General terms of business and delivery conditions (AGB)

(last updated February 2006)

1 Scope of Application

Our delivery conditions apply to all orders on the basis of which we provide services to the customer, in particular in relation to purchase contracts and contracts for the provision of goods and services. These terms and conditions take precedence over any differing terms and conditions of the customer.

2 Conclusion of the contract

Our offers are subject to change without notice. We may accept orders at our discretion within 2 weeks by sending out an order confirmation or by sending the customer the goods ordered or performing the service within this time period. Amendments or additions to written contracts are only valid if in writing. Our employees, with the exception of those with unlimited authority to represent the company, such as managing directors and managers with commercial power of attorney, are not authorized to make verbal collateral agreements or provide verbal assurances which go beyond the contents of the written contract.

3 Prices

(1)	Unless stated to the contrary in the order confirmation our prices are quoted ex works, exclusive of packaging, shipping and insurance.
(2)	Prices are quoted exclusive of applicable value added tax.
(3)	If by agreement or for reasons that lie with the customer delivery occurs more than 3 months after the date of concluding the contract, Cosateq is permitted to increase its prices, provided that this price increase reflects changes in price-determining factors which occurred after the date of concluding the contract and could not have been foreseen; this applies in particular to regular tariff increases and increases in the prices of materials. The price increase must be justified by the change in the price determinants and the customer must be provided with a suitable notice of the price increase.

4 Payments

(1)	Unless otherwise agreed the price is payable promptly after receipt of the invoice.
(2)	The timeliness or otherwise of a payment is determined by the date of receipt by us, e.g. the date at which our account is credited.
(3)	Interest is charged at normal commercial rates on payment demands for payments in arrears.
(4)	The customer only has a right of offset and a right to retain or withhold payment if his own claims are uncontested, are backed by a non-appealable court judgement or have been accepted by us. Section 7 para. 4 remains reserved.

5 Delivery time, delay

(1)	Adherence to our delivery obligations is conditional on the customer duly fulfilling his own obligations in good time.
(2)	In the event of force majeure or other unforeseen, exceptional circumstances with no fault on Cosateqs part “ e.g. problems in the supply of materials, factory stoppages, strike, lock-out, transport interruptions, government intervention, energy supply problems“ even if suffered by a supplier“ the delivery time will be extended by an appropriate period if we are prevented from fulfilling our obligations on time. If it becomes impossible or unreasonable to provide delivery or perform the service as a result of the above circumstances, we are released from our delivery obligations. If the delay in delivery is longer than 2 months, the customer is entitled to withdraw from the contract. If the delivery deadline is extended or if we are released from our delivery obligations, the customer is not entitled to claim compensation for damages. We may only invoke the circumstances set out above if we notify the customer promptly.
(3)	If we do not fulfil our delivery obligations on time, the customer is entitled to compensation for the delay equal to 30% of the fee for that part of the delivery which could not be used in accordance with the contract as a result of the delay. Section 8 applies to claims for further damages for delay and to claims for damages in lieu of the provision of the service.

6 Packaging, transport

The costs of packaging and transport are payable by the customer. We only arrange insurance if this is explicitly requested by the customer. The costs are the responsibility of the customer. The risk passes to the customer once the completed consignment has been brought for dispatch or collected. This applies even if carriage paid delivery has been agreed. The foregoing provisions also apply if the goods are sent directly to the customer from another location. However, in this case the transport costs may not exceed those which would have arisen in the event of dispatch from our premises.

7 Liability for defects

(1)	The customer must notify us in writing of any defects, in the case of evident defects promptly after receipt or in the case of other defects promptly after their discovery. This applies analogously to services performed in remedy of a defect in accordance with paragraph 2 below.
(2)	If there is a defect the customer has a right to remedy of the defect. This shall consist at our discretion in the repair or elimination of the defect or the delivery of defect-free goods. If the remedy is unsuccessful, the customer may at his own discretion reduce the price or, provided the defect does not involve a building service, withdraw from the contract. In accordance with the statutory provisions we are only obliged to deliver defect-free goods for the purposes of remedying a defect against return of the defective goods. We may refuse to remedy a defect in accordance with Art. 439 (3) of the German Civil Code (BGB).
(3)	The liability for defects does not apply to the elimination of defects that differ only insignificantly from the agreed conditions, which affect use of the item only minimally or which are caused by normal wear and tear, external effects or errors in operation by the customer. The customer's right to the remedy of defects is null and void if the customer alters the item himself or has it altered by others and this gives rise to defects or hinders the elimination of the defects.
(4)	The right of the customer to withhold payment due to a defect is limited to an amount commensurate with the nature of the defect.
(5)	Section 8 applies to claims for damages for defects.
(6)	The customer only has a legal right of recourse against us to the extent that the customer has not made any agreements above and beyond the statutory warranty rights with his own customers. This provision applies analogously to the extent of the customer's right of recourse against us.
(7)	Claims for defects expire 12 months after delivery. This does not apply to claims to which longer limitation periods apply by law in accordance with Arts 438 (1) 2, 479 (1) and 634a (1) 2 of the German Civil Code (BGB) or to claims for damages for malicious or grossly negligent infringement of important duties or for physical injury or injury to health or life.

8 Limitation of liability

(1)	Our liability for damages “ for whatever reason, and in particular for infringements of contractual duties or for unauthorized actions “ is excluded, unless such liability is explicitly provided for in these terms and conditions or separately acknowledged by us. This liability is null and void in the event of the customer making any changes to the product.
(2)	We are liable a) in full for malicious action or gross negligence; for losses or damage from physical injury or injury to health and life caused by the negligent infringement of duties; for liability in accordance with product liability laws; in the event of the issue of a guarantee; b) according to the merits of the case in the event of impossibility of performance or culpable infringement of a significant contractual duty in a manner jeopardizing the contract purpose.
(3)	In the cases set out in paragraph 2 b) liability is limited to the compensation of the probable loss typical for such contracts.
(4)	If the customer has a right to assert claims under this provision, these expire at the end of the limitation period applicable to defects set out in Section 7 paragraph 7. This does not apply to claims arising from unauthorized actions which are not based on defects in the object or service delivered.

9 Reservation of title

(1)	We reserve title in the goods supplied until all payments due in respect of the transaction have been received.
(2)	Any remodelling or processing of the supplied goods by the customer confers rights in the processed or remodelled objects on us. If the supplied goods are processed with other goods not belonging to us, we acquire co-ownership of the resultant object in proportion to the value of the goods supplied to the other processed goods at the date of processing.
(3)	If the supplied goods are combined with other goods not belonging to us, we acquire co-ownership of the new object in proportion to the value of the supplied goods to the other goods at the date of combining them. If the customer's goods can be regarded as the main goods, the customer must grant us proportionate co-ownership.
(4)	If the customer is a reseller, he is permitted to carry out normal commercial reselling activities on condition that he assigns all receivables from reselling including all accessory rights to us up to the level of the amounts we have invoiced him for.
(5)	In the event of insolvency proceedings being initiated against the customer, we are entitled to withdraw from the contract. This also applies to deliveries or partial deliveries which have not yet been paid by the customer.
(6)	We undertake to release the collateral pledged to us at our discretion at the customer's request where its realizable value exceeds the secured claims by more than 20%.
(7)	If we use the inverted bill procedure for payments our reservation of title expires only when the purchaser has encashed the bill endorsed by us at its expiry date.

10 Extended right of lien over movable goods

If we perform our services on the basis of a contract for services, as a result of our claims arising from the contract we hold a right of lien over any objects belonging to the customer which come into our possession as a result of the order. This right of lien may also be asserted for other claims arising from the business relationship. If the objects are not collected within 4 weeks of their collection being requested, we may charge a reasonable storage fee after the expiry of this period. If the objects are not collected within 3 months of a request for collection, the obligation to continue storage as well as any liability for accidental damage or destruction of the object ceases. A warning of intended sale must be sent to the customer one month before expiry of this period. After the expiry of this period we are entitled to sell the objects at their market value in order to recover our claims. Any additional revenues earned over and above our claims must be repaid to the customer.

11 Place of fulfilment, court of jurisdiction, applicable law

(1)

The place of fulfilment is our registered offices.

(2)

If the customer is registered in the Commercial Register as a business proprietor or is a legal entity under public law or a public special fund, the court of jurisdiction shall be Wangen. The same applies if the customer does not have a general court of jurisdiction within Germany or the customer moves his normal place of residence outside the Federal Republic after signing the contract or his normal place of residence is not known at the date of the legal action being taken. Each party to the contract may take legal action against the other at its general court of jurisdiction. This contract shall be construed exclusively in accordance with German law.