Purchase Order Terms and Conditions

1. Acceptance. This Purchase Order (hereinafter “Contract”) constitutes Purchaser’s offer to Seller and becomes a binding contract on the terms and conditions set forth herein when accepted by Seller upon the occurrence of any of the following events: (a) by written acceptance by Seller’s authorized representative; or (b) by Seller’s failure to notify Purchaser of its objection to the terms and conditions hereof within ten (10) days after it is received; or (c) by partial or complete performance by either party. Dispatch of Seller’s sales acknowledgment or other confirmatory document is an acceptance of this Contract to the extent the sales acknowledgment or other document agrees with this Contract. This Contract is in no manner an expression of acceptance of Seller’s sales quotation acknowledgment or other document heretofore or hereafter sent or delivered to Purchaser. This Contract is not valid unless signed by an authorized representative of Purchaser.

2. Delivery Schedule. Purchaser’s production schedules are based upon the agreement that materials will be delivered to Purchaser by the delivery date(s) specified on the face of this Contract. Time is, therefore, the essence of this Contract. If delivery date(s) cannot be met, Seller must immediately inform the Purchaser in writing of Seller’s best possible delivery date(s) subject to Purchaser’s acceptance. If deliveries are not made at the time agreed upon by both parties, Purchaser may (a) request that Seller ship the goods by other than designated routing to expedite delivery, or (b) cancel the Contract in whole or in part and purchase comparable goods elsewhere, and hold Seller accountable for any loss or additional cost arising from such expedited delivery or cancellation and no charge will be allowed for packing, boxing or cartage, unless agreed upon at the time of purchase, but damage to any material not packed to insure proper protection to same will be charged to Seller. Each package must contain a memorandum showing Shipper’s name, contents of package and Purchase Order Number of Purchaser.

3. Warranties. Seller warrants that the goods to be supplied pursuant to this Contract are (a) fit and sufficient for the purpose intended; (b) merchantable, of good quality, and free from defects, whether patent or latent, in material and workmanship; (c) in conformity with the specifications, drawings, samples or other descriptions, if any, specified or furnished; and (d) consistent with any implied warranties mandated by the laws of the state of the address of Purchaser as shown on the face of this Contract. Seller further warrants and represents that Seller has absolute and good title to the goods supplied in that the goods are now free and at the time of delivery shall be free of all liens, security interests or encumbrances of any kind against the goods.

Seller also warrants that the fulfilling of this Contract, including all phases of the manufacturing process of the goods, does not constitute a violation of any federal, state or local law, or rule or regulation thereof, including, but not limited to trademark, copyright, Federal Food, Drug and Cosmetic Act as amended or patent laws in the manufacture or sale of the goods ordered herein. Seller agrees to defend and hold Purchaser harmless from any claims made against Purchaser arising out of any breaches of this warranty, arising from any violation of federal, state or local law, rule or regulation, or arising out of Seller’s fulfillment of this Contract; provided, however, that Seller’s indemnification obligations hereunder shall not apply to the extent that such claims are caused by Purchaser’s gross negligence or willful misconduct.

All warranties made in this Contract, together with service warranties and guarantees, shall run to Purchaser and the successors, assigns and customers of Purchaser, and shall survive any inspection, delivery, acceptance or payment by Purchaser of the material or services.

If this order calls for work to be performed upon property owned or controlled by Purchaser, it is understood that: Seller will keep the premises and work free and clear of all mechanic’s liens; the work will remain at Seller’s risk prior to written acceptance by Purchaser; and Seller will replace at Seller’s own expense all work damaged or destroyed by fire, force or violence of the elements or any other cause whatsoever.

For goods delivered in California or for use or consumption in California, Seller warrants that the goods are free of any substance which, when used in the normal course, would require a warning under the California Safe Drinking Water and Toxic Enforcement Act of 1986 (“Proposition 65”) as amended and any regulations promulgated in respect thereto.

4. Inspection and Rejection. Final inspection shall be on Purchaser’s premises unless otherwise agreed in writing. Purchaser reserves the right, at its option, to reject and to be held harmless for such rejection, any part or all of the goods ordered herein not conforming to the Contract. If goods are rejected as not conforming to this Contract, Purchaser has the right, at its option, to require Seller to (a) replace, at Seller’s expense, including the cost of transportation for reshipment, any and all non-conforming goods; or (b) refund the price of any or all non-conforming goods; or (c) a combination of (a) and (b). In addition, Purchaser has the right to impose a reasonable service charge for handling, storing and returning any non-conforming merchandise rejected under this Contract.

5. Title and Risk of Loss. Any F.O.B. or F.A.S. term used in this Contract shall be construed as a delivery term but legal and equitable title to merchandise ordered herein shall not pass to Purchaser until it is physically delivered at the Purchaser’s premises pursuant to the terms and conditions of this Contract and accepted by Purchaser in writing by Purchaser’s authorized representative as being in compliance with all terms and conditions of this Contract. Until such Purchaser’s acceptance of the goods, Seller shall continue to have title and bear the risk of any loss or damage to the items purchased hereunder.

6. Purchaser’s Trademarks. Seller understands that the trade name US Pet Nutrition and the trademarks, service marks, trade names, copyrights, designs and other intellectual property owned by Purchaser are valuable assets of Purchaser. As such, they must be used only on products made by Purchaser or under Purchaser’s control. In order to insure preservation of Purchaser’s valuable intellectual property rights, Seller agrees that Seller will not sell or otherwise distribute products comprehended by this Contract and containing trademarks, trade names, copyrights, designs or other intellectual property of Purchaser or any of Purchaser’s subsidiaries or affiliates to anyone or any entity other than Purchaser or one of Purchaser’s subsidiaries without Purchaser’s prior written approval.

7. Infringement. Seller, at its own expense, shall defend any suit brought against Purchaser on the ground that the equipment, product, or the ordinary intended method or process of the equipment or product, as furnished by Seller, infringes any United States Patent or Trademark or other intellectual right, and shall pay the amount of any judgment that may be awarded against Purchaser in any such suit. The provisions hereof are provided and upon condition that Purchaser shall (a) promptly deliver to Seller all infringement notices and other documents received by or served upon Purchaser; and (b) permit Seller to take complete charge of the defense of said suit and to compromise the same as deemed advisable; and (c) assist in every reasonable way in the conduct of such defense. In the event that Seller shall refuse in writing to defend against such suit brought against Purchaser, then Purchaser may undertake the defense of such suit and Seller shall agree to pay all court costs, reasonable attorney fees, judgments, and miscellaneous expenses incurred by Purchaser in defending against such suit.

8. Assignment. Seller shall not delegate any duties, nor assign or transfer any rights or claims under this Contract without the prior written consent of Purchaser, and any such delegation, assignment or transfer without such prior written consent shall be null and void. Purchaser may assign its rights and obligations under this Contract, including its proprietary rights, in whole or in part, to any of its subsidiaries or affiliates, now or hereafter existing, without the consent of Seller.

9. Changes. Purchaser shall have the right to make, from time to time and without notice to any sureties, or assignees, changes in this Contract in any one or more of the following: (a) drawings, designs, specifications, if any; (b) method of shipping or packing; (c) place of inspection, acceptance or point of delivery; (d) delivery schedule; and (e) increase or decrease quantities by an amount not exceeding 20 percent. Seller shall notify Purchaser’s Purchasing Department in writing by registered mail within seven (7) days of receipt of such change notice if Seller desires any adjustment in the price and/or time of performance of this Contract on account of said change notice, and such adjustment in price and/or time of performance shall be binding only upon the written authorization by Purchaser. Failure of Seller to give such notice shall constitute acceptance by Seller of the terms and conditions of the change notice and Seller’s agreement to fill the Contract as changed without adjustment in price or delivery dates and to be bound by all other obligations of this Contract.

10. Nondiscrimination.

EXECUTIVE ORDER 11246
(Section 202 Subparagraphs 1-7 [as modified by Executive Order 11375] issued Under Equal Employment Opportunities Act.)

During the performance of this Contract, the Seller agrees as follows:

(a) The nondiscrimination clause and reporting requirements contained in Executive Order 11246 of September 24, 1965, as amended by Executive Order 11375 relative to equal employment opportunity for all persons without regard to race, color, religion, sex, or national origin and the implementing rules and regulations prescribed by the Secretary of Labor, are incorporated herein.

(b) The Seller will furnish all information and reports required by Executive Order 11246 as amended, and by the rules, regulations, and orders of the Secretary of Labor, or pursuant thereto, and will permit access to Seller’s books, records, and accounts by the contracting agency and the Secretary of Labor for purposes of investigation to ascertain compliance with such rules, regulations, and orders.

(c) In the event of Seller’s noncompliance with the nondiscrimination clauses of this Order or with any of the said rules, regulations, or orders, this Order may be cancelled, terminated, or suspended in whole or in part and the Seller may be declared ineligible for further government contracts as provided by law.

11. Claims. Seller will indemnify, protect and hold harmless Purchaser, its stockholders, officers, directors, managers, agents and employees from any, claim, loss, damage, suit (“Claims”) reasonable attorney fees and expenses or liability including, without limitation, any claim of federal, state and local governments or any agencies or subdivisions thereof, arising out of or connected with the placing, acceptance, or fulfillment of this Contract and/or the goods herein specified; provided, however, that Seller’s indemnification obligations hereunder shall not apply to the extent that Claims are caused by Purchaser’s gross negligence or willful misconduct.

12. Force Majeure. For the purposes of this Contract, an event of “force majeure” shall mean any or all of the following events or occurrences: strikes, labor, disputes of any nature, temporary or permanent plant closing, shortage of materials, transportation services or labor, earthquakes, floods, storms, lightning, war, fire, sabotage, riot, lockout, acts of God, or of the public enemy, government regulations, or restrictions, or any other cause(s) beyond the reasonable control of Purchaser. If business is interrupted at any time due to the foregoing, Purchaser may, at its option and without liability, cancel any or all delayed or reduced deliveries or services and/or terminate this Contract.

13. Cancellation. Purchaser shall have the right to terminate this Contract and any or all other contracts between Purchaser and Seller for any of the following specified reasons:

1) Insolvency or bankruptcy of Seller as defined by the Uniform Commercial Code or bankruptcy laws

2) Failure of Seller to perform or comply with any provision of this Contract including a breach of any of the warranties set forth in Provision 3.

3) Nonconformity in or failure to delivery any lot or installment hereunder.

4) Change in delivery date(s) as set forth in Provision 2, Delivery Schedule.

Such rights of termination shall be in addition to Purchaser’s other legal rights and recourses whether set forth in this Contract or not.

14. Miscellaneous.

a) This Contract shall be deemed to have been placed and accepted in, and shall be construed in accordance with the laws of State of California without regard to its conflicts of law principles. The parties hereto agree that venue for any lawsuit brought, hereunder, whether in state court or federal district court, shall be in San Diego, California.

b) This Contract and the attachments and documents incorporated herein or referred to on the face of the Contract constitute the entire contract and understanding between the parties hereto and supersede all prior representations, understandings and Contracts relating to the subject matter hereof. If there is any conflict between this Contract and the terms of any sales acknowledgment or other confirmatory document prepared by Seller, the terms of this Contract shall govern. Notify Purchaser immediately of any error or omission in this Contract.

c) Purchaser’s failure to insist, in one or more instances, upon the performance of any term(s) in this Contract shall not be construed as a waiver or relinquishment of Purchaser’s right to such performance or the future performance of such term(s), and Seller’s obligation with respect thereto shall continue in full force and effect.

d) The invalidity, in whole or in part, of any provision of this Contract shall not affect the validity of enforceability of any other of its provisions.

e) The paragraph headings in this Contract are used for convenience only. Such headings form no part of this Contract and are in no way intended to alter or affect its meaning.