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Supplier with notice prior to the initiation of any recall, recovery, replacement and/or retrofit procedures and shall use
commercially reasonable efforts to cooperate and consult with Supplier on any and all recall, recovery, replacement and/or
retrofit matters, including, without limitation, any technical or procedural matters which may arise.
Item 32 - Changing Specifications/Discontinuing Orders.
(a) Price Change. The Servicers (but not the Co-op or other Selected Buyers) may, upon written notice
to Supplier, change the Specifications for the Products. Supplier's price for the modified Products shall reflect only increases
or decreases in Supplier's actual labor, material, and tooling/equipment costs arising out of the change in specification. In
the event of a Specification change, Supplier shall promptly, on an expedited best efforts basis, furnish the itemization of its
proposed adjusted pricing to the Co-op for review and agreement.
(b) Inventory. In the event that the Specifications are changed, the Co-op and/or its Selected Buyers
may, at their sole discretion, acquire Supplier's current conforming inventory of the affected merchantable Products, in a
quantity not to exceed, in the absence of a minimum/maximum inventory mechanism, such aggregate supply of conforming
inventory of merchantable Products (including finished Products, work in process, and proprietary raw materials), determined
on an item-by-item basis, purchased by the Co-op and/or its Selected Buyers in an average thirty (30) day period over the
three (3) months immediately prior to the Specification change, and in the event a minimum/maximum inventory mechanism
is specified in applicable SSA Addenda, Supplier's entire conforming inventory of merchantable Products specifically
identified to this Agreement in an amount not to exceed the maximum inventory specified. Notwithstanding the foregoing, the
Co-op and/or its Selected Buyers may require Supplier to modify such inventory of Products to meet the new Specifications.
Supplier may adjust pricing only on such inventory which the Co-op and/or its Selected Buyers are obligated to purchase
pursuant to this Section 32 and then solely to reflect such changes in Supplier's costs necessitated by the change in
Specifications.
(c) Modification/Termination. In the event that the Specifications are changed or a Product is deleted
from the menu at any time during the Term, the Co-op may modify or terminate this Agreement with thirty (30) days prior
written notice to Supplier. In the event that the Specification change or other menu change requires an entirely new Product,
the Co-op will allow Supplier a reasonable opportunity to seek the applicable Servicer’s approval of Supplier as a supplier of
the newly defined Product(s); provided, however, any such approval of Supplier as a supplier of the newly defined Product(s)
shall be the sole discretion of the applicable Servicer.
Item 33 - Right of Setoff.
The Co-op may setoff any amounts which Supplier owes under this Agreement from any amounts otherwise due from the
Co-op to Supplier under this Agreement, and likewise the Supplier may setoff any amounts which the Co-op owes under this
Agreement from any amounts otherwise due from the Supplier to the Co-op under this Agreement. Any Selected Buyer may
setoff any amounts which Supplier owes such Selected Buyer under this Agreement from any amounts otherwise due to
Supplier from such Selected Buyer under this Agreement, and likewise the Supplier may setoff any amounts which such
Selected Buyer owes the Supplier under this Agreement from any amounts otherwise due to such Selected Buyer from
Supplier under this Agreement.
Item 34 - Right to Inspect Products.
The parties agree that the Co-op and/or the Servicers may, from time to time, inspect the Products during their manufacture,
processing and/or preparation during regular business hours at Supplier's place of business. The Co-op and/or the Servicers
may, in addition to the described inspections, make any further reasonable inspections they may desire, including without
limitation, inspection at the time of delivery and/or at the time of completion or manufacture of the Products. In addition, the
Servicers and the Co-op have the right to remove a reasonable amount of Products at any time or from any place for
inspection by the Servicers or its third party designee. Failure on the part of the Co-op, the Selected Buyers, the Servicers
and/or a third party designee to inspect the Products shall not be construed as an acceptance of the Products with
knowledge of the nonconformities that may have been discovered on a reasonable inspection. Nothing in this Section 34
shall relieve the Supplier in any way from its obligations of testing, inspection and quality assurance.
Item 35 - Inspection of Records.
Supplier agrees that the Co-op and/or the Servicers shall have the right upon reasonable notice to inspect and audit all
records maintained by Supplier in connection with this Agreement during the term hereof and for a period of three (3) years
thereafter. Such inspection and/or audit shall be conducted during normal business hours at Supplier's principal place of
business. Supplier agrees to provide copying capability and work space and agrees to cooperate fully in any such inspection.