able to use the installed object as contractually agreed through our fault as a result of the omission or faulty implementation of suggestions and recommendations prior to or after the conclusion of the contract, as well as of other contractual obligations (e.g. faulty instructions for the operation and maintenance of the installed object), the stipulations in § 7 and § 8, Items (1) and (3) shall apply accordingly under the exclusion of all further purchaser claims.

(3)

The purchaser shall not be able to assert further claims for compensation (nor for damages) beyond those due to him in these Terms, or other rights arising from eventual disadvantages connected with the installation irrespective of the legal grounds. This exclusion of liability shall not apply in cases of intent, gross negligence on the part of the owner or executive, as well as culpable breach of substantial contractual obligations. The exclusion of liability shall furthermore not apply to cases in which according to the Production Liability Act liability for personal injury or material damages to privately used objects due to installation defects is mandatory. It shall also not apply to the omission of guaranteed promises meant to guard the purchaser precisely against an eventual damage.

(4)

We shall only be liable – except in the cases of intent and gross negligence on the part of the owner or executive – for damages reasonably foreseeable and of standard contractual stipulation if we are in breach of substantial contractual obligations.

§ 9 Purchaser IndemnityThe purchaser himself shall assume responsibility for damages ensuing if through a fault not attributable to us the devices or tools ordered by the purchaser are damaged or lost at the installation site. Conversely the purchaser shall become liable for damages to us regardless of fault, if he does not ensure that the devices or tools provided by us are stored in secure rooms/buildings, unless we or our employees act with intent or gross negligence. The purchaser shall also be liable for damages if he infringes his obligations in giving technical aid and support. Damages arising from normal wear shall remain excluded.

§ 10 Statute of LimitationsAll purchaser claims arising from this contract – whatever the legal grounds – shall become statute-barred within 12 months. The statute of limitations shall commence at acceptance or the point in time at which acceptance is deemed observed. The statutory periods shall apply for claims for damages according to § 8 Item (3).

§ 11 Final Clause(1)

All disputes arising from this contractual relationship shall be settled under the jurisdiction of the Municipal Court Lemgo/District Court Detmold, in whose district our firm is seated. We shall however be entitled to sue in the court having jurisdiction over the purchaser and the subject matter.

(2)

These business Terms and all legal relations between us and the purchaser shall be governed by the law of the Federal Republic of Germany. The UN commercial regulations (CISG) shall be – as far as they should be applied in connection with other agreements – excluded in advance.

§ 12 Annex(1)

Installation Costs, Clearing Rates

Hourly rate excluding VAT for

Mechanic Euro,

Foreman Euro,

Mechanical engineer Euro,

Processing engineer Euro.

The following overtime premiums shall be added to the above rates:

25 %:

Mondays to Thursdays over 8.5 hours up to a total working time of 10.5 hours daily.

Fridays over 6 hours up to a total working time of 8 hours.

Saturdays for the first 2 hours.

50 %:

Mondays to Thursdays over 10.5 hours, Fridays over 8 hours and Saturdays over 2 hours.

70 %:

Sundays from 6:00 am to 6:00 am the following working day.

150 %

January 1st, Easter Friday, May 1st, Pentacost Sunday, as well as December 25th.

100 %:

Work done on all other holidays.

Should work not be possible on legal holidays in the country in which the installation is being carried out, and such holidays fall on a working day, the hours of work lost shall be invoiced as regular hours. Travelling time (excluding car trips) shall be invoiced in hours without overtime premiums. If a member of the service staff drives a car either provided by his firm or privately, standard surcharges shall be added to the foregoing rates for overtime. Normal working hours shall be from Monday through Thursday, each 8.5 hours and Fridays, 6 hours = 40 hours a week. Special arrangements shall be agreed with us if due to special operating conditions different working hours must be upheld. Hours worked on Saturdays shall be considered as overtime. Night hours shall be from 8:00 pm to 6:00 am. Regulations for legal holidays shall be in accordance with the local law at the installation site. Should work not be possible on legal holidays in the country in which the installation is being carried out, and such holidays fall on a working day, the hours of work lost shall be invoiced as regular hours.

The time worked shall also be invoiced on a daily basis should our service staff not be able to work during normal daily working hours due to short time or for other reasons beyond our influence. We shall invoice delivered material such as electrodes, panels etc as required.

(2)

Daily Allowances and Travelling Expenses

(2.1)

Daily Allowance

Hotel, board and allowance shall be invoiced per calendar day on a flat-rate basis.

Daily allowance incl. overnight accommodation Euro

This amount includes hotel accommodation at a flat-rate of Euro

Hotel expenses exceeding said flate-rate shall be additionally invoiced to the purchaser to the amount exceeding on presentation of a receipt.

The daily allowance shall also be paid for days off such as on Saturdays, Sundays and legal holidays, when work is not being done, should they fall within the installation period.

So far as the purchaser assumes the expenses for accommodation and board he shall also pay a daily allowance of Euros.

Hotel accommodations which compare to a good European standard shall be provided in all cases.

(2.2)

Travelling Expenses

Expenditures actually incurred for public transportation by a mechanic for himself, his tools and his baggage shall be charged.

For the use of our vehicles there shall be a charge per kilometer of (car) Euro

Mounting conditions