General terms and conditions of purchase 
of ESSMANN GmbH, D-32107 Bad Salzuflen,
valid with effect from December 2011
I. General information, scope of application
1. Our General Terms and Conditions of Purchase are solely applicable; we shall not acknowledge any
terms and conditions dictated by suppliers that are contradictory to, or deviate from, our General Terms
and Conditions of Purchase unless we have expressly accepted them in writing. Our General Terms and
Conditions of Purchase are also applicable in the event that we accept deliveries from a supplier without
reservation although we are aware that the terms and conditions of said supplier are contradictory to,
or deviate from, our General Terms and Conditions of Purchase.
2. All agreements between us and the supplier in respect of contractual performance must be recorded in
writing. This shall apply equally to any supplements, amendments or subsidiary agreements. If and to
the extent that drawings, illustrations, dimensions, weights or other specifications deviate from our
order or a quotation that we have confirmed in writing, they shall only be deemed binding if expressly
agreed in writing.
3. Our General Terms and Conditions of Purchase are only applicable to merchants within the context of
Section 24 of the German act governing general terms and conditions of business (Gesetz zur Regelung
des Rechts der Allgemeinen Geschäftsbedingungen, AGBG).
4. Our General Terms and Conditions of Purchase shall also apply for any and all future business
transactions.
II. Quotations, quotation documents
1. We reserve the right to specify changes in materials, design engineering and execution.
2. Suppliers must undertake to confirm our orders within four days.
3. We retain title and copyright to all illustrations, drawings, calculations and other documents; such
documents may not be made available to third parties without our express written consent. They may
only be used for the purpose of fabrication, based on our order; they must be returned to us without
further demand once the order has been fulfilled.
III. Performance, transfer of risk
1. Unless otherwise agreed, consignments must be delivered with carriage paid, including packaging. Upon
demand, the supplier must take back the packaging material used for the delivered items. In the event
that the supplier fails to do so, we shall be entitled to dispose of the packaging materials at the
supplier's expense.
General consignments must be shipped to Herford, express consignments to Bad Salzuflen.
2. The risk associated with erected buildings, steel structures, machinery any other fixtures shall not pass
to us until written acceptance has been issued by an agent commissioned by us.
3. The supplier undertakes to indicate our order number accurately on all shipping papers and delivery
notes; failure to do so will inevitably result in delays in processing, for which we shall not be held
accountable.
IV. Execution provisions
If and to the extent that we provide the supplier with drawings, samples or other instructions, they
must, under all circumstances, be used as the basis for contractual performance. If and to the extent
that we demand the provision of type samples, fabrication may not commence until we have approved
the sample in writing. The supplier must notify us immediately in writing and prior to commencing
fabrication in the event of any doubts relating to our instructions. In such cases, fabrication may only
commence once we have provided further written instructions. Supplier performance must be
compliant with applicable legal provisions, ordinances and guidelines, and accident prevention and work
safety regulations, and must reflect the latest and acknowledged best engineering practice. The
particular safety requirements of our plant must also be observed. The supplier shall bear the costs of
the necessary safety precautions.
V. Delivery period
1. The delivery period indicated on our order is binding.
2. The supplier undertakes to notify us immediately in writing if circumstances occur or indicate that it will
not be possible to meet the specified delivery date. The reasons for, and probable length of, the delay
must be indicated.
3. If and to the extent that consignments have to be express forwarded for reasons for which the supplier
is accountable, the ensuing additional cost must be borne by the supplier.
4. Delivery and payment dates must be renegotiated if punctual delivery proves to be impossible for
reasons for which we are accountable, or if final acceptance is therefore delayed.
5. We shall be entitled to assert the normal statutory claims in the event of delayed deliveries. In
particular, we shall be entitled to demand compensation on grounds of non‐performance after expiry of
a reasonable period of grace.
VI. Force majeure
In the event of force majeure (natural catastrophes, outbreak of war, unrest, fire), labour disputes,
official measures or other disruptions in operations at our company, our subcontractors or our
customers that force us to cease or restrict production, or prevent us from removing ordered
merchandise, we shall be exempted from our acceptance obligations within the delivery period for as
long as these effects prevail and to the extent that we are impacted by them, provided that we are
unable to take reasonable steps to avert the disruption. If and to the extent that the disruption lasts
longer than four weeks, either party shall be entitled to withdraw from the contract. In such case, any
claims by the supplier for performance or compensation shall be excluded.
VII. Prices
1. The agreed prices shall be deemed to be fixed. Subsequent price amendments shall be excluded, even if
costs should subsequently increase, unless expressly otherwise agreed in writing.
Any cost increases or reductions resulting from design changes must be notified to us immediately in
writing and must be confirmed by us, also in writing.
2. Invoices must be submitted in duplicate. Under no circumstances may they be included with the
consignments. We are only able to process invoices that indicate our order number and the ordering
date; the supplier shall be responsible for any and all consequences arising as a result of non‐compliance
with this obligation.
3. Unless otherwise agreed in writing, we shall be entitled to choose whether to pay the invoice amount
within 60 days net or within 14 days with 3 percent discount. Payment terms commence on the date of
receipt of the invoice, but not before we have received the consignment. Each and every payment is
subject to proper performance of all of the supplier's obligations by the time payment is due.
VIII. Inspection for defects, rights in the event of defects, liability
1. The requirement pursuant to Section 377 of the German commercial code (Handelsgesetzbuch, HGB) to
submit complaints in respect of defects immediately on receipt of goods shall not be applicable.
2. The supplier shall assume liability for its deliveries and performance. In respect of issues relating to the
purchasing agreement, Sections 437 et seqq, and in respect of issues relating to the works contract,
Sections 634 et seqq of the German civil code (Bürgerliches Gesetzbuch, BGB) shall apply. The supplier
shall exempt us from any and all claims asserted against us by our customers in respect of deliveries and
performance provided by the supplier. In this respect, the statutory warranty rights for any and all
claims for damages shall only become applicable once our customer has notified us of a defect or
occurrence of damage.
An extended warranty agreed in individual cases or for specific performance shall take precedence. The
supplier is liable for ensuring the guaranteed properties of its performance.
The supplier has enquired about the intended application and location of deployment of its product and,
on this basis, has guaranteed the functional reliability of its product and the adequacy of the product for
the application requirements.
3. We shall be entitled to return to the supplier any merchandise that is not in conformity with the
contract, or is damaged or defective, and to demand reimbursement, irrespective of whether the
defects are immediately recognisable or only become apparent during processing or following
commissioning.
4. Defective merchandise shall be returned at the risk and expense of the supplier. We reserve the right to
remedy damaged or defective merchandise at the expense of the supplier. The supplier shall always be
notified accordingly in advance. In the event that merchandise is returned to the supplier, the supplier
shall only be entitled to ship replacement merchandise if we submit a new order.
5. If and to the extent that defects are detected during acceptance of systems and equipment, we shall be
entitled to withhold a reasonable portion of the invoice amount – and of future invoice amounts – until
such time as the defects have been remedied.
6. Payment by us shall not, under any circumstances, constitute acknowledgement that the supplier's
performance is free of defects and in conformity with regulations. Unless otherwise agreed, the
statutory period of limitation for all deliveries and performance by the supplier shall be five years.
7. Notwithstanding the above, the supplier shall be liable for all injuries, financial losses and damages to
property suffered by us, our employees or any third parties in connection with the merchandise
delivered by the supplier, to the extent that the supplier is responsible for these damages. This liability
shall also encompass damages arising as a result of travel and freight costs or any other expenses that
we incur in the rectification of defects.
IX. Product liability, exemption, product liability insurance
1 If and to the extent that the supplier is responsible for damages caused by a product, the supplier shall
undertake to exempt us at first demand from any third‐party claims for compensation to the extent that
the cause lies in the supplier's area of control or organisation and it is liable vis‐à‐vis third parties.
2. To the same extent and pursuant to Sections 683, 670 BGB, the supplier shall undertake to reimburse
any expenses incurred by us as a result of, or in connection with, any call‐back action that we may have
to initiate. We shall notify the supplier of the content and scope of said call‐back action – to the extent
that this is possible and reasonable – and shall give the supplier the opportunity to comment.
3. The supplier shall undertake to maintain product liability insurance that covers claims up to a lump sum
of EUR 2.5 million per incident of injury or property damage; this shall be without prejudice to any
further claims for compensation to which we may be entitled.
X. Exclusion of liability
We shall accept no liability for third‐party property, including means of transportation, that may
disappear, or be damaged or destroyed, on our premises as a result of minor negligence.
XI. Property rights
1. Unless fabricated to our drawings/specifications, the supplier shall guarantee that its deliveries and
performance, and the utilisation of the same, do not violate any German or foreign industrial property
rights or any other third‐party rights.
2. In the event that claims are asserted against us by a third party in this respect, the supplier shall
undertake to exempt us at first written demand from these claims; we shall not be entitled to negotiate
any agreements with this third party, and specifically not to agree any settlement, without the consent
of the supplier.
3. This exemption obligation applies for all expenses necessarily incurred by us or in connection with the
assertion of a third‐party claim.
4. If and to the extent that a court of law rules that the performance by the supplier violates third‐party
property rights, or if justified doubts arise in this respect as a result of an opinion by a certified expert,
we shall be entitled to withdraw from the contract with immediate effect.
XII. Reservation of title, provision of parts, tools, confidentiality
1. We reserve title to any and all parts provided to the supplier. Any processing or modification of these
parts by the supplier is performed on our behalf. If and to the extent that parts supplied by us under
reservation of title are processed together with other objects that do not belong to us, we shall acquire
co‐ownership in the new product in the ratio of the value of our part to the value of the other processed
contents at the time of processing.
2. If the part provided by us is combined inseparably with other objects that do not belong to us, we shall
acquire ownership in the new product in the ratio of the value of our reserved part to the value of the
other combined contents at the time they are commingled. If the commingling results in the supplier's
contribution to the content forming the main element of the new product, agreement shall be deemed
to exist that the supplier shall transfer proportionate co‐title to us; the supplier shall safeguard our sole
title or co‐ownership on our behalf.
3. We reserve title to all tools; the supplier shall undertake to use the tools solely for the purpose of
fabricating the goods we have ordered. The supplier shall undertake to insure tools that belong to us
against fire and water damage, and theft, at their replacement value and at its own expense. The
supplier shall also undertake to perform any necessary maintenance and repair works at its own
expense and in good time. It shall notify us immediately of any damages; culpable failure to do so shall
be without prejudice to any claims for compensation.
4. The supplier shall undertake to treat any and all illustrations, drawings, calculations and other
documents and information supplied by us in the strictest confidence. They may only be made available
to third parties with our express consent. This confidentiality obligation continues to apply even after
execution of this contract; it lapses only and if the manufacturing expertise contained in the provided
illustrations, drawings, calculations and other documents becomes general public knowledge. The
supplier shall not be entitled to use its business relationship with us for advertising or public relations
purposes without our consent.
XIII. Transferability, offsetting, right of retention
1. The rights and obligations arising from this contract may not be pledged and transferred without our
written consent.
2. The supplier shall only be entitled to offset or assert a right of retention if its counter‐claim is
undisputed by us or has been established in a court of law.
XIV. General information, place of performance, court of jurisdiction, applicable laws
1. Any disputes arising from, or in connection with, this contract are subject to German law only. The legal
relationships governing this contract are subject to German law. The UN Convention on Contracts for
the International Sale of Goods (CISG) is excluded.
2. Bad Salzuflen is the place of performance for our payment obligations. Bad Salzuflen is deemed to be
the responsible court of jurisdiction for any disputes arising between the contract parties.
3. The invalidity of any of the aforementioned provisions shall not affect the validity of the remaining
General Terms and Conditions.
