GTC

MTS GmbH General Sales, Supply and Payments Terms

Sec. 1 Scope of application; defence clause

1. Our below General Sales, Supply and Payments Terms (GSSPTs) shall be applicable to entrepreneurs pursuant to sec. 14 of the German Civil Code [BGB – Bürgerliches Gesetzbuch], bodies corporate organised under German public law and German public-law special funds. They shall also be applicable to any and all future transactions with these business partners.

2. Our General Sales, Supply and Payments Terms shall be applicable to all our deliveries and services.

3. Unless individual regulations were agreed upon with regard to concrete transactions, our General Sales, Supply and Payments Terms shall exclusively apply. We do not recognise any contrary or deviating terms and conditions of our contractual partners, unless we expressly and in writing agreed to them being applicable. Our General Sales, Supply and Payments Terms shall also apply in the case where we, in spite of being aware of the contractual partner’s contrary or deviating terms and conditions, provide our services subject to no conditions.

4. The German version shall be authoritative regarding General Sales, Supply and Payments Terms interpretation also in the case where our contractual partner was provided with a foreign language version.

Sec. 2 Offer; contract conclusion; offer documents

1. Our commercial offers shall be non-binding, unless we determine a period within which acceptance is required.

2. Our contractual partner shall be bound by their purchase order for a period of 21 days, that is, we may accept purchase orders within a period of 21 days after receiving such purchase orders with binding effect on our contractual partner. Provided that our contractual partner determined longer acceptance periods, such longer periods shall apply.

3. The contents of the contract shall depend on our written order confirmation and/or our written commercial offer, provided that the contractual partner accepts such offer in writing subject to no conditions whatsoever. Should the contractual partner subsequently request any supplements or amendments, we must expressly confirm them in writing for them to be included in the contract. This shall particularly apply to the supply of additional parts and the provision of additional services. Our employees have no right to make any verbal ancillary agreements with legally binding effect.

4. We reserve both ownership rights and copyrights with regard to any cost estimates, illustrations, calculations, samples and other items and documents. If we did not expressly consent to this, they must neither be reproduced nor be disclosed to any third parties; this shall also be applicable to any written documents which we identified as being “confidential”.

Sec. 3 Prices; price adjustments

1. Supplies and services for which no fixed prices were expressly agreed upon shall be invoiced at the prices which apply on the day of delivery or performance.

2. Unless the order confirmation provides otherwise, our prices shall be considered “ex works” prices (ex works pursuant to the Incoterms 2000), exclusive of packaging costs. Our prices do not include statutory value-added tax; provided that the supplies or services are subject to value-added tax, this will be separately indicated and charged to the amount applicable on the day of invoicing.

3. In the case where procurement costs undergo considerable changes after we submitted our commercial offer or after the contract was concluded and where such changes are beyond our control (e.g. due to increases in material and delivery costs, customs, exchange rate fluctuations), we shall have the right to request reasonable price adjustments on the condition that we timely inform our contractual partner about this prior to the delivery or service performance.

Sec. 4 Payments; payment terms; offsetting; right to retention; our rights with regard to our payments claims being at risk

1. Unless the order confirmation provides otherwise, the price agreed upon shall be due for payment within ten (10) working days (exclusive of Saturdays) after the goods were delivered or the services were provided; timely payment depends on the time we receive the payment. With regard to purchase orders with a value of more than € 20,000.00, we shall have a right to down payments of one third of the invoice value (including value-added tax) which becomes due for payment upon contract conclusion (receipt of the order confirmation/acceptance of our offer subject to no conditions).

2. Deduction of discounts shall be excluded if this was not previously agreed upon.

3. We shall be entitled to request our contractual partner to pay interest amounting to five per cent of the outstanding invoice amount from the due date, also if they are not in arrears. If the legal requirements concerning default of payment apply, we shall be entitled to request default interest to the amount of eight percentage points above the relevant basic interest rate pursuant to sec. 247 of the German Civil Code on the outstanding invoice amount.

Our contractual partner shall be considered to be in arrears:

provided that a payment term was agreed upon:

– from the day following the day on which the payment period terminated (e.g. the payment period provided for under the MTS order confirmation, the MTS commercial offer or the payment terms pursuant to sec. 4

para. 1 of our GSSPTs). At the latest, our contractual partner shall be in default of payment once our payment claim has become due for payment and our contractual partner
– either receives a written warning (default shall commence on the day when the warning is delivered)
– or received an invoice and failed to settle such invoice within 30 days (without receiving a reminder).

Subject to other reasons for default pursuant to the law, default of payment shall apply with immediate effect
– if our contractual partner seriously and permanently refuses to render the services they are obliged to perform (without the delivery of a warning).

The legal consequences of delayed or failed acceptance of the supply items shall depend on sec. 6 of our GSSPTs.

4. Our contractual partner shall have a right to offset their own payment claims against payment claims to which we are entitled only if their payment claim was legally determined by a court or if we do not object to this. Only to the extent that their counterclaim is based on the same contractual relationship shall our contractual partner have a right to retention pursuant to sec. 273 of the German Civil Code.

5. We expressly reserve the right to reject cheques or drafts as a means of payment. In the case where we accept a cheque as a means of payment, the payment claim against our contractual partner shall be considered to be satisfied only if and to the extent that the relevant amount was finally credited to us subject to no reversal debit (acceptance “on account of performance”). Any cheque payment charges and/or draft fees shall be borne by our contractual partner.

6. If we and our contractual partner agreed that the latter shall be obliged to open a documentary letter of credit with their own bank or with any other bank we accept, such letter of credit must be opened in compliance with the applicable Uniform Customs and Practice for Documentary Credits (currently, revised version of 1993, ICC publication no. 500). The letter of credit must be opened in a way that it is irrevocable and divisible.

7. We conclude a contract based on the credit standing of our contractual partner. In the case where we hear of circumstances giving reason to believe that the contractual partner will be unable to fulfil the payment obligations they accepted (e.g. due to applying for the institution of insolvency proceedings; over-indebtedness; inability to pay; suspension of payments; unsuccessful attempt of compulsory execution), we may request them to pay the full purchase price prior to delivery or service provision or to provide a collateral security subject to indexation. Should our contractual partner fail to meet this request within a reasonable period, we shall have the right to withdraw from the contract. We expressly reserve additional rights.

Sec. 5 Delivery periods; delivery delays; impossibility of delivery

1. Unless otherwise provided, contractual delivery periods shall commence upon contract conclusion. However, for delivery deadlines and periods to begin, all prior commercial and technical issues must have been clarified and the purchaser must have timely and ordinarily completed all the contractual obligations imposed on them, that is, they must have made contractual down payments or submitted required authorisations, releases and/or documents.

2.a) Without having expressly agreed upon a fixed date or a fixed period, any information concerning delivery periods are approximate values.

b) Delivery periods/times are met if we hand over the supply items to the person commissioned with the shipment at the relevant time and/or at the end of the relevant period or if we are able to show that we timely indicated that the supply item was ready for delivery on the relevant date.

c) The delivery periods shall be extended by a reasonable period, also in the absence of express agreements, in the case of subsequent contractual changes impacting on the delivery periods.

d) With force majeure events or the occurrence of unforeseeable obstacles which we are unable to avoid in spite of taking reasonable care considering the circumstances of the individual case, the delivery deadlines shall be extended by the prevention period and a reasonable start-up period. The circumstances listed below as examples, without being limited to this, lead to the above delivery period extension on the condition that we are not responsible for this and that this does not interfere with timely production and/or delivery in the concrete case: interference of domestic and foreign authorities; false or delayed supply of carrier vehicles, important raw materials, construction substances, other materials or trading goods; energy failure; natural disasters (storm; hail; floods; fire etc.); strikes; lawful lockouts; operational disruptions or operational restrictions, also with sub-suppliers. We shall not be responsible for the fault of our suppliers.

e) We shall be obliged to indicate to our contractual partner the existence of a force majeure event, the occurrence of an unforeseeable obstacle and, once this is foreseeable, the presumed duration of prevention from contractual performance.

f) As a result of temporary prevention from performance for the above reasons, our contractual partner may withdraw from the contract only if waiting until the presumed lapse of the obstacle would question the purpose of the transaction and if it is not acceptable for them and on the condition that they previously provided us with a reasonable period for subsequent performance under penalty of refusal to perform. Withdrawal must be declared in writing.

g) Should performance on our part, on a permanent basis, be rendered considerably more difficult due to force majeure or unforeseeable events of the type referred to above, we shall be exempted from our duty to perform. In this case, our contractual partner may withdraw from the contract on the condition that they previously established a reasonable period for subsequent performance under penalty of refusal to perform. Any additional claims of our contractual partner, in particular a claim for damages due to non-performance or defective performance, shall be excluded, unless there is evidence showing that we or any of our executives acted on a wilfully intentional or grossly negligent way.

3. Should we be obliged to pay damages to our contractual partner due to delayed delivery, our contractual partner shall be obliged to show, in each individual case, that they incurred damage for delay; we accept no lump-sum damage claims in this regard. The amount of damages due to delayed delivery we are obliged to pay shall be limited to 0.5% per week of delay or a part thereof and to the maximum total of 5% of the value of the delivery which cannot be used on time or for the contractual purpose as a consequence of the delay.

4. Should fulfilment of our delivery duty become impossible, e.g. because the delivery item was destroyed or stolen prior to being handed over to the forwarding company and/or prior to notification of readiness for delivery, we shall be exempted from your delivery duty. Our liability for damages pursuant to sec. 10 shall be limited in the case where we are responsible for making delivery impossible.

Sec. 6 Our rights with non-acceptance and/or delayed acceptance

1. Should our contractual partner fail to accept the delivery item on the contractual delivery date without us being in any way responsible for this, the contract price related to the delivery (including value-added tax) shall be due for payment from the contractual partner receiving the notification of readiness for delivery and/or being requested to pick up to goods; the risk shall be transferred to our contractual partner at the same time (sec. 7 no. 2). If non-acceptance is based on our contractual partner’s fault, we shall be entitled to request lump-sum compensation for any costs resulting from non-acceptance. Such compensation shall amount to 1% of the net contract total per week of non-acceptance or a part thereof (including, but not limited to, for storage costs, funding costs) until the delivery is accepted or the contract is dissolved. Our contractual partner shall have a right to show that we incurred no damage at all or that damage we incurred is lower than the relevant lump sum. We, on our part, shall be entitled to show that we actually incurred damage exceeding the amount of the lump sum.

2. In the event of non-acceptance, we may also set a reasonable acceptance period for our contractual partner. If this period ended without success, we shall be entitled to withdraw from the contract. Once we withdrew from the contract and if non-acceptance is based on our contractual partner’s fault, we shall be entitled to request damages in the form of 35% of the net contractual sum when purchasing a new suction excavator and/or 20% of the net contract sum when purchasing a second-hand suction excavator. Our contractual partner shall have a right to show that we incurred no damage at all or that damage we incurred is lower than the relevant lump sum. We, on our part, shall be entitled to show that we actually incurred damage exceeding the amount of the lump sum.

Sec. 7 Transfer of risks; shipping; transport insurance

1. If we are responsible for shipping the goods, our contractual partner shall bear any and all transport costs. Our contractual partner shall particularly bear any and all costs related to export (e.g. charges; customs duties; tax).

2. The risk shall be transferred to our contractual partner at the time when we hand over the delivery items to the forwarder commissioned with transporting the goods; our contractual partner shall then, for example, bear the risk of delivery item destruction, damage or theft. In the event that delivery does not occur within the contractual delivery period without us being responsible for this in any way, the risk shall be transferred to our contractual partner from the contractual partner receiving the notification of readiness for delivery and/or being requested to pick up to goods.

3. Upon our contractual partner’s request, we shall protect the delivery by purchasing transport insurance. The relevant costs shall be borne by our contractual partner. Apart from this case, we shall not be obliged to purchase transport insurance.

4. If we procure registration plates for transporting a suction excavator on our contractual partner’s behalf, we shall not be obliged in this case to purchase insurance for own damage of the vehicle, unless our contractual partner expressly requests us to do this in writing. In this case, our contractual partner shall be exclusively responsible for the existence of valid insurance protection.

Sec. 8 Retention of title to protect our claims for damages

1. Until complete payment of any and all payments claims resulting from the business relationship, including those established after contract conclusion, the goods we deliver shall remain our property. Payment shall be considered the receipt of the invoice amount on one of our bank accounts. In the event that our contractual partner violates the contract, in particular in the case of default of payment, we shall be entitled to take the goods back without this individual action representing withdrawal from the contract. However, we reserve the right to withdrawal and any additional rights based on the law.

2. Our contractual partner shall store any goods subject to retention of title on a non-paid basis. They must ensure that the goods are treated with diligence and, at their own expense, purchase sufficient insurance protection against loss and damage caused by fire, theft, vandalism and natural disasters. Upon request, they must provide us with evidence of such insurance. Any insurance claims in relation to our deliveries subject to retention of title shall be assigned to us as early as at the time of insurance contract conclusion to the amount of the payment claims charged to our contractual partner.

3. Our contractual partner shall not be entitled to use any goods under retention of title for loan securing purposes, that is, to pledge them or to transfer them to third parties by way of security. In addition, our contractual partner shall be obliged to notify us in writing, without undue delay, of any pledging or other access to the goods subject to retention of title by third parties. To the extent that third parties fail to pay compensation to us for any judicial and extra-judicial costs related to requests for releases, our contractual partner shall be liable for this.

4. For as long as the goods subject to retention of title were not fully paid, our contractual partner shall have a right to sell and process such goods in the ordinary course of the business only if they obtained our previous consent. For the purpose of protecting our property of goods subject to retention of title and the right to retention of title itself, the below restrictions shall additionally apply:

a) To the extent our contractual partner resells any goods subject to retention of title, they shall, right from the beginning, assign to us all their claims against third parties established in relation to the resale of the goods, to the amount of the final invoice value and our ancillary claims, that is, to be more precise, regardless of whether or not the goods subject to retention of title were resold prior to or after their processing. We hereby revocably authorise our contractual partner to collect payment claims also after the assignment. We shall refrain from exercising our own right to collect payment claims and revoking our contractual partner’s collection authorisation to the extent that they fulfil all of their payment duties towards us, that they are not in arrears and, in particular, that no application for the institution of insolvency proceedings concerning their assets was submitted and that they did not suspend their payments. Should any of the above apply, our contractual partner shall be obliged to notify us of all the claims they assigned and the relevant debtors, to communicate to us any additional information required for collection, to hand over any documents related to this and to inform their debtors about the assignment. Assignment shall be subject to the condition subsequent of our payment claims being settled. Our contractual partner shall not be entitled to resell goods subject to retention of title to the extent their customers excluded or restricted assignment of the payment claims established against them.

b) Processing or modification of the goods subject to retention of title always only occurs on our behalf as the producer which means that we become the direct owners of the processed or modified items. Should the purchase items be processed or modified by using any other items we do not own, we shall acquire co-ownership of the new item in the ratio of the value of the goods subject to retention of title to that of the other processed or modified items at the time of processing or modification. Should the purchase items be inseparably connected to, blended or mixed with any other items we do not own, we shall acquire co-ownership of the new item in the ratio of the value of the goods subject to retention of title (final invoice value, including value-added tax) to that of the other items at the time of connection, blending or mixing. Should our contractual partner obtain sole ownership based on connection, blending or mixing, the Parties agree, right from contract conclusion, that (co-)ownership of the unit item is transferred to us in the ratio referred to in the above sentence. Our contractual partner shall store for us any goods subject to sole ownership or co-ownership created this way on a non-paid basis.

c) We shall be obliged to release any collaterals upon our contractual partner’s request to the extent that their realisable value exceeds the value of claims to be securitised by more than 25%. We decide which collaterals we intend to release.

5. To the extent that our right to retention is not legally effective pursuant to the law of the country to which the goods might be delivered, we may request our contractual partner to provide equivalent collateral security which they must maintain until the time of final payment. Should our contractual partner fail to follow this request, we shall be entitled to request immediate payment of any claims they failed to satisfy, without consideration to payment periods possibly agreed upon or possible extension for payment.

6. To the extent we are the recipients of goods, we object to applicability of retention of title in favour of our supplier possibly provided for in their general terms and conditions.

Sec. 9 Product quality; warranty; defect notification; limitation of warranty claims

1. Certain features of our products shall be considered to be warranted and/or guaranteed only if this is expressly stated in the contract. Information included in the operating manuals we provide only represent recommendations. Compliance with such recommendations cannot be indicated as a reason for material defects.

Without a certain intended purpose being expressly indicated in writing, our contractual partner shall solely bear the risk of technical and economic usability of our products, e.g. the risk of fitness for admission by public authorities in other countries.

Our contractual partner shall have a right to assert warranty claims due to any defects only if they produce evidence showing that the defect they claim to exist has already existed at the time of risk transfer.

For this reason, we are particularly not liable

– for product defects which are based on improper commissioning, operation or use or on improper maintenance works or assembly by our contractual partner or by third parties in violation of our respective instructions. Also, we are not liable for damage resulting from improper operation of a suction excavator by personnel who is unable to show that they participated in our training courses;

– for ordinary wear and tear;

– for chemical, electric or electro-chemical influence on our products, the reasons of which are beyond our control.

2. For our contractual partner’s warranty claims to be valid, they must fulfil their commercial defect notification and inspections duties. Defects must be notified to us within the periods referred to in the following:

– within three weeks from the time of shipping in the event of defects which are apparent or which could have been determined in the context of ordinary income goods inspections which includes product usage tests on a sample basis;

– within two weeks after determining defects which were impossible to be determined in the context of ordinary incoming goods inspections (as provided above).

3. Provided that our contractual partner fulfilled their inspection and defect notification duties and that our deliveries are defective, we shall have a duty and a right, at our choice, to remove the existing defect or to supply a replacement product.

For the purpose of determining the reasons for the defect and for performing rectification works or making replacement deliveries, our contractual partner must grant us an opportunity and a reasonable period of time. Our contractual partner must immediately inform us if waiting for subsequent performance by us would pose a threat to operational safety or if this would result in disproportionately large damage.

Subsequent performance generally occurs at the registered office of our company. In this case, our contractual partner must, at their expense, deliver to and pick up the vehicle or vehicle part from the registered office of our company. With regard to subsequent performance costs, we shall only bear the costs of the replacement part and the installation costs directly related to the defective part, including the costs of providing our assembly workers.

Should subsequent performance fail or should we refuse to subsequently perform in spite of us being obliged to this pursuant to the law, our contractual partner shall be entitled to withdraw from the contract in compliance with the law or reduce the contractual price. They may assert claims for damages to the extent referred to under sec. 10 on the condition that the relevant requirements were met.

As a general rule, subsequent performance is deemed to have failed after four unsuccessful attempts of removing the defect.

4. We are not obliged to subsequently perform in the case where performance is impossible or unacceptable for us due to unreasonable efforts pursuant to sec. 275 para. 2 of the German Civil Code. To the extent our General Sales, Supply and Payments Terms contain no provisions in this regard, the legal provisions shall apply.

5. If we are entitled to any warranty claims against any upstream suppliers, we shall have the right to assign such warranty rights to our contractual partner.

In this case, our warranty liability shall be limited to the extent to which our contractual partner is unable to hold themselves harmless with our upstream suppliers even after they instituted and completed court proceedings. Limitation of the claims asserted against us shall be suspended during the period in which our contractual partner and the upstream supplier negotiate and/or have a legal dispute.

6. Our contractual partner shall have no right to subsequently perform, reduce the purchase price or withdraw from the contract

· if defects can be attributed to items or products which our contractual partner had originally supplied;
· if our contractual partner requests a certain type of contract execution in spite of us having informed them about the risk of the product being susceptible to errors as a consequence of this;
· if they purchase second-hand machines from us.

The above limits of liability shall not apply if we maliciously concealed or guaranteed the final product to be free from the defect in question.

7. Our liability for compensation for damage resulting from any product defects shall depend on sec. 10 of the Terms.

8. The period of limitations for warrant claims shall be one year from the legal start of the limitation period.

Should we subsequently perform in any way, the above limitation period shall re-commence only for those claims which are related to the same defect or to consequences from defective subsequent performance.

Even in the case where we subsequently perform (subsequent improvement; subsequent delivery), we do not accept warranty claim of our contractual partner asserted against us (with the consequence of the limitation period to start again), unless we expressly state in writing to accept this.

The legal provisions concerning limitation shall be applicable to liability for the lack of guaranteed features, to liability for wilful intention, gross negligence or malicious intent and to claims for damage resulting from injuries to life, limb or health; this shall also apply to claims under the German Product Liability Act [Produkthaftungsgesetz].

Sec. 10 Liability for damages

1. With regard to warranty claims asserted against us, in particular claims for compensation due to direct damage (including loss of earnings) or due to indirect damage (property damage) and other consequential damage, irrespective of the legal reason on which such claims are based (impossibility to perform; non-fulfilment; culpability upon contract conclusion; positive violation of a contractual duty or tort), we shall be liable only

· in the case of wilful intention;
· in the case of gross negligence on the part of our company organs or executive managers;
· in the case of culpable injuries to life, limb or health;
· in the case of defects we maliciously conceal or which we guaranteed to not exist;
· in the case of defects with the delivery items to the extent liability is provided for under the German Product Liability Act for personal injuries and property damage with items used for private purposes.

With culpable violation of important duties which result from the type of the contract and which must be fulfilled to not pose a threat to the contractual purpose (important contract duty), we shall be liable also for gross negligence on the part of non-executive employees and for cases of slight negligence, but, in the case of the latter, limited to damage which is typical of the relevant contract and which can be reasonably foreseen.

2. To the extent to which our liability is excluded or limited, this shall also be applicable to personal liability of our vicarious agents.

Sec. 11 Written form requirement

To the extent these General Sales, Supply and Payments Terms request that declarations must be made in writing, transmission by telefax, telegram or e-mail shall be sufficient for compliance with the required form.

Sec. 12 Place of fulfilment; place of jurisdiction; applicable law

1. The place of fulfilment for any and all obligations and services under the contract relationship shall be our registered office (Germersheim).

2. The place of jurisdiction for all types of dispute, including summary proceedings entirely based on documentary evidence and actions for assertion of a claim concerning payment of a cheque, shall be our registered office (Germersheim). However, we reserve the right to bring an action against our contractual partner also with courts which would have jurisdiction without an agreement on the place of jurisdiction.

3. Material law of the Federal Republic of Germany shall be exclusively applicable to the legal relationship with our contractual partner, with the United Nations Convention on Contracts for the International Sale of Goods and the German laws of conflict not being applicable.

MTS GmbH General Sales, Supply and Payments Terms
Version dated March 2010