SALES TERMS AND CONDITIONS

  1. OFFER AND ACCEPTANCE. “BUYER” MEANS THE PURCHASER OR BUYER AS REFLECTED IN THE PROPOSAL, PURCHASE ORDER, OR ACKNOWLEDGMENT (THE “PROPOSAL”) TO WHICH THESE TERMS AND CONDITIONS ARE ATTACHED OR INCORPORATED BY REFERENCE. BUYER’S OFFER TO PURCHASE PRODUCTS (INCLUDING ALL PRODUCTS SUBJECT TO THE PROPOSAL) IS EXPRESSLY MADE CONDITIONAL ON BUYER’S ASSENT TO THESE TERMS AND CONDITIONS, WHICH CONSTITUTE A BINDING CONTRACT BETWEEN DIVERSIFIED PLASTICS, INC.’S (“SELLER”) AND BUYER (THE “PARTIES”). THIS CONTRACT CONSTITUTES THE COMPLETE AND FINAL AGREEMENT BETWEEN THE PARTIES FOR THE PRODUCTS. ANY ADDITIONAL OR DIFFERENT TERMS OR CONDITIONS CONTAINED IN ANY DOCUMENT FURNISHED BY BUYER, INCLUDING BUT NOT LIMITED TO, ANY PURCHASE ORDER OR ANY ACKNOWLEDGMENT, ARE DEEMED TO BE MATERIAL AND ARE HEREBY OBJECTED TO AND REJECTED BY SELLER. IF SUCH AGREEMENT SHALL BE DEEMED AN OFFER OR COUNTER-OFFER BY BUYER, SELLER EXPRESSLY REJECTS SUCH OFFER OR COUNTER-OFFER. SELLER LIMITS ACCEPTANCE TO THESE CONTRACT TERMS AND EXPRESSLY OBJECTS TO ANY DIFFERENT OR ADDITIONAL TERMS PROPOSED BY BUYER. ANY ACTUAL PERFORMANCE BY BUYER OR SELLER THEREAFTER SHALL BE DEEMED A RENEWAL OF THE OFFER CONTAINED IN THIS CONTRACT AND ACCEPTANCE OF THIS CONTRACT WITHOUT CHANGE. IN THE EVENT OF A CONFLICT BETWEEN THE TERMS OF THIS CONTRACT AND THE TERMS OF ANY OTHER DOCUMENT, THE TERMS OF THIS CONTRACT SHALL CONTROL. THE OFFER TO SELL SELLER’S PRODUCTS IS VALID FOR THIRTY (30) DAYS FROM THE DATE OF THE PROPOSAL.
  2. PRICE. Prices quoted are for parts and/or tooling manufactured from materials at current pricing. Seller reserves the right to increase prices at any time prior to acceptance or release of an order. Seller reserves the right to correct any clerical or mathematical errors. Where orders are placed for quantities other than those specified in the quotation, the unit price for the next smallest quantity quoted applies. Unless otherwise noted, prices quoted are for quantities run and shipped in a single lot. For split shipments, the price is quoted on a per-shipment basis. Prices quoted do not reflect any federal or state taxes or tariffs. When applicable, such taxes and tariffs will be added to invoices as prescribed by state, federal, or local law. Over/Under Runs. If Seller produces a greater or lesser quantity of products than Buyer ordered, the total price for such products shall be calculated using the unit price quoted in the Proposal. Unless otherwise expressly provided in the Proposal, Buyer must accept shipments whose quantity exceeds or falls short of the ordered quantity by five percent (5%) or less on orders of 500 or more products. Buyer must accept shipments whose quantity exceeds the ordered quantity by fifteen percent (15%) or less on orders of less than 500 products. For under runs, orders will be considered complete for quantities shipped.
  3. PAYMENT. Unless otherwise expressly provided in the Proposal, Buyers with established credit shall pay in full within thirty (30) days from the earlier of the date of delivery or the date of an invoice. For domestic tooling orders, and unless otherwise expressly provided in the Proposal, Buyer shall pay 33% upon placing the order, 33% upon Seller’s submission of tool samples to Buyer, and the balance upon Buyer’s acceptance of such samples. For international tooling orders, and unless otherwise expressly provided in the Proposal, Buyer shall pay 50% upon placing the order, and the balance upon Seller’s commencing shipment. A financing charge of 1.5% per month on all unpaid invoices past due shall apply.
  4. SHIPMENT; DELIVERY; TITLE. All shipments are F.O.B. Seller’s facility. Unless customer specifies a mode of transportation, Seller shall ship as determined in its sole and absolute discretion. All risk of damage to or loss of the products from any cause whatsoever shall pass to Buyer upon delivery to the carrier, even if Seller arranges for shipment of the product. Unless specifically requested, Seller shall carry no insurance against loss or damage of merchandise. When so requested, Seller shall obtain insurance at customer’s expense. No claims shall be accepted by Seller for shipments that are damaged, delayed, or lost. Unless otherwise expressly provided in the Proposal, Seller shall package products in bulk using Seller’s standard containers. Any delivery or promise date indicated on the Proposal is an estimate of the date Seller believes the products will be available for delivery, provided, however, Seller shall not be responsible for any delays in delivery.
  5. WARRANTY.
    a. Limited Warranty; Exclusion of Third Party Materials. Subject to the terms, conditions and limitations contained herein, Seller warrants only to the original Buyer that Seller’s new products will not materially fail to operate in accordance with their specifications due to defects in workmanship during the period which ends thirty (30) days from the date of delivery, normal wear and tear excluded. The foregoing period is sometimes referred to as the “original warranty period.” The foregoing limited warranty does not apply to any plastic, resin, materials or components manufactured or supplied by a third-party for use in the manufacturing or assembly of any product (“Third-Party Material”).
    b. DISCLAIMER OF ALL OTHER WARRANTIES, EXPRESS, IMPLIED OR STATUTORY. THE LIMITED WARRANTY SET FORTH IN THE FOREGOING PARAGRAPH IS THE SOLE AND EXCLUSIVE WARRANTY WITH RESPECT TO THE PRODUCTS. SELLER MAKES NO OTHER EXPRESS WARRANTY OF ANY KIND OR NATURE AS TO THE PRODUCTS OR THEIR PERFORMANCE EXCEPT FOR THOSE LIMITED WARRANTIES EXPRESSLY SET FORTH IN THE FOREGOING PARAGRAPH AND SPECIFICALLY DISCLAIMS ANY AND ALL REPRESENTATIONS OR WARRANTIES OF ANY KIND OR NATURE CONCERNING THE PRODUCTS, INCLUDING, BUT NOT LIMITED TO, ANY REPRESENTATION OR WARRANTY THAT THE PRODUCTS COMPLY WITH ANY LAW, RULE OR REGULATION. SELLER MAKES NO WARRANTIES WITH RESPECT TO ANY THIRD PARTY MATERIAL AND SELLER SPECIFICALLY SELLS SUCH THIRD-PARTY MATERIAL “AS IS” WITHOUT ANY WARRANTY. FURTHER, SELLER MAKES NO IMPLIED WARRANTY OF ANY KIND OR NATURE WITH RESPECT TO ITS PRODUCTS OR ANY THIRD-PARTY MATERIAL AND SPECIFICALLY DISCLAIMS ANY AND ALL IMPLIED WARRANTIES, INCLUDING, BUT NOT LIMITED TO, ANY AND ALL IMPLIED WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, NON-INFRINGEMENT, OR COMPLIANCE WITH ANY FEDERAL, STATE OR LOCAL LAW, RULE OR REGULATION. IN ADDITION, SELLER EXPRESSLY DISCLAIMS TO THE FULLEST EXTENT ALLOWED BY LAW, RULE OR REGULATION ANY WARRANTY PROVIDED UNDER ANY FEDERAL, STATE OR LOCAL LAW, RULE OR REGULATION.
    c. Terms and Conditions of Warranty; Voiding of Warranty; Notice Requirements. The limited warranties set forth above shall be null and void if (a) any alterations or modifications are made to a product, (b) a product is not maintained in strict compliance with the maintenance requirements set forth in the maintenance manual for such product or otherwise provided to Buyer, (c) any repairs are made to a product not authorized by Seller in writing, (d) any failure of a product to comply with the above limited warranty is not reported to Seller in writing within 30 days of the date such failure first occurs, (e) a product is operated after the failure of any warranty first occurs, (f) a product is used for any purpose other than for the purpose for which it was manufactured, (g) a product is not operated in strict compliance with the terms and conditions set forth in any operating manual for the product (including but not limited to exceeding the load bearing capacity of the product), (h) a product is abused or damaged, (i) Buyer fails to deliver the product to Seller for inspection and testing if requested by Seller or Buyer disposes of the product or any part or component on or before the sixtieth (60th) day after sending a written claim under the warranty to Seller, or (j) such failure of the limited warranty results from a failure of any Third-Party Material.
    d. Exclusive Remedies for Breach of Warranty. The sole and exclusive remedy for any failure of any product to comply with the limited warranty set forth above or any other warranty imposed upon Seller by law, if any, shall, at the election of Seller, in its sole discretion, be either (a) the repair or replacement of the product which failed to comply with such warranty or (b) the refund of the purchase price of the product. Buyer shall be responsible for all labor costs in connection with the repair or replacement of any equipment. Except as provided below, any repair or replacement shall carry the same warranty as the original product but only for the remainder of the original warranty period. Buyer’s exclusive remedy with respect to any claim arising out of or as a result of Third-Party Material shall be against the third-party manufacturer.
    e. Warranty Claims; Notice Requirement; Limited Time to Bring Claims. Any and all claims under the above limited warranty shall be made to Seller only in writing and not later than 30 days after the date the product first fails to comply with the above limited warranty but in no event later than the expiration of the original warranty period with respect to which the claim is being made. Any claim under the above limited warranty made after such period for making a claim shall be null and void. After receiving written notice of the warranty claim and Seller’s confirmation that the claimed issue falls under this limited warranty, Seller shall determine whether to (a) repair or replace the product or part or (b) refund the purchase price of the product. Seller may require Buyer to return any product or part thereof which Buyer claims to be defective to Seller at Buyer’s cost for inspection as a condition to any claim under the above limited warranty. No product or part may be returned to Seller without Seller’s prior written authorization. If a product returned is determined by Seller in its sole discretion not to have failed to comply with the limited warranty, Buyer shall pay costs of removal, repair and/or replacement for such product. If a product returned is determined by Seller in its sole discretion to have failed to comply with the limited warranty, Seller shall pay for all repair and/or replacement costs for such product (or refund the purchase price if so elected by Seller) and Seller shall reimburse Buyer for the reasonable costs of shipping the defective product or part to Seller.
    f. Limitation on Liability for Breach of Warranty and Other Claims. Seller’s liability for any failure of any product to comply with any such warranty, together with any and all other liability, if any, arising out of or in connection with such product, including, but not limited to, all claims, whether in contract, tort, or otherwise, arising out of, connected with, or resulting from the manufacture, sale, delivery, resale, repair, replacement, or use of the product, shall not exceed the purchase price for such product. In no event shall Seller be responsible or liable to Buyer or any third party under any circumstances for (i) any indirect, consequential, special, punitive or exemplary damages or losses, (ii) any and all damages for loss of profits, (iii) loss of goodwill or (iv) loss of use of the product or any other equipment or other intangible losses which may be incurred in connection with the product, in each case regardless of the type of claim or the nature of the cause of action, even if Seller has been advised of the possibility of such damage or loss. Any and all claims that Buyer has against Seller, whether or not Buyer is aware of such claims, must be brought by Buyer within 30 days after the date that such claim first arose. Any claim not brought by Buyer within the applicable 30 day period shall be deemed null and void.
  6. RETURNS AND ALLOWANCES. Buyer may return non-conforming products for replacement upon notice to Seller within 30 days of delivery or Buyer shall be deemed to accept such products. Seller will replace such products to the extent any non-conformities exist. Seller assumes no liability for defective products beyond replacement. In the event of variance between blueprints and accepted samples, sample parts will be the standard to determine compliant products. 
  7. TOOL STORAGE AND MAINTENANCE. Seller shall maintain and store all of Buyer’s tools at its climate-controlled facilities. Seller shall not be liable for loss of or damage to tools due to fire, theft or vandalism. Buyer represents and warrants that transfer tools it supplies to Seller are in good working condition and able to produce parts to Buyer’s specifications. Buyer shall pay all maintenance and storage charges if Buyer desires to remove any tool. Charges will become due and payable before the removal of the tool from Seller’s premises. Buyer hereby grants to Seller a lien against such tool until all such payments are paid.
  8. MATERIALS; ADVICE. Seller shall manufacture products using materials specified by Buyer in the Proposal. Unless expressly provided otherwise in the Proposal, reground material may be added to virgin material to manufacture products. Such mixtures will not exceed guidelines set by the material manufacturer to assure the physical properties of the material are not degraded. No liability is assumed for part failure due to Third-Party Material. Seller shall not be liable for any design defects in custom products, or if the products ordered are unsuitable for Buyer’s intended use. Seller makes no covenant, representation or warranty, express or implied, related to (1) selection of the products ordered, the materials used, or the design of any custom product, (2) any advice furnished, or recommendations made by Seller or any employee or representative of Seller, concerning any use or application of any materials, products or parts furnished under this Contract, or (3) any other services provided by Seller. Buyer assumes all responsibility and risk for loss or damage resulting from the recommendation, handling or use of any materials, products or parts in accordance with such advice or recommendation. Any advice or assistance provided by Seller to Buyer in connection with Buyer’s selection of materials or design of the products is at Buyer’s sole risk, and Seller makes no covenant, representation or warranty whatsoever in connection with such advice or assistance.
  9. PROP 65. Seller represents and warrants that, unless expressly noted on the Proposal, the products are not intended to be distributed, whether as a finished good or component included in, a consumer product that is subject to California Proposition 65 (“Prop 65”).
  10. INDEMNIFICATION. Buyer shall indemnify and hold harmless Seller, its affiliates and their respective officers, directors, employees, agents and other representatives and will, at Seller’s option, defend any action brought against the same with respect to any claims, judgments, actions, suits, demands, damages, liabilities, costs or expenses (including, but not limited to, attorneys’ fees and legal expenses), whether as a direct claim by Seller or as a result of any third party claim, associated with or arising from (i) the ownership, use or operation of the products by Buyer or any third party, or (ii) any actual or alleged claims that the Buyer violated Prop 65 with respect to the products (except to the extent the Proposal expressly states that the products are intended to be used as a consumer product).
  11. GOVERNING LAW. This Contract shall be construed, interpreted, and governed by the laws of Minnesota without regard to its conflict of laws principles. The exclusive forum for any disputes arising out of or relating to this Contract shall be any federal or state court sitting in Minneapolis, Minnesota. The parties irrevocably consent to such exclusive jurisdiction in such courts and to the proper venue therein. If Seller must resort to legal action or remedies, Buyer shall reimburse Seller for all of Seller’s legal fees and expenses, whether or not suit is filed by Seller.
  12. FORCE MAJEURE. Seller does not assume the risk of and shall not be liable for failure to perform any obligation caused by civil insurrection, war, riot quarantine, terrorism, fire, strike, labor stoppages or other labor disturbances, acts of God, acts or omissions of Buyer, acts or omissions of any government body or entity, floods, epidemics, freight embargoes, shortages of labor, fuel, energy or materials, failure of suppliers or subcontractors to satisfactorily meet scheduled deliveries, accidents to machinery, delays in transportation or any other cause beyond the reasonable commercial control of Seller. Upon the occurrence of any such event, Seller may terminate this Contract without liability.
  13. NOTICES. Any notices, consents or other communications required or permitted under this Contract must be in writing and delivered personally, overnight air courier, registered or certified mail or facsimile. Unless otherwise stated in this Contract, notices, consents or other communication will be deemed received (a) on the date delivered, if delivered personally or by facsimile transmission; (b) on the next business day if sent via overnight air courier; or (c) three (3) business days after being sent, if sent by registered or certified mail.
  14. MISCELLANEOUS. The invalidity or unenforceability of any provision of this Contract shall not affect the validity or enforceability of any other provision of this Contract. No waiver of any of the provisions of this Contract shall be deemed or shall constitute a waiver of any other provision, whether or not similar, nor shall any waiver constitute a continuing waiver. No waiver shall be binding unless executed in writing by the party making the waiver. The Section headings herein are for the convenience of the parties only and in no way alter, limit or restrict the obligations of the parties. There shall be no third-party beneficiaries to this Contract. Seller shall have the right to deduct from any sums it owes Buyer, any sums or the value of any obligation owed by Buyer to Seller. The terms set forth herein constitute the sole terms and conditions of the Contract. To the extent this Contract conflicts with the terms or conditions of any written agreement between the parties, this Contract shall control. No other warranty, term, condition or understanding, whether oral or written shall be binding upon Seller, unless hereafter expressed in writing, approved and signed by an officer of Seller. Buyer shall not assign its rights or obligations under this Contract without the prior written consent of Seller, which consent may be withheld for any reason in the sole discretion of Seller. Any attempt at such assignment by Buyer without the prior written consent of Seller shall be deemed null and void. This Contract will be binding upon the parties hereto and their successors and permitted assigns. The provisions of Sections 2 through 5 and 7 through 14 shall survive the termination and performance of this Contract.