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Terms and Conditions of Purchase

  1. Definitions. “Deliveries” shall mean deliveries of goods and equipment. “Equipment” shall mean machines, tooling, installation and other production equipment. “Goods” shall mean all production materials, parts and components (including any instalment of the goods, semi-finished goods or any part or portion of them) as well as any rights as described in the Purchase Order. “Purchaser” shall mean the entity placing the Purchase Order. “Purchase Order” shall include an individual purchase order, a blanket purchase order, a release, a tooling purchase order or other similar document or written authorization approved by Purchaser and issued to Supplier. “Specifications” shall mean the description /specifications of the Goods (and related Services, if any) as set out in or attached to the Purchase Order. “Supplier” shall mean the entity accepting the Purchase Order.

  2. Supplier’s Acceptance. The Purchase Order constitutes Purchaser’s offer to Supplier concerning the Goods. Acceptance of this offer by the Supplier is expressly limited to the terms and conditions set forth on the face of the Purchase Order and herein. In the event that any invoice, proposal, quotation, acknowledgment or other document from Supplier contains terms and conditions that are additional to or different from those set forth herein, this offer shall be deemed a notice of objection to and a rejection of such additional or different terms and conditions. Purchaser accepts Supplier’s Goods only on the condition that Supplier expressly assents to the terms and conditions contained on the face of the Purchase Order and herein. The earlier of commencement of any work or services under the Purchase Order or delivery of any Goods shall constitute a full acceptance by Supplier of the Purchase Order and these terms and conditions. The terms and conditions shall govern the entire relationship and all future transactions between Purchaser and Supplier concerning the Goods unless otherwise expressed in writing.

  3. Price Warranty and Payment. Purchaser shall not be invoiced at a price higher than that stated on the face of this Purchase Order (“Price”). If the Purchase Order is not priced, Supplier shall not charge a higher price than that last quoted or charged to Purchaser. The Price is firm and may not be increased for any reason, including without limitation, any raw materials issues or force majeure events. Supplier hereby warrants that the prices indicated on the face of this Purchase Order are no higher than those being charged to any other purchaser of comparable quantity and quality of Goods. In addition, any discount made available to any purchaser before the last day of the month during which the Goods are shipped to Purchaser shall retroactively apply to this Purchase Order and Supplier shall promptly credit Purchaser with the amount of such discount. Supplier shall issue invoices for Goods on the shipment date. Purchaser shall pay all undisputed amounts contained in Supplier’s invoices within sixty (60) days; provided that if required by Purchaser or Purchaser’s customer, Supplier must provide to Purchaser properly executed waivers of mechanics or any other liens (for itself and from each of Supplier’s approved subcontractors) as a precondition to payment hereunder.

  4. Quantity. Unless otherwise specified on the face of the Purchase Order, such order shall be shipped complete. Purchaser shall not be obligated to accept any shipment of Goods in excess of the quantity specified in the Purchase Order. Any excess quantity will be held at Supplier’s risk and expense for a reasonable time awaiting return shipping instructions from Supplier. Risk of loss and return shipping damages for any excess shall be borne by Supplier.

  5. Warranty. In addition to and without prejudice to any other warranties, both express and implied, Supplier hereby represents and warrants that the Goods (a) shall be free from any defects in material or workmanship, (b) shall conform to the specifications, drawings and other descriptions set forth in the Purchase Order or otherwise provided by Purchaser, (c) shall be merchantable within the meaning of the Uniform Commercial Code in the State of Illinois, (d) shall be fit for any particular purpose or other requirement communicated by Purchaser to Supplier, and (e) do not and will not infringe upon or violate any intellectual property or proprietary rights of any third party. Supplier further warrants that it has title to the Goods free from any liens, claims or encumbrances whatsoever. If any services are to be performed by Supplier, Supplier further represents and warrants that such services will be performed in a professional and workmanlike manner in accordance with the highest industry standards. All express or implied warranties shall extend to Purchaser, its successors, and customers, and to all users of the Goods for the maximum extent permitted by law. In addition to any other remedies available if any warranty is breached, Purchaser or such other parties may at their option, either cancel this Purchase Order or return any or all of the Goods for cash refund or credit, at their option.

  6. Delivery. Time and quantity are of the essence. Except as Purchaser may otherwise direct, the Goods shall be delivered complete to Purchaser in the stated quantity and by the required delivery date. Supplier shall be responsible for any and all delays, except as expressly stated herein. In the event delivery will be late, Supplier must notify Purchaser immediately that the agreed delivery date cannot be met even if it is due to force majeure. Supplier shall take all reasonable steps to keep the delay as short as possible. If Supplier’s deliveries will not meet agreed schedules, Purchaser may require Supplier to ship via a more rapid route or carrier to expedite such delivery and any difference in cost caused by such change shall be paid by Supplier provided, nevertheless, that such right shall be in addition to any other rights or remedies of Purchase. Unless otherwise stated on the face of this Purchase Order, all deliveries are F.O.B. Purchaser’s facility listed on the face of this Purchase Order, and Supplier shall bear all risk of loss for the Goods until they are physically delivered to Purchaser’s facility. The prices stated on the face of this Purchase Order include all insurance, packing, freight, taxes and other charges to the point of destination unless otherwise specifically noted otherwise in the Purchase Order. If Supplier delivers the Goods prior to the delivery date designated on the face of this Purchase Order, Purchaser shall be entitled to refuse delivery and, at Supplier’s expense, provide for the delivery of the Goods to a warehouse, and for their storage and re-delivery to Purchaser on the proper delivery date. By providing for such transportation and storage, Purchaser shall not be deemed to have waived any rights to reject other than those based on the early delivery.

  7. Packing. The Goods shall be packed and shipped by Supplier in accordance with Purchaser’s instructions and good commercial practice to ensure that no damage results from transportation, weather or other foreseeable conditions. In the absence of a packing list, Purchaser’s count as to the quantity of Goods shipped shall be final and conclusive.

  8. Inspection of Goods. All Goods, raw materials, work in progress, and components to be incorporated into the Goods, as well as Supplier’s plant and premises, may be inspected and tested by Purchaser at all reasonable times, including during the period of manufacturing. Supplier’s authorized agent, representative, customers or regulatory authorities reserve the right to conduct quality systems and performance audits to ensure the requirements of Purchaser and applicable regulations are being complied with. Supplier and any subcontractor shall, at their own expense, provide safe and convenient means of inspection to Purchaser’s inspectors. Purchaser shall be entitled to charge Supplier for any additional inspection costs resulting from such items not being ready or available for inspection or testing or if such inspection or testing is conducted after Purchaser’s rejection of any Goods, Supplier shall provide and maintain an inspection system acceptable to Purchaser with respect to any Goods and shall keep complete records of the inception work performed by Supplier until three (3) years after the expiration of the warranty period specified herein. Notwithstanding any other inspection, the Goods are subject to final inspection and acceptance by Purchaser at its facility, or at such other location specified in writing by Purchaser, and no prior inspection or payment shall be deemed an acceptance or a waiver of any rights of Purchaser or shall in any way relieve Supplier form its obligations or liabilities hereunder. Without limiting any of Purchaser’s other remedies, Purchaser shall be entitled to reject any defective or nonconforming Goods, in whole or in part, return them to Supplier for cash refund or credit, at Purchaser’s option. Any rejected Goods may also be held by Purchaser at Supplier’s risk if Supplier does not remove the Goods within ten (10) days after notice of rejection and Purchaser may sell or otherwise dispose of any rejected Goods for Supplier’s account. Purchaser shall further be entitled to full reimbursement for any transportation charges, packing, or any other charges incurred in connection with the receipt, reshipment or disposition of any defective or nonconforming Goods.

  9. Changes. At any time prior to delivery, Purchaser may increase or decrease the ordered quantity of Goods or make any other change within the general scope of the Purchase Order, whether in whole or in part, by providing written notice to Supplier, and the provisions of this Purchase Order shall apply to all such changes, additions, and modifications. No work, addition or alteration will be paid for unless performed pursuant to and in accordance with the written order of Purchaser. If any such change is not the result of Supplier’s breach of the Purchase Order and these terms and conditions and causes an increase or decrease in the cost or time required to perform the Purchase Order, an equitable adjustment shall be made and the Purchase Order shall be modified in writing accordingly. Supplier shall be deemed to have waived any claim for adjustment unless asserted in writing within ten (10) days from the date of Purchaser’s written notice of change. In the event any customer of Purchaser reduces contract volume or shifts scheduled dates, for reasons such as, but not limited to, acts of God, strikes, labor shortage or disturbance, fire, accident, war or civil disturbance, delays of carriers, cyber-attacks, epidemic, pandemic, disease outbreak, quarantine or shelter in place restrictions, terrorist attacks, failure of normal sources of supply, or acts of inaction of government, Purchaser is entitled to pass these changes on the Supplier accordingly and reduce or shift the scheduled deliveries. In this case Supplier is not entitled to any claims for additional compensation. However, nothing herein shall excuse Supplier from immediately proceeding with the change.

  10. Termination. Purchaser may terminate this total Purchase Order or any unfilled portions thereof at any time as provided herein. In addition to and without limiting any of Purchaser’s other remedies, Purchaser may cancel this Purchase Order in whole or in part, without any liability to Supplier hereunder, if the Goods, or any part thereof, are not delivered or performed at the times, at the places, in the manner, at the prices and in the quantities set forth on this Purchase Order, or if any of these Terms and Conditions are breached, if any action is taken that commences any proceeding of voluntary or involuntary state or federal bankruptcy or insolvency against Supplier or if a receiver or similar official is appointed for any substantial part of Supplier’s assets. If Purchaser cancels or suspends this Purchase Order in whole or in part at any time for any other reason, Supplier shall, to the extent specified in Purchaser’s notice, promptly suspend work, terminate any work being performed by others under any outstanding subcontract with respect to the Goods, take all other reasonable steps to minimize its expenses with respect to the Goods, and take all necessary action to protect all property in Supplier’s possession in which Purchaser has or may acquire an interest. Any mutually agreed upon cancellation or restocking fees must be submitted to Purchaser no later than sixty (60) days after Supplier has been notified to cancel or suspend this Purchase Order. Any cancellation or suspension by Purchaser shall be without prejudice to any of Purchaser’s claims for damages or its other rights against Supplier. Purchaser, at its option, may accept late, defective or nonconforming Goods, and Supplier will agree to an equitable adjustment in the price of those Goods. If Purchaser elects to cancel this Purchase Order, Purchaser shall have the option to take any Goods, work or other items included in this Purchase Order whether finished, unfinished, or in process, upon such terms as Purchaser and Supplier may negotiate. If Purchaser has instructed Supplier to suspend work, by no later than ninety (90) days after giving such instruction, Purchaser shall either cancel this Purchase Order or instruct Supplier to continue the work. If Purchaser elects to continue, Supplier shall, within thirty (30) days after such election to continue, submit to Purchaser any claim it may have for adjustment of price, delivery schedule or any other item affected by the work stoppage.

  11. Setoff. Purchaser shall be entitled at all times to deduct from the amount due Supplier under the Purchase Order, either damages for any breach of the Purchase Order or amounts otherwise due Purchaser from Supplier, irrespective of whether or not deduction is related to the Goods or services covered by the Purchase Order.

  12. Remedies. Each of the rights and remedies reserved by Purchaser in the Purchase Order shall be cumulative and additional to any other or further remedies in law or equity.

  13. Assignment/Subcontractors. Supplier shall not assign the Purchase Order, any interest herein or any rights hereunder, or subcontract any obligation to be performed hereunder without the prior written consent of Purchaser.

  14. Indemnification and Insurance. Supplier shall indemnify and hold harmless Purchaser and its affiliates and customers against any “indemnity loss” arising out of, connected with or resulting from the Goods including, without limitation, the selection, delivery, possession, use, operation or return of the Goods; or infringement or alleged infringement of any patent, copyright or trademark, or wrongful use of third-party trade secrets or proprietary information in connection with the Goods; or any injury or damage sustained to any person or property arising out of or occurring in connection with the negligent acts or omissions or willful misconduct by Supplier or its personnel or contractors. “Indemnity loss” includes but is not limited to, all claims, actions, suits, proceedings, costs, expenses, damages, liabilities, penalties, fines, actual attorney fees, consequential and incidental damages, and loss, damage, liability or claims arising from alleged or actual injury or death to persons or damage to property. Supplier shall procure and maintain insurance with an insurer having an A.M. Best Rating of A-VIII or higher with at least the following minimum coverages and limits: (a) workers compensation insurance as required by applicable law; (b) employer’s liability coverage of at least $1,000,0000 per each accident and $1,000,000 per each employee-disease with a $1,000,000 policy limit-disease; (c) commercial general liability on an occurrence basis, including contractual liability, with limits of at least $2,000,000 in the aggregate (per project), $2,000,000 products & completed operations aggregate, $1,000,000 personal and advertising injury and $1,000,000 per occurrence; (d) business auto liability, including owned, hired and non-owned autos, with a $1,000,000 combined single limit; (e) umbrella/excess liability (i) for non-food packaging vendors, $5,000,000 per occurrence and $5,000,000 in the aggregate, (ii) for food packaging vendors, $5,000,000 per occurrence and $5,000,000 in the aggregate, and (iii) for equipment and service vendors, $2,000,000 per occurrence and $2,000,000 in the aggregate; and (f) professional liability coverage, if design or engineering services are provided, of at least $1,000,000 per claim and $1,000,000 total limit, with a $100,000 maximum deductible. Supplier shall be responsible to ascertain and warrant that all insurance coverages are complete in form and meet all minimum limit requirements as specified above. Supplier shall add Shorr Packaging Corp., its subsidiaries and affiliates, and each of their respective directors, officers, employees, agents and consultants, on a Primary/Non-Contributory basis as Additional Insureds on the Commercial General Liability via CG2010 10/01 (and CG2037 10/01 if needed for Completed Operations exposure) and Business Auto Liability policies (copies of Endorsements must be attached to the Certificate of Insurance). Supplier agrees to submit Certificates of Insurance evidencing the insurance coverage when requested by Purchaser. Such Certificates shall include a clause that at least thirty (30) days advance notice of cancellation or other material change be given to Purchaser. The obligations stated under this paragraph 15 shall survive the termination, non-renewal or expiration of the Purchase Order.

  15. Compliance with Laws. Supplier shall comply with all federal, state and local laws, and executive regulations and orders, including, without limitation, the applicable requirements of the Fair Labor Standards Act, as amended, and of regulations and orders of the U.S. Department of Labor issued under applicable requirements of Executive Order 1141 and 11246, as well as the Rehabilitation Act of 1973, as amended, Occupational Health and Safety Act (OSHA), Hazardous Materials Transportation Act and Toxic Substances Control Act (TSCA) and regulations issued thereunder. Further, Supplier warrants that all chemical substances furnished that are required or permitted to be reported to the U.S. and/or Canadian Environmental Protection Agency (EPA), as applicable are listed as chemical substances in the EPA’s current inventory listing. Supplier hereby guarantees that any food, drug or cosmetic that may be covered hereby, or comprising or being a part of any shipment or other delivery hereunder, will not at the time of such shipment or delivery be adulterated or misbranded within the meaning of the Federal Food, Drug and Cosmetic Act, as amended or within the meaning of any State Food and Drug Law, the adulteration or misbranding provisions of which are identical with or substantially the same as, those of the Federal Food, Drug and Cosmetic Act, or be an article that may not under the provisions of said Act or Law be introduced into interstate or intrastate commerce. The Goods are hereby warranted to conform to applicable FDA regulations pertaining to such Goods and their intended use. Supplier agrees to defend, indemnify and hold Purchaser harmless from any expenses, loss, damage or liability resulting from the failure of Supplier to comply with the laws and regulations described in this Section 16.

  16. No Implied Waiver. The failure of either party at any time to require performance by the other party of any provision of these Terms and Conditions will in no way affect the right to require such performance an any time thereafter, nor will the waiver by either party of a breach of any provision of these Terms and Conditions constitute a waiver of any succeeding breach of the same or any other provision.

  17. Entire Agreement. These Terms and Conditions and the terms set forth on the Purchase Order constitute the entire understanding between Purchaser and Supplier except for any other oral or written representations or warranties made by Supplier with respect to the Goods.

  18. Confidentiality. Purchaser may furnish or make available to Supplier certain confidentiality, proprietary and/or non-public information and materials relating to the Goods or Purchaser or its affiliates and their businesses (“Confidential Information”). Supplier shall not disclose such Confidential Information except to its employees who may require use of the Confidential Information in the performance of their duties, and Supplier shall not use such Confidential Information for any other purpose. Supplier’s obligations with respect to such Confidential Information shall continue indefinitely after receipt thereof. For the avoidance of doubt, the confidentiality obligations hereunder are in addition to and not in lieu of any obligations which the parties may have under any separate non-disclosure or confidentiality agreement. Upon Purchaser’s request, Supplier shall promptly return all Confidential Information received from Purchaser. In addition to all other remedies available to it, Purchaser shall be entitled to seek injunctive or other equitable relief for any violation of this Section. This Section shall not apply to information that is: (a) in or becomes part of the public domain without any breach of this agreement; or (b) rightfully obtained by the Supplier on a non-confidential basis from a third party who is not under any obligation of confidentiality.

  19. Independent Contractor. Supplier shall have no authority to hire any persons on Purchaser’s behalf and each person employed or used by Supplier shall be Supplier’s and not Purchaser’s employee, servant or agent, and further, Supplier acknowledges and agrees that Supplier is performing all of said work as an independent contractor. Nothing contained in these Terms and Conditions shall be construed as creating any agency, partnership, franchise, business opportunity, joint venture or other form of joint enterprise, employment or fiduciary relationship between the parties, and neither party shall have authority to contract for or bind the other party in any manner whatsoever. No relationship of exclusivity shall be construed from these Terms and Conditions.

  20. Severability. If any provision of these Terms and Conditions is held invalid, illegal or unenforceable, the remaining provisions will not in any way be affected or impaired. A court may modify the invalid, illegal or unenforceable provision to reflect, as closely as possible, the parties’ original intent.

  21. Governing Law and Venue. These Terms and Conditions shall be governed by, construed and enforced in accordance with the laws of the State of Illinois without regard to choice of law rules. The Convention on Contracts for the International Sale of Goods shall not apply. Any notice required to be sent under these Terms and Conditions will be sufficiently given if sent by U.S. Mail addressed to the party at the place of busines referred to on the front side of the Purchase Order. Any lawsuit, action or proceeding arising out of or relating to these Terms and Conditions or a Purchase Order shall be brought in a federal or state court in the jurisdiction where Purchaser maintains its corporate headquarters, and each of Supplier and Purchaser hereto irrevocably submits to the exclusive jurisdiction and venue of any such court in any such suit, action or proceeding.

  22. Survival. Upon termination of the Purchase Order for any reason, any section that by its nature should survive the Purchase Order will survive and continue in effect and be binding on the parties, including, without limitation, paragraphs 3, 5, 14, and 15.

Revised 9-1-2022