TERMS AND CONDITIONS

Terms and Conditions for Purchase and Repair Service Orders of

Mitsui Rail Capital Europe GmbH (“MRCE“)

per October 2016

 

  1. Purchase order and order confirmation

1.1 MRCE may revoke the purchase order, if the Contractor/Seller has not accepted it in writing within two weeks following receipt (order confirmation).

1.2 Should the order confirmation deviate from the purchase order, then MRCE will be bound only if MRCE has consented to the deviation in writing. In particular, MRCE shall be bound to general terms and conditions of the Contractor/Seller only to the extent that they are consistent with the MRCE terms and conditions or MRCE has consented to them in writing. Accepting goods or services as well as payments does not constitute consent.

1.3 Modifications or supplements to the purchase order are valid only if MRCE has confirmed them in writing.

1.4 MRCE will indicate to the Contractor/Seller in the purchase order as to whether goods or services are safety-related.

  1. Rights of use

2.1 The Contractor/Seller grants MRCE the non-exclusive, transferable, sub-licensable, global and perpetual right,

2.1.1 to use the goods and services and to integrate them into other products;

2.1.2 to use or allow to be used the software and the related documentation (hereinafter collectively referred to as the “Software“) in connection with the installation, the commissioning, the testing and the operation of the Software;

2.1.3 to sublicense the right of use under subsection 2.1.2 to affiliates within the meaning of § 15 of the German Stock Corporation Act, and to end customers;

2.1.4 to license affiliates within the meaning of § 15 of the German Stock Corporation Act the right to grant end customers the right of use under subsection 2.1.2;

2.1.5 to use and copy, or to have affiliates within the meaning of § 15 of the German Stock Corporation Act use or copy, the Software for the integration into other products.

2.2 The Contractor/Seller grants the following rights in addition to the rights granted under subsection 2.1.1:

2.2.1 If the Contractor/Seller performs development work, then MRCE will receive the transferable, sub-licensable, global and perpetual right to use the development work and its results in order to manufacture the items for delivery (in a series) either itself or through a third party. This right and the right under subsection 2.1.1 are exclusive, provided that the rights of the Contractor/Seller, which already existed prior to the order of the development work, are not affected (hereinafter referred to as “Background IP”); the right is non-exclusive with regard to the Background IP.

2.2.2 If (a) the Contractor/Seller – after the fruitless expiration of a reasonable grace period set by MRCE – is not in a position to deliver the Contractor/Seller’s items for delivery and MRCE is therefore unable to discharge the duties it owes to its customers, (b) one of the situations described in section 16 arises or (c) the Contractor/Seller discontinues either its business operation in general or the impacted business segment, then MRCE shall obtain the non-exclusive, transferable, sub-licensable, global and perpetual right to manufacture the Contractor/Seller’s items for delivery either itself or through a third party.

2.3 The Contractor/Seller grants the following rights in addition to the rights granted under subsections 2.1.2 through 2.1.5:

2.3.1 MRCE and affiliates within the meaning of § 15 of the German Stock Corporation Act are authorized to allow end customers to transfer the Software licenses.

2.3.2 If the Contractor/Seller develops Software, then the rights of MRCE to the Software as described in subsections 2.1.2 through 2.1.5 shall be exclusive, provided that the rights of the Contractor/Seller, which already existed prior to the order of the development work, are not affected (hereinafter referred to as “Software Background IP”); the right is non-exclusive with regard to the Software Background IP.

2.3 The Contractor/Seller shall inform MRCE in a timely manner, but no later than upon order confirmation, as to whether its goods and services contain “open source software”. “Open source software”, within the meaning of this provision, is any Software, the delivery of which to a third party must generally be carried out on a royalty-free basis and which may be processed by any user and/or must be disclosed to licensees or third parties in the form of its source code. If the goods and services delivered by the Contractor/Seller contain open source software, then the Contractor/Seller shall deliver the following to MRCE no later than upon order confirmation:

– source code of the used open source software, to the extent that the applicable open source license terms and conditions require the disclosure of such source code

– listing of all used open source files with a reference to the applicable license as well as a copy of the full text of the license

– written statement that the lawful and compliant use of open source software will not subject the Contractor/Seller’s goods and services or the MRCE products to a so-called “copyleft effect”, whereby “copyleft effect”, as used in this provision, means that the open source license terms require that certain goods and services delivered by the Contractor/Seller, as well as the works derived therefrom, may be disseminated only under the terms and conditions of the open source license, e.g., by disclosing the source code.

If, only after its receipt of the purchase order, the Contractor/Supplier indicates that its goods and services contain open source software, then MRCE will be entitled to revoke the purchase order within 14 days after receipt of the notification and provision of all information listed in the above paragraph.

  1. Time of performance, contractual penalties for performance irregularities [Leistungsstörungen]

3.1 The timeliness of the deliveries or of any subsequent performance will be determined by their receipt at the receiving point designated by MRCE, in the case of services, it will depend on their acceptance [Abnahme].

3.2 MRCE shall be notified without undue delay in the event there is an identifiable delay in a delivery of the goods or service or in subsequent performance.

3.3 In the case of a good or service, without which locomotives could not be operated (e.g., engines) or without which the locomotives could not be operated safely (e.g., component parts for a safety system), the agreed deadline is missed due to reasons for which the Contractor/Seller is responsible, then MRCE shall be entitled to charge a contractual penalty [Vertragsstrafe] equal to 0.4% for each commenced working day of the delay, but no more than 10%, of the total contract sum.

If the delivery of other goods or service fails to meet the agreed deadline due to reasons for which the Contractor/Seller is responsible, then MRCE will be entitled to charge a contractual penalty equal to 0.2% for each commenced working day of the delay, but no more than 5%, of the total contract sum.

If, during the receipt/ acceptance of the goods, services or subsequent performance, no corresponding reservation is made, then the contractual penalty may nevertheless be enforced up until the final payment.

MRCE may elect to enforce additional damages, but in that case, the contractual penalty will be set off accordingly.

  1. Transfer of risk, shipment, place of performance

4.1 With respect to the delivery of goods, the risk shall pass when the goods are received at the receiving point designated by MRCE, and with respect to services, the risk shall pass upon acceptance of the service.

4.2 Unless otherwise agreed, the Seller shall be responsible for covering the shipping and packaging costs. For any price given ex works or ex sales warehouse of the Contractor/Seller, the shipment shall be made in each case at the lowest costs, unless MRCE has prescribed a specific form of transport. Additional costs caused by a shipping instruction that was not observed shall be borne by the Contractor/Seller. Additional costs for an accelerated mode of transport, which may have been required in order to comply with the delivery deadline, shall be borne by the Contractor/Seller.

4.3 A packing slip or delivery note with a description of the content (of the shipment) as well as the complete purchase order reference code, the MRCE article number and (if available) the serial number shall all be included with each delivery of a good or service. Notice of the shipment shall be made immediately with the same information.

4.4 For safety-related goods, the Contractor/Seller shall enclose with the delivery the reports and certificates required by MRCE; in the alternative, these items shall be transmitted, at MRCE’s discretion, to MRCE via procurement@mrce.eu.

  1. Invoices

The invoices shall show the purchase order reference code and the numbers for each individual line item. Invoices cannot be paid as long as such information is missing. Any invoice duplicates shall be identified as duplicates.

  1. Payments

6.1 Unless otherwise agreed, payments are due within 14 days with a 3% early payment discount [Skonto] or within 30 days net.

6.2 The payment period will begin as soon as the goods or services have been completely delivered and the duly issued invoice is received. To the extent the Contractor/Seller has made available material tests, inspection records, documents on quality or other documents, the goods and service will not be deemed to have been completely delivered until such documents are also received. Deduction of early payment discounts are also still permissible if MRCE applies a set-off or withholds a reasonable amount of payments based on defects. The payment period for the reasonable portion, which is withheld from the work product compensation/purchase price because of defects, will begin to run once the defect has been fully remedied.

6.3 MRCE will be deemed to be in payment default [Verzug], only if MRCE fails to pay in response to a dunning notice [Mahnung] that is sent by the Contractor/Seller after the work product compensation/purchase price has fallen due.

6.4 Payments do not constitute an acknowledgment or recognition that the deliveries or services are considered contractually conforming.

  1. Acceptance of services

7.1 MRCE shall expressly declare acceptance to the Contractor. MRCE may reserve a period of two weeks in order to test the rendered services following their receipt. Any usage during this period of time shall not be deemed acceptance.

7.2 If MRCE does not object to known defects during the acceptance, then any claims based on defects will be nevertheless preserved.

  1. Incoming inspections of delivered goods

8.1 MRCE will discharge its duties of inspection (review as to quantity and type; externally identifiable transport damage or errors) after the delivered goods are received.

8.2 If MRCE discovers a defect during the aforementioned inspections, then MRCE will notify the Seller thereof. If MRCE discovers a defect at a later time, then MRCE will likewise provide notice thereof.

8.3 Notifications may be made within two weeks following delivery or, if the defect is discovered only later – such as during treatment or processing or usage – then within two weeks following their discovery.

8.4 MRCE does not owe the Seller any duties of inspection and notification beyond the foregoing.

  1. Liability for defects

9.1 Goods and services shall (a) satisfy the agreed specifications and functions, (b) embody state-of-the-art technology, (c) comply with the applicable statutory provisions, specifically regarding product safety and safety-related requirements, and (d) meet the rules prescribed by trade and professional associations as well as industry standards.

9.2 If defects are identified when risk passes or they arise during the prescription period set forth in subsection 9.10, then the Contractor/Seller shall, at its own expense and at MRCE’s option, either remedy the defect or deliver a good or perform a service that is free of defect. The foregoing also applies to delivery of goods, the inspection of which was limited to random sample testing. MRCE shall select its option using its reasonable discretion [nach billigem Ermessen].

9.3 If the Contractor/Seller does not subsequently perform within a reasonable period of time that is stipulated by MRCE, then MRCE shall be entitled to rescind all or part of the contract or to demand a reduction in the price or to remedy the defects either itself (self-help) or through a third party at the expense of the Contractor/Seller or to demand damages in lieu of performance. Sections 281 (2) and 323 (2) of the German Civil Code shall remain unaffected thereby.

9.4 Subsequent improvements may be carried out at the expense of the Contractor/Seller even without setting any performance deadlines, if delivery is made after there has been a performance default.

9.5 The same applies if – in attempting to avoid its own performance default or based on other urgent circumstances – MRCE has a special interest in immediate subsequent performance and it would be unreasonable for MRCE to have to demand that the Contractor/Seller remedy the defect within a reasonable period of time.

9.6 More extensive or other statutory claims held by MRCE remain unaffected thereby.

9.7 MRCE may, at its option and for the Contractor/Seller, store or dispose of the defective products or return them to the Contractor/Seller.

9.8 The Contractor/Seller shall bear (a) the costs of subsequent performance, specifically the costs of transport, travel, labor and materials, the costs for returning the locomotives for purposes of repair work resulting from defects as well as the buildout and installation costs [Aus- und Einbaukosten], and (b) the costs and risk of storage, disposal and return shipment of defective deliverables.

9.9 In return for MRCE having to process and administer defect cases, the Contractor/Seller shall compensate costs in the amount of 12% of the repurchase value of the respective defective good or service, minimum EUR 75 per defect, however.

9.10 Claims based on defects in quality and legal title will be barred by prescription in three years, unless the statutes stipulate longer limitation periods.

9.11 The prescription period will begin to run when the risk passes (subsection 4.1). Where deliveries are made to sites apart from the factories or workshops of MRCE, the prescription period will begin to run upon delivery to that respective site, but no later than one year after risk passes.

9.12 If the Contractor/Seller delivers anew as part of its obligation to remedy the defect, then the prescription period set forth in subsection 9.10 shall also begin to run anew. The same rule will apply in the case of the subsequent improvement, to the extent that the situation involves the same defect or the consequences of a defective subsequent improvement.

  1. Liability for the infringement of intellectual property rights

For MRCE, the delivery of goods and performance of services that is free and clear of any legal title issues is a material aspect of the contract. The Contractor/Seller shall therefore review whether the goods and services have unencumbered legal title and alert MRCE to any potentially opposing intellectual property rights.

  1. Compliance with the applicable statutes

11.1 The Contractor/Seller shall comply with the applicable statutory provisions, including any and all requirements under the German Hazardous Goods Transport Act (GGBefG) as well as the EU directive on the restriction of the use of certain hazardous substances in electrical and electronic equipment (RoHS 2011/65/EU), the EU directive on waste electrical and electronic equipment (WEEE 2012/19/EU) and the EU directive concerning the registration, evaluation, authorisation and restriction of chemicals (REACH 1907/2006/EC), as well any national implementing acts based thereon.

11.2 The Contractor/Seller shall deploy only personnel who are adequately qualified. The Contractor/Seller has the sole and exclusive right to direct and organize its personnel (specifically in terms of the type, location and implementation of the work as well as the working conditions and working hours). The Contractor/Seller is responsible for compliance with the statutory and regulatory duties it owes to its personnel and shall pay them (at least) a minimum wage as required by law.

  1. Subcontracting

Subcontracting to third parties is prohibited without the written consent of MRCE and will entitle MRCE to terminate all or part of the contract or to demand compensatory damages.

  1. Provision of materials

13.1 Any materials that have been set aside [Materialbeistellungen] shall remain the property of MRCE and shall be stored separately, labeled and managed at no extra charge.

Such set aside materials may be used only for MRCE orders. The Contractor/Seller shall pay compensation for any reduction in value or loss. The foregoing also applies to any charged transfer of order-related material.

13.2 The processing or restructuring of materials is done on MRCE’s behalf. If these materials are processed, restructured, co-mingled or physically connected with other items of property not belonging to MRCE, then MRCE will acquire a co-ownership interest in the new property that reflects the value of these materials in proportion to the value of the other, processed, restructured, co-mingled or connected items of property as of the point in time when such materials and property was processed, restructured, co-mingled or connected. If the co-mingling or connection is carried out in such a manner that the property of the Contractor/Seller is viewed as the primary item of property, then it agrees to convey its proportionate co-ownership interest to MRCE. The Contractor/Seller agrees to hold in custody on behalf of MRCE – and free of charge – any sole ownership or co-ownership interest that arises within the meaning of this section, and to exercise the care of a diligent merchant [Sorgfalt eines ordentlichen Kaufmanns].

  1. Tools, molds, templates, confidentiality, etc.

Any tools, molds, templates, models, profiles, drawings, standard sheets, preprinted preparation materials and gauges, which have been provided by MRCE together with any products manufactured on the basis of those items, may not be disclosed to any third parties or used for purposes other than those purposes set forth in this contract, unless written consent has been obtained from MRCE. These listed items shall be secured against unauthorized viewing or use. Without prejudice to its other rights, MRCE may demand repossession of such items, if the Contractor/Seller breaches these duties. The Contractor/Seller shall not provide to third parties any information procured from MRCE, unless such information is generally known or it acquired the information in some other lawful manner. If MRCE has consented to subcontracting to third parties, then such third parties shall be subjected to the same obligations in writing. MRCE may provide information, which it acquires from the Contractor/Seller, to affiliates within the meaning of §15 of the Stock Corporation Act, advisors, regulatory authorities and business partners.

  1. Assignment of receivables

Receivables held against MRCE may be assigned only with the prior written consent of MRCE.

  1. Inability to pay/insolvency of the Contractor/Seller

If the Contractor/Seller ceases making payments, a preliminary insolvency administrator is appointed or insolvency proceedings are commenced against the assets of the Contractor/Seller, then MRCE will be entitled to rescind the contract either in whole or in part or to terminate the contract. In that case and in exchange for reasonable compensation, MRCE may make use of the existing facility or any previously delivered goods and services from the Contractor/Seller in order to continue the work.

  1. Audits

The Contractor/Seller shall allow MRCE, either itself or through third parties, to perform reasonable and regular (at least once every half year) audits of the business premises, facilities, books and other written documents of the Contractor/Seller. If safety-related goods or services are delivered, then the audits may be carried out on a more frequent basis.

  1. Supplemental provisions

To the extent the terms and conditions of the purchase order do not contain a certain rule, the statutory provisions will govern.

  1. Judicial forum, governing law

19.1 Exclusive jurisdiction and venue shall lie with the competent courts of Munich, if the Contractor/Seller qualifies as a merchant [Kaufmann].

19.2 German substantive law applies to the exclusion of the UN Convention on Contracts for the International Sale of Goods.