General Terms and Conditions of Purchase

General Terms and Conditions of Purchase of ilapo Internationale Ludwigs-Arzneimittel GmbH & Co. KG (AEB)

1. Scope of application, diverging general terms and conditions of business, future transactions, overriding agreements

1.1 The legal relations between us, ilapo Internationale Ludwigs-Arzneimittel GmbH & Co. KG, and Supplier are governed exclusively by these Terms and Conditions of Purchase. The version applicable from time to time may also be viewed by Supplier on the Internet at www.ilapo.de. Any general terms and conditions of business of Supplier conflicting with or diverging from these Terms and Conditions of Purchase shall not be accepted unless we have specifically and expressly agreed to them. In the case of continuous business relations these Terms and Conditions of Purchase shall also apply to all future transactions between Supplier and us.

1.2 Where a Quality Technical Agreement (QTA) is in place with Supplier, the provisions of such agreement shall prevail over these Terms and Conditions of Purchase. Any individually negotiated agreements with Supplier (including side agreements, amendments and changes) as well as any terms in our orders conflicting with these Terms and Conditions of Purchase shall also take precedence over these Terms and Conditions of Purchase.

2. Written form, orders, acceptance period

2.1 All orders and declarations of acceptance, amendments and any other subsidiary arrangements and agreements made prior to or at the time of conclusion of a contract must be in written form (letter, fax, email) to become legally effective.

2.2 Unless otherwise agreed a contract will become effective in that we place a binding order which is accepted by Supplier in writing or by delivering the goods ordered. Unless otherwise specified or agreed, we shall be bound to our orders for three weeks from the order date.

3. Delivery deadlines/periods, delay, duty of notification, retention and setoff by Supplier

3.1 Unless agreed otherwise, all agreed delivery deadlines and delivery periods are binding. Timely receipt of the goods by us determines whether or not a delivery deadline or delivery period has been observed.

3.2 In the event of a delay in delivery Supplier will compensate us for any losses incurred by such delay. Notwithstanding his potential liability for noncompliance with the agreed delivery deadline, Supplier is obliged to notify us in writing without delay of any foreseeable delays in delivery. This includes cases of force majeure, operational breakdowns, shortage in resources etc. Failure to notify us or to notify us in a timely manner will give rise to Supplier’s liability for any losses incurred by us as a result unless Supplier is not responsible for the failed or late notification.

3.3 Supplier may assert a right of retention in view of the delivery only if it is based on claims from the same contractual relationship which are uncontested, ready for a decision or established by final enforceable judgment. Any setoff by Supplier shall be excluded unless Supplier’s claim is uncontested, ready for a decision or established by final enforceable judgment.

4. Packaging/labelling, delivery, shipping/risk, shipping papers/invoices, cross-border deliveries

4.1 Unless agreed otherwise the deliverables shall be duly and properly packaged and labelled, in accordance with our instructions. Supplier shall be liable for damage incurred by us because Supplier packaged or labelled the goods improperly or contrary to our instructions, except where Supplier is not responsible.

4.2 Deliveries shall be effected DPU (Incoterms® 2020) our domicile at D-80639 Munich, Friedenheimer Brücke 21, on the condition that deliveries of medicinal products, in particular temperature-controlled transports, shall be carried out in accordance with the transport regulations of the Guidelines for Good Distribution Practice for medicinal products for human use (GDP Guidelines) as amended from time to time. If we bear the shipping costs, we are entitled to determine that UPS, FedEX, TNT, DHL, or any other suitable transport service provider shall carry out the transport and we will provide Supplier with our customer number at the respective service provider for the handling of the shipping; the risk of accidental loss and accidental deterioration of the goods up to their delivery to us will be borne by Supplier also in this case.

4.3 Shipping papers and invoices shall be enclosed with the shipments. All invoices have to be verifiable and indicate the value-added tax separately.

4.4 Supplier is obliged to forward to us in due time all necessary statements about the origin of the goods for customs purposes. If Supplier is domiciled abroad or imports goods, Supplier shall be responsible for the accuracy of the declaration of the goods. Where required, Supplier will prove his statements about the origin of the goods by an information sheet confirmed by Supplier’s customs office. In any event of Supplier’s fault, Supplier shall be liable for all disadvantages we sustain by an improper or late Supplier statement.

5. Safety standards, documentation, marketability/remaining shelf-life of goods

5.1 Supplier will observe the protective laws and other safety regulations applicable to the deliverables, e.g. requirements imposed by the industrial supervisory office, accident prevention rules of employers’ liability insurance associations. Supplier will apply for any necessary permits and file the required notifications with the authorities. Supplier shall enclose all necessary inspection certificates, permits and attestations with the deliveries without further request.

5.2 Unless agreed otherwise and subject to the provisions of section 5.3, Supplier guarantees the marketability of the goods, in particular of pharmaceuticals, in Germany.

5.3 In the case of individual deliveries of pharmaceuticals not approved or registered in Germany, which are not released from approval or registration, Supplier guarantees that the pharmaceuticals are approved for marketing in the exporting country, unless agreed otherwise.

5.4 Without prejudice to any further rights, Supplier shall indemnify us against all claims of third parties based on a breach of Supplier’s duties laid down in sections 5.1 to 5.3 except where Supplier is not responsible for the breach of duty.

5.5 Unless otherwise agreed or indicated in the order, all goods having a limited shelf-life, in particular but not limited to pharmaceuticals, at the time of receipt by us must have a customary remaining shelf-life but at least a remaining shelf-life of 12 months. If Supplier is unable to fulfil this obligation Supplier, without prejudice to his potential liability, will inform us without delay. Without prejudice to any further rights, we may return to Supplier any goods having an insufficient remaining shelf-life at Supplier’s risk and expense and demand immediate delivery of due and proper goods.

6. Prices, shipping costs, payment, right of retention, setoff, no assignment, reservation of title, processing

6.1 Unless agreed otherwise the agreed prices are deemed fixed prices DPU (Incoterms® 2020) inclusive of packaging and shipping and inclusive of statutory value-added tax, where applicable. Where any prices are agreed exclusive of packaging, packaging will be billed at cost price. Where it has been agreed that we shall bear the shipping costs and shipping is not effected through a transport service provider determined by us in accordance with section 4.2 and we have not defined any specific mode of transportation, Supplier shall choose the most economic mode of transportation.

6.2 Unless agreed otherwise all payments will be made by bank transfer within 30 days of delivery of the goods and receipt of a due and proper invoice in accordance with section 4.3. Invoices failing to comply with the specifications may be rejected by us. In any such case the date of receipt of the new, due and proper invoice will determine the beginning of the term for payment. In the event of early delivery, the term “delivery” as used above in this section 6.2 shall be replaced by the agreed delivery date.

6.3 We are entitled to rights of setoff and retention towards Supplier to the extent defined by the law.

6.4 Without prejudice to the provision of Sec. 354 a German Commercial Code (HGB) Supplier is not entitled to assign, have collected by third parties, or pledge his claims against us without our express consent. This shall not apply if and to the extent that Supplier has granted his supplier an extended reservation of title in the regular course of business. Supplier will immediately notify us in the event of an attachment of any claims.

6.5 The title to the delivered goods will pass to us at the latest upon payment. We will not accept any expanded or extended reservation of title.

6.6 Within the limits of the ordinary course of business, we will be entitled to process, sell or otherwise dispose of the delivered goods, even before the passing of title.

7. Defects, warranty

Our duties to notify defects and our warranty claims are governed by the statutory provisions as amended by the terms and conditions set out below:

7.1 Obvious defects in the delivered goods shall be reported to Supplier by us at the latest 14 days after delivery, and any concealed defects at the latest 14 days after their discovery.

7.2 Any payments towards the purchase price made prior to the establishment of any defects or the acceptance of the goods will not be deemed an acknowledgement that the goods are free from defects and will not release Supplier from his liability for defects.

7.3 Supplier will bear all expenses incurred in connection with the establishment and removal of defects, including expenses incurred by us.

7.4 Unless agreed otherwise and subject to sections 7.5 and 7.6 below, the warranty claims for deliveries and services of Supplier will become time-barred 36 months after delivery of the goods to us.

7.5 Subject to section 7.6, the limitation period in the case of replacement or subsequent delivery for purposes of supplementary performance, will be 36 months from the fulfilment of the duty of supplementary performance. This shall apply only if supplementary performance was made by express or implied acknowledgement of the duty to remedy defects and not, for example, as a gesture of goodwill or in the interest of the continued business relationship.

7.6 Nothing in this shall affect the statutory provisions on the limitation of recourse claims within the supply chain.

8. Liability, limitation of claims

8.1 Except as set out otherwise in these Terms and Conditions of Purchase, Supplier’s liability and the limitation of our claims are governed by the statutory provisions.

8.2 In any case of product or pharmaceutical liability Supplier will, without prejudice to any further rights, indemnify us against third party claims to the extent that the cause lies within Supplier’s sphere of control and organisation and Supplier is liable in the external relationship. The indemnification also extends to expenses we were reasonably justified to incur and did incur in order to identify, avoid and/or reduce the risk of liability.

9. Property rights, confidentiality

9.1 Supplier shall be liable for claims arising from any infringement of patents, copyrights, trademark rights, name rights and other intellectual property rights and applications for intellectual property rights (jointly the “Property Rights”) by the contractual use of the delivered goods. Supplier will indemnify us against all claims of third parties arising out of the use of such Property Rights, unless Supplier is not responsible for the breach. Supplier’s duty of indemnification also relates to all expenses reasonably incurred by us out of or in relation to any such third party claims, in particular but not limited to the costs of legal defence. If any claims are raised against us based on an infringement of Property Rights Supplier is responsible for, Supplier will be obliged to support us in the legal defence at Supplier’s expense.

9.2 Unless otherwise agreed and without prejudice to further statutory obligations, the contracting parties shall be obliged not to disclose to third parties all business and trade secrets of the other contracting party which are entrusted to them, made accessible or otherwise become known to them in connection with the business relationship; our affiliated companies within the meaning of sections 15 et seq. German Stock Corporation Act are not considered third parties in this sense. Employees will be subjected to the same undertaking. The contracting parties shall protect the business and trade secrets of the other contracting party from unauthorized access and treat it with the same care as they apply to their own equally confidential information, but at least with the care of a prudent businessperson. In particular, the contracting parties shall implement adequate, corresponding to the circumstances, technical and organisational measures to ensure the secrecy of the other contracting party’s business and trade secrets. This confidentiality obligation shall remain in force after termination of the contractual relationship, insofar as it still relates to business and trade secrets.
The confidentiality obligation shall not apply to business and trade secrets, which (i) are or become generally known without breach of law, (ii) are already known to the other contracting party at the time of conclusion of the contract or (iii) are disclosed to the other party by third parties without breach of a confidentiality obligation.

10. Security Declaration

10.1 If Supplier has neither applied for an AEO certification nor already holds the status of an Authorised Economic Operator, Supplier declares and warrants that (i) goods which are produced, stored or transported by our order or which are delivered to us or taken for delivery from us are produced, stored, prepared and loaded in secure business premises and secure loading and shipping areas and are protected against unauthorized interference during production, storage, preparation, loading and transport, (ii) reliable staff is employed for the production, storage, preparation, loading and transport of these goods, and (iii) subcontractors acting on behalf of Supplier are informed that they also need to ensure the supply chain security as mentioned above.

10.2 Upon our request, Supplier shall without delay either provide proof of the AEO F or AEO S certification or send us a security declaration signed as mentioned above signed by Supplier.

11. Place of performance, governing law, place of jurisdiction, arbitration

11.1 Our domicile shall be the place of performance for all payment and delivery obligations provided that Purchaser is a merchant.

11.2 All contracts shall be governed exclusively by German law with the exclusion of the UN Sales Convention (CISG).

11.3 The exclusive place of jurisdiction for any and all disputes arising out of or in connection with the contract entered into between Supplier and us shall be our domicile if Supplier is a merchant or legal person under public law or is not domiciled in Germany. However, we are also entitled to sue Supplier at any other legal place of jurisdiction or – instead of filing a lawsuit with an ordinary court of law – to initiate arbitration proceedings in accordance with sec. 11.4 below.

11.4 In the event of an arbitration proceeding all disputes will be decided with final effect under the Arbitration Rules of the German Institution of Arbitration (Deutsche Institution für Schiedsgerichtsbarkeit e.V. – DIS) while recourse to the ordinary courts of law is excluded. The forum of arbitration will be our domicile. The arbitration panel will be composed of three arbitrators if the value in dispute exceeds EUR 100,000, and of one arbitrator in all other cases. The language of arbitration proceedings will be German.

Status: June 2020