Sales Terms

Customers purchasing National Envelope’s products and services are subject to the terms of this agreement. “National Envelope” means NE Opco, Inc., doing business as National Envelope. “Customer” shall include you and any of your affiliates that place an order with us. By placing your order, you accept these terms of sale, unless we have agreed to different terms in writing.

§ All orders are subject to acceptance or cancellation by us.

§ Please review all order confirmations and report any inaccuracies to assure your order is handled correctly.

§ Accepted orders will be billed at price prevailing at time of shipment.

§ Prices are subject to change without notice.

§ Price and delivery on special quotations may be regarded as firm if the order is received within 30 days, except for freight costs which may be subject to revision due to alternative arrangements including split shipments, inside deliveries or other requests not specified at the time of quote.

§ The delivery date quoted begins when the order is received.

§ Possession of this price book and all price lists is not to be construed as an offer to sell.

§ Different or additional terms in customer purchase orders will not change or modify these sales terms.

§ All orders for stock items are subject to prior sale.

§ Upon request, and at our discretion, we will attempt to hold available stock for 24 hours for a specific future order.

Customer is responsible for any revenue, sales and use or other tax like charges imposed on or incidental to the Products or Service (excluding our net income tax).

Payment terms are in our discretion. Unless other terms are agreed to by us, payment must be received by us prior to our acceptance of an order.

§ All quotations are based on customer’s specifications, including, but not limited to, envelope size and style, paper type, window location and material, printing coverage, color(s) and method, etc.

§ If the sample submitted with the purchase order, or the product specification within the purchase order, differs from the quoted specifications, price and delivery may be adjusted to accommodate the changes.

§ All telephone orders for specially manufactured items must be confirmed with a written purchase order. We reserve the right to not process the order, reserve machine time or order materials until the written purchase order is received and accepted.

On special making orders, the following variation in final quantity shall be accepted as complete fulfillment of the order and paid as billed:

Order Quantity	5M-24M	25M-99M	100M-499M	500M-999M	1MM+
Over/Under Run	20%	10%	5%	3%	2%

For special making orders specifying an exact quantity, a “not more than” or a “not less than” quantity, the following upcharge per item will be added to the invoice:

Order Quantity	5M-24M	25M-99M	100M-499M	500M-999M	1MM+
Upcharge	20%	10%	5%	3%	2%

§ Accepted orders may not be cancelled without our consent.

§ A cancellation charge of $50.00 may be assessed for order cancellation.

§ Charges may be assessed against customers who request cancellations of non-stock or printed items. These charges will include all actual costs incurred up to the time the written cancellation request is accepted by us. Typical costs would include dies, special paper and paper sizes, ink, freight, manufacturing, and any associated labor costs.

Under certain conditions, we may accept returns of stock in perfect condition. These conditions are as follows:

1. No product may be returned for credit without a Return Merchandise Authorization (RMA) number. (Contact our Customer Service Department to obtain a RMA number and shipping instructions.)

2. Only National Envelope standard inventoried items which are unopened and within our normal inventory levels, are eligible for return. Paper mill discontinued colors and finishes are not eligible.

3. Returns of standard items sold by one plant but produced and stocked by another, must be returned to the location of shipment origin.

4. All return requests must be made within 60 days of shipment.

5. Credit will be issued for full unopened cartons at the invoiced price, less freight both ways and all other applicable charges when product is received in perfect condition only.

6. All returns are subject to a $25.00 minimum return charge or a 20% reconditioning charge, whichever is higher.

7. Only National Envelope can decide the disposition of rejected envelopes. Do not destroy or return any defective merchandise to us without appropriate authorization.

§ All orders for stock product, regardless of order size, will be shipped in full carton quantities only.

§ Orders placed with quantities not in standard full carton increments will be automatically shipped at the next higher carton count and billed accordingly.

§ Minimum order quantity is 1 carton.

All cutting dies, not specifically ordered and paid for in full, are, and remain, the property of National Envelope.

Our normal policy is not to bill and hold items. If we do accept your special request for a delayed shipping date, we will bill and hold the products at no charge for up to 90 days from the date of your order. After this 90 day holding period, you agree to pay for storage at our then current rates. Title and risk of loss or damage to the products will pass to you upon our sending an invoice for the stored products.

Blanket purchase orders will be considered if they meet the following conditions:

1. The blanket purchase order is for a defined period of time.

2. Shipment dates and amounts are set at the time of acceptance.

3. Unless noted at the time of our acceptance, pricing includes one shipment per month. Additional shipments per month or split shipments will increase the price.

4. Requests for shipment must be received at least seven (7) working days prior to the required delivery date.

5. For product held for more than 30 days, we will bill for any storage fees that may apply.

FREIGHT COLLECT:

BUYER bears and pays freight charges.

BUYER owns goods in transit.

BUYER files claims, if any.

FREIGHT PREPAID:

SELLER bears and pays freight charges.

BUYER owns goods in transit.

BUYER files claims, if any.

FREIGHT PREPAID & CHARGED BACK:

SELLER pays freight charges.

BUYER back. BUYER owns goods in transit.

BUYER files claims, if any.

If an item that is part of an eligible, prepaid freight order is out of stock at the National Envelope location fulfilling the order, that item, once replenished at that same location, will ship the item freight, prepaid, to the same ship-to address as the original order. At the customer’s request, we will ship out-of-stock items that are part of a prepaid shipment from another National Envelope location that has the item in stock and charge the appropriate freight expense.

LIMITATIONS ON NATIONAL ENVELOPE’S LIABILITY

Liability - Our liability for defects in material or workmanship is limited to replacement of finished product only. Our liability for merchandise shipped or mislabeled in error is limited to replacement only.

Laser Printers - National Envelope takes extraordinary care in the manufacture of envelopes from laser guaranteed papers and other papers that may be used in laser printers, but due to the nature of the laser process, we cannot guarantee our products for use in this equipment.

1. If you encounter an envelope quality problem and doubt that the finished product will be acceptable, stop production and notify your National Envelope Sales or Customer Service Representative immediately. When a defect in product is discovered outside of normal business hours, National Envelope must be notified the following business day.

2. National Envelope is not responsible for any charges or product waste incurred when customers continue production without receiving authorization.

3. Customers must keep adequate evidence, which clearly shows the problem, for our inspection.

4. If requested by us, a National Envelope Representative must be permitted to visit the customer to make a complete investigation.

5. If National Envelope determines that the problem is directly related to defective envelopes, we will honor the claim for an amount up to the original cost of the envelope only.

6. No claims will be processed without a written request.

7. Requests for credit on defective envelopes must be initiated within 90 days of invoice date.

8. All related product and order information, such as run and inspection numbers, should be submitted with samples.

THE FOREGOING WARRANTIES AND REMEDIES ARE EXCLUSIVE AND ARE IN LIEU OF ALL OTHER WARRANTIES, EXPRESS OR IMPLIED, EITHER IN FACT OR BY OPERATION OF LAW, STATUTORY OR OTHERWISE INCLUDING WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE TO THE FULLEST EXTENT PERMITTED BY LAW.

In no event, whether based in contract or tort (including negligence) shall we be liable for incidental, consequential, indirect, special or punitive damages of any kind or for loss of revenue, loss of business, lost profits, or cost of cover, procurement of substitute products, or other financial loss arising out of or in connection with this Agreement. In no event shall our aggregate liability in any action or proceeding exceed the amounts actually paid by you for the products directly related to the action.

Upon receipt of complaint, seal flap gum will be tested in the following manner:

1. Each envelope being tested will contain one sheet of 81/2 x 11 - 10M bond paper or equivalent, unless purchase order specifically requested multiple sheet insertion.

2. All envelopes, which can be automatically sealed, will be run through an industry standard mailing machine.

3. If the envelopes seal adequately, they will be returned to the customer together with an appropriate written report.

4. If the envelopes cannot be sealed mechanically by nature of their construction or paper grade or type, they will be tested manually and a written report will be submitted to the customer.

National Envelope takes great care in designing envelopes for use with automatic inserting equipment. However, due to numerous variables in insertion machines, National Envelope cannot guarantee product performance on inserting machines. When machine insertability is specified, samples should be requested at time of inquiry for the customer to test compatibility with their equipment.

Due to machine tolerances in the die cutting and folding operations of envelope manufacturing, envelope size, window position, and printing placement can vary by + 1/16” which is the industry standard.

§ We will not be responsible for variations in shade, finish, weight, strength, or cleanliness, when such variations are within the paper manufacturer’s tolerances.

§ We assume no liability for paper discoloration due to the application of adhesive on any paper furnished or specified by the customer.

§ We will not be responsible for bleeding or fading of paper dyes when used in moisture or light applications not recommended by the paper manufacturer.

FREIGHT CLAIMS

The buyer is responsible for filing all freight claims. Our Customer Service Department is available to assist customers with claims for loss or damage when a National Envelope contract carrier is used. To do this, the following minimum requirements must be met:

The carrier’s delivery receipt must reflect the number of cartons short on a shipment; otherwise, there is no liability on the part of the carrier, and the carrier will not honor the claim.

§ The delivery receipt must indicate the number of cartons received and the damaged condition must also be noted.

§ If damage is concealed and not discovered at time of delivery, or if shipment is via rail, the carrier must be contacted within 24 hours of delivery to inspect the shipment. If there is any indication of possible damage, the receiver must indicate on the delivery receipt “Subject to Further Inspection.”

§ Whenever possible, supply a photo of the damaged goods to facilitate claim processing.

§ All complaints must include a National Envelope order number(s), date(s) of shipment, customer name, address, contact person, and complete description of the problem.

§ All damaged goods must be retained until the carrier or National Envelope rules on their disposition.

CONVERTING

The following conditions shall apply to orders accepted for making envelopes from paper furnished by the customer:

1. Paper shall be well jogged and packed by customer and shall be free from damaged edges.

2. We do not accept responsibility for the quantity of paper supplied. All skids or cartons must be plainly marked with the quantity, order number, etc.

3. When paper is received in poor condition, it will not be cut without specific written instructions from the customer to proceed with the work at the customer’s risk for spoilage.

4. Unless otherwise determined, paper shipped to us for converting shall be shipped freight prepaid.

In addition to rules 1-4, when customer-provided paper is imaged in any way:

5. Samples must be approved for converting.

6. We assume no responsibility for proper cutting or folding of envelopes from sheets imaged according to any layout or press-proof we have not approved or supplied.

7. We cannot guarantee absolute conformity of location of the image on envelopes cut from flat sheets.

Waste - The variation in quantity (paper received versus the actual yield) will be subject to the following waste levels and shall constitute acceptable delivery:

Quantity Ordered: 5M-25M 26M-50M 51M-100M 101M-250M 250M Plus

Waste Allowance: 20% 15% 10% 8% 6%

Waste variance for additional operations:

Quantity Ordered: 10-49M 50M Plus

Windows & Printing Add 3% Add 2%

Peel & SeelÂ® Add 4% Add 3%

§ We accept no responsibility for the quantity of paper received except on special agreement with the customer at the customer’s expense for counting.

§ All skids or cartons must be plainly marked with the quantity, order number, etc.

§ Converting instructions for the paper and shipping instructions for the envelopes should be sent to us at the same time the paper is ordered or shipped to us. If converting and shipping instructions are not received with the paper delivery, unless we have written converting and shipping instructions within 30 days, a monthly storage charge of $1.00 per cwt per month will apply from the date the paper is received by us.

PRINTING

§ Unless specified at time of quote, art should be submitted in acceptable digital form and sent via e-mail or on computer disk to the appropriate National Envelope location with a written purchase order.

§ The art must clearly define exactly all printing specifications. For information on supported software programs, contact our Customer Service Department.

§ Printed samples are not sufficient to provide satisfactory reproduction. Where samples only are provided, price and delivery of the printed order will be adjusted if we are asked to produce acceptable art to produce the job.

§ By providing art or other materials for reproduction, you represent that you own or have rights to use the art or other materials and agree to indemnify us for any claims that the art or other materials provided by you infringe another entity or person’s intellectual property rights.

§ All images and imaging materials which National Envelope produces, which are not specifically ordered and paid for in full, are and remain property of National Envelope.

§ If customer provides artwork, originals, plates, or other materials and does not request their return when the order is placed, National Envelope will hold them for only 60 days.

When a printing proof has been sent for approval, we will not be responsible for (i) any errors the customer fails to correct in the proof or (ii) any delays in delivery if approval is delayed.

Printing quotations are based on specifications given to us by our customer. If specifications are different after receipt of copy/art information, prices and delivery may be adjusted.

GENERAL

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Confidential Information: “Confidential Information” means all information from you or us, which is disclosed by either to the other, and which is non-public, proprietary or confidential and which is marked as “confidential” or “proprietary” or otherwise reasonably known to be confidential. Confidential Information also includes the amounts ordered and prices paid under this Agreement and information relating to sales volumes, whether or not marked confidential.

Each party agrees to hold the Confidential Information of the other in confidence and not to use, reproduce, distribute or disclose it, except as authorized by the other party in writing, in connection with the performance of this Agreement.

Confidential Information does not include any information which (a) was already known by the recipient at the time of disclosure, (b) is or becomes generally known to the public without breach of this Agreement, (c) is rightfully received from a third party without restriction on disclosure and not, to the knowledge of recipient, in breach of any obligation of confidentiality, (d) is independently developed by the receiving party without use of the Confidential Information, or (e) provided the disclosing party is given notice and opportunity to intervene, is produced in compliance with applicable law or court order.

The confidentiality obligations described herein shall commence on the date of disclosure of the Confidential Information and shall continue (a) for Confidential Information which qualifies as a trade secret under applicable law, at all times thereafter so long as such Confidential Information so qualifies as a trade secret and (b) for all other Confidential Information, for a period of three (3) years following such disclosure.

We are excused from performance, delay or failure in performance due to causes beyond our reasonable control.

Neither party may transfer, assign or subcontract its rights or obligations under this Agreement without the prior written consent of the other party; provided, however, that either party may assign this Agreement, without the consent of the other, to any entity affiliated with, controlling, controlled by or under common control with the assigning party. A merger, sale of business or sale of all or substantially all the assets of either party shall not be considered a breach of this section. This Agreement shall be binding upon and inure to the benefit of the parties to this Agreement and their respective successors and assigns subject to the limitations in this Agreement.

This Agreement is the entire agreement between the parties regarding the subject matter hereof and may not be altered, supplemented, or amended by the use of any other document unless otherwise agreed to in a written agreement signed by both you and us.