General Purchase Conditions

1. General provisions

1.1. These terms and conditions apply to all purchase contracts, offers or confirmations of orders for products or services (hereafter the product(s)) established between MPS SA (hereafter the buyer) and the supplier, except as otherwise stipulated by a written and signed agreement between the buyer and the supplier.

1.2. Before any commercial activity, within the framework of the free trade agreements on Swiss territory following the order from the Federal Council of 23 May 2012, the supplier will have declared the preferential or non-preferential origin of the goods delivered to the buyer by means of an invoice declaration or equivalent document according to Swiss customs regulations.

1.3. Abrogation of one of the clauses of these terms and conditions cannot affect the validity of the other clauses.

1.4. Acceptance of a delivery does not in any way constitute tacit acceptance of the supplier's General Conditions of Sale and Delivery.

2. Request and Price Offer

2.1. The supplier's bid is submitted and established free of charge.

2.2. The bid must be in accordance with the buyer's tender call. Any difference must be clearly indicated by the supplier.

2.3. Unless otherwise agreed, the bid is valid for 3 months.

2.4. As long as the buyer's order has not been confirmed by the supplier, the buyer can cancel it with immediate effect and without compensation.

2.5. Volume forecasts can be communicated by the buyer. Without an official framework contract or confirmed order, these forecasts are given only as an indication and without commitment on the part of the buyer.

3. Order

3.1. An order will only be considered valid by the buyer if it is in writing. It will indicate the description of the products, the technical and aesthetic specificities, the quantity, price, schedule and conditions of delivery and the payment terms. If the order does not mention any price or only an estimated price, the price will only become firm after written approval from the buyer, once the order confirmation from the supplier has been received.

3.2. The documents attached to the order (plans, specifications, operating ranges, other specifications and indications) form an integral part of the order.

3.3. In the event that the final plan of the product ordered is established by the supplier, it will submit this plan for the buyer’s approval, free-of-charge, before starting production. However, the supplier remains solely and fully responsible for the plan.

3.4. Within three working days following receipt of the order, the supplier will return a signed acknowledgment of receipt to the buyer by email or post.

3.5. The order confirmation must include at least the buyer's order number, item number, confirmed quantity, plan reference and version, price and expected time frame of delivery.

3.6. By signing, the supplier confirms the order and expressly acknowledges the application of these terms and conditions to the purchase contract.

3.7. Additional costs (additional inspections or tests, various administrative costs, tooling costs according to clause 4.1, etc.) must also appear in the order confirmation.

4. Specific tools, right of purchase

4.1. If, for execution of the order, the supplier needs tools, instruments, devices and means of control and measurement (specific tools), it will inform the buyer, at the latest when confirming of the order. It will describe each tool required by component reference and specify the price of it, as well as the overall price of the specific tool (or specification). The buyer will give the supplier its approval in writing.

4.2. The specific tools which the supplier needs to fulfil the order, and which have been given to it on loan by the buyer at the supplier's risk and expense, continue to be the property of the buyer.

4.2.1. They can only be used for the execution of the order and the supplier will ensure maintenance and repair of them at its expense, but not calibration.

4.2.2. The buyer's ownership of these specific tools will be clearly and indelibly marked and they will be stored so as to avoid any confusion with the supplier's tools.

4.2.3. The supplier will take all useful or necessary measures, notably with regard to insurance and for the appropriate amounts, and to storage security of specific tools in order to effectively protect the property of the buyer.

4.2.4. Once the order has been completed or at the buyer's request, the supplier will return all the specific tools to it.

4.2.5. At the request of the buyer, the supplier will return the instruments and means of controls and measurements loaned,

as well as, if necessary, the tools which could have to be modified.

4.3. The supplier agrees to only use the specific tools for execution of the orders for which they have been provided, and to never use them to manufacture products or components of third parties or to give them to such third parties. Tools may only be provided to an approved subcontractor with prior written agreement from the buyer. The buyer is always free to make sure that the supplier is in possession of the specific tools. The supplier agrees to use the specific tools with care. In the event of loss, damage or destruction of the specific tools by the supplier, its employees or one of its subcontractors, the supplier agrees to inform the buyer without delay and is responsible for replacement of specific tools, at its expense.

4.4. The supplier grants the buyer a right of purchase for the specific tools. The buyer exercises its right of purchase by written notification to the supplier, which occurs:

4.4.1. As soon as the buyer expresses the desire;

4.4.2. Upon definitive termination of any order for products requiring the specific tools;

4.4.3. At the end of the contractual relationship between the buyer and the supplier;

4.4.4. If the supplier is liquidated, makes an arrangement with creditors or proceeds with a general assignment to them, is declared bankrupt, becomes insolvent or ceases its activities in the domain of products or components.

At its choice, the buyer can exercise its right of purchase for only part of the specific tools or for all of them.

5. Subcontracting

5.1. The supplier may only subcontract important sub-assemblies, components or products with the prior written consent of the buyer.

5.2. The supplier is solely and fully answerable to the buyer for the items it has purchased from its own suppliers and subcontractors. It is, thus, responsible for the services of its subcontractors as well as for the proper quality of the materials they provide, as it is for its own.

6. Price, Transport and Risks

6.1. The prices are firm and valid until full and complete execution of the order. They include, unless otherwise specifically agreed, all related costs, such as packaging, transport to the specified place of delivery and insurance (Incoterm 2020 - DDP - Delivered Duty Paid).

6.2. The supplier is responsible for the suitability of the packaging for the product delivered, the mode of transport (including multi-modal) and storage used and the legislation in effect, from the place of dispatch to the place of delivery, as well for observation of any instructions from the buyer.

6.3. Unless otherwise agreed and, in this case, at the expense of the supplier, the packaging is not returnable.

6.4. Any other obligation relative to transport and risks is governed by the provisions stated in the Incoterms for 2020.

7. Deliveries

7.1. The place of performance for the delivery is the one mentioned in the order.

7.2. Delivery is made on the date and at the place agreed during the reception hours for goods.

7.3. Partial deliveries are not permitted without the buyer's prior written consent.

7.4. The agreed delivery times are considered fixed terms as intended under article 190 of the Swiss Code of Obligations. The supplier may only change the delivery times with the prior written consent of the buyer which, if applicable, reserves the right and at its option to:

7.4.1. To give the supplier additional time to perform; the buyer may postpone deliveries for a period of up to six (6) months without any additional cost to the buyer;

7.4.2. Renounce the delivery:

7.4.3. Apply late payment penalties to the supplier, without the need for prior notice, the calculation methods of which will be indicated in the order. In the absence of indication in the order, these penalties will be 1% per day of delay from the 3rd day of delay, capped at 15% of the total value of the contract.

7.5. The supplier agrees to inform the buyer in writing and without delay about the occurrence of major and unforeseen difficulties affecting its ability to respect the delivery time. The parties then agree in writing to find a mutually acceptable solution, taking

into account the circumstances. If this immediate duty of information is not respected by the supplier, clause 7.4. applies.

7.6. The delivered products must be accompanied by the following documents:

7.6.1. Delivery note including the buyer's order number, the item number, the quantity delivered, the reference of the plan and its version, the lot number, if applicable, and the identification of the certificates provided;

7.6.2. Material certificate type 3.1 according to EN 10204;

7.6.3. Certificate of hardness after heat treatment (according to plan or order);

7.6.4. Certificate of surface treatments applied (according to plan or order);

7.6.5. Control protocol (according to order);

7.6.6. Certificate of conformity (the addition of text according to § 8.1, with date and stamp on the BL can be accepted) (depending on order).

7.6.7. For special processes the reference number of the validated process and, in certain cases, the reference to the parameters, may be required (depending on the order).

7.7. If the documents listed in clause 7.6 are not delivered to the buyer upon delivery, the goods will not be received and will be stored at the supplier's expense and risk until receipt of the missing documents.

7.8. All correspondence (mail, delivery slip, invoice, etc.) must include the information necessary for the buyer to identify the order.

8. Receiving

8.1. The buyer agrees, within 30 working days following delivery, to perform an inspection of the products delivered in accordance with the procedures applicable for inspection by sampling. Tests or inspections upon receipt done by the buyer do not reduce or limit the supplier's responsibility for delivering products in accordance with the order.

At its expense, the supplier will have to take back products which do not meet the guarantees defined in clause 9.1. following notification of refusal by the buyer. It will be responsible for repairing or replacing the defective products within a period agreed between the 2 parties. If the supplier has neither the technical skills nor the availability to proceed with the repair or replacement of the products within the agreed time frame, a credit note in an amount at least equal to the price of the defective products must be issued and sent to the buyer before expiry of the payment time frame for the corresponding invoice.

8.2. If the supplier does not perform within the time frame stated in clause 8.1, the buyer is entitled, at its option, to either:

8.2.1. Give the supplier a new deadline by which to repair or replace the defective products;

8.2.2. Have the products repaired or replaced by a third party, at the supplier's expense;

8.2.3. Terminate the contract without financial compensation for the costs incurred by the supplier for manufacturing the defective products.

9. Guarantee of the supplier

9.1. The supplier guarantees, as a specialist and by means of a certificate of conformity and/or inspection report, that:

9.1.1. The products delivered correspond to the technical and aesthetic specifications stipulated by the buyer;

9.1.2. The products have been checked according to the requirements specified in the order, or else according to the usual requirements of the process concerned.

The warranty period on the products is the legal period applicable according to the rules of the sales contract appearing in the Swiss Code of Obligations, notably 2 years. This period begins to run upon acceptance by the buyer of the delivered products.

9.2. The supplier grants a guarantee according to clause 9.1. on replaced or repaired products or components.

9.3. If it appears, during the warranty period, that all or part of the product does not comply with the order, the supplier will be required to repair or replace all or part of the defective product, free of charge and within a period agreed between the two parties, with all related costs for transport, customs, etc., remaining as its expense. If repair is not possible or if the buyer cannot reasonably accept the repaired product, the supplier will replace it free of charge with a new product. In case of emergency or if the supplier does not react appropriately, the buyer can take any measure it deems useful and at the supplier's expense. The supplier's obligation of guarantee and quality remains reserved. If elimination of the defect is impossible or unreasonable, the buyer will have the option of requiring cancellation of the Order or reduction of the price.

9.4. The Supplier shall hold the buyer harmless for any contractual guarantee concerning the product, as well as third parties for any liability resulting from the product. In particular, it guarantees that use of it does not infringe the intellectual property rights of third parties, assumes responsibility for the costs of defence and indemnities in connection with these guarantees or liability, without limitation in time, and agrees to hold the buyer harmless for any related condemnation.

10. Traceability

10.1. The supplier agrees to ensure traceability of the products it delivers and to include the information in the manufacturing file. This traceability information must make it possible to make the connection between:

10.1.1. The raw material(s) used;

10.1.2. The process(es) applied (type “procedure”, “operating range” and/or “nomenclature”);

10.1.3. The product/component delivered to the buyer;

If a non-conformity is found, traceability must be possible so as to permit delimitation of the quantities of defective parts/products. If the supplier needs data from the buyer for the needs of traceability, it must ask the buyer for it and the latter cannot refuse it without justification.

All documents in the manufacturing file (including hardening certificate, material certificates) must be kept in an unalterable manner for 20 years after the date of delivery of the last component by the supplier.

If this is not possible, the supplier agrees to offer to take them back from the buyer before destroying them.

The buyer is also authorized, during the period indicated above, to become familiar with the manufacturing files at the supplier site at any time.

In the event of cessation of the activities of the supplier or the end of collaboration with the buyer, the supplier agrees to provide the documents of the manufacturing file to the buyer for archiving.

10.2. If a production run requires several lots of materials, with different material certificates, the production runs must not be mixed.

When performing subcontracting operations, each lot received from the buyer must be managed separately, keeping a copy of the “Order tracking sheet” with the parts, as identification.

11. Quality audit

11.1. Each supplier may be the subject of a periodic audit by the buyer, the purpose of which is to determine whether the supplier is able to perform in compliance with the technical specifications. The audit will also extend to the supplier's quality management system.

11.2. An audit of the supplier by the buyer can also be triggered by a series of malfunctions, in the interest of restoring confidence on the basis of corrective actions deemed effective.

11.3. The supplier will receive a report detailing the non-conformities observed during the audit. It will have to put corrective actions in place to remedy the non-conformities and submit an action plan to the buyer. Depending on the nature of the defects observed, the buyer may conduct a second audit to verify the effectiveness of the corrective actions.

12. Manufacturing processes

12.1. Manufacturing processes are essential with regard to mechanical properties, equipment and means of production. The supplier must specify the production methods, describing the parameters and means used, and demonstrate that it meets these specifications. When the recording of data is required, necessary or constitutes a common practice, the buyer can request that these records be attached to the delivery documents (e.g., heat treatment protocols).

12.2. Validation of special processes:

Definition: A special process is defined as any process whose output data cannot be verified without destructive testing.

12.2.1. The supplier agrees to perform or undergo a validation program for each special process. The validation report will determine means, parameters and conditions that must absolutely be respected to guarantee the requirements of the product.

12.2.2. All lots processed according to a validated process must be documented; these documents must be available at all times upon request from the buyer.

12.2.3. Any modification of a validated process (parameters, equipment, etc.) must be pointed out to the buyer and the modification cannot be applied to the buyer's orders without its approval.

12.3. Provision and supply of materials:

12.3.1. Materials supplied by the buyer are made available on loan and to fulfil a specific order;

12.3.2. Even after processing or transformation, they remain the exclusive property of the buyer, to which they must be returned, including their waste, after processing or transformation.

12.3.3. Raw materials and products must be stored such that no mixing can occur. Raw materials must be identifiable by their reference. Products must be identified by their part number and lot number so that traceability (lot no./serial no.) is guaranteed. In principle, only one lot must be present at the workstation at a given time.

12.4. Packaging:

12.4.1. The products must be packaged so as to avoid any damage during transport.

12.4.2. Products must be separated according to their part number and lot number.

13. Billing and payment

13.1. The invoice must be sent by email or by separate letter to the buyer's accounting department. It must mention, at minimum, the order number and the reference number, the VAT rate and amount, as well as the company name of the supplier and the exact address of the buyer.

13.2. Only products accepted by buyer's quality control system, according to clause 8.1, will be eligible for payment. COD shipments are not accepted.

13.3. Only the additional costs specified in the order confirmation, according to clause 3.7, will be due.

13.4. Unless otherwise agreed between the parties, payment will be due at 60 days net from the invoice date.

13.5. The place of performance for payment is the buyer's head office.

14. Intellectual Property

14.1. All documents (data, specifications, drawings, plans) and samples provided by the buyer, on any medium whatsoever, as well as all plans and technical drawings produced by the supplier for the products, parts or components ordered are and remain the exclusive property of the buyer, including the intellectual and industrial property rights inherent to these documents and samples. The supplier is not authorized to use these documents and samples for purposes other than those of fulfilling the order, to reproduce them or bring them to the attention of third parties. At the buyer's request or at the latest at the end of the contractual relationship between the supplier and the buyer, the supplier will immediately return all documents and samples to the buyer, destroy all working0 copies as well as all order-specific information contained in its data processing system.

14.2. If the buyer instructs the supplier to affix the buyer's marks on the products or specific tools, the supplier agrees to perform this service in accordance with the specifications received from the buyer. The supplier agrees to only use said marks at the express request of the buyer.

The supplier acknowledges that the buyer remains the owner of the marks affixed by it and that this placement does not grant it any license or other rights over these marks.

All materials and tools used for affixing the buyer's marks must be returned to the buyer or destroyed at its request and may under no circumstances be kept by the supplier or made available or sold to a third party.

14.3. The supplier is responsible for compliance by its subcontractors with the clauses of article 14.

15. Charter on sustainable development

15.1. The buyer considers Human Rights and sustainable development as fundamental values, the latter presuming actively responding to the environmental, social and economic needs of present and future generations, and anticipating changes.

15.2. The buyer has established a sustainable development charter intended for its suppliers and subcontractors (downloadable from the buyer's website). The buyer asks them to be part of this process of continuous improvement, by respecting the international, national or local conventions, laws and/or regulations applicable to their activities in the countries where they operate.

16. Safety and protection of the environment

16.1. The supplier will certify all Products sold to the buyer and which have not been manufactured in accordance with the buyer's plans as conforming to EC, REACH and ROHS standards and rules; if the regulations in effect in Switzerland are stricter or if they deal with points not covered by the aforementioned standards and regulations, the Products must also be certified as conforming to these standards and regulations. The Order may specify the application of different standards depending on the final destination of the Products.

16.2. At the buyer's request, the supplier will deliver the declarations of conformity with the corresponding Products.

16.3. If the Order provides for it, the supplier will deliver the documents and supporting items to the buyer in accordance with REACH regulation EC no. 1907/2006, and will make available the information on the Products which will allow the buyer to adopt behaviour that complies with the REACH regulations in its commercial exchanges. The Order may specify the application of different environmental standards depending on the final destination of the Products.

17. Confidentiality

17.1. The supplier agrees, at all times, to respect confidentiality with regard to all information related to orders and the resulting work or deliveries, as well as any other information of a commercial, technical or financial nature that the buyer provides to it during the contractual relationship. It imposes this obligation on its employees and subcontractors, is necessary by signing written commitments.

17.2. The buyer agrees to respect confidentiality concerning the documentation provided by the supplier and its subcontractors confidentially.

17.3. This data and other information, as well as any reproduction that may have been made by the supplier, must be immediately returned to the buyer at its request or if the contacts do not lead to a business relationship with the buyer.

18. Force majeure

In case of force majeure the parties will consult each other. In the absence of agreement, each party may unilaterally decide to cancel the Order and this cancellation will not give the other party any right to compensation.

19. Applicable law and jurisdiction

19.1. These terms and conditions, as well as all offers and orders placed by the buyer and confirmed by the supplier are governed by Swiss law, to the exclusion of the law on private international law.

19.2. In the event of a dispute arising from these terms and conditions, from bids or from orders placed by the buyer and confirmed by the supplier, the courts of Bern (Switzerland) have sole jurisdiction, subject to recourse to the Federal Court.

19.3. For provisional measures, the buyer reserves the right to take legal action before the courts of the supplier's domicile and to bring action in this forum.