Standard Terms and Conditions

These Standard Terms and Conditions (these “Terms”) shall apply to the transaction (the “Transaction”) for the purchase of goods (the “Goods”) or the outsourcing of services (the “Services”) as described in the purchase order (the “Purchase Order”) issued by Fast Retailing USA, Inc., or a direct or indirect subsidiary of Fast Retailing USA, Inc., including, but not limited to Theory LLC or Helmut Lang New York LLC (collectively the “Company”) and received by you (“Contractor”).

Article 1 (Application of Terms and Contract Formation)

1.       These terms shall not apply where the parties have executed a separate, signed agreement that provides the terms for the Transaction (“Separate Agreement”). In this case, the Separate Agreement supersedes these Terms, and the contents and descriptions of the Goods or the Services contained in the Purchase Order shall form an individual contract pursuant to the terms of the Separate Agreement.

2.       In the event of a question or objection with regards to the order contents written on the Purchase Order, Contractor shall notify the Company in writing within five (5) business days of receiving the Purchase Order.

3.       At the earlier of the following, Contractor shall be deemed to have accepted these Terms, and a contract shall be formed with the provisions of the Purchase Order and these Terms as its contents:

(1)     Upon shipping of the Goods or commencing the Services, pursuant to the Purchase Order; or

(2)     Upon Contractor issuing an order acceptance form.

Article 2 (Issuance and Contents of Purchase Order)

1.       The Company shall conduct the following by way of a Purchase Order:

a.       When the contents of the order are for a purchase of Goods: request to purchase the Goods pursuant to the contents described in the Purchase Order.

b.       When the contents of the order are for the outsourcing of Services: request to engage Contractor to perform the Services pursuant to the contents described in the Purchase Order.

2.       The following items may be included within the Purchase Order:

a.       The issue date of the Purchase Order;

b.       When the contents of the order are for a purchase of Goods: the order item, specification, quantity, unit price, amount, delivery date, and, at the Company’s option, shipping instructions (including, but not limited to, packing methods and place of delivery), inspection and other acceptance conditions, deadline for completion of inspection, payment conditions (including payment dates and payment methods) and any other applicable terms for the Goods (collectively, the “Purchase Terms”);

c.        When the contents of the order are for outsourcing of Services: the content of the Services, performance schedule (date for completion of the Services or period of performance), the remuneration for the Services, payment conditions (including payment dates and payment methods), and any other applicable terms for the Services (collectively, the “Service Outsourcing Terms”).

Article 3 (Amendment of these Terms or Purchase Order)

1.       Company reserves the right at any time to amend these Terms by notice to the Contractor.

2.       Company reserves the right at any time to make changes to any Purchase Order, including, without limitation, changes to the method of shipment; labeling or packing; the time, place and manner of delivery; the specifications; or the quantity of Goods or types of Services. If any such change shall cause an increase or decrease in the cost or time required for performance of the Transaction, Contractor shall immediately advise Company of any such increase or decrease, and an equitable adjustment will potentially be made to the Purchase Order, including without limitation an adjustment to the Purchase Order price and/or delivery schedule. Any claim by Contractor for such adjustment, however, must be approved by Company in writing prior to such adjustment being made.

3.       Company may cancel any Purchase Order that is not shipped complete on the shipping date specified. Every order shall be automatically cancelled if not shipped by the cancellation date specified, unless such date has been modified and approved by Company. The only exception to this policy occurs for International Vendors who must ensure merchandise is in the possession of the Company’s forwarder /consolidator by the cancellation date.

Article 4 (Delivery of the Goods)

1.       Contractor shall deliver the Goods pursuant to the Purchase Terms.

2.       In the event that Contractor is unable to deliver all or a part of the prescribed quantity of the Goods by the delivery date, or there is a possibility of such situation occurring, Contractor shall immediately report the reason to the Company. Such notice to the Company, however, shall not relieve Contractor of any and all of its obligations, including Contractor’s obligation to deliver on time, and shall not impact Company’s rights hereunder.

3.       Every order shall be subject to cancellation and/or return of merchandise at the Contractor’s cost, if merchandise is found to be in violation of any federal or provincial act or regulation relating to contents and/or labeling.

4.       If an order is not shipped complete and lacking prior arrangements to ship incomplete, all shipping charges on second and/or subsequent shipments making up the complete order shall be fully prepaid by the Contractor, at Contractor’s sole expense.

5.       Contractor must contact the Company’s Production Dept. regarding any situation which may jeopardize the on time delivery of Goods.

6.       Company’s Production Dept. must have at least 2 months advance notice of factory vacation closings.

7.       Company’s Production Dept. must be advised of any changes to the following:

• Cost

• Vendor Style numbers

• Product descriptions

• Minimum shipping quantities (prepaid shipping terms will be met)

• UPC/EAN numbers

• Delivery Dates

8.       Substitutions are not allowed without written authorization from the Company’s Production Department.

Article 5 (Performance of the Services)

1.       Contractor shall perform and complete the Services in accordance with the Service Outsourcing Terms and other business process guidelines or directions separately provided by the Company.

2.       If deliverables are produced as a result of the Services (“Deliverables”), Contractor shall deliver the Deliverables to the Company pursuant to the terms of the Purchase Order.

3.       If there is a possibility of disruptions to the completion of the contents of the Services described on the Purchase Order or to the schedule for the performance of the Services, Contractor shall immediately report the reason to the Company. Such notice to the Company, however, shall not relieve Contractor of any and all of its obligations, including Contractor’s obligation to deliver on time, and shall not impact Company’s rights hereunder.

4.       If requested by the Company, Contractor shall, at any time, immediately, provide a report on the status of the Services to the Company.

5.       If the Purchase Order requires that all or part of the Services are to be performed by a specific person employed by Contractor, Contractor shall comply with such direction and shall not have another person employed by Contractor perform those Services, in whole or in part, without the prior written consent of the Company. In the event that the Services are being delegated to a specific person, Contractor shall bear all liability under these Terms with regards to that person.

Article 6 (Inspection, Acceptance and Transfer of Title and Risk)

1.       The Company shall, after delivery of the Goods or the Deliverables from Contractor, conduct an acceptance inspection and accept only those Goods or Deliverables that pass such inspection (“Acceptance”). The Company shall notify Contractor regarding any Goods or Deliverables that are non-conforming.

2.       In the event that any Goods or Deliverables are deemed non-conforming as a result of inspection, Contractor shall, at its own expense and responsibility, pick up the non-conforming Goods and/or take possession of the non-conforming Deliverables, and deliver replacements to the Company by the deadline separately specified by the Company, if the nature of the Goods or Deliverables allows for replacement delivery.

3.       In the event that the quantities of the Goods or Deliverables are deemed to be in excess of the ordered amount, Contractor shall, at its own expense and responsibility, pick up the excess amount by the deadline specified by the Company. Additionally, if the quantity, and/or quality of the Goods or Deliverables are deemed to be insufficient, Contractor shall immediately take corrective measures (such as additional delivery) in accordance with the directions of the Company.

4.       If the Company has issued additional directions with respect to situations provided under Clause 2 and 3 above, Contractor shall comply with such directions.

5.       Title and risk in the Goods or Deliverables shall transfer from Contractor to the Company upon completion of Acceptance.

Article 7 (Price for Goods and Remuneration or Expenses for Services)

1.       The Company shall pay to Contractor the price for the Goods or remuneration for Services specified in the Purchase Order pursuant to the payment terms therein.

2.       Contractor may only invoice the Company for expenses necessary for the performance of the Services where the Contractor has first obtained Company’s prior written consent for the specific expenses.

3.       The amount of Federal, State or local taxes applicable to the sale, use or transportation of the Goods sold or the Services performed hereunder and all duties, imposts, tariffs, or other similar levies shall be included in the prices and thus shall be paid by Contractor, except where Company shall otherwise agree in writing.

4.       Company shall receive the benefits of any decline in prices, up to the specified date of shipment. In addition, Contractor payments incorporating higher merchandise costs than those otherwise negotiated will be subject to a chargeback of the difference. Changes to the quoted order cost shall not be valid or binding unless formally approved in writing.

5.       Unless otherwise specified within the purchases order, all orders shall be FOB City of Origin of shipment.

Article 8 (Warranty)

Contractor warrants that the Goods or the Deliverables shall conform to the specifications required by the Company.

Article 9 (Defect Liability for Goods or Deliverables）

1.       For the period of one (1) year from the day following Acceptance (the “Warranty Period”), the Company may demand reimbursement from Contractor pursuant to Clause 2 below if the Goods or the Deliverables are found to have defects or other imperfections.

2.       The Company may demand compensation in the following cases, and Contractor shall comply with such demands.

(1)     Delivery of replacement products: the Company may, for no additional cost to the Company, demand the repair of defective or imperfect Goods or Deliverables (“Defective Items”) or the delivery of replacement Goods or new Deliverables.

(2)     Sorting expenses: the Company may invoice Contractor for expenses incurred in sorting Defective Items.

(3)     Other damages: if the Company has incurred damages attributable to defects in the Defective Items, Contractor shall be liable for such damages, in addition to its obligations under Items 1 and 2 above.

3.       In the event that Defective Items need to be returned, the costs of returning and replacing such Defective Items shall be borne by Contractor.

Article 10 (Product Liability)

Where a third party sustains damages, such as loss of life, bodily injury or property damage, due to defects or imperfections in the Goods or Deliverables that are attributable to Contractor, Contractor shall, at its own responsibility and expense, resolve the matter and indemnify the Company for any damages incurred as a result.

Article 11 (Infringement of Third Party Rights)

1.       Contractor represents and warrants that the Goods, Deliverables and/or Services provided to the Company shall not infringe any third party rights (including, but not limited to, intellectual property rights, such as copyrights, patents and trademarks) and Contractor shall, as necessary and at its own cost and expense, obtain consent to use the rights of third parties required to be obtained from the third parties that hold such rights.

2.       In the event that a dispute occurs (or there is a risk that a dispute will occur) between Contractor and a third party with regard to the infringement of the rights described in Clause 1 above (regardless of whether such use was directed by the Company), Contractor shall immediately notify the Company in writing.

Article 12 (Indemnification)

To the fullest extent permitted by law, Contractor shall indemnify and hold harmless the Company, its officers, directors, members, shareholders, owners, affiliates, subsidiaries, agents and employees from and against claims, damages, losses and expenses, including but not limited to attorneys’ fees, arising out of or resulting from the performance of the work described in the Purchase Order, and/or delivery or performance of the Goods, Deliverables, and/or Services. In this regard, such claims, damages, losses and expenses, may include, but are not limited to, any demands or actions arising out of or in connection with (i) a claim that the Services or Company’s use of any Goods or Deliverables infringes on or misappropriates the patent, copyright, trademark or other intellectual property rights of a third party; (ii) any breach by Contractor of any representation or warranty; (iii) the negligence or willful misconduct of Contractor, or its officers, employees and/or agents; and/or (iv) claims by any of Contractor’s employees for compensation of any kind, including, without limitation, for injuries or damages under workmen’s compensation or similar acts.

Article 13 (Intellectual Property Rights in the Goods/Deliverables)

The Company is and shall be, the sole and exclusive owner of all right, title and interest throughout the world in and to all the work product, results and proceeds of the Services, Goods, and/or Deliverables (collectively, the “Work Product”), including all patents, copyrights, trademarks, trade secrets and other intellectual property rights (collectively, “Intellectual Property Rights”) therein. Contractor agrees that the Work Product is hereby deemed a “work made for hire” as defined in 17 U.S.C. § 101 for the Company. If, for any reason, any of the Work Product does not constitute a “work made for hire,” Consultant hereby irrevocably assigns to Company, in each case without additional consideration, all right, title and interest throughout the world in and to the Work Product, including all Intellectual Property Rights therein.

Article 14 (Non-assignment)

Contractor shall not assign or transfer its rights or obligations pursuant to these Terms to any person or entity, nor may Contractor assign or pledge its claims under these Terms to any person or entity or cause any person or entity to assume its liabilities under these Terms without the Company’s prior written consent.

Article 15 (Confidentiality)

1.       Each party (Receiving Party) shall keep in strict confidence all confidential, non-public information obtained from the other party (the Disclosing Party) during, prior to and following the performance of the Transaction (“Confidential Information”), and shall not, without obtaining the prior written consent of the Disclosing Party, disclose or leak the Confidential Information to a third party or use the Confidential Information for any purposes other than that specified in the Purchase Order; provided, however, that this obligation shall not apply in the following cases:

a.       Information that is already public knowledge at the time of disclosure;

b.       Information that is already lawfully possessed by the Receiving Party at the time of disclosure;

c.        Information made public after disclosure due to reasons not attributable to the Receiving Party;

d.       Information, following disclosure by the Disclosing Party, obtained legally without confidentiality obligations from a third party with valid authority to disclose such information;

e.        Information independently developed by the Receiving Party; and

f.        Information which is required to be disclosed by governmental authorities of competent jurisdiction or by applicable law; provided, however, where disclosure has been demanded by governmental authorities or applicable law, to the extent permitted by law, the Receiving Party (a) shall immediately notify the Disclosing Party of such disclosure, and shall not disclose any Confidential Information until (b-1) obtaining the prior written consent of the Disclosing Party or (b-2) taking all legal measures to waive such disclosure or limit the scope of disclosure.

2.       Notwithstanding the previous clause, the Receiving Party may, in the performance of the Purchase Order, disclose Confidential Information to Receiving Party’s employees, affiliates, agents or subcontractors (that have been approved pursuant to Article 17, Clause 1) who have a need to know the information (collectively, the “Permitted Recipients”); provided, however, in such case, the Receiving Party shall, at its own responsibility, impose confidentiality obligations upon the Permitted Recipients equivalent to the confidentiality obligations borne by Receiving Party pursuant to these Terms, and shall bear all liability to the other party for the performance of such confidentiality obligations.

3.       If the Transaction has been terminated for any reason, each party shall immediately return all Confidential Information (whether in/as written form, digital data or any other media form, and including all duplicates) to the other party, and where such Confidential Information cannot be returned, the parties shall seek instructions from the other party as to how to handle the Confidential Information and shall follow such instructions from the other party.

4.       If the parties have executed a non-disclosure agreement in connection with the Goods or Services in addition to these Terms, the provisions of such non-disclosure agreement shall prevail.

5.       Contractor agrees that without the prior written consent of Company, Contractor will not use the name, service marks, or trademarks of Company or any of its affiliated or subsidiary companies, in any electronic or written media, advertising, publicity release, sales presentation or any other publication.

Article 16 (Personal Information)

1.       All personally-identifiable and/or sensitive information relating to Company’s employees and/or Company’s customers (“Personal Information”) entrusted by the Company to Contractor in connection with the Transaction, or that Contractor has obtained through the Services, shall be handled by Contractor in a confidential nature as outlined herein.

2.       Contractor shall select an administrator for the handling of Personal Information and shall not duplicate or copy Personal Information beyond the minimum extent reasonably deemed necessary for the performance of the Services. Additionally, Contractor shall comply with the directions of the Company with regards to the return or destruction of Personal Information following the termination of the Transaction, except where archiving by Contractor is required pursuant to law.

3.       Contractor shall use best efforts to safely manage all Personal Information and prevent the leakage, damage, loss or theft of Personal Information. In the event that an incident occurs with regard to Personal Information, regardless of the cause of such incident, Contractor shall immediately inform the Company of such incident and take all necessary measures to resolve the incident. Additionally, Contractor shall be liable for all incidents, including the leakage, damage, loss or theft of Personal Information.

4.       Contractor shall not use memory cards (such as USB memory) for the storage and transfer of Personal Information.

5.       Contractor shall submit such other forms and verifications as may be requested by the Company from time to time related to the handling of Personal Information.

Article 17 (Relationship Between Parties; Subcontract)

1.       Contractor is an independent contractor of Company, and these Terms as well as the underlying Transaction shall not be construed to create any association, partnership, joint venture, employee or agency relationship between Contractor and Company for any purpose. Contractor has no authority (and shall not hold itself out as having authority) to bind Company and Contractor shall not make any agreements or representations on Company’s behalf without Company’s prior written consent. Without limiting the foregoing, Contractor’s employees and personnel will not be eligible under these Terms or the Transaction contemplated hereunder, to participate in any vacation, group medical or life insurance, disability, profit sharing or retirement benefits or any other fringe benefits or benefit plans offered by Company to employees of Company, and Company will not be responsible for withholding or paying any income, payroll, Social Security or other federal, state or local taxes, making any insurance contributions, including unemployment or disability, or obtaining worker’s compensation insurance on Contractor’s behalf. Contractor shall be responsible for, and shall indemnify Company against, all such taxes or contributions, including penalties and interest. Any persons employed by Contractor in connection with the Transaction shall be Contractor’s employees and Contractor shall be fully responsible for them

2.       Contractor shall not subcontract, whether in whole or in part, to third parties the manufacturing of the Goods or the performance of the Services without obtaining the prior written consent of the Company.

3.       If, in accordance with Clause 2 above, Contractor subcontracts its obligations to a third party upon obtaining the prior written consent of the Company, Contractor shall, at its own responsibility, ensure that such subcontractor comply with the provisions of these Terms, and Contractor shall bear all liability to the Company for the performance by subcontractors.

Article 18 (Compliance with Laws)

1.       Contractor shall comply with all laws, regulations and standards applicable to the Transaction and the Purchase Order and shall also comply with the Fast Retailing Group Business Partner Policy (http://www.fastretailing.com/procurement/jp/) as determined by the Company.

2.       The parties acknowledge that that the performance of the Services by Contractor and payment being made by the Company for the price of the Goods or remuneration for the Services pursuant to these Terms are valid transactions in compliance with applicable laws, such as anti-corruption laws for the prevention of bribery, and are not for any fraudulent purpose. Additionally, Contractor acknowledges that it will continue to comply with all laws, and shall not take any actions in contravention of the law.

3.       Contractor confirms that it has not, whether indirectly or directly, provided any benefits (such as monetary payments) in connection with these Terms or the Transaction, to any public official, or made any promises to do so or permitted any such actions, and will continue to not take such actions going forward.

4.       Contractor’s performance of a Purchase Order is subject to the United States Foreign Corrupt Practices Act (“FCPA”) as well as other applicable anti-bribery laws. Neither Contractor nor any person or entity acting on its behalf will violate the FCPA or any other anti-bribery law for the benefit of or on behalf of Contractor or Company. Contractor will not, directly or indirectly, pay, offer to pay, or authorize the payment of any money or transfer of anything else of value to:

(i)                   An officer, employee, agent or representative of any government, including any department, agency or instrumentality of any government or any government-owned or government-controlled entity or any person acting in an official capacity on behalf thereof, or any political party, any official of a political party or public international organization, or any candidate for political office (each, a “Government or Political Official or Entity”); or

(ii)                 Any other person or entity while knowing or having reason to believe that some or all of the payment or thing of value will be offered, given or promised, directly or indirectly, to any Government or Political Official or Entity;

for the purpose of improperly influencing any act or decision of such Government or Political Official or Entity in his, her or its official capacity. Relevant acts or decisions include a decision to do or not do any act in violation of the lawful duty of such person or entity, or inducing such person or entity to use his, her or its influence with the government or instrumentality thereof to affect or influence any act or decision, in order to obtain, retain or direct any business or to secure any other improper business advantage. Additionally, Contractor will not directly or indirectly make, provide, offer or authorize any payment or anything else of value to any Government or Political Official or Entity for the purpose of expediting or securing the performance of a routine governmental action by such Government or Political Official or Entity. Contractor must immediately notify the Company of any actual or suspected breach of this Article 18.

5.       The parties acknowledge that breach of this Article 18 shall be deemed a material breach of these Terms, and in the event of such breach, the non-breaching party may pursue appropriate remedies against the breaching party, including immediate contract termination.

Article 19 (Notice)

1.       All notices given in connection with the Purchase Order or these Terms shall be sent to the address agreed to in advance by the other party in electronic or written form. Notices given in electronic form shall be deemed delivered upon the earlier of confirmation of receipt or the day following transmission. Notices given in written form shall be deemed delivered upon the earlier of receipt or three (3) business days following dispatch of such notice.

2.       Notice of intent to terminate the contract shall be sent in writing to the address or head office of the other party.

Article 20（Termination）

1.       If any of the following items applies to one party, the other party may terminate, in whole or in part, the contract under the Purchase Order immediately without any notice or other procedures:

(1)            In the event that a party fails to perform its obligations pursuant to these Terms or breaches the provisions of these Terms and fails to remedy such failure or breach despite receiving a reasonable remedy period by written notice from the other party;

(2)            In the event of a breach by Contractor of its obligations to comply with the Fast Retailing Group Business Policy pursuant to Article 18, Clause 1;

(3)            In the event of dishonored bills or checks (self-issued or accepted), payment stoppage or insolvency;

(4)            In the event of a petition (by self or a third party) for the commencement of bankruptcy, civil rehabilitation procedures, or corporate restructuring, voluntary dissolution or other similar procedures;

(5)            In the event of Contractor’s assignment of its operations (in whole or in part) to a third party, discontinuance of or significant change to operations, or resolution for dissolution;

(6)            In the event of Contractors’ dissolution or suspension of business by a supervisory authority;

(7)            In the event of significant changes to the management environment of Contractor due to major events such as a merger or corporate restructuring; or

 

2.       Termination of the contract under the Purchase Order in accordance with Clause 1 above shall not preclude any claims for damages against the other party.

3.       Notwithstanding the contract term pursuant to the Purchase Order, the Company may terminate, in whole or in part, the contract under the Purchase Order, upon thirty (30) days’ prior notice to Contractor.

Article 21 (Liability for Damages and Insurance)

1.       If either party causes damages to the other party due to a breach of these Terms, such party shall be liable for the damages incurred by the other party.. The Company shall not, however, have any liability to Contractor for indirect, consequential, special, incidental, or punitive damages, including, without limitation, for any loss of clientele, sales, profits, or opportunities, regardless of whether arising from breach of contract, warranty, tort, strict liability or otherwise, even if the Company is advised of the possibility of such damage or loss or if such loss or damage could have been reasonably foreseen.

2.       Contractor shall obtain and maintain, at its own expense, insurance coverage on a primary and non-contributory basis including General Liability Waiver of Subrogation, at the limits set forth below (or currency equivalent thereof): (a) Workers Compensation insurance providing the statutory limits and not less than $1 million of Employers Liability coverage; (b) General Liability coverage in an amount not less than $2 million per occurrence; and (c) such other coverage as reasonably requested by the Company. Contractor shall provide the Company with certificates of insurance evidencing such coverage and naming Company as an additional insured if and as so requested, and shall notify Company at least thirty (30) days prior to any change, termination or expiration of such coverage. The amounts of insurance coverage required under this section do not limit Contractor’s liability hereunder.

Article 22 (Effect of Termination)

1.       Upon the end of the term or early termination of the contract under the Purchase Order, the parties shall immediately return any lent materials or equipment received from the other party pursuant to any instructions from such other party.

2.       In the event that Clause 1 above applies, the Company shall have priority rights over third parties to purchase the Goods or Deliverables, unfinished products and any special molds, tools or other equipment created for the production of the Goods or Deliverables.

Article 23 (Survival)

Even upon the end of the term or early termination of the contract under the Purchase Order, the parties shall continue to bear the obligations imposed by the following provisions:

Article 8 (Warranty)

Article 9 (Defect liability for Goods or Deliverables)

Article 12 (Indemnification)

Article 13 (Intellectual Property Rights in the Goods/Deliverables)

Article 15 (Confidentiality)

Article 16 (Personal Information)

Article 22 (Effect of Termination)

Article 23 (Survival)

Article 24 (Severability)

Article 26 (Jurisdiction)

Article 24 (Severability）

Any provision of these Terms which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provisions in any other jurisdiction. To the extent permitted by applicable law each party hereby waives any provision of law which renders any provisions hereof prohibited or unenforceable in any respect.

Article 25 (Waiver)

The failure by one party to require performance of any provision shall not affect that party’s right to require performance at any time thereafter, nor shall a waiver of any breach or default of these Terms constitute a waiver of any subsequent breach or default or a waiver of the provision itself.

 

Article 26 (Jurisdiction)

The parties hereby agree that these Terms and Purchase Order, as well as the Transaction contemplated hereunder, shall be governed by and shall be construed in accordance with the laws of the State of New York without regard to its conflict of laws rules. The parties also agree that the State and Federal Courts located in New York shall have exclusive jurisdiction to settle any disputes in connection with the Purchase Order Terms and the Transaction contemplated hereunder.