English to German Law/Patents Law: Contract(s)

10. Epidemic/endemic warranty

The definition of a failure due to requirements for system function of Contract Goods is a system warranty failure which is caused by incorrect design, incorrect choice of materials, incorrect manufacture and workmanship or incorrect procedure used in the assembly phase or otherwise caused by THE SUPPLIER and is likely to occur in all vehicles, herein after referred to as "systematic failure".

When a failure occurs, ABC and THE SUPPLIER make, in the interest of ABC, an evaluation of the reason for the failure and when mutual agreement of systematic
failure exists, THE SUPPLIER is obliged to remedy all Goods delivered or to be delivered.

If there is no agreement whether a failure is of systematic or occasional nature, A systematic failure exists if failure is present on at least 10 % of delivered Contract
Goods. A systematic failure also exists if a failure caused by the same reason arises in the total of 3.0 % of the same parts and components (on option orders).

THE SUPPLIER shall correct all systematic faults on delivered goods which become apparent on more than 3.0 % of the delivered quantity and within 10
years from the date of approved delivery of the last vehicle to the customer of ABC, but not later than 12 years after the last delivery of Contract Goods, in all previous vehicles at his own expense.