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TERMS AND CONDITIONS OF PURCHASING

(as of May 1, 2019)

1. Scope

1.1 These Terms and Conditions of Purchasing shall apply for the duration of the business relationship between KRUG GmbH - IKRU (hereafter referred to as “KRUG”) and the supplier for all goods and services to be provided by the supplier. They shall also apply to all future business transactions with the supplier.

1.2 These Terms and Conditions of Purchasing shall form the basis of all business transactions with the supplier. They shall apply to entrepreneurs, legal entities under public law and public-law special funds.

1.3 These Terms and Conditions of Purchasing shall apply exclusively; opposing or deviating terms and conditions issued by the supplier shall not be accepted unless KRUG explicitly consents to their application in writing.

1.4 KRUG is entitled to change the provisions with effect for the future at any time by notifying the supplier accordingly.

2. Offers

2.1 Offers by suppliers shall be assumed as offers for the conclusion of a contract exclusively under KRUG's Terms and Conditions of Purchasing. Offers have to be prepared in German or English. Unless otherwise agreed in writing, the supplier undertakes to maintain the offer for six weeks from the date the offer was made.

2.2 Offers and cost estimates have to be binding and are to be provided free of charge for KRUG

3. Orders / Prices

3.1 Agreements and orders shall only be binding for KRUG if made in writing or confirmed in writing after being made verbally or by telephone.

3.2 No rights can be derived against KRUG from orders, information, promises, etc. that have been made verbally or by telephone. Such declarations shall only be binding if they are confirmed by KRUG in writing or if there is proof that KRUG has waived the written form requirement.

3.3 All prices quoted in the supplier's offers shall be deemed fixed prices. Unless otherwise agreed in writing, all prices are quoted free works, delivered duty paid (DDP) (Incoterms 2010), including packaging, plus the value added tax applicable at the time.

3.4 If the price has not been precisely stated at the time the order is made by KRUG, the price must be quoted by the supplier upon order confirmation at the latest.

4. Order Confirmations / Invoices / Delivery Notes

Order confirmations and invoices must be submitted to KRUG in writing or text form (e.g. email, fax); they must not be enclosed with the goods. Delivery notes must be enclosed with the goods. In addition to the precise description of the scope of delivery according to article, type and quantity, order numbers and purchasers in particular must be indicated on all documents.

5. Terms of Payment

5.1 The period allowed for payment shall commence upon delivery, however, at the earliest upon receipt of a proper invoice but not before the agreed delivery date. If no specific payment term has been agreed in writing, payment shall be made either within 14 days less a 3% discount or within 30 days net. Payment shall be made subject to invoice verification.

5.2 Exercising any right of retention of title declared by the supplier shall only be possible in the event of prior withdrawal from the contract.

6. Delivery / Delay

6.1 Dates agreed for delivery and service performance shall be binding for the supplier. Delivery dates shall be understood to represent the date of receipt of the delivery at the delivery address specified by KRUG.

6.2 If it is foreseeable that the delivery cannot be made on time, the supplier shall immediately notify KRUG in writing or text form of this matter, indicating the reasons as well as the expected delivery time. If this notification is omitted or delayed, the supplier shall be liable for any delays and their consequences.

6.3 If the supplier is in delay with the delivery/service performance, KRUG shall be entitled to withhold an amount of 0.2% – but no more than 5% in total – of the value of the total order amount as a compensation for each commenced working day of delay (known as penalty for breach of contract). The supplier is entitled to prove to KRUG that no damage, or considerably less damage, has been caused for KRUG. This does not affect KRUG's claim for performance of the contract and further damages.

6.4 KRUG shall be entitled to offset a corresponding penalty for breach of contract against claims of the supplier.

6.5 Each delivery must be accompanied by the necessary shipping documents.

6.6 In case of incomplete or incorrect shipping documents or shipping documents arriving late, the supplier shall bear the resulting consequences.

6.7 Deliveries shall be made free of charge to delivery address, including proper packaging.

7. Release from Acceptance Obligations

In the event that KRUG is prevented from accepting the delivery item due to labor disputes or force majeure, KRUG shall be released from its obligation to accept delivery on the agreed date.

8. Transfer of Risk

In the case of sale by dispatch to destination, the risk of loss of the delivery/service shall pass to KRUG after delivery to the agreed delivery address. In the case of a contract for work and materials, the risk shall remain with the supplier until complete acceptance of all services by KRUG.

9. Delivery Quantities

The supplier shall only be permitted to deliver the quantity ordered by KRUG. KRUG shall only accept different quantities if this has been agreed explicitly in writing. The supplier undertakes to provide all necessary shipping documents in good time at his own expense. If the acceptance of the delivery depends on a complete documentation, KRUG shall not be in default of acceptance if the relevant documents have not been submitted granting a reasonable period of time for verification.

10. Partial Deliveries

In the case of partial deliveries of a contractually agreed service, the service will not be deemed performed by the supplier until it has been delivered in full. The supplier shall bear the additional costs incurred by partial deliveries with regard to transport, packaging, etc. In each case, partial deliveries are not to be regarded as a separate business deal. Any claims KRUG may have with regard to any contractually agreed performance shall not be affected by partial deliveries, in particular not with regard to liability for material defects. In the case of call-off orders the supplier shall be obliged to make any quantity released available in such a way that he can meet the delivery date as a fixed date.

11. Quality

If certain qualities or quality classes have been agreed with regard to the provision of performance, they shall be considered the agreed quality.

12. Tools / Documents / Drawings

The supplier undertakes to treat any tools, testing equipment, documents, plans, samples, drawings, data storage devices, etc. that he receives from KRUG for the purpose of executing the order with all due care and confidentiality. He shall not acquire any right of retention whatsoever in them. He may only make them available to third parties for use in accordance with the contract.

13. Liability for Material Defects

13.1 The supplier shall guarantee that all deliveries comply with the contract and with all other statutory provisions and guidelines in force at the time of delivery and that they incorporate state-of-the-art technology.

13.2 The period of liability for material defects shall be two years, beginning with commissioning or final technical acceptance of the delivery by KRUG or in case of deliveries where commissioning or final technical acceptance is not intended with the day of the delivery.

13.3 In case of deliveries where KRUG purchases goods for resale, the period of liability for material defects shall commence with the day of commissioning or final technical acceptance by the end customer. In case of deliveries where KRUG purchases goods for resale, the period of liability for material defects shall commence with the day of delivery at the end customer's site. However, it shall end no later than three years after delivery to the delivery address specified in the contract.

13.4 In case of defective delivery, KRUG shall be entitled to assert the claims to which he is legally entitled at his discretion within the period of liability for material defects.

13.5 KRUG shall be entitled to withdraw from the contract and claim damages instead of (the entire) performance even if there are only minor deviations from the agreed quality or if usability is only impaired to a minor extent.

13.6 Costs resulting from defective delivery of the subject of agreement, in particular in the area of transport, travel and labor costs, shall be borne by the supplier.

13.7 The period of liability for material defects shall be suspended between notification of the defect and its rectification or until possible refusal by the supplier to fulfil the claims for material defects. For parts to be replaced or reworked, this period shall commence again with the restoration of the goods to a condition where they are free of defects and usable in accordance with the contract.

13.8 By accepting or using the service, KRUG does not waive the claims specified in advance.

13.9 Upon delivery of the products, KRUG shall immediately examine, within the ordinary course of business, if they correspond to the ordered quantity and type and if there is any apparent damage resulting from their transport or any other visible defect. KRUG shall not have any further examination duties.

14. Product Liability

If a claim is made against KRUG by a third party on the basis of product liability, due to a defect in the subject of agreement delivered by the supplier, the supplier undertakes to indemnify KRUG from all such claims and to bear all related costs and expenses including, but not limited to, the costs of any legal proceedings. Apart from that, statutory provisions apply.

15. Property Rights of Third Parties

The supplier guarantees that the delivery is free of third party industrial property rights, and the supplier undertakes to indemnify KRUG from any claims for damages and costs arising from non-compliance with this guarantee commitment or from the prohibition of use of the delivered goods by third parties. Claims for such defects shall become time-barred after ten years after delivery.

16. Confidentiality

The supplier undertakes to maintain secrecy with regard to all commercial documents, financial and technical data, in particular samples or models (information), which become known during the term of the contract. KRUG undertakes to maintain secrecy to the same extent. The obligation shall commence with the first time of knowledge and continue for 36 months after the end of the business relationship. The obligation shall be waived if the information was publicly known or generally accessible or if there is proof that the third party was already aware of it; furthermore, if a party was obliged to disclose the information by virtue of statutory provisions or official administrative order.

17. Place of Jurisdiction / Applicable Law

17.1 Place of jurisdiction is the registered office of KRUG. KRUG, however, is also entitled to initiate legal proceedings against the supplier at any other place of jurisdiction.

17.2 This agreement is governed by the laws of the Federal Republic of Germany under exclusion of the provisions of the United Nations Convention on Contracts for the International Sale of Goods (CISG).

18. Final Provisions

18.1 Ancillary verbal agreements shall only apply if they are confirmed in writing or text form.

18.2 Should any part of these Terms and Conditions of Purchasing be or become invalid, the validity and enforceability of the remaining provisions shall not be affected. The parties undertake to agree jointly on a substitute provision which is effective, enforceable for the purpose of the order and suitable for the protection of mutual interests. Section 139 of the German Civil Code (BGB) does not apply.