Please note that your order is subject to the terms and conditions set forth below in this sales contract (the “Contract”). This Contract constitutes all of the terms of agreement and is binding between you, the “Buyer,” and Nutritional Supplement Manufacturers, Inc., the “Seller” with respect to your order for the manufacture and packaging of raw materials (supplied as agreed either by the Seller or Buyer, the “Goods”) that Buyer places with Seller pursuant to the purchase order submitted by Buyer and accepted by Seller (the “Order”) identified above. No additional or different terms stated orally or in any other document other than the Order are agreed to or binding on Buyer or Seller. Buyer and Seller agree to accept and be bound by the Order and the terms and conditions set out below. The Buyer’s signature below evidences acceptance of this Contract and the Order, by tendering full payment or a deposit payment, buyer further indicates acceptance and agreement to this Contract.
Prices for the Goods are as stated on the face of the Order. All prices are EX Works Seller’s warehouse and do not include any cost for freight. Any costs or charges for freight, insurance or any applicable sales, use, transfer, excise or other taxes, tariffs or custom duties, shall be the responsibility of Buyer. Increases in material costs before completion of the Order may be invoiced to Buyer. Final payment must be received within the payment terms specified in the accepted Order. All Orders are to be paid in full when production of the Order is complete and are not contingent upon label completion. If Seller is printing labels for the order, Seller will see that the label production will coincide with Goods production. If payment in full of an invoice is not made by or before the due date, Buyer agrees to pay interest on any unpaid amount at a rate of 1.5% per month or 18% per annum from the due date until the invoice and all interest associated therewith is paid in full, and shall pay for all Seller’s costs of collection including reasonable attorney’s fees and court costs. All sales are final. In the event Seller grants payment terms to Buyer, Seller may revoke such payment terms at any time and for any reason, in Seller’s sole and absolute discretion, and require Buyer to tender pre-payment for Goods either before manufacture or before delivery..
Delivery terms for Goods purchased hereunder shall be EX Works Seller’s warehouse or other point designated by Seller (the “Shipping Point”) and Buyer’s designated carrier shall pick-up the Goods at the Shipping Point and all cost of shipping shall be borne by Buyer. Buyer has the option of electing to insure the Goods while the Goods are in the possession of a third-party carrier, the cost of such insurance will be borne by Buyer and such costs are in addition to the shipping costs. Title to the Goods purchased by Buyer and risk of loss of all Goods shall pass to Buyer upon delivery of the Goods to Buyer’s designated carrier or common carrier at the Shipping Point. Delivery dates set forth on the Order are subject to change and are predicated on conditions existing at the time. Seller does not guarantee any delivery dates and shall not be responsible for any loss or damage of any kind or nature whatsoever caused by any delay in delivery irrespective of the cause of such delay.
Storage fees are not part of this invoice. Inactive inventory (materials obtained for or by Buyer and Goods in process or finished) stored in Seller’s facility, due to Buyer delays (due to decision making, labels not being ready, etc) will be billed at a rate of $100.00 per pallet per week and $50 for goods that take up less than ¼ of a pallet, unless otherwise agreed upon. Any inactive inventory held longer than 30 days without payment will be considered abandoned and will become the property of Seller. It is provided further that Seller has the right to sell Goods that are not paid for after 45 days. For every order there is a possibility of 10%+/- for the final quantity of Goods. The customer agrees to adjust price as it is an industry standard. This applies to all orders from minimum and up.
Not more than five (5%) of Products delivered can have cosmetic defects such as dented capsules, broken capsules powder on capsules and crooked labels. Should such defects happen Seller is to compensate Buyer for same amount of Products by adding those to next order. However, Buyer cannot throw away any Products. Upon prior agreement with the Buyer, all defective Products need to be returned to an address specified by Seller. Shipping cost is to be paid by Buyer. Seller will reimburse shipping fees to Buyer after inspecting goods. Buyer nor Seller is to pay no storage and no handling fees regarding those Products.
Buyer shall carefully inspect all Goods promptly upon the receipt. Any claim for overage or shortage must be presented to Seller, in writing, within three (3) business days of receipt of the Goods by Buyer. Any other claim for breach of the warranty stated in Paragraph 9 hereof, must be presented to SELLER in writing, within thirty (30) days after receipt of the Goods by Buyer. Failure to make a claim within the above specified periods shall constitute a waiver of any such claim. Claims must be accompanied by supporting documentary proof of such overage shortage or breach of warranty.
The expiration date of Goods can only be determined by doing a stability study. If a stability study is not conducted, a “Date of Manufacturing” will be issued for each Good. If an expiration date is issued without a stability study, this will be done only per the Buyer’s request and is at Buyer’s own risk and Seller is not liable. Buyer certifies that the Goods and packaging ordered has been stability tested in accordance with industry standards prior to ordering and that the Goods and packaging specifications provided by Buyer are identical to the specification used for stability testing. Seller is not responsible for stability testing the Goods unless agreed upon in writing and signed by an officer of Seller. In the event that Buyer’s Goods and/or packaging specifications have not been stability tested, or the specifications provided to Seller deviate from those used in the stability test, Buyer agrees to hold Seller harmless and to fully indemnify Seller against any and all claims for damages or loss arising out of the Goods becoming unstable, unmarketable, less effective than claimed or intended, or otherwise deviating from the specifications, which occurred as a result of the Good’s instability after manufacturing. This indemnification includes Seller’s costs, expenses and reasonable attorney fees.
Should Buyer be late in delivering labels and product has to be put back on the line to be labeled, Buyer agrees to pay an additional setup fee of $1,000.00.
Except for a breach by Seller of the Warranty in Paragraph 11, Buyer acknowledges and agrees that Buyer is solely responsible for all aspects of the Goods, including but not limited to, their safety, efficacy, legality, design, the formula, any label content, packaging materials, and all marketing and promotional claims made about the Goods in any forum or media. Additionally, Buyer is responsible to see that the Goods, including, but not limited to, any label, formula, ingredient, component, raw materials, or marketing materials fully comply in every respect with all local, state and federal laws, statutes, rules, orders and regulations applicable to the Goods. Buyer assumes sole responsibility for analyzing and determining the suitability of any Goods supplied by Seller and Buyer agrees that it is not relying on Seller in making such determination even if Seller provided assistance, guidance or design. Buyer assumes full responsibility for any particular use or purpose. Buyer will not order or use any Goods unless it is satisfied that the Goods are suitable for Buyer’s use and conform to all of its requirements. Buyer agrees to store and use all Goods in a safe manner.
Unless otherwise agreed to and expressly provided for in the Order, when Buyer supplies raw materials for manufacture by Seller into the Goods, Buyer assumes responsibility to calculate levels of contaminants in raw materials based on Certificate of Analysis (COA. This calculation will determine levels of contamination (lead, arsenic, cadmium, mercury) in daily dose stated on label and to ensure such dose meets all requirements of California’s Safe Drinking Water and Toxic Enforcement Act of 1986 (commonly known and referred to as Proposition 65, “Prop 65” herein).
When Seller receives the raw materials Seller will verify the COA by testing for heavy metals as per GMP regulations. Seller will then calculate Prop 65 levels and inform Buyer. Buyer agrees that should product not pass Prop 65 Buyer will either issue a warning on the label as per Prop 65 or change the dosages so the label meets Prop 65 levels. In this way Buyer bears sole responsibility to meet Prop 65 rules. Should the Goods not meet Prop 65 thresholds at the dosage levels on the labels, Buyer certifies that she will label all products sold in the state of California: “WARNING: This product contains a chemical known to the state of California to cause birth defects or other reproductive harm,” or any other warning required under Prop 65. Additionally, Buyer represents to Seller and agrees to ensure that any dosage recommendation will not cause overdose or adverse reactions in individuals, including but not limited to vitamins (for example vitamin a and d)or substances that may accumulate in the body. Buyer will include all appropriate and/or legally required warnings on labels and supporting websites and literature with regard to concerns of side effects/adverse reactions.
Unless otherwise agreed to and expressly provided for in the Order, when Seller supplies raw materials for manufacture into Goods for sale, distribution or consumption in California, Seller shall calculate levels of contaminants in the daily dose stated on label and determine whether the dose meets all requirements of California’s Safe Drinking Water and Toxic Enforcement Act of 1986 (commonly known and referred to as Proposition 65, “Prop 65” herein). Buyer agrees to adjust dosage and/or change labels as needed to comply with Prop 65, as advised by Seller based on testing performed by Seller. Buyer acknowledges its responsibility to comply with Prop 65 and agrees to accept Sellers guidance and advice as required to achieve such compliance. Should the Goods not meet Prop 65 thresholds at the dosage levels on the labels proposed by Buyer, Buyer agrees that such goods will not be sold or otherwise distributed in California or that it will label all such products sold or otherwise distributed in the state of California with the warning required under Prop 65, and shall cause Prop 65 required warnings to be prominently displayed to all California internet on-line buyers with California IP addresses, whether sold directly by Buyer or distributors of Buyer. Buyer agrees that IP detection will be utilized on their own and their distributor’s websites in order to identify California buyers for purposes of displaying the required warnings. Additionally, Buyer represents to Seller and agrees to ensure that any dosage recommendation will not cause overdose or adverse reactions in individuals, including but not limited to vitamins or substances that may accumulate in the body. Buyer will include all appropriate and/or legally required warnings on labels and supporting websites and literature with regard to concerns of side effects/adverse reactions.
Seller warrants that the Goods delivered hereunder will be manufactured in accordance with applicable Good Manufacturing Practices of the United States Food and Drug Administration (“GMP”) and conform to the agreed upon specifications for the Goods, in all material respects, at the time of delivery to Buyer. Seller makes no representation or warrantee that the Goods are appropriate for Buyers intended use and Seller shall have no liability for any damages or claims resulting from Buyer use of Goods. If Buyer has made any alteration to any Goods, Buyer will have waived all warranty claims. No warranties may be assigned to any subsequent purchaser or user of the Goods or services.
The foregoing warranty is exclusive and in lieu of all other warranties, whether written, oral or implied, including any warranty of performance, merchantability or fitness for a particular purpose. it is the sole responsibility of buyer to determine the adequacy of all goods purchased by buyer for any intended specific purpose or use. seller shall not be responsible for any loss or liability arising out of or resulting from customer’s possession or sale of the products, regardless of whether such liabilty is based in tort, contract or otherwise and whether or not such loss is foreseeable.
Seller’s liability on any claim of any kind, including, without limitation, negligence, with respect to Goods or services shall in no case exceed the purchase price of the good or service or part thereof which gives rise to the claim.
In no event shall seller be liable for any special, incidental, consequential, punitive or exemplary damages or similar damages (including, without limitation, lost profits or economic damages), or for damages in the nature of penalties regardless of cause and whether or not foreseeable. the obligation of seller to replace (or refund the purchase price of) any defective goods shall be in lieu of all other remedies, and seller’s liability for damages under this contract (whether based on an action or claim in contract, tort or otherwise) shall not in any event exceed a refund of the purchase price paid by buyer to seller for the specific goods in question.
Buyer agrees to indemnify, defend, and hold Seller, its officers, directors, shareholders, agents and employees, or any affiliates thereof, harmless from and against all claims, liabilities, costs, damages, losses, judgments for damages or expenses (including reasonable attorney’s fees) caused by, arising out of, or resulting from (i) any breach of this terms and condition of sale by Buyer, or (ii) the marketing, distribution and/or sale of the Goods, including but not limited to failure to warn, product liability claims, recalls and class action lawsuits. Seller agrees to indemnify, defend, and hold Buyer, its officers, directors, shareholders, agents and employees, or any affiliates thereof, harmless from and against all claims, liabilities, costs, damages, losses, judgments for damages or expenses (including reasonable attorney’s fees) resulting solely from a breach by Seller of the warranty stated in paragraph 9 above.
This Contract and the associated Order contains the entire understanding of the parties with regard to Seller’s sale of Goods referenced herein to Buyer. These terms and conditions of sale constitutes the complete and exclusive agreement and no statement or agreements, oral or written, shall vary or modify the written terms hereof under any circumstances. Any modification to this Contract or the associated Order must be clearly designated as such and must be in writing and signed by both parties. If any provision of this Contract is declared invalid, illegal or unenforceable, all other provisions shall remain in full force and effect. This Contract shall be governed and interpreted exclusively under the laws of the State of California without regard to conflict of laws provisions and venue for any dispute or legal action shall be in the City of San Diego.
From time to time our customers request us to store raw materials for them, to be used in production of their products. We can do so with the following conditions:
However, since we are very flexible you can avoid both the cost of formulation and stability study, this however comes at an increased risk and is something you need to consider carefully.
We charge $10,000 to formulate a liquid supplement. You indicate the desired flavor and texture. We deliver one initial sample. Included in the price is for us to improve that sample three times. If you need to change the formula we charge an additional $10,000 and start over. Please be sure that the formula you decide on is the one you want. Just changing one ingredient throws the entire formula out the window because this one change often changes both stability, texture, and flavor of the formula.
We welcome you to formulate your own products provided you have experience. In this case, we provide you with enough sample of raw materials on cost plus a fee of $500 to formulate. In this case you are 100% responsible for how the formula turns out, so please double check the weights, timing, temperature, type of blenders, time of blending, problems experienced and possible solutions. We must warn you that, most often, formulating a liquid supplement that stays in solution is impossible for anyone but the most experienced chemists, this depends on the formula though. Once we get the detailed formula back from you we will run a pilot batch for of 20 gallons for a fee of $3,000 plus raw materials and labor to evaluate the formula viability for mass manufacturing. This will include stability estimations but not stability tests, see “Stability Study” below.
We charge $3,000 to formulate a powder supplement. We welcome you to formulate your own products and, in this case, provide you with enough sample of raw materials for on cost plus a fee of $500. In this case you are 100% responsible for how the formula turns out, so please double check the weights and make sure you give us the exact formula you want us to manufacture.
We have an existing formula, I don’t want to pay the Formulation Fee!
Often our clients think they have the formula, however only have a list of ingredients. If you don’t have access to the most recent Batch Record and preferably the last 3 Batch Records that your previous manufacturer used, then you do not have the formula. In addition to the Batch Records you need to have the specific name and source of each of the raw materials. (see below)
“The Formula” must include times, temperatures, how to add ingredients, speed of blenders, temperature of kettles, timing of adding raw materials, timing of blending, type of blenders used, what kind of exhaust systems are used, troubleshooting guides, past problems and solutions to those problems.Most importantly you need to give us the exact vendors are of all the raw materials and include the supplier’s SKU# for that raw material. Please note each raw material has a generic name and a specific name, the generic name is useless to us. When it comes to liquid supplements the exact raw materials used are the key to a successful formula. If you don’t know what those are, we need to start from scratch. If the manufacturer is out of business, then the formula must be re-formulated. Again, any one change will affect the entire formula, this is true especially for liquid formulas.
A stability study is performed in the same packaging as when your product is sold as finished goods, the product is put under the influence of a variety of environmental factors such as temperature, humidity. Data from these studies enable recommended storage conditions and shelf lives to be established. Further such studies bring to light where the formula needs to be improved.
No, you don’t, however in the rare case the product develops a problem, falls out of solution, is clumpy, does not taste quite right, then you own it. We will not take the product back and “re-manufacture” it. You will simply need to tell your customers that it’s a Natural Product and therefore the product looks and feels like this.
$4,000 to $10,000 in general depending on the product.