Shipping and Fulfillment – Terms of Service

The Shipping and Fulfillment Services Agreement (“Agreement”), is between BlueDrone ("BlueDrone") and all of it’s clients. (“Client”). This serves as an addendum to the Terms of Use as found at which shall supersede this document in instances of conflict.

WHEREAS, BlueDrone ("BlueDrone") has the capability to provide certain order entry and fulfillment services for the Client’s direct response offerings, as set forth in service order provided previously.

WHEREAS, the Client’s use of BlueDrone shipping and fulfillment services shall be under the terms and conditions set forth in this Agreement.

Therefore, BlueDrone, henceforth referred to as “BlueDrone” and the Client agree as follows:

1. Merchandise Ownership

A. For the purposes of this Agreement, “Merchandise” means all products provided by the Client for sale or delivery to Client’s customers pursuant to this Agreement. The Client shall retain ownership of all Merchandise covered by this Agreement and risk of loss at all times. Legal title to the Merchandise remains with the Client until the Merchandise is shipped for delivery to the Client’s customer.

B. BlueDrone makes no claim of ownership of the Merchandise and shall act only as the Client’s independent contractor for the purposes of order processing, warehousing, distribution, and customer service for Merchandise as set forth in Exhibit A.

C. Client orders for the merchandise are with the Client. The Client is the seller of the merchandise.

2. Order Entry and Processing

A. BlueDrone shall process customer orders for Merchandise received by all media designated by the Client.

B. For each customer order taken, BlueDrone shall enter all or any part of the following information into its information systems: customer name, address, city, state, zip code, telephone number, email address, description and quantity of merchandise ordered, price, method of payment, advertising source codes, shipping instructions, and Client¬ requested messages or tokens.

C. All orders received from the client shall be passed from their CRM via an API to BlueDrone directly. Should orders come in a non-compliant format, BlueDrone may decline to process and/or fulfill the order.

D. Except as provided in Section 2E, BlueDrone shall promptly process all qualified requests and use its best efforts to cause the order to be shipped to the customer within three (3) business days after receipt of the order.

E. The Client shall provide sufficient advance notice of all media promotions to enable BlueDrone a reasonable amount of time to implement an order fulfillment program appropriate for the Client’s projected response forecast.

3. Sales and Use Taxes

A. Since title to the merchandise remains with the Client at all times, the Client is liable and responsible to remit all sales and use taxes to the appropriate taxing authorities. BlueDrone assumes no liability for payment of sales and use tax.

B. BlueDrone assumes no responsibility for determining whether sales of the Client’s merchandise are taxable in a given jurisdiction, or that the rate or method of calculating any such taxes is correct. BlueDrone agrees only to use reasonable care and skill in calculating and collecting taxes due based on the rates and methods supplied by the Client.

C. The Client shall indemnify, defend, and hold harmless BlueDrone and its shareholders, officers, directors, and employees from and against all claims, suits, or liabilities and expenses, including reasonable legal fees, for the Client’s failure to remit to the appropriate authorities any sales or use taxes claimed to be due and owing by reason of the Client’s sale of merchandise to its customers

4. Processing Payments

A. All payment processing and transaction management for the sale of the Client’s product, is the sole responsibility of the Client.

B. If BlueDrone shall receive mail including cash, checks, money orders, or credit card payments regarding the clients product, the receipt of such payments shall be promptly reported to Client. Such remittances shall be mailed to Client within three (3) business days.

C. BlueDrone is not responsible for any payments that are lost by carriers in transit to/from Client.

6. Customer Services

A. BlueDrone shall ship Merchandise to the customers by United Parcel Service, the United States Post Office, Federal Express, or equivalent delivery service consistent with the Client’s requirements for shipping and delivery of merchandise. BlueDrone is not responsible for any packages that are lost in transit after leaving its facilities.

B. BlueDrone shall send back-order notices and process customer returns in accordance with Client requests and applicable federal, state, and local laws. If established in Exhibit A, BlueDrone shall also respond to customer complaints.

C. BlueDrone shall issue appropriate UPS call tags, request proof of delivery, and process all necessary tracers and claims for non¬delivery or damage on behalf of the Client if requested. BlueDrone shall provide Client with proof of shipments but is not responsible in any way for the results of credit card charge-backs, nor any fees imposed by merchant banks. Client is responsible for vendor compliance guidelines.

7. Returns

A. BlueDrone shall instruct customers on the appropriate procedure for returning merchandise and accept all returned merchandise. If established BlueDrone shall inspect and repackage all undamaged or unused merchandise and return it to inventory for resale. BlueDrone shall repackage all damaged or unsalvageable merchandise, and process such merchandise in any manner designated by the Client at the Client’s expense

8. Operating Reports

A. BlueDrone shall provide the Client with standard system reports on a regular basis for all services provided pursuant to this Agreement. A listing of standard reports and their descriptions is available within the clients logins at

B. If special reports not provided as part of the standard reporting system are required, the Client shall pay BlueDrone for any programming expenses incurred

9. Compensation and Payment.

A. BlueDrone shall ship Merchandise to the customers by United Parcel Service, the United States Post Office, Federal Express, or equivalent delivery service consistent with the Client’s requirements for shipping and delivery of merchandise. BlueDrone is not responsible for any packages that are lost in transit after leaving its facilities.

B. If in the event the Client temporarily ceases marketing the product and communicates such plans in advance in writing to BlueDrone, then BlueDrone shall waive any minimum fee beginning with the first Monday of the next calendar month until the termination of this Agreement. During any period in which the minimum fee is waived, storage charges will be calculated at twice the normal rate.

C. If the Client then proceeds to market the product again during the term of the Agreement, the minimum charge shall again commence and shall continue until the termination of the Agreement.

D. Any and all financial arrangements not covered in this contract must be agreed upon, signed by each party, and attached to this contract.

E. The representative of Client, being an Officer of the Company, agrees to personally \ guarantee payment of any amount owed to BlueDrone upon termination of contract

10. Compliance with Laws

A. The Client shall comply with all applicable laws, regulations, and requirements of the Federal Trade Commission, the Food and Drug Administration, and any other governmental or quasi governmental agency that might have jurisdiction over the Client’s Merchandise or sales transactions. The Client shall monitor compliance under such laws, regulations, and requirements, and shall promptly notify BlueDrone of any special compliance issues raised by the offer or sale of the Client’s Merchandise or sales or promotional activities in a particular state.

11. Indemnification

A. The Client shall indemnify and hold harmless BlueDrone, its shareholders, officers, directors, and employees from and against all claims, damages, losses and expenses, including reasonable legal fees and costs of suit, arising out of or relating to any defects in the Merchandise or from the Client’s negligence or culpable acts or omissions.

12. Insurance

A. The Client shall provide, at its own expense, all necessary insurance for product damage loss through fire or other casualty while the merchandise is in the custody of BlueDrone, or in transit to or from any location

13. Confidentiality

A. Material or information which the Client gives or divulges to BlueDrone or which comes into the possession or knowledge of BlueDrone and which relates to the Client and its business operations, such as financial information, marketing data, customer lists, and pricing policies is confidential and proprietary. BlueDrone shall hold this information or material in confidence and shall not reveal the information or material without the consent of the Client. On termination of this Agreement, BlueDrone shall immediately deliver this information or material to the Client on request, if all invoices and outstanding debts to BlueDrone have been paid. BlueDrone may disclose certain information to affiliates (e.g., package placement opportunities, shopping cart developers, web security firms) if such firms may be deemed to be able to provide a valuable service on Client’s behalf.

14. Programming Ownership

A. BlueDrone is the exclusive owner of all internally¬ designed or developed computer programming utilized for processing, tracking, fulfilling, analyzing, or reporting orders for the Client’s merchandise. The Client shall not, directly or indirectly, divulge, disclose, or communicate to any other person or company who is not a party to this Agreement information concerning programming or systems designed or utilized by BlueDrone.

15. Audit and Inventory

A. Upon reasonable advance written notice and during normal business hours, the Client or the Client’s authorized representatives may inspect, audit, and copy excerpts from books, records, contracts, and data processing procedures created or maintained by BlueDrone that relate to the reconciliation of invoices to the Client and to this Agreement. This audit or inspection shall take place at the offices of BlueDrone or such other place as the parties mutually agree. The Client shall pay all direct and indirect costs of any such inspection or audit, except the salaries of BlueDrone employees and those costs reasonably incurred by BlueDrone in cooperating with such inspection or audit

B. On reasonable advance notice from the Client, BlueDrone shall perform a physical inventory of the Client’s merchandise held at BlueDrone’s facilities at reasonable times during normal business hours. The Client shall compensate BlueDrone as prescribed in the Service Fees section of this Agreement for all costs incurred in conducting the physical inventory.

C. BlueDrone will take reasonable and prudent precautions to preserve and protect Client’s property, including all property that is returned by buyers. If Client requires special handling or protection of its Merchandise, Client agrees to compensate BlueDrone for any extra costs incurred

D. Provided that BlueDrone takes reasonable precautions, BlueDrone shall not be responsible or liable for, and Client agrees to hold BlueDrone harmless from property losses or shrinkage under the acceptable rate of 2.5% of the greater of inventory value or annual shipments.

16. Client Payments and Reserve

A. At all times during the term of this Agreement, the Client shall provide BlueDrone with sufficient funds to cover all services rendered under this contract and all delivery service shipping costs. It is the Client’s responsibility to monitor and maintain such reserve. Should such reserve be fully utilized, BlueDrone reserves the right to stop services until Client provides sufficient reserve. Any amounts due to BlueDrone are subject to interest accruing at a rate of 1.5% per month.

B. Any excess reserve upon termination of this Agreement will be promptly returned to Client unless other clauses of this agreement would conflict.

9.3 Relationship. Each party is an independent contractor in the performance of each and every part of this Agreement. Each party will be solely responsible for all of its employees and agents and its labor costs and expenses arising in connection therewith and for any and all claims, liabilities or damages or debts of any type whatsoever that may arise on account of its activities, or those of its employees or agents, in the performance of this Agreement. Customer does not have the authority to commit BlueDrone in any way and will not attempt to do so or imply that it has the right to do so.

17. Return of Merchandise to the Company

A. BlueDrone shall, within thirty (30) days after termination of this Agreement, deliver all the remaining Merchandise entrusted to it by the Company to a location specified by the Client. The Client shall also have the option to arrange for the delivery of the Merchandise themselves. BlueDrone reserves the right to hold inventory for clients with outstanding bills indefinitely.

B. BlueDrone assumes no responsibility for any perishable or date-sensitive merchandise remaining in its facility after the termination of this Agreement. Absent other instructions from the Client, BlueDrone may, within thirty (30) days after the Client ceases to market any merchandise covered by this Agreement, charge up to twice the normal storage fees until the products are dispersed to their destination by the Client.

C. BlueDrone shall charge the Client the hourly rates prescribed in the Service Fees section of this Agreement to cover the direct cost of labor and administrative and systems support services for the relocation of merchandise or the return of merchandise to the Client.

18. Default, Termination, and Renewal

A. Either BlueDrone or the Client may terminate this Agreement or suspend its services under this Agreement, or both, under any of the following conditions:

B. Client fails to pay any sum due to BlueDrone within five (5) business days after receiving written notice that payment is past due.

C. Either party breaches any other obligations under this Agreement, and fails to remedy such breach within thirty (30) days after receiving a written notice from the other party specifying the nature of the breach.

D. Either party files a petition in bankruptcy, is declared bankrupt or insolvent, makes any assignment for the benefit of creditors, or is placed in trustee or receivership.

E. This Agreement shall be renewed automatically at the end of each term at the rates then prevailing for BlueDrone’s services, unless either party gives written notice to the other of its intent not to renew at least thirty (30) days prior to the end of each term.

F. If Client owes money to BlueDrone upon default or termination, Client must pay all charges due BlueDrone, including interest, before BlueDrone will release product to Client. Should Client not pay these charges within 7 days of default or termination, BlueDrone has the right to liquidate Client’s products in any manner that BlueDrone chooses. Proceeds will be used to pay BlueDrone’s balance due.

19. Force Majeure

A. Either party’s failure to perform any of its obligations under this Agreement, except its payment obligations, is excused due to any cause or event beyond the parties reasonable control including, without limitation, strikes, lockouts or other labor disputes, acts of God, fire, other casualty, civil insurrections, actions, or orders of any governmental or other lawful authority or similar events.

20. Assignment

A. Client may not assign its interests in this Agreement without the prior written consent of BlueDrone.

B. Such consent shall not be unreasonably withheld.

21. Waivers

A. If one party waives any term or provision of this Agreement at any time, that waiver will only be effective for the specific instance and specific purpose for which the waiver was given. If either party fails to exercise or delays exercising any of its rights or remedies under this Agreement, at party retains the right to enforce that term or provision at a later time.

22. Arbitration

A. Any dispute or claim arising out of or relating to this Agreement, or the performance of any obligations created or imposed by this Agreement, shall be resolved by arbitration before the American Arbitration Association, through its office in Minneapolis, Minnesota. A single arbitrator shall be selected, and all proceedings shall be conducted according to the American Arbitration Association’s Commercial Arbitration Rules. The arbitrator’s decision and award shall be final and binding, and it shall have the force and effect of a judgment when filed with any court of competent jurisdiction.

B. The cost of the arbitration procedure shall be borne by the losing party or, if the decision is not clearly in favor of one party or the other, then the costs shall be borne as determined by such arbitration procedure.

C. The arbitration procedure provided herein shall be the sole and exclusive remedy to resolve any controversy or dispute between the parties to this Agreement, and the proper venue for such arbitration proceeding and any legal action to enforce such arbitration award shall be Hennepin County, Minnesota. The parties to this Agreement hereby expressly consent to the jurisdiction and venue of Hennepin County District Court.

23. Attorneys’ fees

A. If any arbitration proceeding or action shall be brought to recover any amount due under this Agreement, or for or on account of any breach of or to enforce or interpret any of the terms, covenants, or conditions of this Agreement, the prevailing party shall be entitled to recover from the other party, as part of prevailing party’s costs, a reasonable attorneys’ fee, the amount of which shall be fixed by the arbitrators or by the Court and shall be made a part of any judgment or award rendered.

24. Notice

A. All notices under this Agreement shall be in writing, shall be effective when received, and shall be given by personal service, by facsimile transmission with suitable proof of receipt, or by certified or registered mail, return receipt requested, to the addresses set forth below or at such other addresses which may be specified in writing to all parties hereto.

Attn: Administration
225 Thomas Ave. N.
Minneapolis, MN 55405

25. Number and Gender

A. Whenever the context of this Agreement requires, the singular shall include the plural, the masculine shall include the feminine, and personal pronouns shall include corporations, firms, partnerships, or other forms of association.

26. Captions

A. Titles or captions contained in this Agreement are inserted only as a matter of convenience and for reference, and in no way define, limit, extend, or describe the scope of this Agreement or the intent of any of its provisions.

27. Governing Law and Successors

A. This Agreement, and any dispute, claim, or defense arising out of or relating to this Agreement, shall be governed and construed in accordance with the laws of the State of Minnesota. This Agreement shall be binding upon and inure to the benefit of the parties, their heirs, legal representatives, successors and assigns.

28. Entire Agreement

A. This instrument contains the entire agreement of the parties, and no representations, warranties, or inducements have been made by any of the parties hereto, except as expressly set forth herein.

28. Term of Agreement

A. The Term of this Agreement shall be indefinite through the duration of service, commencing on the Effective Date and shall be renewed automatically at the end of each term pursuant to Section 18E.