SCHOTT Purchasing Terms and Conditions

SCHOTT Purchasing Terms and Conditions                             1 March 2002

The following terms and conditions govern purchase agreements and other contracts relating to goods and services made, or agreed to by the company SCHOTT or any of its German Holding Companies (herafter named 'SCHOTT').
These terms are not applicable to constructions or construction services.
1.Content of Agreement:

Unless otherwise individually agreed in writing, the legal relationship between the Supplier and SCHOTT with respect to the transactions described below will be based exclusively on the following terms and conditions. Any conflicting terms and conditions provided by the Supplier shall not apply, even if SCHOTT fails to expressly reject such terms and conditions in any given case, specifically when ordered goods are accepted without objection.

2.Writing Requirement:

All orders, together with any modifications or supplements thereto, must be made in writing.


SCHOTT has the right to revoke its order free of cost if the Supplier fails to confirm such order verbatim within two weeks following its receipt thereof.

4. Delivery Dates:

a)    Any agreed delivery dates for goods or services are binding. If any delays are anticipated or in fact occur, the Supplier shall promptly notify SCHOTT thereof.

b)    If, as a result of the Supplier's fault, the delivery date deadline is not met (default), then SCHOTT may demand compensatory damages, without prejudicing its other rights.

c)    If the Supplier fails to perform its contractual duties within a reasonable period for cure stipulated by SCHOTT, then SCHOTT will have the right, following the expiration of such period, to commission a third party to perform the Agreement and to demand that the Supplier reimburse SCHOTT for necessary expenses and additional costs incurred as a result. SCHOTT also has the right to demand compensatory damages in lieu of specific performance. Upon expiration of the cure period, the Supplier’s right to cure and SCHOTT’s obligation to accept such performance will lapse as soon as SCHOTT procures substitute performance on its own in lieu of specific performance, or if SCHOTT demands compensatory damages in lieu of specific performance.

5. Prices:

The prices are firm. These prices include all expenses connected with the goods and services to be provided by the Supplier.

6. Processing and Delivery:

a)    The Supplier may sub-contract only with the consent of SCHOTT, unless such sub-contracts relate simply to the supply of marketable components. Any supply requests concerning the type and quantity of the requested goods and the delivery schedule are binding. Instalment deliveries require the consent of SCHOTT.

b)    A delivery note must accompany every delivery, and must indicate the order number of SCHOTT and describe the contents according to type and quantity.

c)    A technical description and a user manual must accompany devices and is free of charge. Software products will be deemed duly delivered only after all documentation (system-technical and user) has been delivered. With respect to any programs specifically written for SCHOTT, the program should also be delivered in source code format.

7. Invoices, Payments:

a)    Invoices must be submitted to SCHOTT in duplicate. They must include SCHOTT's order number and correspond verbatim with our order descriptions. The exact description of the department making the order and the date of the order are also to be specified.
Invoices that fail to include all of the above information will be returned. They will not be deemed received and thus do not become due and payable, nor may they be used by you as evidence of any failure to pay on the part of SCHOTT.

b)    The invoice payment period commences upon receipt of a proper, verifiable invoice (stamped date of receipt, not date of invoicing!), or on the work day following the date on which delivery of the goods or service was taken, whichever is later.
Invoices that are defective or that contain errors do not become due and payable and we may send these back at any time. In the latter case, the obligation shall only become due and payable upon receipt of the corrected invoice. If delivery documents are missing, or if the invoice was received by an office other than that which was specified, or it contains incomplete or incorrect information, this will stay the payment period for whatever number of days it takes to eliminate the errors caused by the Supplier. The duration of the stay of the invoice audit shall be taken into consideration in substantiating any failure to pay and/or such contested invoices may not be used by you as evidence of failure to pay on the part of SCHOTT.
Any payments made will not constitute a recognition that the good or service is contractually conforming. In the event any good or service is non-conforming or incomplete, SCHOTT may – without prejudicing its other rights – reasonably and without compensation withhold payment on any other claims arising in connection with the business relationship until any defective performance been properly cured, without losing any rebates, cash discounts, or similar payment benefits.

c)    Payment shall be made in the payment period immediately following the date the invoice becomes due and payable by the payment method of SCHOTT's choice.

8. Statutory Requirements:

a)    For all goods and services, the rules concerning hazardous substances as well as the safety recommendations of German professional bodies and associations - such as VDE, VDI, DIN - must be observed. Any relevant certifications, testing reports and evidence must be furnished free of charge along with the goods and services.

b)    With respect to any goods or the provision of any services, the Supplier shall be solely responsible for adhering to the rules on accident prevention. According to these rules, the required safety provisions and any other manufacturers' guidelines must be furnished free of charge along with the goods and services.

9.Passage of Risk, Acceptance, Title Retention Rights:

a)    Irrespective of the agreed indemnification provisions, the risk of loss on the delivery of goods not involving installation or assembly shall pass to SCHOTT upon receipt of such goods at the address of delivery stipulated by SCHOTT and, with respect to the risk of loss on the delivery of goods involving installation or assembly, it shall pass upon the successful completion of such installation or assembly, which will be documented in an acceptance record.

SCHOTT’s mere operational start-up or use shall in no way constitute a formal acceptance.

b)    With respect to the delivery of goods subject to title retention, SCHOTT may resell such goods in the ordinary course of business. SCHOTT shall become the owner no later than upon payment of the full purchase price.

10. Duties of Inspection and Complaints, Inspection Expenses:

a) SCHOTT shall promptly notify the Supplier regarding any obvious defects in the goods or services supplied, as soon as such defects are identified in the ordinary course of business. With respect to any defects that SCHOTT notifies within four weeks, the Supplier agrees to waive any expenses arising from a delayed notice of defect.

b)    Goods will be inspected upon receipt, and such inspection shall be done on a random sampling basis. If the benchmark quality levels set by SCHOTT are not met, then SCHOTT will have the right to completely reject the goods or carry out a full inspection (100%) at the Supplier's expense.

c)    If SCHOTT returns defective goods to the Supplier, then SCHOTT will have the right, regardless of the amount of the expenses incurred, to charge the Supplier the invoice amount plus a flat -expense charge of 5% of the price of the defective goods, in any case, however, not exceeding EUR 550.00 for each returned shipment. SCHOTT expressly reserves the right to provide evidence of higher expenditures.

11. Warranties against Defects in Quality and in Title:

a)    Any defective goods must be promptly substituted with conforming goods, and any defective services must be repeated in a conforming manner. In the event of a substitution or repeat of services, cure shall be deemed to have failed (§§ 440, 636 BGB) in those cases where the defect in quality has still not been eliminated even after a second attempt to cure has been made. In the case of any errors occurring in development or construction, cure shall be deemed unreasonable (§ 440 BGB) and we reserve the right to promptly enforce the rights set forth in Section 11 d).

b)    During the period in which the subject matter of the goods or services is not in SCHOTT’s custody, the Supplier shall bear any risk of loss.

c)     In emergency situations (specifically where operational safety is in jeopardy or to avoid extraordinarily high damages), and also in order to eliminate minor defects, SCHOTT shall have the right to itself cure the defect and any damages resulting therefrom at the Supplier’s expense or to have a third party cure such defects. The foregoing shall also apply in other cases, to the extent a reasonable cure period set by SCHOTT has expired without result.

The aforementioned shall also apply if the Supplier is late in delivering the goods or services and SCHOTT is required, as a result of such defect, to immediately cure the defect to avoid defaulting on its own delivery.

d)    To the extent SCHOTT does not elect to remedy the defect itself and where a reasonable cure period set by SCHOTT has expired without result, SCHOTT shall otherwise have the option either to rescind the contract or to reduce the contractually agreed purchase price (price reduction). In addition to the two aforementioned options, SCHOTT reserves the right to demand compensatory damages.

e)    Any goods delivered must be free and clear of third party rights. In the event that computer programs are delivered, the Supplier warrants that it will have all the necessary rights – specifically intellectual property rights – for delivering the program to others.

f)    Unless individually agreed otherwise, the warranty period for any defects in quality will be 24 months following the passage of risk in accordance with Section 9 a). The warranty period will be tolled for the period from SCHOTT’s despatch of any defect notice to its receipt of any conforming good or service. With respect to any cured or substituted part of the good or service delivered or repeated, the period defined in sentence 1 above will recommence to run upon the receipt of the conforming good or service.

g)    SCHOTT reserves any statutory claims or rights, which it may have as a customer.

If the customer provides goods or services of substantially the same or similar nature which, despite repeated written notices by SCHOTT, are again defective or late, the right to cure shall be deemed unreasonable and SCHOTT will be entitled to immediately rescind the agreement, namely also with respect to such goods or services that the Supplier will be obligated to render based on previous or other contractual relations to SCHOTT in the future.

13. Indemnification in the Event of Quality or Title Defects:

The Supplier shall indemnify SCHOTT with respect to any and all claims that third parties – on whatever legal grounds – may have against SCHOTT based on defects in the quality or title of the good or service or any other defects, and agrees to reimburse SCHOTT for any necessary costs arising from the enforcement of such claims.

14. Technical Documents, Tools, Manufacturing Resources:

a)    Any technical documents, tools, drawings, plant specifications lists, etc. stemming from SCHOTT constitute the intellectual property of and are the subject of rights of authorship or copyrights held by SCHOTT. To the extent required for executing and settling the order, SCHOTT grants the Supplier for a limited term a non-exclusive license to the aforementioned rights of authorship or copyrights, which license shall terminate once the order has been settled.
SCHOTT shall retain exclusive ownership of any technical documents, tools, plant specifications list, manufacturing materials, etc., which it has made available. SCHOTT shall likewise retain all authorship or copyrights therein. Such material, together with any duplicates made, shall be returned to SCHOTT immediately after executing the order without SCHOTT having to request the Supplier to do so. In this respect, the Supplier will have no right to enforce any right to withhold performance vis-à-vis SCHOTT. The Supplier may use the aforementioned items only in connection with carrying out the order and may not disclose such items to unauthorised third parties or otherwise provide access thereto. Any copying or reproduction of the aforementioned items may be carried out only to the extent that it is absolutely necessary for discharging the order placed by SCHOTT.

b)    If the Supplier - on behalf of SCHOTT - produces the items set forth in 14 a) either in whole or in part at SCHOTT's expense, then Section 14 a) will apply accordingly. In this case, SCHOTT shall participate in the production costs on a pro rata basis and will acquire co-ownership rights in the items, which the Supplier will gratuitously hold in custody for SCHOTT. SCHOTT may, however, at any time acquire the rights related to the item subject to reimbursement of any expenses not yet amortised and may demand possession of the item from the Supplier.

15. Materials Set Aside:

a)    SCHOTT shall retain ownership in any materials it has set aside, and the Supplier shall gratuitously hold such materials in accordance with the standard of care exercised by reasonable business persons and must segregate such materials from the Supplier’s own property and identify them as SCHOTT's property. Such materials may be used only for the purpose of carrying out the order issued by SCHOTT.

b)    In the event the Supplier processes the material set aside by SCHOTT or restructures such material, then any such action shall be deemed to have been made exclusively for SCHOTT . SCHOTT will become the direct owner of any new item of property created therefrom. If the material set aside comprises only a part of the new item of property, then SCHOTT will become co-owner in this new property item in accordance with the share representing the value of the material set aside by SCHOTT.

16. Confidentiality:

a)    The Supplier covenants to treat as a trade secret any and all information and knowledge it receives in connection with the submission of an offer or with the issuance of an order by SCHOTT and agrees not to disclose such information or knowledge to third parties, unless the Supplier can prove to SCHOTT that it was aware of such information at the time the offer was submitted or that such information was subsequently made available to it by an authorised third party not subject to a confidentiality covenant or that such information had become generally subsequently available without the Supplier having caused or being responsible for such disclosure.

b)    The manufacturing for third parties, the presentation of products specifically manufactured for SCHOTT – including those made on the basis of SCHOTT designs or manufacturing specifications, any publication relating to the goods and services for which the order was given, and a reference to an order issued by SCHOTT to a third parties is subject to the prior express written consent of SCHOTT.

17. Severability:

Should any provisions of this contract be or become invalid, then such invalidity shall not in any way affect the validity of the purchasing terms and conditions set forth above.

18. Place of Performance, Judicial Forum, Governing Law:

a)    Place of performance is the place indicated in the delivery address.

b)    If the Supplier is a merchant, then at SCHOTT's option the judicial forum will be the competent court in either Mainz or Munich. In addition, SCHOTT is also entitled to institute legal action in the judicial forum of the Supplier.

c)    The substantive law of the Federal Republic of Germany shall govern this contractual relationship, except for the reference rules under its provisions relating to private international law.

19. Contract Modification:

Once an order has been placed any modification or addendum thereto must be made in writing. Any derogation from this rule must likewise be in writing.

20. Labelling of goods requiring an export license:

Labelling will indicate and give the customs charge number as well as the number from the German export list.
In addition your order confirmation or invoice will draw attention to the items requiring an export license or which are subject to US export regulations and apart from the relevant export list number will also let us know the customs code number.
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