Terms & Conditions

VALUE-ADDED SALAD PURCHASE AGREEMENT TERMS & CONDITIONS

1. Sole/Primary Supplier

Each individual agreement between the buyer (“Purchaser”) of branded value-added packaged salad products and Bud Antle, LLC (“Seller”) for sales (each, an “Individual Agreement”) into which these terms and conditions are incorporated, will provide if the Seller will be the sole or primary supplier of branded value-added packaged salad products (“Products”) to the Purchaser.

2. Incentive Purchase Commitment, Extension Periods and Pro-Rata Repayment/Set-Off

(a) Purchaser agrees that in order to receive all Incentives described in each Individual Agreement, it must maintain a quarterly (or yearly) average purchase of the stated number of 12-pack equivalent cases of Products at all times during the Term (the “Incentive Purchase Commitment”). For purposes of this Agreement, two 6-pack cases equal one ‘12-pack equivalent case’. All other case sizes equal one ‘12-pack equivalent case’.

(b) In the event that, for any reason, the number of 12-pack equivalent cases purchased by Purchaser during the Term is less than the aggregate Incentive Purchase Commitment, then at Seller’s option, the Term may be extended for up to one (1) additional quarter (“Extension Period”) in order to allow additional time for the Incentive Purchase Commitment to be met. During an Extension Period, Purchaser shall (i) continue to receive all Volume Incentives; and (ii) not receive any additional Non-Volume Incentives; however, any accrued but unused Non-Volume Incentives may still be used until the conclusion of that extension.

(c) If the aggregate Incentive Purchase Commitment has not been met by the end of the Term (including any Extension Periods), Purchaser shall repay to Seller a pro-rata portion of the Non-Volume Incentives received under this Agreement. At Seller’s option, such amounts may be deducted or set off from any funds payable to Purchaser, without prior notice.

3. Discontinued and Changed Products

Seller reserves the right to discontinue any Product in its discretion. In the event that Seller changes the size, weight or formulation of any of the Products, such changed or reformulated Product shall be considered a new item, to be priced in accordance with an agreement of the parties.

4. Purchaser Incentives

Other than as set forth in an Individual Agreement: (a) incentives based on volume (“Volume
Incentives”) shall be based on purchases of 12-pack equivalent cases and, unless set forth otherwise in the
Individual Agreement, shall be paid on a quarterly basis; (b) incentives not based on volume (“NonVolume Incentives”) shall be paid upon submission of appropriate documentation and evidence of the
qualifying expenditure to Seller; and (c) at the conclusion of the Term, all earned and unpaid Volume
Incentives will be paid to the Purchaser, and all unpaid/unused Non-Volume Incentives will be forfeited
and retained by Seller.

5. Direct and Indirect Purchases; Product Pricing and Payment Terms; Wholesalers

(a) Direct Purchases

(i) Pricing is defined in the Individual Agreement. Terms are generally Net 10 days.

(ii) Products are sold subject to the Perishable Agricultural Commodities Act (PACA) trust provisions.

(iii) Prices may change due to extraordinary events affecting costs or supply.

(iv) Late payments incur 1.5% monthly interest (18% annually). Purchaser pays collection costs.

(v) Certain transferred customer volumes do not count toward incentive commitments.

(b) Indirect Purchases through Wholesalers

(i) Payment for the Products will be made by Purchaser to its supplier or supplier, identified in the Individual Agreement (“Supplier”), at such prices and on such terms as they agree. Supplier shall pay Seller for the Products provided by Seller to Purchaser at the prices determined under the agreement between Supplier and Seller (the “Supplier Agreement”). All of Seller’s obligations to Purchaser under the Individual Agreement, including but not limited to incentives, for indirect sales are conditioned upon timely payments by Supplier to Seller for Product delivered to Purchaser.

(ii)In the event that Purchaser requests invoicing through an intermediary other than Supplier, Seller, in its sole discretion, may approve such an arrangement provided that: (i) the intermediary meets Seller’s credit standards; and (ii) Purchaser guarantees the payment to Seller by the intermediary and remains primarily responsible for all amounts due to Seller for the Products sold under this Agreement.

6. Claims; Recalls and Product Advisories

(a) Claims will be administered in accordance with the terms and conditions governing sales as noted on the Seller’s invoice. All claims must be reported to the Seller’s sales representative within 24 hours of delivery. Deductions, including postaudit deductions, taken later than one (1) year from date of shipment will not be honored. Postaudit documentation must be submitted within nine (9) months of date of shipment.

(b) Notwithstanding anything to the contrary set forth in a Vendor Agreement or designation of charges or penalties to be assessed against Seller in the event of Product withdrawals or recalls, Seller will assume responsibility only for reasonable, direct and documented out-of-pocket costs, expenses, and other losses associated with or resulting from a recall or market withdrawal commenced by Seller of any Product(s), or an involuntary recall or market withdrawal of specific Seller Product(s) mandated by an appropriate regulatory authority, to the extent that the costs incurred by Purchaser deal with the specific Product(s) subject to the recall or market withdrawal, and no other Products. In the event a governmental authority issues a market advisory, warning or similar action that does not specifically target any particular Seller Product sku, but renders any such Seller Product not merchantable by Purchaser, losses will be allocated to Purchaser and Seller according to which party had assumed risk of loss with regard to the Product(s) at the time the advisory, warning or similar action was announced.

7. Acquisition; Merger

(a) Purchaser shall not be entitled to receive Incentives under more than one Individual Agreement with Seller, including but not limited to a circumstance in which Purchaser acquires or is acquired by an entity which already has an Individual Agreement in place that provides for payment of Incentives by Seller. In the event of an acquisition or merger involving an entity that already has an Individual Agreement providing for payment of Incentives by Seller, Purchaser shall either elect to receive all pricing and Incentives under one Individual Agreement or the other, but not both, subject to amendment of the Individual Agreement(s) by the parties.

(b) In the event that Purchaser divests, sells or otherwise closes any of its stores during the Term, or, for wholesale customers, any of its retail purchasers engages in such a divestiture, sale or store closing, the Incentive Purchase Commitment and any other qualification for and amount of any incentive payments hereunder shall not be changed, unless otherwise agreed to by both parties.

8. Termination; Pro-Rata Repayment

(a) This Agreement may be terminated by either party in the event that the other party materially breaches any of its obligations hereunder and fails to cure such breach after thirty (30) days’ written notice. This Agreement may also be terminated by either party in the event that the other party files, or has filed against it, any petition for bankruptcy, reorganization, or similar relief (including an assignment for the benefit of creditors).

(b) If (i) Purchaser terminates this Agreement for any reason other than Seller’s material breach or (ii) Seller terminates this Agreement due to material breach by Purchaser, Purchaser shall reimburse Seller a pro rata portion of the Non-Volume Incentives (if any) paid by Seller under this Agreement, based upon the ratio of actual cases purchased by Purchaser to the aggregate Incentive Purchase Commitment. Such amount may be deducted or set off by Seller from any amounts due from Seller to Purchaser, without prior notice.

9. Notices

All notices under this Agreement shall be in writing and shall be sent by registered or certified mail, postage paid, return receipt requested, by recognized overnight courier service, or personally delivered to the other party at the address listed below. A notice sent by mail shall be deemed delivered on the fourth (4th) business date after the date of posting and a notice sent by overnight courier service shall be deemed delivered on the next business day after delivery of the notice to the courier service.

Seller Address:
Bud Antle, LLC
639 South Sanborn Road
P.O. Box 2570
Salinas, CA 93901
Attn: Chief Legal Officer

Purchaser: As set forth in the Individual Agreement

10. Confidentiality

In the course of performing its obligations under this Agreement, each party may have access to confidential or proprietary information regarding the other party’s processes, business plans, and other confidential matters. Neither party shall disclose to any third parties such confidential or proprietary information received from the other party nor use the other party’s confidential or proprietary information for its own benefit except in connection with the performance of its obligations under this Agreement.

11. Governing Law

This Agreement shall be governed, interpreted, and enforced in accordance with the laws of the State of California and the Perishable Agricultural Commodities Act.

12. Miscellaneous

This Agreement, together with any Individual Agreements made hereunder, set forth the entire Agreement between Seller and Purchaser regarding the subject matter and may be modified only by a written document signed by an authorized representative of each party. This Agreement may not be assigned by Purchaser without Seller’s prior written consent. If any one or more of the provisions contained in this Agreement shall for any reason be held to be invalid, illegal, or unenforceable in any respect, it will not affect the other provisions of this Agreement which shall remain in full force and effect. Neither party shall be deemed to have waived any rights under this Agreement, by course of dealing or otherwise, unless such waiver is given in writing and signed by the waiving party. The language of this Agreement shall, in all cases, be construed according to its fair meaning without regard to the identity of the party who drafted or prepared it, and any ambiguity shall not be construed against either party. The captions contained herein are not part of this Agreement and shall have no effect upon the construction or interpretation of any part hereof.