Contract Packaging Agreement between ( PACKAGER ) and ( CUSTOMER ) Januarry 2011 WHEREAS, CUSTOMER desires to engage the facilities and services of PACKAGER for the packaging of certain products to be sold by CUSTOMER and WHEREAS, PACKAGER desires to undertake such packaging, according to the terms and conditions set forth below; and PACKAGER AND CUSTOMER HEREBY AGREE, EFFECTIVE BEGINNING UPON THE DATE OF SIGNATURE OF THE SECOND PARTY TO SIGN BELOW, THAT: Definitions The following definitions shall apply to the terms defined as used in this Agreement: PACKAGER shall refer to with its principal place of business at. CUSTOMER shall refer to with its principal place of business at. PACKAGING SERVICES provided under this Agreement by PACKAGER to CUSTOMER shall refer to the services more fully described in Exhibit A, which may or may not include creation of finished packaging articles, or filled packaging articles, or changing the form of packaged goods, or palletizing, specification, sourcing and/or purchasing of component ingredients, MATERIALS or labels. MATERIALS shall mean the packaging materials, ingredients, labeling, or components or related materials obtained by or provided to PACKAGER for the purpose of performing PACKAGER s obligations under this Agreement. 1. PACKAGING SERVICES PACKAGER agrees to provide the PACKAGING SERVICES described in Exhibit A attached hereto ( Products ). 2. PRICE In consideration for the PACKAGER s performance, CUSTOMER agrees to pay the sums set forth in Exhibit B on the terms set forth in Exhibit B. 1
3. MATERIALS AND SUPPLIES 3.1 Responsibility for conformance: If and to the extent CUSTOMER obtains or provides the MATERIALS, CUSTOMER shall be solely responsible for assuring their conformance to specifications set forth in this Agreement in Exhibit A. If and to the extent PACKAGER obtains or provides the MATERIALS, PACKAGER shall be solely responsible for assuring their conformance to specifications set forth in this Agreement in Exhibit A. 3.2 Disposition upon completion: Upon completion of work requested by CUSTOMER, PACKAGER agrees to promptly return, at CUSTOMER s shipping cost, all CUSTOMER s finished products, work in process, and raw materials upon receipt of the payments agreed to under this Agreement. If CUSTOMER fails or refuses to pay for or arrange shipping of any of its products, formulas or raw materials after thirty (30) days after termination, PACKAGER may, at its sole discretion, (1) destroy them and charge any reasonable costs of doing so to CUSTOMER; or (2) use them for any other purpose not related to this Agreement, provided no intellectual property or confidentiality obligations would be violated by doing so. PACKAGER shall not use as collateral for any loan or guarantee any products or MATERIALS owned, purchased or held by CUSTOMER. 4. DELIVERY 4.1 Scheduling. PACKAGER shall schedule the timely shipment of the finished products pursuant to the agreed schedule as set forth in Exhibit A attached hereto. 4.2 Delivery. Delivery shall be F.O.B. destination, freight collect. CUSTOMER shall arrange Common Carrier transportation of the Products to CUSTOMER s specified plant or other destination. PACKAGER s invoice shall be accompanied by commercial bills of lading. 5. SPECIFICATIONS AND QUALITY CONTROL 5.1 Specifications. PACKAGER shall manufacture the Products in accordance with the formula and specifications set forth in Exhibit A, attached hereto. 5.2 Quality Control Procedures. PACKAGER shall maintain a satisfactory quality control program (including necessary equipment) consistent with any and all applicable legal standards and requirements, including, if applicable, Current Good Manufacturing Practices (cgmps) for foods, drugs, medical devices, cosmetics, animal foods or animal drugs. PACKAGER shall assure that all Products supplied hereunder shall be manufactured in accordance with applicable federal or state laws regulations in effect at the time of manufacture, and PACKAGER reserves the right to suspend or delay its performance under this Agreement if necessary to assure continued compliance with such requirements. PACKAGER agrees to notify CUSTOMER promptly upon learning of any failure or suspected failure of any batch of Products to meet Product Specifications or other applicable standards. 2
6. WARRANTIES AND INDEMNITIES 6.1 Warranties as to specifications. To the extent that CUSTOMER chooses MATERIALS and supplies to be used for the Project, CUSTOMER hereby warrants and represents that they will be of quality and character suitable for completion of the Project as set forth in this Agreement, and that CUSTOMER is solely responsible for assuring that the MATERIALS and supplies are of such suitable quality and character. To the extent that PACKAGER chooses or acquires MATERIALS and supplies to be used for the Project after being provided with technical specifications for such MATERIALS and supplies by CUSTOMER or its designee, PACKAGER warrants only that the MATERIALS and supplies it chooses or acquires will meet the specifications requested by the CUSTOMER, and hereby disclaims any further warranty or assurance of the suitability of the MATERIALS or supplies for the Project. To the extent that PACKAGER chooses MATERIALS and supplies to be used for the Project, PACKAGER hereby warrants and represents that the MATERIALS and supplies that it chooses will be of quality and character suitable for completion of the Project as set forth in this Agreement, and that PACKAGER is solely responsible for assuring that the MATERIALS and supplies are of such suitable quality and character. 6.2 PACKAGER S Warranty. PACKAGER warrants that all articles it provides to CUSTOMER pursuant to this Agreement shall be, at the time of delivery, in compliance with all applicable federal, state and local laws, including, but not limited to, if applicable, the Federal Food, Drug and Cosmetic Act and the regulations in Title 21 of the US Code of Federal Regulations. If so applicable, PACKAGER warrants that the Products are not adulterated within the meaning of the Federal Food, Drug and Cosmetic Act, and are not articles which, under said Act, may not be introduced into interstate commerce. 6.3 CUSTOMER s Indemnity. CUSTOMER agrees to indemnify, and hold PACKAGER harmless from and against any and all liabilities, costs, losses, judgments (including attorney s fees) caused by or arising out of (1) CUSTOMER s formulation for the Products, if supplied by CUSTOMER and manufactured in accordance therewith), (2) contents of labels specified by CUSTOMER, if provided by CUSTOMER and created and applied in accordance with CUSTOMER s instructions, or advertising or other statements of CUSTOMER or its agents regarding the product; or (3) CUSTOMER s failure to comply with its obligations under this Agreement. 6.4 Trademark Indemnity. CUSTOMER agrees to indemnify and hold PACKAGER harmless against all claims that any trademark appearing on the labels or packaging materials specified or provided by CUSTOMER infringes the trademark or copyright rights of others. PACKAGER hereby acknowledges that it does not have, and shall not acquire, any interest in any of the CUSTOMER s trademarks or trade names or copyrighted material appearing in the labels or packaging materials for the Products. 6.5 Notice. Each party agrees to give the other prompt written notice of any claims, including any claims asserted or made by any governmental authority for which the other might be liable under the foregoing indemnifications, together with information necessary to defend, negotiate and settle such claims. Neither party shall be bound by a compromise or settlement made without its prior written consent. 3
7. LIMITATION ON DAMAGES CUSTOMER hereby acknowledges and agrees that PACKAGER s liability for any breach of performance or of warranty will not exceed the price actually paid by CUSTOMER under this Agreement and CUSTOMER hereby waives and releases any and all claims against PACKAGER in excess of such price, and that in the event of any breach of performance or any warranty under this Agreement by or attributable to PACKAGER, PACKAGER shall in no instance be liable to CUSTOMER for any special, incidental, exemplary, indirect, or consequential damages, including but not limited to, lost sales, revenues or profit, loss or return of or damage to product or MATERIALS, diminution in value of trademark or other intellectual property, loss of prospective economic advantage, loss of facilities, inventory, work-in-process, or time and materials, and CUSTOMER hereby waives and releases any such claims. 8. INSURANCE 8.1 Packager. PACKAGER shall carry and keep in force throughout the term of this Agreement insurance coverage sufficient to cover ingredients, MATERIALS, equipment and finished products of CUSTOMER in possession of PACKAGER for the benefit of CUSTOMER. PACKAGER shall further carry and keep in force throughout the term of this Agreement insurance coverage sufficient to cover products owned, purchased, or ordered by CUSTOMER which are in the possession of PACKAGER. 8.2 Customer. CUSTOMER shall carry and keep in force throughout the term of this Agreement insurance coverage sufficient to support its obligations and potential liabilities under this Agreement. 9. CONFIDENTIALITY All information, knowledge, technology and trade secrets (collectively information ) of CUSTOMER relating to the production, processing and testing of Products shall be used by PACKAGER only in the performance of its obligations under this Agreement. PACKAGER shall establish and maintain procedures to insure that all information disclosed to its employees is done so only on a need to know basis and is maintained in confidence and not disclosed to third parties or the public. PACKAGER shall not use such information for itself or for any third party. 10. TERMINATION 10.1 Termination. PACKAGER shall have the right to terminate this Agreement immediately and cease all work upon failure of CUSTOMER to make payments as agreed in Exhibit B, and PACKAGER shall have no liability under any circumstances for breaches or failures resulting from failures of CUSTOMER to meet any other obligations. CUSTOMER shall have the right to terminate this Agreement in whole or in part, immediately upon written notice to PACKAGER, if CUSTOMER provides PACKAGER with notice that it believes PACKAGER has materially failed to deliver Products in conformity with the specifications set out in Exhibit A and if PACKAGER is unable to remedy such alleged failure within thirty (30) days. Either party shall have the right to terminate this Agreement if the other party files a petition in bankruptcy or enters into an arrangement with its creditors or applies for or consents to the appointment of a 4
receiver or trustee or makes an assignment for this benefit of creditors, or suffers or permits the entry of an order adjudicating it to be bankrupts or insolvent. 10.2 Obligations upon Termination. In the event of termination pursuant to Paragraph 10.1, CUSTOMER shall, within ten (10) days of termination, pay for (1) finished products created by MANUFACTURER under this Agreement, (2) all unpaid MATERIALS and supplies purchased by PACKAGER necessary for the PACKAGER s performance under this Agreement. Upon termination, PACKAGER agrees to promptly return, at CUSTOMER s shipping cost, all CSUTOMER s finished products, work in process, and raw materials upon receipt of the payments described in this paragraph. If CUSTOMER fails or refuses to pay for or arrange shipping of any of its finished products, work in process, and raw materials after thirty (30) days after termination, PACKAGER may destroy them. 11. GENERAL 11.1 No Waiver. The failure of either party to terminate this Agreement by reason of the breach of any of its provisions by the other party, or the failure to exercise any other rights or remedies under this Agreement, shall not be construed as a waiver of the rights or remedies available for any subsequent breach of the terms and provisions of this Agreement. 11.2 Notices. Any notice required or permitted under this Agreement shall be deemed to have been received within two business days after written notice is sent by certified or registered mail, return receipt requested and postage prepaid, in the United States mail addressed to the respective parties as set forth below or to such address as each party may hereafter designate by written notice to the other party as set forth below, and on the next business day after written notice is sent by facsimile transmission to the respective parties at the facsimile numbers set forth below, or to such address or facsimile number as each party may hereafter designate by written notice to the other party in accordance with this Section. 11.3 Records. PACKAGER shall maintain good and sufficient records with respect to its inventories, obligations and performances under this Agreement. All such records shall be retained by PACKAGER for a period of not less than two years or such longer periods as required by law or regulation. 11.4. Force Majeure. Each of the parties shall be excused from any act, omission or obligation to perform hereunder or any liability related thereto when such failure or default is caused by Act of God, ware, fire, explosion, flood, hurricane, strike, lockout, injunction, inability to obtain fuel, power, raw materials, packaging or shipping materials, containers, labor or delays or defaults caused by public carriers, national defense requirements government injunction or other causes beyond its reasonable control or caused by the other party, provided that the party affected by the event of force majeure uses its best efforts to alleviate the effects of such event as promptly as reasonably practicable under the circumstances. 11.5 Complete Agreement. This Agreement, including the Exhibits attached hereto, sets forth the entire Agreement between the parties relative to the subject matter herein. No course of dealing or usage of trade or course of performance may be used to supplement or explain the terms of this Agreement or the obligation and rights of the parties hereto, and parol or extrinsic evidence unless in writing signed by both parties hereto is inadmissible to explain, vary or contradict the express terms of this Agreement. 5
11.6 Modification of Agreement. This Agreement cannot be modified except by a writing signed by both parties hereto. 11.7 Relationship of Parties. PACKAGER shall at all times act as an independent contractor, and nothing contained herein shall be construed to create a partnership, joint venture or agency relationship, and neither party shall have any authority, expressed, implied or apparent, to assume or create any obligations on behalf of or in the name of the other party. 11.8 Waiver. The failure to assert any right or remedy available to a party under the terms of this Agreement shall not be deemed to be a waiver of such right or remedy, and the waiver of any right or remedy available under this Agreement shall not constitute a waiver of any other right or remedy. 11.9 Severability. The provisions of this Agreement shall be severable and the invalidity of any provision, or portion thereof, shall not affect the enforceability of the remaining provisions of this Agreement. 11.10 Assignment. Neither party hereto may assign any of its rights under this agreement, in whole or in part, without the prior written consent of the other party, which consent will not be unreasonably withheld. Subject to the foregoing, this Agreement shall inure to the benefit of and shall bind each of the parties hereto and their respective successors and assigns. 11.11 Governing Law. The parties herein agree that in the event of any dispute or disagreement between them relating to this Agreement, the law of the State of PACKAGER s principal place of business shall apply. IN WITNESS WHEREOF, authorized representatives the parties hereto have executed this Agreement on the date or dates indicated below: PACKAGER By: Date: Title: Address: Tel: FAX: EMAIL: CUSTOMER By: Date: Title: Address: Tel: FAX: EMAIL: 6
EXHIBIT A PACKAGING SERVICES Description of PACKAGING SERVICES to be provided by PACKAGER for CUSTOMER under the foregoing Agreement, including - materials and finished product specifications, - provisions for sample review and approval before or during production - completion dates, milestones - delivery schedule, manner 7
EXHIBIT B PRICING and PAYMENT Pricing terms for finished goods, INCLUDING possibly - payment terms/schedule - assessorial sheet for -extras, - changes, - incomplete performance - storage - disposal 8