Bergstrom Purchase Order Terms & Conditions

Bergstrom Inc.

PURCHASE TERMS AND CONDITIONS

These Terms and Conditions of Purchase (“Terms and Conditions”) apply to and are incorporated in any ordering document, purchase order, electronically transmitted (“EDI”) order, or other similar order documentation (individually and collectively a “Purchase Order”) issued by Bergstrom, Inc. or any Bergstrom affiliate (“Bergstrom”) and, together with an accepted Purchase Order, and any documents referenced in the Purchase Order or incorporated therein, including any Supply Agreement executed by the Parties that incorporates these Terms and Conditions, and any Nondisclosure, Warranty and/or Bailment Agreements executed by the Parties, shall constitute the “Agreement” with respect to Bergstrom’s purchase from Seller of the goods and/or services (“Supplies”) identified in the Purchase Order. Bergstrom may change these Terms and Conditions at any time in its sole discretion, and such changes will be effective upon posting of such updates on the Bergstrom website. Seller is responsible for periodically visiting the site to review any changes to the Terms. Seller warrants it has fully reviewed, understands, and can fulfill its obligations under the Terms. By furnishing Supplies to Bergstrom, Seller acknowledges and agrees to be bound by these Terms and Conditions and any future changes to them and that Seller is responsible to ensure that all of Seller’s contractors, subcontractors, vendors of any tier furnishing the Supplies (individually and collectively, “Seller Affiliate”) to Bergstrom comply with these Terms and Conditions.

1. OFFER; ACCEPTANCE; TERMS; ENTIRE AGREEMENT.

a. Each Purchase Order is an offer to Seller for the purchase of (“Supplies”) and includes, and is expressly limited to, these Terms and Conditions (as may be revised from time to time) that are posted on Bergstrom’s website as of the date of the Purchase Order. The Purchase Order supersedes all prior agreements, orders, quotations, proposals, terms, and other communications regarding the Supplies described in the Purchase Order (other than the existence of a Supply Agreement between the parties pursuant to which the Purchase order was issued) and shall be interpreted as a rejection of any prior offers or terms by Seller for its sale of the Supplies to Bergstrom. Any reference to Seller’s quotation, bid, or proposal on the Purchase Order does not imply acceptance by Bergstrom of any term, condition, or instruction contained in that document. Bergstrom specifically rejects any additional or inconsistent terms and conditions offered by Seller at any time. As such, Seller’s general terms and conditions of sale do not apply to the Agreement or Bergstrom’s purchase of the Supplies unless Bergstrom acknowledges and agrees in writing that such terms and conditions apply and specifies which specific terms and conditions are intended to supplement, amend, or replace any provision contained herein.

b. These Terms and Conditions, along with the Purchase Order and any other specifications or requirements transmitted to Seller by Bergstrom in connection therewith shall be the sole and entire agreement between the parties with respect to the Purchase Order and the complete and exclusive statement of the Agreement between the Parties with respect to Bergstrom’s purchase of the Supplies from Seller, unless such Purchase Orders are issued pursuant to a Supply Agreement mutually executed by the Parties, in which case the Supply Agreement shall also be considered as part of the entire Agreement.

c. The accepted Purchase Order may only be modified by a written amendment executed by authorized representatives of each party. No course of prior dealing or usage of the trade may modify, supplement, or explain these Terms or any terms set forth in the accepted Purchase Order.

d. By furnishing Supplies to Bergstrom, Seller acknowledges and agrees to be bound by these Terms and any future changes in them. Seller’s assent to these Terms and Conditions shall be conclusively presumed from the shipment or delivery of any Supplies ordered by Bergstrom.

e. Seller accepts these Terms and Conditions and forms a contract (i.e. the “Agreement”) for Bergstrom’s purchase of the Supplies by:

          i. commencing any performance under or in accordance with the Purchase Order;
          ii. confirming or accepting the Purchase Order in writing;
          iii. failing to provide written rejection of the Purchase Order within 48 hours of receipt; or
          iv. any other conduct that recognizes the existence of a contract or the intent to be bound with respect to the subject matter of the Purchase Order.

f. Acceptance of any Purchase Order is strictly limited to and expressly conditioned upon Seller’s unqualified acceptance of and agreement to these Terms and Conditions and any other of Bergstrom’s requirements specifically set forth on the Purchase Order.

2. GENERAL CONDITIONS:

a. Unless quantities and shipping schedules are specified in the Purchase Order, Bergstrom makes no representations or guarantees as to the quantity of Supplies it will purchase from Seller.

b. Terms of Sale will be FCA (Incoterms 2020) Origin, at which time title will also transfer.

c. All goods will be subject to Bergstrom’s inspection and rejection at Bergstrom factory.

d. Bergstrom reserves the right to cancel any portion of the Purchase Order if not filled as specified.

e. Seller must render invoices on the day of shipment, and all invoices, packing slips, and packages must show Bergstrom’s Purchase Order number, the Bergstrom Part Number, and County of Origin and all other requirements set forth in the Bergstrom Supplier Manual. All packages must include a packing slip.

f. Seller will provide all special handling instructions that are needed to advise carriers, Bergstrom, and their employees how to take appropriate measures while handling, transporting, processing, using or disposing of the Supplies, containers, and packing. Seller will also provide Bergstrom sufficient warning in writing (including all required labels on all Supplies, containers, and packing, including without limitation disposal and recycling instructions, material safety data sheets and certificates of analysis) of any hazardous or restricted material that is an ingredient or part of the Supplies.

3. ORDER OF PRIORITY. The documents which constitute the Agreement are intended to and should be construed as a whole. In the event of an irreconcilable conflict between the documents which constitute the Agreement, the documents shall govern in the following order unless otherwise specified in a writing signed by Bergstrom as set forth below: the Supply Agreement (if one exists) including any schedules and appendices thereto, the Bergstrom Warranty Agreement for suppliers (if one exists), any written specifications or requirements for the Supplies referenced or incorporated in the Purchase Order or Supply Agreement (if one exists), the Nondisclosure Agreement (if one exists), the Bailment Agreement (if one exists), the Purchase Order, these Terms and Conditions, and the Supplier Manual. No agreement to modify or supplement these Terms and Conditions or the order of priority stated herein shall be binding upon Bergstrom unless in writing and signed by Bergstrom’s authorized agent, which writing must specifically acknowledge that these Terms and Conditions are superseded by such agreement or understanding.

4. SHIPPING RELEASE. Unless specific delivery dates are provided in the Purchase Order, Seller shall not fabricate any of the Supplies covered by the Purchase Order or procure any of the materials required in their fabrication or ship any of such Supplies to Bergstrom except to the extent authorized in written instructions furnished to Seller by Bergstrom. Bergstrom shall have no responsibility for Supplies for which no delivery dates or written delivery instructions have been provided. Shipments in excess of those authorized by Bergstrom may be returned to Seller and Seller shall pay Bergstrom for all packing, handling, sorting, and transportation expense incurred in connection with such return shipments. Bergstrom may from time to time, without penalty, change shipping schedules specified in the Purchase Order or contained in such written instructions or direct temporary suspension of such scheduled shipments.

5. INSPECTION AND ACCEPTANCE. Quality assurance and control shall be Seller’s responsibility, and Seller acknowledges that Bergstrom relies on Seller to furnish goods which fully comply with the Purchase Order requirements. Bergstrom shall not be obliged to inspect or test goods prior to first use or application, but has the right, at its sole option, to do so. Bergstrom’s inspection, testing, or acceptance does not relieve Seller of any of its responsibilities or warranties for the Supplies. Bergstrom shall have the right to reject and return at Seller’s cost and risk such portion of any shipment that fails to comply with specifications. All handling and freight costs incurred by Bergstrom as a result of the non-conforming goods will be reimbursed by Seller.

6. WARRANTY. Seller expressly warrants and guarantees to Bergstrom, and to Bergstrom’s successors, assigns, and customers, that all Supplies delivered to Bergstrom pursuant to the Purchase Order will:

a. conform to specifications, drawings, samples, or other description furnished or specified by Bergstrom;

b. be fit and sufficient for the purpose intended, merchantable, and free from defects in material, workmanship and assembly, and design;

c. conform to all applicable laws, orders, regulations and standards in countries where Supplies (or products incorporating such Supplies as components) are made, sold, or used;

d. not infringe upon, violate or misappropriate the patent, copyright, trademark, trade name, trade dress, trade secrets, or any other proprietary or intellectual property rights of any third party; and

e. have good title be free and clear of all liens, security or possessory interests or other encumbrances.
Warranties implied at law are also part of this purchase order.

For all services, Seller further warrants that its work will be performed in a professional and workmanlike manner, by properly licensed and trained personnel, consistent with all standards and specifications agreed on with Bergstrom, and otherwise consistent with industry standards.
If Bergstrom gives Seller notice of breach of any of the Warranties set forth above with respect to the Supplies, Seller shall, at its own cost and expense, promptly repair or replace the defective or nonconforming Supplies and compensate Bergstrom for all related losses, damages, or expenses, including but not limited to costs for any safety recall or field actions, labor, replacement, assembly and disassembly, detection and analysis, scrapping, and transportation of repaired or replacement product or component to Bergstrom and/or its customers or end-users. In the event of Seller’s breach, Bergstrom shall have all remedies provided at law, including the right to recover consequential damages.

7. SUPPLIER QUALITY. Seller will conform to the quality control standards and inspection system, as well as related standards and systems (including without limitation, quality control policies, latest active edition of ISO 9001 or ISO/TS 16949), that are established or directed by Bergstrom. Seller will also comply with the following Bergstrom programs, standards, and requirements: (a) Bergstrom Supplier Manual (including all subsections and forms), as posted on Bergstrom’s website, the link for which is included on each Purchase Order, and (b) supplier performance evaluations. In the event of any conflict between any part of the above programs or standards and an express provision of these Terms and Conditions, these Terms and Conditions will control

8. TERMINATION AT OPTION OF BERGSTROM. Bergstrom may cancel or terminate all or any part of a Purchase Order at its option at any time prior to Bergstrom’s acceptance of Supplies by delivering to Seller a written notice of termination. Upon termination by Bergstrom under this paragraph, Bergstrom agrees to reimburse Seller the actual cost of Finished Goods Inventory (“FGI”), Work-in-Process (“WIP”), and components and raw materials purchased by Seller to fulfill the Purchase Order prior to the date of termination/cancellation by Bergstrom. In no event shall such reimbursement exceed the purchase price under the Purchase Order. Seller shall provide Bergstrom a detailed list of the FGI, WIP, components and raw materials for which it seeks to be paid upon termination of work by Bergstrom under this paragraph within thirty (30) calendar days after the date Bergstrom delivers a notice of termination, or Seller shall be deemed to have waived any right for reimbursement therefor. Prior to reimbursement, and at Bergstrom’s request, Seller will convert some or all of the WIP to FGI or service components. Any partial termination under the Purchase Order shall not alter or affect the Terms and Conditions of the Purchase Order to the extent not terminated.

9. TERMINATION FOR CAUSE. In addition to all other rights provided herein, Bergstrom may cancel or terminate all or any part of this Agreement or any Purchase Order, at any time, without liability to Seller, if Seller (a) materially repudiates, breaches or threatens to breach any of the terms of the Purchase Order, including failure to deliver Supplies by the specified delivery date, (b) fails to make progress or to meet reasonable quality requirements so as to endanger timely and proper completion or delivery of Supplies and does not correct the failure or breach within ten (10) days after receipt of written notice from Bergstrom specifying the failure or breach, (c) becomes insolvent, files a petition for bankruptcy or commences or has commenced against it proceedings relating to bankruptcy, receivership, reorganization or assignment for the benefit of creditors, or (d) or notifies Bergstrom of a force majeure event that persists and precludes its performance for thirty (30) or more days subject to and as set forth in Paragraph 18.

10. TRANSITION OF SUPPLY. In connection with termination or cancellation of the Agreement or any Purchase Order by either party for any reason whatsoever, including Bergstrom’s decision to change to an alternate source of supply for the Supplies or Seller’s rejection of any release issued by Bergstrom, Seller will fully cooperate in the transition of supply to a new supplier. Seller will continue production and delivery of all Supplies as released by Bergstrom, at the prices and other terms stated in the Purchase Order, without premium or other condition, during the entire period reasonably needed by Bergstrom to complete the transition to the alternate supplier, such that Seller’s action or inaction causes no interruption in Bergstrom’s ability to obtain Supplies as needed. Seller will promptly provide all information and documentation reasonably requested by Bergstrom regarding and access to Seller’s manufacturing process for the Supplies including on-site inspections, bill of material data, tooling, process detail and samples of components. If the transition occurs for reasons other than Seller’s termination or breach, Bergstrom will, at the end of the transition period, pay the reasonable, actual cost of transition support as requested and incurred, provided that Seller has advised Bergstrom prior to incurring such amounts of its estimates of such costs.

11. CHANGES. Bergstrom may at any time, by written order, make changes in (i) drawings, designs, and/or specifications applicable to the Supplies covered by the Purchase Order, (ii) the method of shipment or packaging, (iii) place of delivery, and/or (iv) date of shipment. Any such changes shall be deemed to not affect the time for performance or the cost of manufacturing supplies or furnishing services unless Seller notifies Bergstrom in writing within ten (10) days after Bergstrom notifies Seller of such changes. Upon receipt of such notification from Seller, if any, Bergstrom may cancel or otherwise modify such change order.

12. BERGSTROM’S PROPERTY. All drawings, specifications, supplies, materials, facilities, tools, jigs, dies, fixtures, patterns, and equipment furnished to Seller by Bergstrom to perform the Purchase Order shall remain the property of Bergstrom, and Seller shall bear the risk of loss or damage to any such property during Seller’s possession or use. Seller is solely responsible for inspecting, testing and approving all Bergstrom’s property prior to any use, and Seller assumes all risk of injury to persons or property arising from Bergstrom’s property. Such property shall at all times be properly housed and maintained by Seller, and Seller shall mark such property: “PROPERTY OF BERGSTROM INC.” Seller may not release or dispose Bergstrom’s Property to any third-party without the express written permission of Bergstrom. Bergstrom shall have the right to enter onto Seller’s premises at all reasonable times to inspect such property and Seller’s records with respect thereto. Upon request of Bergstrom, Seller shall immediately deliver the consigned property to Bergstrom F.O.B. Seller’s plat packed and marked according to Bergstrom’s instructions. Any tooling paid for by Bergstrom is Bergstrom’s property and may be removed from Seller’s premises at Bergstrom’s discretion. Bergstrom has the right to take immediate possession of Bergstrom’s property at any time without payment of any kind, and Seller agrees to cooperate with Bergstrom if Bergstrom elects to take possession of Bergstrom’s property. To the extent Bergstrom and Seller have entered into a Bailment Agreement, the terms of such agreement shall apply as though incorporated herein, and in the event of any conflict shall have priority over the terms of this Paragraph 12.

13. COMPLIANCE WITH LAWS AND REGULATIONS. Seller, by contracting with Bergstrom, certifies that it has read, understands, has complied with and shall, during the performance of the Agreement, continue to comply with all applicable laws, rules and regulations relating to (a) the manufacture, labeling, transport, import, export, licensing, approval or certification of the Supplies, and (b) environmental matters, hazardous materials, hiring, wages, hours and conditions of employment, subcontractor selection, discrimination, occupational health or safety and motor vehicle safety. This includes but is not limited to compliance with the Fair Labor Standards Act, Equal Employment Opportunity Act, the U.S. Foreign Corrupt Practices Act and any applicable anti-bribery Laws of other countries, the laws and regulations administered and enforced by U.S. Customs and Border Protection (“CBP”), the U.S. Export Administration Regulations, the International Traffic in Arms Regulations, the sanctions regulations administered by the U.S. Treasury Department Office of Foreign Assets Control and the U.S. Department of State, the Sarbanes-Oxley Act, the Uyghur Forced Labor Prevention Act (“UFLPA”), any government procurement laws (or Executive Orders related thereto) in effect at the time of acceptance or during the performance of the Agreement, as well as all requirements detailed in the Supplier Manual, both of which are available on Bergstrom’s website and incorporated herein. Seller shall defend, indemnify and hold Bergstrom harmless for any claimed violations of all such applicable laws, rules and regulations.

14. FORCED LABOR. Bergstrom prohibits all forms of Forced Labor in its supply chain and will reject any shipment containing Supplies that involve the use of Forced Labor. Seller confirms that no form of Forced Labor was involved at any processing stage, directly or indirectly, e.g., in the sourcing, mining, production or manufacture in whole or in part, of any Supplies sold to Bergstrom. “Forced Labor” shall have the definition given that term in the UFLPA and includes any form of child, prison, indentured, bonded, coerced or involuntary labor or labor obtained through human trafficking or other forms of exploitation as well as situations where any of the indicators provided by the International Labor Organization (www.ilo.org) exist or where CBP has presumed Forced Labor exists.

a. Seller specifically agrees that it will comply with all U.S. laws and regulations applicable to importing merchandise into the U.S. including: maintaining all required documentation and certifications to meet admissibility requirements; responding promptly, completely and substantively to all inquiries for information submitted by CBP, including, but not limited to, inquires made to ascertain whether the Supplies were sourced/mined, produced, or manufactured wholly or in part by Forced Labor; and as required, providing on a timely basis documentation that, by clear and convincing evidence, demonstrates the Supplies it sells to Bergstrom were not sourced/mined, produced, or manufactured wholly or in part by Forced Labor. If Seller fails to comply with the foregoing sentence, Bergstrom may, at its election and in its sole discretion, immediately terminate or suspend the Agreement and all other contracts with Seller, without penalty or cost to Bergstrom.

b. Seller agrees to defend, indemnify and hold harmless Bergstrom against any and all fines, penalties, damages, costs and expenses incurred by Bergstrom, including legal fees, should any of Seller's shipments be detained, seized or, in the alternative, returned either to Seller or to another destination based on a failure of Seller to comply with this Section 14.

c. If Seller identifies Forced Labor conditions in its supply chain, it will promptly notify Bergstrom and immediately begin remediation. Seller shall communicate its progress to Bergstrom on at least a weekly basis, but more frequently if requested by Bergstrom. In the event Supplier cannot or does not remediate the situation in a timely manner, as determined by Bergstrom, Bergstrom may, at its election and in its sole discretion, immediately terminate or suspend the Agreement and all contracts with Seller, without cost or penalty to Bergstrom, without penalty or cost to Bergstrom.

d. Seller is required to notify Bergstrom in writing of Supplies (including any materials or components incorporated in the Supplies) sold to Bergstrom that Seller purchases in a country other than the country in which the Supplies are provided to Buyer. Seller is further required to notify Bergstrom in writing in advance of relocating the sourcing or production of Supplies or any materials or components incorporated therein. Seller agrees to provide a certification that it has conducted its supply chain due diligence and attest that no form of Forced Labor is involved at any processing stage, directly or indirectly, i.e., in the mining, production or manufacture in whole or in part, of any Supplies sold to Bergstrom resulting from that relocation.

15. INSURANCE.

a. The following requirements shall apply to all work under the Purchase Order. Compliance is also required by all suppliers, sub-suppliers, contractors and subcontractors of any tier. No work of any kind shall be commended under the Purchase Order until all insurance requirements contained in these Terms and Conditions have been complied with. Upon Bergstrom’s request, Seller shall provide Bergstrom with a certificate of insurance evidencing the insurance coverage specified in this Section naming Bergstrom as an additional insured with respect to any work performed or Supplies supplied under the Purchase Order. All insurance required by these Terms and Conditions shall be maintained until all of Seller’s obligations under the Purchase Order, including any extensions thereto, have been fulfilled. Approval or acceptance of the insurance by Bergstrom shall not relieve or decrease the liability of the Seller or Contractor hereunder and failure to maintain insurance shall constitute a material breach of these Terms and Conditions.

b. Seller shall provide, without exception, at least thirty (30) days’ written notice prior to any cancellation of insurance unless for non-payment of premium. For non-payment of premium cancellations, Seller shall provide ten (10) days’ written notice of cancellation.

c. It is expressly agreed and understood by and between Seller and Bergstrom that the insurance afforded through the additional insured endorsement shall be the Primary insurance and that any other insurance carried by Bergstrom shall be excess of all other insurance carried by Seller and shall not contribute with the Seller’s insurance. Seller waives any right of recovery and will cause their insurers to waive their rights of subrogation under all insurance policies required.

d. Coverage Limits. All insurance policies must be written by companies with a current Best’s rating (as set forth in the most current edition of Best’s Key Rating Guide, published by A.M. Best and Company), of A-VIII or better or equivalent rating of another rating agency. The following minimum insurance coverage and limits are required. Where insurance coverage and/or limits are mandated by local law or statue, local requirements apply subject to the minimum limits stated below.

Type of Insurance

Minimum Limits

Commercial General Liability (“CGL”)*, insurance (Occurrence Coverage) for bodily injury and property damage arising from premises, operations, personal injury, products / completed operations, and contractual liability covering the indemnity provision as set forth in the Indemnification section.

$3,000,000 Per Occurrence, General Aggregate, Product and Completed Operations Aggregate, Personal & Advertising Injury

Automobile Liability (“Auto”) covering all autos used in connection with the work performed

$1,000,000 combined single limit covering property damage and bodily injury

Workers’ Compensation

Statutory

16. GENERAL INDEMNIFICATION. To the fullest extent permitted by law, Seller shall defend, indemnify and hold harmless Bergstrom and Bergstrom’s subsidiaries, affiliates, successors or assigns, and Bergstrom’s Customers and end users of any products incorporating the Supplies (collectively, “Bergstrom Indemnitees”) from and against any and all loss, personal injury, death, property or other damage, liability, claim, deficiency, action, judgment, settlement, interest, award, penalty, fine, cost or expense, including reasonable attorney and other professional fees and costs, the cost of enforcing any right to indemnification hereunder, and/or the cost of pursuing any insurance providers (collectively, “Claims and Losses”) arising out of, related to, or otherwise occurring in connection with (a) this Agreement or the subject of the Purchase Order, (b) the Supplies purchased from Seller, including any claim of personal injury, death, or property damage by an end-user of any products incorporating such Supplies as components, (c) Seller’s breach of the Agreement, these Terms and Conditions, or any of the warranties set forth herein, (d) Seller’s negligence or willful misconduct in performing its obligations under the Agreement or Purchase Order or in designing, manufacturing, assembling, supplying, or shipping the Supplies, (e) Seller’s noncompliance with applicable law or regulations with respect to the Supplies, or (f) any recall or similar corrective action caused by or related to the Supplies or the products incorporating the Supplies as components.

In the event Seller has accepted tender of indemnity and defense from Bergstrom, Seller shall not enter any settlement without Bergstrom’s or Bergstrom Indemnitee’s prior written consent, which shall not be unreasonably withheld.

17. INTELLECTUAL PROPERTY AND INTELLECTUAL PROPERTY INDEMNIFICATION.

a. Seller may only use the Intellectual Property Rights of Bergstrom and any Bergstrom subsidiaries or affiliates, whether such Intellectual Property Rights are part of the Supplies or in Tooling, for the production and supply of Supplies to Bergstrom, Bergstrom affiliates and subsidiaries, or Third-Party Designees (as specified by Bergstrom) and may not use such Intellectual Property Rights for the production and/or supply of any goods or services to any other party without written consent from Bergstrom. If Bergstrom or a Bergstrom affiliate or subsidiary pays, or otherwise compensates Seller for development or design work initiated by Bergstrom for Supplies or Tooling, any Intellectual Property Rights arising from such work shall be owned by Bergstrom, unless otherwise agreed in writing. To the extent that any such development or design work includes Seller-owned pre-existing Intellectual Property, then Bergstrom, and Bergstrom’s customers shall have a paid-up royalty-free license to use such Pre-existing Intellectual Property as long as the Supplies are purchased from Seller. Seller shall not use any corporate name or trademarks belonging to or licensed to Bergstrom unless Bergstrom provides advance consent in writing.

b. Seller is responsible for ensuring that the Supplies, including any part of the Supplies, as well as the Supplies’ use, does not infringe the Intellectual Property Rights of any third party. Seller shall, at its expense, defend, indemnify and hold harmless Bergstrom and any Bergstrom Indemnitee against any and all Claims and Losses (as defined in Paragraph 16 above) arising out of or in connection with any claim that Bergstrom’s or Bergstrom Indemnitee’s use or possession of the Supplies infringes or misappropriates or otherwise constitutes a wrongful use of the patent, copyright, trade secret or other intellectual property right of any third party, including claims of direct infringement, contributory infringement, or inducement to infringe any proprietary right. Seller expressly waives any claim against Bergstrom that such infringement arose out of compliance with Bergstrom’s specification, except to the extent such infringement is actually embodied in designs created by Bergstrom and provided in writing to Seller. In the event Seller has accepted tender of indemnity and defense from Bergstrom pursuant to this section, Seller shall not enter any settlement without Bergstrom’s or Bergstrom Indemnitee’s prior written consent.

c. If the use or sale of the Supplies listed in the Purchase Order is enjoined as a result of such claim or suit, or Bergstrom has reason to believe such Supplies are or are likely to become the subject of an infringement claim. Seller shall, within forty-five (45) calendar days after receiving notice of the claim or allegation, at its option and at no expense to Bergstrom: (a) obtain for Bergstrom or Bergstrom Indemnitees the perpetual right or license to continue to use the affected Supplies, (b) modify the affected Supplies to make them non-infringing, provided the modified Supplies must have at least the same functionality of the original Supplies and not be more expensive to use or maintain, or (c) replace the Supplies with non-infringing products, provided the replacement products have at least the same functionality of the original Supplies and not be more expensive to use or maintain, and extend this indemnity thereto.

18. SETOFF. In addition to any remedies provided by law, including any legal right of setoff or recoupment, all amounts due to Seller will be considered net of indebtedness of Seller and Seller’s subsidiaries and affiliates to Bergstrom and Bergstrom’s subsidiaries and affiliates. Bergstrom will have the right to deduct or set off against or to recoup from any payment or other obligation owed to Seller, in whole or in part, the amounts of any claims Bergstrom may have against Seller or any amounts otherwise due to Bergstrom or Bergstrom’s subsidiaries or affiliates from Seller or Seller’s subsidiaries and affiliates. Bergstrom will provide Seller with a statement describing any offset or recoupment taken by Bergstrom.

19. LIMITATION OF LIABILITY AND WAIVER OF CONSEQUENTIAL DAMAGES. Under no circumstances shall Bergstrom be required to pay Seller any indirect or consequential damages or fees, including those related to loss of anticipated profit, unabsorbed overhead, interest on claims, product development and engineering costs, tooling, facilities and equipment rearrangement costs or rental, unamortized capital or depreciation costs, general administrative burden charges, or loss of business opportunity, or damage to reputation, for any claimed breach by Bergstrom or any claimed wrongful termination of the Agreement or any Purchase Order, regardless if directly incurred or indirectly on account of Seller’s suppliers or subcontractors. Bergstrom’s maximum liability to Seller shall not exceed the aggregate amount actually paid or payable by Bergstrom under the Purchase Order at issue.

20. FORCE MAJEURE. Neither Party shall be liable for a delay or failure to perform when and to the extent caused by one or more of the following force majeure events, provided the event of force majeure could not have been foreseen by such Party or, if it could have been foreseen, was unavoidable: acts of God, natural disaster, governmental action, war, civil disturbance, riot, lockout, sabotage, or embargo, natural disaster, or other unforeseen condition beyond the control of the Party, but excluding any conditions or events caused in whole or in part by that Party’s negligence or willful misconduct. The Party suffering an event of force majeure shall provide the other Party with prompt written notice and shall be excused from performing its obligations under the Agreement or any Purchase Order for so long as such condition persists, but shall not be excused from tendering partial performance if the same is possible. In the case of an event of force majeure, Bergstrom, at its option, may acquire possession of all finished Supplies at the then current price and work-in-process and raw materials produced or acquired for work under the Purchase Order at the price paid by Seller. If a force majeure event lasts for a period of thirty (30) days or more, Bergstrom may elect to terminate the Agreement or any Purchase Order upon written notice to Seller as provided in Paragraph 9.

21. SUPPLY FAILURE. In the event of a full or partial failure of Seller’s sources of supply or capacity constraints for the Supplies, Seller is required under the Agreement to first meet all of Bergstrom’s requirements under any Purchase Order or forecast prior to any allocation among customers under Section 2-615 of the Illinois Uniform Commercial Code – Sales, 810 ILCS 5/2-101 et. seq.

22. NONASSIGNMENT. Seller shall not assign or delegate its obligations under this Agreement or the Purchase Order without prior written consent of Bergstrom. Any purported assignment in violation of this Section shall be void, and no assignment or delegation shall relieve the Seller of any of its obligations hereunder. In the event of any approved assignment or delegation authorized by Bergstrom, Seller shall retain all responsibility for the Supplies, including all related warranties and claims, unless otherwise expressly agreed in writing by Bergstrom.

Bergstrom may at any time assign, transfer or subcontract any or all of its rights or obligations under the Agreement or Purchase Order without Seller’s prior written consent.

23. REPORTING INCENTIVES. Seller represents that is has not paid to any Bergstrom employee any commission, fee, or rebate, or provided any gifts or entertainment of value greater than $100.00, unless such payment or gift been reported in writing to Bergstrom’s Chief Financial Officer.

24. TAXES. Absent a written acknowledgment by Bergstrom to the contrary, all taxes, including but not limited to federal, state and local income taxes, value added taxes, gross receipts taxes, property taxes, broker fees and customs duties taxes (“Taxes”), are deemed to be included in the price for the Supplies set forth in the Purchase Order. In the event that any taxing authority has claimed or does claim payment for Taxes, Seller shall promptly pay such taxes and defend, indemnify, and hold Bergstrom harmless from and against all such claims, including all expenses of defense. Any Taxes included in the price for the Supplies must be accounted for separately on the invoice, and any VAT refunds which were included in the price must be refunded to Bergstrom.

25. PRICE AND TERMS OF PAYMENT. The price of the Supplies is the price stated in the Purchase Order. No increase in the price is effective, whether due to increased material, labor or transportation costs or otherwise, without the prior written consent of Bergstrom.

Seller shall issue an invoice to Bergstrom on or any time after the completion of delivery and only in accordance with these Terms and Conditions. Unless expressly agreed upon otherwise by the parties, payment for all properly invoiced amounts shall be due from Bergstrom within sixty (60) days of Bergstrom’s acceptance of the applicable Supplies. Payment will be made in the currency expressly stated in the Purchase Order; if no such currency is noted, payment will be made in U.S. Dollars.

26. NON-WAIVER. Bergstrom’s failure at any time to enforce any provision or right in connection with the Purchase Order shall not constitute a waiver of such provision or prejudice Bergstrom’s right to enforce such provision at any subsequent time.

27. SEVERABILITY. If any provision of the Agreement is declared invalid by a court of competent jurisdiction, such provision shall be ineffective only to the extent of such invalidity and the remainder of that provision and all remaining provisions hereof shall continue in full force and effect.

28. SUCCESSORS, ASSIGNS; NO THIRD-PARTY BENEFICIARIES. The Agreement shall inure to the benefit of and be binding on each of the parties hereto and their respective successors and permitted assigns; provided however, that any such assignment has been in compliance with the Terms and Conditions. The Agreement is for the sole benefit of the parties hereto and their respective successors and permitted assigns and nothing herein, express or implied, is intended to or shall confer upon any other person or entity any legal or equitable right, benefit or remedy of any nature whatsoever under or by reason of these Terms.

29. CONFIDENTIALITY.

a. Seller agrees to maintain in strict confidence any and all confidential or proprietary information which Seller receives from Bergstrom (including, without limitation, product specifications, samples, patterns, designs, plans, drawings, documents, data, business operations, customer lists, pricing, discounts or rebates, or which otherwise constitutes trade secrets or confidential and proprietary information relating to Bergstrom’s business, products, services, or customers) and which is not already in the public domain (the “Confidential Information”), whether disclosed orally or accessed in written, electronic or other form or media, and whether or not marked, designated or otherwise identified as “Confidential”. Seller further agrees its use of the Confidential Information is strictly and solely limited for the use of performing its obligations under the Agreement and that it shall not disclose, publish or reveal in any way the Confidential Information to any person or entity (including, without limitation, governmental entities) who do not have a need to have such disclosure in order to enable Seller to fulfill its obligations hereunder, without Bergstrom’s prior written consent, which Bergstrom may withhold in its sole and absolute discretion. Information which Seller is required to disclose by reason of law or order of a court of a competent jurisdiction may however be disclosed for such purpose, provided Seller promptly notifies Bergstrom of any such requirement and consults with Bergstrom regarding the manner of such disclosure in advance. In such case, Seller shall, as far as is legally possible, require the receiver of the information to treat it confidential as required in this Section.

b. Bergstrom shall be entitled to injunctive relief for any violation of this Section. This Section shall not apply to information that is: (a) in the public domain; (b) known to the Seller at the time of disclosure; or (c) rightfully obtained by the Seller on a non-confidential basis from a third party. Notwithstanding the foregoing, any non-disclosure agreement between the parties that predates the acceptance of the Purchase Order will remain in effect except as expressly modified by this Agreement.

c. Seller’s obligation under this paragraph shall survive termination of the Agreement between Seller and Bergstrom. To the extent Bergstrom and Seller have entered into a Nondisclosure Agreement, the terms of such agreement shall apply as though incorporated herein, and in the event of any conflict herein, shall have priority over the terms of this Paragraph 29.

30. CHOICE OF LAW. The Agreement is governed by and shall be construed and interpreted according to the laws of the State of Illinois and the Uniform Commercial Code, as adopted by Illinois, without regard to conflict of laws principles. The provisions of the United Nations Convention on Contracts for the International Sale of Goods of 1980 (and any amendments or successors thereto), and any conflict of laws provisions that would require application of another choice of law, are expressly excluded.

31. RIGHTS AND REMEDIES. The remedies available to Bergstrom under these Terms and Conditions are cumulative and, except as expressly limited herein or otherwise in writing, will not preclude the assertion or exercise of any other rights or remedies available to Bergstrom under law, in equity, or otherwise.

32. CONSTRUCTION. It is expressly agreed that in the construction and interpretation of the Agreement, including these Terms and Conditions,, the rule of construction that a document is to be construed most strictly against the party who prepared the same shall not apply.

33. SURVIVAL. Except as otherwise provided herein, the provisions stated in the Purchase Order and these Terms and Conditions which by their nature should apply beyond their terms will remain in force after any expiration or termination of the Agreement, including but not limited to the provisions relating to indemnification, warranty, liability and limits thereon, confidentiality and/or protections of proprietary rights and trade secrets, and dispute resolution.

34. DISPUTE RESOLUTION. If any dispute occurs between Bergstrom and Seller arising from, relating to, or in connection with this Agreement, the Purchase Order, or the Supplies that are the subject of the Purchase Order, the parties shall promptly attempt in good faith to resolve same by negotiation between the parties’ relevant business executives. At any time, and at Bergstrom’s sole election, the parties shall participate in mediation to assist in resolving the dispute. The location of the mediation shall be in Chicago, Illinois, unless both parties agree in writing to a different location, and the costs shall be borne equally by the parties. If the parties are unable to agree on a resolution after exhausting these procedures, either party may seek resolution pursuant to the provisions of Paragraph 35 below.

35. FORUM; JURISDICTION; OPTIONAL ARBITRATION.

a. Except as hereinafter provided, any claim or dispute arising from, relating to, or in connection with this Agreement, the Purchase Order, or the Supplies that are the subject of the Purchase Order (whether such claim is based in contract, tort, or otherwise), that is not settled by negotiation or mediation as set forth in Paragraph 34 above, other than a claim for injunctive relief governed by Paragraph 36 below, shall be subject to the exclusive venue and jurisdiction of the U.S. District Court in the Northern District of Illinois in Rockford or Chicago, or in the event that such federal court does not have jurisdiction, in the Winnebago County Circuit Court. Seller hereby irrevocably waives any objection to jurisdiction or venue of any action instituted hereunder and shall not assert any defense based on lack of jurisdiction or venue or based upon the doctrine of forum non conveniens. Seller also irrevocably waives personal service of process and consents to process being served in any suit, action or proceeding in connection with this Agreement, the Purchase Order, or the Supplies that are the subject of the Purchase Order, by mailing a copy thereof via registered, certified mail, and/or overnight delivery to such party at the address identified in the Purchase Order.

b. Notwithstanding the foregoing, and at Bergstrom’s sole option, exercised by written notice any time before or within thirty (30) days following the service of process in any legal action arising from any claim or dispute relating to this Agreement, the Purchase Order, or the Supplies that are the subject of the Purchase Order (other than a claim for injunctive relief), will be resolved by binding arbitration in Chicago, Illinois, conducted in the English language, using a single arbitrator. The parties shall attempt to agree on an arbitrator from the commercial arbitrator list provided by the ADR organization in which Bergstrom initiates the arbitration proceedings. If the parties cannot agree on an arbitrator, selection will be governed by the rules of the applicable ADR organization. The arbitrator will issue written findings of fact and conclusions of law and may award attorneys’ fees and costs to the substantially prevailing party if recoverable under the law or the Agreement. In no event will any party be awarded punitive or exemplary damages. The award of the arbitrator will be final and enforceable and judgment over the award may be entered by any court authorized under this Agreement or otherwise having jurisdiction over the relevant party and its assets. The arbitration provisions of this Section will be governed by the United States Federal Arbitration Act.

36. INJUNCTIVE RELIEF. Notwithstanding Paragraph 35, any request for injunctive relief arising from, relating to, or in connection with this Agreement, the Purchase Order, or the Supplies that are the subject of the Purchase Order may be brought by Bergstrom in any court(s) having jurisdiction over Seller or, at Bergstrom’s option, in the applicable court closest to the place from which the Purchase Order was issued by Bergstrom, in which event Seller consents to the jurisdiction and venue of such court.

37. RELATIONSHIP OF PARTIES. Seller and Bergstrom are independent contracting parties and nothing in the Agreement or any Purchase Order will make either party the employee, agent or legal representative of the other for any purpose. Neither the Agreement, nor any Purchase Order, grants either Party any authority to assume or to create any obligation on behalf of or in the name of the other. Seller will be solely responsible for all employment and income taxes, insurance premiums, charges and other expenses it incurs in connection with its performance this Agreement, unless expressly provided otherwise in writing by Bergstrom. All employees and agents of Seller or its respective contractors are employees or agents solely of Seller or such contractors, and not of Bergstrom, and are not entitled to employee benefits or other rights accorded to Bergstrom’s employees. Bergstrom is not responsible for any obligation with respect to employees or agents of Seller or its contractors.