Recycling Equipment Inc. Terms and Conditions of Sale

The following terms and conditions apply to the purchase of equipment, parts and/or services from Recycling Equipment Inc. (“REI”). Definitions for those certain capitalized terms are set forth in Section 22 below.

1. Terms and Conditions Binding; Entire Agreement. Unless and to the extent otherwise specified in the proposal, quotation or sales order, of which this document is part (the “Proposal”), the following terms and conditions shall apply to this proposal and to any order or contract resulting from this proposal. The Proposal is an offer to sell equipment and/or spare parts and any services to Buyer. The Proposal is expressly conditioned upon Buyer’s acceptance of these Terms and Conditions. No amendment of these Terms and Conditions, whether such amendment is inconsistent with, different from or in addition to, these Terms and Conditions, will be binding upon REI unless specifically agreed to in a writing signed by REI. No action, inaction or course of dealing by or on behalf of REI shall be deemed an acceptance or agreement of any other term in any other document relating to the subject matter herein. Buyer may accept the Proposal by executing and delivering to REI a copy of the Proposal or submitting a purchase order that specifically conforms to or references the Proposal, thereby creating a contractual agreement (the “Agreement”). The Agreement constitutes the entire agreement between REI and Buyer regarding the subject matter herein and supersedes all prior and contemporaneous agreements between such Parties, whether written or oral, with respect to such subject matter.

2. Delivery Terms; Delivery Dates; Title and Risk of Loss; Inspection and Damage. Except as otherwise specified in the Proposal, delivery will F.O.B. point of shipment and all risk of loss passes to the Buyer upon shipment. Time of delivery is an estimate only and is subject to abnormal conditions of manufacture and supply. REI shall in no event be liable for any alleged damages, expenses, or losses for any delay however and by whomsoever caused, and no order or contract resulting here from shall be cancelable on account of any delays caused by fires, acts of God, strikes, labor difficulties, acts of governmental or military authorities, delays in transportation or procuring materials, or causes of any kind beyond the Company’s control. Buyer may request REI to prepay freight, in which case Buyer shall pay REI a handling charge equal to 10% of total freight charges; provided, however, that any such prepayment by REI shall not in any way affect title or risk of loss to the Equipment as set forth in this Section. Buyer shall inspect the Equipment upon receipt thereof and immediately report any shortage or damage to REI and the carrier. REI shall file any claims for any shortage or damage with the carrier upon immediate notice by Buyer. If Buyer fails to report any claim for shortages or damage within Fifteen (15) days after Buyer’s receipt of the Equipment, such failure shall constitute a waiver of Buyer’s rights of inspection and rejection; For all REI Equipment shipped by and at the direction of Buyer, the Buyer shall be responsible for all creation and supplying of all shipping documents to REI necessary to allow and perfect delivery to Buyer’s destination. Risk of loss to the Equipment passes from REI to Buyer at the time the Equipment has been picked up by Buyer’s carrier pursuant to this Section. Buyer shall inspect the Equipment upon receipt thereof and immediately report any shortage or damage to REI and the carrier. Buyer shall file any claims for any shortage or damage with the carrier. If Buyer fails to report any claim for shortages or damage within Fifteen (15) days after Buyer’s receipt of the Equipment, such failure shall constitute a waiver of Buyer’s rights of inspection and rejection.

3. Technical Documentation. Timely performance by REI is contingent upon Buyer’s supplying to REI, upon request, all required technical information, including, without limitation, drawing approval and all required commercial documentation. Any technical documentation, drawings, brochures or catalogs provided to Buyer by REI, and all of REI’ Technology, are the property of REI and such materials do not alter or amend the terms and conditions set forth in these Terms and Conditions. REI reserves all property rights in and of such documentation and/or Technology. Without REI’ prior written consent, any such REI documentation and/or Technology shall not be: (i) disclosed, in whole or in part, to any other person; (ii) used for any purpose other than those for which they have been provided to Buyer; or (iii) used for the manufacture of any duplicate or similar equipment or parts by Buyer or any other person.

4. Cancellations. The Agreement is not subject to unilateral change or cancellation by Buyer. If Buyer fails to comply at any time with any payment terms in the Agreement, and upon receipt of written notice (“Notice”) sent by REI, including by email communication with an officer or principal of Buyer, and such failure to pay continues for thirty (30) days after date of said Notice, then REI shall have the right to cancel the Agreement, and upon such cancellation shall have no further duties or obligations to Buyer hereunder. Buyer agrees that upon cancellation by REI under this Section all monies paid to date by Buyer are nonrefundable. REI reserves the right under this Section to pursue any and all outstanding monies due and owing, including, but not limited to, REI’ costs, losses and anticipated profits relating to such cancellation. In the event REI pursues collection under this Section, Buyer agrees that REI is and shall be entitled to recover its costs and reasonable attorney’s fees incurred in the enforcement of this Section.

5. No Removal of Safety Devices. Buyer covenants that under no circumstances will Buyer remove any safety equipment, devices, guards, warning/safety labels or notices from the Equipment. Violation of this Section by Buyer shall result in any and all warranties being deemed null and void, and Buyer agrees REI shall have no liability whatsoever to Buyer for any losses, damages or injury caused by or resulting from Buyer’s removal of such safety devices or from Buyer’s violation of this Section.

6. Ownership of Technology/Improvements. REI shall retain exclusive ownership of all right, title and interest in and to all REI Technology and Improvements. REI’ sale of the Equipment hereunder does not grant or convey to or confer upon Buyer or any other person any license of any kind, express or implied, for or in connection with any REI intellectual property rights.

7. Confidentiality. At all times after the Agreement is formed, Buyer shall: (i) maintain the Confidential Information in strict secrecy by utilizing the same degree of care as Buyer utilizes for maintaining the confidentiality of its own confidential or proprietary information (which in no event shall be less than reasonable care); (ii) not use the Confidential Information in any way, in whole or in part, except as is necessary for Buyer to operate, maintain or repair the Equipment and for no other purpose of any kind; (iii) not publish or disclose the Confidential Information in any way, in whole or in part, to any person.

8. Security Agreement. If REI and Buyer agree in the Proposal that the Equipment shall be tendered to Buyer prior to payment in full of all amounts due and owing to REI for the Equipment (any such amounts due and owing shall be hereinafter referred to as the “Purchase Money Obligation”), then to secure the Purchase Money Obligation, Buyer hereby grants to REI a security interest in each item of Equipment (hereinafter “Collateral”). For purposes of this Section, “Collateral” means the Equipment, wherever located and whether now owned or hereafter acquired, together with all present and future attachments, accessions, replacements, additions, products, and proceeds (including insurance proceeds) thereof. At no point until title to the Equipment fully vests in the Buyer and all Security Interests are extinguished shall the Equipment be considered an accession to any real estate property. Buyer hereby authorizes REI to file such financing statements as REI, in its sole discretion, may determine to be desirable to perfect such REI purchase money security interest in the Collateral, and Buyer agrees to fully cooperate with REI and to execute any and all documents and instruments reasonably requested of Buyer to perfect such REI security interest. Buyer hereby irrevocably appoints each REI officer as its attorney-in-fact for the purpose of executing financing statements or similar documents to implement this provision. REI may, and Buyer shall, at any and all times notify any other person claiming a security interest in Buyer’s assets or inventory of this purchase money security interest. Buyer will pay when due the Purchase Money Obligation to REI and will repay immediately on demand the cost of filing financing statements and any renewals or extensions thereof incurred by REI in connection with the Purchase Money Obligation. Upon Buyer’s failure to pay the Purchase Money Obligation when due, REI shall have the right to and may pursue any and all legal or equitable rights or remedies available to a secured creditor under the applicable provisions of the Uniform Commercial Code.

9. Severability. If any provision herein is determined by an Authorized Court (Section 19 hereof) to be invalid, illegal or unenforceable, such provision shall be automatically reformed and construed so as to be valid, legal and enforceable to the maximum extent permitted by applicable law. The invalidity, illegality or unenforceability of any part of the Agreement shall not render invalid the remainder of the Agreement.

10. Taxes. The purchase price set forth in the Proposal shall be paid without deduction or withholding for any Taxes levied with respect to such purchase price. All Taxes, when applicable, will be the sole obligation of Buyer and will be paid by Buyer directly to the applicable Government Authority, unless prohibited by law, in which case Buyer shall timely pay such Taxes to REI for remission to the appropriate Government Authority.

11. Credit Sales. REI reserves the right to withdraw credit and require full payment before production, shipment or delivery if REI, in its sole discretion, determines that Buyer’s financial condition does not merit REI’ extension of credit. A finance charge of 1% per month will be assessed on all past due balances. If such finance charge exceeds the maximum rate allowed by applicable law, then such finance charge shall be deemed to be reduced to equal the maximum rate allowed by applicable law.

12. Collection Costs. In the event Buyer fails to timely remit payment for any transaction with REI, and REI commences any collection activity or action, Buyer shall be liable for all of REI’ collection costs, including reasonable attorneys’ fees and costs associated with the same.

13. Publicity. Buyer hereby consents to REI’ use of Buyer’s name as a reference and customer in REI sales and marketing materials and efforts, including, without limitation, brochures, sales literature and website. 14. Force Majeure. REI’ performance hereunder shall be excused if and for so long as a breach is caused by a Force Majeure and reasonable notice thereof has been given to Buyer. If REI fails to perform hereunder as a result of a Force Majeure, REI shall be required to fulfill its obligations hereunder within a reasonable time after the Force Majeure ceases to exist.

14. Force Majeure. REI’ performance hereunder shall be excused if and for so long as a breach is caused by a Force Majeure and reasonable notice thereof has been given to Buyer. If REI fails to perform hereunder as a result of a Force Majeure, REI shall be required to fulfill its obligations hereunder within a reasonable time after the Force Majeure ceases to exist.

15. Export Controls. The Agreement and all Equipment furnished by REI to Buyer in connection herewith shall at all times be subject to any applicable law, treaty or convention relating to the export, re-export, delivery or transfer from the U.S. of any products that may be imposed from time to time by any Government Authority, including, without limitation, the U.S. Export Administration Regulations.

16. Amendment. The Agreement shall not be amended except by a written instrument executed by an authorized representative of both Parties; provided, however, the Warranty may only be amended in accordance with the provisions found in these Terms and Conditions.

17. Assignment. Buyer may not assign any of its rights, duties or obligations under the Agreement without REI’ prior written consent. REI, however, may freely assign the Agreement to any subsidiary, affiliate or related entity with or without the consent of Buyer, upon thirty (30) days’ prior written Notice to Buyer.

18. Notices. All notices required or permitted hereunder shall be in writing, shall be addressed to the Parties at their respective addresses as set forth in the Proposal, and: (i) Personally delivered (deemed effective upon personal delivery); or (ii)sent by an internationally recognized, commercial overnight delivery service with provisions for a receipt, postage or delivery charges prepaid (deemed effective upon receipt).

19. Choice of Law, Venue. The entire relationship between the parties, including specifically, but without limitation, this Proposal, the contract between the parties, and the equipment or other items sold by REI to Buyer shall be governed by and construed in accordance with the laws of the State of North Carolina. Venue for any legal action arising out of or related to the Agreement and/or these Terms and Conditions (“Dispute”), whether in a court of law, equity, or otherwise, arising out of or related to the Proposal, the contract between the parties, or the equipment or other items sold by REI to Buyer, shall be the Superior Court of Catawba County, North Carolina, and each of the parties expressly consents to such venue and the subject matter and personal jurisdiction of such court. Mandatory forum selection clause. The Parties exclusively and irrevocably consent and submit to the personal jurisdiction and venue of the aforementioned court and agree not to challenge or assert any defense to the jurisdiction or venue of the Authorized Courts, including, without limitation, forum non conveniens. If Buyer commences any action over or for a Dispute in a court other than either of the Superior Court of Catawba County, North Carolina, Buyer shall pay all of REI’ costs and expenses, including attorneys’ fees and court costs, to move such action to the appropriately venued court.

20. Waiver. Failure by either Party to insist upon strict performance of any provision herein by the other Party shall not be deemed a waiver by such Party of its rights or remedies or a waiver by it of any subsequent default by the other Party, and no waiver by either Party shall be effective unless it is in writing and duly executed by such Party.

21. Survivability. The terms and conditions herein shall survive and continue to bind the Parties after the execution and delivery of the Agreement and the expiration or earlier termination of the Agreement, to the extent and for as long as may be necessary to give effect to the rights, duties and obligations of the Parties pursuant to the Agreement, subject to any applicable statute of limitations.

22. Definitions. A. “Buyer” means the Party to whom the Proposal or proposal is addressed (as set forth on the first page thereof); B. “Confidential Information” means all information, in whatever form, relating to any business of REI or any REI affiliate, that is:

i. treated as confidential and/or proprietary by REI or any REI affiliate; and

ii. disclosed by REI or any REI affiliate to Buyer or is otherwise learned, observed or perceived by Buyer, at any time before, on or after the Effective Date in connection with the Agreement;

C. “Effective Date” means the effective date of the Agreement which shall be the date on which REI and Buyer have each agreed upon the terms of, and duly executed, the Agreement;

D. “Equipment” means the equipment, spare parts and/or other products set forth in the Proposal;

E. “Force Majeure” means any event or circumstance beyond REI’ reasonable control that prevents or delays the performance of REI’ obligations hereunder, including, without limitation, natural disasters, wars, riots, sabotage, terrorism government action, lockout, strikes, labor disputes, inability to obtain suitable equipment or components, delay or default by REI’ suppliers, acts of God or fire;

F. “Government Authority” means any foreign, federal, state, local or other government, government agency or authority or quasigovernmental body, including, without limitation, any government department, board, commission, court or tribunal;

G. “Improvement” means any invention, innovation, idea, improvement, trade secret, knowhow or other intellectual property right of any kind, whether or not patentable, that: is made, conceived, developed or reduced to practice by Buyer or by or on behalf of REI, either independently or jointly with any other person; and incorporates, embodies, arises from or relates to, any REI Technology or any Equipment;

H. “Parties” means REI and Buyer;

I. “Person” means any individual, corporation, Government Authority, partnership, limited liability company or any other entity of any kind;

J. “Taxes” means all taxes, charges or other assessments of any kind of any Government Authority (including, without limitation, withholding taxes, sales taxes, use taxes, and any interest, fines, or penalties thereon) levied or based on, directly or indirectly, any purchase price paid hereunder, whether levied against REI, Buyer or any other person. “Taxes” shall exclude any income, franchise or any other similar taxes of any Government Authority payable by REI as to its receipt of any purchase price; and

K. “Technology” means all (both domestic and foreign) patents, patent applications, copyrights, trademarks, service marks, trade names, licenses, mask works, know-how, trade secrets, methods, processes, technologies, inventions, ideas, improvements, concepts, Confidential Information and all other intellectual property rights of any kind, owned by, or licensed to REI or any related or affiliated entity or person.

Warranty Disclosure

23. LIMITED WARRANTY

A. Scope. All equipment quoted on this Proposal is subject to the standard warranty of the manufacturer thereof. The Company provides a repair and replacement warranty as to all equipment manufactured directly by the Company for a period of one (1) year, or Two-ThousandEighty (2,080) operating hours, whichever occurs first. The Company shall not be otherwise liable for defects or short-comings, and no obligation with regard to suitability, capability, performance or compliance with buyer’s specifications is undertaken or is to be implied. The Company shall not, in any event, be liable for any consequential damages, secondary charges, expenses for installing or disconnecting, or losses from any alleged defect in the product. Any changes or improvements may be made at any time, but the Company shall be under no obligation to incorporate same in, or substitute the same for, any products previously sold to any customer. ALL IMPLIED WARRANTIES ARISING UNDER THE UNIFORM COMMERCIAL CODE OR OTHER APPLICABLE LAWS, INCLUDING, BUT NOT LIMITED TO, THE IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE ARE HEREBY EXPRESSLY DISCLAIMED. The Company shall in no event be liable for any alleged damages, expenses, or losses, of any nature or kind, whatsoever, including, but without limitation, actual, estimated, liquidated, unliquidated, incidental or consequential damages, expenses, or losses. Unless expressly stated in the Proposal, Buyer’s sole and exclusive remedy shall be limited to the repair and replacement of non-conforming goods or parts. Remedy may be applied via 1) correcting all such defects in material and/or workmanship by repairing, replacing or modifying the Equipment to comply with the Warranty; or 2) refunding the purchase price paid for the piece or item of defective Equipment. If the Equipment or any component thereof is manufactured by a third-party manufacturer and not REI, then, in addition to the Warranty, Buyer shall also be entitled to obtain the benefit of the terms and conditions of any such other manufacturer’s warranty (if any) from the manufacturer and REI will assign, as necessary, all such warranties to Buyer to the extent such warranties are assignable. However, nothing herein shall be construed as an intention to make Buyer a third-party beneficiary of any contract REI has with any manufacturer or other person, and REI does not intend that Buyer is a third-party beneficiary of any contract, agreement or obligation REI has with any manufacturer or other person.

B. Extension of Warranty. This Warranty is extended by REI solely to Buyer and is not intended to apply to or create rights in any third-party. Any repair, replacement or modification of the Equipment, pursuant to the Warranty, shall not in any way extend the Warranty Period or the Warranty. Buyer is required to:

1. obtain from REI a written return material authorization number, which shall be provided prior to the Equipment being returned to REI; and

2. return the Equipment to the point of manufacture, all at Buyer’s sole cost and expense. Notwithstanding anything to the contrary contained herein, should this exclusive remedy be finally determined by a court of competent jurisdiction to fail of its essential purpose, then REI’ liability to Buyer for the Equipment shall be limited to the aggregate purchase price paid by Buyer for the piece or item of defective Equipment.

D. Labor, Parts and Materials During Warranty Period. During the Warranty Period, all parts and materials to be provided by REI pursuant to the Warranty shall be provided by REI without charge, as provided herein. REI will own all parts removed from repaired Equipment. Buyer understands that REI uses both new and reconditioned parts made by various manufacturers in performing warranty repairs and building replacement products.

E. Exclusions. This Warranty does not cover any Equipment defect occurring: from normal wear and tear, in shipment to or from Buyer or the point of manufacture, due to Force Majeure, or any external cause, fire, accident, problems with electrical power or plant provided facilities or any other cause (other than ordinary commercial application), due to improper handling, installation, maintenance or reasonable care, improper use, use for any purpose or application for which it was not designed or intended, abuse or neglect, by Buyer or any other person (other than REI or REI authorized personnel), due to alteration, modification, connection or repair of any kind, by Buyer or any other person (other than REI or REI authorized personnel), due to improper environment, poor air quality, excessive or inadequate heating or other environmental irregularity, due to abuse from nonconforming materials, due to any addition of any part, component or accessory (or any use thereof) that is added by Buyer or any other person (other than REI or REI authorized personnel) that is not supplied or approved in writing by REI, due to use or operation of the Equipment by Buyer or any other person (other than REI or REI authorized personnel) not in accordance with any Equipment storage, operation, maintenance or repair instructions furnished by REI, or for any operation not in accordance with generally accepted industry practice.

F. No Authority to Alter Warranty. No REI employee, agent, representative or distributor has any authority to alter any of the terms of the Warranty in any way. The Warranty may only be altered in writing by an authorized officer of REI.

24. DISCLAIMER OF OTHER WARRANTIES. A. Except as expressly set forth in these terms and conditions:

1. REI MAKES NO OTHER REPRESENTATION, WARRANTY OR GUARANTEE OF ANY KIND, EXPRESS OR IMPLIED, STATUTORY OR OTHERWISE, ORAL OR WRITTEN, DIRECT OR INDIRECT, TO BUYER OR ANY OTHER PREION; AND

2. REI EXPRESSLY DISCLAIMS ANY AND ALL IMPLIED REPRESENTATIONS, WARRANTIES AND GUARANTEES (INCLUDING, WITHOUT LIMITATION, ANY REPRESENTATION, WARRANTY OR GUARANTEE OF MERCHANTABILITY, OF FITNESS FOR AN ORDINARY, GENERAL OR PARTICULAR PURPOSE, OF QUALITY, OF NON-INFRINGEMENT, AS TO ANY SPECIFICATION, OR FROM ANY COURSE OF DEALING OR USE OF TRADE) WITH RESPECT TO ANY MATTER WHATSOEVER IN CONNECTION WITH THE EQUIPMENT (OR ANY COMPONENT OF OR SERVICE RENDERED WITH RESPECT TO THE EQUIPMENT) OR ITS PERFORMANCE; INCLUDING, WITHOUT LIMITATION, ITS CONDITION OR PERFORMANCE CAPABILITIES OR THE QUALITIES OF ANY PRODUCT OR SERVICE PRODUCED THEREFROM; ITS COMPLIANCE WITH APPLICABLE LAW, OR ANY OTHER MATTER WHATSOEVER RELATING TO THE AGREEMENT.

25. NO CREATION OF WARRANTY. A. ANY ORAL OR WRITTEN STATEMENT, INFORMATION OR ADVICE GIVEN OR MADE BY REI OR ANY OF ITS EMPLOYEES, AGENTS, REPRESENTATIVES OR DISTRIBUTORS:

1. SHALL NOT CONSTITUTE A REI REPRESENTATION OR WARRANTY OR IN ANY WAY INCREASE THE SCOPE OF THE WARRANTY;

2. SHALL NOT BE RELIED UPON BY BUYER OR ANY OTHER PREION; AND

3. IS NOT A PART OF THE WARRANTY.

26 LIMITATION OF LIABILITY NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED HEREIN, BUYER AGREES THAT, UNDER NO CIRCUMSTANCES SHALL REI HAVE ANY LIABILITY OF ANY KIND AT LAW OR EQUITY TO BUYER OR ANY OF BUYER’S AGENTS, EMPLOYEES, ASSIGNS AND/OR RELATED PREIONS, WHETHER IN CONTRACT, TORT OR ANY OTHER THEORY OF LAW OR EQUITY, FOR ANY SPECIAL, INCIDENTAL, CONSEQUENTIAL, PUNITIVE OR OTHER INDIRECT DAMAGES, INCLUDING, WITHOUT LIMITATION: LOST PROFITS, LOST TIME AND CONVENIENCE, COST OF A PRODUCT RENTAL, LOST REVENUES, LOSS OF USE, INTEREST OR CARRYING CHARGES ON INVESTMENT, INDEMNITY, EXPENSES ARISING FROM COSTS OF CAPITAL, REMOVAL OR REINSTALLATION, TRAVEL OR LODGING, UNDERUTILIZATION OF LABOR, EQUIPMENT OR FACILITIES, OR ANY DAMAGES OF ANY KIND COVERED BY INSURANCE HOWEVER CAUSED (EVEN IF REI HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH POTENTIAL LOSS OR DAMAGE).

Terms of payment shall be as follows:

As to all equipment not manufactured by REI:

  • Unless otherwise agreed to by both parties, actual costs of equipment plus REI’s contract administration fee of fifteen percent (15%) of the equipment purchase price shall be due and payable to REI under these terms:

    – 50% at Order Placement

    – 50% at Notification of Ready to Ship

  • The actual costs of shipping and any other charges (i.e. changes to the order) plus REI’s contract administration fee of fifteen percent (10%) of the actual costs not previously billed shall be due and payable, in full, prior to shipment by the manufacturer.

As to all equipment manufactured by REI:

  • Actual costs of purchase will be at REI ‘Dealer Net Pricing’
  • Actual costs of purchase shall be due and payable under REI’s normal equipment terms:

    – 50% at Order Placement

    – 40% Before shipment

    – Net 30 days after Notification of Ready to Ship

Recycling Equipment Inc. By: _____________________________ Its: _____________________________ Date: ___________________ (Buyer company) By: ______________________________ Its: ______________________________ Date: ___________________