Rock-Tenn Paperboard, Manufacturer of Recycled and Bleached Paperboard Products: Sales terms and conditions

1. GENERAL: These terms and conditions (“Seller’s Terms and Conditions”) shall apply to any contract for the sale of goods (“Goods”) by Rock-Tenn Company and/or any of its subsidiaries, affiliates or joint ventures (collectively and individually, “Seller”). Seller’s Terms and Conditions shall be incorporated in and deemed a material part of: (a) any bid, quote, response to a request for quote, letter, proposal, or any other form of offer for the sale of Goods (“Proposal”) by Seller to a buyer (“Buyer”), and (b) any form of order acknowledgment by Seller to Buyer (“Order Acknowledgment”). Seller’s Terms and Conditions shall be the only terms and conditions applicable to Buyer’s purchase of Goods pursuant to the terms appearing on the face of the Proposal or Order Acknowledgment (the “Reverse Side”), and shall supersede all prior communications or orders issued by Buyer involving terms and conditions for the sale of the Goods. Seller’s Terms and Conditions shall not be modified or changed without Seller’s written consent. Seller specifically and expressly objects to and rejects any terms and conditions or other provisions in Buyer’s purchase orders, printed forms, correspondence or any other writings which are different from, inconsistent with or in addition to the Seller’s Terms and Conditions or the terms contained on the Reverse Side. Buyer’s efforts to change Seller’s Terms and Conditions or the terms contained on the Reverse Side shall constitute a material alteration of Seller’s Proposal and shall not be binding on Seller. Receipt of Buyer’s purchase order for Seller’s Goods or Sellers initiation of any work to manufacture and supply the Goods identified on the Reverse side shall constitutes acceptance by Buyer of the remaining terms and conditions set forth below.

2. PRICE: The Goods and other items covered by this contract shall be sold and invoiced at the price or prices stated on the Reverse Side. Unless otherwise specified in writhing, the prices set forth in Seller’s Proposal shall expire thirty (30) days from the date set forth on the Reverse Side. If Buyer has not accepted Seller’s Proposal at the stated prices within such thirty (30) day period, Seller reserves the right to adjust its prices for such Goods. If the price is not stated on the Reverse Side, then the price shall be Seller’s price in effect at the time of each shipment of Goods under this contract. Unless otherwise specified in writing, prices do not include federal, state or local sales, excise, use or other taxes now in effect or hereafter levied by reason of this contract. All such taxes shall be paid by Buyer.

3. DELIVERY, TRANSPORTATION AND RISK OF LOSS: Unless otherwise agreed in writing by the parties, all Goods herein sold shall be transported and delivered, as determined by Seller, pursuant to one of the following two alternative methods: (1) FOB Destination. Under this alternative, Seller shall select the method, routing and agency of transportation and shall add the cost of such transportation and delivery to the Buyer’s invoice. Seller shall bear the risk of loss, damage or other incidents of ownership until delivery is made to Buyer’s destination. Any excess packing, shipping or other transportation costs or charges resulting from Seller’s agreement to comply with Buyer’s transportation or delivery requests shall be in addition to the charges set forth above. (b) FOB SELLER’S FACILITY. Under this alternative, all transportation and delivery charges shall be borne by Buyer, as well as all risk of loss and damages. Title to such Goods under this method shall remain with Seller until full and final payment for such Goods has been received by Seller. Upon request, Buyer shall be given the right to select the method, routing and agency of transportation. If the Goods are to be shipped pursuant to Buyer’s shipping instructions and Buyer fails to provide Seller with such shipping instructions by the fourteenth (14th) day after Seller is ready to ship the Goods, Seller shall ship the Goods pursuant to one of the two methods described in this paragraph, as Seller deems appropriate and reasonable. The delivery date set for the Reverse Side is an approximate date of delivery only unless the parties have mutually agreed in writing to a definitive date for delivery. Seller may deliver the Goods within a reasonable time prior to or after the delivery date set forth on the Reverse Side. Seller’s delivery date may be dependent upon Buyer’s timely acceptance or supply of such information or materials necessary for Seller in order to fabricate and ship the order, including but not limited to, proofs or sketches for use in fabricating the Goods. Any delay in accepting or supplying such proofs or sketches shall extend the delivery date. After acceptance of such proofs or sketches, any alterations called for shall be at the expense of Buyer. If Buyer fails or refuses for any reason whatsoever to take delivery of Goods at the designated time of delivery, then Buyer shall be responsible for all reasonable storage fees resulting from such failure or refusal to accept timely delivery. Such storage fees shall be in addition to the price of the Goods. Unless otherwise agreed to in writing, any Goods held by Seller in storage for more than thirty (30) days after the agreed date of delivery may be sold, scrapped or destroyed by Seller without relieving Buyer of the obligation to pay for the Goods and storage.

4. INSPECTION: Buyer shall inspect the Goods at the place of destination within fifteen (15) days after the Goods’ arrival. Buyer must accept any tender of the Goods by Seller substantially in conformity with the terms hereof, subject to Buyer’s remedies set forth in paragraph 8 below. Buyer will be deemed to have accepted tender of the Goods if Buyers fails so to inspect, or fails to give Seller written notice of rejection, within ten (10) days after the Goods’ arrival, which notice shall describe the rejected Goods and the defects upon which Buyer’s rejection is based.

5. PAYMENT: Unless terms to the contrary are set forth on the Reverse Side, payment terms are 1% ten/net 30 days from the date of shipment. All payments shall be made in United States currency. Whenever reasonable grounds for insecurity arise with respect to due performance by Buyer, Seller may demand terms of payment different from those specified herein, and may demand assurance of Buyer’s due performance. Seller may, upon making such demand, suspend production, shipment and/or deliveries. If within the period stated in such demand, Buyer fails or refuses to agree to such different terms of payment and/or fails or refuses to give adequate assurance of due performance, Seller may: (a) by notice to Buyer, treat such failure or refusal as a repudiation by Buyer of the portion of the transaction not then fully performed, whereupon Seller may cancel all further deliveries and any amounts unpaid hereunder shall immediately become due and payable, or (b) make shipments under reservation of a security interest and demand payment against tender of documents of title. If Seller retains a collection agency and/or attorney to collect overdue amounts, all collection costs, including attorney’s fees, shall be payable by Buyer.

6. WARRANTIES: Seller warrants that all goods described on the Reverse Side which are manufactured by Seller will conform to the description on the Reverse Side, subject to variations in paper, paperboard, plastics and color within industry standards and shall be equal in quality to similar Goods manufactured by Seller. Such Goods will be free from defects in material and workmanship and Sellers shall convey good title thereto. SELLER MAKES NO WARRANTY THAT THE GOODS SHALL BE MERCHANTABLE OR FIT FOR ANY PARTICULAR PURPOSE, NOR DOES SELLER MAKE ANY OTHER WARRANTIES, EXPRESS OF IMPLIED, BY OPERATION OF LAW OR OTHERWISE, EXCEPT SUCH AS ARE EXPRESSLY SET FORTH HEREIN. SELLER MAKES NO WARRANTY WITH RESPECT TO GOODS DESCRIBED ON THE REVERSE SIDE WHICH ARE NOT MANUFACTURED BY SELLER.

7. DEFAULT: Buyer shall be in default if (a) Buyer breaches any of its obligations hereunder; or (b) a petition in bankruptcy is filed against Buyer; or (c) Buyer is unable to pay its debts as they become due.

8. REMEDIES AND DISCLAIMERS: All claims for shortages or alleged defects in quality shall be deemed waived unless made in writing promptly after receipt. In no event shall any such claim entitle Buyer to relief if made after Goods have been used, processed or transferred by Buyer. Defective Goods shall be held by Buyer for Seller’s prompt inspection. SELLER SHALL NOT BE RESPONSIBLE OR LIABLE TO BUYER OR TO ANY THIRD PARTY FOR ANY LOST PROFITS, LOSS OF USE, OR INCIDENTAL, CONSEQUENTIAL, INDIRECT, DIRECT, SPECIAL, RELIANCE, PUNITIVE OR CONTINGENT DAMAGES FOR ANY BREACH OF WARRANTY OR OTHER BREACH OF SELLER’S OBLIGATIONS HEREUNDER OR SELLER’S NEGLIGENT CONDUCT IN PERFORMING ITS OBLIGATIONS HEREUNDER. SELLER’S LIABILITY AND BUYER’S EXCLUSIVE REMEDIES ARE HEREBY LIMITED TO SELLER’S CHOICE OF ONE (1) OF THE FOLLOWING REMEDIES: (a) THE REPAIR OF DEFECTIVE GOODS; OR (b) THE REPLACEMENT THEREOF WITH CONFORMING GOODS AT THE FOB POINT PROVIDED HEREIN; OR (c) THE REPAYMENT OF THE PURCHASE PRICE; OR (d) THE GRANTING OF A REASONABLE ALLOWANCE ON ACCOUNT OF SUCH DEFECTS. BUYER SHALL BE ENTITLED TO NO OTHER REMEDIES, WHETHER IN CONTRACT OR TORT OR OTHERWISE, EXCEPT AS PROVIDED HEREIN. UNDER NO CIRCUMSTANCES SHALL SELLER’S LIABILITY EXCEED THE PURCHASE PRICE OF THAT PORTION OF THE GOODS WHICH ARE DEEMED TO BE DEFECTIVE. Replacement of defective Goods or replacement of the purchase price therefor will be made only upon return of defective Goods, which Goods shall not be returned until Seller has consented thereto and has delivered to Buyer written shipping instructions. Seller shall be given reasonable opportunity to investigate all claims and to inspect allegedly defective Goods. Under no circumstances shall Buyer be permitted to set off or credit any amounts due and owing to Seller unless Seller has agreed to such in writing.

9. FORCE MAJEURE DELAYS: Seller’s obligations hereunder shall be excused during the period when any of the following conditions exists: (a) strikes, work stoppages, or other labor troubles or difficulties of any kind; (b) fires, floods, inclement weather, or other acts of God; (c) riots, war, sabotage or other disturbances of the peace; (d) breakdowns, destruction, or failure of any kind of Seller’s equipment or facilities necessary for performance hereunder arising from any cause whatsoever, or accidents at Seller’s plants; (e) transportation delays, reductions, shortages, curtailment or cessation of supplies, materials, equipment, facilities, power, labor, transportation or other factors of production; (f) governmental legislation, regulations, rules or orders, or Seller’s voluntary or involuntary participation in any plan of general public interest, either of which adversely affect manufacture or delivery hereunder; (g) delays of suppliers; or (h) any other cause beyond the reasonable control of Seller, whether or not similar to the causes or occurrences enumerated above. In no event shall Seller, in the event of delays, be liable to Buyer or any third parties for any incidental, consequential, special, direct, indirect, punitive, contingent or reliance damages. In the event of any such delay or failure in performance, Seller shall have such additional time within which to perform its obligations hereunder as may reasonably be necessary under the circumstances. Further, Seller shall also have the right, to the extent necessary in Seller’s reasonable judgement, to apportion fairly among its customers (including Seller’s own fabricating operations, and divisions and affiliates of Seller) in such manner as Seller may consider equitable, the Goods then available for delivery.

10. PIECE SHIPPING TOLERANCES: Unless the parties otherwise agree in writing, Seller shall be entitled to a plus or minus tolerance of ten percent (10%) based on the weight or number of pieces or other unit of measurement of Goods requested by Buyer under each transaction.

11. TECHNICAL INFORMATION: Unless otherwise agreed to by the parties in writing, all (a) drawings, data, specifications, designs, patterns, molds, tools, samples and other items prepared by Seller; and (b) inventions made by Seller, including inventions based on information supplied by Buyer, pursuant to a purchase of Goods, shall be the sole and exclusive property of Seller.

12. CANCELLATION: Buyer may not cancel this contract for the purchase of Goods hereunder without prior written notice to, and the consent of, Seller. In addition, Buyer shall, upon Seller’s acceptance of any cancellation, pay Seller for all completed work for Buyer’s order, all other costs incurred up to the date of cancellation, all lost profits due to the cancellation, and all other reasonable cancellation charges.

13. INSTALLMENT DELIVERIES: Seller shall be entitled to make delivery in installments unless otherwise stated on the Reverse Side. Seller may render a separate invoice for each installment, which invoice shall be paid when due, without regard to subsequent deliveries. Each installment shall be deemed a separate sale. Delay in delivery of any installment shall not relieve Buyer of its obligations to accept delivery of remaining installments.

14. INDEMNITY: To the fullest extent permitted by law, Buyer shall release, hold harmless, indemnify and defend Seller, its officers, agents, employees, affiliates, joint venturers, insurers, successors and assigns, from and against any loss, liability, claims, suits, judgments, decrees, costs and damages (“Damages”) resulting in personal injury or death, Damages to any real or personal property, Damages relating to loss of use or loss of profit and Damages relating to infringement of any United States Patent due to Buyer’s use of the Goods, caused by, arising out of, or relating to Buyer’s purchase, sale, use, possession, or ownership of the Goods or relating to Buyer’s acts or omissions with respect to such Goods. The sale of the Goods shall not grant to Buyer any right or license of any kind under any patent owned or controlled by Seller or under which Seller is licensed, but the foregoing shall not be understood to limit in any way the right of Buyer to use and sell such Goods. In addition, Seller shall release, hold harmless, indemnify and defend Buyer, its officers, directors, employees, affiliates successors and assigns from and against any Damages resulting from infringement of any United States Patents due to the design of Seller’s Goods.

15. MISCELLANEOUS: (A) This contract may be performed and/or assigned, and all rights hereunder against Buyer may be enforced, wholly or in part, by Seller or by any one or more of present or future subsidiaries, affiliates, joint ventures, transferees or assignees of Seller. (B) The waiver by Seller of any terms, conditions, or provisions hereof shall not be construed to be a waiver of any other term, condition or provision, nor shall such waiver be deemed a waiver of a subsequent breach by Buyer of the same term, condition or provision. (C) Neither this contract nor Buyer’s substantive obligations hereunder may be assigned by Buyer except with the prior written approval of Seller. (D) The entire understanding and agreement of the parties with respect to the contract contemplated herein is contained in these Seller’s Terms and Conditions and on the Reverse Side, and any prior understandings, agreements and representations, oral or written, shall be deemed superseded and merged herein. (E) This contract shall be deemed to be made in the state within the United States of America where the Seller’s manufacturing facility is located and shall in all respects be construed and governed by the laws of that state. Any disputes arising out of this contract shall be subject to the exclusive jurisdiction of a court of competent jurisdiction located in a judicial district where the Seller’s manufacturing facility is located. The United Nations Convention of Contracts for the International Sale of Goods shall not apply to this contract. (F) Stenographic and clerical errors, whether in mathematical computations or otherwise, made by Seller on a Proposal, Order Acknowledgment or invoice issued to Buyer shall be subject to correction. (G) Any clause required by any applicable law, order or administrative regulation, to be included in a contract of the type evidenced by this contract, shall be deemed to be incorporated herein. (H) The remedies and rights reserved to Seller herein shall be cumulative with, and in addition to, all other rights and remedies provided in law or equity.