General Terms of Delivery and Payment for Refractory Products
of SAINT-GOBAIN IndustrieKeramik Rödental GmbH
Date 1.12.2003

I.     SCOPE

1. The following Terms of Delivery alone shall be regarded as agreed upon for all deliveries, services, all quotations, acknowledgements of order and related statements between us, i.e. SAINT-GOBAIN IndustrieKeramik Rödental GmbH (hereinafter also referred to as Seller), and the Buyer/Customer (hereinafter referred to as Customer) also in the course of negotiations, even without explicit mention. Only the Terms of Delivery valid at the point of time when the quotation is drawn up shall apply. Our Terms of Delivery shall apply for all contracts with enterprises, legal persons under public law and public service special funds, also for all future business relations, even if not explicitly agreed on once more. They shall be regarded as accepted at the latest on the acceptance of the goods.
2. Conflicting terms or terms diverging from our terms on the part of the Customer are hereby objected to; they shall only apply if they have been explicitly recognised by us in writing for each individual transaction.
3. The right to effect standard technical and design modifications to the goods supplied is hereby reserved, insofar as they do not unreasonably interfere with the Customer and insofar as they do not impair the fitness for use of the purchased goods.
4. Claims by the Customer arising from the contractual relationship cannot be assigned without our authorisation.
5. If in individual cases provisions different from the Terms of Delivery should be applicable, or if one provision should be ineffective in full or in part, this shall not affect the effectiveness of the remaining part of the provision or the effectiveness of the other provisions. The invalid provision shall be replaced by another provision likely to achieve the purpose of the ineffective provision. Verbal statements, in particular information, recommendations and advice, must be repeated in writing for them to become effective. This also applies for the abolition of the written form requirement.

II.    QUOTATIONS AND CONCLUSIONS OF CONTRACTS

1. Our quotations are always to be regarded as without engagement, i.e. only as requests to submit a quotation. The Customer shall be bound by his order for 30 days. The order shall be accepted by a written acknowledgement of order or by the execution of the order.
2. The buyer shall accept and pay for surplus pieces produced for technical reasons or because of the danger of breakages, as follows: generally up to 10% of the quantity ordered per item; if these are difficult shaped parts, or if fewer than 100 pieces of each item are ordered, the surplus shipment to be accepted and to be paid for by the purchaser may also exceed 10% within a reasonable and fair framework.

III.    DELIVERY

1. Statements of delivery dates are approximate and are not binding, unless their binding force has been explicitly guaranteed. Preconditions for the run of the period of delivery are the clarification of all execution details as well as the provision by the Customer of the drawings, models, samples and materials to be procured.
2. The delivery period has been adhered to if the goods to be delivered have left the factory by the expiry of this period or the customer has been notified that the goods are ready for shipment.
3. The delivery period shall be reasonably extended in cases of force majeure, i.e. if circumstances and events cannot be prevented with the due care and diligence of prudent management, or in the event of stoppages (e.g. strikes, lockouts etc.) and in the event of all other circumstances for which we are not responsible (such as defective or delayed self-delivery, failure of the upstream supplier, traffic delays etc.), regardless of whether these occur in our factory or in the factory of our suppliers. Such cases shall suspend the contractual obligations of the parties for the duration of the disturbance and to the extent of its effect. If cases of force majeure should make fulfilment of the contract appear unacceptable, both parties to the Contract are entitled to withdraw from the contract with respect to the scope of performance affected. No other claims can be accepted.
4. In the event of a delay in delivery the customer can withdraw from the contract after a reasonable but fruitless extension period has expired; in the event that our performance should be impossible, he is entitled to this right even without an extension period. A delay in delivery is identical to impossibility of performance if delivery is not effected for more than one month. Notwithstanding Sections 5. and 6., no claims for damages can be accepted; the same also applies for repayment of expenses.
5. The disclaimer of liability regulated in Section 4. shall not apply if a liability disclaimer or limitation has been agreed for damages arising from harm to life, body or health based on an intentional or negligent obligation of the Seller or of a legal representative or vicarious agent of the Seller; nor shall it apply if a liability disclaimer or limitation has been agreed for other damages based on an intentional or grossly negligent violation of the duties of the Seller or of a legal representative or vicarious agent of the Seller. Should we culpably violate a substantial contractual obligation or a "cardinal obligation", liability is restricted to contractually typical predictable damage. The above shall apply mutatis mutandis in the event of repayment of expenses.
6. The limitations on liability arising from Sections 4. and 5. shall not apply if a commercial fixed-date transaction has been agreed or if the Customer can assert that he is no longer interested in the performance of the contract on account of the delay for which we are responsible.
7. Part-shipments are permissible insofar as the Customer can reasonably be expected to accept this. Acceptance of the shipment cannot be refused because of the absence of individual parts of a shipment or because of minor complaints, unless such absence or complaints unreasonably prejudice the fitness for use of the goods.
8. Shipment and transport of the goods shall be effected for the account and at the risk of the Customer, so that on transfer to the transporting agent in particular the transport and breakage risk passes to the Customer. Freight shipments are carriage forward, packaging shall be charged at cost. Postal consignments shall be sent to the addressee post paid and packaging paid. Not included in this are repair jobs and possible customer services, for which postage and freight are always charged. Delivered goods, even if they have slight defects, shall be accepted by the Customer, notwithstanding his rights arising from Section VII.

IV.    PACKAGING

1. Insofar as the goods are delivered on returnable pallets, the purchaser must return the same number of equivalent returnable pallets in equivalent condition stage by stage as replacements. If correct replacement does not take place, the purchaser is obliged to pay the following additional charges: EUR 10.00 plus VAT for each (EUR) flat pallet and EUR 75.00 plus VAT for each (EUR) box pallet.
2. In order to keep selling prices as stable as possible, the costs for recording and recycling used packaging is not included in the delivery prices. The purchaser shall therefore utilise used packaging himself and for his own account in accordance with statutory and official requirements. Cost debiting and invoice deductions by the purchaser are not permissible.

V.      PRICES AND TERMS OF PAYMENT

1. Unless otherwise agreed, calculations shall be effected on the basis of the agreed unit prices. Prices do not include delivery or packing charges, or statutory value added tax at the rate currently applicable at the time of delivery.
2. Freight costs shall be calculated on the basis of the actual weight of the goods, plus packing.
3. If a significant change that was unforeseeable at the time the contract was signed should occur with respect to material prices, wage costs, freight rates, energy costs, turnover and traffic taxes or custom duties, and if this change should be beyond the sphere of influence of SGIK, the agreed price shall be increased to a reasonable measure, but at the most by 15% of the agreed gross price.
4. The invoice amounts are due within 10 days of the invoice date with 2 % cash discount from the net goods value, but at the latest 30 days after the invoice date, without deductions, and are payable net cash. Repairs and other services are due 30 days after the invoice date without deductions and are payable net cash. In the event of delayed or deferred payment, we are entitled to claim interest at normal banking rates as well as commission.
5. With part-shipments, each shipment can be invoiced separately.
6. Eligible bills of exchange and cheques shall only be accepted by us after prior arrangement and only on account of performance. Payment shall not be considered to have been made until one of our accounts has finally been credited with the amount of the bill or cheque. Discount, bank and collection charges as well as stamp fees shall be refunded by the customer. If the financial position of the customer should prove to be unfavourable during the term of an agreed payment by instalments or by the due date of a bill, we are entitled to demand immediate payment of the entire amount before the end of the term.
7. Payments shall always be credited against the oldest invoice. If costs and interest have already been incurred, payments shall be credited first against the costs, then against the interest and finally against the principal claims.
8. The customer is only entitled to set off sums of money if his counterclaims have been finally determined in law, are undisputed or have been recognised by us. The customer is entitled to exercise a right of retention insofar as his counterclaim is based on the same contractual relationship.
9. If the customer should get into arrears with his payments, we are entitled to charge interest on arrears in accordance with statutory provisions. Furthermore, we may prove and charge higher interest losses at any time.
10. If after conclusion of the contract we should gain knowledge of facts which in accordance with the due judgement of a prudent businessman suggest that the claim for payment is endangered by the lack of efficiency of the Customer, in particular non-compliance with the terms of payment, delays or circumstances likely to impair the creditworthiness of the Customer (e.g. information to this effect from banks or loan insurers, application for the opening of insolvency proceedings), we shall be entitled to suspend further deliveries, having set a reasonable period for the Customer to pay in advance or to provide suitable securities, until all of our claims have been met, and, in the event of refusal by the Customer, to withdraw from the contract, with the invoices for part-shipments already effected becoming due with immediate effect.

VI.    RESERVATION OF OWNERSHIP

1. All delivered goods shall remain our property until payment has been made in full of all of our present and future claims arising from the business relationship. On current account, the reserved property shall be regarded as security for the outstanding balance.
2. Subject to revocation, the Customer is entitled to sell the goods in normal business transactions. The Customer shall, with immediate effect, assign all claims and accounts receivable from the further sale as well as from any processing of the conditional commodities or on account of their loss or damage to them to the seller accepting these conditions. If the price obtained from the further sale should exceed our claim, we shall be obliged to transfer back this excess amount. Subject to revocation, the Customer is authorised to collect assigned claims. We shall make no use of our revocation rights as long as the Customer meets his contractual obligations in an adequate and orderly manner and as long as there are no doubts about the solvency of the Customer.
3. The Customer is not entitled to pledge the reserved property, to transfer it by way of security or to encumber it with other third-party rights. In the event of pledges, attachment by third parties, losses, damage or other circumstances that could have an adverse effect on the property rights or conditional commodities of the Seller, the Customer shall notify us of this without delay and provide us with all information and documents that are required for us to safeguard our rights. Third parties must be informed of our property rights.
4. If conditional commodities are connected, mixed or processed with other goods, this is always done on our behalf, without liabilities for us arising from this. We shall be the owners of the new goods created by processing, connection, mixing or other changes. The Customer hereby transfers his rights to these new goods to us, with immediate effect, and shall safeguard them for us with the care of a prudent businessman. The new goods shall be considered to be conditional commodities as defined in these Terms.
5. In the event of a delay in payment by the Customer, or if there should be doubts concerning his solvency as defined in Section V.10., we are entitled to take back the supplied goods, and the Customer is obliged to surrender the same. To do this, the Customer even now grants irrevocable access to his premises. The assertion by us of the reservation of ownership as well as the pledging by us of the delivered goods are not regarded as a withdrawal from the contract, insofar as this is not stated by us explicitly and in writing.
6. If the value of this security should exceed the amount of our claims by more than 20 %, we shall release the security at our discretion at the request of the Customer.
7. If, in the case of deliveries abroad, a reservation of ownership cannot be agreed on with the same effect as in German law, but the reservation of other rights to the goods delivered is permitted, we shall be entitled to these other rights. The Customer must cooperate here in all respects.

VII. MOULDS AND COPYRIGHT

1. The moulds required to produce the goods shall remain the intellectual and real property of the Seller, even if the Customer has borne the costs for the production of the moulds, that is, the Seller shall retain all copyrights and other protected rights as well as all rights of utilisation.
2. Insofar as the Customer has borne the production costs, the moulds shall be held in safe custody for two years, calculated from the date of the last delivery. The exclusive delivery to the Customer of products from these models and moulds must be agreed on separately and in writing.

VIII. DEFAULT IN ACCEPTANCE, TAKING BACK OF GOODS

1. If the Customer does not accept the goods after expiry of a period of grace granted to him, or if he refuses acceptance, we have the right, notwithstanding other statutory rights, to withdraw from the contract and to claim damages instead of performance, in accordance with Section VIII. 2.
2. In the event of default in acceptance, we shall charge 15 % of the order price without deductions as damages instead of performance, unless the Customer can prove that no damage whatsoever was incurred, or no damage in the amount of the standard sum was incurred. We reserve the right to prove that the damage was or is higher.
3. If we should voluntarily take back the goods supplied by us, we shall have a right to full compensation for expenditures effected as a result of the conclusion of the contract, such as transport and installation costs, as well as to a standard sum for loss of profit in the amount of 10 % of the agreed purchase price, unless the Customer can prove that no damage whatsoever was incurred, or no damage in the amount of the standard sum was incurred.

IX. WARRANTY

1. Ceramic products require specific handling. The durability of the products depends especially on adherence to the product-specific application temperatures as well as observation of the relevant temperature curves. Any statement concerning service life can therefore only be approximate. Unless we are explicitly informed of the operating conditions, product selection for a particular application is effected solely by the Customer.
2. The condition of the goods to be delivered ensues solely from the agreements reached between us and the Customer. Deviations in dimensions and weights within the framework of customary tolerances do not represent defects and do not represent any justification for complaints. Patterns and samples provided by us are solely intended as an approximate description of these goods. No agreements between us and the Customer with respect to the condition of the goods to be supplied by us, as well as our other statements with respect to the condition of these goods represent a warranty in accordance with § 443 German Civil Code, unless we have given the Customer a separate written statement in which such a warranty is explicitly granted.
3. In the event of due fulfilment of the duty on the part of the Customer to examine and to make a complaint in respect of a defect immediately on receipt of the goods in accordance with § 377 German Commercial Code, we shall grant a warranty for defects in the shipment, to the exclusion of further claims, notwithstanding the provisions of Section X, as follows:
4. If the goods are defective as a result of a circumstance occurring before the passage of risk, we are entitled to rectify the defect or to deliver goods free of defects, at our discretion (retroactive fulfilment). The discovery of such defects must be reported to us without delay in writing. To allow us to carry out all measures that may appear necessary for retroactive fulfilment, the Customer, after consultation with us, must give us the necessary time and opportunity, otherwise we are not liable for any consequences that may result. Parts that have been replaced shall become our property. We may refuse rectification of defects as long as the Customer does not meet his financial obligations towards us to the extent corresponding to the defect-free part of the goods. If the defect is only minor, the Customer is only entitled to a reduction of the purchase price.
5. If the retroactive fulfilment described in 3.1 fails, is impossible or unreasonable, or if we allow a reasonable period of time stipulated for retroactive fulfilment to lapse fruitlessly, the Customer is entitled to select between reducing the purchase price accordingly, or withdrawing from the contract in accordance with statutory provisions; In particular, this applies in the event of negligent delay and refusal to fulfil retroactively, including cases where this is unsuccessful for the second time.
6. Unless otherwise stated in the provisions under Section X, no further claims by the Customer can be accepted, for whatever legal reason (in particular claims based on negligence at the time the contract was concluded, violation of contractual primary and secondary obligations, repayment of expenses, with the exception of those incurred according to § 439 Section 2 German Civil Code, unauthorised acts as well as other tort liability); in particular, this applies to damage outside the purchased goods as well as to claims for the reimbursement of loss of profit; claims not resulting from the defectiveness of the goods are also covered. Claims based on a defect cannot be recognised if the goods were used, processed or resold in knowledge of the defect.
7. No warranty can be given for damage resulting from the following reasons: unsuitable or incorrect use and storage, faulty installation or commissioning by the Customer or by third parties, natural wear and tear, faulty or careless treatment, improper maintenance, unsuitable operating resources, defective construction work, unsuitable building site, chemical, electrochemical or electrical influences (unless the supplier is responsible for them), improper modifications or repair work carried out by the Customer or third parties, and modifications or repair work carried out without the prior permission of the supplier.
8. If through our fault the delivered goods cannot be used by the Customer for the contractually agreed purpose as a result of the omitted or faulty execution of proposals and advice given before or after the contract was concluded, or through the violation of other secondary contractual obligations – in particular instructions for the operation and maintenance of the delivered goods – the provisions of Sections IX.3 und X. shall apply accordingly, to the exclusion of further claims by the Customer.

X. LIABILITY
We shall accept liability for damage for whatever legal reason (in particular claims based on negligence at the time the contract was concluded, violation of primary and secondary contractual obligations, repayment of expenses, with the exception of those incurred according to § 439 Section 2 German Civil Code, unauthorised acts as well as other tort liability) in accordance with the provisions as laid down in IX. as well as only

a. in the event of intent,
b. in the event of gross negligence on the part of the Seller or of the owner, the organs or executive staff,
c. in the event of culpable injury to life, body, health,
d. in the event of defects which we have fraudulently concealed or whose absence we have guaranteed,
e. in the event of defects in the delivered goods, insofar as liability is accepted in accordance with the product liability law for personal injury or damage to property relating to privately used objects.

In the event of the culpable violation of essential contractual obligations we also accept liability for the gross negligence of non-executive staff and for slight negligence, limited in the latter case to contractually typical, reasonably predictable damage.
No further claims can be accepted.

XI. STATUTE OF LIMITATIONS

1. Claims by the Customer, based on the defectiveness of the delivered goods, for subsequent performance, damages and disbursement are subject to a statute of limitations of one year as of the delivery of the purchased goods. This does not apply for goods that have been used in a structure in accordance with their normal use and have caused its defectiveness; in this case, the statute of limitations is extended to 5 years. In the case of substitute deliveries and rectification of defects, the period of limitation of the claims for defects does not begin anew, and ends in accordance with the original period of limitation of the claims for defects.
2. If the period of limitation for claims for subsequent performance has expired, no claims can be accepted for a reduction of the purchase price or the exercise of a right of rescission. In this case the Customer can refuse to pay the purchase price insofar as he would be entitled to do so on account of the rescission or on account of the reduction of the purchase price. In the event of an exclusion of a right to rescission and a subsequent refusal to pay, we are entitled to withdraw from the contract.
3. Statutory time limits apply for other claims for damages not covered by Section XI.1.1.

XII. CATALOGUES, COPYRIGHT

The illustrations in our catalogues and prospectuses are not binding for the version supplied. We reserve the right at any time to modify the version supplied. We can accept no guarantee for deviations from the specified dimensions, weights etc. We reserve ownership rights and copyright to illustrations, drawings, samples or other documents. They may not be made accessible to third parties without our permission and must be returned immediately on request. The Customer is prohibited from making our technical knowledge and processes accessible to third parties, or to exploit them himself, even if these are not industrial or copyrighted property rights.

XIII. PLACE OF FULFILMENT AND JURISDICTION

The place of fulfilment for both parties is Rödental. Coburg is the place of jurisdiction for all legal disputes arising from this contractual relationship, insofar as the Customer is an entrepreneur, a legal person under public law or a public-law separate estate. This also applies to proceedings related to bills of exchange and cheques. We are also entitled to bring a legal action at the location of the main office of the Customer.
The parties agree on the exclusive applicability of the law of the Federal Republic of Germany. The uniform UN Sales Convention is not applicable.