Purchase Order Terms and Conditions
These Purchase Order Terms and Conditions (the “Terms and Conditions”) are part of each purchase order that Gordon Food Service, Inc. or any of its affiliates, whether currently an affiliate or subsequently becoming an affiliate (collectively, “GFS”) issues. In these Terms and Conditions, “Buyer” means GFS or its affiliate(s), whether currently existing or subsequently arising, as specified in the purchase order, “Seller” means the seller named in the order, “goods” and “services” mean the goods or services that Buyer is to purchase from Seller, as described in the purchase order, “Agreement” means the agreement formed pursuant to the purchase order (including the terms of these Terms and Conditions), “Order” means the purchase order, and “affiliate” of Buyer or of GFS means at any time, whether currently existing or subsequently arising, any corporation, limited liability company, partnership or other entity or individual that then controls, is controlled by, or is under common control with, Buyer or GFS, as applicable:
1. AGREEMENT. The Order is subject to the terms of any written agreement between Buyer and Seller that provides that these Terms and Conditions will apply to Buyer’s purchases from Seller to the exclusion of any additional or different terms contained in Seller’s quotation, proposal or acknowledgment, or otherwise proposed by Seller. If there is ever a conflict between a provision of any such written agreement and a provision of these Terms and Conditions, then the provision of the written agreement shall prevail. The Order, including these Terms and Conditions, and the written agreement, if any, contain all of the terms of the Agreement between Seller and Buyer with regard to its subject matter and supersedes all prior oral or written representations, agreements and other communications between Seller and Buyer, and may be only amended by a writing signed by duly authorized officers of Buyer and Seller. The terms of the Agreement (including, without limitation, the terms of these Terms and Conditions) apply to the exclusion of any different or additional terms contained in Seller’s quotation, proposal or acknowledgement or otherwise proposed by Seller. Seller’s acceptance of these Terms and Conditions shall be conclusively presumed by Seller’s shipment of the goods or performance of the services requested under the Agreement and/or the Order, or by Seller’s return to Buyer of an acknowledgement of this Order. If for any reason, however, there is not a written agreement between Buyer and Seller, then (a) the Order is Buyer’s revocable offer to buy, and Buyer rejects any earlier offers that Seller has made to sell to Buyer, (b) if the Order nevertheless is in legal effect an acceptance of an earlier offer by Seller, then Buyer’s acceptance is conditional upon Seller’s assent to all terms of the Order and these Terms and Conditions that are additional to or different from the terms of Seller’s offer and (c) by signing and returning a copy of the Order or by accepting the Order electronically or by shipping the goods or performing the services, Seller (i) accepts Buyer’s offer and, if Buyer’s Order is in legal effect an acceptance of an earlier offer by Seller, (ii) assents to all terms of the Order that are additional to or different from the terms contained in Seller’s offer.
2. PRICE. The price to be paid by Buyer and stated on any Order shall not be increased unless specifically authorized in writing by issuance of a revised Order by Buyer. Seller warrants that the prices charged Buyer and stated on the Order are no higher than prices charged on orders placed by others for similar quantities under similar conditions. If Seller shall establish, prior to shipment under any Order, lower prices or terms more favorable to Buyer than those stated on that Order, the lower prices or more favorable terms will apply to that Order. Seller and Buyer agree to submit to quarterly business reviews where deemed necessary by the Buyer. The primary focus of these reviews will be to plan and execute strategies that will increase sales growth.
3. TAXES AND PAYMENT TERMS. Unless Buyer agrees otherwise in writing, or as required by a particular province of Canada (as acknowledged in writing by both Buyer and Seller), Buyer shall not be required to pay any sales, use or other taxes (whether federal, provincial, state or local, including Goods and Services/Harmonized Sales Tax “GST”, “HST” or provincial similar tax “PST”), assessments, fees or duties arising because of Buyer’s purchase from Seller or Seller’s manufacture, performance or sale of the goods or services (including, without limitation, any tax, assessment, fee or duty measured or imposed upon Seller’s income, payroll or property and any franchise tax) (“Taxes”), and Seller shall be responsible and liable for paying, and shall pay, all Taxes, provided, however, if such Taxes were not in effect at the time that Buyer and Seller entered into their agreement for Seller’s production of goods for Buyer, any such Taxes shall be paid by the party upon which the legal incidence of the Tax is imposed. If applicable, the Seller shall provide all tax exemption number for each applicable province. If Buyer agrees in writing to pay any Tax, then the correct dollar amount of the Tax shall be separately stated on Seller’s invoice. Buyer shall not be required to pay any late charge, interest, finance charge or similar charge. Invoices shall be paid according to discount terms, or if no discount is offered, according to due date terms. If no discount or due date is indicated, payment shall be made within sixty (60) days after receipt and acceptance of the goods under any order. Buyer’s payment of the purchase price does not constitute acceptance of goods or services. Discount periods will be computed from the date the goods arrive at Buyer’s distribution center specified in the Order. If an invoice is due on a non-business day or banking holiday, the due date shall be extended until the next business day. Seller shall give GFS written notice of any claimed discrepancy in any amount paid or deducted by GFS pursuant to this Agreement within 180 days of such payment or deduction. If Seller fails to give notice within such period, Seller agrees that it will not thereafter assert any claim for such payment or deduction and waives any such claim.
4. PACKING AND CARTAGE. The following specific delivery terms shall be applicable to each delivery made by Seller to Buyer under any Order:
(a) Buyer shall not be charged for packing or cartage expenses. Such expenses shall be paid by Seller.
(b) Seller shall include with each shipment a document listing each item and quantity separately, as indicated on the Order.
(c) Seller shall not back order without prior approval of Buyer.
(d) Buyer reserves the right to reject shipment and return goods at Seller’s expense if each container, and each package therein, are not adequate for reshipment and not marked to meet requirements of existing labeling laws, and existing weight and measure laws. Each container shall bear the name of Seller, unless the goods bear any of Buyer’s proprietary brands.
(e) Seller shall, in full compliance with Buyer’s policy NAPOL0110 Disposition of GFS Controlled Branded Product, remove any packaging displaying Buyer’s, or any of its affiliates’, logos or proprietary brands from all GFS private branded goods as defined in NAPOL0110, as amended from time to time (“GFS Private Branded Goods”), that are returned to Seller before Seller may offer such goods for resale, salvage, or donation.
(f) If any governmental registration or approval is required for the goods, such registration or approval shall be obtained by Seller at Seller’s expense.
(g) Palletized loads shall be delivered on Buyer’s approved pallets only.
5. DELIVERY. Unless Buyer agrees otherwise in writing, Seller shall deliver the goods Standard International Delivery Term (Incoterms 2000) DDP (“delivered duty paid”) at Buyer’s facility identified in the order, except that if Buyer’s facility and Seller’s facility from which the goods will be shipped are both located in Canada, then Seller shall deliver the goods F.O.B (Incoterms 2000) Buyer’s facility identified in the order and shall be made at Seller’s expense and risk of loss. Buyer may, at its option, take delivery of all or any part of the goods at Seller’s facility, in which case risk of loss for such goods shall shift to Buyer when Buyer or its shipping agent departs Seller’s facility after taking delivery of the goods. Seller shall use any mode of shipment, carrier and routing that Buyer specifies. Delivery shall be made in the quantities and at the times specified by Buyer to Seller. Unless the Buyer agrees otherwise in writing, Seller shall deliver all of the Goods in a single delivery and not in installments. If Seller delivers the goods before the scheduled delivery date, Buyer may, at Seller’s expense and risk, either store them or return them to Seller. Buyer’s acceptance of an early delivery shall not change the payment terms. Buyer shall not be liable for payment for goods delivered in excess of the quantities or after the times specified in Buyer’s delivery instructions to Seller. Buyer will hold excess goods at Seller’s expense and risk for ten (10) days and await Seller’s instructions for disposition of the goods. If Seller does not provide Buyer instructions for disposition of such excess goods within ten (10) days, Buyer may use or dispose of such excess goods as it pleases and charge the cost of such disposition, if any, to Seller. In no event must Buyer pay for excess goods used or disposed. Time is of the essence, and Buyer’s stated delivery date(s) or performance schedule and the date for performance of any other obligation of Seller shall not be extended or excused for any reason, including anything that Seller cannot control. Unless the Buyer agrees otherwise in writing, Seller shall deliver all of the Goods in a single delivery and not in installments. Seller fill rate performance expectation is 99.5% at each division. If Seller does not achieve an average division fill rate of 99.5%, then GFS will deduct for any PO fill rate that falls below the 98% threshold. The amount of each penalty is 10% of the PO value up to $500.
6. CHANGES; CANCELLATION. Buyer may cancel, modify or suspend any Order if such cancellation, modification or suspension is made prior to shipment. Buyer may at any time, by reasonable advance written notice to Seller, change the Agreement as to (a) designs or drawings of, or specifications, standards, performance criteria, or other requirements for, the goods or services, (b) time, place, frequency or schedule of delivery or performance, (c) method of packing or shipment, or (d) quantity of the goods or extent of the services. With the exception of a change or suspension to delivery schedules, if any of the above changes causes a change in Seller’s cost or time of performance, then an equitable adjustment shall be made in the price or time for delivery or performance, or both, if, but only if, Seller gives Buyer a written request for an adjustment within thirty (30) days after Buyer notifies Seller of the change and Buyer consents in writing to the change. The Seller shall give reasonable advance written notice to the Buyer of any proposed change to (a) designs or drawings of, or specifications, standards, performance criteria, or other requirements for, the goods or services, (b) time or place of delivery or performance, (c) method of packing or shipment, or (d) quantity of the goods or extent of the services. The Seller shall not deliver product with aforementioned changes without prior written authorization from an authorized officer of Buyer.
7. INSPECTION. All goods received at Buyer’s distribution facilities will be subject to the terms and conditions contained in Buyer’s Document Number SOP0500 GFS Receiving Requirements (“Buyer’s Receiving Requirements”). Regardless of where Buyer takes delivery of the goods, Buyer reserves the right to inspect, test and approve goods described in any Order, as well as the right to reject any goods not conforming to the terms of any Order. To the extent Buyer rejects goods as nonconforming, the quantities under that Order will automatically be reduced unless Buyer otherwise notifies Seller. Seller will not replace quantities so reduced without a new Order from Buyer. Non-conforming goods will be held by Buyer for disposition in accordance with Buyer’s Receiving Requirements at Seller’s risk. Payment for non-conforming goods shall not constitute an acceptance thereof, limit or impair Buyer’s right to any legal or equitable remedy, or relieve Seller’s responsibility for latent defects.
The Seller shall perform reasonable amounts of testing and inspection with respect to each shipment of the goods to ensure the products comply with the requirements of the contract. The testing methods and procedures shall conform to the standards, specifications and other requirements (a) that Buyer provides to Seller, (b) that are prescribed by any applicable law or regulation or requirement of any governmental agency, or (c) that are otherwise specified or agreed to in writing. Upon Buyer’s request, Seller shall furnish to Buyer, before or upon delivery of the goods, a copy of the results of, and a certificate of analysis with respect to, each test. Seller shall make a record of the date, time and results of each test and the testing procedure used and shall retain all inspection and test records for two years after the goods are delivered to Buyer or for any reasonable additional period that Buyer specifies. Upon Buyer’s reasonable request from time to time, Seller shall furnish copies of the records to Buyer at no charge. Additionally, Seller shall cause to be performed, at its sole expense, all third party testing Buyer may reasonably request to determine whether goods provided to Buyer under the Agreement conform to the standards, specifications and other requirements of the Agreement.
8. REPRESENTATIONS, WARRANTIES AND AGREEMENTS ABOUT SELLER. Seller represents and warrants to Buyer, its customers and assigns, and agrees, that as of the date of the Agreement (or such other date or dates specified in a particular representation or warranty) that the following statements are true and correct: (a) the Agreement is the valid and binding obligation of Seller, enforceable against Seller in accordance with its terms; (b) Seller has all necessary experience, qualifications, expertise, authority, licenses and permits to enable it to perform its obligations under the Agreement; (c) Seller is and, at the time of each delivery of the goods will be, solvent; (d) neither Seller nor Seller’s agents have offered or given, and shall not offer or give, any gratuity or thing of value to any employee of Buyer or of any Affiliate of Buyer; (e) Seller and each of Seller’s agents is and shall continue to be in compliance with all laws, orders and regulations that prohibit discrimination against (1) any employee or applicant because of race, color, religion, sex, or national origin, (2) qualified protected veterans and (3) qualified individuals on the basis of disability; (f) any oral or written merchandise plan, advertising or promotion plan, payment, discount, or allowance and/or any service or facility Seller (either directly or through its agents) offers, gives, or pays to Buyer, complies with the applicable federal, provincial, state or local laws for such commerce; (g) Seller does not, and shall continue to refrain from, selling or otherwise providing similar Goods to, or through, any third party intending to sell the Goods to Buyer’s customers at an average price less than the price provided by Seller to Buyer for the similar Goods under the Agreement, (h) Seller is and shall continue to be in compliance with all applicable federal, provincial, state, local and foreign laws, regulations, standards and orders, including, without limitation, the CFIA Safe Food For Canadians Act (the “SFCA”) and all regulations issued under such Act, anti-terrorism, safe shipment and food safety (including any Material Safety Data Sheets); (i) Seller is and at all times shall remain in compliance with the Corruption of Foreign Public Officials Act (Canada), the United States Foreign Corrupt Practices Act and the UK Bribery Act of 2010, and other similar laws; and (j) Seller is entering into this Agreement on its own behalf and not as an agent for any third party. These warranties shall be in addition to any other warranties stated in this Agreement or available to Buyer under applicable law. Seller is responsible to provide Buyer (i) product technical information to reasonably enable Buyer to define specification requirements for GFS Private Branded Goods and (ii) any information requested by Buyer that is necessary or helpful to Buyer in complying with any and all federal, state, local and foreign laws, regulations, standards and orders that may apply to the goods or services provided by Seller under the Agreement.
9. REPRESENTATIONS. WARRANTIES. AND AGREEMENTS ABOUT BUYER. Buyer represents and warrants to Seller, and agrees that (a) the Agreement is the valid and binding obligation of Buyer, enforceable against Buyer in accordance with its terms; (b) Buyer will provide specification authorization for GFS Private Branded Goods; (c) Buyer has the valid right to license or sublicense to Seller any trademarks, trade names, logos, or other intellectual property to be used by Seller in connection with its production of the goods.
10. REPRESENTATIONS, WARRANTIES AND AGREEMENTS ABOUT THE GOODS AND SERVICES. Seller represents and warrants to Buyer, and agrees, that (a) the goods and all materials that Seller furnishes in connection with the services shall be new, (b) the goods and services and all materials that Seller furnishes in connection with the services shall be merchantable, of good material, workmanship and quality, fit for the purposes for which Buyer intends them and free from faults and defects, (c) the goods and services and all materials that Seller furnishes in connection with the services shall conform to any samples, designs, drawings, specifications, standards, performance criteria or other requirements (collectively called “Specifications”) that are referred to in the order or that Buyer has provided to Seller or otherwise specified or agreed to in writing, or, to the extent that any required Specifications are not referred to in the order or provided by Buyer to Seller or otherwise specified or agreed to in writing, the Specifications provided by Seller to Buyer, (d) the goods, their manufacture, packaging, labeling, branding and sale and the services shall comply with all applicable federal, provincial, state, local and foreign laws, regulations, standards and orders, including, without limitation, those laws relating to labor standards, food and agricultural growing, shipment and sale, labeling of food and packaging, food allergen, (e) GFS Private Branded Goods shall utilize only GFS authorized label artwork, (f) the goods shall be produced, labeled, packaged, tested, delivered and sold in full compliance with the following policies of Buyer, as amended from time to time: Bar Code Policy, Pallet Policy to the goods and services. Supplier Code of Conduct (“the Code”), a supplier means any direct or indirect vendor, broker, consultant, or other service provider to Gordon Food Service and its affiliates and subsidiaries. This Code sets forth the principles and ethical standards that we expect all our suppliers to work toward achieving throughout the course of our business relationship. Suppliers who knowingly violate laws or have repeated problems conforming to these principles may not receive our business. All manufacturing and outside storage facilities that supply Gordon Food Service are expected to undergo, at their cost, annual independent third party facility GMP audits and/or GFSI certifications. This applies to food and non-food suppliers. Gordon Food Service private brand suppliers must follow NASOP0302 Branded Supplier Third Party Audit Program requirements. Appropriate corrective actions are to be developed and implemented immediately to address deficiencies that present a risk to food safety, security, quality, or traceability. Upon Buyer’s request, Seller shall give Buyer certificates of compliance with applicable laws, regulations, standards, and orders. Buyer’s approval of a sample, design, drawing, specification, standard, performance criteria, or other requirement shall not relieve Seller of any of its warranties under this paragraph, including, without limitation, its warranties of merchantability, fitness and compliance with laws. Seller’s warranties extend to future performance of the goods and services and survive inspection, tests, acceptance and payment and shall be considered to have been given not only to Buyer but also to Buyer’s customers and to end-users of the goods. Seller’s warranties apply to any replacement goods or services that Seller furnishes under these Terms and Conditions or otherwise. All products, with the exception of customer proprietary items, supplied to GFSC must be loaded to ECCnet at the FS3 certification level (core data plus marketing and nutritional information) accompanied by at least one high-resolution image or ECCnet montage, and published to GFSC. This level of product data is fundamental to our ability to fully support the E-Commerce initiatives between GFSC, the vendors, and our mutual customers. If Seller chooses not to participate, Seller will be subject to a product setup administration fee of $200 per item for any new non-proprietary item not loaded and published to GFSC or GFSC may choose not to list Seller’s new items.
11. INDEMNITY. Seller agrees to indemnify and hold harmless Buyer and each Affiliate of Buyer and Buyer’s and each such Affiliate’s directors, officers, employees, agents, shareholders, customers and other end-users of the goods (collectively, with Buyer, called “Indemnitees”) and defend any Indemnitees, if Buyer requests, as to any claims, liabilities, losses, damages (a) any breach by Seller (or Seller’s agents) of any of Seller’s warranties to, or agreements with, Buyer in the Agreement, (b) any death, injury or damage to any person or property (including any Indemnitee’s property and employees) caused by the goods or services or by Seller’s manufacture of the goods or performance of the services attributable to Seller’s failure to produce the goods or render the services in compliance with the specifications provided by Buyer, or (c) any contract or commitment entered into or made by Seller with or to any third party that provides goods, materials or services to Seller in connection with the Agreement. Any provisions of these Terms and Conditions requiring Seller to maintain insurance for property damage, personal injury, death and economic damage shall not be construed to affect or impair the generality of the foregoing. Each Indemnitee shall have the right to participate with Seller in the defense of any claim, which participation shall be at the Indemnitee’s expense, except that if Seller shall have failed, upon the Indemnitee’s request, to assume the defense or to employ counsel reasonably satisfactory to the Indemnitee, then Seller shall reimburse the Indemnitee, on a monthly basis, for all costs and expenses, including reasonable attorneys fees, that the Indemnitee incurs in connection with the defense. Notwithstanding the foregoing, Seller shall not be required to indemnify Indemnitees against or hold Indemnitees harmless from Buyer’s own willful misconduct or gross negligence or from claims, liabilities, losses, damages, and expenses resulting solely from Buyer’s breach of any of its representations, warranties, or covenants made in the Agreement. Buyer agrees to indemnify and hold Seller and Seller’s agents and employees harmless from and against any and all claims and causes of action brought against Seller and from any and all damages, losses, expenses, attorneys’ fees, cost and liabilities sustained by Seller arising out of Buyer’s willful misconduct or gross negligence in the performance of its obligations under this Agreement.
12. BUYER’S RIGHTS. Without limiting other rights and remedies available to it, Buyer may, at its option, (a) return nonconforming goods or services to Seller, at Seller’s risk and expense, as long as Buyer would then have the right under applicable law to reject or to revoke acceptance of those goods or services, and require Seller either to refund the price or promptly to repair or replace the goods, or re-perform the services, at Seller’s risk and expense, (b) retain nonconforming goods or services and set off losses against any amount after consultation and agreement of Seller that Buyer or any Affiliate of Buyer owes Seller, or (c) repair or replace nonconforming goods or obtain conforming services from a third party, and charge Seller with the expense. All goods sold to Buyer are purchased as a guaranteed sale. Buyer may, at its option, return reasonable amounts of salable inventory of such goods for full credit upon notice to Seller. Seller must respond to Buyer within ten (10) business days of its receipt of such notice. If Seller has not responded within ten (10) days following Buyer’s notice, then Buyer may dispose of the goods at Seller’s expense, and Seller will promptly reimburse Buyer for the cost of the goods and the disposal. If at any time Buyer believes in good faith that it has grounds for insecurity as to Seller’s performance, then Seller shall provide adequate assurance of due performance within seven (7) days after Buyer demands the assurance, which shall be considered to be a reasonable time. If at any time (i) Seller defaults in the performance of any of Seller’s obligations to Buyer under the Agreement or under any other agreement between Seller and Buyer and Seller fails to cure the default within a reasonable time after Buyer provides notice of the default to Seller, (ii) Seller repudiates the Agreement, or (iii) any warranty or representation that Seller shall have made to Buyer in or in connection with the Agreement is false or misleading in any material respect, then Buyer may terminate the Agreement, in whole or part, without liability to Seller, and Seller shall promptly pay to Buyer all damages that Buyer incurred as a result of the termination and as a result of the event or circumstance on the basis of which Buyer terminated. If Buyer does terminate the Agreement, then Seller (i) shall, unless Buyer directs otherwise, stop work and acquisition of materials under the Agreement and protect property in Seller’s possession in which Buyer has or may acquire an interest for a reasonable period of time sufficient to allow Buyer to provide for the disposition of the property and (ii) if and to the extent that Buyer demands, shall immediately deliver to Buyer all finished and unfinished goods and all work-in-process and raw materials that Seller acquired for use in the manufacture or processing of the goods and all designs, drawings, specifications, formulas and recipes related to any goods that Buyer is purchasing from Seller under the Agreement, all intellectual property rights in the foregoing. Termination under this Section shall terminate only Seller’s obligation and right to deliver goods or provide services under any provision of the Agreement other than this Section and shall not terminate or impair Seller’s other obligations, or any of Buyer’s rights, under the Agreement. In addition to Buyer’s rights described in these Terms and Conditions, Buyer has all of the other rights and remedies that the law gives to buyers. Buyer shall not lose any right just because it does not exercise it. BUYER’S DAMAGES FOR ANY BREACH BY SELLER (WHETHER OR NOT BUYER TERMINATES THE AGREEMENT BY REASON OF THE BREACH) FOR WHICH SELLER IS LIABLE, INCLUDE, ALL DAMAGES SUFFERED BY BUYER AS A RESULT OF SUCH BREACH, INCLUDING WITHOUT LIMITATION, ANY COST OF “COVER” OR OF COMPLETING THE MANUFACTURE OR PROCESSING OF THE GOODS, AS WELL AS ALL INCIDENTAL, CONSEQUENTIAL, LOST PROFITS AND OTHER DAMAGES (INCLUDING ACTUAL ATTORNEY FEES).
13. INSOLVENCY. Buyer may immediately cancel the Agreement or any Order without liability to Seller in the event of the happening of any of the following or any other comparable event: (a) insolvency of the Seller; (b) filing of a voluntary petition in bankruptcy by Seller; (c) filing of an involuntary petition in bankruptcy against Seller; (d) appointment of a receiver or trustee for Seller, or (e) execution of an assignment for the benefit of creditors by Seller, provided that such petition, appointment or assignment is not withdrawn, vacated or nullified within fifteen (15) days of such event.
14. BUYER’S PROPERTY. Any designs, drawings, recipes, specifications, intellectual property, documents and other information Buyer furnishes to Seller in connection with Seller’s manufacture of the goods or performance of the services (“Buyer Property”) are and shall at all times be Buyer’s sole and exclusive property. While in Seller’s possession, Seller shall (a) preserve and protect all Buyer Property, (b) bear the risk of loss with respect to any Buyer Property, (c) refrain from using any Buyer Property for any purpose other than fulfilling its obligations to Buyer, and (d) turnover all or any portion of Buyer Property to Buyer upon demand. If Seller breaches or threatens to breach this Section of these Terms and Conditions, then Buyer’s remedies at law will be inadequate. Therefore, Buyer shall have the right of specific performance or injunctive relief, or both, in addition to any and all other remedies and rights at law or in equity, and Buyer’s rights and remedies shall be cumulative.
15. INTELLECTUAL PROPERTY AND OTHER PROPRIETARY RIGHTS. All inventions (whether or not patentable), devices, technologies, recipes, ideas, improvements, processes, systems, trademarks, trade names, trade dress, service marks, names, and other works and matters that Seller creates or develops in the course of Seller’s performance of the services or Seller’s design or development of the goods for Buyer, including all proprietary rights in the foregoing (“Intellectual Property”) shall be Buyer’s sole property, and Seller hereby assigns, and agrees to assign, to Buyer all right, title and interest that Seller now has or in the future acquires in the Intellectual Property. Seller hereby assigns, and agrees to assign to Buyer, all right, title and interest that Seller now has or in the future acquires in all copyrightable works that Seller creates or develops in the course of Seller’s performance of the services or Seller’s design or development of the goods for Buyer whether considered a “work made for hire” within the meaning of the common or civil law of Canada. If the goods or their design are subject to any pre-existing patent rights or other proprietary rights that Seller holds, then Seller grants to Buyer an irrevocable, perpetual, non- exclusive, royalty-free license of the patent rights and other proprietary rights to the extent necessary to enable Buyer to modify, repair or rebuild any or all of the goods. This license is in addition to all licenses impliedly granted to Buyer as a purchaser of the goods. Seller shall not use Buyer’s name or any trademark, trade name, service mark or trade dress that Buyer owns or that is licensed to Buyer or to any Affiliate of Buyer, without Buyer’s express, written consent, and Seller shall not sell to anyone other than Buyer any goods bearing any such trademark, trade name, service mark or trade dress. If Seller is required to manufacture and sell to Buyer any GFS Private Branded Goods, then Buyer grants a non-exclusive, non-transferable license to Seller to use Buyer’s trademarks for the sole purpose of the manufacture and sale of such private-branded goods to Buyer. In that case, Seller shall use the trademarks only in the form, manner, and with the appropriate legends, as prescribed from time to time by Buyer. Seller shall not, however, sell any of Buyer’s private-branded goods to any third party (including, but not limited to, employees or the public through Seller’s company stores). Seller shall indemnify and hold Buyer, its agents and employees, harmless from any claim of infringement of a patent, copyright, trademark, trade name, or other proprietary right or claim of unfair trade or of unfair competition, arising out of the manufacture, sale or use of the goods sold pursuant to any Order. Upon termination of this Agreement for any reason, Seller shall immediately cease all use of the Intellectual Property and shall immediately turnover to Buyer all Intellectual Property upon demand. If Buyer and Seller have signed a separate agreement that addresses some or all of the subject matter of this Section, then both the other agreement and this Section shall be effective, but if there is a direct conflict between them, then the conflicting provision of the other agreement shall control.
16. CONFIDENTIALITY OF FURNISHED INFORMATION. Seller agrees that any technical information disclosed to Buyer in connection with the goods covered by any Order is not confidential and Seller will not assert any claim (other than one for patent infringement) against Buyer with respect to that information. Any technical information disclosed by Buyer to Seller is confidential and Seller agrees not to use or disclose any such information without prior written consent of Buyer. Seller shall not sell or offer to sell or otherwise provide to anyone other than Buyer any goods made in accordance with any designs, drawings, specifications, standards, performance criteria or other requirements that Buyer furnishes to Seller or that incorporate, embody or are made in accordance with any of Buyer’s intellectual property. Seller shall maintain the confidentiality of, and shall not disclose or use or permit to be disclosed or used or to be viewed by any third party (including any of Seller’s suppliers), the goods, any designs or drawings of or specifications, technical information, standards, performance criteria or other requirements for the goods or services, any Buyer Property or any information concerning Buyer’s business, operations or activities, including, without limitation, information concerning Buyer’s present or proposed products, product developments, plans, strategies, finances, know-how, sales, customers, marketing or sales techniques, or the existence of the order or the Agreement or that Seller will sell, or has sold, or has agreed to sell, goods or services to Buyer (“Confidential Information”), provided, however, that Seller may disclose Confidential Information (a) to a third party (other than a competitor of Buyer or a subsidiary or affiliate of a competitor) to the extent disclosure is necessary in order for Seller to perform its obligations under the Agreement if, prior to any such disclosure, Seller obtains from the third party a written statement, in a form pre-approved by Buyer, that the third party agrees to be bound by the confidentiality obligations of this Section of these Terms and Conditions to the same extent as Seller, (b) to the extent necessary to enforce its rights under the Agreement or to defend a claim arising under the Agreement, and (c) as required by applicable law and, provided further , that Confidential Information shall not include (i) information that is or becomes generally known in the industries in which Buyer or Seller operate other than as a result of disclosure by Seller, (ii) information that is disclosed to Seller by a party that, to Seller’s actual knowledge, is not under a legal or fiduciary duty to Buyer not to disclose the information, and (iii) any information that Buyer acknowledges in writing is not confidential. If Seller breaches or threatens to breach this Section of these Terms and Conditions, then Buyer’s remedies at law will be inadequate. Therefore, Buyer shall have the right of specific performance or injunctive relief, or both, in addition to any and all other remedies and rights at law or in equity, and Buyer’s rights and remedies shall be cumulative. If Buyer and Seller have signed a separate agreement that addresses some or all of the subject matter of this Section, then both the other agreement and this Section shall be effective, but if there is a conflict between them, then the conflicting provision of the other agreement shall control.
17. GOVERNMENT CONTRACTS. If Buyer will use the goods or services in connection with a contract with the Canadian, United States or other government, then all terms and conditions that the government contract or any law or regulation requires to be included in any contract formed pursuant to the order (“Government Terms”) are incorporated in the order by reference, if applicable, including but not limited to, regulations which prohibit discrimination against (1) any employee or applicant because of race, color, religion, sex, or national origin, (2) qualified protected veterans and (3) qualified individuals on the basis of disability, and requires affirmative action by covered prime contractors and subcontractors to employ and advance in employment qualified protected veterans and qualified individuals with disabilities. If any provision of the order is inconsistent with any Government Terms, then the Government Terms shall control.
18. INSURANCE. Seller shall maintain in effect, at Seller’s expense, the following minimum insurance coverages:
Commercial General Liability. Seller shall maintain in effect, at Seller’s expense, commercial general liability insurance coverage that will protect Seller and Buyer from any and all claims and liabilities for property damage, personal injury, death or economic damage, to any person, that arises from the Seller’s goods, their use or consumption or the performance of the services or any activities connected with the goods or services. The following limits must be maintained by Seller:
$5,000,000 occurrence and aggregate for Sellers who provide food items for consumption or powered food equipment;
$2,000,000 occurrence and aggregate for Sellers who provide non-food items or provide services.
Worker’s Compensation and Employers Liability. Seller shall maintain in effect, at Seller’s expense, workers’ compensation and employers liability insurance coverage.
Auto Liability. Seller shall maintain in effect, at Seller’s expense, auto liability coverage with a limit of $1,000,000.
The above limits may be achieved by a combination of primary coverage and umbrella coverage. All insurance that this Section requires shall be of the types and in amounts, and shall contain endorsements, and shall be issued by insurers having an A.M. Best financial rating of “A” or better. Carriers with a rating less than “A” must be approved by Buyer. Seller shall cause GFS and each of its Affiliates and related companies, and their respective directors, officers, employees and agents to be named as additional insureds under any or all of the policies evidencing the insurance. Seller shall furnish to Buyer certificates of insurance evidencing any required insurance (a) as part of any initial quote or bid to sell goods or services to Buyer, (b) prior to commencement of any work by Seller for Buyer or at Buyer’s premises, and (c) annually thereafter upon renewal of the insurance coverage.
19. WORK ON PREMISES. If Seller’s performance of services or delivery or installation of goods involves operations by its employees or subcontractors on Buyer’s premises or the premises of a customer of Buyer, then (a) Seller shall at all times enforce strict discipline and maintain good order among all persons engaged in the activity on the premises and shall cause them to comply with all fire prevention, health, environmental and safety rules and regulations in force at the premises, (b) Seller shall comply with any special work conditions that are attached to the order, and (c) Seller’s performance of the services shall not interfere with Buyer’s use of the premises or pose any danger to Buyer’s employees or invitees.
20. SERVICES. With respect to any services, (a) Seller is an independent contractor, and neither Seller nor any of Seller’s employees or agents shall be considered agents or employees of Buyer, and (b) Seller shall furnish or obtain, at Seller’s expense, all labor, materials, equipment, transportation, facilities, permits, licenses, bonds and other items that are necessary to perform the services.
21. UNSAFE OR UNFIT GOODS. If a governmental agency declares that any of the goods or any ingredient of, or any material included in, any of the goods or any packaging or supplies used in connection with the goods, or if Buyer at any time believes in good faith that any of the goods or any such ingredient, material, packaging or supplies, (a) is or may be adulterated, mislabeled, or misbranded (b) is or may be a misbranded hazardous substance or a banned hazardous substance within the meaning of any hazardous substance regulations or laws, (c) does not or may not conform with an applicable consumer product safety standard, or has been declared a banned hazardous product, (d) has a reasonable probability of causing serious adverse health consequences or death to humans or animals, within the meaning of applicable bioterrorism laws, or (e) is or may be otherwise unsafe or unfit for the intended use of the goods, or, if Seller receives any correspondence or other information that would reasonably lead Seller to conclude that any of the declarations set forth as items (a) – (e) above are substantially likely to be forthcoming, then, without limiting other rights and remedies that are available to Buyer under these Terms and Conditions or applicable law, (i) Buyer or Seller, as the case may be, shall give the other party written notice of any such declaration or potential declaration, as applicable, and shall furnish to such party copies of the declaration and of all relevant notices, documents and correspondence, (ii) if a declaration has been issued, Seller shall stop including the ingredient or material in the goods, (iii) if Seller has failed to produce the goods in accordance with Buyer’s specifications and such failure is the reason for the declaration or potential declaration, as applicable, Buyer may terminate the Order, without liability to Seller, by giving written notice to Seller, which shall be effective immediately or on any later date that the notice specifies, (iv) if Buyer does terminate, then (A) Buyer’s obligations under the Order shall terminate immediately and Buyer shall not be obligated to pay Seller damages or other compensation by reason of the termination; and (B) Seller shall, unless Buyer directs otherwise, stop work and acquisition of materials under the Order and protect property in Seller’s possession in which Buyer has or may acquire an interest for a reasonable period of time, (v) Buyer shall have the right (A) with the consent of Seller (which shall not be unreasonably withheld, conditioned, or delayed), to recall (i.e. purchase or repurchase) any or all of the goods, and any products made with or produced by the goods, from its customers and end-users and any others having possession of the goods, and Seller shall reimburse Buyer for all reasonable costs that Buyer incurs in doing so and shall assist Buyer and any applicable governmental agency in all reasonable respects in the recall, to the extent that Buyer requires Seller to do so; and (B) to return to Seller, at Seller’s expense, all such goods, packaging or supplies that Seller shall have previously delivered to Buyer and to require Seller to refund the price to Buyer, whether or not Buyer would then have the right under applicable law to reject or to revoke acceptance of those goods, packaging or supplies, (vi) to the extent that Buyer requests, Seller shall reasonably assist Buyer in any or all aspects of a recall, including, without limitation, developing a recall strategy and preparing and furnishing reports, records and other information; and (vii) Seller shall pay to Buyer an amount equal to all damages that Buyer incurs by reason of the declaration by the governmental agency and/or such good faith belief by Buyer and any resulting recall or delay in performance or return of goods to Seller and/or any termination of the Agreement by Buyer. Buyer shall have the right to cancel Orders for goods that are (1) subject to a recall, (2) produced at a facility that has received an unacceptable plant audit report, or (3) produced at a facility whose government registration has been, or is reasonably expected to be, suspended. Buyer’s right to cancel set forth in the immediately preceding sentence extends to all goods affected by the applicable event and to unrelated goods that come from the same facility.
22. EXPORT AND IMPORT REQUIREMENTS: DRAWBACK AND REFUND RIGHTS. Seller shall prepare, maintain and, to the extent that applicable law, regulation or customs authority requires it to do so, submit to the applicable customs authorities, all information and documentation that is necessary to comply with the applicable customs and export and import requirements of each country from which the goods will be exported and each country into which they will be imported, and Seller shall comply with all other applicable customs requirements. Whenever Buyer requests it to do so, Seller shall promptly furnish to Buyer copies of that information and documentation. Seller is solely responsible for complying with all technical compliance and country of origin requirements of each country into which the goods are to be imported. Seller assigns and transfers to Buyer all transferable customs duty and tax drawback or refund rights relating to the goods, including rights developed by substitution and rights that Seller acquires from its suppliers. Seller shall promptly inform Buyer of each such right and, upon Buyer’s request, shall promptly provide to Buyer all documents and information that are required for Buyer to obtain each such drawback and refund. For goods imported into Canada, prior to shipment, Seller shall provide to Buyer a Certificate of Origin, Canada Customs Invoice, Commercial Customs Invoice, and/or all other applicable documentation required by applicable laws, including without limitation any applicable international trade agreements, complete with purchase order number(s). If Buyer determines that, in connection with Buyer’s purchase of any goods or services from Seller under the Agreement, Buyer is required under any federal, provincial, state, local or foreign laws, regulations, standards, and/or orders to (a) implement a foreign supplier verification, or similar, program or (b) take any action in furtherance of obtaining verification or certification that Seller is in compliance with federal, state, local and/or foreign laws, regulations, standards and/or orders, then Buyer shall have the right to terminate the Order giving rise to such requirement, without any liability to Seller. If Buyer does not terminate the Order, then Seller shall (1) use commercially reasonable efforts to assist Buyer in implementing the program and obtaining all applicable verifications and certifications (including, without limitation, providing Buyer, at Seller’s expense, with all the information in Seller’s possession, or that Seller can obtain with commercially reasonable efforts, that Buyer needs to implement the program and obtain the verifications and certifications) and (2) reimburse Buyer for all expenses reasonably incurred by Buyer in implementing the program and obtaining the verifications and certifications. Additionally, if Buyer determines that any of the goods Buyer orders from Seller are eligible for any voluntary importation program that would allow for the expedited importation of the goods into the United States under any federal, state, local or foreign laws, regulations, standards, and/or orders, then Seller shall (1) use commercially reasonable efforts to assist Buyer in qualifying for the program (including, without limitation, providing Buyer, at Seller’s expense, with all the information in Seller’s possession, or that Seller can obtain with commercially reasonable efforts, that Buyer needs to qualify for the program) and (2) reimburse Buyer for all expenses reasonably incurred by Buyer in qualifying for the program.
23. SELLER’S PURCHASE OF GFS PRIVATE BRAND PACKAGING INVENTORY. Seller agrees to purchase and maintain a sufficient quantity of GFS Private Brand labeled packaging inventory during the term of this Agreement for GFS Private Branded Goods. In the event this Agreement is terminated for a reason other than Seller’s breach prior to expiration, Buyer shall purchase from Seller up to a four (4) week inventory (based on average weekly movement) then in Seller’s possession allocated between (i) empty and unused GFS Private Branded Goods packaging at Seller’s cost and (ii) finished goods. Forecasts provided by Buyer, if any, shall be non-binding.
24. RECORDS. Seller shall maintain complete and accurate records of all transactions and activities of Seller that relate to Seller’s sales of goods and services under the Agreement and shall permit Buyer and its agents, upon reasonable prior notice, to enter Seller’s premises during Seller’s normal business hours to inspect the facility and those records that are reasonably asked for and are reasonably available, to the extent that Buyer believes in good faith that an inspection and/or audit of the facility and/or records is necessary to determine whether Seller is complying or has complied with its obligations under the Agreement.
25. SECURITY INTERESTS. Seller shall not have and waives, and shall not file or record any document claiming, any security interest in or lien (including any statutory or common law lien) upon any Buyer Property or the goods.
26. RELATIONSHIP OF PARTIES; BROKERS. The relationship between Seller and Buyer is and will be that of seller and buyer and not a joint venture, partnership, principal-agent, broker, sales representative or franchise relationship, unless expressly provided in another agreement between the parties. The parties expressly acknowledges that any broker engaged as part of the business relationship between Buyer and Seller is and shall always be an agent of Seller and Buyer shall have no responsibility to, or control over, such third party broker.
27. SEVERABILITY. If any provision of these Terms and Conditions, the Agreement or any Order is invalid or unenforceable, all other provisions of this Agreement shall remain in full force and effect.
28. NOTICES. Any notice or other communication that is required or permitted under the Agreement shall be in writing and shall be effective (a) when personally delivered or sent via telecopy or electronically to a facsimile number or an email address specified in the order, (b) the next business day after delivery to a nationally-recognized overnight delivery service designated for next business day delivery with all charges prepaid, or (c) three (3) days after mailing if sent by certified mail, return receipt requested, postage prepaid, addressed to Buyer or Seller, as applicable, at its address specified in the order or to another address that a party shall specify to the other by written notice, except that a notice or other communication may be given orally, including by telephone, if it is confirmed by written notice given the same day.
29. TERMINATION. Buyer may terminate the Agreement at any time as to all or any part of the undelivered goods, for any reason. If Seller is not at fault Buyer agrees to pay termination charges limited, however, to the cost of labor and materials for producing goods under that Order incurred by Seller prior to the time Buyer notifies Seller of termination, less any net recovery to Seller on disposition or other use of the goods (and subject to any setoff rights of Buyer which may exist). Seller shall use its best efforts to mitigate its damages under this paragraph. Expiration or termination of this Agreement shall be without prejudice to the rights of either party under this Agreement or pursuant to any default or breach under this Agreement that occurred prior to the date of termination. The expiration or termination of this Agreement shall not affect any of the provisions of this Agreement that by their nature are intended to continue after termination.
30. REMEDIES; NO IMPLIED WAIVER. The remedies in this Agreement and any Order shall be cumulative and in addition to any other remedies allowed to Buyer under applicable law. The failure of either party at any time to require performance by the other party of any provision of this Agreement or any Order shall in no way affect the right to require such performance at any time thereafter, nor shall the waiver of either party of a breach of any provision of this Agreement or any Order constitute a waiver of any succeeding breach of the same or any other provision.
31. LIMITATION OF DAMAGES. TIME PERIOD TO COMMENCE ACTION. BUYER SHALL NOT BE LIABLE FOR ANY INCIDENTAL, CONSEQUENTIAL, INDIRECT OR ANY OTHER SPECIAL DAMAGES OF SELLER, INCLUDING BUT NOT LIMITED TO LOST PROFITS OR SELLER’S ATTORNEY FEES. EXCEPT FOR ANY ACTION RELATED TO DISCREPANCIES IN AMOUNTS PAID OR DEDUCTED, WHICH ACTIONS MUST BE BROUGHT WITHIN 180 DAYS OF THE DATE OF SUCH PAYMENT OR DEDUCTION, ANY ACTION AGAINST BUYER ARISING OUT OF THE AGREEMENT, ANY ORDER, OR THESE STANDARD TERMS AND CONDITIONS MUST BE FILED WITHIN ONE (1) YEAR AFTER THE CLAIM ACCRUES.
32. SET OFF. Buyer or its affiliates have the right to set off any sums due to Seller under any Order or Agreement against any sums due from Seller to Buyer or its affiliates for damages, refunds or otherwise, whether or not those sums are due to Buyer or its affiliate under that Order or Agreement.
33. ASSIGNMENT. Seller shall not assign its rights or delegate, subcontract or assign its duties under these Terms and Conditions or any Order or Agreement without Buyer’s prior written consent, which may be withheld for any reason. Buyer’s consent to Seller’s delegation, subcontracting or assignment of any obligation of Seller under the Agreement shall not relieve Seller of responsibility or liability for performance of the obligation.
34. SUCCESSORS. The terms of the contract evidenced by this Agreement or any Order shall inure to the benefit of and be binding on the successors and assigns of the parties.
35. GOVERNING LAW. Unless otherwise stated on the face of this Agreement or any Order, shall for all purposes be construed and interpreted according to the laws of the Province of Alberta and the federal laws of Canada applicable therein, excluding reference to conflicts of laws principles. Neither the Uniform Commercial Code nor the United Nations Convention for the International Sale of Goods shall apply this this Agreement or any Order.
36. JURISDICTION AND VENUE. Seller and Buyer agree that any action arising out of the sale of goods in accordance with this Agreement or any Order will be brought, heard and decided exclusively in the courts in the Province of Alberta. Seller submits to personal jurisdiction in the Province of Alberta, and acknowledges that such venue is proper and appropriate.
37. SUBSEQUENTLY ACQUIRED ENTITIES, DIVISIONS, OR PRODUCT LINES. Buyer shall have the option, in its sole discretion, to include within the scope of this Agreement any entities, divisions or product lines acquired by Seller during the time period that this Agreement remains in effect. Further, should Buyer or any of its affiliate acquire the business or assets of a third party who has an existing agreement with Seller, or be acquired by such a third party, Buyer and its affiliates shall have the option purchasing goods pursuant to either agreement at Buyer’s and its affiliates’ exclusive discretion.
38. LANGUAGE. The parties have requested that this document be drafted in English. Les parties ont demandés que ce document soit rédigé en anglais.