A. Applicability and Acceptance
These Customer Terms & Conditions apply to quotations, purchase orders, manufacturing services, product-development services, testing, packaging, warehousing, and other goods or services provided by BPI Labs, Inc. dba Ally Labs ("Ally Labs"), unless superseded by a written agreement executed by an authorized representative of Ally Labs.
Order of Precedence; Conflicting Terms
These Customer Terms & Conditions apply to all quotations, purchase orders, manufacturing services, product development services, testing, packaging, warehousing, and other goods or services provided by BPI Labs, Inc. dba Ally Labs ("Ally Labs"), except to the extent expressly superseded by a written agreement executed by an authorized representative of Ally Labs.
In the event of any conflict, inconsistency, or ambiguity among documents governing a transaction between Ally Labs and a customer, the following order of precedence shall apply, with the document listed first controlling over any document listed below it:
1. Executed Manufacturing or Supply Agreement – Any manufacturing, supply, services, or similar agreement signed by authorized representatives of both Ally Labs and the customer.
2. Quality Agreement – With respect solely to quality, testing, specifications, regulatory responsibilities, release procedures, investigations, complaints, recalls, and other quality-related matters, an executed Quality Agreement shall control.
3. Executed Product Development or Other Project-Specific Agreement – With respect to matters specifically addressed by that agreement, including formulation development, intellectual property, testing, development fees, or project-specific obligations.
4. Ally Labs Accepted Quotation or Proposal – Including applicable pricing, minimum order quantities, payment requirements, product specifications, packaging, testing, tooling, development charges, lead-time assumptions, and other project-specific commercial terms.
5. These Ally Labs Customer Terms & Conditions.
6. Customer Purchase Order – Solely with respect to mutually accepted administrative and order-specific information such as product, quantity, requested delivery date, shipping destination, and purchase-order number.
Customer Purchase Order Terms
Any preprinted, standard, electronic, incorporated-by-reference, or other terms and conditions contained in or accompanying a customer's purchase order, procurement portal, vendor onboarding system, acknowledgment, email, invoice-processing system, or other customer document are expressly rejected and shall not modify, supplement, or supersede these Customer Terms & Conditions or any other applicable Ally Labs agreement.
Ally Labs' acceptance of a purchase order, commencement of work, procurement of materials, manufacture of product, shipment of goods, issuance of an invoice, or acceptance of payment shall not constitute acceptance of any additional or conflicting customer terms.
Any additional or conflicting terms proposed by a customer shall become binding upon Ally Labs only if expressly accepted in a written amendment or agreement signed by an authorized representative of Ally Labs.
Specific Terms Control Over General Terms
Where two applicable documents are otherwise of equal priority, a specifically negotiated provision addressing the particular subject matter at issue shall control over a more general provision.
No Modification by Course of Dealing
No prior course of dealing, course of performance, industry practice, trade usage, verbal statement, email communication, or failure to object to a customer document shall modify these Customer Terms & Conditions unless the modification is expressly agreed to in writing by an authorized representative of Ally Labs.
B. Quotations
- Quote expiration (30 days)
- Quotes are estimated rather than guaranteed pricing where appropriate
- Pricing subject to material/packaging changes
- Freight excluded unless stated
- Testing/tooling/development charges
- Taxes
C. Purchase Orders
1. Submission and Acceptance of Purchase Orders
All customer purchase orders ("Purchase Orders" or "POs") are subject to review and acceptance by BPI Labs, Inc. dba Ally Labs ("Ally Labs").
Submission of a Purchase Order by a customer does not, by itself, constitute acceptance of an order by Ally Labs or create an obligation for Ally Labs to manufacture, purchase materials, reserve production capacity, or provide goods or services.
A Purchase Order shall become binding upon Ally Labs only when Ally Labs expressly accepts the Purchase Order in writing or otherwise provides written confirmation of the order through an authorized representative.
Ally Labs reserves the right to accept, reject, or request modification of any Purchase Order.
2. Required Purchase Order Information
Purchase Orders should include, as applicable:
- Customer legal name and billing information;
- Ally Labs quotation or proposal number;
- Product name and SKU;
- Product specifications or applicable specification reference;
- Quantity ordered;
- Unit price and total order value;
- Packaging configuration;
- Requested delivery date;
- Shipping destination;
- Customer Purchase Order number; and
- Any other information reasonably required by Ally Labs to process the order.
Incomplete or inaccurate Purchase Orders may delay acceptance, procurement, scheduling, production, testing, release, or shipment.
3. Ally Labs Quotations and Accepted Terms
Purchase Orders must correspond to the applicable Ally Labs quotation, proposal, specifications, and other agreed commercial terms.
If a Purchase Order differs from an Ally Labs quotation or other previously agreed terms with respect to price, quantity, specifications, packaging, testing, payment terms, delivery requirements, or other material terms, Ally Labs may reject the Purchase Order or require written resolution of the discrepancy before accepting the order.
Ally Labs' performance of an order shall not constitute acceptance of an unauthorized modification contained in a customer's Purchase Order.
4. Customer Purchase Order Boilerplate
Any standard, preprinted, electronic, incorporated-by-reference, or other terms and conditions contained in or accompanying a customer's Purchase Order, procurement system, vendor portal, acknowledgment, email, invoice-processing system, supplier manual, website, or other customer document are expressly rejected unless specifically accepted in writing by an authorized representative of Ally Labs.
Customer terms shall not modify, supplement, supersede, or replace the Ally Labs Customer Terms & Conditions, an accepted Ally Labs quotation, or any applicable executed agreement.
Without limiting the foregoing, Ally Labs does not accept conflicting or additional customer terms concerning warranties, indemnification, limitation of liability, consequential damages, recalls, product liability, intellectual property, cancellation rights, chargebacks, penalties, payment terms, governing law, venue, dispute resolution, insurance, confidentiality, or regulatory responsibility unless Ally Labs expressly agrees to those terms in writing.
5. No Acceptance by Performance
Ally Labs' acceptance, acknowledgment, or processing of a Purchase Order, or its commencement or continuation of any work relating to a Purchase Order, shall not constitute acceptance of any additional, inconsistent, or conflicting terms proposed by the customer.
Without limiting the foregoing, Ally Labs' procurement of raw materials or packaging, scheduling of production, commencement of product development, formulation, testing or manufacturing, manufacture or shipment of products, issuance of an invoice, acceptance of payment, or other performance shall not constitute acceptance of any terms contained in a customer's Purchase Order, procurement portal, vendor agreement, supplier manual, acknowledgment, email, website, or other customer document that conflict with or add to the applicable Ally Labs terms.
Any additional, inconsistent, or conflicting customer terms are expressly rejected and shall not modify, supplement, or supersede the applicable Ally Labs Customer Terms & Conditions, accepted quotation, or other governing agreement.
No additional or conflicting customer term shall become binding upon Ally Labs unless Ally Labs expressly agrees to that specific term in a written agreement or amendment signed by an authorized representative of Ally Labs.
For clarity, Ally Labs' performance of an order constitutes acceptance of the mutually agreed commercial requirements of that order, such as the applicable product, quantity, specifications, pricing, and delivery requirements, but does not constitute acceptance of the customer's standard or boilerplate legal terms.
D. Forecasts
Customer forecasts are nonbinding unless Ally specifically accepts a commitment.
E. Minimum Order Quantities
MOQ requirements will be dealt with on a case by case basis.
F. Deposits & Payment
Establish:
- Deposit requirements
- Payment terms
- Late payments
- Interest/fees where legally permissible
- Credit holds
- Right to suspend production
G. Raw Materials & Packaging
The customer should remain responsible for the committed inventory if that was authorized.
Cover:
- Supplier MOQs
- Customer-specific materials
- Custom packaging
- Printed packaging
- Ingredients
- Obsolete inventory
- Discontinued projects
- Storage
- Customer-supplied materials
H. Formulation & Product Development
Customer formula — customer retains ownership.
Ally pre-existing formula/platform — Ally retains ownership.
Custom formula developed by Ally — ownership determined by development agreement/quote.
I. Specifications
Production follows mutually approved specifications.
Customer changes after approval may trigger:
- New quote
- Additional testing
- Development fees
- New lead time
- New MOQ
J. Regulatory Responsibilities
Ally remains responsible for manufacturing obligations legally applicable to Ally.
Customer is responsible for customer-controlled:
- Brand claims
- Advertising
- Marketing
- Distribution
- Customer-supplied artwork
- Customer-directed claims
- Intended uses
- Customer-provided formulas/specifications
K. Label & Artwork Approval
Require written customer approval before production.
Customer should be responsible for final customer-controlled artwork and claims.
L. Testing
The following defines who is responsible for the following testing:
- Stability (Ally Labs)
- Microbial testing (Ally Labs)
- Preservative efficacy (Ally labs can facilitate but the customer needs to Pay for 3rd party testing)
- Assay OTC testing (Ally Labs)
- Packaging compatibility (customer unless sourced)
- Claims substantiation (customer responsibility)
M. Manufacturing & CGMP
Ally will manufacture products according to the applicable manufacturing/quality requirements that legally apply to the product and facility.
N. Production Tolerances
Due to the nature of contract manufacturing, actual finished quantities may vary from the quantity stated on a Purchase Order as a result of normal manufacturing processes, including production yields, equipment requirements, line losses, filling tolerances, quality-control sampling, testing requirements, component variability, raw-material characteristics, and other reasonable manufacturing factors.
Because production requirements vary depending upon the product, formulation, packaging configuration, batch size, equipment, and manufacturing process, acceptable production tolerances, including permitted overages and shortages, will be discussed and mutually agreed upon by Ally Labs and the customer on a case-by-case basis prior to production.
The applicable production tolerance may be documented in an accepted quotation, product specification, Purchase Order acknowledgment, manufacturing agreement, or other written communication between Ally Labs and the customer.
Unless otherwise agreed in writing, customers will be invoiced based upon the actual quantity of conforming finished goods produced and released, subject to the mutually agreed production tolerance.
Ally Labs will use commercially reasonable efforts to produce quantities as close as reasonably practicable to the ordered quantity while maintaining applicable product specifications, quality standards, and manufacturing requirements.
Any production quantity outside the mutually agreed tolerance will be communicated to the customer, and the parties will determine the appropriate disposition on a case-by-case basis.
Nothing in this Section permits Ally Labs to knowingly produce quantities materially exceeding or falling below the agreed production tolerance without customer authorization, except where reasonably necessary to address an unforeseen manufacturing, quality, safety, or regulatory issue.
O. Lead Times
Lead times are estimates unless specifically guaranteed in writing.
Ally is not responsible for delays caused by:
- Customer changes
- Supplier shortages
- Packaging delays
- Raw-material shortages
- Testing
- Regulatory issues
- Force majeure
P. Inspection & Acceptance
1. Customer Inspection Upon Receipt
Customer shall inspect all products promptly upon receipt and before further processing, filling, repackaging, relabeling, distribution, resale, or other use.
Customer's inspection shall include, as reasonably applicable, verification of:
- Product identity and quantity;
- Lot or batch information;
- Shipping condition;
- Visible damage;
- Packaging condition and integrity;
- Obvious labeling or packaging errors;
- Product appearance and other readily observable characteristics; and
- Conformity with the applicable Purchase Order and mutually approved specifications to the extent reasonably ascertainable through ordinary receiving inspection.
2. Notice of Visible Defects, Damage, Shortages or Nonconformities
Customer shall notify BPI Labs, Inc. dba Ally Labs ("Ally Labs") in writing of any visible or reasonably discoverable shortage, shipping discrepancy, damage, packaging defect, labeling discrepancy, or other apparent nonconformity within ten (10) business days after receipt of the affected products.
The notice shall reasonably identify:
- The affected product;
- Purchase Order number;
- Lot or batch number;
- Quantity affected;
- Nature of the alleged defect, damage, shortage, or nonconformity; and
- Supporting photographs, records, or other documentation reasonably available to Customer.
Failure to provide timely written notice of a visible or reasonably discoverable nonconformity shall constitute acceptance of the products with respect to that condition, to the fullest extent permitted by applicable law.
3. Shipping Damage
Customer shall inspect shipments for visible freight or transportation damage at the time of delivery and shall note any apparent damage, shortage, or irregularity on the applicable carrier documentation where reasonably practicable.
Customer shall promptly notify Ally Labs of material transportation damage involving products shipped by Ally Labs.
Responsibility for loss or damage occurring during transportation shall be determined in accordance with the applicable shipping terms, freight terms, risk-of-loss provisions, and carrier responsibility.
4. Latent Defects
Acceptance of products following receiving inspection shall not, by itself, waive a valid claim for a latent defect that could not reasonably have been discovered during ordinary inspection upon receipt.
Customer shall notify Ally Labs in writing promptly after discovering any alleged latent defect and, in all events, within the applicable warranty period.
Latent-defect claims shall be subject to the Limited Product Warranty and Exclusive Remedies, claim procedures, exclusions, and Limitation of Liability provisions contained in these Customer Terms & Conditions.
5. Use, Processing or Distribution Constitutes Acceptance
Except with respect to a latent defect that could not reasonably have been discovered before such activity, products shall be deemed accepted if Customer, or a third party acting on Customer's behalf:
- Uses or consumes the products;
- Fills or packages bulk product;
- Repackages or relabels the products;
- Modifies, blends, dilutes, reformulates, or otherwise processes the products;
- Incorporates the products into another product;
- Distributes or ships the products to a distributor, retailer, fulfillment center, consumer, or other third party;
- Offers the products for commercial sale; or
- Otherwise exercises ownership or control over the products in a manner inconsistent with rejection.
Customer shall therefore complete commercially reasonable receiving inspections before further processing or distribution.
6. Rejection of Products
Customer may reject products only for a material nonconformity with the mutually approved formulation, specifications, accepted Purchase Order, or applicable express warranty.
Any rejection must be made in writing and must reasonably describe the basis for rejection.
Customer may not reject an entire shipment or production lot based upon an alleged defect affecting only a portion of the shipment unless the nature of the defect reasonably indicates that the entire shipment or lot may be materially affected.
7. Preservation of Allegedly Nonconforming Product
Customer shall preserve allegedly defective or nonconforming products in substantially the condition in which the alleged issue was discovered and shall store such products under appropriate conditions pending investigation.
Customer shall not destroy, dispose of, return, rework, modify, or otherwise alter allegedly nonconforming products without Ally Labs' prior written authorization, except where immediate action is reasonably necessary to address a health, safety, regulatory, or legal requirement.
Upon reasonable request, Customer shall provide Ally Labs with samples, photographs, packaging, testing results, storage records, distribution information, and other information reasonably necessary to investigate the claim.
8. Ally Labs' Right to Investigate
Ally Labs shall have a reasonable opportunity to inspect, sample, test, and investigate any product alleged to be defective or nonconforming.
Ally Labs may review relevant batch records, specifications, certificates of analysis, retained samples, testing results, packaging records, shipping information, and other appropriate documentation.
Ally Labs' investigation of a claim, acceptance of samples, or discussion of a potential corrective action shall not, by itself, constitute an admission that the product is defective or that Ally Labs is responsible for the alleged condition.
9. Unauthorized Returns
Customer shall not return products to Ally Labs without prior written authorization.
Products returned without authorization may be refused, returned to Customer, or held at Customer's expense, subject to applicable law and safety or regulatory requirements.
Authorization to return products does not constitute acceptance of Customer's claim or an admission of liability by Ally Labs.
10. Remedies for Valid Claims
If Ally Labs determines following reasonable investigation that products contain a covered defect or material nonconformity attributable to Ally Labs, Customer's remedies shall be those provided under the Limited Product Warranty and Exclusive Remedies provisions of these Customer Terms & Conditions.
Except as otherwise required by applicable law or expressly agreed in writing, Customer shall not independently deduct, offset, charge back, or withhold amounts from amounts owed to Ally Labs based upon an alleged product defect or nonconformity before the claim has been investigated and resolved.
11. Relationship to Quality Agreement
Where Ally Labs and Customer have entered into an executed Quality Agreement containing specific inspection, sampling, testing, release, complaint, investigation, or rejection procedures, the Quality Agreement shall control those quality and regulatory procedures.
Financial responsibility, warranties, remedies, damages, and liability shall remain governed by the applicable Manufacturing Agreement and these Customer Terms & Conditions unless expressly agreed otherwise in writing.
Q. Nonconforming Products
process:
Customer reports problem → Ally investigates → retained samples/testing reviewed → determination made → appropriate remedy.
R. Limited Warranty
1. Limited Product Warranty
BPI Labs, Inc. dba Ally Labs ("Ally Labs") warrants to the original customer ("Customer") that products manufactured by Ally Labs will:
1. Be manufactured in material accordance with the formulation and finished-product specifications approved in writing by the Customer; and
2. Be free from defects in materials and workmanship attributable to Ally Labs that are discovered and reported to Ally Labs within one (1) year from the date of delivery of the applicable product to the Customer.
This limited warranty applies only to defects or nonconformities attributable to Ally Labs and does not apply to defects, shortages, damage, or nonconformities that were discovered, or reasonably should have been discovered, during the Customer's inspection of the products following receipt and that were not timely reported in accordance with the applicable inspection and acceptance provisions of these Customer Terms & Conditions.
2. Exclusive Remedy for Valid Warranty Claims
Subject to the terms, exclusions, and limitations contained in this Section, if Ally Labs determines that a product contains a defect in materials or workmanship attributable to Ally Labs or materially fails to conform to the Customer-approved formulation or specifications, the Customer's sole and exclusive remedy, and Ally Labs' sole obligation, shall be for Ally Labs, at its discretion and as reasonably appropriate under the circumstances, to:
1. Arrange for pickup or return of the affected product from the Customer's facility or warehouse to which Ally Labs originally shipped the product;
2. Reprocess, reformulate, rework, or replace the affected product with conforming product ("Corrected Product"); and
3. If Ally Labs originally filled the affected bulk product into Customer-approved containers, refill the Corrected Product into reusable containers or, if the original containers cannot reasonably be reused, reimburse or credit the Customer for the reasonable replacement cost of substantially equivalent containers, not to exceed the Customer's documented best available net cost for such containers.
Ally Labs shall determine the appropriate corrective action following reasonable investigation of the alleged defect or nonconformity.
3. Products Filled or Packaged by Customer or Third Parties
If bulk product manufactured by Ally Labs is subsequently filled, packaged, repackaged, processed, modified, blended, diluted, or otherwise handled by the Customer or a third party designated by the Customer, the bulk product shall be deemed accepted by the Customer upon commencement of such activity.
The warranty provided under this Section shall not apply to defects, contamination, deterioration, incompatibility, damage, or other nonconformities arising after the bulk product has been filled, packaged, processed, modified, or otherwise handled by the Customer or a third party.
Nothing in this provision excludes responsibility for a manufacturing defect attributable to Ally Labs that existed at the time the bulk product was delivered and could not reasonably have been identified before the subsequent filling, packaging, or processing, to the extent such responsibility cannot lawfully be excluded.
4. Packaging and Customer Distribution
Except where loss or damage occurs while the applicable materials or products are in the possession or control of Ally Labs, Ally Labs shall not be responsible for:
1. Replacement, reprinting, reworking, or repackaging of display packaging, cartons, labels, printed inserts, shipping boxes, shipping containers, promotional materials, or other secondary or tertiary packaging;
2. Costs associated with retrieving, removing, transporting, handling, or recovering products from the Customer's distributors, retailers, wholesalers, fulfillment centers, consumers, or other customers; or
3. Retailer fees, distributor fees, chargebacks, penalties, lost shelf space, lost sales, administrative fees, disposal charges, or similar downstream costs.
If affected packaged products cannot reasonably be recovered from the Customer's customer, distributor, retailer, or other downstream party, Ally Labs' obligation shall be limited to the remedy otherwise available under this Limited Warranty for the affected product, subject to all limitations contained in these Customer Terms & Conditions.
5. Warranty Exclusions
This Limited Warranty does not apply to any defect, damage, deterioration, failure, or nonconformity caused in whole or in part by circumstances not attributable to Ally Labs, including:
- Misuse, abuse, neglect, or improper use of the product;
- Modification, alteration, dilution, blending, processing, or repackaging after delivery;
- Improper product selection or use;
- Failure to follow applicable instructions, specifications, or handling requirements;
- Improper transportation, handling, warehousing, or storage after delivery;
- Exposure to inappropriate temperatures, humidity, light, environmental conditions, or contaminants after delivery;
- Incompatible or defective packaging selected, supplied, specified, or approved by the Customer;
- Customer-supplied ingredients, components, packaging, specifications, formulas, artwork, or materials;
- Failure of the Customer or a third party to comply with applicable laws, regulations, codes, specifications, or product requirements;
- Use of the product outside its approved or intended application;
- Acts or omissions of the Customer, its customers, distributors, retailers, carriers, warehouses, contractors, or other third parties; or
- Any condition otherwise expressly excluded under an applicable written agreement.
6. Warranty Claim Procedure
The Customer must notify Ally Labs in writing promptly after discovering an alleged defect or nonconformity and within the applicable warranty period.
The notice should reasonably identify the affected product, lot or batch number, quantity affected, nature of the alleged defect, date of discovery, and other information reasonably necessary for Ally Labs to investigate the claim.
The Customer shall preserve the affected product and, upon reasonable request, provide Ally Labs with samples, photographs, records, testing information, packaging, and other materials reasonably necessary to investigate the claim.
Ally Labs shall have a reasonable opportunity to inspect, test, and investigate the affected product before the Customer destroys, disposes of, returns, reworks, recalls, or otherwise alters the product, except where immediate action is reasonably necessary to address a safety or regulatory concern.
No warranty claim shall be considered accepted solely because Ally Labs receives, investigates, tests, or discusses the claim.
7. Disclaimer of Other Warranties
Ally Labs does not warrant or guarantee the commercial success, consumer acceptance, marketability, sales performance, regulatory approval, retail acceptance, or fitness of a Customer's product for a Customer-selected use unless expressly agreed otherwise in writing.
8. Exclusive Remedy
No representative, employee, salesperson, or agent of Ally Labs is authorized to create or provide any additional product warranty unless expressly authorized to do so in a written agreement signed by an authorized representative of Ally Labs.
9. Exclusion of Consequential and Other Damages
Without limiting the foregoing, excluded damages include, to the fullest extent permitted by applicable law, lost profits, lost revenue, lost business opportunities, loss of goodwill, loss of anticipated savings, business interruption, retailer or distributor penalties, and other consequential commercial losses.
10. Maximum Liability
If any limitation of remedy or exclusion of damages contained in this Section is determined by a court of competent jurisdiction to be unenforceable, Ally Labs' aggregate liability arising out of or relating to the affected transaction shall, to the fullest extent permitted by applicable law, not exceed the amounts actually paid to Ally Labs by the Customer for the specific products giving rise to the claim.
This limitation applies regardless of the legal theory upon which the claim is based, except to the extent that applicable law prohibits limitation of a particular liability.
11. Relationship to Other Agreements
This Limited Warranty is subject to any applicable Manufacturing Agreement, Quality Agreement, accepted quotation, product specifications, and other written agreement between Ally Labs and the Customer.
In the event of a conflict, the applicable Order of Precedence provisions of these Customer Terms & Conditions shall determine which provision controls.
Nothing in this Limited Warranty is intended to eliminate or disclaim any manufacturing, quality, safety, regulatory, or other obligation imposed directly upon Ally Labs by applicable law that cannot lawfully be waived or limited by contract.
S. Recalls
1. Notification and Cooperation
If either BPI Labs, Inc. dba Ally Labs ("Ally Labs") or the Customer becomes aware of any actual or suspected product defect, contamination, adulteration, misbranding, safety concern, regulatory issue, adverse event, or other circumstance that may reasonably result in a product recall, market withdrawal, stock recovery, field correction, safety notice, or other corrective action ("Recall"), that party shall notify the other party promptly.
Ally Labs and the Customer shall reasonably cooperate in investigating the circumstances giving rise to the potential Recall, including reviewing applicable manufacturing records, batch records, testing results, specifications, retained samples, complaints, distribution information, and other relevant documentation.
2. Recall Decisions
Decisions concerning whether to initiate a Recall shall be made in accordance with applicable law and regulatory requirements and, where reasonably practicable, following consultation between Ally Labs and the Customer.
Nothing in these Customer Terms & Conditions shall prevent either party from taking action that it reasonably determines is necessary to comply with applicable law, protect public health or safety, or respond to a directive or request from the U.S. Food and Drug Administration ("FDA") or other governmental authority.
The party initiating a Recall shall promptly notify the other party of material communications with governmental authorities concerning the Recall to the extent legally permissible.
3. Allocation of Recall Costs
Responsibility for reasonable and documented Recall costs shall be allocated based upon the cause of the Recall.
If a Recall results primarily from a manufacturing defect, contamination, processing error, failure to follow mutually approved specifications, or other breach attributable to Ally Labs, Ally Labs shall be responsible for reasonable Recall costs to the extent provided under the applicable Manufacturing Agreement, Quality Agreement, Limited Warranty, and Limitation of Liability provisions.
If a Recall results primarily from an act, omission, decision, specification, material, representation, or other matter attributable to the Customer or a third party under the Customer's direction or control, the Customer shall be responsible for the associated Recall costs.
Customer-responsible circumstances may include, without limitation:
- Customer-directed or Customer-approved labeling, artwork, warnings, instructions, or product claims;
- False, misleading, unsupported, unauthorized, or unlawful marketing or advertising claims;
- Customer-supplied formulations, specifications, ingredients, raw materials, components, or packaging;
- Packaging incompatibility where the packaging was selected, supplied, specified, or required by the Customer;
- Improper storage, transportation, handling, modification, repackaging, distribution, or use after the product leaves Ally Labs' control;
- Customer changes to a product after release by Ally Labs;
- Distribution or sale of product contrary to Ally Labs' written instructions or applicable specifications; or
- Customer noncompliance with applicable legal or regulatory requirements.
4. Shared Responsibility
If a Recall results from acts or omissions attributable to both Ally Labs and the Customer, the parties shall allocate reasonable and documented Recall costs in proportion to their respective responsibility for the circumstances giving rise to the Recall.
If the parties cannot agree upon the allocation of responsibility, the matter shall be handled pursuant to the dispute-resolution provisions of the applicable agreement.
5. Recall Expenses
Subject to the applicable warranty, indemnification, and limitation-of-liability provisions, Recall costs may include reasonable and documented direct expenses necessarily incurred in conducting the Recall, including:
- Required customer or distributor notifications;
- Reasonable shipping and transportation expenses;
- Retrieval of affected product;
- Reasonable storage, handling, and segregation costs;
- Required destruction or disposal of affected product;
- Reasonable testing and investigation expenses;
- Replacement or rework of affected product where appropriate; and
- Other reasonable direct expenses required by applicable law or a governmental authority.
Unless expressly agreed otherwise in writing, Recall costs shall not include lost profits, lost sales, loss of market share, loss of goodwill, loss of business opportunities, retailer penalties, consequential damages, punitive damages, or other indirect or special damages, subject to applicable law.
6. Regulatory Communications
Each party shall reasonably cooperate regarding communications with the FDA or other applicable governmental authorities concerning a Recall.
Neither party shall knowingly make materially inaccurate statements concerning the other party's actions or responsibilities.
Nothing in this Section restricts either party from communicating directly with a governmental authority where required by law or where reasonably necessary to address an immediate public-health, product-safety, or regulatory concern.
7. Traceability and Records
Each party shall maintain records within its possession or control that are reasonably necessary to support product traceability and Recall activities, consistent with applicable law and the applicable Quality Agreement.
The Customer shall maintain appropriate distribution records sufficient to identify, to the extent reasonably practicable, the customers, distributors, retailers, fulfillment centers, or other recipients to whom affected products were distributed.
8. Customer-Initiated Commercial Withdrawals
If the Customer elects to withdraw, replace, repackage, relabel, reformulate, or discontinue a product for commercial, marketing, branding, retailer, or other reasons unrelated to a defect, breach, or regulatory noncompliance attributable to Ally Labs, all costs associated with such action shall be the Customer's responsibility.
Such action shall not constitute a Recall attributable to Ally Labs.
9. No Admission of Liability
Participation by either party in an investigation, Recall, market withdrawal, product retrieval, regulatory communication, testing, replacement, or other corrective action shall not, by itself, constitute an admission of fault, defect, negligence, breach, or legal liability.
10. Relationship to Quality Agreement and Other Terms
For products subject to an executed Quality Agreement, the Quality Agreement shall govern operational procedures for complaints, investigations, regulatory notifications, recalls, withdrawals, and corrective actions.
The allocation of financial responsibility and liability shall remain subject to the applicable Manufacturing Agreement, Customer Terms & Conditions, Limited Warranty, Indemnification, and Limitation of Liability provisions unless expressly stated otherwise in an executed written agreement.
T. Indemnification
Indemnification will be mutual and cause-based.
Customer indemnifies Ally for claims arising from customer-controlled matters such as:
- Unauthorized claims
- Customer artwork
- Customer-supplied formulas
- IP infringement from customer materials
- Customer marketing
- Customer misuse/modification
- Regulatory violations attributable to customer conduct
Ally indemnifies the customer where appropriate for claims arising from Ally's breach, negligence, willful misconduct, or manufacturing failures attributable to Ally, subject to negotiated limitations.
U. Limitation of Liability
1. Exclusion of Consequential and Other Damages
This exclusion applies regardless of whether the claim arises under contract, warranty, indemnity, negligence, tort, strict liability, statute, or any other legal or equitable theory and regardless of whether Ally Labs was advised of or could reasonably have anticipated the possibility of such damages.
2. Excluded Commercial Losses
To the fullest extent permitted by applicable law, Ally Labs shall not be liable for:
- Lost profits or revenue;
- Lost sales or business opportunities;
- Loss of anticipated savings;
- Loss of market share;
- Loss of goodwill or reputation;
- Business interruption;
- Loss of customers or retail placement;
- Retailer, distributor, marketplace, or third-party penalties, fines, deductions, chargebacks, or administrative fees;
- Customer advertising, marketing, promotional, or launch expenses;
- Costs resulting from delayed product launches or missed promotional opportunities;
- Customer commitments to retailers, distributors, consumers, or other third parties; or
- Other indirect, incidental, special, exemplary, punitive, or consequential commercial losses.
3. Maximum Aggregate Liability
Where a claim relates only to a particular batch, lot, shipment, or portion of an order, the liability cap shall be limited to the amounts actually paid to Ally Labs for the affected batch, lot, shipment, or portion giving rise to the claim.
Multiple claims arising from the same product, batch, lot, Purchase Order, event, condition, or substantially related series of events shall not increase the applicable liability cap.
4. Product Defects and Warranty Claims
Claims involving an alleged manufacturing defect, nonconforming product, or breach of product warranty shall be subject to the Limited Product Warranty and Exclusive Remedies provisions of these Customer Terms & Conditions.
Where applicable, Customer's sole and exclusive remedy shall be the reprocessing, reformulation, rework, replacement, credit, or other remedy expressly provided under the Limited Product Warranty.
Customer may not recover both a warranty remedy and additional damages for the same loss.
5. Customer-Controlled Matters
Ally Labs shall not be responsible for damages, losses, liabilities, penalties, or expenses resulting from matters outside Ally Labs' reasonable control or matters attributable to Customer or a third party, including:
- Customer-approved or Customer-directed product claims, labeling, artwork, advertising, or marketing;
- Customer-supplied formulas, specifications, ingredients, components, packaging, or other materials;
- Improper storage, transportation, handling, distribution, modification, repackaging, or use after product leaves Ally Labs' control;
- Packaging incompatibility where packaging was selected, supplied, specified, or required by Customer;
- Customer's failure to comply with applicable laws or regulatory requirements;
- Customer's use or distribution of product contrary to approved specifications or written instructions; or
- Acts or omissions of Customer's distributors, retailers, fulfillment providers, carriers, contractors, customers, or other third parties.
6. Recalls
Liability relating to any product recall, market withdrawal, stock recovery, field correction, or other corrective action shall be governed by the Product Recalls, Withdrawals and Corrective Actions provisions of these Customer Terms & Conditions.
The allocation of Recall costs shall be based upon the cause of the Recall and shall remain subject to the applicable limitations and exclusions of liability contained in these Customer Terms & Conditions, except to the extent otherwise expressly agreed in writing or prohibited by applicable law.
7. Essential Basis of the Agreement
Customer acknowledges that the pricing and commercial terms offered by Ally Labs reflect the allocation of risk established by these Customer Terms & Conditions.
The limitations of liability, warranty limitations, exclusions of damages, and exclusive remedies contained herein constitute an essential basis of the agreement between Ally Labs and Customer and shall apply notwithstanding the failure of the essential purpose of any limited remedy, to the fullest extent permitted by applicable law.
8. Exceptions Required by Law
Nothing in these Customer Terms & Conditions is intended to exclude, waive, or limit any liability that cannot lawfully be excluded, waived, or limited under applicable law.
Nothing in this Section shall relieve Ally Labs of any manufacturing, quality, safety, regulatory, or other legal obligation directly imposed upon Ally Labs that cannot lawfully be transferred, waived, or limited by contract.
9. Survival
The limitations, exclusions, and liability caps contained in this Section shall survive completion, cancellation, expiration, or termination of the applicable Purchase Order, manufacturing relationship, or other agreement between Ally Labs and Customer.
V. Insurance
1. Ally Labs Insurance
During the term of its manufacturing relationship with Customer, BPI Labs, Inc. dba Ally Labs ("Ally Labs") shall maintain, at its own expense, commercially reasonable insurance coverage appropriate to the nature and scope of the manufacturing and related services being provided.
2. Customer Insurance
During any period in which Customer markets, sells, distributes, or otherwise commercially exploits products manufactured, developed, filled, packaged, or supplied by Ally Labs, Customer shall maintain, at its own expense, insurance coverage appropriate to the nature of its products and business.
3. Higher-Risk or Regulated Products
For certain products or projects presenting increased regulatory, product-liability, safety, or commercial exposure, Ally Labs may require Customer to maintain higher insurance limits or additional types of insurance as a condition of accepting or continuing the project.
Such products or projects may include, as applicable, OTC drug products, medical devices, products making therapeutic or other regulated claims, products intended for sensitive populations, or other products Ally Labs reasonably determines present increased risk.
Any additional insurance requirements will be communicated to Customer and agreed upon as part of the applicable quotation, Manufacturing Agreement, Quality Agreement, or other project-specific documentation.
4. Product Recall Insurance
Where commercially reasonable based upon the nature, volume, distribution, or risk profile of the applicable products, Ally Labs may require Customer to maintain product recall or contamination insurance.
Unless otherwise expressly agreed in writing, neither party's obligation to maintain general or product liability insurance shall be interpreted as an obligation to maintain product recall insurance.
The existence or absence of product recall insurance shall not alter the allocation of Recall responsibility established under the Product Recalls, Withdrawals and Corrective Actions provisions of these Customer Terms & Conditions.
5. Certificates of Insurance
Upon reasonable written request, each party shall provide the other with a certificate of insurance or other reasonable evidence demonstrating compliance with the insurance requirements applicable to that party.
A certificate of insurance is provided for informational purposes only and does not amend, expand, or modify the coverage provided by the applicable insurance policy.
6. Additional Insured Status
Where commercially appropriate and mutually agreed in writing, Customer may be required to name BPI Labs, Inc. dba Ally Labs and its applicable affiliates as additional insureds under Customer's Commercial General Liability and products liability coverage with respect to liabilities arising from Customer's marketing, sale, distribution, or other activities involving the applicable products.
Likewise, where required by an executed Manufacturing Agreement or other written agreement, Ally Labs may name Customer as an additional insured under applicable liability coverage to the extent commercially available and appropriate for liabilities arising from Ally Labs' manufacturing activities.
Any additional insured requirement shall be subject to the terms, conditions, exclusions, and endorsements of the applicable insurance policy.
7. Customer's Brand and Distribution Responsibilities
Customer acknowledges that Ally Labs' insurance is maintained in connection with Ally Labs' manufacturing operations and is not intended to replace Customer's own product liability insurance as the brand owner, marketer, seller, or distributor of the finished product.
Customer shall be responsible for maintaining appropriate insurance for risks associated with Customer's:
- Product claims and representations;
- Labeling and advertising;
- Marketing and promotional activities;
- Distribution and sale;
- Customer-selected intended uses;
- Customer-controlled regulatory obligations; and
- Acts or omissions occurring after products leave Ally Labs' possession or control.
8. Insurance Does Not Expand Liability
The insurance requirements contained in these Customer Terms & Conditions shall not be interpreted to increase, expand, or otherwise modify either party's contractual liability.
The existence of insurance coverage, policy limits greater than the contractual liability limits, or the availability of insurance proceeds shall not increase Ally Labs' liability beyond the limitations, exclusions, remedies, and liability caps established under these Customer Terms & Conditions or any applicable written agreement.
Nothing in this Section shall require either party to insure an obligation that is expressly excluded or limited under the applicable agreement.
9. Failure to Maintain Required Insurance
If Customer fails to maintain insurance required under this Section, Ally Labs may, after providing reasonable notice where appropriate, suspend manufacturing, shipment, or other services until satisfactory evidence of required coverage is provided.
Customer's failure to maintain required insurance shall not relieve Customer of any liability, indemnification obligation, or other responsibility otherwise imposed upon Customer under these Customer Terms & Conditions.
10. No Representation Regarding Adequacy of Coverage
The insurance limits specified in these Customer Terms & Conditions represent minimum contractual requirements only.
Neither party's acceptance of a certificate of insurance or other evidence of coverage constitutes a representation or warranty that the other party's insurance is sufficient to cover all potential liabilities or obligations.
Each party remains responsible for determining, in consultation with its insurance and legal advisors, the types and amounts of insurance appropriate for its business and activities.
W. Intellectual Property
- Trademarks
- Formulas
- Packaging
- Patents
- Trade secrets
- Customer-supplied IP
- Ally background IP
X. Confidentiality
Shall be covered on an individual basis in reference to the NDA.
Y. Termination/Cancellation
1. Cancellation or Modification of Orders
Once BPI Labs, Inc. dba Ally Labs ("Ally Labs") has accepted a Purchase Order, quotation, proposal, or other written authorization to proceed, the Customer may not cancel, reduce, postpone, reschedule, or materially modify the applicable order or project without Ally Labs' prior written consent.
Any approved cancellation, reduction, postponement, rescheduling, or modification shall be subject to the Customer's responsibility for costs, expenses, materials, work performed, and commitments reasonably incurred or made by Ally Labs in reliance upon the Customer's authorization.
2. Customer Responsibility for Noncancelable Commitments
If an order or project is cancelled, reduced, postponed, discontinued, or materially changed by the Customer after Ally Labs has been authorized to proceed, the Customer shall be responsible for all reasonable, documented, and noncancelable costs and commitments incurred by Ally Labs in connection with the affected order or project.
Such costs and commitments may include, without limitation:
- Purchased Ingredients and Raw Materials: Ingredients, chemicals, fragrances, active ingredients, bulk materials, processing aids, or other raw materials purchased or committed to specifically for the Customer's product or production requirements;
- Packaging and Components: Bottles, tubes, jars, closures, pumps, labels, cartons, inserts, cases, printed materials, custom packaging, or other packaging components ordered or committed to for the Customer;
- Supplier Minimum Order Quantities: Quantities Ally Labs is required to purchase from suppliers in excess of the Customer's immediate production requirements where such purchases were reasonably necessary to fulfill the Customer's authorized order;
- Scheduled or Committed Labor: Reasonable labor costs specifically committed to the Customer's project, including production setup or other project-specific labor that cannot reasonably be reassigned or avoided following cancellation;
- Production Already Commenced: Work-in-process, bulk product, partially completed product, completed product, production setup, line preparation, cleaning, processing, filling, packaging, or other manufacturing activities commenced before Ally Labs received and accepted the Customer's cancellation request;
- Testing and Quality Activities: Laboratory testing, stability testing, compatibility testing, microbial testing, analytical testing, validation, quality-control activities, outside laboratory charges, regulatory testing, or other testing initiated or completed for the Customer's product;
- Product Development: Formulation development, reformulation, samples, prototypes, pilot batches, scale-up activities, technical work, regulatory review, or other development services performed before cancellation;
- Tooling and Equipment: Molds, dies, plates, screens, printing plates, fixtures, tooling, equipment modifications, setup charges, or other Customer-specific manufacturing or packaging items created, purchased, modified, or committed to for the project;
- Third-Party Commitments: Noncancelable purchase orders, deposits, cancellation charges, supplier commitments, freight charges, outside services, or other third-party costs reasonably incurred by Ally Labs in reliance upon the Customer's authorization; and
- Finished Goods: Products completed before cancellation or products that Ally Labs cannot reasonably stop from being completed after receiving the Customer's cancellation request.
3. Payment Following Cancellation
Following cancellation, Ally Labs may provide the Customer with an invoice identifying applicable cancellation charges, completed work, materials, work-in-process, finished goods, and other noncancelable commitments.
Customer shall pay all undisputed amounts due in accordance with the payment terms stated on the applicable invoice or governing agreement.
Amounts already paid by Customer, including deposits or advance payments, may be applied against amounts properly due as a result of the cancellation.
If amounts properly due exceed deposits or advance payments held by Ally Labs, Customer shall pay the remaining balance.
4. Customer-Specific and Obsolete Inventory
Customer shall be responsible for Customer-specific inventory that cannot reasonably be used by Ally Labs for other customers or projects, including custom ingredients, unique formulations, printed packaging, branded components, labels, cartons, and other Customer-specific materials.
If Customer discontinues a product, changes its formulation, artwork, packaging, specifications, branding, or components, or otherwise causes existing Customer-specific inventory to become obsolete, Customer shall be responsible for the reasonable cost of such inventory to the extent the inventory was purchased or committed to with Customer's authorization or in reasonable reliance upon an accepted order or forecast that was expressly designated as binding.
5. Mitigation and Reusable Materials
Ally Labs will use commercially reasonable efforts to mitigate cancellation costs where practicable.
If unused materials can reasonably be returned to a supplier, repurposed for another customer, or otherwise used by Ally Labs without material loss, any actual recovery or avoided cost shall be taken into consideration when determining the Customer's cancellation responsibility.
Ally Labs shall not be required to accept supplier returns that result in unreasonable restocking charges, freight expenses, quality concerns, shortened shelf life, or other material costs or risks.
6. Disposition of Materials and Finished Goods
After payment of all applicable amounts, Ally Labs and Customer shall mutually determine the appropriate disposition of Customer-owned or Customer-paid materials, work-in-process, packaging, tooling, and finished goods, subject to applicable legal, regulatory, quality, and safety requirements.
Depending upon the circumstances, such materials may be:
- Delivered to Customer;
- Stored by Ally Labs subject to applicable storage charges;
- Returned to a supplier where commercially reasonable;
- Reworked or repurposed where mutually agreed; or
- Destroyed or disposed of at Customer's expense.
Ally Labs shall not be required to release products or materials where doing so would violate applicable law, regulatory requirements, quality requirements, or create a reasonable safety concern.
7. Postponed or Suspended Orders
If Customer requests that an accepted order be postponed or suspended rather than cancelled, Ally Labs may require Customer to pay for materials, packaging, work already performed, third-party commitments, and other costs incurred through the date of postponement.
Ally Labs may also charge reasonable storage, handling, inventory management, or rescheduling costs associated with maintaining Customer-specific materials or finished goods during an extended postponement.
A postponed order may be subject to revised pricing, production availability, raw-material availability, lead times, and other commercial terms when production resumes.
8. Cancellation by Ally Labs
Ally Labs may suspend performance or cancel an order upon reasonable notice if Customer:
- Fails to make required payments when due;
- Fails to provide required approvals, specifications, materials, artwork, information, or instructions;
- Materially breaches an applicable agreement;
- Fails to maintain required insurance;
- Requests or requires activity that Ally Labs reasonably believes would violate applicable law or regulatory requirements;
- Creates a material quality, safety, credit, or regulatory risk; or
- Becomes insolvent, files for bankruptcy, ceases operations, or demonstrates a material inability to satisfy its financial obligations.
Where reasonably practicable, Ally Labs will provide Customer an opportunity to cure a material breach before cancellation, except where immediate suspension or termination is reasonably necessary due to safety, regulatory, legal, quality, or significant financial concerns.
9. Effect of Termination
Cancellation, expiration, or termination of an order or business relationship shall not eliminate payment obligations or other liabilities that accrued before the effective date of cancellation or termination.
Provisions concerning payment obligations, confidentiality, intellectual property, Customer-specific inventory, indemnification, warranty limitations, limitation of liability, dispute resolution, and any other provisions that by their nature are intended to survive shall remain effective following cancellation or termination.
AA. Storage & Abandoned Inventory
1. Customer Responsibility for Timely Removal
Customer shall take delivery of finished goods and arrange for the removal or disposition of Customer-owned or Customer-specific materials within the timeframes established in the applicable Purchase Order, quotation, Manufacturing Agreement, or other written agreement.
Such materials may include finished goods, bulk product, work-in-process, raw materials, ingredients, packaging, labels, cartons, components, tooling, molds, fixtures, printed materials, samples, and other inventory purchased, produced, or maintained specifically for Customer ("Customer Inventory").
Ally Labs is not obligated to store Customer Inventory indefinitely unless expressly agreed in writing.
2. Storage Charges
If Customer fails to take delivery of finished goods or remove Customer Inventory within the agreed timeframe, BPI Labs, Inc. dba Ally Labs ("Ally Labs") may assess reasonable storage, handling, inventory-management, transportation, and related charges.
Any applicable storage rates may be established in the Customer's quotation, Purchase Order acknowledgment, Manufacturing Agreement, or other written communication.
If no storage rate has been previously established, Ally Labs may impose a commercially reasonable storage charge after providing reasonable written notice to Customer.
Storage charges may continue to accrue until the Customer Inventory is shipped, removed, returned, destroyed, disposed of, or otherwise resolved.
3. Delayed Acceptance of Finished Goods
Customer's failure or refusal to take timely delivery of conforming finished goods shall not delay or eliminate Customer's payment obligations.
Where finished goods have been manufactured in accordance with the applicable Purchase Order and approved specifications and are otherwise ready for release or shipment, Ally Labs may invoice Customer in accordance with the applicable payment terms notwithstanding Customer's requested delay in shipment.
Customer shall be responsible for reasonable additional costs resulting from the delayed shipment or acceptance.
4. Customer-Specific Materials
Customer shall remain financially responsible for Customer-specific ingredients, raw materials, packaging, labels, printed materials, components, tooling, and other inventory purchased or committed to with Customer's authorization or in reasonable reliance upon an accepted Purchase Order or other binding commitment.
Ally Labs shall not be required to retain Customer-specific materials beyond their reasonable shelf life, expiration date, retest date, useful life, or a reasonable storage period.
5. Expired, Obsolete or Unusable Inventory
Customer shall be responsible for Customer Inventory that becomes expired, obsolete, unusable, nonconforming, or commercially impractical to use as a result of:
- Customer's failure to place anticipated orders;
- Customer's discontinuation of a product;
- Changes to Customer's formulation or specifications;
- Changes to packaging, artwork, branding, labels, or components;
- Customer-requested postponement or suspension of production;
- Expiration or deterioration during an extended Customer-requested storage period; or
- Other Customer-directed changes that render previously authorized inventory unusable.
Ally Labs may require Customer to arrange for removal or authorize disposal of such inventory.
6. Notice of Unclaimed or Abandoned Inventory
If Customer fails to take delivery, provide disposition instructions, pay applicable storage charges, or otherwise address Customer Inventory after written notice from Ally Labs, Ally Labs may designate such inventory as unclaimed.
Ally Labs will provide Customer with reasonable written notice requesting that Customer take delivery of, pay amounts due with respect to, or provide disposition instructions for the affected inventory.
If Customer fails to respond or make reasonable arrangements within sixty (60) days after such notice, Ally Labs may exercise any rights and remedies available under the applicable agreement and applicable law with respect to the unclaimed inventory.
7. Disposition of Abandoned Inventory
Subject to applicable law and any required notices, Ally Labs may, after expiration of the applicable notice period, dispose of, destroy, recycle, return, sell where legally permissible, or otherwise handle abandoned Customer Inventory in a commercially reasonable manner.
Customer shall remain responsible for reasonable and documented costs associated with storage, handling, transportation, return, destruction, disposal, environmental compliance, or other necessary disposition of such inventory.
Any disposition of regulated products, OTC drug products, cosmetics, chemicals, ingredients, or other controlled or regulated materials shall be performed in accordance with applicable legal, regulatory, quality, safety, and environmental requirements.
8. Tooling and Customer-Owned Property
Customer-owned tooling, molds, dies, plates, fixtures, equipment, or other property maintained at Ally Labs' facility shall also be subject to reasonable storage and disposition requirements.
Ally Labs may require Customer to remove Customer-owned property that has not been used for an extended period, relates to a discontinued product, or is no longer reasonably necessary for an active Customer program.
Customer shall be responsible for reasonable costs associated with packaging, preparing, transporting, storing, or disposing of such property.
9. Risk During Extended Storage
Ally Labs will exercise commercially reasonable care in storing Customer Inventory while it remains in Ally Labs' possession.
However, Ally Labs does not guarantee the continued suitability, stability, shelf life, appearance, performance, or usability of materials or products stored beyond their originally anticipated storage period at Customer's request.
Customer assumes the risk of normal deterioration, expiration, obsolescence, or loss of useful life resulting from Customer-requested extended storage, except to the extent directly caused by Ally Labs' failure to exercise commercially reasonable care.
10. No Waiver of Payment Obligations
Storage, abandonment, destruction, disposal, return, or other disposition of Customer Inventory shall not relieve Customer of amounts properly due to Ally Labs for products manufactured, services performed, materials purchased, storage charges, disposal costs, or other authorized commitments.
Any amounts recovered by Ally Labs through the commercially reasonable sale or return of abandoned inventory, if legally permissible, shall be applied as required by applicable law.
11. Applicable Law
Nothing in this Section authorizes Ally Labs to retain, sell, destroy, dispose of, or otherwise exercise control over Customer property in a manner prohibited by applicable law.
Any abandonment, disposition, lien, sale, or other remedy involving Customer-owned property shall be exercised subject to applicable law and any legally required notice or procedural requirements.
AB. Force Majeure
1. Excused Performance
BPI Labs, Inc. dba Ally Labs ("Ally Labs") shall not be liable for any delay, interruption, shortage, failure to manufacture, failure to deliver, or other failure to perform its obligations to the extent caused by circumstances beyond Ally Labs' reasonable control (a "Force Majeure Event").
During a Force Majeure Event, Ally Labs' affected obligations shall be suspended or extended for the period reasonably necessary to address the Force Majeure Event and its effects.
2. Force Majeure Events
Force Majeure Events may include, without limitation:
- Acts of God or natural disasters;
- Fire, explosion, flood, earthquake, severe weather, wildfire, or other natural events;
- Epidemics, pandemics, public-health emergencies, quarantines, or government-imposed restrictions;
- War, invasion, hostilities, terrorism, civil unrest, riots, sabotage, or similar events;
- Government orders, embargoes, sanctions, import or export restrictions, changes in law, regulatory actions, or other governmental restrictions;
- Actions, orders, delays, inspections, holds, or restrictions imposed by the FDA or other governmental or regulatory authorities;
- Shortages, allocations, discontinuations, or unavailability of raw materials, active ingredients, chemicals, fragrances, packaging, containers, closures, labels, cartons, or other components;
- Supplier, vendor, or subcontractor failures or delays resulting from circumstances beyond Ally Labs' reasonable control;
- Transportation interruptions, carrier delays, port congestion, freight disruptions, shipping embargoes, or other logistics interruptions;
- Utility failures or interruptions, including electricity, natural gas, water, telecommunications, or internet services;
- Labor strikes, lockouts, work stoppages, or other labor disruptions;
- Cyberattacks, ransomware, significant information-system failures, or telecommunications disruptions not resulting from Ally Labs' failure to maintain commercially reasonable safeguards;
- Unexpected failure or breakdown of essential manufacturing equipment that could not reasonably have been prevented through commercially reasonable maintenance;
- Contamination, quarantine, or closure of a manufacturing area or facility requiring investigation or corrective action;
- Widespread shortages of labor or critical personnel resulting from circumstances beyond Ally Labs' reasonable control; or
- Any other event or circumstance beyond Ally Labs' reasonable control that materially prevents, delays, or interferes with performance.
3. Supply Chain and Material Availability
Ally Labs shall not be responsible for delays resulting from shortages, allocations, discontinuations, supplier delays, or other unavailability of ingredients, raw materials, packaging, or components that are beyond Ally Labs' reasonable control.
If an approved ingredient, material, or component becomes unavailable, Ally Labs may propose a commercially reasonable substitute. No substitute that materially affects the formulation, specifications, labeling, packaging, regulatory status, or quality of the product shall be used without Customer approval where such approval is reasonably required.
Any Customer-requested change resulting from material unavailability may require revised pricing, testing, specifications, lead times, or other commercial terms.
4. Allocation of Limited Capacity or Materials
If a Force Majeure Event results in limited manufacturing capacity, raw materials, packaging, components, utilities, or other resources, Ally Labs may allocate available resources among its customers, products, and contractual obligations in a commercially reasonable manner.
Nothing in this Section requires Ally Labs to purchase replacement materials or services at commercially unreasonable prices or incur extraordinary expenses to avoid or overcome a Force Majeure Event.
5. Notice and Mitigation
Ally Labs shall provide Customer with reasonable notice of a Force Majeure Event when Ally Labs becomes aware that the event is reasonably likely to materially affect Customer's order or delivery schedule.
Ally Labs shall use commercially reasonable efforts to mitigate the effects of the Force Majeure Event and resume affected performance when reasonably practicable.
6. Production and Delivery Schedules
Any production, completion, or delivery dates affected by a Force Majeure Event shall be extended for a commercially reasonable period based upon the nature and duration of the event and its resulting operational or supply-chain effects.
Such delay shall not constitute a breach of contract or entitle Customer to penalties, chargebacks, consequential damages, lost profits, or other damages arising from the delay, subject to applicable law.
7. Extended Force Majeure Events
If a Force Majeure Event materially prevents performance of an affected order for more than ninety (90) consecutive days, either party may request cancellation of the affected portion of the order upon written notice.
Before cancellation, the parties will reasonably attempt to determine whether the order can be rescheduled, modified, reformulated, or otherwise completed on commercially reasonable terms.
Cancellation resulting from a Force Majeure Event shall not relieve Customer of responsibility for finished goods, work already performed, or Customer-specific raw materials, packaging, components, tooling, testing, or other noncancelable commitments properly incurred before cancellation.
8. Payment Obligations
A Force Majeure Event shall not excuse or delay Customer's obligation to pay amounts already due for products delivered, services performed, materials purchased or committed to with Customer authorization, or other obligations accrued before the Force Majeure Event.
9. Customer-Caused Delays
Force Majeure does not include delays caused by Customer's failure to timely provide approvals, artwork, specifications, materials, payments, regulatory information, instructions, or other items required for Ally Labs to perform.
Such delays shall be governed by the applicable Purchase Order, cancellation, storage, scheduling, and other provisions of these Customer Terms & Conditions.
AC. Governing Law / Disputes
1. Governing Law
These Customer Terms & Conditions and any dispute, claim, controversy, or cause of action arising out of or relating to these Customer Terms & Conditions, any Purchase Order, quotation, product, manufacturing service, product-development service, or other transaction between BPI Labs, Inc. dba Ally Labs ("Ally Labs") and Customer shall be governed by and construed in accordance with the laws of the State of Wyoming, without regard to its conflict-of-laws principles that would require the application of the laws of another jurisdiction.
To the extent applicable to a transaction involving the sale of goods, the Uniform Commercial Code as adopted in the State of Wyoming shall apply, subject to any modifications, limitations, warranties, remedies, and other terms expressly agreed upon by the parties.
2. Good-Faith Resolution of Disputes
Before commencing litigation, Ally Labs and Customer shall use commercially reasonable, good-faith efforts to resolve any dispute arising from their business relationship.
Either party may provide written notice describing the dispute and the relief requested. Following such notice, appropriate representatives of the parties shall attempt in good faith to resolve the dispute through direct discussions.
If the dispute cannot reasonably be resolved through such discussions, either party may pursue the remedies available under the applicable agreement and applicable law.
Nothing in this Section requires a party to delay seeking temporary, preliminary, or emergency injunctive relief where reasonably necessary to protect confidential information, intellectual property, trade secrets, property, or other rights requiring immediate protection.
3. Exclusive Jurisdiction and Venue
Subject to any mutually agreed alternative dispute-resolution provision contained in an executed written agreement, any lawsuit, action, or judicial proceeding arising out of or relating to these Customer Terms & Conditions, any Purchase Order, quotation, product, service, or other transaction between Ally Labs and Customer shall be brought exclusively in a state or federal court of competent jurisdiction located in the State of Wyoming.
Where jurisdiction and applicable venue requirements permit, the parties agree that venue shall be in Uinta County, Wyoming, where Ally Labs maintains its principal manufacturing operations.
Each party knowingly and voluntarily submits to the personal jurisdiction of such courts and, to the fullest extent permitted by applicable law, waives any objection based upon improper venue, lack of personal jurisdiction, or inconvenient forum.
4. Customer Agreement to Wyoming Forum
Customer acknowledges that Ally Labs operates its manufacturing business in Wyoming and that selection of Wyoming law and a Wyoming forum bears a reasonable relationship to the parties' commercial transactions.
By submitting an order subject to these Customer Terms & Conditions, Customer agrees that Wyoming is an appropriate and reasonable forum for resolution of disputes arising from the parties' business relationship.
5. Equitable and Injunctive Relief
Notwithstanding the foregoing, Ally Labs may seek temporary, preliminary, or emergency injunctive or equitable relief in any court of competent jurisdiction where such relief is reasonably necessary to prevent actual or threatened misuse or disclosure of confidential information, infringement or misappropriation of intellectual property or trade secrets, unauthorized use of Ally Labs property, or other conduct for which monetary damages would not provide an adequate remedy.
Seeking such emergency relief outside Wyoming shall not constitute a waiver of the Wyoming governing-law or forum-selection provisions for the underlying dispute.
6. Attorneys' Fees and Costs
In any action or proceeding arising out of or relating to these Customer Terms & Conditions or the parties' commercial relationship, the prevailing party shall be entitled, to the extent permitted by applicable law, to recover its reasonable attorneys' fees and taxable court costs from the non-prevailing party.
For purposes of this Section, the "prevailing party" shall be the party that substantially prevails with respect to the principal claims or defenses at issue, as determined by the court.
7. Continued Performance During Dispute
To the extent commercially reasonable and legally permissible, the parties shall continue performing their undisputed obligations while a dispute is pending.
Customer shall not withhold payment of undisputed amounts because of a dispute concerning a separate invoice, batch, lot, product, Purchase Order, or claim.
Ally Labs reserves all contractual and legal rights relating to nonpayment, including the right to suspend production, purchasing, shipment, or other performance where permitted under the applicable agreement or law.
8. No Waiver of Regulatory Obligations
Nothing in this Section shall restrict either party from communicating with, reporting to, cooperating with, or responding to the U.S. Food and Drug Administration or any other governmental or regulatory authority where required or permitted by applicable law.
The parties' agreement regarding Wyoming law and venue does not alter any federal or state regulatory obligations independently applicable to Ally Labs, Customer, or the products involved.
9. Survival
The provisions of this Section shall survive completion, expiration, cancellation, or termination of any Purchase Order, manufacturing relationship, Customer Terms & Conditions, or other agreement between Ally Labs and Customer.
AD. Entire Agreement / Order of Precedence
1. Governing Documents
The commercial relationship between BPI Labs, Inc. dba Ally Labs ("Ally Labs") and Customer may be governed by multiple documents, including manufacturing agreements, quality agreements, quotations, Purchase Orders, specifications, and these Customer Terms & Conditions.
In the event of any conflict, inconsistency, ambiguity, or discrepancy among documents applicable to a transaction, the documents shall control in the following order of precedence, subject to the subject-matter limitations stated below:
FIRST PRIORITY — Executed Manufacturing Agreement
1. Executed Manufacturing Agreement
An executed Manufacturing Agreement, Supply Agreement, Master Services Agreement, or similar agreement signed by authorized representatives of both Ally Labs and Customer shall have the highest priority and shall control over all other documents with respect to commercial, legal, and business matters addressed by that agreement.
This includes, as applicable:
- Pricing methodology;
- Payment terms;
- Warranties;
- Indemnification;
- Limitation of liability;
- Insurance;
- Intellectual property;
- Confidentiality;
- Forecasting and purchasing obligations;
- Raw-material and packaging commitments;
- Cancellation and termination;
- Recalls and allocation of recall costs;
- Governing law;
- Dispute resolution; and
- Other negotiated commercial or legal terms.
A Manufacturing Agreement shall not, however, supersede a Quality Agreement with respect to a matter expressly designated in the Quality Agreement as a quality or regulatory responsibility, unless the Manufacturing Agreement specifically and expressly states that it is overriding the identified provision of the Quality Agreement.
SECOND PRIORITY — Quality Agreement
2. Executed Quality Agreement — Limited to Quality and Regulatory Matters
An executed Quality Agreement signed by authorized representatives of Ally Labs and Customer shall control with respect to quality, manufacturing-quality systems, testing, release, investigation, regulatory, and related technical responsibilities within its scope.
These matters may include:
- Current Good Manufacturing Practices (CGMP), where applicable;
- Product specifications and quality standards;
- Raw-material and component controls;
- Manufacturing and processing controls;
- Laboratory testing;
- Sampling;
- Batch records;
- Product release procedures;
- Stability responsibilities;
- Deviations and investigations;
- Out-of-specification results;
- Corrective and preventive actions (CAPA);
- Change control;
- Complaints and adverse-event procedures;
- Regulatory inspections;
- Regulatory notifications;
- Product traceability;
- Recall procedures;
- Record retention; and
- Other quality or regulatory responsibilities expressly assigned in the Quality Agreement.
The Quality Agreement controls only with respect to quality, technical, and regulatory matters within its stated scope.
Unless expressly stated otherwise, a Quality Agreement shall not modify commercial or legal terms concerning pricing, payment, indemnification, limitation of liability, insurance, ownership of intellectual property, cancellation charges, or other financial obligations established by the Manufacturing Agreement or these Customer Terms & Conditions.
For clarity, the Quality Agreement may establish how a Recall is conducted and each party's operational responsibilities, while the Manufacturing Agreement or Customer Terms & Conditions may establish which party bears the financial responsibility for the Recall.
THIRD PRIORITY — Accepted Ally Labs Quotation
3. Accepted Ally Labs Quotation or Proposal
An Ally Labs quotation, proposal, statement of work, or similar commercial document that has been accepted by Customer and Ally Labs shall control with respect to the specific commercial and product requirements stated in that document.
These matters may include:
- Product identification;
- Formulation;
- Specifications;
- Batch size;
- Minimum order quantity;
- Unit pricing;
- Development fees;
- Testing charges;
- Packaging;
- Tooling;
- Setup charges;
- Customer-specific materials;
- Supplier minimum order quantities;
- Deposits;
- Payment requirements specific to the project;
- Production tolerances;
- Lead-time assumptions; and
- Other project-specific commercial requirements.
A specific term contained in an accepted Ally Labs quotation shall control over a conflicting general term contained in these Customer Terms & Conditions with respect to that particular project or order.
An accepted quotation shall not modify an executed Manufacturing Agreement or Quality Agreement unless the quotation specifically identifies the provision being modified and the modification is approved in writing by authorized representatives of both parties.
FOURTH PRIORITY — Accepted Purchase Order
4. Accepted Customer Purchase Order
A Customer Purchase Order expressly accepted by Ally Labs shall control only with respect to mutually accepted order-specific and administrative information, including:
- Purchase Order number;
- Product or SKU;
- Quantity;
- Mutually accepted price;
- Requested or accepted delivery date;
- Shipping destination;
- Billing information; and
- Other mutually accepted administrative details specific to that order.
Customer boilerplate terms and conditions contained in, attached to, referenced by, linked from, or incorporated into a Purchase Order are expressly rejected and shall not modify, supplement, supersede, or replace any applicable Manufacturing Agreement, Quality Agreement, accepted Ally Labs quotation, or these Customer Terms & Conditions.
Ally Labs' acceptance of a Purchase Order constitutes acceptance only of the mutually agreed order-specific commercial and administrative information and does not constitute acceptance of Customer's standard or boilerplate legal terms.
FIFTH PRIORITY — Ally Labs Customer Terms & Conditions
5. Ally Labs Customer Terms & Conditions
These Customer Terms & Conditions shall govern all matters not specifically addressed by a higher-priority controlling document.
These Customer Terms & Conditions supplement the Manufacturing Agreement, Quality Agreement, accepted Ally Labs quotation, and accepted Purchase Order to the extent they are not inconsistent with the applicable higher-priority document.
Where a higher-priority document is silent concerning a particular issue, these Customer Terms & Conditions shall apply.
Summary of Contractual Hierarchy
For clarity, the parties expressly agree to the following hierarchy:
1. Executed Manufacturing Agreement
2. Executed Quality Agreement — solely for quality, technical, and regulatory matters
3. Accepted Ally Labs Quotation or Proposal — for project-specific commercial and product terms
4. Accepted Customer Purchase Order — solely for mutually accepted order-specific and administrative terms
5. Ally Labs Customer Terms & Conditions — governing all remaining matters
Specific Terms Control Over General Terms
Within documents of the same priority, a specifically negotiated term addressing the particular subject matter at issue shall control over a general provision addressing the same subject.
A project-specific provision shall apply only to the applicable product, project, or Purchase Order unless the parties expressly agree in writing that it applies more broadly.
Express Amendments
Notwithstanding the foregoing hierarchy, the parties may expressly agree in writing to modify the normal order of precedence for a particular provision.
Any such modification must:
1. Be in writing;
2. Specifically identify the provision or subject matter being modified;
3. Clearly state that the parties intend to modify or override the otherwise controlling provision; and
4. Be approved by authorized representatives of both Ally Labs and Customer.
A general statement that a document "supersedes all prior agreements" shall not override a specific provision of another governing document unless the affected provision or subject matter is clearly identified.
Rejection of Customer Boilerplate Terms
Any additional, inconsistent, or conflicting terms contained in Customer's Purchase Order, procurement portal, vendor onboarding system, supplier manual, acknowledgment, email, invoice-processing system, website, electronic platform, or other Customer-generated document are expressly rejected.
Such terms shall be considered proposals for modification only and shall not become part of the parties' agreement unless expressly accepted in a written amendment signed by an authorized representative of Ally Labs.
Ally Labs' acknowledgment or processing of a Purchase Order, purchase of materials, scheduling of production, commencement of development or manufacturing, shipment of goods, issuance of an invoice, acceptance of payment, or other performance shall not constitute acceptance of any additional or conflicting Customer terms.
No Modification by Course of Performance or Dealing
Except to the extent otherwise required by applicable law, no course of performance, course of dealing, trade usage, prior transaction, failure to object, or other conduct between the parties shall modify the foregoing order of precedence or constitute acceptance by Ally Labs of conflicting Customer terms.
Any modification of the governing contractual documents must satisfy the written-modification requirements contained in the applicable agreement.
Interpretation to Avoid Conflict
The governing documents shall, whenever reasonably possible, be interpreted consistently so that each document is given effect.
The order-of-precedence provisions shall apply only where provisions cannot reasonably be reconciled.
If a conflict remains, the higher-priority document shall control only with respect to the conflicting subject matter, and the remaining provisions of the lower-priority document shall remain in full force and effect.
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