Terms of Purchase of the UK-Based Companies of the MAHLE Group
1. Interpretation

2. Basis of Purchase

1.1 In these Terms:“Affiliate” means a company within a “group” asthat expression is defined in Section 1261 of theCompanies Act 2006

2.1 An Order is only open for acceptance on theseTerms and constitutes an offer by the Buyer topurchase Goods and/or acquire Services subject tothese Terms.

“Buyer” (if not stated in the Order) means the
UK-based company of the MAHLE Group thatplaced the order;

2.2 These Terms shall apply to each Contract to the
exclusion of any other terms on which any quotation has been given to the Buyer or subject towhich the Order is accepted or purported to be
accepted by the Seller.

“Contract” means a contract for the sale andpurchase of Goods and/or the supply and acquisition of Services;“Delivery Address” means the address for delivery (if any) stated on an Order;“Goods” means goods (including any instalmentof the goods or any part of them) described in an
Order;“Intellectual Property Rights” shall include but
not be limited to design rights, patents, knowhow, registered designs, copyright, moral rights,
utility models and all similar or analogous rights
in any part of the world“Order” means a Buyer’s purchase order towhich these Terms are annexed;

2.3 The Seller’s written acceptance or commencement of any work or service under an Order shallconstitute an acceptance of these Terms.
2.4 If an Order is not unconditionally accepted by
the Seller in Writing within seven days of its date, itwill lapse unless at any time agreed otherwise by
the Buyer.
2.5 No variation to an Order or these Terms shallbe binding unless agreed in Writing between theauthorised representatives of the Buyer and theSeller.
2.6 In case of conflict between these Terms and theOrder the latter shall prevail.
3. Specifications“Price” means the price of Goods and/or charge
for Services in respect of an Order“Seller” means the person so described in theOrder;“Services” means the services (if any) describedin the Order;“Specification” includes any plans, drawings, dataor other information relating to Goods or Services and (unless the context otherwise requires)
whether supplied by the Buyer to the Seller, or
specifically produced by the Seller for the Buyer
in connection with a Contract;“Terms” means the standard terms and conditions of purchase set out in this document;“Writing”, and any similar expression, includes
facsimile transmission and comparable means ofcommunication [but not electronic mail].
1.2 Where an Order includes the Seller’s handbook, manual and/or quality guidelines, such
Order will be deemed to include the same and sothat without limitation such Order will not be
fulfilled unless the full amount of such items aredelivered to the Buyer by the Seller.
1.3 Any reference in these Terms to a statute or aprovision of a statute shall be construed as areference to that statute or provision as amended, re-enacted or extended at the relevant time.
1.4 The headings in these Terms are for convenience only and shall not affect their interpretation.
© MAHLE, 2019

3.1 The quantity, quality and description of Goods
and Services shall, subject as provided in theseTerms, be as specified in the Order and/or in any
applicable Specification supplied by the Buyer tothe Seller or agreed in Writing by the Buyer. The
Buyer shall not be bound to accept delivery ofGoods in excess or below the number of thosesubject to an Order or Contract and may at its sole
unfettered option accept part delivery of Goods
whilst treating the failure to supply the balance
subject to a contract as a breach of that contract.
3.2 The Seller shall comply in full with all applicable regulations and/or other legal requirements,
including without limitation the requirements of
the Buyer concerning the manufacture, packaging, packing and delivery of Goods and theperformance of Services and the environment,
the Modern Slavery Act 2015 [and the Bribery Act
2010] and the General Data Protection Regulation(GDPR) (EU) 2016/679. The Seller shall undertakea prior and timely discharge of the obligations
established by the Regulation (EC) No 1907/2006of the European Parliament and of the Council of
18 December 2006 concerning the Registration,
Evaluation, Authorisation and Restriction ofChemicals (REACH) and any replacements oramendments thereof. The Buyer shall in no way
be responsible for the registration of the purchase of chemicals. The Seller confirms thenecessity of a prior registration of the object ofpurchase for a legally admissible delivery andaccepts the obligation to compensate the Buyer
for all losses and damages resulting from a breachof law established by REACH (and all and any
replacements or amendments thereof) and which
relate to Goods.

3.3 For production supply, Initial Samples shallbe produced in compliance with the latest
version of VDA Volume 2 ‘Quality Assurance
for Supplies’ and/or the latest version of PPAP
and/or any specific customer defined requirements. In addition, the Seller shall enter allmaterial data in the IMDS material database(International
Material
Data
System,www.mdsystem.com); the approval and accepted IMDS entry for all relevant material
data is a component and precondition of eachsuccessful approval.
3.4 The Seller shall not unreasonably refuse
any request by the Buyer to inspect and test
Goods during manufacture, processing or
storage at the premises of the Seller or any
third party prior to despatch, and the Seller
shall provide the Buyer with all facilities reasonably required for inspection and testing.
3.5 If as a result of inspection or testing theBuyer is not satisfied that Goods will comply inall respects with a Contract, and the Buyer so
informs the Seller within seven days of inspection or testing, the Seller shall take such steps
as are necessary to ensure compliance.
3.6 Goods shall be marked and packaged inaccordance with the Buyer’s instructions andany applicable regulations or requirements ofthe carrier, and properly packed and secured
so as to reach their destination in an undamaged condition in the ordinary course.
4. Price of the Goods and Services
4.1 Subject to 4.3 and 4.4 below the Price ofGoods and Services shall be as stated in an
Order and, unless otherwise so stated, shallbe:
4.1.1 exclusive of any applicable local taxes(Value Added Tax) (which shall be payable by
the Buyer subject to receipt of a VAT invoice
where applicable); and4.1.2 inclusive of all charges for packaging,packing, shipping, carriage, insurance anddelivery of the Goods to the Delivery Address and any applicable duties, imposts orlevies other than value added tax.
4.2 No increase in the Price may be made(whether on account of increased material,
labour or transport costs, fluctuation in rates of
exchange or otherwise) without the prior consent of the Buyer in Writing.
4.3 The Buyer shall be entitled to any discountfor prompt payment, bulk purchase or volume
of purchase customarily granted by the Seller,
whether or not shown on its own terms of sale.
4.4 The Seller undertakes with the Buyer toensure that the Price of Goods and Services willat all times notwithstanding an Order or contract to be at the lowest price at which theSeller has supplied or agreed to supply such orsimilar goods and/or services to third parties at1

any time during the period of [one month]
before the relevant Order or Contract and final
fulfilment of such Order or Contract.
4.5 The Buyer shall upon reasonable notice fromtime to time make available and procure that its
own suppliers make available to the Buyer and its
agents its and their accounting records and otherdocuments which the Buyer requires to establish
whether or not the Seller is in breach of any of
the obligations hereunder and shall permit the
Buyer and its agents to take copies of the sameat the Buyer’s expense.
5. Terms of Payment
5.1 The Seller may invoice the Buyer on or at any
time after delivery of Goods or performance ofServices, as the case may be, and each invoice
shall quote the number of the Order.
5.2 Unless otherwise stated in the Order, theBuyer shall pay the Price of Goods and Services
60 days after the end of the month of receipt by
the Buyer of a proper invoice or, if later, after
acceptance of Goods and Services in question by
the Buyer.

6.7 The Seller shall supply the Buyer in good timewith any instructions or other information required to enable the Buyer to accept delivery ofGoods and performance of Services.

8. Warranties and Liability
6.8 The Buyer shall not be obliged to return to
the Seller any packaging or packing materials for
Goods, whether or not any Goods are acceptedby the Buyer.
6.9 If the Goods are not delivered or the Services
are not performed on the due date (including
without limitation delivery or performance before due date) then, without limiting any otherremedy, the Buyer shall be entitled to deductfrom the Price or (if the Buyer has paid the Price)
to claim from the Seller the liquidated damages
ensuing.
6.10 If any Goods are rejected by the Buyer the
Seller shall at its expense forthwith collect thesame or the Buyer may at its option return thesame to the Seller at the cost (including without
limitation packaging and repackaging) and risk of
the Seller.

7.1 Risk of damage to or loss of Goods shall passto the Buyer on delivery to the Buyer in accordance with the Contract.

6. Delivery

7.2 The ownership of Goods shall pass to the
Buyer on delivery, unless payment for Goods ismade prior to delivery, when the ownership shallpass to the Buyer once payment has been madeand Goods have been appropriated to the Contract.

6.2 Where the date of delivery of Goods or of
performance of Services is to be specified after
the placing of the Order, the Seller shall give tothe Buyer reasonable notice of the specified
date.
6.3 The time of delivery of Goods and of performance of Services is of the essence of every
Contract.
6.4 A packing note quoting the number of theOrder must accompany each delivery or consignment of Goods and must be displayed prominently.
6.5 If Goods are to be delivered, or Services areto be performed, by instalments, the Contract
will be treated as a single contract and not severable.
6.6 The Buyer may reject any Goods delivered
which are not in accordance with a Contract, andshall not be deemed to have accepted any Goods
until the Buyer has had a reasonable time toinspect them following delivery or, if later, withina reasonable time after any latent defect inGoods has become apparent.

© MAHLE, 2019

8.1 The Seller warrants to the Buyer (and subject to any legal requirement it shall be a condition) that (notwithstanding any inspection ofor ability to inspect the same) the Goods andany goods or parts replacing the same as aresult of breach of warranty and/or condition:
8.1.1 will be of satisfactory quality (within
the meaning of the Sale of Goods Act 1979,
as amended) and fit for any purpose held out
by the Seller or made known to the Seller [inWriting] at the time the Order is placed;
8.1.2 will be free from defects in design, material and workmanship and will incorporate
the best technology then available to theSeller;8.1.3 will correspond with any relevant Specification or sample; and7. Risk and Property

5.3 The Buyer may set off against the Price anysums and/or liability owed by the Seller to the
Buyer or to an Affiliate of the Buyer.

6.1 Goods shall be delivered to, and Services shallbe performed at, the Delivery Address on thedate or within the period stated in the Order, ineither case during the Buyer’s usual business
hours

waives any objection to the Buyer’s repossession and removal of such Buyer’s Property orother items].

7.3 The Seller acknowledges that it has no property, interest or other rights in any tooling, plant,
equipment or other property of the Buyer (“Buyer’s Property”) that may be in its possession orcontrol. The Seller shall not create any encumbrance over any Buyer’s Property or transfer title
in any Buyer’s Property to any third party whatsoever nor use it for any purpose other than that
authorised by the Buyer.
7.4 The Seller shall indicate, mark or label all
Buyer’s Property in an appropriate manner as
being the property of the Buyer and shall (a)keep such items in good condition and adequately protected from damage, loss or theft; (b) refrain from commingling the Buyer’s Property
with property owned by the Seller or any third
party and (c) ensure that all Buyer’s Property isadequately insured whilst under the Seller’s
possession or control.
7.5 The Buyer may request the return of any
Buyer’s Property at any time and the Seller willpromptly return the Buyer’s Property to the
Buyer at such location as may be specified by
the Buyer following any such request. [TheBuyer shall be entitled to enter any of theSeller’s premises to obtain possession of theBuyer’s Property and/or any other items belonging to the Buyer and the Seller hereby

8.1.4 will comply with all statutory requirements and regulations relating to the sale of
the Goods;
8.1.5 will comply with all quality and certification requirements from time to time demanded by the Buyer.
8.2 Notwithstanding anything herein, where
there are serial defects such warranties andconditions mentioned above shall be unlimited
in time.
8.3 In respect of all and any component parts
obtained by the Seller from a third party forincorporation or use in connection with Goods,
to the extent that the Seller has received amore extensive warranty or remedy from suchsupplier in connection with such components
the Seller will extend to the Buyer such warranties and remedies applicable to such component parts to correspond with the warranties which the Seller receives and8.3.1 such extended warranties will be in addition to the warranties otherwise applicable; and8.3.2 the Seller shall observe all relevant
procedures to ensure preservation of its
warranties from its suppliers to the maximum extent.
8.4 The Seller warrants to the Buyer that theServices will be performed by appropriately
qualified and trained personnel, with due careand diligence and to such high standard of
quality as it is reasonable for the Buyer to
expect in all the circumstances.
8.5 Without limiting any other remedy, if any
Goods or Services are not supplied or per2

formed in accordance with the Contract, thenthe Buyer shall be entitled:
8.5.1 to require the Seller to repair Goods or
to supply replacement Goods or Services inaccordance with the Contract within sevendays; or
8.5.2 at the Buyer’s sole option, and whether
or not the Buyer has previously required theSeller to repair Goods or to supply any replacement Goods or Services, to treat theContract as discharged by the Seller’s breachand require the repayment of any part of thePrice which has been paid.
8.6 The Seller shall indemnify the Buyer in full
against all liabilities, loss (including without limitation loss of profit), damages, costs and expenses (including legal expenses) awarded against or
incurred or paid by the Buyer as a result of or inconnection with:
8.6.1 breach of any warranty or condition givenby the Seller in relation to the Goods or theServices and the reasonable costs of the Buyer
in handling all claims relating to or emanatingfrom any such breach of warranty and/or condition;
8.6.2 any claim that the Goods infringe, or theirimportation, use or resale, infringes, the patent, copyright, design right, trade mark orother Intellectual Property Rights of any otherparty, except to the extent that the claim arises from compliance with any Specification
supplied by the Buyer.
8.6.3 any liability under the Consumer Protection Act 1987 in respect of the Goods;
8.6.4 any act or omission of the Seller or its
employees, agents or sub-contractors in supplying, delivering and installing the Goods;
8.6.5 any act or omission of any of the Seller’s
personnel in connection with the performanceof the Services; and8.6.6 all costs (including without limitation notification of any party likely to be affected) ofrecalling and/or servicing any Goods which the
Buyer in its own unfettered judgement considers necessary and which results from a breachof warranty and/or condition by the Seller.
8.7 In case of any disagreement between the
Buyer and the Seller relating in any way to abreach or breaches of warranty and/or condition and all amounts payable in connection
therewith the same shall be determined by the
Buyer acting reasonably in all the circumstances.
8.8 Neither the Seller nor the Buyer shall be
liable to the other or be deemed to be inbreach of the Contract by reason of any delay
in performing, or any failure to perform, any of
its obligations in relation to the Goods or the© MAHLE, 2019

Services, if the delay or failure is beyond thatparty’s reasonable control. Without limiting
the foregoing, the following shall be regarded
as causes beyond either party’s reasonable
control:
8.8.1 Act of God, explosion, flood, tempest,
fire or accident;
8.8.2 war or threat of war, sabotage, insurrection, civil disturbance or requisition;

ture or use of equipment involved in the production or use of Goods.
10.3 Insofar as it is not possible to vest any
Intellectual Property Rights in the Buyer pursuant to 10.1, the Seller shall procure that the
Buyer shall have a royalty free right at all times
to use manufacture sell and deal in goods incorporating the same, which right shall befreely assignable.
11. Termination

8.8.3 (subject to 8.1.4 above) acts, restrictions, regulations, bye-laws, prohibitions
or measures of any kind on the part of any
governmental parliamentary or local authority;
8.8.4 import or export regulations or embargoes;
8.8.5 strikes, lock-outs or other industrial actions or trade disputes (but not involving
employees of the Seller or of a third party
supplying the Seller)

11.1 The Buyer may cancel an Order in respectof all or part only of the Goods and/or theServices by giving notice to the Seller at any
time prior to delivery or performance, in which
event the Buyer’s sole liability shall be to pay to
the Seller the Price for the Goods or Services inrespect of which the Buyer has exercised its
right of cancellation, less the Seller’s net savingof cost arising from cancellation. In the eventof a re-order of such Goods and/or such Services so cancelled a credit shall be given by the
Seller to the Buyer in respect of monies paid
pursuant to this Clause 11.1.

9. Seller’s Undertakings
9.1 The Seller undertakes with the Buyer:
9.1.1 not to use in connection with the supply
of goods to third parties tooling supplied by
the Buyer or manufactured or acquired in accordance with the Buyer’s instructions or as aresult of the Buyer’s specific requirements
contained in an Order.
9.1.2 for a period of 15 years following theBuyer ceasing to supply equipment to third
parties being Goods or incorporating thesame to deliver to the Buyer as the Buyer
shall require all spare parts for Goods at a
price no greater than that at which such parts
were then last supplied to the Buyer by the
Seller plus a reasonable amount to allow for
inflation.

11.2 The Buyer may terminate a Contract without liability to the Seller by giving notice to theSeller at any time if:
11.2.1 the Seller makes any composition or
voluntary arrangement with its creditors or(being an individual or firm) becomes bankrupt or (being a company) enters into administration or goes into liquidation (otherwise than for the purpose of amalgamation
or reconstruction), or a moratorium comes
into force in respect of the Seller (within themeaning of the Insolvency Act 1986); or
11.2.2 an encumbrancer takes possession, ora receiver is appointed, of any of the property or assets of the Seller; or
11.2.3 the Seller ceases, or threatens tocease, to carry on business; or

10. Intellectual Property Rights
10.1 The parties agree that insofar as possible
they shall respectively procure that all right title
and interest in Intellectual Property Rights
involved from time to time in the Specification,
manufacture and/or supply of Goods shall be
the exclusive property of the Buyer and theSeller insofar as it is possible assigns with fulltitle guarantee all such Intellectual Property
Rights for no further consideration, subject only
to payment of the Price. The Seller agrees atthe cost and request of the Buyer to do all suchother things and execute all such other documents as the Buyer shall require to vest thesame in the Buyer absolutely but in the meantime to hold the same on trust for the Buyer.
10.2 The Seller shall forthwith inform the Buyerof any matter which now or in the future shallinvolve a new invention or method of manufac-

11.2.4 the Buyer reasonably apprehends
that any of the events mentioned above isabout to occur in relation to the Seller andnotifies the Seller accordingly; or
11.2.5 an even occurs in a foreign jurisdiction which is analogous to any of the foregoing.
12. Insurance
12.1 The Seller shall at all times maintain adequate insurance in a sum not less than
£10,000,000 for business and product liability
and recall costs.
12.2 In addition if the Seller is to be involved invisiting the Buyer’s premises to supply Goods
and/or services the Seller shall at all times
maintain adequate public liability insurance3and employers’ liability insurance both in asum not less than £5,000,000.
12.3 The Seller shall at all times allow theSeller or its agent to inspect all insurance policies relating to 12.1 and 12.2.
13. General
13.1 The Buyer is a member of the group ofcompanies whose holding company is MAHLE
GmbH, and accordingly the Buyer may perform
any of its obligations or exercise any of its
rights hereunder by itself or through any othermember of its group, provided that any act oromission of any such other member shall bedeemed to be the act or omission of the Buyer.
13.2 The Order is personal to the Seller andthe Seller shall not assign or transfer or purport to assign or transfer to any other person
any of its rights or sub-contract any of its obligations under the Contract.
13.3 A notice required or permitted to begiven by either party to the other under theseTerms shall be in Writing addressed to that
other party at its registered office or principal
place of business or such other address as may
at the relevant time have been notified under
this provision to the party giving the notice.
13.4 No waiver by the Buyer of any breach of
the Contract by the Seller shall be considered
as a waiver of any subsequent breach of thesame or any other provisions.
13.5 If any provision of these Terms is held byany court or other competent authority to beinvalid or unenforceable in whole or in part thevalidity of the other provisions of these Terms
and the remainder of the provision in question
shall not be affected.
13.6 The Contract shall be governed by thelaws of England, and the Seller agrees to submit to the jurisdiction of the English courts, orif the Buyer shall so requires the Seller shallsubmit to the jurisdiction of the Courts of thejurisdiction in which the Seller is resident.
13.7 These Terms shall apply to Orders andContracts made until due notification of revised terms and conditions of purchase are
given by the Buyer to the Seller whereupon
such revised terms shall apply instead of theseTerms.
Status: June, 2019

© MAHLE, 20194