Master Services Terms

These MASTER SERVICES TERMS (the “Terms”) are incorporated by reference into each Statement of Work (as further described herein), by and between Valley Fulfillment LLC, an Arizona LLC (the “Company”) and the counterparty to each Statement of Work (the “Customer”).

Recitals

1. WHEREAS, Company provides fulfillment, warehousing, and shipping services using proprietary software created, owned, operated, and/or licensed by Company;
2. WHEREAS, Customer has the need for one or more of the services provided by Company, including providing Customer products to Company to be stored, packaged, branded, labeled, and/shipped by Company to end-users on behalf of Customer (the “Products”);
3. WHEREAS, Company and Customer desire to enter into these Terms as the underlying terms and conditions, which control and apply to individual Statements of Work (individually a “SOW” and collectively the “SOW’s”), under which Customer will obtain services from Company; and
4. WHEREAS, the services to be provided by Company to Customer shall be set forth in individual SOW’s, and the terms and conditions of these Terms shall be incorporated into and made a part of each SOW (the “Services”).

NOW THEREFORE, in consideration of these Recitals and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, Customer and Company agree as follows:

Agreement

1. Term and Termination.
   1. Term.
      These Terms shall become effective upon the Effective Date of the first SOW between Company and Customer, and shall continue in full force and effect until terminated in accordance with the provisions of these Terms. The term of each SOW shall be as stated in the SOW. The terms, conditions, and obligations contained in these Terms shall apply to all SOW’s between the Company and Customer, which terms may be updated from time to time. Customer is responsible for reviewing the Company website for the most current version of these Terms prior to entering into each SOW. Each SOW will be governed by the Terms in effect as of the Effective Date of such SOW.
   2. Termination.
      • Either party may terminate these Terms without cause, provided that such termination shall not take effect until after the date that all SOW’s signed by the parties have expired or been terminated, by providing the other party with 60 days written notice of such termination.
      • Either party may terminate any SOW under these Terms if the other party: (i) commits a breach of any material and substantive provision of such SOW and such breach continues for a period of thirty (30) days following written notice from the non-breaching party, or (ii) as to such breaches which cannot be cured within said thirty (30) day period, the breaching party fails to initiate a cure within said thirty (30) day period and/or fails to diligently prosecute the cure to conclusion. A party’s right to terminate a SOW, under this Section 1.2(b) for uncured breach, must be exercised by providing the breaching party with written notice of termination within thirty (30) days after the end of the applicable cure period or is waived as to such breach.
      • Either party may terminate these Terms and all SOW’s, effective immediately, if the other party: (i) fails to pay invoices, files, or has filed against it, a petition for voluntary or involuntary bankruptcy or pursuant to any other insolvency law, or (ii) makes or seeks to make a general assignment for the benefit of its creditors or applies for or consents to the appointment of a trustee, receiver or custodian for its or a substantial part of its property.
      • Upon any termination/expiry, Company provides exit assistance (inventory counts, data exports, palletization) at SOW rates.
2. Services.
   1. Services.
      Company shall provide Customer with the Services set forth in each SOW signed by the parties and made a part of these Terms. Each SOW shall set forth all Services related to the Products and the rates and charges for such Services (the “Rates”), and any special requirements relating to the Services, the Products, and/or the Rates. If Products need to be delivered or sent to the Facility (as defined below), the terms, including without limitation the delivery date, carrier, transportation costs, storage costs, and other information shall be contained in the applicable SOW.
   2. Company’s Facility.
      Company shall provide the Services at Company’s facility located at 8957 W. Windsor Dr., Suite 116, Peoria, AZ 85381, and/or any other facility designated by the Company, so long as written notice is provided to the Customer if the location of the Services changes during the term of a SOW (the “Facility”). Relocation will not degrade Service Levels or increase costs; facilities remain within Arizona unless otherwise agreed.
   3. Price and Payment Terms.
      All Rates are set forth in the applicable SOW. The rates and charges for any additional Services and/or materials (“Additional Services”) shall be quoted upon request of such Additional Services. Customer agrees to pay Company in accordance with the payment terms set forth in the applicable SOW. Customer must notify Company of any disputes relating to any invoice or portion thereof within fifteen (15) days of receipt of the invoice or will have waived said dispute. All undisputed invoices and portions thereof not paid within five (5) business days after receipt by Customer shall be assessed interest at the rate of five percent (5%) per month on the unpaid balance until paid.
   4. Annual Rate Adjustment.
      All Rates set forth in each SOW shall be maintained without change for the first twelve-month period following the effective date of the applicable SOW (the “Annual Period”) and shall remain in effect until modified by Company. In the absence of specific notice of revised effective Rates, the Company may unilaterally increase Rates by no more than five percent (5%) per line item on an annual basis with 30 days written notice. Rate changes will also occur if the Customer’s volumes, inventory, and supply chain needs are not as described by Customer prior to onboarding and prior to execution of the SOW. Mid-term adjustments require a documented ≥15% variance from SOW baselines. Shipping rates can fluctuate, based on carrier changes, global circumstances, or unforeseen industry events.
   5. Ownership of Products.
      Customer shall be and remain the owner of the Products at all times that the Products are in the custody of Company.
3. Facility Operation.
   1. Facility Hours.
      Unless otherwise agreed by the parties in a SOW, Company’s normal business hours at the Facility are Monday through Friday, except holidays, from 9:00am to 5:00pm. Company and Customer agree to separately address increased hours and capacity to accommodate increased volume during certain holidays, and those separate terms and conditions shall be negotiated in good faith as part of a separate SOW.
   2. Storage Conditions.
      At all times that the Products are in the custody of Company, Company shall maintain the areas of the Facility where the Products are stored at ambient temperature and humidity levels. Company does not warrant or guarantee that any specific requirements related to the Products (such as a specific temperature or humidity level) will be maintained, and if any such requirements apply, Customer shall notify Company of such requirements in writing prior to execution of any SOW, provided, however, that Company is under no obligation to meet such requirements and Customer providing any Products to Company despite any specified requirements shall be at Customer’s sole risk. In no event shall Company be responsible for loss or damage to Products due to a failure or fluctuation of such storage conditions or non-compliance with Customer requirements for any Products.
4. Standard of Care and Limitations.
   1. Damaged Products Received at the Facility.
      Company shall take reasonable efforts to segregate all inbound Products listed as “damaged” on the Company receipt and keep such damaged Products segregated and identified according to each inbound receiving report. Company will dispose of said damaged Products only in accordance with the Customer’s instructions.
   2. Standard of Care.
      Company shall not be liable for any loss and/or destruction of and/or damage to Products unless such loss, destruction and/or damage resulted from Company’s failure to exercise such care regarding the Products as a reasonably careful person would exercise under like circumstances. Company shall not be liable for any loss, and/or destruction of or damage to Products that could not have been avoided by the exercise of such care. Nothing in these Terms shall require Company to exercise a standard of care higher than reasonable care but Company will respond to Customer, in good faith and as reasonable, to document and explain the cause of loss, destruction, and/or damage. Without limiting the foregoing, Company represents it maintains a minimum 99% accuracy rate related to packaging and shipping. Company will only be liable to losses and/or damages to Customer that result from order errors exceeding this threshold, calculated on a monthly basis.
   3. Products Not Insured by Company.
      Products are not insured by Company against loss or injury, however caused. Customer shall obtain insurance in amounts sufficient to cover a total loss of the Products, however caused, and maintain such insurance in effect for the duration of time the Products are in Company’s possession, and list Company on such insurance policies as an additional insured. Prior to Company accepting possession of the Products, Customer must provide a certificate of insurance in compliance with the requirements of these Terms.
   4. Limitation of Liability.
      In the event of any loss or destruction of or damage to Products for which Company is liable under these Terms that exceeds the Loss Allowance set forth in the SOW related to such Products, Customer agrees that Company’s liability shall be limited to the actual cost to Customer to replace the lost item(s), excluding profit or mark-up.
   5. Notice of Claim and Filing of Suit.
      • Claims by Customer and any third parties must be presented in writing to Company within 90 days after Customer learned that, or in the exercise of reasonable care should have learned that, any part of the Products were lost, damaged or destroyed.
      • No lawsuit or other action may be maintained by the Customer or others against Company for loss or destruction of or damage to the Products unless timely written claim has been given as provided in paragraph (a) of this Section, and unless such lawsuit or other action is commenced within one (1) year after Customer learned or in the exercise of reasonable care should have learned that any part of the Products were lost, damaged or destroyed.
   6. Liability for Consequential Damages.
      Company shall not be liable for any loss of profit or other special, indirect, or consequential damages of any kind or description whatsoever.
   7. Liability for Mis-shipment.
      If Company negligently mis-ships Products, Company shall pay the reasonable transportation charges incurred to return the mis-shipped Products to the Facility. If the end user to whom Company mis-shipped the Products fails to return the Products, Company’s maximum liability shall be the landed cost value for the lost, damaged and/or destroyed Products as specified in Section 4.5 above, and Company shall have no liability for any damages due to the end user’s acceptance or use of the Products whether such Products be those of Customer or another customer of Company.
   8. Chargebacks.
      Company will only be responsible for chargebacks claimed by Customer’s end users in the event such chargeback is solely attributable to Company’s failure to exercise reasonable care in performing the Services or its breach of these Terms or the applicable SOW, provided that the Customer’s end users’ requirements had been provided to Company in writing by Customer prior to Company conducting the Services, and that Company had been advised, in writing, of all changes to such requirements, and further provided that Company shall only be responsible for chargebacks that exceed the Chargeback Allowance set forth in the applicable SOW. Customer will promptly provide Company with written notice of the chargeback and all documentation supporting the chargeback, and will use its best efforts to mitigate the amount of the chargeback. Company shall have thirty (30) days to research the chargeback before any payment is required of Company.
5. Performance Standards; Experience and Personnel.
   Company represents that it possesses the requisite skill, experience, knowledge, personnel, and facilities necessary to perform the Services and fulfill its other obligations under these Terms and each SOW. To Company’s knowledge, Company further possesses and is in compliance with all necessary licenses, permits and approvals required to execute, deliver and perform its obligations under these Terms and each SOW.
6. Insurance and Indemnification.
   1. Company Insurance.
      At all times during the term of these Terms and each SOW, Company shall procure and maintain insurance in types and amounts necessary and commercially reasonable to protect Company and Customer under the Services and SOW’s including Commercial General Liability ($2M aggregate), and Employer’s Liability. For the avoidance of doubt, in no event will Company be required to or responsible for maintaining insurance that protects or extends to the Products, which shall be the sole responsibility of Customer.
   2. Customer Insurance.
      At all times during the term of these Terms, in addition to the requirements set forth in Section 4.3, Customer shall procure and maintain all risk property insurance for the full replacement value of the Products. Customer shall also procure and maintain the following insurance to the extent that its employees will enter into or on the Facility (a) workers’ compensation insurance in the amount required by statute covering all its employees who will enter the Facility, (b) comprehensive general liability insurance with a minimum liability coverage of Two Million Dollars ($2,000,000) per occurrence and in the aggregate and (c) employer’s liability insurance for personal injury and property damage with a minimum liability coverage of Five Hundred Thousand Dollars ($500,000) per occurrence and in the aggregate.
   3. Indemnification.
      • Customer shall indemnify, defend and hold Company harmless, to the maximum extent permitted by law, from and against any and all claims, losses, damages, costs, expenses and other liabilities, including without limitation, reasonable attorney’s fees (collectively, “Losses”), asserted against Company by and/or on behalf of any third party arising out of or relating to (i) except as caused directly by Company’s gross negligence, any actual or alleged personal injury (including death) and/or property damage caused by the Products or Services under these Terms and any applicable SOW, (ii) non-fulfillment or breach by Customer of any agreement or covenant under these Terms, (iii) the inaccuracy or breach of any warranty or representation made by Customer under these Terms, (iv) any claims by end users or other third-parties related to the Products or their use thereof, and (v) any damage to the Facility or other products, equipment, or inventory stored by Company caused by the Products.
      • Company shall indemnify, defend and hold Customer harmless, to the maximum extent permitted by law, from and against any and all Losses asserted against Customer by and/or on behalf of any third party arising out of or relating to (i) actual or alleged personal injury (including death) and/or property damage (other than to the Products) to the extent caused in whole or in part by Company’s gross negligence, (ii) non-fulfillment or breach by Company of any agreement or covenant under these Terms, or (iii) the inaccuracy or breach of any warranty or representation made by Company under these Terms.
7. Confidentiality.
   1. Confidential Information.
      The parties acknowledge that in the course of performing their respective obligations hereunder, each party will come into possession of confidential information of the other including, but not limited to, price and cost data relating to the Products and Services, marketing plans, projections, distribution, and logistics information, and coding and other information related to the software used and owned by Company (collectively, “Confidential Information”).
   2. Ownership; Disclosure.
      Confidential Information of the disclosing party coming into possession of the receiving party shall remain the sole and exclusive property of the disclosing party. The receiving party shall use reasonable care, but in no event less care than such party uses to safeguard and protect its own Confidential Information, to protect the Confidential Information of the disclosing party, and the receiving party shall not use such Confidential Information for any purpose other than the discharge of its obligations under these Terms. Each party may make available the Confidential Information of the other party to those of its and its affiliates’ officers, directors, employees, agents, attorneys, accountants, insurers, insurance professionals and representatives (each a “Representative”) only on a “need to know” basis. Representatives shall be advised of their obligation to abide by the confidentiality obligations set forth herein and the receiving party shall be responsible for a breach by any of its Representatives. Neither party shall divulge the Confidential Information of the other to any other third party without the prior written consent of the disclosing party, except as the receiving party is specifically required by any governmental entity lawfully requesting the same, under compulsion of civil or criminal process or to any court of competent jurisdiction acting pursuant to its powers and then only after notice has been given to the disclosing party as early as reasonably possible so that the disclosing party can attempt to object to such disclosure. Each party implements commercially reasonable administrative, physical, and technical safeguards; security incidents are noticed within 72 hours. Trade secrets remain protected so long as they qualify as trade secrets.
   3. Exceptions to Confidential Information.
      Information disclosed hereunder shall not be considered Confidential Information to the extent it is (a) previously known by the receiving party prior to the disclosure thereof, (b) hereafter becomes, other than through the fault of the receiving party, generally available to the public, (c) disclosed to the receiving party by a third party other than in breach of an obligation of confidentiality owed by such third party to the disclosing party, or (d) independently developed by the receiving party without using Confidential Information as shown by the receiving party’s written records.
   4. Duration.
      Upon the termination of these Terms, unless otherwise required by applicable laws, rules or regulations, each party shall return to the other all Confidential Information of the other within its possession or control, and not thereafter use such Confidential Information in the promotion of its own business or the business of any third party, or otherwise make use of or refer to any Confidential Information or the identity of the other party. The obligations of confidentiality set forth herein shall remain in effect for five (5) years after the termination of these Terms.
   5. Photo and Video Release.
      Without limiting the foregoing, Customer acknowledges and agrees that Company may from time-to-time film content at the Facility for its own use, promotion, and marketing, which may include Customer’s likeness, branding, packaging, and other related visual information. Such content will not include any personal information of Customer and/or end users, such as names and addresses. By entering into these Terms, Customer waives any rights to such content, even if Customer’s Products are included in such content. Customer may repost Company-published content featuring Customer. Customers also waives any right to any profits derived from the same.
8. Miscellaneous.
   1. Notices.
      Any notice and other communication shall be in writing and shall be transmitted in one or more of the following methods and shall be deemed to have been given (a) on the date of delivery if delivered personally, (b) on the business day after dispatch if sent by documented overnight delivery service, (c) on the date of transmission if sent by facsimile or electronic transmission, provided that a confirmation copy thereof is sent no later than the next business day by a documented overnight delivery service or certified mail, postage prepaid, return receipt requested, or (d) on the fifth (5th) day following deposit in the United States mail if sent by certified mail, postage prepaid, return receipt requested and shall be directed to the addresses set forth on the applicable SOW. Either party may change the persons required to receive notices or other communications hereunder or their addresses by sending notices of such change to the other party in accordance with this Section 8.1.
   2. Entire Agreement; Amendment; Waiver.
      These Terms, including the Customer Payment Authorization & Payment Terms, and all applicable SOW’s, constitute the entire understanding between the parties with respect to the subject matter hereof and supersede all other understandings and negotiations with respect thereto. Any provision of these Terms, the Customer Payment Authorization & Payment Terms, or any SOW may be waived only by a writing signed by the party to be charged by such waiver. No course of dealing between the parties shall be effective to amend or waive any provision of these Terms. The most recent version of these Terms in effect at the time of signing each and any SOW shall govern that certain SOW, unless otherwise agreed in writing. These Terms may be amended by the Company from time to time by providing amended terms in the same location as these Terms or as otherwise set forth on the SOW’s. In the event of any conflict between any provision of these Terms, the Customer Payment Authorization & Payment Terms, and any SOW, specific provisions shall control over general provisions and the conflicting provision of the applicable SOW shall control.
   3. Severability.
      In the event that any provision of these Terms and/or any SOW shall for any reason be held to be invalid, illegal or unenforceable in any jurisdiction, such provision shall be ineffective as to such jurisdiction to the extent of invalidity, illegality or unenforceability without invalidating or affecting the remaining provisions hereof or affecting the validity, legality or enforceability of such provisions in any other jurisdiction.
   4. Assignment.
      Neither these Terms nor any SOW may be assigned in whole or in part by either party without the prior written consent of the other, which shall not be unreasonably withheld; and provided, however, that either party may assign any of its rights, benefits, and obligations under these Terms, without such consent, to an affiliate of such party.
   5. No Third-Party Beneficiaries.
      These Terms and each SOW shall be binding upon and inure solely to the benefit of the parties and their respective successors and permitted assigns, and nothing herein, express, or implied, is intended to or shall confer upon any other person any legal or equitable right, benefit, or remedy of any nature whatsoever, under or by reason of these Terms.
   6. General Warehouse Lien.
      Company includes its general warehouse lien on and against the Products and on the proceeds thereof for all charges for storage, handling, transportation (including demurrage and terminal charges), insurance, labor, and other charges present or future with respect to the Products.
   7. Public Announcements.
      Neither party shall issue any press release or make any other public announcement or comment relating to these Terms, any SOW, or the transactions contemplated herein without the prior written consent of the other party.
   8. Independent Status.
      Company is an independent contractor engaged by Customer to perform the Services. Nothing in these Terms shall make either party the legal representative or agent of the other nor shall either party have the right or authority to assume, create or incur any liability or obligation of any kind, express or implied, against, in the name of or on behalf of, the other party.
   9. Force Majeure and Non-Force Majeure Interruptions.
      In the event of riot, war, rebellion, fire, flood, act of God, terrorism, act of governmental authorities or any other cause beyond the reasonable control of a party (the “Affected Party”) which renders it impossible for the Affected Party to comply with the terms of these Terms or any SOW (a “Force Majeure Event”), there shall be no liability for non-compliance caused thereby during the continuance thereof except for compliance with Customer’s payment obligations contained herein; provided, however, in the event of any such Force Majeure Event affecting Company’s ability to perform the Services under a SOW, Company shall use its best efforts to eliminate the cause of such inability to perform and shall perform to the fullest extent it is able under the circumstances and Company shall, as soon as reasonably practicable, provide notice to Customer with detailed information regarding the cause of the Force Majeure Event, the anticipated delay, and an estimate schedule for addressing and minimizing the effects of the Force Majeure Event so as to keep Customer informed regarding same and to allow Customer to make an contingency plans that may be required under the circumstances. The following notice and information standard shall also apply to any non-Force Majeure Event that material limits or prevents Company from meeting its obligations under an SOW for a period of longer than five (5) business days.
   10. Governing Law.
       These Terms and each SOW and any claim or dispute arising out of or related to these Terms and any SOW or the transactions contemplated hereby, whether in contract, tort or otherwise, shall be governed by and construed in accordance with the laws of the State of Arizona without giving effect to its conflicts of law principles.
   11. Jurisdiction.
       Each party irrevocably consents and agrees that any legal action, suit or proceeding against either of them arising out of, relating to or in connection with the transaction contemplated hereby or disputes relating hereto may be brought only in United States District Court for the District of Arizona, or if such court does not have jurisdiction, in the courts of the State of Arizona located in Maricopa County, and hereby irrevocably accepts and submits to the exclusive jurisdiction of the aforesaid courts in persona, with respect to any such action, suit or proceeding.
   12. Captions.
       The captions in these Terms are for the purpose of reference only and shall not limit or otherwise affect the interpretation hereof.