Terms & Conditions

1. Agreement. Subject to the terms and conditions set forth herein, that Innovative Paper Technologies, LLC issuing the applicable Quotation or Acknowledgement (as defined below) ("Seller") agrees to sell, and Purchaser agrees to purchase, goods, products and services, including any documentation with respect thereto, (collectively referred to as the "Products") as are identified on Seller's sales quotation ("Quotation") or sales acknowledgement ("Acknowledgement").

2. Binding Terms.

2.1. The terms and conditions set forth in this agreement ("Agreement") shall become binding on the parties upon the earlier of (i) Seller's issuance of its Acknowledgement or (ii) Seller's delivery of the Products, in whole or in part.

2.2. The terms of the sale of the Products are expressly limited to the terms and conditions set forth herein unless modified by the terms and conditions of the Quotation or Acknowledgement. Any and all terms set forth on Purchaser's purchase order or otherwise proposed by Purchaser are hereby objected to and shall be void unless expressly agreed to in writing signed by Seller. This Agreement contains the entire agreement of the parties and all proposals, negotiations, representations or agreements made or entered into prior to or contemporaneously herewith, whether oral or in writing, are expressly superseded.

3. Delivery; Title & Risk of Loss.

3.1. Delivery shall be made and title and risk of loss shall pass to Purchaser upon Seller placing the Products with a carrier FOB point of shipment regardless of whether or not Seller or Purchaser pays the cost of shipping. Delivery dates are approximate and are based upon prompt receipt of all necessary information from Purchaser. Receipt of the Products by Purchaser FOB point of shipment shall constitute Purchaser's acceptance for delivery and waiver of any and all claims against Seller for loss or damage incurred due to delay. Upon such delivery no damage, destruction or loss of the Products shall release Purchaser from its obligations and liabilities to Seller hereunder. No claims for errors in shipment will be considered unless made within 10 days after Purchaser's receipt of Products and unless accompanied by necessary papers or documents to substantiate the claim.

4. Limitation on Liability.

4.1. Seller shall not be liable or responsible for any indirect, proximate, special or consequential damages or contingent liabilities (collectively, "Special Damages") under any circumstances, including, but not limited to, loss of life, personal injury, loss of business income, downtime costs or trade or other commercial losses arising out of a defect in any of the Products, including, but not limited to, damage or loss resulting from Purchaser's inability to use the Products or Purchaser's (or its customer's) inability to use any equipment, or any increased operating costs or loss of production or costs incurred by Purchaser (or any customer of Purchaser) in removing, reinstating or repairing allegedly defective Products or delay damages or any other such damages, whether arising from causes similar to or dissimilar to those enumerated.

4.2. Notwithstanding any provision hereof which may be or appear to be to the contrary, in no event whatsoever shall Seller's liability in respect to any claim or action of any kind arising out of, in connection with, or resulting from the manufacture, sale, delivery, resale or use of the Products, or any breach by Seller of any term hereof, exceed the price for the Products which gives rise to such claim or action. Purchaser assumes all other liability for any loss, damage or injury to persons or property arising out of, connected with or resulting from the use of the Products, either alone or in combination with other Products, including, without limitation, any Special Damages or any loss, damage or injury to Purchaser (or to Purchaser's employees or property or to the employees or property of any customer of Purchaser) due to the acts or omissions of Purchaser, its agents, employees or customers, in the installation, use or operation of such Products.

5. Limited Warranty.

5.1. As its sole and exclusive warranty with respect to the Products, Seller warrants that, for the period ending on the earlier to occur of (i) fifteen (15) days after the date of discovery and (ii) sixty (60) days after the date of shipment, the Products sold hereunder that are manufactured by Seller are free from defects in material and workmanship under normal operating conditions and proper application.

5.2. THE FOREGOING WARRANTY IS EXPRESSLY IN LIEU OF ANY OTHER WARRANTIES EXPRESS OR IMPLIED, INCLUDING, BUT NOT LIMITED TO, THE IMPLIED WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE, NOTWITHSTANDING ANY DISCLOSURE TO SELLER OF THE INTENDED USE OF THE PRODUCTS.

5.3. The foregoing warranty does not cover any conditions over which Seller has no control, including, without limitation, abuse, neglect, accident, improper installation, misapplied use, failure to maintain, failure to use appropriate materials or supplies in connection with the Products, unsuitability or incompatibility of the Products with other products not supplied by Seller or any Products altered by anyone other than Seller's personnel.

5.4. Purchaser's sole and exclusive remedy under this limited warranty shall be limited to, at the option of Seller, (i) the exchange of warranted Products (FOB Seller's factory) or (ii) refund of the invoice value of such defective warranted Products.

5.5. No Products shall be returned without prior authorization from Seller. Purchaser shall prepay all transportation charges for the return of such Products to Seller's factory. Seller shall be responsible for reasonable transportation charges back to Purchaser for Products that have been replaced by Seller. All replacements provided under this warranty will assume the identity for warranty purposes, of the Products replaced and the warranty on such Products will expire when the warranty on the original part would have expired. Claims must be submitted within the earlier to occur of (i) fifteen (15) days after the date of discovery and (ii) sixty (60) days after the date of shipment or be subject to rejection. This warranty is not transferable beyond the first purchaser.

5.6. If the Purchaser grants to an end user any warranty that is greater in scope or time period than the warranty stated herein, Seller shall not be liable beyond this stated warranty. The term "Purchaser" as used herein means the person or firm that purchased the Products directly from Seller, and includes direct OEM customers and Seller's distributors.

6. Prices.

6.1. All prices are subject to change without notice and the prices hereunder shall be those in effect at the time of shipment. Prices exclude shipping costs, unless Seller otherwise agrees in writing, in which case delivered prices are subject to change in shipping charges. Prices are stated in United States Dollars and payment shall be made in United States currency.

6.2. Prices do not include sales, use, excise or any similar taxes or other governmental charges. Any tax or other governmental charge upon the production, sale, shipment, or use of the Products which Seller is required to pay or collect from Purchaser shall be paid by Purchaser to Seller unless Purchaser furnishes Seller with a tax exemption certificate acceptable to the applicable taxing authority. Purchaser shall be responsible for obtaining any and all necessary governmental clearances, including any import, export and/or foreign exchange license, which may be required by the federal, any state or any foreign government, or any subdivision or agency of any thereof. Any and all fees that are imposed by foreign, federal, state, municipal or other authorities incurred by Seller on behalf of Purchaser during the production, sale or shipment of Products shall be added to the price and must be paid by Purchaser.

7. Payment.

7.1. All amounts payable by Purchaser with respect to the Products are, unless otherwise indicated, due and payable 30 days from the date of invoice. Thereafter, the unpaid balance thereof shall bear interest at the rate of one and one-half percent (1.5%) per month until paid in full.

7.2. Invoices shall be dated as of the date of shipment. However, if, in the opinion of Seller, the financial responsibility of Purchaser becomes impaired or unsatisfactory prior to payment in full with respect to the amounts due hereunder, Purchaser shall, if required by Seller to do so, make cash payments or furnish satisfactory security before any further deliveries are made hereunder. Failure or refusal by Purchaser to comply with the requirements that Seller may impose upon Purchaser in accordance with the foregoing shall entitle Seller to suspend deliveries hereunder during such failure or refusal or, alternatively, to terminate this Agreement. Any such action by Seller shall not in any way prejudice Seller's claim for damages or Purchaser's obligations to pay for Products already delivered.

8. Uniform Commercial Code. Until the entire purchase price for the Products (as set forth in invoices or by other memoranda from time to time issued to Purchaser by Seller) has been fully paid, (all such obligations, liabilities and indebtedness of Purchaser to Seller being sometimes collectively referred to herein as "Liabilities"), Seller shall have, to secure payment of such Liabilities, a continuing senior purchase money security interest in the Products and proceeds therefrom. Purchaser shall, at its own cost and expense, perform all acts necessary to perfect and protect Seller's interest.

9. Transportation Charges and Allowances.

9.1. Unless otherwise agreed to by Seller in writing, all shipping arrangements with respect to the Products shall be made by Purchaser and the costs thereof borne by Purchaser.

9.2. If Seller includes the cost of shipping in the purchase price of the Products, then (i) Seller reserves the right to select (x) the method of shipment, (y) the delivery routing and (z) the carrier; (ii) any additional transportation costs incurred due to routing, method of shipment or other instructions requested by Purchaser will be added to the purchase price and paid by the Purchaser; (iii) any prepayment by Seller of shipping charges shall be for the account of Purchaser and shall be paid by Purchaser with the total purchase price for the Products; (iv) if requested by Purchaser, stop-overs are permissible when tariffs allow, provided that Purchaser shall pay any and all stop-over charges, including, without limitation, any shipping charges due to additional mileage incurred; and (v) if part shipment is made with Purchaser's approval, additional shipping charges arising therefrom, if any, will be billed to the Purchaser.

10. Force Majeure. Seller shall not be liable for any delay or failure in delivery or performance or damage to Products, due, directly or indirectly, to any cause beyond Seller's reasonable control, including, but not limited to, acts of God, fires, floods, epidemics, strikes or other labor disputes, accidents to machinery, acts of sabotage or terrorism, riots, wars, inability to obtain raw materials, components, fuel or supplies, precedence or priorities granted at the request or for the benefit, directly or indirectly, of the federal, any state or foreign government or any subdivision or agency thereof, delay in transportation or lack of transportation facilities, or any restrictions imposed by federal, state, foreign or other governmental legislation, rules, regulations or orders. In the event of any such delay or failure, this Agreement shall not terminate, but the date of delivery or performance shall be extended for a period equal to the time lost by reason of the delay or failure.

11. Cancellation. This Agreement may not be cancelled by Purchaser without the prior written consent of Seller, which consent may be granted or withheld in Seller's sole discretion. In the event of such cancellation, Purchaser shall be liable for Seller's anticipated profit and for all costs incurred prior to cancellation.

12. Compliance with Law. Seller represents that Products delivered or performed by Seller pursuant hereto will comply with the Fair Labor Standards Act of 1938, as amended.

13. Federal Contract Requirements. In the event this Agreement is subject to the following requirements related to federal contracts, Seller represents that its performance hereunder is in compliance with: (i) Executive Order 11246, including section 202; (ii) The Vietnam Era Veterans Readjustment Assistance Act of 1974; (iii) applicable worker's compensation requirements; and (iv) The Rehabilitation Act of 1973.

14. Indemnification; Intellectual Property.

14.1. Purchaser agrees to hold Seller harmless from any and all damages, costs and expenses relating to any claim arising from the design, manufacture or use of any Products made in accordance with drawings, samples or manufacturing specifications designated by Purchaser or arising from the combination or incorporation of any Products in a more comprehensive assembly than sold by Seller, or arising from a claim that such Products furnished to Purchaser by Seller, or the combination or incorporation or the use of any thereof, infringes upon any intellectual property rights, including, without limitation, Letters Patent or trade secrets, foreign or domestic, and Purchaser agrees at its own expense to undertake the defense of any suit against Seller brought upon such claim or claims.

14.2. In the event any Products manufactured by Seller are solely the design of Seller, Seller agrees (subject to the last sentence of this Section) to hold harmless Purchaser against damage awarded by a court of final jurisdiction in any suit or suits for the infringement of any intellectual property rights or the violation of any trade secrets by reason of the sale or use of such Products. Notwithstanding the foregoing, any obligation on Seller's part to indemnify Purchaser under this Section 14.2 shall be limited solely in amount as provided for in Section 4.2 above.

14.3. Purchaser agrees to notify Seller as soon as practicable of any charge or suit alleging any such infringement or violation, and agrees that the foregoing agreement to indemnify by Seller shall not apply unless Seller shall have been so notified and given the opportunity to take over the defense thereof, and further, such agreement to indemnify shall not apply if (i) the claimed infringement is settled without the consent of Seller unless required by a final unappealable decree of a court of competent jurisdiction, or (ii) the infringement or violation results from the use of any such Products in combination with a product not manufactured by Seller where such infringement or violation would not have occurred from the use of the Products alone.

14.4. Seller grants no license hereunder, express or implied, other than the right of Purchaser to use the Products.

15. Return Authorization. Except as set forth in Section 5.5 or in this Section, Purchaser may not return any shipped Products. Purchaser may, with the prior written consent of Seller (which consent may be granted or denied in Seller's sole and absolute discretion) and in conformity with shipping instructions provided by Seller, return Products delivered to Purchaser and with respect to which Purchaser has not paid to Seller the full purchase price thereof, that are free from any damage whatsoever and in fair saleable condition; provided, however, that (i) with respect to any of Seller's standard products, Purchaser agrees to pay to Seller a restocking charge equal to twenty-five percent (25%) of the purchase price of such Products together with any transportation, taxes and/or rework charges incurred by Seller in connection with the return of such Products and (ii) with respect to any of Seller's non-standard Products, such fees, charges and expenses as Seller shall determine in its discretion..

16. Proprietary Rights.

16.1. All information of every kind and nature (except for such information as may be established to be in the public domain or which, subject to Section 16.2 below, Purchaser may establish to be the property of Purchaser) related to the design, engineering, production, process, method, device, technique, formulas, plans, diagrams, drawings, compilations, patterns, tools, dies, or fixtures in connection with or related to any Product, are proprietary in favor of Seller. Such information has been developed at great expense to Seller and may contain trade secrets of Seller. Purchaser shall not reproduce, disclose, distribute or utilize same without Seller's prior express written consent (which consent may be granted or denied in Seller's sole discretion) or as required by judicial or governmental action and Purchaser shall exercise reasonable care to hold such information in confidence.

16.2. Any information, suggestions or ideas transmitted by Purchaser to Seller in connection with performance hereunder are not to be regarded as proprietary or confidential unless expressly provided in a writing signed by Seller.

17. Default.

17.1. The occurrence of any of the following events shall constitute Purchaser's default under this Agreement: (i) Purchaser's failure to make timely payment of any sum owing to Seller under this Agreement; (ii) institution of any proceedings by or against Purchaser under any bankruptcy, insolvency or similar law; (iii) appointment or application for a receiver for Purchaser; (iv) an assignment by Purchaser for the benefit of creditors; (v) failure of Purchaser to furnish Seller, upon Seller's request, with a written representation reaffirming Purchaser's solvency (it being understood that this Agreement constitutes a representation by Purchaser that it is solvent); or (vi) Seller deems itself insecure with respect to performance by Purchaser hereunder.

17.2. Upon Purchaser's default hereunder, Seller may, upon written notice to Purchaser, cancel Seller's obligations under this Agreement, in which case, at Seller's option:

(i) Purchaser shall pay for all Products delivered and for all Products completed or in process pursuant to this Agreement;

(ii) With respect to any unit of Products for which Seller has not received full payment, Seller may stop delivery, retake (or retain) possession of such units of Products wherever located (all without notice, demand or legal process) and retain, lease or resell (at public or private auction or otherwise) such units of Products without accounting to Purchaser and any payments received by Seller from Purchaser of less than full payment for any such units of Products may be retained as liquidated damages;

(iii) Seller may declare any outstanding balance immediately due and owing and collect same from Purchaser without further notice or demand, together with interest at the maximum rate permitted by law; and/or

(iv) Refuse to deliver any Products except on a cash basis.

17.3. In the event of a default by Purchaser as described in Section 17.1 above, and at any time or times thereafter, Seller may declare all Liabilities secured hereby to be immediately due and payable and shall have and may exercise all the remedies of a secured party under the Uniform Commercial Code and other applicable state and federal law as in effect from time to time. The commencement of any action, at law or in equity, or the rendering of any judgment or decree for any deficiency, shall not affect Seller's security interest in the Products or proceeds thereof, until the Liabilities hereunder or any judgment therefor are fully paid and satisfied.
18. Miscellaneous.

18.1. Seller shall be an independent contractor of Purchaser in the performance of this Agreement. Neither party hereto, nor any respective agent of either party, shall be regarded as an agent or employee of the other. This Agreement shall not be construed to be a joint venture between the parties.

18.2. No waiver by Seller of any default shall be deemed a waiver of any subsequent default unless the same shall be signed in writing by Seller.

18.3. If any provision of this Agreement is held to be invalid under applicable law, such invalidity shall not affect the remaining provisions of this Agreement.

18.4. The provisions of this Agreement shall be binding upon and inure to the benefit of the respective representatives, successors and assigns of the parties hereto, including, without limitation, a debtor-in-possession; provided, however, that no interest herein may be assigned by Purchaser without the prior written consent of Seller.

18.5. No waiver, alteration or modification of the terms and conditions hereof shall be valid or binding upon Seller unless made in writing and signed by Seller.

18.6. This Agreement shall be governed by the laws of the State of New Hampshire.