Distribution Terms and Conditions

Buffalo Market, Inc. Distribution Agreement General Terms and Conditions

These Buffalo Market, Inc. Distribution Agreement General Terms and Conditions (“Terms and Conditions”) are incorporated by reference into any Distribution Agreement between Distributor and Supplier that explicitly incorporates them by reference (the “Distribution Agreement”). All Section references in these Terms and Conditions shall be references to provisions in these Terms and Conditions unless explicitly stated otherwise. Capitalized terms used in these Terms and Conditions without definition shall have the meanings given to them in the Distribution Agreement. References to this “Agreement” mean the Distribution Agreement, together with these Terms and Conditions incorporated therein.

1. GRANT OF RIGHTS; TERM

1.1 Grant. Supplier grants to Distributor during the Term and pursuant to the terms of this Agreement, and Distributor accepts, the right to distribute and sell Products in the Territory (the “Purpose”), and the license to use Supplier’s Marks (as defined below) in the Territory for the Purpose. If the Distribution Agreement indicates that the rights granted are Exclusive, Supplier agrees that it will not directly or indirectly distribute or sell Products inside the Territory or to any party Supplier has reasonable basis to believe will distribute or sell the Products inside the Territory, except to the extent otherwise expressly permitted in the Distribution Agreement. Distributor agrees that it will not directly or indirectly distribute or sell Products outside of the Territory, except as otherwise specified or authorized in the Distribution Agreement.

1.2 Term. The term of this Agreement (“Term”) shall be the term set forth on the Distribution Agreement, and shall be automatically extended for consecutive one (1) year periods on each anniversary of the Effective Date (or, if different, such one year extension shall begin at the end of the initial term set forth in the Distribution Agreement and at the end of each anniversary thereafter) unless either party provides written notice of termination to the other party not less than thirty (30) days prior to such anniversary (or the end of the initial term as the case may be) or the Agreement is otherwise earlier terminated in accordance with the Terms and Conditions.

2. PURCHASE OF PRODUCTS
2.1 Frequency. Distributor may order Products from Supplier at any time and from time to time in its sole

discretion during the Term unless otherwise agreed in advance in writing by the parties.

2.2 Order Placement. Absent written agreement by the parties, all orders shall be placed by the submission of a purchase order by Distributor to Supplier. Supplier shall confirm to Distributor the receipt of such purchase order issued hereunder within two (2) business days following Supplier’s receipt thereof. If Supplier fails to issue a confirmation within the time set forth in the foregoing sentence or commences performance under such purchase order without providing confirmation, Supplier will be deemed to have accepted the purchase order.

2.3 Prices. All Products will be sold to Distributor at the price listed on the then current Wholesale Price List less the Wholesale Price Discount Rate (the “Discount Price”). Supplier may amend the Wholesale Price List from time to time and shall notify Distributor upon any such amendment; provided, however, that Supplier shall give at least 14 days’ notice to Distributor prior to any amendment increasing any prices on the Wholesale Price List. The Discount Price for any Product shall be equal to or lower than the prices paid to Supplier by any other customer or distributor of Supplier for the same Product. The prices on the Wholesale Price List include, and Supplier is solely responsible for, all costs and expenses relating to packing, crating, shipping, customs, taxes, insurance, and any other similar financial contributions or obligations relating to the production, manufacture, sale and delivery of the Products from Supplier to Distributor.

2.4 Delivery. All Products shall be available for pickup by Distributor at the delivery point specified in the Distribution Agreement, or, if not so specified, at Supplier’s warehouse, or any other location as agreed upon by the parties in writing (the “Delivery Point”) and Supplier shall be solely responsible for delivery of the Products to the Delivery Point. Title to Products and risk of loss shall pass to Distributor upon Distributor’s taking possession of the Products at the Delivery Point. Supplier shall deliver all Products within the delivery time period specified in the Distribution Agreement from the date of receipt of Distributor’s purchase order or other authorized ordering document (but in any event on a reasonably timely basis under the circumstances). All costs of delivery of Products from Supplier to the Delivery Point shall be the sole responsibility of Supplier.

2.5 Payment Terms. Unless otherwise agreed in advance in writing by the parties or otherwise specified in the Distribution Agreement, payment for all purchases of Products by Distributor shall be due within thirty (30) days of delivery or invoice, whichever occurs later, except for any amounts disputed by Distributor in good faith.

2.6 Inspection and Defects. Distributor may inspect all deliveries of Product upon delivery to identify errors in order fulfillment, breakage or damage during shipment, defects in packaging or labeling, or other defects, and shall use good faith efforts to notify Supplier within five (5) business days of delivery of any such issues. Upon such notice, Distributor, in its sole discretion, may either reject such Products for a refund plus any inspection, test, or storage charges paid by Distributor, or require Supplier’s prompt correction or replacement of such Products, in which case Supplier will correct or replace such Products within three (3) business days of receiving such notice at no cost to Distributor. In each case the exercise by Distributor of any other rights available to Distributor under this Agreement or pursuant to applicable law shall not be limited.

2.7 Product Returns, Markdowns and Credits. Supplier shall reimburse Distributor for (a) Product returns, (b) quantity and cash discounts, (c) trade allowances or markdowns granted on account of unsalable or discontinued Products, and (d) any other deductions, chargebacks, rebates, credits, allowances or adjustments taken by a customer against a Product purchased from Supplier, as well as any fines, assessments, interest, liens and fees incurred by Distributor related to, arising out of or associated with any of the foregoing (collectively “Distributor Reimbursements”). Supplier shall reimburse Distributor within thirty (30) days’ written notice from Distributor for all such Distributor Reimbursements. For purposes of clarity, Distributor will not have the right to return Product to Supplier solely due to such Product not being sold.

2.8 Set-Off. All amounts due from Distributor to Supplier are net of any indebtedness of, or amounts owed by, Supplier to Distributor. In addition to any right of set-off, deduction or recoupment provided or allowed by applicable law, Distributor may, without notice to Supplier, set off against, and deduct and recoup from any amounts due or to become due to Supplier from Distributor any amounts due or to become due to Distributor from Supplier. If an obligation of Supplier is disputed, contingent or unliquidated, payment by Distributor of all or any portion of the amount due may be deferred until such dispute contingency is resolved or the obligation is liquidated. In the event of Supplier’s bankruptcy, if all of the contracts (including this Agreement) have not been promptly assumed by Supplier under applicable law, Distributor may withhold payment to Supplier for Products previously delivered (via administrative hold or otherwise) until the risk of potential rejection and other losses is eliminated.

2.9 Notice of Discontinuance. Supplier shall provide Distributor with three (3) months’ advance written notice before discontinuing a Product.

3. DISTRIBUTORS DUTIES.

3.1 Marketing and Inventory. At all times during the Term, Distributor shall reasonably cooperate with and participate in supplier’s marketing campaigns by distributing marketing and advertising materials provided by Supplier and encouraging the use and display of such materials by retail outlets within the Territory. Distributor shall keep its inventory properly stored, in accordance with all relevant regulatory standards, and at adequate facilities for goods such as the Products.

3.2 In-Stock Guarantee. Distributor guarantees that during the Term, the Products will be in stock at least 98% of the time, subject to and conditioned upon Supplier meeting its supply, delivery and related obligations under and in accordance with this agreement. In the event Distributor fails to satisfy or breaches this guarantee, Supplier may terminate this Agreement, as its sole and exclusive remedy (and Distributor’s sole liability) for any such failure or breach, upon thirty (30) days prior written notice to Distributor; provided that Distributor does not cure such failure or breach within five (5) business days of such termination notice. For the avoidance of doubt, in the event of any termination of this Agreement by Supplier under this Section 3.2 in accordance with the foregoing, no Buyout Fee shall be due from Supplier under Section 9.4 below.

4. SUPPLIERS DUTIES. At all times during the Term, Supplier shall use commercially reasonable efforts to market and promote the Products generally and shall provide, at Supplier’s expense, relevant marketing and advertising materials and technical assistance to Distributor. Supplier shall be solely responsible for all marketing fees, trade fund allowances, slotting fees, or any other fees relative to the marketing, programming, or selling of the Products, and shall pay Distributor for such fees within thirty (30) days’ written notice from Distributor. Supplier shall provide a quantity of samples of any Products as agreed upon in writing by the parties, but in no event less than a reasonable amount, at the request of Distributor, and such samples shall be free of charge to Distributor. Supplier shall utilize best efforts to maintain commercially reasonable levels of inventory of the Products and/or production capacity sufficient to meet Distributor’s requirements. In the event that Supplier is unable to fulfill Distributor’s orders due to a shortage of inventory or production of Products, Supplier shall equitably fulfill Distributor’s orders such that (a) no other distributor of Supplier’s receives a disproportionate volume of Product relative to the size and population of the Territory and such other distributors’ territories and (b) no open orders of Distributor’s go unfilled for more than thirty (30) days after they are placed. Supplier shall provide Product launch training to Distributor’s personnel as applicable in connection with the marketing, sale, and support of the Products. Supplier shall provide appropriate field assistance to Distributor and Distributor’s customers as applicable.

5. COMPLIANCE WITH LAWS. Supplier covenants to Distributor that it is in compliance with and shall comply with all applicable laws, regulations and ordinances, including, but not limited to, those laws, regulations and ordinances applicable to the manufacturing, storing, shipping, and marketing of the Products, including (a) the Agriculture Improvement Act of 2018 and Section 7606 of the Agricultural Act of 2014, together with any other federal statutes, rules, as such may be amended from time to time, and (b) all laws, rules and regulations imposed pursuant to any state legislation, if any (collectively, the “Regulatory Laws”). Supplier has and will maintain in effect all the licenses, permissions, authorizations, consents and permits that it needs or is required to carry out its obligations under this Agreement in conformance with all applicable Regulatory Laws, regulations and ordinances.

6. TRADEMARKS. Distributor may use Supplier’s trade names, trademarks and service marks (collectively, “Marks”) for each Product in the Territory for the duration of the Agreement in connection with the Purpose, and for the purpose of describing itself as an authorized distributor of Supplier.

7. REPRESENTATIONS AND WARRANTIES.
7.1 Supplier represents and warrants as follows:

(a) It is duly organized, validly existing and in good standing under the laws of its state of its incorporation and has the power and authority to enter into this Agreement and to fully perform its obligations hereunder.

(b) This Agreement has been executed by its duly authorized representative and constitutes its valid, binding obligation and there are no other agreements with any other party in conflict with this Agreement.

(c) Title to the Products purchased by Distributor under this Agreement will be free and clear of liens, security interests and other encumbrances that would otherwise prevent Distributor’s resale or distribution

(d) All Products sold by it to Distributor will (i) conform to all applicable Regulatory Laws, (ii) be free from defects, merchantable, and fit for the purpose of which their use is intended, and (iii) not infringe or misappropriate any third party’s patent or other intellectual property rights. These warranties survive any delivery, inspection, acceptance or payment of or for the Products by Distributor. These warranties are cumulative and in addition to any other warranty provided by law or equity.

7.2 Distributor represents and warrants as follows:

(a) It is duly organized, validly existing and in good standing under the laws of its state of its incorporation and has the power and authority to enter into this Agreement and to fully perform its obligations hereunder.

(b) This Agreement has been executed by its duly authorized representative and constitutes its valid, binding obligation and there are no other agreements with any other party in conflict with this Agreement.

8. CONFIDENTIALITY. During the Term, the parties acknowledge that they may disclose to one another certain non-public information concerning their respective businesses or operations and/or the Products, including but not limited to trade secrets, other proprietary or confidential information, and this Agreement (collectively, “Confidential Information”). During the Term each party shall treat the other party’s Confidential Information with at least the same level of care as its own Confidential Information, but not less than reasonable care. During the Term and two (2) years thereafter, each party shall, (a) not disclose the Confidential Information of the other party to any third party, and (b) use the other party’s Confidential Information only for the Purpose or, if necessary, to enforce of this Agreement (which shall be done in a manner that preserves the confidential nature of Confidential Information).

9. TERMINATION

9.1 For Breach. Either party may terminate this Agreement for a breach by the other party that is not cured within 30 days of written notice of such breach. In the event of a breach is caused by a Force Majeure event under Section 12.7, the cure period under this section shall be extended by 30 days upon written request from the breaching party made prior to termination.

9.2 By Mutual Agreement. The parties may terminate this Agreement by mutual written agreement at any time.

9.3 Effect of Termination. On the expiration or earlier termination of this Agreement, Distributor may, in accordance with the terms of this Agreement, sell off its existing inventories of Products for a period of three (3) months following the last day of the Term.

9.4 Supplier Buyout. In the event that Supplier desires to terminate this Agreement, other than for breach or by mutual agreement under Sections 9.1 or 9.2 (but including without limitation any termination by Supplier under Section 1.2 above), Supplier agrees to pay to Distributor a compensatory termination buyout fee (“Buyout Fee”) equal to the fair market value of Distributor’s lost distribution rights and lost sales opportunities for the Products hereunder. The Buyout Fee shall in any event not be less than three times (3X) the Gross Profit, as defined below, earned by Distributor from the sale of Products during the twelve (12) month period immediately preceding the effective date of termination by Supplier, or if Products have not been sold for the full prior twelve month period at such time, then Gross Profit will be based on the reasonable forecast or projection of sales of Products over the upcoming twelve month period (as if the Agreement remained in effect for an additional twelve months). For purposes of this Agreement, “Gross Profit” shall mean Distributor’s selling price(s) of all Products less the net invoice price paid by Distributor to Supplier hereunder for all Products sold (or forecast or projected to be sold, if applicable) to Distributor hereunder, less any allowance or bill backs paid or owed to Distributor (e.g., discounts, off invoice allowances, rebates and price reductions). Notwithstanding the foregoing, the Buyout Fee and Gross Profit calculation shall not include any sales attributable to excluded accounts which are expressly specified as excluded from the Buyout Fee in the Distribution Agreement. Supplier shall pay the Buyout Fee to Distributor on or prior to the effective date of termination by Supplier.

9.5 Survival. Any termination or expiration of this Agreement shall not affect Supplier’s or Distributor’s rights or obligations that expressly or by their nature continue and survive (including without limitation, Sections 5, 7 through 10 and 12).

10. INDEMNIFICATION AND INSURANCE; LIMITATION OF LIABILITY

10.1 Indemnification. Supplier shall indemnify, defend and hold harmless Distributor, its officers, directors, employees, agents, affiliates, successors and assigns (each an “Indemnified Party,” and collectively, “Indemnified Parties”) against any and all losses, damages, liabilities, deficiencies, claims, actions, judgments, settlements, interest, awards, penalties, fines, costs, or expenses of whatever kind, including reasonable attorneys’ fees, fees and the cost of enforcing any right to indemnification under this Agreement and the cost of pursuing any insurance providers, incurred by Indemnified Party, relating to any claim of a third party arising out of or occurring in connection with (a) the Products purchased from Supplier, (b) Supplier’s negligence, willful misconduct or breach of this Agreement, or (c) any claim that Indemnified Party’s use or possession of the Products infringes or misappropriates the patent, copyright, trade secret or other intellectual property right of any third party. Supplier shall not enter any settlement without Distributor’s prior written consent.

10.2 Insurance. Supplier, during the Term and for one (1) year thereafter, shall maintain insurance in full force and effect that includes, but is not limited to, commercial general liability (including product liability) with limits of no less than $1,000,000 for each occurrence and $2,000,000 in the aggregate with financially sound and reputable insurers. All such policies shall name Distributor as an additional insured upon request by Distributor. Supplier shall provide Distributor with Certificates of Insurance evidencing the above and shall obtain a written obligation to notify Distributor at least ten (10) days prior to cancellation, termination, or modification of such insurance.

10.3 Exclusion of Consequential and Related Damages. WITHOUT LIMITING THE RIGHTS AND OBLIGATIONS Of THE PARTIES UNDER SECTION 10.1 (INDEMNIFICATION), IN NO EVENT SHALL EITHER PARTY HAVE ANY LIABILITY TO THE OTHER PARTY FOR ANY LOST PROFITS OR REVENUES OR FOR ANY INDIRECT, SPECIAL, INCIDENTAL, CONSEQUENTIAL, COVER OR PUNITIVE DAMAGES HOWEVER CAUSED, WHETHER IN CONTRACT, TORT (INCLUDING NEGLIGENCE) OR UNDER ANY OTHER THEORY OF LIABILITY, AND WHETHER OR NOT SUCH PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES AND NOTWITHSTANDING ANY FAILURE OF THE ESSENTIAL PURPOSE OF THIS AGREEMENT OR ANY LIMITED REMEDY HEREUNDER.

  1. NOTICES. Notices under this Agreement shall be delivered by certified or registered mail or email (a) with respect to Supplier, at the addresses on the Distribution Agreement, and (b) with respect to Distributor, at the following addresses (or at such other address as Distributor or Supplier may identify in writing during the Term), and shall be effective upon delivery (or, in the case of email, upon confirmed receipt).

    Buffalo Market, Inc.
    8030 W. Doe Ave.

    Visalia, CA 93291 a@buffalomarket.com

  2. MISCELLANEOUS

12.1 Recall. If Supplier, Distributor, or any governmental authority determines that a recall of any Products sold to Distributor is necessary, either party may implement such recall campaign. Distributor shall return any defective Products to Supplier or destroy such Products, as determined by Distributor, at Supplier’s sole cost and risk. Without limitation of any rights otherwise available to Distributor, if a recall campaign is implemented, at Distributor’s option and Supplier’s sole cost, Supplier shall promptly either replace, or credit or refund the prices paid by Distributor for, all such returned Products.

12.2 Assignment. Supplier may not assign this Agreement without the prior written consent of Distributor. Distributor may assign in whole or part this Agreement provided that any such subsequent assignee agrees to accept the terms and conditions of this Agreement then existing. This Agreement is binding on and insures to the benefit of the parties to this Agreement and their respective successors and permitted assigns.

12.3 Independent Contractor Relationship. The parties expressly agree and acknowledge they are independent contractors and are not partners, joint venturers or agents of the other. Each party will maintain complete control over its respective employees and agents and its relationships with its respective agents and contractors. Nothing in this Agreement creates any contractual relationship between a party and any agents or contractors of the other party. Each party will perform its obligations in accordance with its own methods and procedures, subject only to compliance with this Agreement. Neither party will be liable for any debts, acts, or obligations of the other or the other’s agents, employees, or contractors.

12.4 Data Collection. Supplier hereby grants Distributor a non-exclusive, worldwide, perpetual, transferable, royalty-free license to use, copy, transmit, sub-license, index, store, aggregate, and display Transaction Data in connection with the operation and maintenance of Distributor’s distribution and related services, for technical support, to otherwise perform obligations to Supplier or any other of Distributor’s suppliers or other customers, to perform account management services, and to publish, display, and distribute de-identified, aggregated information derived from Transaction Data and other information from Supplier’s use of Distributor’s services for marketing, research or compliance purposes, for purposes of improving Distributor’s services, and for developing, displaying, and distributing benchmarks and similar reports, provided that any such data is not publicly identified or identifiable as originating with or associated with Supplier. The foregoing shall not limit the ability of Distributor to publish or otherwise share or distribute information regarding Supplier that is obtained from publicly available or nonconfidential sources. “Transaction Data” means any data of any type regarding transactions between Supplier and Distributor and the purchase and sale of Products, including without limitation product type, pricing and quality, sale price, fees and deductions and time periods for sale or liquidation.

12.5 Privacy Policy. Supplier hereby consents to Distributor’s privacy policy, located on its website at https://www.buffalomarket.com/pages/pricacy-policy, which describes Distributor’s privacy practices and is incorporated by reference into this Agreement. By Supplier’s entering into this Agreement, Supplier consents to any updates to the Distributor’s privacy policy that may be published on the Distributor’s website from time to time.

12.6 Governing Law; Forum. The laws of the United States of America and the State of California govern all matters arising out of or relating to this Agreement without giving effect to any conflict of law principles. Each of the parties irrevocably consents to the exclusive personal jurisdiction of the federal and state courts located in the Central District of California for any matter arising out of or relating to this Agreement, except that in actions seeking to enforce any order or any judgment of the federal or state courts located in the Central District of California, such personal jurisdiction will be non-exclusive. Additionally, notwithstanding anything in the foregoing to the contrary, a claim for equitable relief arising out of or related to this Agreement may be brought in any court of competent jurisdiction. If a proceeding is commenced to resolve any dispute that arises between the parties with respect to the matters covered by this Agreement, the prevailing party in that proceeding is entitled to receive its reasonable attorneys’ fees, expert witness fees and out-of-pocket costs, in addition to any other relief to which that prevailing party may be entitled.

12.7 Force Majeure. Supplier and Distributor shall be excused for the period of any delay in the performance of any obligations under this Agreement when substantially prevented from so doing by labor disputes, civil commotion, war, unforeseeable governmental regulations or controls, fire or other casualty, pandemics, terrorism, acts of God or other events beyond such party’s reasonable control.

12.8 Severability. If a court of law holds any provision of this Agreement to be illegal, invalid or unenforceable, (a) that provision shall be deemed amended to achieve an economic effect that is as near as possible to that provided by the original provision and (b) the legality, validity and enforceability of the remaining provisions of this Agreement shall not be affected thereby.

12.9 Waiver; Amendments. Failure by either party to enforce a provision of this Agreement shall not constitute a waiver of that or any other provision of the Agreement. No modification or waiver of this Agreement or of any covenant, condition or limitation contained herein shall be valid or effective unless it is (a) in writing and duly executed by the parties hereto, or (b) electronically accepted by Supplier upon electronic offer from Distributor. Supplier’s continued use of Distributor’s services after notification of modifications of these Terms and Conditions by Distributor will be deemed acceptance by Supplier hereunder.

12.10 Entire Agreement. This Agreement constitutes the final and exclusive agreement between the parties with respect to the subject of this Agreement and supersedes all agreements regarding such subject matter, whether prior or contemporaneous, written or oral. It is specifically agreed that no printed standard terms that may appear on any quotations, purchase orders, acceptance notes or invoices relating to the Products under this Agreement shall have any effect.

End of Terms and Conditions