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General Terms and Conditions for Deliverables and Services

I. General Terms
1. All offers provided by SOHARD Embedded Systems GmbH (hereinafter called: „SOHARD“ or „contractor“) are subject to change. Conclusion of a contract shall only be valid after the company’s written order confirmation, or as to the date of start to execute the order.
2. Scope of deliverables or services (hereinafter called: „deliverables“) to be performed by SOHARD, require either written order confirmation or other order papers confirmed and signed by both parties.
3. SOHARD takes exclusively these terms as a basis for all present and future business transactions. SOHARD strictly opposes all different regulations in clients general terms , except of SOHARD has given its strictly assurance with binding character.
4. SOHARD reserves all rights for the unrestricted utilization from rights to the intellectual property rights and right of ownership for all estimates of cost, drawings and other papers (hereinafter called: documentation). Copying of documentation or any access of a third party is only permitted upon prior consent by SOHARD. In case of non-achievement of the contract is SOHARD entitled to claim the immediate restoration of the entire documentation. Section 1 and 2 shall also apply to the client’s documentation, except of authorized access of a third party only when necessary to serve the contract’s purpose.
5. SOHARD is entitled to provide its service in part when it is not unreasonable for the client.

II. Prices and Payment Terms
1. Prices are valid according to the quoted prices from the respective order. All assembly and installation service has to be ordered and paid separately by the client.
2. Prices are tax-excluded, without shipping and handling and valid ex works.
3. In case SOHARD accepted installation service, all required additional expenditure like travel- and transportation costs are to the debit of the client, unless another arrangement is agreed.
4. In case of a default of payment, SOHARD is entitled to claim default interest on arrears of at least 8 per cent above the ECB base rate.
5. The client is entitled for compensation, for withholding a payment and in accordance to the section 320 of the German Civil Code to claim specific performance through delivery versus payment, but only for receivables which are undisputed and legally binding. Furthermore, the client is entitled for withholding a payment only for such receivables arising from this agreement.

III. Right of Retention
1. SOHARD shall retain ownership of the delivered goods until the date of fulfillment of all contracts duties by the client as applicable at the time of the respective delivery (hereinafter called „goods with retention of title“).
2. During the time this ROT is valid, the client shall not be authorized to pledge or assign as collateral these goods, and the resale shall only be permitted at common commercial dealings.
3. All receivables from resale or another legal cause, e.g. an unlawful act, arising from these goods with retention of title, the client shall just now assign to SOHARD these in the amount of the invoice value. This shall also be valid for the balance claim from the agreed open account. The client shall be authorized by SOHARD to collect on their own behalf the assigned claims for the account of SOHARD. In case of default of payment of the client, or of a compulsory enforcement, a remarkable downgraded credit worthiness, or an insolvency proceeding, then SOHARD shall be entitled to revoke the collection authorization, also to claim disclosure of all arising receivables.
4. In case of any garnishment, other decisions or third party claims client shall be committed to call attention to SOHARD’s right of ownership and to notify SOHARD immediately.
5. In case of neglect of duty by the client, especially on default of payment, SOHARD shall be entitled to withdraw from the contract and to claim restoration of the goods with retention of title; the client shall be obligated for restoration of these goods to SOHARD.

IV. Delivery dates and delay
1. Delivery dates are without obligation, unless other arrangement is agreed.
2. Keeping the stipulated delivery dates causes a timely presentation of the entire documentation provided by the client like all required approvals and authorizations, especially for plans, also compliance with stipulated payment terms and other contractual duties. In case of failure of comply of these requirements, delivery date will extending respectively, unless SOHARD itself causes this delay. Sale and delivery of the goods shall be subject to correct and punctual supply to ourselves.
3. If the failure of comply is caused by act of God, i.e. mobilization, war, fracases, or similar events like a strike, legal lockout, and which are not caused by the party which is liable for keeping the time limits, in that case the time limits shall be adequately extended.
4. If the delivery dates are without obligation, then SOHARD is in default only after receipt of a request in writing which should be taken place at the earliest one month after expiration of the delivery time without obligation.

V. Passing of risk and acceptance
1. The risk of accidental loss of the goods („Risk“) shall be transferred to the client:
a) on supplies with handover to the forwarder, but without assembly and installation. The before said is also valid for CPT – freight paid supplies. On client’s demand and for his account , SOHARD can insure the delivery against the general risks
b) on supplies inclusive assembly, installation and handover at the client’s works inclusive faultless test run, provided that was agreed as a work performance.
c) on work performance with acceptance.
2. If the client causes delay of delivery, beginning of work, execution of assembly or installation, handover at client’s works , or the test-run or others, then the risk shall be transferred to the client.
3. Acceptance of work performance shall be immediately taken place after advice of acceptance readiness.
4. So far part delivery of work performance is agreed or according to section I line 5 is permitted, the client shall execute part acceptance, just on SOHARD’s request.
5. When acceptance is not executed in time or incompletely, then the acceptance shall be deemed to be executed with expiration of three working day after receipt of the acceptance readiness.
6. Delivery shall also be deemed as accepted, when set into operation even without SOHARD’s agreement.
7. The client has to make available all requirements needed for acceptance at his works. All acceptance related costs are to the debit of the client, except of SOHARD’s labor costs.
8. The client shall not be authorized to deny acceptance cause of insignificant defects, without prejudice to his right of section VI.

VI. Non-Conformity of the Goods SOHARD is liable for non-conformity of goods as follows:
1. All parts or performances which have defects in quality within the period of limitation – regardless of life circle, whose defect was already shown when passing the risk, then SOHARD is obligated for rectification of defects by repair, or replacement or renewal cost-free by their own choice. („Rectification of defects“).
2. Limitation for claims due to defect expire within 12 months.
3. Claims due to noticeable defects are excluded, unless the client gives SOHARD written notification within a period of five working days after receipt or by work performance before the acceptance. Claims due to hidden defects are excluded, unless the client gives SOHARD written notification within a period of five working days after detection.
4. In case of the failure of rectification and in compliance with the legal regulations, the client is entitled to withdraw from contract, or to claim price reduction.
5. Entitlement to damages or to withdraw from contract due to defects instead of performance are invalid for irrelevant non-conformance of the agreed performance or for irrelevant damnification of the utility.
6. Entitlement for damages are invalid for wear and tear, or for damages which result from incorrect or careless use, excessive use, improper utilities, insufficient construction works, insufficient building ground, or resulting from specific external effects which are assumed under this contract, or for computer bugs which cannot be reproduced. Entitlement to damages are also invalid for inappropriate changes or repairs and their consequences by the client or by third party.
7. Claims of the client for compensation of expenses due to the rectification like transportation-, travel-, labor- and material costs are excluded, so far increase of expenses cause of replacement of the object delivered to another delivery place of the client than stipulated in the contract, unless this place is equivalent to his intended purpose.
8. In case of an unjustified claim by the client, SOHARD shall be entitled to claim compensation of expenses arising from it.
9. The client’s right of recourse in accordance to article 478 of the German Civil Code is possible so far if and in as far as it no others arrangement agreed between the contractual partners beyond the statutory regulations concerning warranty claims. Article 478, sec 2, line 8 of the German Civil Code governs the quantum of a recourse correspondingly.
10. Incidentally, the section IX is essential for indemnity. Further claims of any kind arising from non-conformity from goods between the client and SOHARD or their vicarious agent are excluded.

VII. Industrial Property Rights of Third Party; Defects of Title
1. Solely within the country of the place of delivery, SOHARD shall be obligated to supply free of industrial property rights of third party which can have impact on supply, unless no other arrangement is agreed (hereinafter called: „Industrial property rights“). In case of a justified third party claim against the client arising from breach of industrial property right by SOHARD , then SOHARD shall be liable against the client, as defined within the defined time dates of section VI, line 2 as follows:
a) SOHARD shall be obligated by their own choice and to their own account either to apply an industrial property right or to change supply to prevent a breach of such right, or to replace supply. If it is impossible for SOHARD to act in an appropriate way, then the client shall be authorized to exercise his legal right to withdraw from a contract or to reduce the price.
b) SOHARD’s duty for compensation is defined in section IX.
c) The aforesaid duties are only valid as far as SOHARD is in receipt of client’s immediate written notification about third party claims, acceptance of breach is denied, and SOHARD reserves the right to execute all defense measures and compromises. The client shall be obligated to stop usage of supply for the purpose to minimize losses or for other cause, also to notify third party that stop of usage is not equivalent of the acceptance of a claim.
2. Claims of Client shall be excluded if client is liable for such breach of rights.
3. Furthermore, such claims of client are also excluded as far as the breach of right is arising from client’s special specifications arising from not stipulated usage by the client, from inappropriate cause, or from alternation or shared use with other products but without SOHARD’s permit.
4. In case of breach of industrial property right relating to claims of client, the terms in section No. 1 a) and in section VI No. 8 and 9 shall apply correspondingly relating to claims of client.
5.Any further claims or other stipulated claims of client against SOHARD concerning breach of industrial property right defined in section VII are excluded, except of the limited indemnity which are defined in section IX. limited claims of damages.

VIII. Contractual Adaption
As far as unexpected incidences, according to section IV No. 2, will have substantial effect on the commercial relevance, or on SOHARD’s business, or will substantially alter the subject matter of supply, in this case and regarding the principle of utmost good faith, the contract shall be adapted correspondingly. So far it is not economically reasonable, SOHARD shall be entitled to withdraw from the contract.

IX. Liability of SOHARD
1. SOHARD shall be unrestricted liable for all intentional and gross careless incidences of its legal representatives and employees.
2. SOHARD shall be liable only for slight negligent, i.e. significant neglect of duty which can endanger the achievement of contracts purpose, or a breach of such duties which are essential for correct contractual execution.
3. Indemnity according to section IX No. 2 is limited to the predictable and typical damage for this type of contract. The aforesaid shall also apply to damages arising from gross careless by an ordinary vicarious agent of SOHARD, i.e. not by an officer or by the board of management.
4. Claims of client , according to section IX Nr. 2, expire within a period of two years as to date of arising of the claim and the client get notification of it. Regardless of any know of the claim, claim of damages shall expire at the latest within a period of three years after incident. All claims of defects shall apply section VI Nr.2
5. SOHARD shall not be liable for any loss of profit
6. The mentioned liability limitations are also valid for claims of damages of the client against SOHARD’s employees and representatives
7. The mentioned liability limitation are not valid in cases of violation of live, body and health, for acceptance of guarantee relating the performance of the subject matter and for the Product Liability Law.

X. Juridiction, Agreement of the Applicable Law, Place of Fulfillment
1. Exclusive Jurisdiction for all legal proceedings arising direct or indirect from this contractual relationship is Fürth. SOHARD shall be authorized to take legal proceedings at the clients local.
2. According to all legal relations included to this contract shall governing German Law, but excluding UN-Purchasing Regulations (CISG).
3. Jurisdiction for all legal proceedings arising from this contractual duties is Fürth.

XI. Return of electrical and electronic devices
1. SOHARD takes care of the proper disposal of the delivered goods after their usage ends. The customers takes over the costs of shipping and handling of the goods back to SOHARD.
2. The customer has to ensure that when he sells the goods to third-party usinesses, that those businesses shall be informed and obliged to take care of the proper disposal of the goods at the end of their usage themselves. In case those businesses sell the goods to further businesses, this information and obligation has to be passed on as well.
3. The obligation of the manufacturer to take back goods at the end of their usage, or being removed from this obligation thru the customer, seizes two years after the last final usage of the goods. The two year period starts as of notification, in written form, from the customer to the manufacturer that usage has ended.

XII. Miscellaneous
1. Change of delivery terms as well as the requirement of written form, both strictly enforces written confirmation
2. If any provision of this terms is held to be invalid, such provision shall be struck out and the remaining provisions shall be hold good. This shall be invalid if it is unreasonable for one of the contractual partners.
3. SOHARD is entitled to store client’s personal data in compliance with legal regulations, particularly the German Federal Data Protection Act, to use all sensitive information to fulfill the contracts purpose and to protect data against unauthorized access of third party.

Release: Mai 2009