Terms and conditions of purchase

General Terms and Conditions of Purchase
Gilles Tooling GmbH
Status July 2019

I. General
The following terms and conditions shall apply exclusively to the legal relationship between the supplier and us in the area of purchasing by us. Terms and conditions of the supplier and deviating agreements shall only apply if we have recognised them in writing. Neither our silence nor the acceptance of the service or its payment shall be deemed as acknowledgement.
The supplier has read and understood these terms and conditions of purchase. He hereby declares that he recognises them as legally binding with the written acceptance of the order or with the start of its execution.

II Conclusion of contract and contract amendments
The contract for the deliveries or services as well as any amendments, collateral agreements, declarations regarding its termination and other declarations and notifications must be made in text form, unless otherwise stipulated in these terms and conditions. If the supplier does not accept an order within five working days of receipt, we shall be entitled to cancel the order at any time.

III Scope of delivery and services / changes to the scope of delivery / spare parts / subcontractors
1. the supplier shall ensure that all data and circumstances relevant for the fulfilment of his contractual obligations, as well as the use we intend to make of his deliveries, are known to him in good time. Offers are free of charge for us. The supplier shall be responsible for ensuring that it has carefully checked the local conditions before submitting an offer and has obtained clarity by inspecting documents on the performance of the services and compliance with the technical and other regulations. The supplier must check any documents submitted, also with regard to the local conditions, for correctness, feasibility and, if applicable, the execution of preliminary work by third parties. He must inform us immediately in writing of any concerns of any kind, stating the reasons, and reach an agreement with us on the continuation of the work.
2. within the scope of reasonableness, we may demand changes to the design and execution of the delivery item from the supplier. The supplier must implement the changes within a reasonable period of time. Reasonable arrangements shall be made by mutual agreement regarding the effects, in particular with regard to additional and reduced costs and delivery dates. If no agreement is reached within a reasonable period of time, we shall decide at our reasonable discretion.
The supplier is not authorised to make any changes to the goods (in particular with regard to specifications, drawings, design, construction, time and place of delivery, packaging, quality, quantities and means of transport) without our prior written consent.
3. the supplier shall ensure that it can supply us with the goods or parts thereof as spare parts for a period of 15 years after termination of the supply relationship.
4. the supplier may only subcontract tasks incumbent upon it with our prior written consent.

IV. Delivery / Transport / Delay / Transfer of ownership
1. agreed delivery periods shall commence upon receipt of the order and shall be binding. The supplier undertakes to meet delivery dates strictly and precisely and, if necessary, to use faster means of transport at his own expense. The supplier must inform us immediately if he becomes aware of circumstances that jeopardise compliance with a delivery date.
2. if agreed deadlines are not met due to circumstances for which the supplier is responsible, we shall be entitled, at our discretion, to withdraw from the contract after expiry of a grace period set by us with a threat of rejection, to claim damages for non-performance or to have the work carried out by a third party at the partner's expense. If we do not assert the aforementioned rights, this shall not affect our claims for compensation for all additional costs and use of the damage incurred by us as a result of the delayed delivery or service for which the supplier is responsible. The acceptance of a delayed delivery or service does not constitute a waiver of claims for compensation.
As the stated delivery dates are absolute fixed dates, the supplier shall be in default without the need for a reminder.
Decisive for compliance with the delivery date or the delivery period is the receipt of the goods by us. If the supplier fails to meet delivery dates for reasons for which it is responsible and is therefore in default of delivery, we shall be entitled to demand compensation for the delay. For each full day of delay, such compensation shall amount to 2% in total but not more than 10% of the value of that part of the total delivery or the delivery lot which cannot be used on time or in accordance with the contract as a result of the delay.
The supplier shall reimburse us for all additional costs incurred as a result of the delayed delivery, such as special transport costs, production downtime costs, etc.
The agreement of a delay penalty or its assertion shall not affect any statutory claims to which we are entitled due to delay.
3. delivery items must be packed and transported in such a way that damage is excluded. The costs and damages arising from non-compliance with statutory or agreed shipping, packaging or labelling regulations shall be borne by the supplier.
4. the risk of performance and remuneration shall pass to us upon delivery to the delivery address specified by us. The supplier's advance assignment of remuneration claims against us requires our separate written consent. Unless the supplier chooses a fast mode of transport in order to meet the delivery date, the delivery shall be made using the mode of transport specified in the order. 5.
5. if the parties agree on the establishment of a security warehouse by the supplier, the supplier is
supplier is obliged to provide us with a monthly inventory report (or at any other reasonable interval to be requested by us).

V. Prices / Terms of payment
1. the agreed prices are fixed prices. Unless otherwise agreed, payment shall be made within 14 days with a 3% discount or within 30 days without deduction. The period shall commence upon receipt of the contractual performance and a proper and verifiable invoice. In the case of acceptance of premature deliveries, however, the period shall commence at the earliest on the agreed delivery date. Invoices must be submitted without carbon copies, stating the order number, order item, account assignment, unloading point, supplier number, part number, number of units and unit price as well as quantity per delivery. The supplier agrees to participate in a credit note procedure at our request.
2. in the event of delivery not in accordance with the contract, we shall be entitled to withhold payment pro rata until proper fulfilment.
(3) Payment for goods by us does not mean that the goods are deemed to have been duly recognised or accepted.
(4) The supplier is not authorised to assign claims to which he is entitled against us or to have them collected by third parties. The regulation of § 354a HGB remains unaffected.
5. The supplier shall only be entitled to offset against our claims or to assert a right of retention if and insofar as his claim is undisputed or his counterclaim is legally binding. We are also entitled to offset claims of the supplier against claims of the supplier.

VI Terms of delivery / official authorisations / export control
1. deliveries shall be made DAP (Incoterms 2010) to the place designated by us, unless otherwise specified, including packaging. Each consignment must be notified to us and to the recipient designated by us on the day of dispatch. A delivery note must be enclosed with each delivery. The delivery note must include our order number, article number and supplier number. Agreed dates and deadlines are binding. The supplier must notify us immediately in writing of any recognisable delay in its performance, stating the reasons and the expected duration of the delay. The supplier may only invoke causes of delay for which he is not responsible if he has fulfilled his duty of notification.
2. the supplier must inform us of the necessary official authorisations and reporting obligations for the import and use of the delivery items.
3. for deliveries from preferential countries, the supplier must enclose the proof of preference with each delivery. The long-term supplier's declaration in accordance with EW G-VO 1207/2001 must be submitted once a year. Furthermore, the supplier is obliged to comply with the relevant export control regulations and to inform us of the export control labelling of the delivery items, in particular in accordance with EU and US law, in writing at the latest with the delivery.

VII Acceptance of work performances
1. the acceptance of work services shall take place formally by us after completion of the work by countersigning an acceptance report. In the case of services that can no longer be checked and inspected later due to further execution, the supplier must request us in writing in good time to inspect them. A fiction of acceptance by silence in response to a request for acceptance by the supplier, by payment or by actual use is excluded.
2. the supplier shall arrange for officially prescribed acceptance tests of any kind, in particular acceptance tests by recognised experts, at its own expense prior to acceptance of the work performance, unless this service is expressly excluded from the scope of performance. Official certificates regarding the absence of defects and any official acceptances must be sent to us in good time before acceptance of the work performance.

VIII Confidentiality / Information
1. the supplier shall keep secret the information provided to him by us, such as drawings, documents, findings, samples, means of production, models, data carriers, etc., shall not make them accessible to third parties (including subcontractors) without our written consent and shall not use them for purposes other than those specified by us. This applies accordingly to reproductions. This obligation shall not apply to information which was already legitimately known to the supplier upon receipt without an obligation to maintain secrecy or which subsequently becomes legitimately known to the supplier without an obligation to maintain secrecy, which - without breach of contract by one of the parties - is or becomes generally known or for which the supplier has been granted written authorisation for other use. The supplier may not advertise its business relationship with us without our prior written consent.
2. we reserve ownership and all other rights (e.g. copyrights) to the information provided by us. Reproductions may only be made with our prior written consent. The reproductions shall become our property upon their production. It is hereby agreed between the supplier and us that the supplier shall store the reproductions for us. The supplier shall carefully store, maintain and insure the documents and objects made available to him as well as reproductions thereof at his own expense and return or destroy them at our request at any time. He shall have no right of retention for any reason whatsoever. The complete return or destruction must be assured in writing.
(3) In the event of a breach of the obligations under Section VIII. 1, a contractual penalty of € 25,000 shall be payable immediately for each case of infringement. The supplier reserves the right to have the appropriateness of the amount of the contractual penalty determined by a court. Any contractual penalties paid shall be offset against claims for damages.

IX. Quality management
1. the supplier shall constantly monitor the quality of its services. Prior to the respective delivery of the delivery items, the supplier shall ensure that the delivery items intended for delivery are free of defects and comply with the agreed technical requirements and assure us of this in writing.
2. the supplier shall provide us with quality records upon request. Quality records are documents and other data relating to specific requirements and the performance of the supplier's own quality system.

X. Warranty / Liability for defects / Reimbursement of expenses / Deadline / Indemnification
1. the supplier warrants that the goods are free from defects in accordance with the applicable law and, in particular, that the goods are suitable for the use stipulated in the contract. Furthermore, the supplier warrants that the goods fulfil all laws and regulations applicable to them in the relevant sales markets.
2. we shall only carry out an incoming goods inspection with regard to externally recognisable damage and externally recognisable deviations in identity and quantity. We shall give notice of such defects immediately. Furthermore, we shall give notice of defects as soon as they are detected in the ordinary course of business. In this respect, the supplier waives the defence of delayed notification of defects.
3. if the delivery item is defective, our claims shall be governed by the statutory provisions, unless otherwise stated in the following provisions. If operational safety is jeopardised, if there is a risk of unusually high damage or in order to
maintain our ability to deliver to our customers, we may, after informing the supplier, carry out the rectification ourselves or have it carried out by third parties. Any costs incurred as a result shall be borne by the supplier.
(4) If the supplier utilises third parties in the provision of services, he shall be liable for these as for vicarious agents.
(5) Unless a longer limitation period is stipulated by law, the supplier shall be liable for defects that occur within 60 months of receipt of the delivery by us or of acceptance (if such is stipulated by law or contract). In the event of subsequent fulfilment, the period shall be extended by the time during which the delivery item cannot be used in accordance with the contract. The same deadlines apply to subsequent fulfilment. The limitation period for claims due to defects shall commence at the earliest two months after the end customer's claims have been fulfilled, but shall end at the latest 7 years after delivery to us. 6.
6. the supplier shall indemnify us against any existing claims of third parties in the event of defects of title, unless the supplier is not responsible for the defect of title. The supplier shall indemnify us against third-party claims based on product liability if and to the extent that the damage was caused by a defect in the delivery item supplied by the supplier. The claim for indemnification shall apply insofar as the supplier itself would be directly liable. In the case of fault-based liability, the obligation to indemnify shall only apply if the supplier is at fault.
7. if the supplier delivers defective goods and we therefore carry out a return inspection
legal provisions or in coordination with the authorities, we carry out a recall of products in which the
the goods in question have been installed, the supplier shall indemnify us and the affiliated companies
companies from all liabilities, costs, damages, losses, claims and expenses (including legal
and expenses (including legal and prosecution costs) arising from or in connection with the recall.
or are attributable to the recall action. When deciding whether to carry out such a
decision to carry out such a recall action, we must exercise our discretion
and take the interests of the supplier into account appropriately.
8. rejects or shortages caused by coating will not be accepted. The costs for components which cannot be reworked without essential component properties and/or functions no longer being fulfilled shall be borne in full by the supplier.

XI Warranty for "zero kilometre failures"
Complaints fall under 0-km failures
- In our incoming goods department
- During the further processing of semi-finished products
- On the assembly line or during the functional test after installation
1. we prepare an inspection report/notification of defects with the expenses incurred, in the preparation of which the supplier can participate. If the defect cannot be rectified by reworking, we will return the rejected parts (including the test report) to the supplier with a process-related and expense-based calculation of the costs incurred.
- Effective, process-related costs for reworking and lost processing by us or a third party (time required x costs of the work unit x quantity). In this context, lost processing is understood as the costs actually incurred by us or a third party due to the production costs of the defective part and does not include any compensation for lost profit.
- Administration and handling fee of EUR 50.00 excl. VAT per test report.

XII Warranty for field failures
Field failures are defects in products that have left our production facility.
1. we send the defective parts to the supplier. The supplier shall inspect the parts and inform us of the result in writing. If necessary, we will carry out an independent inspection or participate in the supplier's inspection. If the supplier does not submit an inspection report within 5 working days of receipt of the defective parts, the supplier recognises the defectiveness of the parts in question.
- Effective, process-related expenditure for reworking and lost processing by us or a third party (time required x costs of the work unit x quantity). In this context, lost processing is understood as the costs actually incurred by us or a third party as a result of the production assembly work for the defective part and does not include any compensation for lost profit.
- Administration and handling fee of EUR 50.00 excl. VAT per test report.

XIII Warranty for serial damage
Serial damages are accumulations of warranty claims which are exclusively the responsibility of the supplier.
1. the supplier undertakes to provide qualitatively flawless parts as quickly as possible.
2. if parts have to be replaced as part of a preventive customer service measure (including recall), the supplier shall indemnify us against all net warranty costs incurred, provided that the fault is exclusively within the supplier's area of responsibility. This also applies to the period prior to the resolution of such a customer service measure in which corresponding parts were replaced due to the same cause of damage.
If a comprehensive replacement action is not possible due to limited parts availability, this billing method also applies to repairs in the event of customer complaints in individual cases. In the run-up to any preventive customer service measure, the supplier has the right to participate in an advisory capacity in the decision-making process that may directly or indirectly affect the supplier's warranty obligation.
Net warranty costs are calculated as follows:
- Replacement costs of the cancelled scope of delivery
- Country-specific labour costs, in particular dismantling and installation
- Country-specific customs, handling, packaging and freight costs
- Our internal processing and handling costs

XIV Late damage, goodwill
1. late damages are individual and serial damages occurring after expiry of the warranty. Cases of goodwill occur when we have to grant goodwill outside the regular warranty period for market reasons.
2. if we and our customer consider a recall action to be necessary because this is stipulated by the applicable jurisdiction or legislation with regard to product liability and assuming that we can prove that such a recall action was triggered by the supplier due to damage to the product, the supplier shall be held liable for all claims and must assume all liability claims for us, including the recall actions of the end customer due to the product from the supplier. The supplier must also indemnify us and defend us against liability claims from third parties.
The correctness of such recall costs may only be proven by invoices and account statements charged to us by the end customer.

XV Insurance
1. the supplier shall, at its own expense, take out business and product liability insurance and motor vehicle
and product liability insurance as well as motor vehicle recall cost insurance to an appropriate extent customary in the industry (with a sum insured of at least EUR 50 million for liability and EUR 10 million for recall) with a reputable and solvent insurance company, which covers the supplier's liability towards us and third parties to the extent necessary.
of the supplier towards us and third parties to the required extent. The sum insured must be doubled for the USA and Canada. The supplier must provide us with proof of the existence and scope of cover of these insurance policies at any time and without delay upon request.
2. the existence of an insurance contract shall not lead to a restriction of the supplier's obligations arising from
obligations of the supplier arising from these Terms and Conditions of Purchase.

XVI Execution of work on our premises
1. the supplier must follow the instructions of the plant security.
2. the supplier is prohibited from using persons employed by us or who have been employed by us during the last 6 months to fulfil his contractual obligations on our premises without our prior written consent.

XVII Provision of materials
Materials, parts, containers, special packaging, tools, measuring equipment or similar provided by us (provisions) shall remain our property. In the event of processing, combining or mixing of materials provided by us, we shall acquire co-ownership of the new product in the ratio of the value of the materials provided to the value of the overall product. The supplier shall not be entitled to a right of retention, for whatever reason, to the materials provided.

XVIII Tools
Notwithstanding any agreements to the contrary, we shall receive full or co-ownership to the extent that we participate in the proven costs for tools for the manufacture of the delivery item. The tools shall become our (co-)property upon payment. They shall remain with the supplier on loan. The supplier is only authorised to actually or legally dispose of the tools, to relocate them or to render them permanently inoperable with our approval. The tools shall be labelled by the supplier as our (co-)property. The supplier shall bear the costs for the maintenance, repair and replacement of the tools. Replacement tools shall be our property in proportion to our share of the original tool. In the event of co-ownership of a tool, we shall have a right of first refusal to the supplier's co-ownership share. The supplier must use tools that are (co-)owned by us exclusively for the manufacture of the delivery items. Upon termination of the delivery, the supplier must return the tools to us immediately upon request. In the case of tools in co-ownership, we must reimburse the supplier for the current value of the supplier's co-ownership share after receipt of the tool. The supplier shall not be entitled to a right of retention under any circumstances. The obligation to surrender shall also apply to the supplier in the event of an application for insolvency against him or in the event of a longer-term interruption of supply. The supplier shall insure the tool to the agreed extent and, if no agreement has been made, to the usual extent.

XIX Software
Insofar as the scope of delivery includes non-standardised software, the supplier agrees for a period of 5 years from delivery of the delivery item to make changes/improvements to the software according to our specifications against reasonable reimbursement of costs.
costs. If the software originates from upstream suppliers, the supplier shall oblige them accordingly.

XX. Force majeure / longer-term delivery hindrances
1. natural disasters, riots, official measures and other unforeseeable and unavoidable events (force majeure) shall release the supplier and us from our performance obligations for the duration of the disruption and to the extent of its effect. The affected party must immediately inform the other contractual partner comprehensively and do everything within reason to limit the effects of such events. The affected party must inform the other contractual partner immediately of the end of the disruption.
2. in the event of a longer-term hindrance to delivery, suspension of payments or the opening of insolvency proceedings, the refusal to open such proceedings for lack of assets or the initiation of comparable proceedings against one of the contractual partners, the other contractual partner shall be entitled to withdraw from the contract with regard to the part not yet fulfilled. If the supplier is affected by one of the aforementioned events, he shall support us to the best of his ability in relocating the production of the delivery item to us or a third party, including the licensing of industrial property rights necessary for production under conditions customary in the industry.

XXI Compliance with anti-corruption and antitrust law
1. the Supplier warrants that it will not commit any acts or omissions which, irrespective of the form of participation, may lead to regulatory or criminal sanctions, in particular for corruption or violation of antitrust and competition law, by the Supplier, by persons employed by the Supplier or by third parties commissioned by the Supplier (hereinafter referred to as "Violation" or "Violations"). The Supplier is responsible for taking appropriate measures to avoid Violations. To this end, the Supplier shall in particular oblige the persons employed by it or third parties commissioned by it accordingly.
accordingly.
2. the supplier undertakes, upon written request from the customer, to provide information on the aforementioned measures, in particular on their content and implementation status. The Supplier undertakes, at the written request of the Customer, to answer a questionnaire provided by the Customer for the purposes of self-disclosure completely and truthfully once every three calendar years and to provide the Customer with related documents.
3. the Supplier shall inform the Customer immediately of the initiation of official investigation proceedings due to an offence. In addition, the customer shall be entitled to request information in writing about the infringement and the measures taken to remedy and prevent it in the future if there are indications of an infringement by the supplier.
4. in the event of an infringement, the customer shall be entitled to demand that the supplier immediately cease and desist and to demand compensation for all damages incurred by the customer as a result of the infringement.

XXII General provisions
1. the place of fulfilment for deliveries and services is the destination specified by us.
2. the contractual relationship shall be governed by German law (with the express exclusion of IPR and the UN Convention on Contracts for the International Sale of Goods).
exclusive place of jurisdiction. However, we are also entitled to sue the supplier at another competent court.
3. should a provision be or become invalid, this shall not affect the validity of the other provisions.