of u2t Photonics AG for the delivery of goods and supply of service

I. Scope

1. These general terms and conditions shall apply to the present contract as well as by means of a frame work agreement for all future purchase contracts and contracts for work and materials between purchasers and u2t Photonics AG unless agreed otherwise in writing.

2. In default of a specific agreement to the contrary, general terms and conditions of the purchaser shall not become part of the contract. The terms and conditions of u2t Photonics AG shall also apply where u2t Photonics AG accepts delivery without reservation and where u2t Photonics AG is aware of the supplier's contrary terms or terms diverging from respectively amending these terms and conditions.

II. Formation of contract

1. Offers of u2t Photonics AG are without engagement and obligation.

2. U2t Photonics AG shall be entitled to accept the purchaser's offer of a contract within two weeks after the reception of the offer. Until the expiration of this period of time, offers shall be irrevocable. Silence shall neither constitute formation of contract nor trust in formation of contract. Should the purchaser receive u2t Photonics AG's acceptance with a delay, he shall inform u2t Photonics AG about the delay without undue delay.

3. Contracts, order acknowledgements, orders and any other contracts and declarations entered into or made by u2t Photonics AG shall only have binding legal effect once they have been confirmed in writing by an authorized representative of u2t Photonics AG.

4. Any appendices, drawings, illustrations, technical data and specifications contained in brochures, catalogues, mailings, advertisements, price lists, the internet or any documents are without obligation unless they are specifically indicated as binding in the offer.

III. Delivery and Delay

1. Delivery shall be effected "ex works" (INCOTERMS 2000). All delivery periods shall be "ex works" and start as from the formation of contract, however not before all information and documents necessary for the execution of the contract have been provided by the purchaser, all technical questions have been cleared and all authorizations are have been granted. Any periods or dates regarding deliveries and services which were announced by U2t Photonics AG shall always be deemed as approximate, unless a fixed period or date was explicitly promised or agreed upon.

2. U2t Photonics AG's adherence to delivery obligations is subject to due and proper fulfillment of the purchaser's obligations. The delivery date is under the provisio of proper self-supply of u2t Photonics AG.

3. In case u2t Photonics AG cannot comply with binding delivery periods due to reasons it is not responsible for (non-availability of service), it shall immediately notify the purchaser hereof and inform it about the estimated new delivery date at the same time. In case the service is also unavailable within the new delivery period, u2t Photonics AG shall be entitled to withdraw from the contract entirely or in parts; u2t Photonics AG shall reimburse any executed consideration to the purchaser without undue delay. A case of non-availability of services in these terms shall in particular be the delayed self-supply of u2t Photonics AG by its providers in case u2t Photonics AG has concluded a matching cover transaction. u2t Photonics AG's legal rights to withdraw from or terminate the contract as well as the statutory provisions regarding the winding up of the contract in case of exclusion of the duty of performance (for example impossibility or inability of service and/or cure) shall remain unaffected. The legal rights to withdraw from or terminate the contract pursuant to Cipher X. shall also remain unaffected.

4. The delivery date shall be deemed fulfilled if the delivery item has been made available on the premises of u2t Photonics AG before expiration of the delivery period and the purchaser has been notified about it.

5. U2t Photonics AG shall only be entitled to partial performances, in case a. the partial delivery is of use for the purchaser with respect to the contractually intended purpose b. the delivery of the remaining ordered goods has been secured and c. the purchaser does not suffer any significant additional expenditures or costs (unless the seller agrees to bear the expenses).

6 In case of delay with delivery or other performances the liability of U2t Photonics AG is subject to the applicable governing law according to the following conditions. The liability for damages caused by shall be limited to an amount of 0.5 % of the contractual value (net) for each full week of delay up to a maximum of 5 % of the contractual value (net). Payment of damages pursuant to this Clause 4.4 shall constitute the sole and exclusive compensation of the purchaser for delay to the exclusion of further claims for damages. This does not apply in cases of wilful damage or gross negligence.

7. The purchaser has any legal rights of rescission in case of delay with delivery or other performances only and insofar as U2t Photonics AG has culpably caused such delay. Any statutory rights of rescission remain unaffected.

8. Article III.6 and 7 shall not constitute an amendment of the statutory burden of proof.

9. A defective delivery shall not be considered as a delay with delivery.

10. At the request of U2t Photonics AG, the Purchaser is obliged to declare within a reasonable period of time whether he continues to insist on the delivery and/or whether he wants to assert any rights he may be entitled to due to a delay in delivery.

IV. Passing of Risk, Acceptance

1. The risk shall pass to the purchaser as soon as the delivery item leaves the works, the purchaser has been notified about the readiness for delivery pursuant to Cipher III, or the delivery item has been handed over to the person effecting the delivery. The first of these events shall be decisive.

2. Purchaser's default of acceptance or culpable violation of other obligations to co-operate entitles u2t Photonics AG to claim the damages caused in this respect including possible additional expenditures. Further claims shall remain unaffected hereof.

3. Under the conditions of the preceding para. 2, the risk of accidental loss or accidental deterioration of the delivered item shall pass onto the purchaser upon his default of acceptance or his debtor's delay.

V. Prices

1. All prices are “ex works” plus statutory value added tax. Packaging costs shall be charged additionally.

2. If the time between formation of contract and delivery exceeds two months and fixed price were not agreed upon, u2t Photonics AG shall be entitled to alter the price in order to balance cost increases for raw, manufacturing, and other materials as well as salaries and wages; the increase shall not exceed 5% of the net price, rebates which were granted and agreed upon, either fixed or on a percentage basis, shall be deducted in each case. The right to alternate prices shall only apply in case of circumstances, u2t Photonics AG is not liable for.

VI. Payment and Payment Terms / Withdrawal

1. All invoices shall be paid strictly net within 30 days after reception of the invoice. The receipt of payment by u2t Photonics AG shall be decisive.

2. After the expiration of the preceding respite the purchaser is in default. Delay in payment shall cause interest for default of 8% above base rate. Sec. 353 German Commercial Code and the assertion of additional damage caused by delay remains unaffected hereof.

3. Payment per check or bill of exchange requires a special agreement and is only accepted on account of performance. Possible expenses and costs shall be borne by the purchaser.

4. The whole claim becomes due in case of agreed installments and the purchaser's delay with one installment.

5. Should it, after the conclusion of the contract, become apparent that u2t Photonics AG's entitlement to consideration is jeopardized by the purchaser's inability to perform (a request for the opening of insolvency proceedings, for example), u2t Photonics AG shall be entitled to refuse to render its performance in accordance with the legal provisions regarding the right to refuse performance and - as the case may be after the granting of an additional period - it shall be entitled to withdraw from the contract (Sec. 321 German Civil Code). In case of a contract regarding the manufacturing of non-generic objects (individual productions), u2t Photonics AG shall be entitled to immediately withdraw from the contract; the legal provisions regarding the dispensability of specifying a period shall remain unaffected.

6. u2t Photonics AG shall be entitled to effect still outstanding deliveries or services only against advance payment or surety, if, after the contract has been entered into, it becomes aware of circumstances which are qualified to significantly lessen the creditworthiness of the purchaser and which will jeopardize the payment of bills receivable which are due in connection with the respective contractual relationship and which u2t Photonics AG may claim from the purchaser.

VII. Retention of Title

1. Until complete payment of all claims deriving from business relations between u2t Photonics AG and the purchaser, all goods delivered to the purchaser shall remain property of u2t Photonics AG (reserved goods).

2. Purchaser's conduct in breach of contract, especially delay in payment entitles u2t Photonics AG, after an appropriate specified period, to take back the delivered item. The retraction or seizure of the delivered item by u2t Photonics AG shall not be deemed as withdrawal from the contract. The purchaser shall bear the transportation costs occurring in connection with the retraction. After retraction of the delivered good, u2t Photonics AG is entitled to its realization. The proceeds of the realization shall be credited against purchaser's liabilities minus adequate realization costs. Further rights or claims remain unaffected.

3. In case of seizures or other encroachments by third parties, the purchaser has to refer to u2t Photonics AG's status of ownership and has to notify u2t Photonics AG without undue delay in writing, so that it is able to enforce its property rights. In case the third party is not able to reimburse u2t Photonics AG judicial and extra-judicial costs occurred in connection therewith, the purchaser shall be liable.

4. The purchaser is entitled to resell the reserved goods during the ordinary course of business until revoked. However, the purchaser is not entitled to pledge the reserved goods or to transmit property for security. Already now and by way of security the purchaser assigns to u2t Photonics AG to the full extent any and all claims for payment it may be entitled to claim from his customers due to resale of reserved goods, as well as any and all claims regarding reserved goods which might arise due to any other causes in law and which he may claim from his customers or third parties (in particular claims based on tortuous acts and claims regarding insurance benefits), namely including all outstanding balance claims due to current account, including any and all existing ancillary rights. U2t Photonics AG accepts such assignment. The purchaser shall remain entitled to collect these claims he assigned to u2t Photonics AG in his own name and on his own account for u2t Photonics AG, until the latter revokes such authorization. U2t Photonics AG's right to collect these claims itself shall remain unaffected thereby. However, u2t Photonics AG will not collect these claims itself and revoke the collection authorization as long as the purchaser duly fulfils his payment obligations. Should the purchaser act in breach of contract - in particular in case he is in delay with a payment - u2t Photonics AG shall be entitled to request the purchaser to inform it about the assigned payment claims and the respective debtors, to inform the respective debtors about the assignment, to hand over all documentation to u2t Photonics AG, and to provide all information u2t Photonics AG will need to assert the assigned claims.

5. Any processing or transformation of the reserved goods by the purchaser shall be deemed as effected for u2t Photonics AG. Should the reserved goods be processed with other goods which are the property of u2t Photonics, u2t Photonics shall acquire co-property of the new goods at the ratio of the value of the reserved goods (final invoiced amount, including value added tax) with respect to the other processed goods at the time of processing. Besides, the provisions regarding the reserved goods shall equally apply to the new goods created by processing. Should the reserved goods be inseparably combined or intermixed with other goods which are not property of u2t Photonics AG, u2t Photonics AG shall acquire co-property of the new goods at the ratio of the value of the reserved goods (final invoiced amount, including value added tax) with respect to the other combined or intermixed goods at the time of combination or intermixture. Should the reserved goods be combined or intermixed in a way that the purchaser's object is to be seen as the main object, the purchaser and u2t Photonics AG agree already now that the purchaser assigns to u2t Photonics AG, on a pro-rata base, the co-property regarding this object. U2t Photonics accepts such assignment. The purchaser shall safeguard the thereby created sole or co-property regarding this object for u2t Photonics AG.

6. The purchaser must handle the reserved goods with care. Purchaser shall insure the goods at replacement value against fire, water, fog, and theft at his own expense. Should maintenance or inspection work become necessary, the purchaser has to effect these on time and at his own expense.

7. Should the realizable value of the guarantees exceed u2t Photonics AG's claims by more than 20%, u2t Photonics AG shall, upon request of the purchaser, release guarantees of its own choice.

VIII. Warranty (“Mängelhaftung”)

1. The purchaser is obliged to thoroughly examine the delivered goods immediately after delivery provided this is feasible pursuant to the ordinary course of business and has to give u2t Photonics AG immediate written notice of defects that have or could have been detected pursuant to a proper examination. The purchaser has to give u2t Photonics AG written notice of hidden defects immediately after the detectability of the respective defect.

2. In case of a defect, the purchaser may request u2t Photonics AG to rectify the defects or to effect a subsequent delivery whereas u2tPhotonics AG shall be entitled to choose the applicable method of cure. In case the cure fails, the purchaser remains entitled to reduction of the purchase price or to withdrawal from the contract. Besides, Cipher X. shall apply in case of claims for damages or compensation of expenses. Any and all further claims or claims other than those set forth in Ciphers VIII. or X. of the purchaser against u2t Photonics due to a defect are excluded.

3. The return of goods shall be done in original packing and only after initiation of the u2t RMA process. U2t Photonics AG is not liable for any damage or weakening of returned goods due to improper packaging.

4. Costs for analysis or repair of returned goods with failures, which have not been caused by insufficient quality of goods or have been caused outside u2t Photonics AG's sphere, or which no longer fall into the warranty period, may be invoiced partially or in full amount.

IX. Prescription

1. Period of prescription of claims or rights based on defects (damages in lieu of or in addition to performance, claims for compensation of expenses, reduction of the purchase price, withdrawal or cure) is one year. Notwithstanding the foregoing, the statutory period of prescription shall apply a) with respect to all claims and rights of the purchaser in case of Sec. 438 subsec. 1 No. 1 German Civil Code (real right of a third party entitling to request the return of the purchased object), Sec. 438 subsec.1 No. 2 (structures and objects related to structures), Sec. 634a subsec. 1 No. 2 German Civil Code (structures, planning, supervision), Sec. 479 subsec. 1 German Civil Code (recourse claims) or fraudulent nondisclosure of a defect by u2t Photonics AG and, additionally, in case of claims for damages b) also in case of a culpable loss of life, bodily injury or damage to health, claims based on the Product Liability Act as well as breaches of duty committed intentionally or grossly negligent.

2. The provision set forth in Cipher IX. 1. regarding the prescription period shall apply in case of all claims and rights due to a defect, irrespective of the cause in law; therefore it applies in particular with respect to claims based on tortuous acts as well as restitution claims in case the purchaser declared the reduction of the purchase price or the withdrawal from the contract.

X. Liability and Limitation of Liability

1. The liability of u2t Photonics AG shall only be unlimited in case of intent or gross negligence and for a culpably caused loss of life, bodily injury or damage to health.

2. In cases of simple negligence, u2t Photonics AG shall only be liable - subject to Cipher X. 1. - if it infringes contractual duties which must be complied with in order to ensure proper performance of the contract and upon the performance of which the purchaser relied or could be reasonably expected to rely on (material contractual duties (“wesentliche Vertragspflichten”).In this case the liability shall be limited to the foreseeable, typical damage.

3. Cipher X. 1. and 2. shall also apply in favor of any legal representatives, employees, vicarious agents and any other person u2t Photonics AG charges with the execution of the contract.

4. The preceding limitation of liability shall also apply to claims for damages irrespective of the cause in law.

5. The liability pursuant to the German Product Liability Act shall remain unaffected by these provisions.

XI. Setting-off and Right of Retention

Any setting-off by the purchaser with contested claims or claims not recognized by final judgment shall be excluded. The same applies for rights to refuse performance pursuant to Sec.s 273, 320, 438 subsec. 4 sentence 2 German Civil Code and Sec. 369-372 German Commercial Code.

XII. Jurisdiction and Place of Performance

1. These general terms and conditions and all contractual relationships between u2t Photonics AG and the purchaser shall be governed by the laws of the Federal Republic of Germany. Any and all international and supranational (contractual) legal systems, in particular the UN sales convention, shall be excluded unless stated otherwise in these terms and conditions.

2. Except for mandatory exclusive jurisdiction, place of jurisdiction shall be the seat of u2t Photonics AG. However, u2t Photonics AG shall be entitled to sue the purchaser at his place of residence.

3. Place of performance shall be the seat of u2t Photonics AG. XIII. Severability clause Should any provision of the contract be or become invalid, this shall not affect the validity of the other provisions. The invalid provision shall be replaced by a legally valid provision which comes as close as possible to the economic meaning and purpose of the invalid provision. The same shall apply in case of gaps of the contract.

June 2010