ROFRA’s General Terms and Conditions of Business

Updated 01.04.2007

1. Extent of Validity

The terms and conditions of payment and supply listed below apply to the entirety of the business conducted between ROFRA GmbH and the customer, whether or not they are reiterated in connection with future orders.They also apply when the customer appeals to his or her own terms and conditions of business, except in cases where ROFRA GmbH has explicitly accepted such terms.

The TERMS are valid solely and exclusively in respect of sole traders and legal entities within the meaning of public legislation or a local or national public authority as per § 310 section 1 of the BGB (Germany civil code).

2. Conclusion of contract

Price Quotations are not binding on ROFRA GmbH.No contract of supply and purchase exists before confirmation of order or goods are supplied as ordered.

3. Period for supply and delivery

Unless otherwise agreed, the period for supply and delivery commences at the time the confirmation of order is sent.The deadline is deemed to have been met if a “ready-for-dispatch” notice has been sent or the goods to be supplied have left the ROFRA works by the relevant date.

The period for supply and delivery will be extended in instances of industrial dispute, particularly strikes and lockouts, or if difficulties arise which are beyond ROFRA’s control – such as disruptions to operations or delays in supply of essential raw materials – where such difficulties can be shown to have a significant effect on supply and delivery of the goods ordered.This applies also to suppliers of ROFRA GmbH.The period for supply and delivery will be extended commensurately with the duration of the industrial action or difficulties.ROFRA GmbH has no obligation to make representations concerning such instances if they arise during a delay which has already been announced.ROFRA will notify the customer of the beginning and end of the difficulties as soon as possible.

Within the period for supply and delivery, part-orders may be supplied by ROFRA as long as such will not be significantly impair the usability of the goods.

If orders are made on a customer call off basis, the call-offs must be made on time to permit regular production and supply; at least six weeks before the desired date of delivery unless other fixed dates have been previously agreed.Call off orders must be go through within 12 months of the original order unless other fixed dates have been agreed.If, after or at the agreed intervals, the call-off is not made or is made only in part, the customer is in arrears of acceptance.Acceptance of the goods ordered is a primary obligation on the part of the customer.

4. Scope of delivery

The scope of delivery is established with ROFRA’s confirmation of order.The fulfilment of order may be up to 10% short or 10% in excess; the exact figure will be invoiced.

ROFRA reserves the right to incorporate design or shape improvements due to the state of the technological art or to statutory provisions, as long as there is thus no significant modification to the goofs as ordered and any changes are deemed to be reasonable for the customer.

Insofar as tooling based on the customer’s drawings and specifications is required for the production, no rights in respect of the tools created accrue to the customer.

ROFRA reserves the copyright in respect of all documentation, such as drawings and calculations, which are lodged with the customer on his or her confirming the commission.Third parties may not be given access to such documents unless ROFRA expressly authorises the customer, in writing, to give such access.

5. Cancellation charges

If the customer reneges on the contract without justification, ROFRA is permitted to charge 10% of the net selling price (calculated on te minimum acceptance quantity) to cover the administrative costs of the order and loss of profits, and this not withstanding any option to demand fulfilment of contract or to establish a claim fo higher actual damages.The customer retains the right to prove lesser actual damages.

6. Packing and dispatch

Packaging passes into the ownership of the customer and is charged for.Details of dimensions and weight given by ROFRA are given to the best of our knowledge.No guarantee of exactitude is given.Unless otherwise agreed, postage or transport charges and packing expenses will be invoiced to the customer.Packaging materials and transport materials in accordance with German packaging regulations will not be taken back. It is for the customer to dispose of them at his or her own expense.

7. Acceptance, transfer of risk

The customer is under an obligation to accept the goods to be supplied, within 14 days of notice being served that they are ready for dispatch.If terms of the actual delivery have not been expressly agreed, transfer of risk takes place at the site of the ROFRA factory which received the commission.

The customer is under an obligation to check the goods for any faults within 14 days of receipt.

If the customer is in arrears of acceptance of goods formally ordered, ROFRA is entitled to withdraw from the contract , first having extended the acceptance period by 14 days, and to demand compensation for non-fulfilment.The extension of the acceptance period by 14 days will not be a requirement if the customer makes serious difficulties about acceptance or refuses outright or will clearly be unable to pay even within the extra 14 days.

If the goods are dispatched at the behest of the customer, the risk of accidental loss or of accidental impairment of quality passes to the customer on dispatch; at the latest, when the goods leave the works or the store.This in no way depends on whether the dispatch is from the place of manufacture or on who is bearing the costs of the transport.If the customer states that he or she is not going to accept the goods, the risk of accidental loss or of accidental impairment of quality passes to the customer at the time of his or her refusal.

8. Price changes

Prices are permitted to change if the interval between conclusion of the order and agreed date of supply is longer than six weeks.If wages, material costs or the standard retail price rises, ROFRA reserves the right to raise its price to the customer to reflect the increased costs or the later increase in value added.Evidence of such increases will be given to the customer.The customer is only entitled to withdraw from the contract if the price increase is more than an insignificant increase over the general increase in the cost of living which has taken place in the period between the formal order and the supply.

9. Guarantee

The quality of ROFRA products matches the currently valid fault evaluation lists published by Editio Cantor.The customer is expressly warned that the goods supplied may contain a certain proportion of faulty items.In confirming his or her order, the customer is declaring acceptance of the limits set for the proportion of faulty items, and readiness to accept the goods, as long as the permitted limits are not exceeded.Goods supplied by ROFRA are defective if they do not match the agreed acceptance quality levels.If non has be agreed, the goods are defective if they are unsuitable for the use to be assumed from the nature of the contract, and otherwise if they are not suitable for their customary use.An insignificant reduction in value or suitability for the use to be assumed from the nature of the contract or for customary use does not constitute a defect.

The costumer is und an obligation to examine the goods supplied by ROFRA for any departure from the quality standard immediately on arrival and to notify ROFRA of any defects found.Any obvious defects must be claimed for within 14 days of arrival at the latest.Any defects not at first obvious must be reported immediately they are discovered.For commercial operators within the meaning of the German code of commercial law (HGB), § 377 of the HGB applies.

If there is a defect in any goods supplied, ROFRA has the option of replacing the goods or remedying the defect.It is ROFRA’s obligation to bear the costs of any transport, journeys, labour and materials which arise, as long as the costs are not increased by the fact that the goods have been returned to a site other than that where the original contract was fulfilled.

Should the remedy or replacement fails, is unreasonable to expect of ROFRA, is refused by ROFRA or has not taken place within a period of at least three weeks set by the customer, the customer will be entitled to chose between withdrawing from the contract or reducing the purchase price.The only conditions under which claims for damages may be made against ROFRA by the customer on account of the defect are listed in the following liability clauses.

Exclusion of liability does not apply to cases in which any defect in the goods supplied offends against the German law on product liability respecting damage to life and limb or property caused by products for personal use.The period of guarantee in which remedy, replacement, withdrawal or price reduction can be claimed is one year from the time of transfer of risk.[If the defect is due to deliberate or grossly negligent breach of contractual obligations, or has caused damage to life and limb or health, the period of guarantee in which damages on account of the defect may be claimed is two years; in all other cases one year from transfer of risk.]Any claims in respect of defects lapse unless made within a year of transfer of risk.

10. Liability for breach of contractual obligations

If ROFRA breaches its contractual obligations, the customer may, with the exception of defective goods being supplied, withdraw from the contract and claim damages only when period set by the customer in which the contractual obligations are to be fulfilled, which must be at least two weeks, has elapsed without ROFRA’s having met those obligations.

ROFRA is liable in respect of breaches of contractual obligation (arrears, infeasibility, defects, breach of subsidiary contractual obligations) only if the breach is due to deliberate or grossly negligent action, unless the breach is substantial.

In so far as ROFRA is liable for actual damage as a result of deliberate or grossly negligent breach of a contractual obligation or of culpable breach of substantial contractual obligation, ROFRA’s liability will be limited to the foreseeable damage typical in the case of such contracts, and at most to the limit set under ROFRA GmbH’s general liability insurance policy.If ROFRA’s general liability insurers fail to meet acclaim in whole or in part, ROFRA will be liable only to a maximum equivalent to the sum insured.

The liability limits described above will not apply in cases of damage to life and limb or health.

Where the liability of ROFRA GmbH is excluded or limited, such limitations will also apply to the personal liability of ROFRA’s waged and salaried employees, agents and assistants in the fulfilment of the contract.

None of these clauses affect the provisions of the law concerning burden of proof.

11. Reservation as to ownership

The goods supplied by ROFRA remain ROFRA’s property until paid for in full.If the customer goes either wholly or partially into arrears of payment in settlement of ROFRA’s claims, ROFRA is entitled upon the unproductive lapse of a reasonable period for payment to withdraw from the contract and to demand return of the goods supplied if they have passed into the possession of the customer.The customer will be under an obligation to list the remaining goods supplied and to permit access to them at any time.

The customer is, moreover, or entitled to continue selling the goods supplied in the ordinary way but shall transfer to ROFRA all rights to payments received in a sum equivalent to the purchase price (including VAT) agreed contractually between ROFRA and the customer, quite independently of whether the goods supplied have been sold on before or after further processing.If the monies due to the customer are being paid into a current account, the right to the balance (up to the value of ROFRA’s claims) will be ceded to ROFRA, with priority over any other claims on the balance.

The customer is hereby empowered to continue to take in such payments due after the right to them has been transferred.ROFRA’s authority to take in the payments itself is unaffected by the foregoing clause; ROFRA does, however, agree not to take in the payments as long as the customer continues properly to fulfil his or her payment obligations and is not in arrears.Should this, however, be the case, ROFRA may demand that the customer gives ROFRA details of the payments due (to which the rights have been transferred) and of the debtors, together with all details necessary to the calling in of the payments, and passes over the relevant documentation and informs the third party debtors of the transferred rights.

The customer shall bear all costs associated with the calling in of payments from third parties or the return of the goods.

The processing or modification by the customer of the goods supplied will always be for and on behalf of ROFRA GmbH.If the goods supplied are combined for processing with other items not belonging to ROFRA, ROFRA will become owner of the altered goods in the ratio that the goods supplied had to the altered goods at the time the alteration was made.

If the goods supplied are combined for processing with other items not belonging to ROFRA, ROFRA will become owner of the altered goods in the ratio that the value of the goods supplied had to the goods in combined form.The customer shall defend ROFRA’s share of the ownership.

The customer may neither pawn the goods supplied nor give them as security.In the case of seizure or distraint or other disposal by third parties, the customer shall inform ROFRA immediately and provide ROFRA with all information and documentation necessary to the protection of ROFRA’s rights.Enforcement officers or other third parties shall be informed of ROFRA’s ownership.

If so requested by the customer, ROFRA will agree to relinquish its control of that element of securities to which it is entitled which is more than 20 % in excess of the value of the debts due to ROFRA, covered by the securities, and not yet settled.

12. Conditions of payment

The purchase price and compensation for incidental expenses are, unless otherwise formally agreed, due for payment on transfer of the goods supplied.

Any checks or bills of exchange are valid payment only upon being cashed.There will be no acceptance of bills of exchange without ROFRA’s prior written agreement.The bank charges on bills of exchange will be calculated.These charges must be paid immediately in cash.Unless otherwise arranged in the confirmation of order, the purchase price is due for payment net without deductions within 30 days, and with a 2% discount within 14 days, of the date of invoice.Partial invoices will be issued for partial supply.The general laws and statutes will apply in the case of arrears of payment.The legally applicable interest on arrears will be calculated at 10% p.a. above the current base rate of the European Central Bank unless ROFRA can show that costs of the arrears justify a higher interest rate.

The customer may only offset his or her claims for payment from ROFRA against those of ROFRA from him or her if such are undisputed by ROFRA or have been established in law.The same applies to any claim on the part of the customer to withhold monies or goods.

13. Place for hearings, law to be applied

If any disputes arise from the contractual relationship with the customer, the claim is to made at the court within whose jurisdiction ROFRA’s head office falls.ROFRA also has the right to lodge a plaint at the court which has jurisdiction for the customer's registered office.

Federal German legislation shall apply without exception; legislation in respect of international sale of moveable goods is explicitly excluded, even if the customer’s head office is outside Germany.

14. Miscellaneous

No transfer of the customer’s rights and obligations under the contract entered into with ROFRA will be valid without ROFRA’s written agreement.

If any of the above terms and conditions is or becomes ineffective, the validity of the remaining terms remains unaffected.

Cursdort, March 2007


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