Terms and Conditions of Sale

Terms and Conditions of Sale of Festo (China) Ltd.

1. General

1.1 All deliveries and services from Festo (China) Ltd., including the sale of software, are subject to the following terms and conditions of sale. Any conditions in any order given by any customer which are inconsistent with these conditions are expressly revoked. Such conditions shall not be legally binding for Festo unless they have been agreed to in writing by Festo.

1.2 The use of Festo software and customised software is subject to separate software user conditions.

1.3 The placing of an order or acceptance of goods delivered by Festo shall constitute the customer‘s agreement to our conditions.

2. Quotation and delivery

2.1 The goods and services displayed on the Festo Online Shop do not constitute an offer to conclude anagreement, but only represent an invitation to the customer to place a purchase order.

2.2 All quotations unless limited in time (e.g. the quotation of CS project) are subject to confirmation; ourwritten order confirmations shall form the basis of the contract and the definitive factor for the scope ofthe delivery. This also applies if the customer has requested a specific tender. Orders given by thecustomer are binding for the customer and shall be deemed to have been accepted upon presentationof the order confirmation by Festo. This shall be deemed to have been presented in due time in the caseof catalogue components if presented together with the issued invoice and the delivery. In the case ofquotations with a time limit and a time stated for acceptance, the quotation shall not be binding, if anorder confirmation is not submitted in time. Festo reserves the right to vary the design and make changesto technical data and performance characteristics for the purpose of technical progress insofar as thesedeviations are in accordance with industry practice, or if the changes are not substantial and it isreasonable for the customer to accept them. The above rights also apply to the choice of materials andspecifications. Festo will announce any such changes, and any product discontinuations, with anappropriate period of notice in its pneumatics catalogue on the Festo website (www.festo.com).

2.3 Any documentation submitted with the request for tender or an order, such as drawings, specifications,material, samples, tools, models or similar and made available to Festo, shall remain the property of thecustomer. These are binding for the preparation and issue of the Festo quotation. Any subsequentvariations relating to the initial request for tender and the Festo quotation must be specified in writingwhen ordering.

2.4 Any documentation added by Festo to a quotation in a manner similar to that mentioned above shallremain the property of Festo. The customer undertakes not to use this documentation for the purpose ofany other contracts or to reproduce or make it available to third parties.

2.5 Any apparent mistakes, printing, computational, spelling or calculation errors shall not be binding forFesto and do not give the customer the right to claim for damages.

2.6 Insofar as Festo have documentation (e.g. manuals) for particular products, this will be available tocustomers as a free-of-charge download from the Festo website (www.festo.com). Printed versions ofthis documentation can be provided for customers to separate order and for an additional charge.

3. Prices and payment

3.1 Prices apply based on the order confirmation. If the prices on the order do not include VAT, the VAT shallbe included in the invoices.

3.2 Unless agreed otherwise, the despatch and packaging costs shall be met by the customer. Festo reservesthe right to implement price changes if the basis for our calculations has been altered.

3.3 The invoice amount consists of contract price and VAT.

3.4 Assembly and repair costs and product information costs are payable net.

3.5 In the case of orders with a net goods value of less than RMB 800 yuan, Festo will add a small-ordersurcharge at RMB 50 yuan.

3.6 The customer is obligated to make full payments within the agreed period. The withholding of paymentsor offsetting of potential counterclaims is not permissible other than in the case of recognised or legallydetermined counterclaims.

3.7 If payment is overdue, Festo reserves the right to claim damages or surcharges resulting thereof. If thepayment is overdue for more than 30 days, Festo also reserves the right to cancel the credit periodgranted to the customer. All debt shall be fully paid up before subsequent order. Festo shall also beentitled to suspend all orders placed by the customer and its affiliates until full payment.

4. Delivery period

4.1 The date specified in the order confirmation is binding only if all the technical and commercial detailshave been clarified by that time. The proper performance by the customer of its obligations or guaranteesas agreed is the prerequisite for Festo's compliance with delivery times. The customer undertakes toprovide the materials essential for the order to be executed on time. The delivery date is deemed to havebeen adhered to, if the object of delivery has left the Festo works by the said date or if the customer hasbeen advised of its readiness for shipment.

4.2 Partial and early deliveries by Festo are permissible.

4.3 Compliance with the delivery time shall be subject to the prerequisite that Festo itself is properlysupplied, in particular on time, unless Festo is responsible for the delivery to itself not being undertakencorrectly. If the preconditions are not met, Festo shall be entitled to cancel the contract or order in wholeor in part without liability.

4.4 If despatch is delayed at the request of the customer, Festo shall after a reasonable period of time beentitled to dispose otherwise of the delivery item or to supply the customer to a correspondinglyextended time limit and to charge the customer storage costs.

5. Acceptance

Customer shall inspect the type, quantity, package, surface quality, specification, etc. within 24 hours afterthe goods arrive the place agreed by both parties according to the provisions of the contract and order, andaccept the goods. If customer doesn’t file a claim or fails to accept the goods within the specified time, it shallbe deemed to have accepted the goods.

6. Passage of risk

6.1 All deliveries shall be effected at the risk of the customer. Partial and early deliveries shall also be at the risk of the customer upon despatch or upon communication of readiness for shipment. This also applies if the consignment is transported by Festo and even if Festo uses its own vehicles and effects the installation.

6.2 At the request of the customer, Festo shall arrange at the customer’s expense insurance of the consignment against theft, breakage, transport, fire and water damage and any other insurable risks.

7. Retention of ownership

7.1 The goods supplied shall remain the property of Festo until all debts owed by the customer are settledin full including any balances existing from the business relationship with the customer irrespective ofstatutory source. The enforcement of our right to retain ownership should not be regarded as awithdrawal from contract. On the contrary, it ensures our rights from the contract of sale in addition toFesto’s entitlement to the return of Festo’s property, in particular to the reimbursement of damages andlost profits.

7.2 Notwithstanding the provisions of the preceding paragraph, the ownership of the changed and returnedgoods shall automatically be transferred to Festo from customer regardless of the cause.

7.3 All relevant Intellectual Property rights related to the goods shall still be owned by the licensor after theownership of the goods has been transferred to the customer.

7.4 In the event of the customer not conforming to the contract, in particular in the case of a delay in payment,the total balance due shall become payable immediately. In such cases, Festo has the right to recoverpossession of the goods following a demand for payment and to collect these from the customer’spremises. In such an event, the customer shall not have any right to ownership.

8. Use of software

8.1 In return for remuneration, the customer shall receive non-exclusive, non-transferrable and perpetualutilisation rights for Festo software of all kinds and any associated documentation. The customer islicensed to use the software only for the specific hardware product, and an installation on or use foranother hardware product is not permitted.Use in the sense of the license means loading, displaying,running, transferring and storing the software for the purpose of executing it and processing data. Festoshall remain the owner of copyrights and all other industrial property rights. No part of this softwaremust be duplicated other than for the purpose of data backup. Copyright notices must not be removed.

8.2 Festo will supply installation and commissioning instructions containing relevant safety instructions forits software in printed form. All other documentation will be supplied only in digital form with on-linehelp. When new software releases are supplied, these will also be sent in digital form.

8.3 The customer is authorised to make a backup copy of the software and the corresponding documentationon separate data storage devices, which shall be labelled with the original labelling from Festo (includingthe copyright mark). Use of the backup copy is only permitted in the case of deterioration or destructionof the copy originally acquired by the customer and only for the specific hardware product to which thesoftware is assigned. The customer is also subject to the above provisions with regard to the use of thebackup copy. In other respects, the customer shall not be entitled, without Festo's consent, to makefurther copies of the software and/or documentation or parts thereof, to install them on and/or use themfor certain or other hardware.

8.4 Without the prior written consent of Festo, the customer shall not be entitled to edit, change or otherwisemodify the software, use it in conjunction with devices other than the specific hardware product, reverseengineer (decompile) it in another form of representation, remove, circumvent or modify any copyprotection mechanisms, program elements serving digital rights management (DRM), security codes orfeatures serving to identify the software or to remove any information in the software and the associateddocumentation about the manufacturer's properties, copyrights or other property rights of Festo withoutthe prior written consent of Festo.

8.5 The transfer of software to third parties requires the permission of Festo and the third party must agreetocomply with this Terms and Conditions. In any case the customer shall be jointly and severally liablefor the losses caused by such third party's breach.

8.6 In the event of a violation of Section 8 of this Terms and Conditions, the purchaser shall pay a contractualpenalty amounting to ten times the order value. This contractual penalty shall not be set off against anypotential claims for compensation. The software and associated documentation must be returnedimmediately on request.

8.7 The conditions described above do not apply to exclusive customer-specific software developed on thebasis of specifications provided by the customer. This software is developed and customised by Festoas part of a contractually produced complete control system making use of modular software modules(standard software modules) from Festo suitable for a wide range of applications and adapted to thecontractual performance requirements.

8.8 Section8.2 does not apply to customised training software. Upon full payment of the purchase price ofthe customised software Festo shall transfer the exclusive, spatially unlimited and perpetual rights ofutilisation to the customer, without the customer having any lawful entitlement to the individual basicstandard software modules forming the basis of the customised version. Festo has the right, irrespectiveof these conditions, to create and offer similar software solutions for other customers. Festo shall retainbasic utilisation rights for internal purposes.

8.9 For customised software, Festo shall warrant compliance with the functions and features stipulated inthe specifications, the Festo order confirmation or acceptance letter, documentation or the jointlydefined work/procedure descriptions.

8.10 In the event of error occurring, the customer shall be obliged to provide Festo with all informationnecessary for error analysis and subsequent performance and to grant Festo or the personscommissioned by Festo unrestricted access to the software and the system of the customer on which itis installed. An error message shall contain information about the type of error, the application in whichthe error occurred, and the work performed to correct the error. If Festo carries out an error analysis atthe customer's request and it turns out that there is no error which Festo is obliged to remedy, Festo caninvoice the customer for the corresponding expenditure on the basis of Festo's applicable hourly rates.

8.11 Festo shall not be liable for errors in the software,
a) which have been caused by application errors on the part of the customer and which could have beenavoided if the program documentation had been consulted carefully; this also applies to non-existentor insufficient backup measures;
b) due to the actions of a virus or other external influences for which Festo is not responsible, such asfire, accidents, power failure, etc.;
c) which are based on the fact that the software was used in connection with a hardware product otherthan that specified by Festo or in an operating environment other than that approved by Festo, or areattributable to faults in the hardware, the operating system or computer programs of othermanufacturers which the customer uses in connection with the software;
d) which are based on the fact that the software was changed by the customer or a third party without authorization. Furthermore, Festo shall not provide any warranty for components or modules supplied free of chargeby other manufacturers (third-party software), in particular open source software, which can be used inconnection with the software provided by Festo.

9. Returned goods

No returns for goods will be allowed without Festo's prior written acceptance. Credit will be based upon pricesof products in effect at time of return or time of invoicing. In the event of return, Festo reserves the right toimpose a minimum charge on returned goods which is subject to shipping, handling, re-inspection and anyadditional expense incurred in restoring goods to saleable condition, as determined by our inspection.Unauthorized returns are at the customer's own risk and expense.

10. Warranty claims

Festo warrants its products to be free from defects in materials and workmanship, for a period of 12 months from date of delivery to the customer. Subject to the provisions in Article 14 herein and excluding any further claims, Festo shall be liable for defects of quality and legality of title and warrants as follows:

10.1 Defects of quality:

a) All parts found to be defective as a result of circumstances prior to the transfer of risk shall, at the discretion of Festo, either be repaired or replaced by delivery of a faultless part. Excluded from this warranty shall be parts subject to wear.

b) Festo shall guarantee that Festo software has been duplicated properly. Festo software is designed to run on hardware products specified by Festo. Warranty claims shall be satisfied by means of a replacement. Unless otherwise agreed in writing, Festo shall not warrant that the software and its data structure are free of defects.

c) In case of customised software, Festo shall warrant compliance with the functions and features stipulated in the specifications, the order acknowledgement, documentation or the work/procedure descriptions worked out together between Festo and the customer. Festo shall not warrant that such programs are free of defects in relation to the use of said programs in all applications intended by the customer, in particular not such applications of which Festo was not aware or did not test at the time of development/acceptance.

d) The defects shall be notified immediately in writing, however, at the latest within 8 days after receipt of goods.

e) If the defect complaint is justified, Festo shall bear of the immediate costs – insofar as the complaint proves to be founded – the cost of the replacement part, shipping thereof as well as reasonable costs related to uninstallation and reinstallation, insofar as such procedure does not result in unreasonable demands made on Festo.

f) The customer shall allow Festo time and opportunity to effect the repair or replacement delivery, otherwise Festo shall not be held liable for the ensuing consequences. The customer, with Festo’s prior consent, shall have the right to rectify defects itself or have them rectified by a third party in such urgent cases where there is a danger to operational safety and to prevent extensive damage, and to claim reimbursement of necessary costs from Festo. This shall also apply in the cases where Festo is causing undue delay in remedying the defect. Should the customer or a third party carry out unqualified repairs, Festo shall not be held liable for any consequences thereof.

g) Other claims shall be determined as stipulated in Article 14 herein.

h) In addition, Festo shall not be held liable for any damage on foot of the following grounds: unsuitable or improper use or storage, faulty installation by the customer or a third party, unauthorised repair attempts and modifications, natural wear, erroneous or negligent handling, chemical effects and electrical effects etc. outside our power, as well as in case of non-intended use and non-compliance with our information and details out of our documentation (e.g. user manuals, catalogue sheets), irrespective of the method of such information, in particular in relation to the conditions of use of our products (e.g. lubrication instructions, quality of pressurised air/of other operational requirements, environmental conditions). In addition, the warranty shall be voided if the customer or third parties modify the control/software without Festo’s prior consent and without any other justification (Festo’s undue delay in remedying defects), even if the error occurs in an unchanged component.

10.2 Defects of title:

a) If the use of the delivery item infringes other’s industrial property rights or copyrights, Festo shall, at its cost, obtain the right to principally enable the customer to continue to use the delivery item or to modify the delivery item in a manner acceptable to the customer so that the copyright infringement no longer exists.

b) Should this not be achievable in an economically reasonable manner or within a reasonable period of time, the customer shall be entitled to withdraw from the contract. Given the stipulated conditions, Festo also shall have the right to withdraw from the contract.

c) In addition, Festo shall indemnify the customer in relation to any non-disputed claim or legally asserted claim raised by the relevant copyright owners.

d) Subject to Article 14 herein, the above stated obligations of Festo shall be final in relation to cases of infringement of property rights or copyrights. The aforesaid obligations shall be applicable only if the customer advises any property or copyright infringement claims raised immediately to Festo, the customer reasonably supports Festo in the defence of such claims or enables Festo to carry out modifications, Festo has at its disposal all defence actions including out-of-court settlements, the defect of title is not based on an instruction issued by the customer and the infringement is not caused by non-authorised modifications of the delivery item by the customer or non-authorised use of the delivery item by the customer.

11. Resell

Unless Festo has given a prior consent in writing, the supplied goods can only be used to manufacturecustomer’s own products, and the customer is not allowed to resell the supplied goods, directly or indirectly,to any third party, including resell the component(s) removed from the goods. If customer voilates this termor Festo has reasonable grounds for doubt of customer’s voilating this term, Festo has the right to refuse toaccept customer’s orders and cancel all or any part of the order placed by the customer and its affiliateswithout liability, Under such circumstances, customer shall compensate for all losses incurred to Festo. Thecustomer shall remain liable for make payment for goods delivered unless expressly permitted by Festo inwriting.

12. Export control

12.1 The parties agree that the goods shall be delivered subject to all applicable export controls or restrictions imposed on technology and products by any country or organisation or nation, including the China, United Nations, European Union and United States, which are enforceable in the jurisdiction of Festo. The cusotmer acknowledges that the goods and all related technical information, documents and materials may not be imported or exported, re-exported, transhipped, traded, diverted or transferred, directly or indirectly, contrary to such controls or restrictions.

12.2 On Festo’s request, the customer shall furnish Festo with all relevant certificates relating to export control laws, regulations and restrictions, such as, but not limited to, end-user certificates, in form and content specified by Festo.

13. Impossibility of performance, default

13.1 The customer may withdraw from the agreement should performance by Festo become impossible before the risk is passed. The customer shall also be entitled to withdraw from the agreement should, in the case of an order for similar goods, execution of part of the delivery become impossible and the customer has a legitimate interest in refusal of a partial delivery. Should this not be the case, the customer may reduce the consideration accordingly.

13.2 In the event of a delay of performance by Festo as defined by Article 4, where the customer guarantees us a reasonable extension, the customer shall be entitled to withdraw from the agreement, within the scope of the statutory provisions, should the extension not be complied with. Should there be a delay of acceptance through the fault of the customer, the customer shall remain obliged to render a return service.

13.3 Should the customer incur damage caused by a delay for which Festo is responsible, the customer shall be entitled to claim liquidated damages for default. This liquidated damages shall amount to, for each full week of the delay and to the exclusion of further claims, 0.5 % and aggregately no more than 3 % of the value of the delayed part of the delivery.

13.4 Further claims as a result of late delivery shall be expressly excluded.

13.5 Customer hereby agrees to fully compensate Festo and hold Festo harmless from any losses, damages, costs, expenses, liabilities or claims arising out of customer’s voilation of this Terms and Conditions of Sale of Festo (China) Ltd.

14. Liability

14.1 The customer shall not modify or remove existing warnings about dangers arising from improper use ofthe products. If the customer modifies the product or uses the product for purposes other than those forwhich it was intended, this shall be at the customer's own risk.

14.2 In the event of a breach of the obligation according to Section 14.1 sentence 1 and if the customermodifies the product or uses the product for purposes other than those for which it was intendedaccording to Section 14.1 sentence 2, the customer shall indemnify Festo internally against all resultingclaims by third parties, irrespective of the legal grounds, unless the customer has acted without fault.

14.3 Festo is prompted to recall or warn of a product due to a product defect in the products, or if Festo deemsa product recall to be indicated for safety reasons, the customer shall cooperate to the best of his or herability in the measures which Festo considers necessary and expedient and which support Festo in this,in particular in determining the necessary customer data.

14.4 The customer shall immediately inform Festo in writing of any risks that become known to him or herwhen using the products and of possible product defects.

14.5 In any event, and whatever the cause of action, Festo’s maximum total liability to the customer pursuantto and in connection with this Agreement – including the obligation to pay penalties, liquidated damagesand regardless of cause, degree of fault, negligence, breach of contract or otherwise – shall be limited toone third (1/3) of the individual order value in respect of which the cause of Festo’s liability has arisen.

14.6 In no event shall any pursuant to this Agreement Festo be liable to any party for any indirect or otherconsequential damages including but not limited to, any loss of revenue, loss of profits, loss ofanticipated benefits and savings, loss of business interruption, loss of contracts or businessopportunities, loss of goodwill, loss or corruption of data, loss of investment and opportunity cost, claimsof third parties and all associated and incidental costs and expenses etc.

14.7 Festo shall not be liable for defects other than to the delivery item, for whatever legal reasons, only incase of intent, gross negligence of bodies or executives, culpable violation of life, body, health, defectswhose presence was not disclosed by Festo or its managerial personnels maliciously or their absenceguaranteed by Festo, as well as in case of delivery item defects to the extent as liability is provided underthe product liability law for personal injury and property damage in relation to privately used items.

14.8 Any further claims shall be expressly excluded.

15. Statute of limitation

The statute of limitation for any and all claims, no matter what legal reason, shall be consistent with the relevant provisions of the law of PR. China.

16. Confidentiality

The customer undertakes to treat all information, know-how and other industrial secrets in connection with the execution of the respective order in strict confidence and not to pass on or make available any information, documents, documentation, drawings, sketches or other papers to third parties without the express permission of Festo. Festo shall also treat all customer documentation in confidence.

17. Assignment

17.1 Festo shall not be liable for any partial or total non-performance of its obligations if such nonperformanceisdueinwholeorinparttocircumstanceswhichcouldnothavebeenforeseenatthetime
of the conclusion of the purchase contract and which cannot be remedied by Festo by reasonable means("Force Majeure"). In any case, the following events shall be considered as Force Majeure: strikes, riotsand civil commotions, war (declared or undeclared), piracy, terrorist threats, acts of sabotage, fires,floods, earthquakes and natural disasters, epidemics and pandemics, acts of government or if the abovecircumstances affect subcontractors of the Festo.

17.2 In the event of a Force Majeure Event, the obligations of Festo under the relevant purchase contract shallbe suspended for as long as the effect of the Force Majeure event lasts plus a reasonable restart periodthereafter. If the Force Majeure event last for a period longer than 90 days, Festo is entitled to withdrawfrom the contract.

18. Place of jurisdiction

The Pudong People’s Court in Shanghai, China, shall be the competent court of jurisdiction for all disputes arising from the contractual relationship.

19. Applicable law

The law of the People’s Republic of China shall apply to the contractual relationship between Festo and the customer to the exclusion of all bi and/or multilateral agreements concerning the purchase of movables, in particular to the exclusion of the UN agreement relating to contracts regarding the international purchase of goods of 11.04.1980 (CISG).

20. Compliance

The Customer warrants that he or she has been informed of the Festo Code of Conduct for Business Partners, which can be downloaded from https://www.festo.com/group/de/repo/assets/pdf/corporate/Festo-Code-of-Conduct-Business-Partners_EN.pdf, and has instructed his or her managers and employees to comply with it.To secure this good conduct the Customer shall undertake any necessary step to avoid any illegal actions, especially to avoid illegal actions which would adversely affect Festo.Therefore within his or her company and/or group the Customer shall take any necessary actions needed to monitor compliance with the Festo Code of Conduct for Business Partners by his or her managers and employees, especially such actions which are essential to avoid corruption or any other criminal acts.