General Terms and Conditions of Neschen AG

§ 1 General Issues – Scope

1.The following terms and conditions (hereinafter referred to as the “Terms and Conditions“) shall apply to all current and future business relations with the Customer.

2.For the purposes of the Terms and Conditions, a ”Customers“ shall be any natural person with whom a business relationship is entered into without the purpose of the business being attributable to the Consumer‘s trade or independent professional activities. An “Entrepreneur“ shall be any person or entity or partnership vested with legal capacity with whom a business relationship is entered into which forms part of the exercise of a trade or independent profession. The term ”Customers“ (singular: Customer) shall include both Consumers and Entrepreneurs.

3.Any deviating, conflicting or supplementary terms and conditions of the Customer – even if brought to Neschen’s knowledge – shall not become part of the contract unless their validity is explicitly agreed in writing.

4.We have assigned our claims as part of an ongoing factoring contract to EUROFACTOR AG, Bajuwarenring 3, D-82041 Oberhaching near Munich or PO Box 1107, D-82032 Deisenhofen. All responsibility for the product shall nevertheless remain solely with Neschen AG. Any product responsibility of EUROFACTOR AG is excluded.

§ 2 Conclusion of Contract

1.Our offers are always without engagement. Technical modifications and changes in form, colour and / or weight are reserved, as far as they are reasonable. This applies also to the printing quality from printer profiles provided.

2.By placing an order, the Customer makes a binding declaration of his intention to purchase the goods ordered. We shall be entitled to accept the contract offer which the order comprises within two weeks of receipt thereof. The offer may be accepted either in writing (including by invoice or delivery note) or by delivering the goods to the customer.

3.If the Consumer orders any goods electronically, we will confirm receipt of the order immediately. Confirmation of receipt of the order does not constitute a binding acceptance of the placed order yet. Confirmation of receipt may be combined with the acceptance of the order. When the order is placed by electronic means, the text of the contract will be stored and sent to the Customer upon request, together with the present Terms and Conditions, by e-mail.

4.We are constantly striving to effect delivery as quickly as possible. There are no scheduled terms of delivery. If in deviation from this a delivery date has been fixed, in case of any delay the Customer shall specify a reasonable period of usually four weeks for subsequent delivery. The contract shall be concluded subject to proper and timely delivery by our suppliers. This applies only to the case that we are not responsible for non-delivery and a congruent covering transaction is concluded with our supplier. In case of longterm unavailability of the goods or services, the Customer will be informed immediately. The payment will be refunded immediately.

§ 3 Force Majeure

Force majeure of any kind whatsoever, including unforeseeable disruption of production, traffic or shipping, fire, floods, unforeseeable shortages of labour, energy, raw or auxiliary materials, strikes, lockouts, orders by governmental authorities or other obstacles beyond the control of the debtor party which reduce, delay, prevent or render unreasonable the manufacture, shipping, acceptance or consumption of any relevant goods or services, shall exempt the affected party from the obligation to deliver or accept, respectively, for the duration and to the extent of the disruption. If this should permanently prevent us from providing the relevant goods or services, both parties shall have the right to revocation. In case of partial or complete discontinuation of our sources of supply we shall not be under any obligation to replenish our stocks from other upstream suppliers. In this case we shall be entitled to distribute the available quantities of goods, taking into account our own needs.

§ 4 Shipping

We reserve the right to choose the route and mode of transport. Additional costs resulting from special shipping requirements of the Customer shall be at the Customer’s own expense. The same shall apply to any increases in freight costs, any additional costs for alternative routes, storage, etc. which may become effective after conclusion of the contract, unless CPT delivery has been agreed. In the case of deliveries ex-works (EXW), if the customer does not accept goods on a confirmed delivery date, this shall be deemed as delayed acceptance without any requirement for a further offer by Neschen. In this case, Neschen shall be entitled at its discretion (i) to store the goods on its
premises or on third-party premises, or (ii) to send the goods to the customer at the latter’s risk and expense. The customer shall bear the additional costs even if he refuses to accept the delivery. The same shall apply in the case of a call-off order if the customer does not call off goods by the latest call-off date as agreed.

§ 5 Retention of Title

1.In all contracts with Consumers, we retain the title to the goods until full payment of the purchase price and payment of any claims arising from a breach of the duty to provide the consideration have been effected. In all contracts with Entrepreneurs, we retain the title to the goods until full settlement of all claims from the ongoing business relationship, including additional claims and claims for damages and payment of checks and bills, has been effected.The retention of title shall also apply if individual claims are included into a current invoice and the balance has been struck and accepted.

2.The Customer shall handle the goods with care. If maintenance and inspection work is required, the Customer shall perform this regularly at his own expense.

3.The Customer shall notify us if any third party should seize the goods, e.g. by way of attachment, as well as about any damage to or destruction of the goods. The Customer shall immediately notify us about any change in the possessor of the goods as well as about any change of his own address.

4.In case of any breach of the contract on the side of the Customer, especially in case of arrears or breach of a duty as defined in subclauses 2 and 3 of the present provision, we shall be entitled to revoke the contract and reclaim the goods. However, with regard to Entrepreneurs the retention of title alone shall not constitute a revocation yet. Any taking back of goods shall always be as a pre caution only and is not to be construed as a revocation, even if payment by instalments was allowed retroactively.

5.The Entrepreneur shall be entitled to resell the goods in the regular course of his business. Already now he assigns to us all claims to the amount of the bill which he attains by sale to a third party.We accept the assignment. There shall not be a right to resale if the claim from the transaction underlying the resale is subject to prohibition of assignment. After the assignment, the Entrepreneur shall be authorized to collect the debt. We reserve the right to collect the debt ourselves if the contractor fails to properly honour his financial obligations and is in arrears. If we feel settlement of our claims to be threatened, the Entrepreneur shall, upon corresponding request by us, notify his purchasers about the assignment and provide us with all the information and documents which we require for
the immediate assertion of our rights.

6.The handling and processing of the goods by the Entrepreneur shall always be done in our name and on our behalf.

7.If the value of the securities we are entitled to should exceed the amount of our claim against the Entrepreneur by more than 20%, we will insofar release the securities upon the Entrepreneur’s request. The choice of the securities shall be at our discretion.

8.All rights from the concluded security agreements existing in our favour, in particular property assigned as a security or subject to retention of title in any form whatsoever, shall be transferred to EUROFACTOR AG.

§ 6 Right to Revocation and Consequences Thereof

In all contracts concluded exclusively by means of telecommunication, Consumers shall have a right of revocation. Telecommunication means are means of communications that can be used to initiate or to conclude a contract between a Consumer and an Entrepreneur without simultaneous physical presence of the parties to said contract, including in particular letters, catalogues, telephone calls, faxes, emails as well as radio, teleservices and media services.

1.The Consumer shall have the right to revoke his declaration of agreement to the conclusion of the contract within two weeks of receipt of the goods. The revocation does not require any justification and must be declared in writing or by returning the goods to the seller; timely sending of the goods shall be sufficient to meet the deadline. The revocation shall be addressed to Neschen AG, Hans-Neschen-Straße 1, D-31675 Bückeburg.

2.We reserve the right to deliver the goods only after expiry of the revocation period.

3.When exercising the right to revocation, the Consumer must return the goods if they can be sent by parcel post. If the order value is up to 40.00 €, or if the Consumer has not effected full or partial payment at the time of return yet, he shall bear the cost of the return. This shall not apply if the goods delivered do not correspond to the order. For orders exceeding 40.00 €, the Consumers need not bear the cost of the return.

4.The Consumer shall pay compensation for any deterioration of the goods resulting from proper commissioning and use of the product as provided. The Consumer may examine the goods carefully and diligently. The loss in value due to any usage exceeding mere examination which results in the goods being unfit for being sold as «new» shall be borne by the Consumer.

§ 7 Return of Goods and Cost Responsibility Agreement in Consumer Contracts

When exercising his right to revocation, the Consumer must return the goods if they can be sent by parcel post. If the order value does not exceed 40.00 €, or if the Consumer has not effected full or partial payment at the time of return yet, he shall bear the cost of the return. This shall not apply if the goods delivered do not correspond to the order. For orders exceeding 40.00 €, the Consumers need not bear the cost of the return.

§ 8 Remuneration

1.The purchase price offered shall be the ex works net price. The minimum order value is 80.00 €. A minimum quantity surcharge will not be levied. In case of sale by delivery to a place other than the place of performance, a shipping charge amounting to 15.00 € for up to 31.99 kg of product weight; to 25.00 € for from 32.00 kg up to 99.99 kg of product weight; and to 30,00 € for 100.00 kg or more of product weight will be collected. In any business with Entrepreneurs, the costs will be billed according to actual cost. The Customer may pay the purchase price by cash, invoice or Eurocard (Master Card) and Visa Card.

2.Payment must be made within 30 days from the date of invoice. After expiry of 30 days from the date of the invoice, the customer will automatically be in arrears. Payments with debt-discharging effect can be effected only by transfer to the EUROFACTOR AG account expressly specified in the invoice.The time of crediting to the aforesaid account of EUROFACTOR AG shall be deemed the time of payment. If the Customer should default on paying any invoice or rate, all hitherto unpaid invoices or rates shall become due for payment immediately. While in arrears, the Consumer shall pay interest on the defaulted debts at a rate of 5% above the base interest rate.While in arrears, the Entrepreneur shall pay interest on the defaulted debts at a rate of 8% above the base interest rate.
In any business with Entrepreneurs, we reserve the right to demonstrate and claim higher losses.

3.The Customer shall have a right to offsetting only if his counterclaims have been legally established or recognized by us. The Customer may exercise a right to retention only if his claim is based upon the same contract.

§ 9 Transfer of Risk

1.If the buyer is an Entrepreneur, the risk of accidental loss or accidental deterioration of the product shall pass to the shipper, carrier or other person or organisation entrusted with executing the shipment upon handover, in case of sale by delivery to a place other than the place of performance upon

2.If the buyer is a Consumer, the risk of accidental loss or accidental deterioration of the product sold shall pass to the buyer only upon handover to the buyer, also in case of sale by delivery to a place other than the place of performance.

3.Default of acceptance on the buyer’s side shall be deemed tantamount to handover.

§ 10 Warranty, Complaints and Manufacturer’s Redress

1.If the buyer is an Entrepreneur, we guarantee for defects in the goods by providing repair or replacement at our option.

2.The Entrepreneur shall report any discernible defect immediately in writing, indicating invoice number, product name, size, lot number, quantity and description of the problem, otherwise the assertion of any warranty claims shall be excluded. The same shall apply if a defect is discovered only later. The Entrepreneur shall bear the onus of proof for all claims, in particular for the defect itself, for the time of discovery of the defect and for the timeliness of the complaint.

3.Any claims to damages and remedial performance based on material defects shall be statute-barred one year after the date of delivery. Withdrawal and reduction shall be excluded after expiry of the same period. If the Customer is a Consumer and has bought new goods, the period shall be two years.

4.If the purchaser is an Entrepreneur, the specification of the product by the manufacturer shall essentially be deemed to be the agreed quality thereof. Public statements, recommendations or advertisements of the manufacturer do not constitute any additionalcontractual specification of the goods. Insofar as the commercial transaction relates to textiles, the error tolerances described separately in the catalogue in section “Processing Information“ shall apply to the textiles.

5.The Customer shall not receive any warranties in the legal sense from us. This shall not affect any warranties given by the manufacturer.

6.If the purchaser is an Entrepreneur, any claims regarding expenses for the purpose of supplementary performance, in particular transport, travel, labour and material costs, shall be excluded, as far as they add to the costs because the delivered goods are subsequently transferred to a location other than the establishment of the Entrepreneur. This shall not apply if the transfer complies with the intended use of the object.

7.An Entrepreneur shall have recourse against us only insofar as the Customer has not entered into any agreements with his customers exceeding the statutory warranty claims. Subclause 6 shall apply, mutatis mutandis, to any recourse of the Entrepreneur against us.

§ 11 Limitations of Liability

1.In case of a slightly negligent breach of duty, our liability shall be limited to the immediate average damage typical for the contract and foreseeable from the type of the goods. This shall also apply to slightly negligent breaches of duty committed by our legal representatives or vicarious agents. Any claims of the Entrepreneur for damages – including extracontractual claims – shall be excluded in case of slightly negligent breach of duty by our legal representatives and other vicarious agents, unless said breach should relate to a duty that is essential to achieving the purpose of the contract.

2.The aforementioned limitations of liability shall not affect any claims of the Customer from product liability. Neither shall the limitations of liability apply to any damage to body or health or loss of life of the Customer.

§ 12 Final Provisions

1.This Agreement is governed by the laws of the Federal Republic of Germany.The provisions of the CISG shall not apply. The provisions of the UN Convention on the Assignment of Receivables in International Trade shall be deemed agreed upon subject to the condition precedent of the moment of its effectiveness.

2.If the Customer is a merchant, a legal entity under public law or an agency under public law, the venue for all disputes arising from the present Agreement shall be either our business location or that of EUROFACTOR AG. The same shall apply if the Customer has no general venue in Germany or if the Customer’s domicile or habitual residence at the time of the filing of the action are not known. The place of performance shall be Bückeburg.

3.If any provision of the contract with the Customer, including the present General Terms and Conditions, should, in whole or in part, be or become invalid or unenforceable, the validity of the remaining provisions shall not be affected. The wholly or partially invalid provision shall be replaced by a provision whose economic result comes as close as possible to that of the ineffective provision. The same applies to filling a gap in the contract with the Customer or in the present General Terms and Conditions.

Version: November 2012