Acknowledgment of Vendor Compliance Manual Revision 4

Garnet Hill Vendor Compliance Manual

Revision 1/1/2012 TABLE OF CONTENTS

OVERVIEW

WELCOME TO GARNET HILL Page 3

GARNET HILL CODE OF CONDUCT Page 4 - 5

PURCHASE ORDER TERMS AND CONDITIONS Pages 6 – 11

VENDOR COMPLIANCE MANUAL ACKNOWLEDGMENT Page 12

QUALITY REQUIREMENTS

QUALITY PLANNING Page 14

TOP OF PRODUCTION Page 15

TESTING AND PERFORMANCE STANDARDS Pages 16 - 18

CPSC AND CPSIA Pages 19 - 20

CALIFORNIA PROP 65 SETTLEMENT Page 21

WOOD PACKAGING MATERIAL Page 22

WOOD COMPOSITE REQUIREMENTS (CARB) Page 23

INDIVIDUAL ITEM PACKAGING REQUIREMENTS Pages 24 - 25

ITEM LABELS Page 26

FURNITURE PACKAGING PROTOCOL Pages 27 - 28

PACKAGE TESTING REQUIREMENTS: HARD GOODS Pages 29

CPSIA CERTIFICATE OF CONFORMITY Page 30 - 31

SHIPPING REQUIREMENTS

CHARGE BACKS FOR NON-COMPLIANCE Page 33

VENDOR SHIPMENT CHECKLIST Page 34

PACKING LIST Page 34

ROUTING GUIDE & TRANSPORTATION Page 34

BILL OF LADING Page 34

BILL TO ADDRESS Page 34

INVOICING REQUIREMENTS FOR INVENTORY VENDORS Page 35

EXTERNAL CASE LABELING (UCC-128 LABELS) Pages 36 2 - 37

GARNET HILL UCC-128 RECOMMENDED SOURCE Page 38

CASE SIZE REQUIREMENTS Page 39

UCC-128 CASE LABEL PLACEMENT Page 40 - 41

CASE SEALING AND PALLETIZING A SHIPMENT Page 42

RUG PACKING & LABELING Pages 43 – 44

ADVANCED SHIPMENT NOTIFICATION (ASN) Page 45

IMPORT REQUIREMENTS Pages 46 - 53

3 o r i g i n a l d e s i g n s i n c l o t h i n g a n d h o m e d é c o r

Dear New Garnet Hill Vendor,

Welcome to the Garnet Hill family! At Garnet Hill, much of our success derives from the strong relationship we have developed with our vendors over the years. Together, we and our suppliers provide customers with beautifully designed products of the highest quality and value, delivered with award winning customer service.

The Garnet Hill’s Vendor Manual is an outline of the company’s operating principles. It will provide you with an overview of the Garnet Hill business philosophy, detailing how we work together with vendors to develop, buy and ensure the quality of our products. Our objective is to work with you in a spirit of cooperation and partnership to help us achieve our mutual goals.

In order to develop a sound business partnership, it is critical that our vendors understand our business procedures and requirements.

 Quality Assurance Requirements  Shipping Procedures and Documentation Requirements

Important requirements are provided in the attached guidelines that will expedite shipping and avoid costly delays and mishandling issues. All information in the Vendor Operations Manual should be considered confidential and proprietary to Garnet Hill, Inc. We urge you to carefully read this manual in its entirety and share its contents with the appropriate individuals within your organization. You will be contacted shortly by our Vendor Relations Coordinator to ensure you are comfortable with this communication and also to welcome you to our family of suppliers. In the interim, should you have any questions, please don’t hesitate to contact the Vendor Relations Coordinator at (603)823-5545 or [email protected]. This person is here to help you.

We look forward to a mutually rewarding business relationship with you and your staff. This manual is intended to facilitate our relationship. We invite your questions or comments regarding our policies and procedures as you review the manual, or at anytime in the future.

Respectfully,

Russ Gaitskill President & CEO

4 GH Code of Conduct for Manufacturers

At GH, we are committed to:

 A high standard of excellence in every aspect of our business and in every corner of the world;  Ethical and responsible conduct in all of our business dealings and operations;  Respect for the rights of all individuals; and  Respect for the environment.

We expect the same commitments to be shared by all manufacturers of merchandise supplied to GH (“Manufacturers”). At a minimum, we require that all Manufacturers meet the following standards:

General Manufacturers must comply with all applicable laws and regulations, including, but not limited to, those related to employment/labor, worker health and safety, and the environment.

All references to “applicable laws and regulations” in this Code of Conduct include local and national codes, rules, and regulations as well as applicable treaties and voluntary industry standards.

Child Labor Manufacturers will not use child labor.

The term “child” refers to a person younger than 15 (or 14 where local law allows) or, if higher, the local legal minimum age for employment or the age for completing compulsory education.

Manufacturers employing young persons who do not fall within the definition of “children” will comply with any laws and regulations applicable to such persons.

Involuntary Labor Manufacturers will not use any forced or involuntary labor, whether prison, bonded, indentured, or otherwise.

Coercion and Harassment Manufacturers will treat each worker with dignity and respect and will not use or tolerate corporal punishment, threats of violence, or other forms of physical, sexual, psychological, or verbal harassment or abuse.

Nondiscrimination Manufacturers will not discriminate in hiring or employment practices, including salary, benefits, advancement, discipline, termination, or retirement on the basis of race, color, national origin/heritage, religion, age, nationality, social or ethnic origin, maternity, sexual orientation, gender, political opinion, or disability. Manufacturers will not retaliate against workers who complain in good faith about what they believe to be discrimination.

Association Manufacturers will respect the rights of workers to associate, organize, and bargain collectively in a lawful and peaceful manner, without penalty or interference.

Health and Safety Manufacturers will provide workers with a safe and healthy workplace in compliance with all applicable laws and regulations.

Manufacturers will also ensure that the same standards of health and safety are applied in any housing they provide for workers.

Compensation Wages are essential to meeting workers’ basic needs. Manufacturers will, at a minimum, comply with all applicable wage and hour laws and regulations, including those relating to minimum wages, overtime, maximum hours, piece rates, and other elements of compensation, and provide legally mandated benefits. Manufacturers must pay at least 5 minimum wages required by law or wages consistent with local industry standards, whichever is greater. If local laws do not provide for overtime pay, Manufacturers will pay at least regular wages for overtime work. Except in extraordinary business circumstances, Manufacturers will not require workers to work more than the lesser of (a) 48 hours per week and 12 hours per week overtime, or (b) the limits on regular and overtime allowed by local law; where local law does not limit the hours of work, the regular work week in the country plus 12 hours overtime. In addition, except in extraordinary business circumstances, workers will be entitled to at least one day off in every seven- day period. Manufacturers must pay all vacation, holiday, and paid time off as required by applicable laws and regulations.

Protection of the Environment Manufacturers will comply with all applicable environmental laws and regulations.

Other Laws Manufacturers will comply with all other applicable laws and regulations, including those pertaining to the sourcing of components or raw materials, manufacture, pricing, sale, and distribution of merchandise.

Subcontracting Manufacturers will not use subcontractors for the manufacture of merchandise supplied to GH or components thereof without GH’s express written consent. GH may require, as one of the conditions of approval, that the subcontractor enter into a written commitment with GH and comply with this Code of Conduct.

Monitoring and Compliance Manufacturers will authorize GH and its designated agents (including third parties) to engage in monitoring activities to verify compliance with this Code of Conduct, including unannounced on-site inspections of manufacturing facilities and employer provided housing; reviews of books and records relating to employment/labor matters; and private interviews with workers. Manufacturers will maintain on site all documentation that may be needed to verify compliance with this Code of Conduct.

Publication Manufacturers will take appropriate steps to ensure that the provisions of this Code of Conduct are communicated to workers, including the prominent posting of a copy of this Code of Conduct, in the local language and in a place readily accessible to workers, at all times.

The GH Code of Conduct for Manufacturers is not a contract and does not create any contractual rights for GH employees, Manufacturers, or third parties.

6 TERMS AND CONDITIONS FOR PURCHASE ORDERS

ALL PURCHASE ORDERS ISSUED BY GARNET HILL, INC. (“GH”) TO THE UNDERSIGNED SELLER (“YOU,” “YOUR”) ARE SUBJECT TO THE FOLLOWING TERMS AND CONDITIONS (“T&Cs”):

1. Description of Products; QA Procedures. All products purchased from You by GH (“Products”) pursuant to a purchase order (“PO”) will conform to the samples and other descriptions provided to GH. You will comply with all of GH’s quality assurance and fulfillment policies, standards, and procedures, including those contained in GH’ most current Vendor Compliance Manual (“VCM”).

2. Shipment; Delivery. Time is of the essence with regard to the shipment of Products. You must receive GH’s approval prior to shipping Products. Unless otherwise mutually agreed in advance in writing, You will ship the Products to GH no earlier than and not later than the shipping date set forth on the applicable PO. The Products will be shipped in accordance with the PO (or if no instructions in the PO, the Products are to be packaged, shipped and routed in accordance with the VCM), unless otherwise authorized by GH. You will indicate GH’s PO number on all invoices, packages and other communications with GH. You will immediately notify GH if You are unable to ship all or any portion of the Products by the ship date specified in the PO or as otherwise authorized by GH. Any POs that are not delivered by the ship date specified on the PO and for which GH has not authorized any other ship date may be canceled by GH and/or penalties and charge backs may result as set forth in the VCM. If Your acts or omissions result in Your failure to meet GH’s delivery schedules and requirements and GH requires a more expeditious method of transportation for the Products than the transportation method originally specified by GH, You shall, at GH’s option, (a) promptly reimburse GH the difference in cost between the more expeditious method and the original method, (b) allow GH to reduce its payment of Your invoices by such differences, or (c) ship the Products as expeditiously as possible at Your expense and invoice GH for the amount which GH would have paid for normal shipment. Unless otherwise specified on the PO, all “Domestic Products” (e.g., Products purchased by GH which are picked up by GH’s carrier within the continental United States) shall be delivered on a FOB GH’s Place of Destination/Warehouse, Freight Collect basis. Notwithstanding such delivery, title and risk of loss or damage to Domestic Products will not pass to GH until the Products are received at GH’s distribution center or place of business. Unless otherwise specified on the PO, all “International Products” (e.g., Products purchased by GH which are picked up by GH’s steamship/ocean carrier at an origin port outside the United States) shall be delivered on a FOB Origin, or as otherwise specified on the PO. Title and risk of loss and damage to International Products will pass to GH in accordance with the freight terms on the applicable PO. For containers loaded and sealed at your factory/warehouse, You will assume risk for all shortages if the seal applied at your factory is intact and verified by GH’s Place of Destination/Warehouse. You will provide GH, at Your expense, all assistance and documentation requested by GH for clearing the International Products through applicable customs agencies throughout the world.

3. Inspection and Acceptance. GH or GH’s authorized agent shall have the right to enter Your production facilities at reasonable times to inspect the facilities, goods, materials and any property of GH covered by this PO. GH’s inspection, whether during manufacture or storage, prior to shipment or after delivery, shall not constitute acceptance. Notwithstanding any prior inspection or payments, all Products will be subject to final inspection and acceptance or rejection at GH’s distribution center or place of business within a reasonable time after delivery. GH may reject any damaged, defective or non- conforming Products, or Products which otherwise do not conform to approved samples and specifications for color, style, fit, packaging, labeling, materials, design, and construction. Products that are damaged, defective, or non-conforming may be returned and charged back to You. Additionally, GH may choose, at Your risk and expense, to either hold such damaged, defective, or non-conforming Products pending Your instruction or return ship them to You, at Your risk and expense, at the address shown on the applicable PO.

4. Payment. Payment will be made in accordance with the terms shown on the face of the PO, based on the actual Products received. GH reserves the right to hold payment on those Products shipped early without preauthorization and in such case the payment terms as stated on the PO will still apply. All invoices will clearly reference the shipment date, PO number, and any applicable Product number(s). If You instruct GH to pay a third party, You will remain obligated to GH under this “Agreement” (as defined in Paragraph 13, below). You will immediately pay any debit balance owed to GH if GH demands payment, or if such debit balance is outstanding for more than forty-five (45) days from the date of the occurrence giving rise to the debit balance. All of Your monetary claims are subject to set off by GH for

7 any claim or counterclaim of GH. As reasonably requested from time to time, You will provide GH with a statement showing any amounts due to or owed by GH.

5. Returns. GH will have the right, in its sole discretion, to return all or any portion of damaged, defective or non-conforming Products to You. GH’s resale of any Product will not constitute a bar or waiver of GH’s right to return Products under this Paragraph 5. Title and risk of loss to any Products to be returned to You pursuant to this Paragraph 5 will pass to You upon GH’s delivery of the Products to a common carrier for return to You. You will pay all freight charges incidental to the return of any Products returned under this Paragraph 5 to Your place of business or point of shipment. You will fully and immediately refund to GH any and all payments made for Products returned by GH to You under this Paragraph 5. You shall reimburse GH for all administrative expenses and lost profits associated with back orders or order cancellations due to rejection of Product, late delivery or delivery of insufficient quantities. If You do not authorize the return of Product, within ten (10) days after GH gives notice of its intent to return the Product, GH may return such Product without authorization. If You do not authorize the return of Product within such ten (10) day period, or refuse to accept any returned Product, GH may dispose of such Product in any manner and deduct from the proceeds thereof all losses, damages, claims, costs and expenses incurred by GH in connection with such Product. In addition, GH retains its right to pursue all other remedies available to it under the law or in equity. You shall not sell or otherwise transfer any returned Product, seconds or overruns which bear GH private labels, trademarks, service marks, trade names, logos, designs, hang tags or packaging to third parties unless all such GH indicia have been completely removed or obliterated from each and every article of Product and packaging and then in the context of such disposition no reference shall be made to GH and such disposition shall not occur in a market where GH competes. You acknowledge that GH does not inspect each item of Product at receipt of merchandise and therefore You understand that damages or imperfections or failure to meet specifications (including, but not limited to, compliance with any and all laws and governmental regulations), may not be discovered by GH until after they are purchased by the ultimate customer and returned by GH after customer uses or closely examines their purchase. Authorization is expressly granted by GH to allow such returns, in the sole opinion of GH at any time, to be made for credit (or cash if GH is not currently doing business with You). Request by GH for return authorization shall not be denied by You.

6. Representations and Warranties. You represent and warrant to GH that: (i) all information You provide to GH is and will be true and correct; (ii) Your entering into these T&Cs and the performance of Your obligations hereunder will not conflict with or be prohibited or restricted by any agreements or commitments with third parties; (iii) title to Products delivered to GH will be free of all liens, claims, debts, and rights of third parties; (iv) the Products are and will be genuine and not adulterated, misbranded, or mislabeled; (v) the Products will not infringe upon any “Intangible Rights” (as defined below), and You are the owner of, or are licensed to authorize GH to use, any and all Intangible Rights associated with the Products; (vi) the Products (and all components of the Products) will not be subject to any import quota, restriction, rule or regulation preventing the importation or sale of the Products or any component thereof; (vii) the Products will be new and not used, remanufactured, or reconditioned (unless otherwise mutually agreed upon), of consistent kind and quality, and free from all defects in material and workmanship; (viii) the Products will be safe and appropriate for the purpose for which products of that kind are normally used; (ix) all manufacturers’ warranties are completely transferable, effective, and enforceable by the ultimate consumer; (x) the Products and all materials provided to GH in connection with the marketing, promotion, distribution, and sale of such Products, including, without limitation, packaging, labeling, and advertising materials for such Products, have been produced in compliance with all applicable federal, state and local laws, regulations, rules, guidelines, ordinances and standards (“Legal Requirements”), including, without limitation, laws relating to discrimination, coercion, harassment, health and safety, compensation, the environment, and use of child labor, in all locations throughout the ”Territory” (as defined below) where the Products may be sold, and neither the Products nor their purchase or sale by GH will violate any such Legal Requirements; (xi) the genuine origin of the Products will be stated on the Country of Origin Declaration, Invoice, Visa and other importation documents, and no shipment will be illegally transshipped from any other country; (xii) the Products have been manufactured in compliance with GH’s Code of Conduct for Manufacturers attached hereto as “Exhibit A” and incorporated herein by reference and (xiii) except as disclosed to GH in writing, the Products have not been subject to any products liability claims. The term “Intangible Rights” means any United States or foreign patents or copyrights or any United States, foreign, state or common law trademark, trade dress, trade name, service mark, publicity or privacy right or similar property or other right. You represent, warrant, and agree that the Products may be re-sold by GH and its affiliates in any location in which GH and/or its affiliates market, sell, or distribute Products and/or services (the 8 “Territory”). These representations and warranties are in addition to and without prejudice to all other warranties expressed or implied by law. GH has specifically relied upon all of Your representations and warranties contained in these T&Cs, and GH will continue such reliance in purchasing Products from You as if such representations and warranties were made on the date of purchase of such Products. All of Your representations and warranties, both express and implied, will constitute conditions of sale, and will survive receipt, inspection, testing, acceptance, payment and use of the Products. You will fulfill Your warranty and other obligations to end use consumers and will be responsible for any product liability claims that arise from Products that You have supplied to customers.

7. Indemnity. You will assume full responsibility and will provide independent legal counsel reasonably acceptable to GH for the defense of any claims, threatened actions, filed actions, suits, investigations or proceedings (“Claims”) that may be brought against GH or its affiliates, officers, employees, agents or assignees by reason or as a result of or relating to: (i) any actual or alleged violation or breach by You of any of Your representations, warranties, covenants, or other obligations set forth in these T&Cs or in the VCM; (ii) any actual or alleged infringement of any Intangible Rights or any actual or alleged unfair competition; (iii) any claim, representation or statement made in connection with advertising or promoting the sale of the Products by any of Your employees or agents or by any celebrity or other person provided or made available by You who is not an employee of GH, or, to the extent consistent with or substantially based on information or materials provided by You, any claim, representation or statement made in connection with advertising or promoting the sale of the Products by any person whatsoever; (iv) any actual or alleged death of or injury to any person, damage to any property, or any other damage or loss, by whomsoever suffered, resulting or claimed to result in whole or in part from any actual or alleged defect in the Products, whether latent or patent, or the failure of such Products to comply with any express or implied warranties; and/or (v) any actual or alleged violation by the Products or their manufacture, possession, use or sale, of any law, statute or ordinance or any governmental order, rule or regulation. You will indemnify, defend and hold GH and its affiliates, officers, employees, agents and assignees harmless from and against any and all liabilities, injuries, damages, settlements, royalties, penalties, fines and other losses of every kind and nature whatsoever, including without limitation all attorney fees and other costs and expenses, incurred by or imposed upon them as a result of or in connection with any such Claims, or as a result of or in connection with any recalls of Products, whether voluntary or involuntary, or any actions taken to comply with all laws, regulations, rules, guidelines, ordinances and standards governing the safety, labeling, advertising or invoicing of Products, or any actual or alleged failure to comply with any bulk sales law or similar law for the protection of creditors. No settlement of any such Claims may be made without GH’s prior written consent to the terms of settlement. GH will have the right to participate in the defense of any such Claim at its own expense. If GH notifies You of a Claim to which the foregoing indemnification obligation applies (“Claim Notice”), You shall provide prompt assurance of Your ability and intent to indemnify GH, to GH’s reasonable satisfaction, and You shall commence to defend such Claim, at Your sole cost and expense, within five (5) days of said Claim Notice. If You fail to provide such assurance or fail to commence such defense within said five (5) day period, in addition to the other rights and remedies available to GH at law or in equity, GH may, at its option, assume the defense or settlement of such Claim in its own name, and all recoveries from such Claim shall belong to GH, and all fees and costs (including reasonable attorney fees) in defending such Claim, and all damages or settlement costs arising therefrom, shall be Your sole responsibility.

8. Confidentiality. You will not advertise or publish the fact that GH has contracted to purchase Products from You, and will not disclose any information relating to these T&Cs to any third party. You will treat all information furnished by GH, its parent, subsidiary, and affiliated companies as confidential, property of GH and will not disclose any such information to any third party, or use such information for any purpose other than performing Your obligations under these T&Cs, except that You may disclose such information solely: (i) to Your employees, accountants, independent contractors, agents, and attorneys on a need-to-know basis, provided the recipient of such information has executed appropriate written agreements to ensure the confidentiality of such information consistent with these T&Cs; and (ii) under the terms of a subpoena or order issued by a court of competent jurisdiction or under a civil investigative demand or similar process, provided You agree (a) to promptly notify GH of the existence, terms, and circumstances surrounding such a request, and (b) if You are, in the opinion of Your counsel, compelled to disclose a portion of such information, You disclose only that portion of the information that Your counsel advises that You are compelled to disclose, and will exercise reasonable efforts to obtain assurance that confidential treatment will be accorded to such information. You will treat all information obtained from customers as confidential and will not disclose any such information to any third party, or use such information itself for any purpose other than performing Your obligations to GH. Specifically, but without 9 limitation, You will not use any information obtained from GH or customers to offer for sale to such customers any Products or services. You will not issue any press or publicity release or statement relating to GH, any of its affiliates or operations, or these T&Cs without the prior written approval of GH. You acknowledge and agree that any communication between counsel for You and GH, or between You or GH or any of their principals, employees, contractors or representatives, and Your counsel or GH is protected by all applicable privileges, including without limitation the attorney-client, work product and joint defense privileges. You will not waive any such privilege without the express written consent of GH.

9. Standards of Conduct; Taxes; Customs . a. You will comply with all standards of conduct published and made available to You from time to time by GH and will promptly disclose in writing to GH any conflicts of interest or any circumstances that are inconsistent with or constitute a violation of the terms or spirit of such standards. Furthermore, You acknowledge and agree that there is a common interest between You and GH in advertising claims relating to the Products, and in ensuring that all such claims are in compliance with all laws, government rules, and regulations regarding deceptive advertising and substantiation of advertising claims. Without GH’s prior written approval, You will not include Your address, telephone number, web site address, or other contact information in any packaging or labeling of the Products for the purpose of marketing or promoting any Products or services, other than customer or technical assistance services. b. Any present or future sales, use, privilege, occupation, excise, value-added or other tax, fees or charges of any nature whatsoever imposed by any governmental authority on the transaction set forth in this PO shall be paid by You. No such taxes, charges, fees, etc. shall be paid by You on behalf of GH without GH’s prior written consent. In the event that GH is required to pay any such taxes, fees or charges, You shall reimburse GH therefore. c. You warrant and represent that You understand the United States Rules of Origin as set forth in Part 102 of the United States Customs Regulations and that its textile origin declaration, if applicable, will accurately and completely set forth the processes performed in each country and the source of all fabric and trim. You will not enter into any arrangement with any third party for the manufacture or sub- assembly of any International Products supplied to GH without prior written notice to GH. In order to maintain GH’s high standard of quality control and to ensure that appropriate measures are taken against counterfeiting, such notice will include the following information: (i) name and address of each manufacturer; (ii) type and style of the Products to be manufactured; (iii) quantity of the Products to be manufactured; and (iv) any other relevant information. You acknowledge that You will remain primarily liable and completely obligated under all of the provisions of these T&Cs in respect of any such subcontracting arrangement.

10. Most Favored Nations; Exclusivity; Non-Compete; Non-Solicitation. a. All of the prices, terms or benefits granted by You for any Products purchased by GH under this Agreement are equal or better than the prices, terms or benefits being offered by You to any present commercial customer for the same or comparable product ordered in the same or comparable quantities. If during the term of this Agreement You enter into an arrangement with any other company for the same or comparable product ordered in the same or comparable quantities providing greater benefits of more favorable pricing or terms, You shall promptly notify GH in writing and then with respect to any open PO through date of delivery and any subsequent PO issued by GH and accepted by You shall, at GH’s option, automatically be deemed amended to provide the same benefits or pricing to GH. b. Any Products developed for GH by You under this Agreement will be made exclusively for GH for a minimum of one (1) year so long as the Product is not otherwise available in the U.S. marketplace. Notwithstanding anything contained in the Agreement to the contrary, all product designs, design process, artwork and all other proprietary information of GH furnished to You by GH must be used exclusively for Products supplied to GH and to no third party and You acquire no rights, title or interest in the foregoing. c. You agree that for a period of six (6) months after Your sale of Products to GH, You will not, directly or indirectly, sell substantially similar Products by means of a direct mail catalog, or its associated website(s), other than GH.

10 d. For a period of one (1) year after each PO issued by GH to You, You will not solicit for employment (other than a general, publicly disseminated solicitation for employment) or offer to employ any employee of GH.

11. Insurance. You have and will keep in effect for five (5) years from the date of Your receipt of the first PO issued by GH, full general/products liability insurance coverage in amounts not less than those required by Your “Insurance Class,” as determined by GH’s risk management department (“GH Risk Management”).

Insurance Class Examples Insurance Requirements

I Apparel, Coins, Jewelry, Rugs, Table Top Items, Textiles, Household Linens $1,000,000 General/Products Liability per Occurrence $2,000,000 General/Products Liability aggregate

II Appliances, Beauty and Cosmetics, Cleaning Products, Computers, Cookware, Electronics, Seasonal, Tools $2,000,000 General/Products Liability per occurrence $4,000,000 General/Products Liability aggregate

III Active Fitness, Medical Devices, Toys, Pressure Cookers $6,000,000 General/Products Liability per occurrence $8,000,000 General/Products Liability aggregate

In addition if: 1) You are offering any services; 2) You have had any product recalled; 3) GH determines, in its reasonable discretion, that the Products are subject to a license or are otherwise specifically warranted by an Your individual circumstances, including, but not limited to, prior losses or claims history, whether with GH or otherwise, You will also be required to provide $1,000,000 Errors & Omissions (or its equivalent) per occurrence and $2,000,000 in the aggregate. All insurance required by GH Risk Management must: (i) be maintained with an Insurance Company rated by A. M. Best as “A” or better; (ii) name GH, its direct and indirect parents, subsidiaries, affiliates, and assigns as Additional Insured; and (iii) be submitted with a copy of Your Additional Insured Vendor Endorsement or the complete policy (or policies), in the English language. You must also provide the name of a specific person (including mailing address, phone and fax numbers, and email address) who is in charge of responding to complaints, claims, and/or lawsuits. All of these Insurance Requirements must be demonstrated by submission of one or more Certificates of Insurance sent to the attention of Vendor Compliance Division at 231 Main Street Franconia, NH 03580 promptly following Your execution of these T&Cs, and no less frequently than annually thereafter upon the anniversary date of the applicable policy. These Insurance Requirements may be satisfied through a combination of primary, umbrella, or excess liability insurance policies. GH Risk Management may, at its sole discretion, change the coverage limits and/or types of coverage required at any time.

12. Relationship of Parties. It is expressly acknowledged by the parties hereto that Your relationship to GH under this Agreement is that of an independent contractor and nothing in this Agreement is intended or shall be construed to create an employer/employee relationship, or a joint venture relationship. You understand and agree that GH will not withhold on behalf of You pursuant to this Agreement any sums for income tax, unemployment insurance, social security, or any other withholding pursuant to any law or requirement of any governmental body relating to You or make available to You any of the benefits afforded to GH’s employees and that all such payments, withholding, and benefits, if any, are Your sole responsibility. 11 13. Entire Agreement; Amendment; Assignment. These T&Cs and any other documents referred to herein constitute the entire agreement (collectively, the “Agreement”) between You and GH. This Agreement will be effective for all Products. You accept and agree to be bound by the Agreement by shipping Products. This Agreement sets forth the entire understanding and agreement of the parties with respect to the matter covered herein, superseding all prior and contemporaneous understandings and agreements, whether oral or written. This Agreement may not be modified or amended except by a written instrument executed by both parties, and each shipment received by customers will be deemed to be only upon the terms and conditions contained in this Agreement, notwithstanding any terms and conditions that may be contained in any of Your acknowledgements, invoices or other forms and notwithstanding GH’s or its customers’ act of accepting or paying for any shipment or similar act of GH or its customers. GH has the right to assign this Agreement, or all or any portion(s) of its rights and/or obligations hereunder, including, without limitation, the right to purchase, market and sell the Products, to any company directly or indirectly controlling, controlled by, or under common control with GH, and this Agreement shall inure to the benefit of any such assigns. You may not assign any rights, obligations, and/or or claims under this Agreement without GH’s prior written consent, and any attempted assignment without consent will be void.

14. Governing Law; Jurisdiction. This Agreement, and the legal relationship between You and GH will be governed by Ohio law, without regard to conflicts of law principles and without reference to the United Nations Convention on Contracts for the International Sale of Goods. Any legal action or proceeding with respect to this Agreement may be brought only in the courts of the United States District Court for the Southern District of Ohio and the Court of Common Pleas located in Butler County, OH and each party hereby accepts the jurisdiction of such courts. You hereby irrevocably waive any objection, including, without limitation, any objection to the laying of venue or based on the grounds of forum non conveniens, which You may now or hereafter have to the bringing of any such action or proceeding in such respective jurisdictions. If any litigation is commenced to enforce any provision of this Agreement or to seek a declaration of the rights of the parties hereunder or as a result of any breach or threatened breach of any provision of this Agreement, the prevailing party will be entitled to recover from the non- prevailing party all of its costs and expenses incurred in connection with such litigation, including without limitation reasonable attorneys’ fees, at both the trial and appellate levels.

15. Notice. All notices or other communications required or permitted under this Agreement must be in writing, addressed to the address written below or to such other address for a party set forth in a notice given to the other party, sent to the intended recipient by prepaid registered mail, receipted commercial courier, or electronically receipted facsimile transmission, and will be effective upon delivery to the intended recipient. All communications to GH shall be sent to the attention of Vendor Compliance Division at 231 Main Street Franconia, NH 03580.

16. Termination. Either party may prospectively terminate the Agreement by giving the other party written notice of termination, which notice specifies an effective date of termination that is not less than thirty (30) days after notice is actually received by the non-terminating party (unless otherwise agreed to in writing by the parties), in which event this Agreement will terminate as to all Products not ordered prior to such effective date. Furthermore, GH reserves the right to cancel all or part of any PO, without liability to You if You: (i) repudiate or breach any of the material terms of these T&Cs or the PO, including Your warranties, (ii) fail to ship the Products ordered on the ship-by-date, (iii) fail to perform services or deliver Products as specified by GH in these T&Cs or in the PO, (iv) fail to make timely and proper completion of services or delivery of Products, or (v) fail to otherwise conform to the T&Cs. You may liquidate cancelled merchandise if: (i) the Products contain no GH labels, packaging or reference, (ii) the Products are not represented as GH’s own and (iii) the Products are not liquidated in a market where GH competes. After the effective date of such termination, all Paragraphs hereunder concerning the parties’ rights and obligations which by the content of the Paragraph operate after termination (e.g., Your returns obligations) or which are necessary to enforce any right will survive any termination or expiration of this Agreement.

17. Force Majeure. Neither party shall be responsible for failure or delay of performance if caused by: an act of war, hostility, or sabotage; act of God; flood, hurricane, or other natural disaster; electrical, internet, software, telecommunication, or other systemic outage that is not caused by the obligated party; government restrictions; or other unforeseeable event outside the reasonable control of the obligated party (collectively, “Force Majeure Event”). Both parties will use reasonable efforts to mitigate the effect of a Force Majeure Event. Only if such event continues for more than forty-five (45) days, either party 12 may cancel a PO or any other unperformed services upon written notice to the other. This Paragraph does not excuse either party’s obligation to take reasonable steps to follow its normal disaster recovery procedures.

18. Miscellaneous. Each party acknowledges and agrees that any failure on the part of the other party to enforce at any time, or for any period of time, any of the provisions of this Agreement will not be deemed or construed to be a waiver of such provisions or of the right of said party to thereafter enforce each and every such provision. The headings and sub-headings used in this Agreement are for convenience only and are not a part of this Agreement. If any provision of this Agreement is declared null, void or otherwise unenforceable, such provision will be deemed to have been severed from this Agreement, which will otherwise be and remain in full force and effect according to its remaining terms; provided, however, that both parties shall negotiate in good faith with respect to an equitable modification of the paragraph, subparagraph or provision held to be invalid and provisions logically related thereto. Any specific right or remedy provided in this Agreement will not be exclusive but will be cumulative upon all other rights and remedies set forth herein and allowed or allowable under law. All Paragraphs hereunder concerning the parties’ rights and obligations which by the content of the Paragraph operate after termination (e.g., returns obligations) or which are necessary to enforce any right will survive any termination or expiration of this Agreement.

ACCEPTED AND AGREED:

Print Your company name:

Print Your company address:

By: Date: Signature

Print name of person signing Title of person signing

13 ACKNOWLEDGMENT OF GARNET HILL VENDOR COMPLIANCE MANUAL

Garnet Hill Code of Conduct All vendors must comply with these standards.

Purchase Orders All purchase orders will be emailed to the contact you provide below.

Top of Production (TOP) Approval is required of TOP samples prior to a bulk order being shipped.

Item labels Vendor must affix individual item labels to each packed unit with the Garnet Hill item/color/size identified on the purchase order.

Case Size Requirements Case size should not exceed 40”(L)x26”(W)x26”(H). Ship separate items do not need to conform to these requirements.

UCC-128 Case Labels Vendor must complete and affix a UCC-128 label to each case in a shipment. Placement is in the lower left corner of the smallest face of the case. Chargebacks are $250 for each purchase order where the UCC-128 label is missing, incorrectly placed or incorrectly filled out.

Advance Ship Notification (ASN) Vendor must create an ASN using our software. An emailed copy must be sent prior to scheduling the shipment with the carrier. Chargebacks are $250 for each ASN that is missing, late or incorrect.

Carrier Selection The Garnet Hill Routing Guide found on http://www.ccsginc.com/garnet.htm must be used to select the appropriate carrier. No unauthorized shipments will be accepted.

It is acknowledged by this signature that the information contained in the Garnet Hill Vendor Compliance Manual has been reviewed and is accepted. Purchase orders will be shipped compliant to Garnet Hill, Inc. as outlined in this manual. Expenses incurred as a result of non-compliant orders will be the sole responsibility of the vendor. It is extremely important that your shipping personnel understand these requirements.

Return to Vendor Relations Coordinator [email protected] or Fax: 603.823.8406 ______Company: PO Contact:

Address: PO Tel:

Address: PO Fax:

City/State: PO Email:

PO FOB POINT______

14 Zip: Date:

Authorized Signature:

Title:

15 QUALITY REQUIREMENTS

16 Quality Planning

Garnet Hill is committed to providing superior quality merchandise and service to its customers. We recognize that superior merchandise quality is achieved through unrelenting attention to detail, from product conception to customer purchase and beyond. This philosophy mandates the development of close relationships with our vendors, systematic monitoring of incoming products and the evaluation of customer response to product quality.

We believe that the burden of producing quality products rests with the vendor. We also believe that it is our responsibility to support our vendors by clearly defining our expectations, requirements and standards. We build vendor partnerships on a foundation of openness and trust.

All products are expected to meet the minimum performance, safety and testing standards that are detailed in the enclosed document “Testing and Performance Standards.”

The Top of Production Review described below is an important part of assuring the quality of our product and enabling vendors to be successful in meeting all expectations.

Garnet Hill inspects all incoming bulk shipments using a statistical sampling plan. Our inspection guidelines support our efforts to provide customers with the best products available by ensuring that we receive goods as specified from our vendors. Our critical inspection is based on high quality expectations. Products are measured to ensure conformance to the approved sizing specifications within established tolerances and then checked for defects and conformity to all specifications.

When a shipment fails an incoming inspection, Garnet Hill may choose to conduct 100% inspection for which the vendor will be charged labor costs at $50 per work hour. If a significant quality problem is discovered, Garnet Hill may decide to return the product to the vendor without completing 100% inspection.

Garnet Hill requires its vendors to have an effective quality system in place to monitor and assure quality performance. This includes testing and inspection of materials used, inspection of work-in-progress and a final quality audit of finished products. The audit of finished products should be conducted independently of production management, incorporating statistical sample methods. This final quality audit will verify that products meet all Garnet Hill specifications, including those for construction details, choice of materials, color and sizing. Shipped lots must be free of defects, dirt, or damage. Merchandise is to be packaged according to Garnet Hill requirements, with all labeling applied as specified.

We believe that by working together to produce superior quality merchandise we will ensure our mutual success.

17 TOP OF PRODUCTION: Quality and Packaging Samples

The TOP review is part of Garnet Hill’s Quality Assurance Program. This process requires vendors to send samples from the production run to Garnet Hill in Franconia, NH for review and approval before the bulk shipment is sent to the distribution center in Ohio.

During the review, products are measured/washed/checked against buyer specifications and compared to photo samples and catalog photos. Packaging of hard goods is tested according to our packaging requirements.

The goal of the review is to verify that the product is as purchased, is first quality, and is packaged adequately. The review also gives us the opportunity to check package labeling and identify any product issues that can be corrected while the goods are still in the vendor’s facility. This saves the vendor time and expense in making corrections.

Receiving these samples ahead of the shipment is essential to the efficient receipt of the shipment at our distribution center. If samples are not received and reviewed in Franconia ahead of the shipment, receipt of the bulk shipment and payment of goods will be delayed. For this reason, vendors will be charged a penalty for not sending TOP or shipping bulk shipments before TOP approval.

TOP OF PRODUCTION: Procedure

1. TOP Sample Requirement Garnet Hill requires that samples of each new item be sent to Garnet Hill in Franconia, NH for approval before the bulk shipment is released from a vendor’s facility. Vendors will receive a special purchase order specifying the items to be sent.

2. Actual Production Merchandise and Packaging The TOP samples are to be first off the production line and packaged and labeled as the bulk production will be packaged and labeled. If production will be individually boxed, it must be boxed as bulk production will be boxed. Approval samples will not be requested on reorder shipments unless the product has changed in any way: i.e. sizing, fabric, or make from the original.

3. Samples Arrive in Advance of Shipment TOP samples must arrive in Franconia, NH in advance of the specified ship date for the bulk shipment, so approvals do not delay shipping. The TOP Purchase Order will specify the ship date required. This date will be 15-30 days in advance of the bulk ship date. We require a minimum of 5 working days to review and approve TOP samples.

4. Shipment Held for Approval Do not release the bulk shipment of goods until Garnet Hill has received and approved these samples. Garnet Hill quality staff will call or email approval when the goods are approved to ship. If you cannot hold a shipment pending approval, call Garnet Hill to discuss this shipment.

5. Payment for Samples Garnet Hill will pay for these samples if they are first quality and are packaged and labeled as finished product. Send an invoice for these items. Samples that are not first quality or are mutilated, will not be paid for.

6. Transit Method Address these samples to: Garnet Hill TOP OF PRODUCTION 231 Main Street 18 Franconia, NH 03580 USA Send samples the best way to facilitate approval. Use expedited shipping only if necessary to meet the approval time line. Notify Garnet Hill with information about when the samples were sent and by what carrier. Call TOP Staff: (603)-823-5545

19 Testing and Performance Standards

Testing and Performance Standards: Apparel and Textiles Property Standard Test Method Tensile Strength: Woven 25 lb./in. ASTM D 5034 Burst Strength: Knits 40 PSI ASTM D 3786 Tear Strength: Woven 3.0, (Flannel 2.0) ASTM D 1424 Seam Slippage less than 1/4" @ 15 lbs. ASTM D 434-95 Seam Strength 15 lb. ASTM D 1683 Colorfastness to Crocking (Rubbing) AATCC 8 - 1996 Dry 4.0 ** Wet 3.0 ** Colorfastness to Washing - Home Laundering AATCC 61-1996 Shade Change 4.0 Staining 3.0 *** Colorfastness to Dry-cleaning AATCC 132-1998 Shade change 4.0 ** Staining 3.0* ** Colorfastness to Perspiration AATCC 15-1997 Shade change 4.0 ** Staining 3.0 * ** Colorfastness to Non-Chlorine Bleach 4.0 AATCC 172-1997 Dimensional Change in home laundering Acceptable after wash AATCC 135/150-2000 sizing or as specified Colorfastness to Light - 20 hours AATCC 16-1998 Curtains 3-4 ** Garments 4.0 ** Home Bedding Products 3.0 ** * If appearance is unacceptable at 3, fabric will be rejected ** Light Box Viewing Conditions: D65/U30 *** If lower than 3.5 must be labeled: Wash Separately Skewness change in fabric and garment twist in home laundering AATCC 179-1996 Garments - woven 1% after wash Garments - knits 2% after wash Home bedding products - knits 5% after wash Home bedding products - woven 3% after wash Fabric Weight - ounces per square yard + or -5% from purchase ASTM D 3887 weight Pilling resistance - 30 min Random Tumble Pilling Tester Method ASTM D 3512 After 3 launderings Apparel 4 Napped Goods 3 Flammability Apparel: Adult and Children’s apparel Class 1 16 CFR 1610 (Test Suspect fabrics: Napped and lightweight fabrics: < 3.0 oz/sq.yd.) Verify exempt content or exempt weight. Mattresses and Mattress Pads Pass 16 CFR 1632 , and CA TB 106 Children's sleepwear: Tight Fitting/ Flame Retardant Comply 16 CFR 1610, 1615, 1616 Small Rugs Pass or be labeled 16 CFR 1631 (FF2- 70) Less than 24 sq ft and less than 6 ft in any one dimension Label to read: " Flammable, fails US Dept of Commerce Standard FF 2-70, Should not be used near source of ignition.”

Carpets Pass 16 CFR 1630 (16 CFR FF1-70) Greater than 6 ft in one dimension or greater than 24 sq ft.

Sleeping Bags Pass ASTM 1955-99

20 Testing and Performance Standards: Apparel and Textiles Blankets Class 1 ASTM D 4151 Purity of specialty animal fiber Pass AATCC 20A - 2000 Sterility of Stuffing Materials: Pillows, battings, Comply and be labeled State Regs: i.e. Ohio with required Law Label mattresses, sleeping bags, furniture CHILDREN’S PRODUCTS COMPLY with all HR4040 CPSIA requirements

Drawstrings: children's clothing sizes 0-16 Comply ASTM F1816 No drawstrings at neck. At Waist, sewn at midpoint, restrict total length per requirement.

Tracking labels Comply CPSIA Lead Content of all Substrate used in Children’s 300 ppm(Aug 2009) CPSIA 16 CFR 1500.230 products 100 ppm (Aug 2011) Lead Content Of Surface Coatings 90 ppm 16 CFR 1303 CPSIA Small Parts (If attached small pieces do not pass the Cannot fit in test cylinder 16 CFR 1501 CPSIA Small Parts test, the attachment method must pass Use and Abuse testing, i.e. zipper pulls, buttons, snaps…).

Use and abuse/test attachment method Pass 15 lb test 16 CFR 1500.53 Sharp Points and edges Cannot be present 16 CFR 1500/ASTM F963 CPSIA

Testing and Performance Standards: Hard Goods

Property Standard Test Method Art Materials: toxicity Pass ASTM D 4236 Bouncy Seats Pass 16 CFR 1500.168(a)(6). 1500.86(a) Bunk Beds pass ASTM - F 1427 Candles No Lead content in wick (metal wicks) < 0.06% by weight (600 16 CFR 1500.17 ppm total lead)

Consumer Burn Warning Label required on product ASTM F2058-00 Candles should always be placed away from flammable material, on a fireproof receptacle, and out of children's reach. NEVER LEAVE A BURNING CANDLE UNATTENDED. Safe burning characteristics (candle and candleholders) Flame height <3" base to ASTM PS 59-02 tip. No secondary ignition, no tip over, no breakage of container. Ceramics and Glassware Pass ASTM C 738, CA 65 CA Prop 65 stds Lead Content Flatware:0.226ppm, Small hollowware: 0.1 ppm, Large hollowware: 0.1 ppm, Cups, Mugs: 0.1 ppm, Pitchers: 0.1 ppm Cadmium Content Flatware:0.1ppm, Small hollowware: 0.1 ppm, Large hollowware: 0.08 ppm Cribs conform 16 CFR 1508, 1509, 1511

Floor Cushions and Bean Bags Styrofoam beads must be 16 CFR 1500-1512 enclosed in separate liner. Seam strength must perform to tension test @ 15 lbs. ASTM F963

21 Testing and Performance Standards: Hard Goods

Furniture Tip Over ( Children's items > 30" Pass ASTM F 2057 height) Furniture targeted for children Pass ASTM F 963 and CPSIA Furniture: Flammability Furniture: Cigarette Resistance Pass CA TB 117 Furniture: Small Flame Resistance Pass CA TB 117 High Chairs Pass ASTM F404-99a Lighting and Lamps UL Approved All Painted Products- Adult < 0.06% by dry weight 16 CFR 1303 Personal Care Products - Adult Pass 21 CFR 1,2,20,250,700,701,720 740 FDA Toys: Any product determined to have possible "children's Comply with all CPSIA ASTM F963 and CPSIA play value" requirements Test for: Small parts, toxicity, pinching, entrapment, edges, points, projections, All Children’s product- for under 12yrs folding mechanisms, holes, clearances, stability, confined spaces, stuffing, beanbag filling, use and abuse, tip over, flammability… Must be labeled with product label as required by CPSIA.

Stated Age Recommendations Comply ASTM F 963 If not intended for a child under 3 yrs,or contains marbles or Comply ASTM F 963 small balls must have a warning label on product Phthalates in Toys or Child Care Articles: BBP/DBP/DEHP Less than 0.1% CPSIA DnOP/DINP/DIDP Lead content in paints and surface coatings 90 ppm 16 CFR 1303

Lead in substrate materials 300 ppm(Aug 2009) CPSIA 16 CFR 1500.230 100ppm (Aug 2011) Sterility of Stuffing Materials Comply and be labeled State Regs: i.e. PA - A 249 with required Law Label

Toy Chests Comply ASTM F834-84(1999)

22 CPSC and CPSIA The Consumer Product Safety Improvement Act (CPSIA), which was enacted on August 14, 2008, imposes new requirements on a wide variety of products that are regulated by the U.S. Consumer Product Safety Commission (CPSC). Regulated Products  Refer to website for CPSC Regulated Products list (the product listed below is not a complete list) (www.cpsc.gov/businfo/reg.html General Conformity Certificate  Section 14(a)(1) of the Consumer Product Safety Act, as recently amended by the CPSIA, requires a General Certification of Conformity to be issued with respect to every product that is subject to any consumer product safety rule, ban, standard, or regulation enforced by the CPSC.  The GCC is required for all import and domestic products subject to all applicable rules, bans, standards and regulations. Products without the required certificate cannot be imported or distributed in commerce in the United States.  The GCC requirement is immediately applicable to products manufactured on or after November 12, 2008.  ALL import & domestic vendors must meet the GCC requirement per the CPSC. The law applies to ALL applicable products and for ALL brands (National, Vendor, Market, No brands, etc.).  Refer to website for CPSIA GCC requirements information (www.cpsc.gov/about/cpsia/cpsia.html). RUGS: Flammability  ALL rugs must be in compliance with Federal Flammability Regulations 16 CFR 1630/1631. Test reports must be provided.  Small Rugs less than 24 sq ft and less than 6 ft in any one dimension must pass or be labeled for 16 CFR 1631 (FF2-70).  Large rugs/carpets greater than 6 ft in one dimension or greater than 24 sq ft must pass 16 CFR 1630 (16 CFR FF1-70).

LEAD: in Substrates and Surface Coatings  Lead in substrates and coatings: vendors must certify compliance to the 300ppm lead in substrates and 90 ppm lead in coatings.  Painted items must pass 16 CFR 1303 at 90 ppm.

FOOD USE ITEMS  All food use items must be in compliance with FDA Standards and California Prop 65 standards for Lead and Cadmium limits.  Please provide test reports for the items.

MATTRESS PADS  ALL mattress pads must be in compliance with Federal Flammability Regulations. Please provide flammability test reports. Please refer to 16 CFR 1632 for detailed requirements.  Ohio Bedding Regulations Filled Product: Law Label: all filled product must have an attached law label with Registry number.

FILLED PRODUCT: SLEEPING BAGS, STUFFED TOYS, FURNITURE  Products with hidden stuffing must have a Law Label attached that certifies the sterility of stuffing material.  This regulation is administered by State governments. For Garnet Hill, you must be registered with the State of Ohio. For application forms, Go to: http://www.com.ohio.gov/dico/docs/bedd_BeddingApplication.pdf CANDLES: CANDLE HOLDERS  All candles or candle holders must be labeled with a burn warning.

23 Children’s Products: Any product intended or marketed for children 12 years and under. Lead Content of substrate  As of 8/14/09, there is a 300 ppm limit for lead content in substrate materials of children’s products. Substrate is the material of which something is made, and to which surface coating may be applied. As of 8/14/11, the limit shall be 100 ppm if possible.  Fabric plain and dyed from natural and synthetic fibers is exempt from lead testing.  Printed fabric is not exempt, must be tested and conform to the limit.  Leather is not exempt, must be tested and conform to the limit.  Any metal button, zipper, bead or other embellishment must be tested and conform to the limit. Lead Paint  As of 8/14/09, the limit for lead in paint on children’s products, furniture and paint is set at 90 ppm. This requires 3rd party testing and certification.  Any painted button, zipper, snap or other component with painted surface must conform. Apparel Flammability: 16 CFR 1610 (Applies to adult and children’s clothing)  Napped and lightweight (< 2.6 oz/sq yd) fabric must be tested and pass as a Class 1 fabric.  Plain surface fabric > 2.6 oz/sq yd is exempt from flammability testing, weight must be verified.  100% or blends of: Wool, Nylon, Acrylic, Polyester are exempt from flammability testing, content must be verified Drawstrings: ASTM 1816  No drawstrings allowed on hood or neck of upper wear.  Drawstrings at waist of upper wear and bottoms: be tacked at center back; not longer than 3” protruding from channel when fully extended- no knots or toggles at ends.  Other ties: cannot be longer than 5” protruding from channel when fully extended.  Sashes: not longer than 14” measured from the point to be tied. Small Parts: 16 CFR 1502  Any article intended for use by children under 3 years must not be a small part or contain components that are small parts and present choking hazards.  Functional buttons are exempt but must be attached to pass the 15 lb pull test.  Decorative buttons, zipper pulls, embellishments must be attached to pass the 15 lb pull test. T o y s  Any item that has “play value”: must be tested and pass to the ASTM F963 standard for: Mechanical Hazards, Flammability of Solids, Soluble Heavy Metals, Folding Mechanisms. European EN-71 testing or CE certifcation is not a substitute for ASTM F963 testing.  Toys-with magnets: Must be labeled with warning label specified in ASTM F963 and no hazardous magnets or magnetic components allowed in toys for up to 14 yrs. J e w e l r y  Must pass lead content limits for all components and findings as specified in 16 CFR 1303 and 1500.230:300 ppm for children up to 12 years. Art Materials  Must be tested and pass the toxicity and lead standard of ASTM D4236. Provide testing results. Floor cushions/ bean bags with styrofoam beads  Beads must be enclosed in an inner liner. Seam strength of liner must pass the 15lb/10 sec test. Sleeping Bags  Must pass ASTM F1955-99 Flammability test. Cribs  Must pass design specifications of 16 CFR 1508, 1509. Bunk Beds  Must pass design specifications of 16 CFR 1213, 1513, 1500.18.. Toy Chests  Must pass design specifications (locking hinge and ventilation) of ASTM F834. Tracking Labels for Children’s Products (effective 8/14/09)  Permanent distinguishing marks on a permanent label attached to children’s products and the packaging is required.  The labels must include: Manufacturer or private label name, Location of production (City, State/province),Date of production,Tracking Code :( batch, run #

24 California Prop 65 Compliance: Lead content in Belts, Footwear, Wallets, Handbags (Adult product)  The lead limits required by the settlement have different implementation dates for manufacturing, selling, material type, and product type.  Commencing December 1, 2010, for wallets, handbags, purses, clutches and totes, and commencing August 1, 2011 for belts or footwear , Garnet Hill cannot purchase, import, manufacture or supply and Covered Product that will be sold to California consumers and which exceeds the following lead limits: o Paint or Surface Coatings on Accessible Components: 90 PPM; o Leather (including composited leather): 600 PPM; and, commencing December 1, 2011 for wallets, handbags, purses, clutches and totes, and commencing December 1, 2012 for belts or footwear, 300 PPM; o Polyvinyl Chloride (“PVC”) Accessible Components: 300 PPM; and commencing December 1, 2011 for wallets, handbags, purses, clutches and totes, and commencing December 1, 2012 for belts or footwear, 200 PPM o All other Accessible Components (excluding cubic zirconium, glass or rhinestones): 300 PPM.  Garnet Hill must have on file the testing results for lead content in all the products discussed above.  The tests all Vendors are required to provide are: o Paints and Surface Coatings on Components: 16 CFR 1303 Lead Content o Lead in Substrate materials: 16 CFR 1500.230 CPSIA 2008/EPA 3050,3051,3052

Other Regulatory Labeling Several industries require labeling for various products. Please be sure that all mandatory labeling is on the product. We will inspect upon receipt of shipment. Following are a few of the labels we will be looking for:  Candle Burn Warning Label  ORM-D (Other Regulated Materials – Domestic)  Suffocation Warning Label  Fair Labeling FP&L / Uniform P&L Regulations NIST  LHAMA Label  Ohio Bedding Regulations Filled Product: Law Label  Small Parts Warning Label  FTC: Care, Content, Country of Origin Label

25 Wood Packaging Material (WPM)

On September 16, 2005, U.S. Customs and Border Protection (CBP) implemented a plan to enforce the United States Department of Agriculture’s (USDA) Animal and Plant Health Inspection Service (APHIS) import regulation for wood packaging material (WPM).

The rule requires WPM, such as pallets, crates, and boxes, used in international trade to support or brace cargo, to be treated to prevent the introduction of harmful insects to U.S. agriculture and to natural, cultivated, and urban forests resources. The approved treatments are 1) heat treatment to a minimum wood core temperature of 56ºC for a minimum of 30 minutes or 2) fumigation with methyl bromide. To certify treatment, the WPM must be marked with the approved International Plant Protection Convention (IPPC) logo. Unmarked WPM will be considered untreated and non-compliant and reexported at the importer of records expense.

XX Represents the ISO country code 000 Represents the unique number assigned by the national plant protection organization YY Represents either HT for heat treatment or MB for methyl bromide fumigation

26 WOOD COMPOSITE REQUIREMENTS (CARB) Composite Wood Products

California Air Resources Board (CARB or ARB) has released a regulation to reduce formaldehyde emissions from composite wood products sold in California Emissions standards are broken into Phase 1 and Phase 2 with varying dates for compliance.

You are responsible for reviewing the full regulation and being fully compliant (the full regulation may be found at http://www.arb.ca.gov/toxics/compwood/compwood.htm.)

Materials Covered:  Hardwood Plywood (HWPW) (separated into veneer core and composite core)  Particleboard (PB)  Medium Density Fiberboard (MDF) (Standard or Thin) –includes Low-and High-Density  All products made from above materials regardless of finish (ex. paint, laminate, coatings, etc.)  Finished and Unfinished Products

Items Covered:  This regulation includes all items with these composite woods. It therefore includes wood wall decorations & shelves, wood mirrors, pallets made of composite woods, jewelry boxes, wood desk caddies and all furniture …

Required Labeling  Any item manufactured using HWPW, PB or MDF must be labeled in accordance with 93120.7(d) to confirm compliance to the approved Airborne Toxic Control Measure (ATCM) enacted to reduce Formaldehyde emissions from composite wood products. Labels must include, at a minimum, the following information: o Fabricator’s Name o Date the finished good was produced o A statement of compliance to denote that the composite wood product complies with the ATCM

27 Individual Item Packaging Requirements

All merchandise must be individually packaged and labeled. Packaging must be designed to meet the needs of the rigorous handling necessary for the mail order process. This includes: shipping to our Distribution Center, Handling within our Distribution Center, Shipping to our customer, and then as needed, being returned by our customer to our Distribution Center. These are stricter shipping and handling conditions than what is encountered in retail or more traditional distribution methods. Packaging of breakables and larger “ship alone” items must pass the “Package Testing Requirements”.

Polybags

All polybags must be a clear poly with a minimum thickness of 1.00 mil. Bags must have vent holes (they can be purchased pre-punched). The polybags must completely enclose products and be heat sealed, self sealed or securely taped. Envelope bags or those with a non-adhesive flap must be taped closed. Use bags that are BHT free. It is your responsibility to ask this of your bag supplier. Bags containing BHT (Butylayted Hydroxyloluene) can cause yellowing of the product. Should this occur you will be charged-back all applicable charges.

Do not use Styrofoam beads or other loose fill as packing material.

Item Packaging:

Apparel

We require that all apparel be packaged in folded, flat-pack form in polybags that are taped or heat-sealed. Merchandise must be folded to fit snug in the polybag so that it does not “puddle” and end up crumpled and wrinkled. Some items may require folding around a cardboard stiffener or tissue.

Merchandise must be folded neatly (pressed if necessary to remove wrinkles) to a size of pleasing proportions. The size of the finished package must fit appropriately in the carton size specified (see Shipping Carton Requirements).

Merchandise may be sent on hangers, only if the Merchandising Department gives prior approval. Merchandise on hangers must be covered with garment bags that are closed at the bottom or hang at least 6” below the product.

Adult swimsuits must have hygienic liners applied before shipping to Garnet Hill.

Package in a shoebox with item labels on one end of the box in the lower left corner. Pack master cases in solid case packs whenever possible, not doing so may result in charge backs.

Bedding

Sheets: Package in polybags or shrink-wrap Blankets and Quilts: Package in vinyl zip storage bags Pillows: Package in polybags

28 Rugs

Most rugs must be rolled and packaged in plastic that is closed at both ends with zip ties or metal wraps. Small rugs (2’x3’ or smaller) may be packaged flat in a plastic bag with one rug per bag. The bags must be durable enough for shipping. Please include an extra bag in the center of the roll for the ease of customer returns.

Jewelry

Jewelry must be individually bagged with any dunnage needed to protect during shipping. Each SKU must be in a master bag with the SKU label on the outside of the bag. Watches should be individually boxed and then placed in a polybag.

Accessories

These items must be individually bagged to protect the item and ready for Garnet Hill to ship to our customer.

Ceramics, Glass items

Ceramic items or anything in a glass or breakable container must be boxed and packed with protective packing material. Mark case appropriately when fragile merchandise is enclosed.

Personal Care Items (liquids/lotions in bottles or tubes)

All liquid products must be in containers with lids that have a leak proof seal. These products must be individually boxed, sealed in a bubble bag or bubble wrap, and packed ready for us to reship to our customer.

Games must be individually packaged and protected to secure all individual parts and protected during shipping.

Furniture

Furniture that is shipped to the Garnet Hill Distribution Center must be individually boxed, packed with protective packing and ready for Garnet Hill to ship to our customer.

Lamps must be individually boxed, packed with protective packing and ready for Garnet Hill to ship to our customer.

29 Item Labels

All individual item packaging must contain an item label with the Garnet Hill item/color/size as listed on the purchase order.

The item labels can be created using standard “Avery” (1” X 2.5”) address labels that can be purchased from an office supply store. Microsoft Word has address label templates that can be used to create them – a minimum 12 pt universal font is required. The labels are critical because they identify the item once it has been put-away at the warehouse.

Example of an item label:

4523 GREN TWFL

Location of Item Labels on Packaging:

Polybags – Place the item label on the front of the packaging, in the lower, left corner.

Boxes – Place the item label on the face of the box in the lower left corner.

30 GARNET HILL HARD GOODS/ FURNITURE PACKAGING PROTOCOL

Since we ship direct to customers our packaging standards need to exceed those you may use for shipping pallet loads to retail channels. We will be shipping individual cartons to our customers via motor freight or small parcel carrier exactly as they are received from you. Your master carton and individual re-shipper packaging must comply with ISTA packaging standards so that the product will arrive at our DC intact and then the individual re- shipper packaging will protect the product through handling and re-shipping to our customers.

RE-SHIPPER PACKAGE GUIDELINES Box Size  The box needs to be sized so the item and packaging/cushioning is snug inside the box with no movement. Box Strength  For items over 60 lbs and 85” girth, we require that the box be brown corrugated of 200# Double Walled material at a minimum.  Double Walled Corrugated is two corrugated mediums with a linerboard facing adhered between them and to both sides.

Cushioning the Item  A 2” thick cushion on all sides of the product is the benchmark to use for sufficient cushioning.  The cushioning needs to protect all 6 sides of the product from the side of the box in an effort to “float” the item centered in the re-shipper box.  A pre-formed polystyrene mold is excellent cushioning.

31 GARNET HILL HARD GOODS/ FURNITURE PACKAGING PROTOCOL

PACKAGING REQUIREMENTS  Test your re-shipper packaging to the Package Testing Requirements enclosed, make any necessary changes needed to pass this test.

 If the product weight is greater than 40 lbs or the dimensional girth (length+width+height) is greater than 56 inches, we require that you test your re- shipper packaging to ISTA 1A or 1B at a testing lab (Bureau Veritas/SGS) and submit passing test results to Garnet Hill before the product will be approved to ship to Garnet Hill customers.

 If the product weight is less than 40 lb and 56 inches dimensional girth;, send a packaged sample to: Garnet Hill, 231 Main St, Franconia, NH 03580 ATTN: Quality. Garnet Hill staff will test it to the drop test enclosed. They will contact you with packaging approval or with information about upgrading the packaging. Your packaging must pass this test before it will be approved to ship to Garnet Hill customers.

Internal Components  Internal components must be separated from each other with cushioning. No two components should touch in the box.  The items must be enclosed in a plastic bag to protect the finish.

Small Parts and Tools  Small parts and tools must be packaged in a sealed poly bag.  The package must be easy to locate, unable to move around the box and packaged so it does not harm the product.

Instruction Sheets  Instructions written in English must be enclosed is any part must be assembled by the customer.  Instructions must include: A parts list with quantity and identifying picture. And a list of all tools needed but not supplied.  Each step of assembly must be numbered and listed in order and include a picture of the action with the parts identified.  The last step must include a picture of the assembled item.

32 GARNET HILL: PACKAGE TESTING REQUIREMENTS: HARD GOODS  All packaging for Hard Goods items must be Package Tested to insure that our customers will receive merchandise undamaged.  Use this test to test and re-work your packaging before you send it for lab transit testing.  BOTH THE MASTER SHIPPING CARTON AND THE INDIVIDUAL INNER CARTONS MUST MEET THIS REQUIREMENT.

TEST METHOD: 1. All items with weight less than 150 lbs and Girth less than 165 inches will be dropped from a height of 30 inches. The item will be dropped a total of 14 times using the drop techniques below: (Girth =Longest side + (2 X (next longest side + smallest side))  Item is dropped on the manufactured corner bottom, the direct opposite top corner and the three seams leading away from those corners.  Item is dropped on the top, bottom and all four sides.

2. All items with weight more than 150lbs and Girth more than 165 inches will be dropped from a height of 24 inches. The item will be dropped a total of 10 times using the drop techniques below.

 Item is dropped on the manufactured corner bottom and the three seams leading away from those corners.

 Item is dropped on the top, bottom and all four sides.

Drop from 24 inches at bottom corner from manufactured edge and three seams leading away from corners.

3. All items with weight more than 150lbs and girth more than 165 inches will be dropped from a height of 24 inches. The item will be dropped a total of 10 times using the drop techniques below.

 Item is dropped on the manufactured corner bottom and the three seams leading away from those corners.  Item is dropped on the top, bottom and all four sides. 33 Certificate of Conformity Consumer Product Safety Improvement Act of 2008 Section 14(g) of the Consumer Product Safety Act, 15 U.S.C. § 2063(g) requires manufacturers, importers, and private labelers (foreign & domestic) to certify that all products manufactured on or after November 12, 2008, are compliant with all applicable standards, rules, and bans enforced by the CPSC. Compliance shall be evidence by a declaration or certificate of conformity. This certificate is not required to be signed; issuance of the certificate satisfies the requirements of the Consumer Product Safety Act. This certification MUST be provided in English and based on a test of each product or a reasonable testing program.

Item 1: Identification of the product covered by this certificate. Product Description Garnett Hill Item No. Vendor Item No. Container No. Garnett Hill Purchase Order Item 2: Citation to each CPSC product safety regulation to which this product is being certified. PLEASE PLACE AN “X” IN THE APPROPRIATE BOX and Include the SPECIFIC section(s) of the acts where compliance is being declared and note any claimed exemptions to the acts here as well Federal Hazardous Substances Consumer Product Safety Act Flammable Fabrics Act Act CPSA FHSA FFA Section(s) Section(s) Section(s) Children’s Gasoline Burn Prevention Poison Prevention Packaging Act Refrigerator Safety Act Act PPPA RSA CGBPA Section(s) Section(s) Section(s) Virginia Graham Baker Pool and Spa Not subject to any CPSC Standards, Bans, Rules or Regulations Safety Act VGBPSS A Section(s) ATTENTION: IF THE ITEM IS SUBJECT TO ANY OF THE ABOVE LISTED ACTS, THE BELOW INFORMATION MUST BE COMPLETED Item 3: Identification of the US importer or domestic manufacturer certifying compliance of the product: Name Full Mailing Address Phone # Item 4: Contact information for the individual maintaining records of test results: Name

Full Mailing Address Phone # Email address Item 5: Date and place where this product was manufactured: Date(s) of Manufacture (MM/YYYY) Full Mailing Address including street, city, country Item 6: Date and place where this product was tested for compliance with the regulation(s) cited above. Date(s) of Testing (MM/YYYY) Testing Location including city, country or administrative region Item 9: Identification of any third-party laboratory on whose testing the certificate depends. Laboratory Name Laboratory Full Mailing Address Laboratory Phone #

34 General Instructions for completing the Certificate of Conformity

Item 1: Describe the product covered by this certification in enough detail to match the certificate to each product it covers and no others. Item 2: The certificate must identify separately each applicable rule, ban, standard or regulation under the Acts administered by the Commission that is applicable to the product. The section reference should be identified in the text field, as well as any “exemptions” to the regulation being claimed.

Act Title Section References (for illustrative purposes only, may not be an exhaustive list) Consumer Product Safety Act 16CFR1201 – Architectural Glazing Materials (CPSA) 16CFR1202 – Matchbooks 16CFR1203 – Bicycle Helmets 16CFR1204 – Antennas 16CFR1205 – Lawnmowers 16CFR1207 – Swimming Pool Slides 16CFR1209 – Interim Standard for Cellulose Insulation 16CFR1210 – Cigarette Lighters 16CFR1211 – Garage Door Openers 16CFR1212 – Multi-purpose Lighters 16CFR1213 – Entrapment in Bunk Beds 16CFR1301 – Refuse Bins 16CFR1302 – Flammable Contact Adhesives 16CFR1303 – Lead-Containing Paint 16CFR1304 – Consumer Patching Compounds 16CFR1305 – Artificial Emberizing Materials 16CFR1306 – Lawn Darts 16CFR1401 – Self-Pressurized Consumer Products 16CFR1402 – CB Base Station/TV Antennas 16CFR1404 – Cellulose Insulation 16CFR1406 – Coal and Wood Burning Appliances Federal Hazardous 16CFR1500 – Hazardous Substances / Toys and Other Articles Intended for Use by Children Substances Act (FHSA) 16CFR1501 – Small Parts (Children <3 years) 16CFR1505 – Electrically Operated Toys and Other Electrically Operated Articles Intended for Use by Children 16CFR1507 – Fireworks Devices 16CFR1508/1509 – Baby Cribs 16CFR1510 – Rattles 16CFR1511 – Pacifiers 16CFR1512 – Bicycles 16CFR1513 – Bunk Beds Flammable Fabrics Act (FFA) 16CFR1610 – Clothing Textiles / Wearing Apparel 16CFR1611 – Vinyl Plastic Film 16CFR1615/1616 – Children’s Sleepwear 16CFR1630/1631 – Carpets and Rugs 16CFR1632 – Mattresses and Mattress Pads Poison Prevention Packaging 16CFR1700 Act (PPPA) Refrigerator Safety Act (RSA) 16CFR1750 Item 3: Provide the name, full mailing address, and telephone number of the domestic manufacturer or US importer of the product. Item 4: Provide the name, full mailing address, e-mail address and telephone number of the person maintaining test records in support of the certification. Item 5: Provide the date(s) when the product was manufactured by at least month and year. For the place of manufacture, if different from the manufacturer’s address in item 3, provide at least the city and country or administrative region, of the place where the product was finally manufactured or assembled. If the same manufacturer operates more than one location in the same city, provide the street address of the factory. Item 6: Provide the date(s) of the tests or test report(s) on which certification is being based and the location(s) of the testing. Item 7: If a third-party laboratory tested the product or conducted a testing program on which the certification is based, provide the name, full mailing address and telephone number of the laboratory.

35 SHIPPING REQUIREMENTS

Charge Backs for Non-Compliance

Warehouse non-compliance: Our warehouse is highly automated and requires UCC-128 labels and ASN’s from all vendors. The ASN needs to be in our computer system when the shipment arrives. The cases are loaded on a conveyor and the barcode from the UCC-128 label is scanned. The number associated with the scanned label is matched with the data on the ASN and received into the warehouse. Any interruption in this process requires someone to correct it. Ultimately the vendor will be issued a chargeback for the time and money it cost to correct the non-compliance.

Charge backs are $400 per non-compliance per purchase order. If the vendor is still non-compliant after three shipments, the chargeback increases to $1500 per non-compliance per purchase order.

Following is a list of non-compliance reasons and as you will notice most of them relate to ASN’s and UCC- 128 labels:

ASN INCORRECT FORMAT ASN NOT COMPLETE AND ACCURATE ASN NOT ON TIME BAD INVALID EDI DATA CASE LABEL NOT IN PROPER LOCATION-UCC CASE LABEL NOT PER CODE-UCC CONVEYABLE CARTONS W/BANDING MIN CASE MARKINGS NOT PRESENT-UCC MULTI-SKU CASES POOR CASE PACKAGING RUG COMPLIANCE SKU LABELING ITEM UCC-128 LABEL NOT SCANNABLE UCC-128 NOT PRESENT

Late purchase order and Drop Ship non-compliance: Late purchase orders also incur chargebacks at a percentage of the total cost, for example:

5% of the cost for a shipment 1 week late 8% for a shipment 2 weeks late 15% of the cost for a shipment three weeks late

** This applies to Drop Ship orders as well.

Transportation non-compliance: When Garnet Hill is paying for any portion of a shipment’s freight, the carrier selected must be determined using our current Routing Guide. Wrong carrier selection will result in a chargeback for the full amount of the freight.

Domestic Shipping Approval Non-Compliance: Failure to obtain approval prior to shipping will result in non- compliance chargeback fees and could lead to refusal of goods.

Vendor Non-Compliance chargebacks (debit memos) are sent via email to our vendor PO contact. Whenever appropriate the warehouse will take pictures to show the problem – these will be included in the debit memo and can be sized by right-clicking. The Garnet Hill finance department will deduct the debit amount from the vendor’s next invoice payment. Other arrangements will be made with “Letter of Credit” or “Wire” payment vendors.

Our goal is to have ZERO non-compliance issues. Please contact the Vendor Relations Coordinator at (603)823-5545 or [email protected] if you are unsure about a situation.

37 Garnet Hill Vendor Shipping Checklist

 Package individual item and apply Garnet Hill item label as specified.  Choose the carrier using the current routing guide: http://www.ccsginc.com/garnet.htm  Complete the UCC-128 case label(s) as instructed and affix in the proper location on the case.  Complete and save the ASN (Advanced Shipment Notification) with the data from the UCC-128 label http://www.ccsginc.com/garnet.htm.  Email the ASN to [email protected] and [email protected].  Place packing list inside and outside the lead case (you can print the ASN and use it as a packing list).  Call or email the Garnet Hill contact on your purchase order for shipping approval.

Packing List

A packing list must be inside the lead case as well as attached to the outside of the lead case. Vendors can use a printed copy of the ASN as a packing list.

Routing Guide & Transportation

All shipments must follow the most current routing guides which are found on www.ccsginc.com - click on the Garnet Hill – Vendor Partnership link. You will find both Domestic and International routing guides on this site. Check this site often as updates are regularly made to the routing guide.

Bill of Lading

Case count and purchase-order numbers must be printed on the Bill of Lading. If multiple POs are shipped on one BOL, then the total cases across all ASNs must match the total cases on the BOL. Vendors must consolidate same day shipments onto one bill of lading. A BOL is not necessary when shipping UPS.

Bill to Address:

Garnet Hill Inc PO Box 1729 West Chester OH 45071-1729 Or Email to: [email protected]

Purchase Order Confirmation

38 Purchase orders must be reviewed for accuracy and confirmed by you, the vendor, within three business days from the date of receipt. This is including, but not limited to, the correct ship date, quantity, cost and terms. Unconfirmed purchase orders are subject to revisions and/or cancellation.

39 Garnet Hill Invoicing Requirements for Inventory Vendors 11/17/10 Garnet Hill has a different set of invoicing instructions for different types of payment terms: Vendors with conventional terms: An acceptable invoice will need to include the vendor name and address, contact information, an invoice number, invoice date and the appropriate purchase order number. Each invoice must be for (1) purchase order only and show detail down to the SKU level or be accompanied by a packing slip with this detail. All invoices must be submitted directly to Garnet Hill’s corporate office either by email at garnet- [email protected] or by mail to: Garnet Hill Inc, PO Box 1729, West Chester, OH 45071-1729. Please do not send invoices to the Franconia, NH address.

Vendors with prepaid terms (International vendors paid prior to receipt of inventory): An acceptable invoice will need to include the vendor name, address and other contact information, invoice number, invoice date and the appropriate purchase order number. Each invoice must be for (1) purchase order only, show detail down to the SKU level or be accompanied by a packing slip with this detail, and include the bill of lading or air way bill. Two sets of documents must be submitted: 1. The original documents (invoice, packing slip, bill of lading or air way bill) must be sent by courier to Garnet Hill Inc, Attn: Candace Foster, 231 Main St, Franconia, NH 03580. These original documents are needed at the Franconia site in case of a customs audit. 2. A second set (copies of the invoice, packing slip, bill of lading or air way bill) must be submitted directly to Garnet Hill’s corporate office either by email at [email protected] or by mail to: Garnet Hill Inc, PO Box 1729, West Chester, OH 45071-1729.

Letter of Credit vendors: An acceptable invoice will need to include the vendor name, address and other contact information, invoice number, invoice date and the appropriate purchase order number. Each invoice must be for (1) purchase order only, show detail down to the SKU level or be accompanied by a packing slip with this detail, include the bill of lading or air way bill, and the banking documents associated with the letter of credit. Two sets of documents must be submitted: 1. The original documents (invoice, packing slip, bill of lading or air way bill and banking documents) must be sent by courier to Garnet Hill Inc, Attn: Candace Foster, 231 Main St, Franconia, NH 03580. These original documents are needed at the Franconia site in case of a customs audit. 2. A second set (copies of the invoice, packing slip, bill of lading or air waybill, and banking documents) must be submitted directly to Garnet Hill’s corporate office either by email at [email protected] or by mail to: Garnet Hill Inc, PO Box 1729, West Chester, OH 45071-1729.

Please direct all AP inquiries to [email protected] or call 1-877-333-1049.

40 External Case Labeling (UCC-128 Labels)

 A unique 20 digit UCC-128 barcode case label is required on each case in a shipment.  Vendors creating their own UCC labels must have them approved prior to the first shipment. Email a copy of your completed label to [email protected]. Typical label size is 6”H x 4”W and a minimum 10 pt universal font is required.  All information on the label below is required.  The data needed to fill out most of the label will be on the purchase order you receive.

Ship From (vendor address) Vendor # Ship To Carrier Info (at time of shipping) Purchase Order # Garnet Hill Item # Vendor Item # (optional) Size (Garnet Hill) Color (Garnet Hill) Desc.(Garnet Hill) Case # of (determined at time of packing) Qty in Case (determined at time of packing)

 The unique 20 digit case number along with the label data must be entered in the Advance Shipment Notification (ASN) which must be created prior to shipping.

Sample UCC-128 Label:

41 UCC-128 Case Label - Specific Characteristics

Explanation of Symbology

1 2 3 1) Vendor’s UCC Number (or UPC preceded by a zero)

(00) 0 0012345 555555555 8 2) Unique carton identification number (nine digits)

3) Check digit (mathematical formula)

*The Uniform Code Council has approved a standard format for UCC-128 case labels. Vendors can find this information by visiting www.uc-council.org.

UCC-128 Case Labels must have this bar code Symbology:

1. The bar code must meet the following specifications:  UCC Code 128, subset ‘C’  20 Digits – encoded, numeric  Minimum narrow element: .02”  Wide element: 1.0”  Minimum bar code height: 1.0”  Maximum pattern length: 3.12”  Overall pattern length: 3.52” (including ‘quiet’ zones)

ANSI A or B print quality (ANSI X#.182) and smudge proof ink are required. If tape is applied over the label, it must be a low reflective tape (tape is not recommended).

Vendors can purchase software packages in order to produce their own UCC-128 labels or make arrangements to have the labels pre-printed for them.

42 Garnet Hill UCC-128 Recommended Source

Adaptive Data Interchange is not affiliated with Garnet Hill in any way. Many of Garnet Hill vendors use this company to create their UCC-128 case labels. They are a reliable, inexpensive source that guarantees 100% accuracy of UCC-128 labels.

When contacting ADI, simply let them know that you are a Garnet Hill vendor and they will lead you quickly through the process of ordering UCC labels. ADI knows the correct format to apply to labels for Garnet Hill vendors.

Jerry Gribler (937) 436-2343 Email: [email protected] www.adi-barcode.com

43 Case Size Requirements

CASES MUST CONTAIN ONLY ONE SKU (ITEM/COLOR/SIZE) WHENEVER POSSIBLE Multiple purchase orders should never be mixed a case.

Multi-SKU cases: some of our purchase orders are for small items such as jewelry or personal care products and/or small quantities of multiple SKU’s. In these circumstances Garnet Hill may waive the multi- sku chargeback fees given an agreement with the vendor has been reached prior to shipping. This approval must be given by Vendor Compliance and is done so on an individual purchase order basis. The following packing guidelines must be followed:  Maximum of 7 SKU’s per master case.  Each SKU inside the master case must be individually boxed.  Label each inner box with an item label and mark the qty on the label. Minimum inner box size is 2”H x 4”L x 4”W  The UCC-128 label is required on each master case as specified throughout this manual – the only difference is that each SKU and quantity must be marked on or near the UCC-128 label – A label to the right of the UCC-128 label with the SKU information is acceptable. All other instructions throughout this manual apply to multi- SKU master cases. There is a section in the ASN creator instructions for “Entering Multi-SKU Cases”.

Cases must not exceed the size listed in this picture:

Maximum Height Maximum Length 26” 40”

*1) UCC-128 Case Label Maximum Width 26”

Master cases must never exceed a maximum weight of 50 lbs

Damage to our automated conveyor systems can be caused if cartons are banded, strapped, shrink wrapped or have string securing them. Please do not use any sort of carton banding, charge backs will occur if banding is used.

To prevent damage to our material handling equipment, do not secure individual cases with straps, bands, shrink wrap, staples, or string (except Ship Alone Items). Pallets can be strapped or shrink wrapped.

44 UCC-128 Case Label Placement

Case Label Placement for Conveyable and Non-Conveyable Cartons

How to Determine Conveyable vs. Non-Conveyable Products

Max Height Max Length 26” 40”

1) UCC-128 Label

Max Width 26”

Conveyable Cases – This diagram shows the maximum dimensions for conveyable cases. This is the largest case that can ride freely on our automated conveyor system.

Non-Conveyable Cases – If a case is larger then any of the dimensions listed above then the case is non-conveyable.

Conveyable Labeling Guidelines

 The UCC-128 Case Label must be placed on the smallest side of a case.  Find the smallest side by laying the case flat so that the height is the shortest it can be – disregard where the case opening is.  The UCC-128 label should be placed in the lower, left corner on this side of the case.  The label should be placed about one inch from the bottom and left side of the case.  If the label is bigger than the smallest side, place the bar code portion of the label in the lower left and fold the remainder of the label over the top of the case. Case labels must have a valid bar code that is scannable. Our warehouse’s scanner is located in the lower left hand area of the conveyor system. Please follow the guidelines above very carefully.

45 Non-Conveyable UCC Labeling

Label placement on non-conveyable cases must allow for quick and efficient hand scanning. All UCC-128 case labels must be placed, facing out, and only one label per case.

Labels must be placed on the smallest end of a case in the lower, left hand corner. This enables us to maximize space in our warehouse. Please see below for a correctly labeled pallet of non-conveyable cases.

UCC-128 Case UCC-128 Labels, Placed Case facing Labels

Non-Conveyable with Arrow Directions

Safe handling of merchandise is top priority at our warehouse and storage facility. Non- conveyable cases with arrow directions (“this side up”, etc.) should have labels placed in a manner that corresponds to these directions.

The UCC-128 case label must be placed on the lower left hand corner of the case, corresponding to the arrow being in correct vertical position.

UCC-128 Case Label

46 CASE SEALING AND PALLETIZING A SHIPMENT

Taping and Sealing Cases

Due to the large number of cases received at the Distribution Center, standardized case sealing simplifies inventory and quality inspections. Taping must not hide any required case markings or labels. Sealing Technique for the Standard Case :

Garnet Hill requests that cardboard inserts be placed in the top and bottom of each case to protect merchandise when carton is opened.

Palletizing

1. The required pallet size is 48” long x 40” wide (1.22m long x 1m wide). 2. Maximum height of pallet 65” (1.65 meters) including cases and pallet. 3. Cartons on the pallet must not overhang pallet length or width. 4. Use Four-way pallets. 5. A pallet label with the following information, must be on all 4 sides of EACH pallet:  Ship to: Garnet Hill  Ship From: Vendor Name  Vendor Address  Garnet Hill PO #  PRO # 6. Place cases on pallet so all case labels face outward as shown below: 7. Cases of the same PO should be numbered “xx of xx” starting with “01 of xx”. **Please refer to page 43 for Rugs

Pallet labels On all 4 sides

Case labels Case labels

47 RUG PACKING AND LABELING

All rugs shipped to the warehouse must meet the following qualifications:

1. One SKU (color, size) per Gaylord case or pallet. Do not mix item numbers, sizes, and/or colors. 2. Each individual rug should be placed in durable plastic shipping bag with an item label at the bottom. (See section on item labeling for details.) One rug per plastic bag please. 3. Please include an extra bag for ease of customer returns. 4. Pallet should be accommodating to the length of the rugs; no part of the rug should touch the ground.

5. Small (2’x3’ or smaller) and medium rugs (48”or less; with packaging) should be individually wrapped in plastic, and then placed inside a master Gaylord case.

6. Large rugs must be stretch wrapped or banded to a pallet to prevent shifting during transport. Banded is the preferred method

7. Each pallet must have a printed UCC-128 case label placed on the outside of the pallet’s wrapping or the Gaylord case, in clear view. Please see the section on UCC-128 case labels for details.

8. One purchase order per shipment.

9. Most rugs must be rolled and packaged in plastic that is closed at both ends with zip ties or metal wraps. The bags must be durable enough for shipping. Example of a stretch wrapped skid secured to a standard sized pallet.

Pallet label placed on the outside, in the bottom left hand corner. Example of large rug packaging

48 Doormats

Doormats should be sent by pallet. Each rug must be individually bagged, securely sealed with tape and have an item label affixed to the bag. Stack rugs securely on a pallet built to closely match the size of the rugs; i.e. no overhang (pallet to small), wasted space (pallet to large). Rugs should be stacked one on top of the other. Do not exceed 65 inches in height. Rugs must be banded and stretch wrapped to the pallet with a UCC label affixed to the lower left corner. Do not pack more than 1 SKU on a pallet.

Palletizing Rugs

Palletization with or without use of Gaylord boxes is required of rug shipments. Failure to comply with this requirement will result in a charge back. Large volumes of rugs are difficult to move due to their awkward size and shape. The following guidelines should be closely followed to avoid unnecessary damage, ONE SKU per pallet.

1. The required pallet size is 48” long x 40” wide (1.22m long x 1m wide). 2. Maximum height of pallet 65” (1.65 meters) including cases and pallet. 3. Cartons on the pallet must not overhang pallet length or width. 4. Use Four-way pallets. 5. A pallet label with the following information, must be on all 4 sides of EACH pallet:  Ship to: Garnet Hill  Ship From: Vendor Name  Vendor Address  Garnet Hill PO #  PRO # 6. Place rugs on pallet so all labels face outward as shown below:

**If possible, transport rugs in Gaylord boxes. ( see example of a Gaylord box below) This offers the best protection and makes it easy to unload and move the rugs.

Pallet

UCC-128 Case Label in lower, left corner of gaylord box.

49 Advanced Shipment Notification (ASN)

 Garnet Hill requires a specific format for the ASN. Please go to www.ccsginc.com and click on the Garnet Hill – Vendor Partnership link.

ASN Creator Instructions  This is a step by step set of instructions on how to correctly complete the ASN Creator. English - ASN Creator  The ASN form should be downloaded to your desktop each time an ASN is created to avoid form errors. This is a Microsoft Excel spreadsheet and you will save it as an .xls file. Please include your purchase order number as part of the file name.  Attach the .xls file to an email and send it prior to scheduling the shipment with the carrier to both [email protected] and [email protected]. You will receive confirmation the ASN has been received. If you do not receive confirmation resend the ASN.  Please become familiar with the ASN Creator Instructions and English-ASN Creator prior to the day of shipping. The ASN and UCC-128 labels are key to avoiding charge backs.  The ASN must be sent prior to scheduling the shipment to be picked up by the carrier.

VendorNet

 VendorNet is a web based application that enables a user to receive purchase orders, print out UCC- 128 case labels, send an ASN and invoice an order over the internet. There is no cost to the vendor to take advantage of this easy to use program.  If you wish to be considered for VendorNet set-up, please contact our Vendor Relations Coordinator at [email protected].

50 Import Requirements

The U.S. Customs Service requires entries pay all duties and taxed applicable to the U.S. government at the time of importation. Duties are assessed when an importing carrier arrives at the port of entry. U.S. Customs requires specific documentation to secure the release of merchandise. This documentation must be provided within five days of a carrier arriving at a port of entry. The required documents to provide U.S. Customs are:

1. Original Bill of Lading (BOL), carrier’s certificate or airway bill properly consigned. 2. Signed commercial invoice and packing list. 3. Declare the value of merchandise in U.S. dollars. 4. Other costs of merchandise (freight, insurance, etc.). 5. The quantity for each SKU in a shipment. 6. The total weight in kilograms. 7. Textile information (fiber content as stated on invoice), also state if knit, knapped, ornamented, etc. 8. The Importer Security Filing (ISF) Interim Final Rule was published in the Federal Register on November 25, 2008. Effective date: January 26, 2009. Import Responsibility: Importers will need to provide Customs and Border Protection with ten data elements 24 hours prior to lading aboard a U.S.-bound vessel. Data Elements:  The Seller  the Buyer  Importer of record number  Consignee number  Manufacturer (or supplier)  Ship to party  Country of origin  Commodity HTSUS number  Container stuffing location and the Consolidator (stuffer). Your freight forwarder is fully aware of these requirements and can help you with any questions or concerns.

Additional Requirements for Import Vendors

In addition to all other Garnet Hill labeling requirements stated in this manual, U.S. Customs will require:

1. Case Labeling: Country of Origin must be clearly marked on each case in a shipment. This can be a supplemental label or directly on a case. 2. Item Labeling: Each imported item must be clearly marked with the Country of Origin and fiber content (if applicable) and must appear in English. Textiles will have this information on sewn in labels and hard good on supplemental, secure labels. 3. Packing Slips must be ON and IN the lead case for every purchase order being shipped. (Cases should be numbered xx of xx, starting with 01 of xx for each P.O., 1 being the lead case) 4. Bill of Lading (BOL) and PRO# are supplied by the import vendor’s freight forwarder. 5. The carrier for an import vendor IS their freight forwarder. 6. Cases must meet the following dimensions:  Minimum case weight is 2lbs. (.9kg)  Maximum case weight is 50lbs. (22.7kg)

51 Commercial Invoice Requirements

All information on the commercial invoice MUST be in English Data Element: Comments: This should be the name and address of the foreign Shipper or Manufacturer's Full Name and Address shipper, NOT a US company. This should be the name that your company is incorporated under, not CCSG or your catalog name Consignee's Full Name and Address (i.e. - not Garnet Hill, IOS, etc.). Invoice Number and Date If the shipment is a sample, state "Sample" and the Brand Purchase Order Number(s) person at the brand who purchased the sample. Brand Item Numbers Not applicable for sample shipments. All item numbers should include the gender (Women's, Gender Men's, Girl's, Boy's Unisex). This should include the name of the item, what the item is, what it is made out of and its intended use. Textiles/wearing apparel may also require additional information. If the item is packaged as a set, state that Complete Description of the Goods as well. This should be the total number of pieces shipped Total Quantity Shipped and Unit of Measure listed in pieces, sets, etc. Must list unit price of each item on the invoice. This MUST be the true price of the item regardless of whether it's being supplied free of charge (normally Unit Price seen on samples). Total price calculated by multiplying units shipped by Total Price unit price. State the currency used in alpha characters- USD, EUR, etc. Symbols for these currencies are not Currency Used sufficient. State "Made in:" and include the country where the item was manufactured. Please note that "EU" is not Country of Origin acceptable, must state the actual country. Also sometimes called payment terms, this should be the point where the buyer takes possession of the cargo (i.e. Ex-factory, FOB Hong Kong, etc.) For FOB points, must state the actual city where possession changes, FOB China or FOB port is incorrect but FOB Inco Terms Shanghai would be acceptable. This should be the total of all items listed on the invoice. This MUST reflect the true cost of the items regardless of whether they are being supplied free of Total Invoice Amount and Currency charge. Actual Manufacturer's Full Name and Address or Manufacturer ID Code This is a requirement for all textiles only.

52 Additional Notes:

 All samples MUST have the TRUE value assigned regardless of whether they are being supplied free of charge.  Commercial invoices should be accompanied by packing lists that list the appropriate carton counts and weights.  Additional documentation such as certificates of origin, fumigation certificates, etc. may also be required depending on the commodity and country of origin.  Different commodities, such as wearing apparel, may require more detailed item descriptions, see below for the requirements for some common items that we import:

− Wearing apparel - see below − Mirrors - must list the total reflecting area per item in centimeters squared − Rugs and mats - must list the total meters squared per item − Sheets - must state whether or not the sheets are printed, napped or contain any embroidery, lace, braid, edging, trimming, piping or appliqué work − Quilts - must state whether the quilt contains any embroidery, lace, braid, trimming, piping exceeding 6.35 mm or appliqué work − Shams - must state whether or not the shams are quilted

Wearing Apparel Detail Sheet Instructions: * Complete Section A for all garments. * Answer remaining sections that are specific to the item being imported. Example: Section B is for shirts, sweaters, etc.

A. Identify: (this should be completed for all types of garments) 1. Name of garment: ______2. Importer style/item #: ______3. Contains embroidery or appliqué?: YES_____ NO______4. Identify gender or wearer: Men's ______Boys (sz 2T-4T, 4-7, 8-20) ______Women's ______Girls (sz 2T-4T, 3-6x, 7-16, 10.5-16.5) ______Infants ( sz 0-24 months) ______5. List size ranges ______6. Identify fiber content/material breakdown in generic terms in percentage by weight ______For garments that are composed of textile and non-textile (ex: leather and fabric) please identify the following: a. Identify percentage of component by weight ______b. Identify percentage of component by value ______c. Identify percentage of component by surface area ______7. Identify construction: KNIT______WOVEN______8. Does the garment have any of the following features? If yes, list fiber content and location:

53 Wearing Apparel Detail Sheet Instructions: a. Lining ______b. Interlining ______c. Trim ______9. Does item contain buttons? YES_____ NO______If yes, list complete content breakdown ______

B. Shirts/blouses, pullovers, tank tops, tops, sweatshirts, sweaters and t-shirts: 1. Does the garment have pockets below the waist? YES_____ NO______2. Does the garment have an opening at the neck? YES_____ NO______a. If yes, describe type: FULL___ PARTIAL___ NONE____ b. If full or partial opening, does garment: Button left over right YES_____ NO______Button right over left YES_____ NO______c. Describe location of neck opening: Front___ Back___ Side______d. Method of fastening: Button______Zipper______Tie______Other (describe)______3. What type of bottom: Ribbed (sewn on: or continuous knit ) Hemmed______Drawstring ______Other (describe)______4. What type of sleeves: Long______Short______Straps______Width of straps ______5. What type of cuff on sleeves: Hemmed______Ribbed______Other (describe)______6. If garment is a top: a. does top meet the waist? YES_____ NO______b. give length of top in inches ______inches 7. If garment is a t-shirt: a. Is garment to be used as underwear? YES_____ NO______b. Is the garment white? YES_____ NO______c. Is garment over 200 grams per square meter? YES_____ NO______8. If the garment is a sweatshirt: YES_____ NO______Is it napped (fleece)? YES_____ NO______9. For all KNIT garments in Section B, complete the following: Number of stitches per centimeter: Vertical:______Horizontal:______10. On all WOVEN garments in Section B, complete the following: Does garment contain 2 or more colors in the warp or filling? YES_____ NO______

54 Wearing Apparel Detail Sheet Instructions: C. Coats, jackets, windbreakers: 1. Is the garment a suit type? YES_____ NO______2. Give length of garment ______inches 3. Give number of panels ______panels 4. If water resistant, please complete the following: a. Describe application: Rubber_____ Plastic_____ b. Where is application applied? Outer shell__ Lining__ Interlining c. Does garment pass the ASTM D3600-81 and D3781-89 (under a head pressure of 600 millimeters, not more than 1.0 gram of water penetrates after 2 minutes) tested in accordance with AATCC Test method 35-1985? (if yes, include test certificate) YES_____ NO______5. If item is down-filled apparel, please complete the following: a. What is the total weight of the garment? ______b. What is the total weight of the feathers? ______c. What is the total weight of the down? ______

D. Ensemble suits (MUST be imported together and cover the lower and top portion of the body) 1. Is the fabric design of the top identical in color and construction to the fabric and design for the bottom portion? YES_____ NO______2. Does the item have trim? YES_____ NO______a. If the item as trim, describe the location of the trim on the: Upper garment ______Lower garment ______3. Give the number of panels in the vertical direction ______panels

E. Scarves and Shawls Please give dimensions ______

F. Men and Boy’s Swimwear 1. Does the garment have: a. Liner YES_____ NO______b. Is liner full or partial Full______Partial______2. Describe waistband: Elasticized?_____ Functional Drawstring?______Other (describe)

G. Dresses, night dresses, night shirts and pajamas 1. Does the garment have 2 or more colors in the warp and filling? YES_____ NO______

55 H. Coated and Impregnated Apparel 1. What is the garment coated with: Rubber?___ Chemical Name:______Plastic?____Chemical Name:______2. List the depth of coating in millimeters ______mm 3. Describe area of garment that is coated: Outer shell___ Lining____ Interlining____ Other (describe)

I. Bib or Brace Overalls, Coveralls: 1. If garment has a bib rise, give the height in inches of the rise above the natural waistline: ______inches 2. If the garment is water resistant, fill out the following: a. What is the type of application? Rubber_____ Plastic_____ b. Does garment pass the ASTM D3600-81 and D3781-89 tested in accordance with AATCC Test method 35-1985? YES_____ NO______c. Describe area of garment that is coated: Outer Shell____ Interlining____ Lining______

Company Name:______Authorized signature of vendor/seller:______Typed or printed name:______Date:______

56 ISF Elements: Additional ISF Party Information Form

This is the Additional ISF Party Information form for parties that are not supplied on the main ISF Data Elements form. It must be completed in English and submitted to Freight Forwarder with the ISF Data Elements form no later than 96 hours prior to the shipment loading on the vessel at origin.

ISF Party Types: Manufacturer/Supplier, Seller, Buyer, Ship-to, Consolidator, Container Stuffing Location

Seller: Name: Address Line 1: Address Line 2:

City, State & Postal Code or City and Country:

Buyer: Name: Address Line 1: Address Line 2:

Ship-to: Name: Address Line 1: Address Line 2:

Consoldiator: Name: Address Line 1: Address Line 2:

Container Stuffing Location: Name: Address Line 1: Address Line 2:

57 ISF Elements: Additional ISF Product Detail Information Form

This is the Additional ISF Party Information form for parties that are not supplied on the main ISF Data Elements form. It must be completed in English and submitted to Freight Forwarder with the ISF Data Elements form no later than 96 hours prior to the shipment loading on the vessel at origin. ** A 10 digit Harmonized Tariff Number is preferred.

Product Detail Information: Product/Item Number HTS Number** Country of Origin Manufacturer Name and Address