KGR LOGISTICS

Warehouse Liability Contract Terms and Conditions

(Approved and promulgated by American Warehouse Association, October 1968; revised and promulgated by International Warehouse Logistics Association, January 1998 [as modified])

Section 1 – ACCEPTANCE

The goods described on this warehouse receipt are stored and handled in accordance with these Contract Terms and Conditions. The act of tendering such goods for storage and/or other services by KGR Logistics constitutes acceptance of these Contract Terms and Conditions by the customer identified on the front side of this document (“Customer”).

Section 2 – SHIPPING

Customer agrees not to ship goods to KGR Logistics as the named consignee. If in violation of this agreement, goods are shipped to KGR Logistics as the named consignee, Customer agrees to notify the carrier in writing prior to such shipment, with copy of such notice to KGR Logistics, that KGR Logistics named as consignee is a warehouseman and has no beneficial title or interest in such property and Customer further agrees to indemnify and hold harmless KGR Logistics from any and all claims for unpaid transportation charges, including undercharges, demurrage, detention or charges of any nature, in connection with goods so shipped. Customer further agrees that, if it fails to notify the carrier as required by the preceding sentence, KGR Logistics shall have right to refuse such goods and shall not be liable or responsible for any loss, injury or damage of any nature to, or related to, such goods.

Section 3 – TENDER FOR STORAGE

All goods for storage shall be delivered to the warehouse properly marked and packaged for handling. Customer shall furnish, at or prior to such delivery, a manifest showing marks, brands, or sizes to be kept and accounted for separately, and the class of storage and other services desired. Unless Customer otherwise instructs in writing, KGR LOGISTICS need not keep separate the goods covered by each warehouse receipt but may store the goods in bulk, in lots, or in a commingled manner, at KGR LOGISTICS’s discretion. On request of Customer, and then only by special arrangement anal subject to extra labor charge, original packages may be broken for partial delivery.

Section 4 – STORAGE PERIOD AND CHARGES

(a) All charges for storage are per package or other agreed unit per month.

{b) Storage charges become applicable upon the date that KGR Logistics accepts care, custody, and control of the goods, regardless of unloading date or date of issuance of warehouse receipt.

(c) Except as provided in paragraph {e) of this section, a full month’s storage charge will apply on all goods received between the first and the 15th, inclusive, of a calendar month; one-Half month’s storage charge will apply on all goods received between the 16th and the last day, inclusive, of a calendar month; and a mill mont1a’e storage charge will apply to all goods in storage on the first clay of the next calendar month and each

(d) Unless KGR Logistics specifies otherwise, all *storage Charges are due and payable on the first day of storage for the iriitia1 month and thereafter on the first day of each calendar month.

(e) When mutually agreed by KGR Logistics and Customer, a storage month shall extend from a date in one calendar month to, but not including the same date of the next and all succeeding months. Notwithstanding such   agreement, all storage charges are due and payable on the first day of each storage month.

Section 5 – TRANSFER, TERMINATION OF STORAGE, REMOVAL OF GOODS

(a) Instructions from Customer to transfer goods on the books of KGR logistics are not effective until delivered to and accepted by KGR Logistics. All charges incurred up to the time transfer is made are chargeable to the Customer. Charges will be made for each such transfer and for any rehandling of the goods deemed by KGR Logistics to be required thereby. When goods in storage are transferred from one party to another through issuance of a new warehouse receipt, a new storage date is established on the date of transfer and these Contract Terms and Conditions shall apply as they do to this warehouse receipt.

(b) KGR Logistics reserves the right to move, at it’s expense, upon 10 days’ writing notice to the Customer, any goods in storage from the warehouse in which they may be stored to any other warehouse(s) operated by KGR Logistics. KGR Logistics may, without notice, move goods within the warehouse in which they are stored.

(c) KGR Logistics may, upon written notice to the Customer and any other person known by KGR Logistics to claim interest in the goods, require the removal of any goods within a started period, not less than 30 days of such notification. If the goods are not removed within the started period, KGR Logistics may sell them in accordance with applicable lien laws and exercise any other rights it has under law with respect to said goods.

(d) If KGR Logistics reasonably believed that the goods or any portion thereof are about to deteriorate or decline in value to less than the amount of KGR Logistics’ lien or may constitute hazard to other property, the warehouse or persons, such goods may be removed or disposed of by KGR Logistics as permitted by law. All charges related to said removal or disposal shall be paid by the Customer.

(e) In the event that a Customer request partial delivery of the goods covered by this warehouse receipt, these Contract Terms and Conditions shall continue to apply to the goods remaining in storage.

(f) This contract may be cancelled by either party upon 30 days’ written notice and is cancelled if the goods described on this warehouse receipt are removed from storage at KGR Logistics’ facilities.

Section 6 – HANDLING

(a) KGR LOGISTICS’s Handling charge covers the ordinary labor involved in receiving goods at warehouse door, placing goods in storage, and returning goods to warehouse door. Handling charges s are due and payable on receipt of the goods.

(b) Unless otherwise agreed, labor for unloading and loading goods will be subject to an additional charge. Additional expenses incurred by KGR Logistics in receiving and handling damaged goods, and additional expenses in unloading from or loading into cars or other vehicles not at warehouse door will be charged to Customer.

(c) When goods are ordered out in quantities less than in which received, KGR Logistics may access additional charge for each order or each item of an order.

(d) KGR Logistics shall not be liable for demurrage or detention, delays in onloading inbound cars, trailers or other containers, or delays in obtaining or loading cars, trailers or other containers for outbound shipment unless such demurrage, detention or delays are the result of KGR Logistics’ failure to exercise reasonable care.

Section 7 – DELIVERY REQUIREMENTS

(a) No goods shall be delivered or transferred except upon receipt by KGR Logistics of complete written instructions from or on behalf of Customer. Written instructions may be transmitted by fax, EDI, e-mail, or similar communication, provided, however, that KGR Logistics has no liability when relying on the information contained in the communication as received. If prior written authorization has been provided by Customer to KGR Logistics, goods may be delivered upon instruction by telephone in according with such prior written instructions, but KGR Logistics shall not be responsible for loss or error occasioned thereby.

(b) When goods are ordered out, a reasonable time shall be given KGR Logistics to carry out instructions. If KGR Logistics is unable because of acts of God, war, terrorism, public enemies, seizure under legal process, strikes, lockout, riots, and civil commotions, or any reason beyond KGR Logistics’ control, or because of loss or destruction of goods for which KGR Logistics is not liable, or because of any other excuse provided by law, KGR Logistics shall not be liable for failure to carry out such instructions and goods remaining in storage will continue to be subject to regular storage charges.

Section 8 – ADDITIONAL SERVICES AND CHARGES

(a) Warehouse labor required for services order than ordinary handling and storage will be charged to Customer.

(b) Special services requested by Customer, including, but not limited to, compiling of special stock statement, reporting marked weights, serial numbers or other data from packages, physical checking of goods, and handling of transfer billing, will be subject to a charge.

(c) Dunnage, bracing, packing materials or other special supplies may be provided by KGR Logistics for Customer at a charge in addition to KGR Logistics’ cost.

(d) By prior arrangement, goods may be received or delivered during other than regular business hours, subject to a charge.

(e) Communication expenses including postage or telephone will be charged to Customer if such concern more than normal inventory reporting or if, at the request of Customer, communications are made by other than regular United States mail, fax or e-mail.

(f) All charges other than storage charges addressed in Section 4 above are due and payable upon the date of invoice. All charges, including storage charges, not paid by the due date are subject to an interest charge from the date such charge is due until paid at the maximum interest rate permitted by law.

Section 9 – BONDED STORAGE

(a) A charge in addition to regular rates will be made for merchandise in bond.

(b) Where a warehouse receipt covers goods in U.S. Customs bonds, such receipt shall be void upon the termination of the storage period fixed by law.

Section 10 – MINIMUM CHARGES

(a) A minimum handling charge per lot and a minimum storage charge per lot per month will be made. When the warehouse receipt covers more than one lot or when a lot is an assortment, a minimum charge per mark, brand or variety will be made.

(b) A minimum monthly charge to one account for storage and /or handling will be made. This charge will apply also to each account when the Customer has several accounts, each requiring separate record and billing.

Section 11 – LIABILITY AND LIMITATION OF DAMAGE

(a) KGR Logistics shall not be liable for any loss or damage to goods stored, however caused, unless such loss or damage resulted from failure by KGR Logistics to exercise such care in regard to the goods as a reasonably careful man would exercise under like circumstances. KGR Logistics is not liable for damages which could not have been avoided by the exercise of such care. In particular, but without limiting the extent of the foregoing disclaimer, KGR Logistics shall not be responsible for damage caused by fire, wind, water, sprinkler leakage, vermin, acts of God, strikes, terrorism or other work stoppages, or other causes that are beyond the control of KGR Logistics.

(b) In the case of loss or damage, under no circumstance shall KGR Logistics be liable for any damages in excess of the actual cost to Customer of replacing or reproducing the goods at the time of loss or damage or $0.50 per pound, whichever is less, or for any lost profits or other consequential or incidental damages or for punitive damages. In the event there is no cost invoice the value must be justified with a commercial invoice or professional appraisal.

(c) Where loss or damage occurs to stored goods, for which KGR Logistics is not liable, Customer shall be responsible for the cost of removing and disposing of such goods and the cost of any environmental clean-up and site remediation resulting from the loss or damage to the goods.

(d) In the event that KGR Logistics approves a damage claim for payment, KGR Logistics shall be entitled to possession of the portion of the goods for which claim was made and payment approved, with the exception of food products that may cause harm if sold in a damaged state. The failure to provide or release the damaged goods to KGR Logistics shall be bar to recovery of the claim.

(e) If KGR Logistics negligently mis-ships goods, KGR Logistics shall pay the reasonable transportation charges incurred to return the mis-shipped goods to the warehouse. If the consignee fails to return the goods, KGR Logistics’ maximum liability shall be that for lost or damaged goods as specified above.

Section 12 – NOTICE OF CLAIM AND FILLING OF SUIT

(a) Claims by Customer and all other persons must be presented in writing to KGR Logistics within a reasonable time, and in no event longer than either 60 days after delivery of the goods by KGR Logistics or 60 days after Customer is notified by KGR Logistics that loss or damage to part or all of the goods has occurred, whichever time is shorter.

(b) As a condition precedent to making any claim and/or filing any suit, Customer shall provide KGR Logistics with a reasonable opportunity to inspect the goods which are the basis of Customer’s claim.

(c) No lawsuit or other action may be maintained by Customer or others against KGR Logistics for loss or damage to the goods stored unless (1) timely written claim has been given as provided in paragraph (a) of this section, (2) KGR Logistics has been provided an opportunity to inspect the goods as provided in paragraph (b) of this section and (3) such lawsuit or other action is commenced either within nine months after date of delivery by KGR Logistics or within nine months after Customer is notified by KGR Logistics that loss or damage to part or all of the goods has occurred or otherwise learns of the loss or damage, whichever time is shorter

Section 13 – INSURANCE

Goods are not insured by KGR Logistics, and the storage rates do not include insurance on the goods unless KGR Logistics has agreed in writing to obtain such insurance for the benefit of Customer. In the event Customer choose to self-insure stored goods, Customer acknowledges that customer insurance will always be the primary.

Section 14 – RIGHT TO STORE GOODS

Customer represents and warrants that Customer is lawfully possessed the goods and has the right and authority to store them with KGR Logistics. Customer agrees to indemnify and hold harmless KGR Logistics from all loss, cost and expense (including reasonable attorney’s fees) which KGR Logistics pays or incurred as a result of any dispute or litigation, whether instituted by KGR Logistics or others, respecting Customer’s right, title or interest in the goods. Such amounts may be assessed as charges in relation to the goods and subjects to KGR Logistics’ liens rights.

Section 15 – ACCURATE INFORMATION

Customer will provide KGR Logistics with information concerning the stored goods which is accurate, complete and sufficient to allow KGR Logistics to comply with all laws and regulations concerning the storage, handling and transportation of the goods. Customer will indemnify and hold KGR Logistics harmless from all loss, cost, penalty, and expense (including reasonable attorneys’ fees) which KGR Logistics pays or incurs as a result of Customer failing to discharge this obligation.

Section 16 – SEVERABILITY AND WAIVER

(a) If any provision of this Contract Terms and Conditions, or any application thereof, should be construed or held to be void, invalid or unenforceable, the remaining provisions of these Contract Terms and Conditions shall not be affected thereby but shall remain in full force and effect.

(b) KGR Logistics’ failure to require strict compliance with any provision of these Contract Terms and Conditions shall not constitute a waiver or estoppel to later demand strict compliance with that or any other provision(s) of these Contract Terms and Conditions.

Section 17 – ENTIRE AGREEMENT

The provisions of these Contract Terms and Conditions shall constitute the entire agreement between KGR Logistics and Customers, shall be binding upon Customer’s heirs, executors, successors, and assigns; and cannot be modify except by a written signed by KGR Logistics and Customer.