Marketplace by ProducePay Membership Agreement

1. Member Agreement. 

By electronically accepting this Membership Agreement (the “Agreement”), the entity or individual identified as a member in the Marketplace by ProducePay Membership Application (the “Member”) agrees that this Agreement shall be legally binding on the Member. A Member may participate in the Marketplace as a Seller that offers perishable fruits or vegetables (“Produce”) for sale in the Marketplace (a “Seller”), or as a Buyer who purchases Produce for sale in the Marketplace (a “Buyer”). The Marketplace is a network for Sellers and Buyers to sell, purchase and/or consign Produce through the utilization of the ProducePay platform. A Buyer can also participate in the Marketplace as a Seller, but any Member who seeks to act as a Seller must pay the annual membership fee described in Section 4 and meet all of the requirements placed on a Seller as set forth in this Agreement. The term “Buyer” is inclusive of a Member who acquires Produce from a Seller on a consignment basis for sale to third parties in exchange for a sales commission.

2. Membership Period. 

The membership period for the Marketplace Membership shall be one year from Member’s electronic acceptance of this Agreement. This Agreement shall renew automatically at the end of the initial membership period unless Produce Pay Inc. (“Company”) or Member provides notice that the agreement is terminated. The annual membership fee will be applied to the Member’s account for the next year of membership.

3. Membership Benefits.

The Marketplace Membership encompasses the following:

  • Assignment of a Company account representative
  • ProducePay Marketplace profile setup
  • Member search and performance vetting
  • 12 months access to Insights Pro and Daily Market Report
  • Advisory on market performance throughout the service period term
  • Accounting and reporting features on the Produce Pay platform.
  • Complementary dispute resolution service
  • Enrollment in the Company’s Supply Chain Services Program
  • Enrollment in the Company’s Quick-Pay Financing Program

4. Membership and fulfillment Fees. 

Member’s participation in the Marketplace is subject to it passing the Company’s diligence requirements, in the sole discretion of the Company. Any Member participating as a Seller in the Marketplace must pay the Company an annual membership fee (“Membership Fee”) as set forth in the “Marketplace Fee Summary”. The Company shall collect the Membership Fee for the first year of membership from the proceeds of the Member’s first Marketplace Transaction. If the Member does not pass the initial diligence requirements, the Member’s membership in the Marketplace and this Agreement shall automatically terminate and Company shall refund any membership fee that has been advanced by the Member. If a Member passes the initial diligence requirements but later fails to maintain those requirements, the Member shall not be entitled to a refund of any annual membership fee advanced to the Company. A Member participating only as a Buyer shall not be charged an annual Membership Fee.
As consideration for membership in the ProducePay Marketplace, a Member functioning as a Seller hereby agrees to pay the Company a Fulfillment Fee, as set forth in the “Marketplace Fee Summary”, that is assessed as a percentage of the final gross sales value of each shipment, net of documented adjustments allowed to the Buyer, sold to any Buyer on the Marketplace. A “Marketplace Buyer” is a grower matched with a Member by the Company.
Similarly, as consideration for membership in the ProducePay Marketplace, a Member functioning as a Buyer hereby agrees to pay the Company a Fulfillment Fee, as set forth in the “Marketplace Fee Summary”, that is assessed as a percentage of the final gross sales value of each shipment, net of documented price adjustments made in accordance with Section 8, sourced from any Seller in the Marketplace.

Marketplace Fee Summary

  • Seller Annual Membership Fee
  • Seller Fulfillment Fee per shipment
  • Buyer Fulfillment Fee per shipment

5. Information furnished by Member.

The member is required to furnish the Company with information or material about its entity, business, or products/services as part of the registration process for the Marketplace and to establish a Member account.  Member represents, warrants, and agrees that (a) such information and material whether submitted during the registration process or thereafter throughout the continuation of its use of the ProducePay platform is true, accurate, current, and complete, and (b) it will maintain and promptly amend all information and material to keep it true, accurate, current and complete.

6. Transaction Term Sheets.

 Each Member agrees that for each sale of Produce conducted with a Member of the Marketplace, the Seller and the Buyer shall jointly execute and submit a transaction term sheet in the form currently provided by the Company that includes, among other things, the type of Produce, estimated volume, estimated start terms, nature of the transaction, pricing, commission, and other material terms. Member shall immediately notify the Company in writing if there are any changes in any transaction from the terms previously provided to the Company in the transaction term sheet, and Member shall provide a signed writing to the Company executed by all parties to the amended term sheet.

7. Produce Inspection.

The Company shall have the right at any time and at its own discretion to inspect the shipped Produce that is offered for sale on the Marketplace upon its arrival into the possession of the Buyer, at the location where the Buyer possesses the Produce or at a subsequent destination of the Produce. The Company shall pay for the cost of such inspection, provided that if the inspection determines that less than 95% of the produce in any one truckload is not according to the grade agreed to in the term sheet, the Seller hereby agrees that it shall pay for such inspection. If the permissible percentage for acceptable grade for the commodity at issue is less than 95% under the applicable standards set forth in the Fruits and Vegetables Import Requirements (“FAVIR”) applied by the USDA’s Animal and Plant Health Inspections Services (“APHIS”), then the FAVIR standard shall apply for determining whether Seller must pay for the inspection. The inspection described herein is at the sole discretion of Company and utilized solely for the purposes of the Company’s administration of the Marketplace, and is a not a replacement for any inspection or regulatory obligation required by any other government agency.

8. Produce Acceptance.

A Member acting as a Buyer hereby agrees that, within one (1) business day of receiving a shipment of produce from a Marketplace Seller, it shall indicate its acceptance and the quantity and quality of the produce on the ProducePay platform.

The Buyer agrees that it shall only make quality deductions from a shipment from a Marketplace Seller in accordance with the following rules:

  1. The Buyer must provide a timely USDA inspection (within 8 hours of receipt for truck shipments and 24 hours of receipt for rail shipments as set forth under the Perishable Agricultural Commodities Act (“PACA”)) to justify all rejections, dumps, repacks, or sales below relevant or applicable market prices unless previously agreed upon with the Seller in a fully-executed writing provided to Company.
  2. Quality deductions are only permitted if justified by a third party audit where the auditor is trained to grade to USDA standards, unless Buyer and Seller waive this requirement in a fully-executed writing provided to Company.
  3. If the Buyer accepts anything less than shipped volume or adjusts prices below market rates, it must provide written reasoning as to why on the ProducePay platform or in writing to the Company.

9. Liquidations:

When a Buyer acts as a consignment agent (hereafter a “Consignee Member”), the Consignee Member agrees that, for each sale of Produce sourced from a Marketplace Seller, upon such sale Consignee Member shall pay to the Company an amount equal to: (a) all payments due from Consignee Member to the Marketplace Seller for that shipment (the “Liquidation Payment”), plus (b) the fulfillment fee owed by Buyer to be calculated in accordance with Section 6 (“Fulfillment Fee”).  When a Seller sells Produce to a Buyer rather than consigning the Produce, the Buyer shall pay to the Company an amount equal to: (a) the amount invoiced for the Produce which shall constitute the “Liquidation Payment” for non-consignment sales, plus (b) the Fulfillment Fee.  The Company will pay the Marketplace Seller the applicable Liquidation Payment less all amounts owed by the Marketplace Seller to the Company. Payment and accounting remittance (liquidation files) will be due to the Company as per PACA’s regulations within thirty (30) days of receipt from the date the goods are received and accepted by the ultimate receiver of the Produce from the Consignee Member for consignment sales.

For each shipment, the Consignee Member shall provide the Company with an itemized liquidation report showing itemized sales prices and all commission fees and other deductions, which shall be provided via the Company’s liquidation email address, uploaded into the ProducePay platform via CSV or PDF files, or sent via ERP integration. This report shall be provided at the same time as the Consignee Member remits the Liquidation Payment on the ProducePay platform.

10. Restrictions on Advances from Buyer.

A Buyer agrees that in any transaction with a Marketplace Seller, including but not limited to when a Buyer acts as a Consignee Member, Buyer will not offer to or provide a Marketplace Seller with any loans or advances (including preseason and/or pick & pack advances) without the prior written approval of the Company. The Company shall have the primary right to provide Pick and Pack funding for each Marketplace Seller shipment to the Buyer or Marketplace Seller for a separate fee, and/or provide a Marketplace Seller with pre-season funding for a separate fee.

11. Site Inspections.

A Member shall permit the Company to visit and inspect its ranches, properties and other facilities involved in the growing, harvesting, packaging, receiving or storing of Produce, whether such ranches, properties and other facilities are owned or controlled by the Member or the Member’s third party vendors, as long as the membership is active, and at any time and at the sole discretion of Company. A Member shall provide written instruction to any third party which owns or controls the facilities and properties referenced herein to provide access to Company for inspection.

12. Resolution of Trade Disputes through Mandatory Mediation.

When any dispute arises between a Buyer and a Seller involving a transaction of Produce on the Marketplace, the following provisions apply:

  1. Submission to Company as Mediator: In a disputed transaction between a Seller and a Buyer (including but not limited to transactions involving a Consignee Member), the dispute must first be submitted to Company for the purposes of mediation.  No Member may bring a legal action for breach of a Produce transaction involving the Marketplace without fully-participating in mediation, and Company shall act as the Mediator.  A Member shall initiate mediation by contacting Company in writing via email at, wherein the Member shall describe the substance of the dispute and the other Member(s) involved.  Each Member expressly consents to Company’s role as Mediator.  Company shall designate a member of its in-house legal department to act as the presiding mediator.  The presiding mediator will contact each Member who is a party to the dispute, and set forth an expedited calendar for resolving the dispute.  The presiding mediator may request briefing, documentary support, and may hold at least one online hearing to hear arguments and negotiate a resolution of the dispute.  In resolving the terms of any deal, the presiding mediator may only consider communications and agreements between Buyer and Seller that were contemporaneously provided and/or exchanged through the Company’s platform.  All communications provided in conjunction with the mediation shall be treated as confidential settlement communications.  All disputes shall be resolved by the presiding mediator within thirty (30) days of submission of the dispute to Company, provided that there is no substantial delay in locating and notifying each and every party to the dispute.   Company may, in its sole discretion, choose to waive its role to act as Mediator, at which time each Member shall have the right to file a legal action to resolve the claim.
  2. Decision of Company: If the parties privately resolve their dispute after submission to Company for mediation, they shall mutually contact Company to advise that the matter is concluded and Company shall issue no opinion or take any further action. If the parties do not reach their own amicable resolution, the Company shall issue a written decision concerning Company’s view of the merits of the dispute (the “Decision”). The Decision is not binding and shall not prevent a Member from bringing litigation concerning the dispute after issuance of the Decision. However, the Company may, in its sole discretion, suspend or terminate a Member’s membership in the Marketplace if Company determines that a Member breached its obligations to another Member in conjunction with a transaction on the Marketplace. Company may condition further participation in the Marketplace to a Member’s compliance with the Decision, including any payments that the Company determines in the Decision are owed to another Member. Company may publish within the Marketplace that a Member has had one or more unresolved claims against it if a Member does not comply with a Decision.
  3. Limited Release of Member Claims Against Company:  Member agrees that it has voluntarily contracted to designate Company as Mediator, that participation in the Mediation is mandatory but that the Decision is not legally binding, and that Member hereby releases Company and Company’s officers, directors, principals and of any claims relating to Company’s provision of services as Mediator. 

13. Enrollment in Supply Chain Services Program.

Member shall have the option of purchasing supply chain services (including freight, warehousing, importing, and related services) from Company in conjunction with any sale of Produce, pursuant to the Company’s Supply Chain Services Program.    By becoming a Member, the Member hereby agrees that Member is automatically enrolled in the Supply Chain Services Program, and as a term of this Membership, agrees that any service ordered pursuant to the Supply Chain Services Program shall incorporate and be subject to the Terms and Conditions for ProducePay Supply Chain Services located at [See Annex B].  By becoming a Member, Member hereby (a) acknowledges that it has received and reviewed the Terms and Conditions for ProducePay Supply Chain Services, and (b) agrees to be bound by the provisions set forth in the Terms and Conditions for ProducePay Supply Chain Services in conjunction with any supply services Member orders from Company.

14. Enrollment in Quick-Pay Financing Program.

Member shall have the opportunity to sell Produce invoices to Company pursuant to the Quick-Pay Financing Program. By becoming a Member, the Member hereby agrees that Member is automatically enrolled in the Quick-Pay Financing Program. Any invoice sale pursuant to the Quick-Pay Financing Program shall incorporate and be subject to the Marketplace by ProducePay Factoring Contract located at [See Annex A]. By becoming a Member, Member hereby (a) acknowledges that it has received and reviewed the Marketplace by ProducePay Factoring Contract and the Marketplace by ProducePay Quick-Pay Financing Guidelines referenced therein, and (b) agrees to be bound by the provisions set forth in the Marketplace by ProducePay Factoring Contract and the Marketplace by ProducePay Quick-Pay Guidelines in conjunction with any Produce invoices Member sells to Company pursuant to the Quick-Pay Financing Program.

15. Data.

Member hereby grants the Company a non-exclusive, worldwide, perpetual, transferable, royalty-free license to use, copy, transmit, sub-license, index, store, aggregate, and display Transaction Data in connection with the operation and maintenance of the Marketplace, for technical support of the ProducePay platform, to perform the payment liquidations, to otherwise perform obligations to the Member, to monitor Member’s suitability for continued inclusion in the Marketplace, to perform account management services, and to publish, display, and distribute de-identified, aggregated information derived from Transaction Data and other information from Member’s use of the ProducePay platform and participation in the Marketplace, for marketing, research or compliance purposes, for purposes of improving the Company’s products and services or the ProducePay platform, and for developing, displaying, and distributing benchmarks and similar reports, provided that any such data is not publicly identified or identifiable as originating with or associated with Member. The foregoing shall not limit the ability of the Company: (a) to publish or otherwise share or distribute information regarding the Member that is obtained from publicly available or nonconfidential sources, such as Blue Book, or (b) to share data with another Member regarding transactions with that particular Member. “Transaction Data” means any data of any type regarding transactions between Seller and a Buyer (including a Consignee Member), including without limitation Produce type, pricing and quality, sale price, fees and deductions, quality, grading and time periods for sale or liquidation of Produce.

16. Privacy Policy and Terms of Use.

Member hereby consents to the Company’s privacy policy, located at which describes Company’s privacy practices, and the Company’s terms of use located at, both of which are incorporated by reference into this Agreement. By Member’s continuing use of the ProducePay platform, Member consents to any updates to the Company’s privacy policy or terms of use that may be published on the Company’s website or the ProducePay platform from time to time.

17. Right to Terminate Membership.

Member may terminate its membership in the Marketplace at any time upon written notice to the Company. The Company may terminate Member’s participation in the Marketplace upon written notice to Member if (a) the Company, in its sole discretion, determines that Member no longer satisfies the Company’s diligence standards or that it is not in the best interests of the Company or the Marketplace for Member’s participation to continue, or (b) the Company discontinues or modifies the participation requirements for the Marketplace and Member no longer meets and/or agrees to the modified participation requirements.

18. Survival. 

The fulfillment fee under Section 4 and the requirements regarding transaction term sheets, product inspection and acceptance, and liquidations under Sections 6, 7, 8 and 9 apply to all shipments sourced from a Marketplace Seller even after Member’s membership in the Marketplace expires or terminates, regardless of the reason (including for non-renewal or termination under Section 16). The Member shall continue to owe fulfillment fees to Company for any transaction with another Member or former Member, regardless of whether a Member has terminated its membership in the Marketplace, and regardless of whether both parties to the transaction have terminated their memberships in the Marketplace. In addition to Sections 4 and 6-9 surviving, the restriction on advances under Section 10, the obligation to mediate under Section 12, and the provisions of Sections 5, 11, and 20-27 and this Section 18 shall survive the expiration or termination of this Agreement and the Member’s participation in the Marketplace, regardless of the reason.

19. Assignment. 

This Agreement shall not be assigned or delegated by the Member in whole or in part without the prior written consent of Company, which may be withheld by Company in its sole discretion.

20. Waiver; Severability. 

Failure by the Company to enforce a provision of this Agreement shall not constitute a waiver of that or any other provision of the Agreement. If one or more provisions of this Agreement are held to be unenforceable under applicable statute, regulation or other law, Company and the Member shall renegotiate such provision in good faith, in order to maintain the economic position enjoyed by each party as close as possible to that under the provision rendered unenforceable. If Company and the Member cannot reach a mutually agreeable and enforceable replacement for such provision, then (a) such provision shall be excluded from this Agreement, (b) the balance of this Agreement shall be interpreted as if such provision were so excluded, and (c) the balance of the Agreement shall be enforceable in accordance with its terms.

21. Governing Law; Consent to Jurisdiction. 

This Agreement and all documents, agreements, contracts and instruments executed in connection herewith shall be governed by and construed and enforced in accordance with the laws of the State of Delaware, without regard to its conflict of laws provisions that would require the application of the laws of another jurisdiction. Member hereby irrevocably submits to the non-exclusive jurisdiction of any United States federal court or California state court located in Los Angeles County, California, in any action or proceeding in which Company is a named party arising out of or relating to this Agreement or any documents executed in connection herewith and Member hereby irrevocably agrees that all claims in respect of such action or proceeding may be heard and determined in any such United States Federal Court or California state court. Member irrevocably consents to the service of any and all process in any such action or proceeding brought in any court in or of the State of California by the delivery of copies of such process to it at its address set forth in this Agreement by certified mail directed to such address or such other address as may be designated by Member in a notice to the Company.

22. Entire Agreement.

This Agreement, together with the other agreements referenced herein or in the Marketplace by ProducePay Membership Application, sets forth the sole understanding and agreement of the Member and the Company with respect to the Member’s participation in the Marketplace and supersedes all other prior and contemporaneous discussions, negotiations agreements and understandings, whether written or oral, between them.

23. Amendments.

No modification of this Agreement or of any covenant, condition or limitation contained herein shall be valid or effective unless it is (a) in writing and duly executed by the parties hereto, or (b) electronically accepted by Member on the ProducePay platform. Member’s continued use of the ProducePay platform after notification of modifications of this Agreement by Company via the ProducePay platform will be deemed electronic acceptance by Member hereunder.

24. Attorneys’ Fees. 

In any action between Member and Company arising out of or relating to this Agreement, the non-prevailing party will pay the substantially prevailing party’s reasonable attorneys’ fees, costs, and necessary disbursements, whether or not the action is prosecuted to award or judgment.

25. Relocation or Name Change. 

The Member shall provide Company with written notice at least thirty (30) calendar days prior to the Member’s change of name or location.

26. Company Disclaimer. 

The Member acknowledges and agrees that the Company is providing no representations, warranties, guaranties or assurances of any type to the Member regarding any other Member, the performance by a Member of its obligations to another Member, or the Produce provided by a Seller to a Buyer.

27. Controlling Translation. 

While a translation of this Agreement may be provided for the convenience of Member, the English version shall govern in the event of any conflicts with any other translation of this Agreement.



Company Name:





Annex A



This Factoring Contract (the “Factoring Contract”) is made and entered into by and between Produce Pay Inc., a Delaware corporation (hereinafter “Company” or “Buyer”), and the seller (“Seller”) agreeing to this Factoring Contract through its concurrent execution of the Marketplace By ProducePay Membership Agreement (hereinafter “Membership Agreement”), (Company and Seller hereinafter collectively the “Parties”).  By executing the Membership Agreement, Seller is electronically accepting this Factoring Contract, and the Seller agrees that this Factoring Contract shall be legally binding on the Seller.  




The Seller agrees that the purchase price for any invoice sold to Company shall be set forth in a Bill of Sale.  The Seller shall provide its contact information for Notices pursuant to this Factoring Contract when it executes the Factoring Contract electronically.  The Payment Terms for invoice purchases shall be within 24 hours after Company receives proper verification of the receivable and/or invoice being acquired.  Company shall make final determinations in its sole discretion of whether to acquire any invoice, and will only consider receivables which are under 30 days pursuant to standard accounts receivables aging reporting practices.  




WHEREAS, Seller operates in the produce industry and is engaged in the business of growing, buying and selling perishable agricultural commodities (“Produce”) in domestic or foreign commerce for sale in the United States marke t, and the Produce is regulated under the Perishable Agricultural Commodities Act, 1930, as amended, 7 U.S.C. §§ 499a (“PACA”), regardless of whether the Seller holds a USDA-issued PACA license;


WHEREAS, Seller desires and intends to sell certain of its Produce-related Accounts and Receivables in order to mitigate the impact of slow payment practices, eliminate the risk of nonpayment and otherwise improve its cash flow by converting certain of its Produce-related Accounts and Receivables to cash, thereby making said assets more freely available;


WHEREAS, Seller is a member of the Marketplace By ProducePay (the “Marketplace”) and sells or intends to sell Produce to other members of the Marketplace in the United States market;


WHEREAS, Seller desires and intends to sell, assign, convey, and transfer to Company all or the entirety of its beneficial interests in and to certain of its Produce-related Accounts and Receivables for sales generated on the Marketplace, along with any and all of its PACA Trust Rights appurtenant thereto, including without limitation its Rights to receive prompt payment and to enforce its beneficial interests in and to the U.S. Account Debtor’s PACA Trust Assets;


WHEREAS, Company is engaged in the business of purchasing Produce receivables and other contract based rights to receive payments at a discount for the benefit of its private investors;


WHEREAS, Company has developed and maintains an innovative, on-line software platform (the “Platform”) that allows Produce Pay to work directly with growers, sellers, and buyers of Produce at shipping point, providing record keeping, marketing, accounting, and other services appurtenant to its Produce dealings. The Platform and the contracts that Produce Pay establishes with its customers and trading partners are carefully designed to facilitate and incentivize trading in Produce in a manner that is more efficient, stable and profitable for participants in the nationwide Produce distribution chain.  Company has also made the Platform available to provide and facilitate alternative financing options (i.e., non-lending based) for distributors and producers of Produce, including the factoring of invoices as described herein;


WHEREAS, the Seller and Company wish to enter into an agreement that memorializes the Seller’s use of the Platform and Company’s provision of the Platform and any associated services; and


WHEREAS, Seller and Company desire that this Factoring Contract shall incorporate all of the terms of the “Guidelines for Marketplace by ProducePay Produce Invoice Purchases” (the “Guidelines”) found at


THEREFORE, Seller hereby agrees to sell certain of its accounts and receivables, and Company agrees to purchase the same, subject to the terms and conditions set forth in this Factoring Contract and as set forth in a Bill of Sale accompanying each invoice purchased by Company, which shall become a schedule to this Factoring Contract. The term of this Factoring Contract shall commence on the Effective Date of the Membership Agreement and shall stay in effect as long as the Membership Agreement is in effect   (the “Contract Period”).




  • The information contained in the “Key Terms & Information” and the “Recitals” sections above are hereby incorporated into this Factoring Contract as though fully set forth in this section one and shall constitute material terms of this Factoring Contract.
  • The terms and provisions of the Guidelines and all forms therein are hereby incorporated and made a part hereof and are an integral part of this Factoring Contract.  In the event of any conflict, inconsistency or discrepancy between any of the provisions of the Guidelines and any of the provisions of this Factoring Contract, the provisions of this Factoring Contract shall control and be binding upon Company and the Seller.  The Seller hereby (a) acknowledges that it has received and reviewed the Guidelines; and (b) agrees to be bound by the terms and conditions set forth in the Guidelines.
  • Seller and Company agree to execute and deliver to the other such reasonable and additional documents, instruments or agreements as may be necessary or appropriate to effectuate the purposes of the Guidelines, including but not limited to all forms and notices identified in and/or attached to the Guidelines.
  • Seller designates Company as its agent for the purposes of serving any notice to a buyer of Produce for the purposes of preserving trust rights under PACA.
  • This Factoring Contract shall be construed in accordance with the laws of the State of Delaware, and the obligations, rights and remedies of the Parties hereunder shall be determined in accordance with the laws of the State of Delaware, except to the extent preempted by Federal law.  All disputes relating to or arising under this Factoring Contract shall be resolved in the federal or state courts located in the City of Los Angeles, California.
  • This Factoring Contract, and any exhibits or attachments to the Factoring Contract and/or the Guidelines that may be required to be executed under the terms of the Factoring Contract, may be executed simultaneously in any number of counterparts in any instance where a Company signature is necessary, and/or executed electronically.  Each counterpart shall be deemed an original, and all such counterparts shall constitute one and the same instrument.

Annex B


  1. Applicability. These Terms and Conditions (“Terms”) shall apply to any order for supply chain  services (“SCS”) mutually agreed to in writing by a member (“Member”) of the Marketplace By ProducePay (the “Marketplace”), and Produce Pay Inc. (“Company”) (Member and Company are each a “Party” and referred to  collectively as “Parties”), where a Member has entered into a written Supply Chain Service Term Sheet (“Term  Sheet”) for Company to provide one or more SCS to Customer relating to the movement or storage of perishable  agricultural commodities (“Produce”) in domestic and/or foreign commerce into the United States market and the Produce is regulated under the Perishable Agricultural Commodities Act, 7 U.S.C. §§499a, et seq. (“PACA”) regardless of whether the Customer holds a USDA-issued PACA license.  “SCS” shall include freight services, customs/brokerage services, warehousing services, and any other service that the parties expressly define in writing to be a “supply chain service.”  


  1. Warranties and Limitations. Customer, to induce Company to provide the SCS agreed to in the Term sheet and with full knowledge that the truth and accuracy of the foregoing are being relied upon by Company in determining whether to provide the SCS, hereby warrants, covenants, agrees, and unconditionally guarantees that:  
  • Customer has the full and complete legal right, title, and authority to order and authorize the SCS relating to the Produce, and is responsible for payment to Company for any SCS ordered by Customer and/or provided by Company. Customer shall be responsible for paying for any such SCS even in the event that it is determined in a judicial or governmental proceeding that Customer lacks the legal authority over the Produce warranted herein.  
  • Customer has and will comply with all laws and regulations (state, federal or international) having application to the goods sold, including Produce, and/or having application to the services provided to Customer by Company.  
  • Customer understands that for the purposes of brokerage/customs services, Company acts as agent for Customer only for customs services a set forth in the Rules of the U.S Treasury Department, U.S. Customers Services. In all other aspects, Company and Customer act as independent contractors, including for all other SCS requested by Customer, subject to the provisions of 19 C.F.R. Part 111.44.  
  • If Customer is acting as an importer of record, payment to Company will not relieve Customer of liability for customs charges (duties, taxes, or other debts owed to customs), in the event charges are not paid by Company.  
  • Importers must furnish all required documents within the required time period to avoid customs penalties. Customer will be responsible for all penalties as described herein.  
  • All claims for cargo loss, damage and salvage shall be submitted to Company and handled and processed in accordance with 49 C.F.R. §370.  
  • Pricing set forth in a Term Sheet is subject to change based upon the actual services provided in the event additional services become necessary, and the invoice will reflect any additional services charged utilizing industry pricing for such services.  


  1. Notices. All notices to be given under these Terms or under a Term Sheet shall be considered delivered when served on the other party via facsimile transmission, e-mail or Certified United States mail, postage prepaid, addressed as set forth in the Term Sheet for the Customer, and to Company as follows:  

Company:           PRODUCE PAY, INC.  

555 West 5th Street, 35th floor

Los Angeles, CA 90013  


  1. Miscellaneous.

(a) Amendments. No amendments, modifications, or additions to a Term Sheet shall be binding unless in writing  and signed by both parties, except that Company may amend these Terms unilaterally from time-to-time. Company  shall provide notice to Customer of amendments to the Terms, and the amendments shall apply to any SCS requested  by Customer that takes place after notice has been provided to Customer.  

(b) Applicable Law. This Contract shall be governed in all respects, whether as to validity, construction, capacity, performance or otherwise, by the laws of the State of Delaware not including the body of law known as conflict laws. In any dispute relating to this Agreement, the Parties hereto admit venue and submit themselves to the nonexclusive jurisdiction of the state or federal courts located in Los Angeles, California. The Parties each agree to  waive any and all objections to that Court’s exercise of both subject matter and personal jurisdiction over each of them  to fully determine any such controversies or claims. Both Parties further agree the prevailing party shall be entitled  to reasonable attorneys’ fees and all costs of collection or enforcement. To any extent that the United Nations  Convention on the International Sale of Goods applies to the transactions contemplated under this Agreement, the  parties hereby agree that the provisions of the United Nations Convention on the International Sale of Goods shall not  apply to this Agreement.  

(c) Covid-19 as Force Majeure Statement. The Parties understand and agree that the Covid-19 pandemic, along  with various civil orders requiring masks, limiting the size of public or private gatherings, imposing curfews,  restricting dine-in eating establishments, etc., has been known to the Parties since the first quarter of 2020 and the  impacts of the same, including, but not limited to, market decline, have been fully evaluated by the Parties in  connection with their election to execute and otherwise enter into this Agreement.  

(d) Force Majeure: Neither Party shall be responsible for the non-performance of any part of this Agreement caused by act of God, lawful government order, fire, strikes, riots, earthquake, hurricane, war, explosion, rebellion, insurrection, labor disputes, accidents to machinery, or other emergency reasonably beyond the control of the affected party.  

(e) Indemnity. Customer hereby agrees to fully indemnify Company, fully provide for the cost of any defense of Company’s choosing, and to hold Company completely harmless from any and all liability to third parties (including any governmental agency) arising out of Customer’s performance or non-performance of any act or service relating to the Produce, the SCS, or the Term Sheet.  

(f) Assignment: Company may assign its rights hereunder, or any portion thereof, by delivering to the Customer a copy of the instrument of assignment. The assignment shall become effective upon Customer’s receipt of the instrument of assignment. Absent a written agreement with Company, Customer has no right to assign its rights hereunder.  

(g) These Terms and any Term Sheet shall be executed in English. In the event the Terms or a Term Sheet are translated to Spanish text or other language, the English text shall be controlling. In the event of a conflict between the provisions of the Spanish text or other translated language and the English text, the provisions of the English text shall be controlling.  

(h) Binding Effect. These Terms and any Term Sheet shall be binding upon and shall inure to the benefit of the Parties and their respective successors, assigns, heirs and general representatives.  

(a) Severability. In the event any provision or portion of these Terms is held to be invalid, void or unenforceable, the remainder of the Terms shall, nonetheless, remain in full force and effect and in no way shall be affected, impaired or invalidated.  

(b) Entire Agreement. These Terms shall be incorporated into any Term Sheet between the Parties, and together with any internally referenced or attached exhibits, shall constitute the entire agreement between the Parties relating to the SCS, and supersedes all prior understandings, previous negotiations, terms sheets, and any memoranda or understanding with respect to the SCS. To the extent there is any conflict between these Terms and the Marketplace by ProducePay Membership Agreement, the terms of these Terms shall prevail. Otherwise, all terms of the 


Membership Agreement shall be incorporated into these Terms.  

(c) No Strict Construction. The language used in a Term Sheet or these Terms shall be deemed to be the language  chosen by the Parties hereto to express their mutual intent, and no rule of strict construction will be applied by any  Person or court of competent jurisdiction and none of the terms contained herein shall be construed against any single  party hereto as the drafter of these Terms or Terms Sheet.  

  2. Intellectual Property.  

 (a) The Customer agrees that Company owns all right, title, and interests in the Platform and Company’s rights  to letters patents, Trademarks, other trademarks, registrations and approvals, inventions, copyrights, know-how, trade  secrets and other intangible property concerning Produce (collectively, “Intellectual Property”) and the Customer  shall acquire no rights in any Intellectual Property. The use by the Customer of any of Intellectual Property is  authorized only for the purposes herein set forth, and upon termination of this Agreement for any reason such  authorization shall cease.  

 (b) The Customer hereby irrevocably assigns to Company any right of title or interests that the Customer may  have or acquire in any modifications, designs or improvements of Company’s Intellectual Property by its employees  or agents.  

 (c) The Customer shall not dispute or contest or assist others to dispute or contest the validity of any of  Company’s Intellectual Property. In addition, if the Customer so disputes or contests or assists others to dispute or  contest the validity of any of Company’s Intellectual Property, Company shall have the right to terminate this  Agreement immediately upon written notice to the Customer.  

 (d) The Customer shall promptly and fully notify Company of any actual, threatened or suspected infringement  of any Intellectual Property of Company which comes to the Customer’s attention.  

  1. PROPRIETARY INFORMATION; Non-competition, Non-solicitation and Non-disparagement

 (a) Confidentiality. The Customer shall strictly maintain and shall cause its officers, directors, employees, and  agents to so maintain, the confidentiality of the terms of the Term Sheet and any trade secrets, know-how, producer  or distributor lists, financial information or other proprietary information of Company or its affiliates which is not a  matter of public knowledge, which, for the avoidance of doubt, shall include information regarding the operation of the Platform and any documentation thereof (collectively, the “Proprietary Information”) during the Term of a  Term Sheet and for two (2) years thereafter (such period, the “Restricted Period”). For purposes hereof, Proprietary  Information shall not include information disclosed by Company or its Affiliates to the Customer which the Customer  can establish (a) was known by the Customer or any of its divisions, subsidiaries or affiliates prior to the date thereof;  (b) was received by the Customer from a third party having the lawful right to disclose such information; or (c) is in  the public domain through no fault of the Customer or its officers, directors, employees, affiliates or agents. The  Customer shall not make or retain any copies of any Proprietary Information that may have been entrusted to it and  shall use Proprietary Information solely for purposes of exercising its rights and carrying out its obligations under  these Terms. Upon termination of a Term Sheet for any reason, the Customer shall immediately cease using any  Proprietary Information.  

 (b) Non-competition, Non-solicitation and Non-disparagement. The Customer shall not:  

(i) during the Restricted Period, directly or indirectly, own, operate, manage, control, participate in, be  employed by, consult with, advise or engage in services for any person or entity engaged in  Company’s business of providing an online software platform to facilitate alternative financing  options for producers and distributors of Produce;  

(ii) during the Restricted Period, directly or indirectly induce or attempt to induce any customer, client,  vendor, supplier or other business relation of or to the Company or any of its Affiliates, to cease  doing business with the Company or any of its Affiliates, to reduce or otherwise adversely change  its business with the Company or any of its Affiliates, or in any other way deliberately interfere  with the relationship between the Company or any of its Affiliates, on the one hand, and any such  customer, client, vendor, supplier or other business relation, on the other hand; or  

(iii) after the Effective Date, directly or indirectly, make any written or oral statement concerning the  Company that is harmful to the Company, its business or the business reputation of the Company.  

  1. The Parties further acknowledge and agree that, should a party so elect, the electronic signature of  a Party (whether digital or encrypted) to a Term Sheet shall be as valid as an original wet ink or manual signature of  such party and shall be effective to both authenticate and legally bind such party to a Term Sheet. The parties further  agree that any electronically signed document (including these Terms) shall be deemed (i) to be “written” or “in  writing,” (ii) to have been actually signed by the Party or Parties electing to utilize electronic signatures, and (iii) to  constitute a record established and maintained in the ordinary course of business and an original written record when  printed from electronic files.  
  2. By executing a Term Sheet, each Party expressly represents: (a) it has carefully read these Terms  and all documents to which the Terms make reference; (b) it understands all of its terms of each such document and  had the opportunity to consult with counsel of its own choosing, and; (c) it has executed a Term Sheet, with fully  authority and the intent to be bound hereto, as an act of its own free will.