MASTER SOURCING AGREEMENT - CSI Vendor Manual

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MASTER SOURCING AGREEMENT This Master Sourcing Agreement, together with (as applicable) all addenda, supplements, items and terms identified herein (the "Agreement") establishes the legal relationship between Buyer named below ("Buyer") and each Seller named below (collectively, "Seller"), and will apply to all transactions involving the sale of goods and/or services (collectively, whether goods and/or services, "Goods") between Buyer and Seller. In transactions involving the services of a Buying Agent designated by Buyer (the "Buying Agent"), the Buying Agent is acting in all respects solely in its capacity as Buying Agent for and on behalf of the Buyer and not as a buyer or in any other capacity. Seller Specific Addenda The Agreement between Buyer and Seller includes each of the following Addenda, which constitute an integral part hereof. By signing the Agreement, Seller accepts all terms, conditions and obligations set forth in the following Addenda and agrees to comply fully with their terms:

Addendum No. 1: General Sourcing Terms and Conditions

Addendum No. 2: Certification of Compliance with Charming Shoppes, Inc. Code of Conduct, Laws and Regulations and Labor Standards

Addendum No. 3: Selected Laws Addendum No. 4: Buyer Notice Addresses

Addendum No. 5: Modifications for Sellers Using Nationally Recognized Brand Labels

Owned by Seller Addendum No. 6: Electronic Data Interchange (EDI) Trading Partner Agreement


The Master Sourcing Agreement (2011 version) is signed by a duly authorized representative (1) by and on behalf of each Seller indicated below, jointly and severally, and (2) by and on behalf of Buyer indicated below, and (3) if applicable, by and on behalf of Buying Agent indicated below.

Date:

Delivery Terms � FCA Origin � DDP/DAP Payment Terms � 45 Days Open Account � 60 Days Receipt of Goods

The Agreement is made to be effective as of the stated date, provided that the Agreement shall supersede the terms of orders placed by Buyer with Seller prior to such date.

BUYER INFORMATION AND SIGNATURE

BUYER: Any of the following entities issuing any Purchase Order:

Charming Shoppes of Delaware, Inc., CSI Industries, Inc., Catherines Stores Corporation, Lane Bryant Purchasing Corp., Outlet Division Management Co., Inc., Figi’s Inc., Figi’s Business Services, Inc., Figi’s Gifts, Inc., Figi’s Mail Order Gifts, Inc.

By:

Name and Title Addresses for Notices to Buyer: See Addendum No. 4

BUYING AGENT INFORMATION

BUYING AGENT:

By:

Name and Title Addresses for Notices to Buying Agent:


SELLER INFORMATION AND SIGNATURE INSTRUCTIONS:

PLEASE FILL IN INFORMATION COMPLETELY. TYPE OR PRINT. IF ANY LINE OR ITEM DOES NOT APPLY, PLEASE TYPE OR PRINT "NA".

SELLER: Full Formal Name of Company By: Signature of Authorized Representative Printed Name Title or Capacity

SELLER (Continued) If "SELLER" includes more than one company, or if "SELLER" uses other names, fill in the additional companies and/or names below: Additional Company and/or Name Printed Name of Authorized Representative Address

Address Address Address Fax Telephone E-mail

___________________________________________ Address ___________________________________________ Address ___________________________________________ Additional Company and/ or Name ___________________________________________ Printed Name of Authorized Representative ___________________________________________ Address ___________________________________________ Address ___________________________________________ Address


ADDENDUM NO. 1

GENERAL SOURCING TERMS AND CONDITIONS

The following terms and conditions will apply to all transactions involving the sale of goods and/or services (collectively, whether goods and/or services, "Goods") between Buyer ("Buyer"), and each Seller ("Seller") named on the signature page of the Master Sourcing Agreement (the "Agreement"). Any references herein to Buying Agent shall apply only if a Buying Agent is named on the signature page of the Agreement. Buying Agent shall act for and on behalf of Buyer solely in its capacity as Buying Agent and not as a buyer or in any other capacity. Goods shall include sub-materials such as piece goods or yarn from which the Goods will be manufactured, and any accessories or components which will be used in, on or in respect of the Goods, including, without limitation, thread, name plates, rivets, buttons, snaps, closures, polybags and other packaging materials, labels and tags. 1. Contract Terms.

Buyer (or Buying Agent acting on behalf of Buyer) and Seller may create binding contracts for the purchase and sale of Goods by exchanging one or more written or electronic communications by any commercially reasonable means showing agreement as to the following items: description of Goods, price, quantity, date of delivery, and means of shipment. The terms of any such contract between Buyer (or Buying Agent acting on its behalf) and Seller will be comprised exclusively of the foregoing items, the terms of the Agreement, any supplements or addenda identified herein, the terms of the Buyer’s Vendor Partnership Manual ("VPM", as made available on Buyer's website and as amended from time to time as shown on a changes page(s) on such VPM), and any other applicable policies, manuals, guidelines, specifications, terms and other instructions which have been or may from time to time hereafter be furnished to Seller, including by posting on Buyer's website (each of which is incorporated herein by reference and deemed agreed to by Seller), and such other terms and conditions contained in the parties' written or electronic communications as set forth in Section 2 below. Posting of changes to such VPM and/or any other applicable policies, manuals, guidelines, specifications, terms and other instructions on Buyer’s website, to which Seller has been given electronic access, shall be deemed sufficient notice to Seller of such changes. Each contract hereunder shall be deemed separate and severable and not part of one or more installment contracts. If there is a conflict between the terms of this Agreement and any other documents which comprise a contract, the specific terms of an order (e.g. quantity, price) shall have priority, and thereafter, the terms of this Agreement shall control unless the parties provide otherwise in writing. The Buying Agent shall in no way incur liability to the Seller in respect of this Agreement. This Agreement may be enforced against the Seller either by the Buying Agent in its own name acting on behalf of the Buyer or by the Buyer. 2. Entire Agreement.

With respect to any such contract, the terms identified in Section 1 will constitute the complete and exclusive statement of the terms and conditions between the parties, and supersede and merge all prior proposals, understandings and all other agreements, oral and written, between the parties relating to the Agreement. The Agreement may not be amended, modified or altered except by a written instrument duly executed by authorized representatives of both parties (except that the VPM, and any policies, manuals, guidelines, specifications, terms or other instructions issued by Buying Agent or Buyer to Seller shall be deemed incorporated herein as set forth above and shall not be required to be executed by Seller), and any proposals for any additional or different terms contained in communications from Seller which are not signed by Buyer are objected to by Buyer without further notification and shall not constitute a part of any contract. In addition, no course of dealing or manner of performance will constitute a waiver of or modify against Buyer any of such terms and conditions. Nothing in the Agreement will require Buyer (or Buying Agent on its behalf) to enter into contracts for the purchase of Goods from Seller. 3. Exchange of Communications.

The provisions of this Section 3 and Addendum No. 6 shall apply to the exchange of electronic data interchange ("EDI") transaction sets, if applicable. With respect to electronic communications, each party may electronically transmit to or receive from the other those EDI transaction sets as identified under the EDI Section of the Buyer’s VPM. Buyer at its discretion may add or delete transaction sets from its VPM. Posting of changes to the VPM on Buyer’s website to which Seller has been given access, shall be deemed sufficient notice to Seller of such changes. Any other transmission of data shall have no force or effect between the parties unless justifiably relied upon by the receiving party. Each party will adopt, and the other will keep confidential, an electronic identification consisting of symbols or codes to be contained in or affixed to each such transmission for purposes of authentication, and each transmission so authenticated shall be deemed to be signed and in writing. Each party will implement security procedures reasonably sufficient to verify that communications between the parties are authentic and authorized, to detect errors in transmission or content, and to provide for protection against improper disclosure or access. Neither


party will be responsible for a communication received from the other party in unintelligible or garbled form, provided the receiving party gives prompt notice to the originating party (if identifiable from the received document) of any such occurrence. With respect to any contract evidenced in an electronic manner contemplated by the Agreement, the parties expressly waive any defense they may have under any law requiring contracts to be evidenced by a signed writing, and agree that electronic communications as described herein shall satisfy any requirement that an agreement be in writing. Each party is subject to the provisions of Addendum No. 6 - Electronic Data Interchange (EDI) Trading Partner Agreement. 4. Invoicing, Packaging and Labeling.

Seller shall ensure that all Goods delivered under the Agreement will be invoiced and packaged in accordance with the terms of the contract relating thereto, including the provisions of the Agreement and the VPM and any other applicable policies, manuals, guidelines, specifications, terms and/or other instructions which have been or may from time to time be furnished to Seller by Buyer or Buying Agent, each of which is incorporated herein by reference. All applicable taxes shall be shown as individual line items on every invoice. All invoicing and packaging will comply with Laws and Regulations (as hereinafter defined in Section 13.b.), be adequate to preserve and protect the Goods, and satisfy the requirements of the carrier being used for shipment. Any approval by the Buyer or Buying Agent of the Seller's form of packing shall not in any way release the Seller from its obligations hereunder. No charge will be made by the Seller for any packing, crating, freight or express charges, cartage or containers unless previously agreed to in writing by the Buyer or by Buying Agent at the direction of the Buyer. Seller shall be responsible for identifying and informing Buyer of any Goods which may be subject to special labeling requirements pursuant to any Laws and Regulations, and shall provide the appropriate labels as well as Material Safety Data Sheets for all such Goods. 5. Code of Conduct, Verification of Country of Origin and Other Related Matters.

The Agreement incorporates the most recently issued Charming Shoppes, Inc. Code of Conduct and all attachments thereto, which contain additional terms and conditions related to the verification of Country of Origin. The Charming Shoppes, Inc. Code of Conduct shall apply to the manufacture or provision of Goods purchased under the terms of the Agreement. Each update to the Charming Shoppes, Inc. Code of Conduct and attachments thereto shall be deemed incorporated into the Agreement upon delivery to the Seller or incorporation into the VPM. When Buyer is not the importer of record, Seller shall provide to Buyer upon request all documentation required to substantiate the origin of Goods, as further set forth in the Code of Conduct and attachments thereto. When Buyer is the importer of record, the purchase of the Goods is expressly conditioned and subject to the submission by Seller to Buyer (or to Buying Agent on Buyer's behalf) of properly completed and executed Country of Origin Declaration(s) and other documentation as required by the Bureau of Customs and Border Protection of the Department of Homeland Security of the United States of America ("CBP") and as further specified in the Code of Conduct and attachments thereto. Each such declaration will be supplied by the Seller (and bear the original signature of an authorized representative of the Seller and any other party that is required by CBP to sign such declaration) and provided to the Buyer (or Buying Agent on Buyer's behalf) together with the original commercial invoice and textile visa (where applicable), in a manner prescribed by Buyer, or Buying Agent acting on its behalf. Any visa accompanying the Goods shall be in the form required by the applicable bilateral textile agreement between the exporting country and the destination country, and any amendments thereto, and any textile quota category reflected thereon shall accurately describe the Goods. Seller shall supply all other documentation, including but not limited to export licenses and production records, which may be necessary for shipment of the Goods and importation and full release for consumption of the Goods into the United States of America. 6. Factory Evaluations and Identification.

a. Factory Evaluations –Buyer shall have the right, either itself or through agents, to conduct or have conducted periodic factory evaluations to ensure factory, contractor, subcontractor, and supplier compliance with the Charming Shoppes, Inc. Code of Conduct, Laws and Regulations (as defined in Section 13.b. hereof) and Labor Standards (as defined in Section 8 hereof). Such factory evaluations will be conducted by an independent third party approved by Buyer, and using the Buyer’s Factory Evaluation forms. Any costs associated with a factory evaluation are the responsibility of the Seller. Buyer, or Buying Agent acting on its behalf, reserves the right to reject a manufacturer based on the results of the factory evaluation. No such factory evaluation shall limit, reduce or exclude Seller’s obligations or liabilities under this Agreement.

b. Factory Identification - Buyer requires each factory used to produce textile, apparel, footwear and

handbag Goods to be registered and assigned an identification number prior to initiation of production. Thereafter, for each purchase made by Buyer (whether directly or through a Buying


Agent), Buyer requires notification by Seller of which registered factory will be used to produce the Goods being purchased, and Seller may not change the factory without the prior written approval of Buyer. The factory identification number is to be placed on the Goods in accordance with the requirements set forth in the VPM. Buyer reserves the right to extend the Factory Identification program to Goods other than those specifically provided for herein.

7. Production.

Unless such requirement is waived by Buyer, Seller shall not commence production of the Goods until Seller has submitted to the Buyer or the Buying Agent, and the Buyer or the Buying Agent has approved, a pre-production sample of the Goods (the "Pre-Production Sample"). In the event that Seller does not submit a Pre-Production Sample to the Buyer or the Buying Agent or the Pre-Production Sample submitted is not approved by the Buyer or the Buying Agent, the Buyer shall be entitled to terminate the applicable contract hereunder, or the Buying Agent may do so on the Buyer's behalf. In the event that Buyer supplies any sub-materials to Seller, Seller hereby undertakes to take delivery of, store and hold any such sub-materials as trustee and agent for the Buyer, and to return the same if the applicable contract is terminated. While such sub-materials are in the possession or control of Seller, Seller shall be deemed an insurer thereof and shall be fully responsible therefore, and shall hold the same in trust for the benefit of Buyer (and its lender, if applicable). 8. Labor Standards.

The Agreement includes an Addendum entitled "Addendum No. 2: Certification of Compliance with Charming Shoppes, Inc. Code of Conduct, Laws and Regulations and Labor Standards" ("Labor Standards"). The provisions set forth in Addendum No. 2 shall apply to the manufacture or provision of Goods purchased under the terms of the Agreement. Seller shall not use home-workers in the manufacture or provision of Goods purchased under the terms of the Agreement. 9. Delivery.

Time is of the essence for each contract created under the Agreement. Seller shall deliver the Goods in accordance with the delivery schedules and to the location(s) specified in each contract created hereunder. Seller shall promptly notify Buyer and Buying Agent in writing of any delay, but such notice shall not excuse the delay. In the event of any delay, Buyer (i) may assess late penalties as set forth in the VPM, and (ii) reserves the right to require that Seller ship the Goods by air or other expedited transportation mode designated by Buyer (or Buying Agent acting on its behalf) at Seller's sole cost and expense. Buyer or Buying Agent on behalf of Buyer may renegotiate or reduce the value of the Goods to take into account any late penalties and/or the cost of air or expedited transportation necessary to maintain Buyer's schedule. Seller shall ensure that all Goods delivered under the Agreement will be shipped in accordance with the terms of the VPM, or other applicable policies, manuals, guidelines, specifications, terms and other instructions which have been or may from time to time be furnished to Seller by Buyer or Buying Agent (each of which is incorporated herein by reference). In the absence of specific instructions to the contrary, delivery will be either FCA origin or designated consolidator (Incoterms 2010), or DDP (delivery duty paid) (used in conjunction with domestic purchase order if Goods produced outside the U.S.)/DAP (delivery at place) (used in conjunction with domestic purchase order if Goods produced within the U.S.) at designated Distribution Center (Incoterms 2010), as specified on the signature page to the Agreement. Transfer of title and risk of loss shall pass at the designated point of consolidation if delivery is FCA, and at Buyer's distribution facility if delivery is DDP or DAP. Regardless of the transfer of title and risk of loss, Seller shall be responsible for export of the Goods from the country of origin. Transfer of title and risk of loss shall not constitute acceptance of the Goods, which shall occur as set forth in Section 12 hereof. Multiple or split shipments for one contract are prohibited and may be refused at Buyer's sole discretion. Seller shall promptly notify Buyer in writing if Seller intends to ship in multiple or split shipments, which notice shall not excuse the failure to comply with the terms hereof. Should Buyer agree to accept such shipments, Buyer may assess charges as set forth in the VPM. 10. Inspection.

Representatives of the Buyer and/or Buying Agent shall have the right to inspect and examine the Goods at the Seller's factory or elsewhere, at all reasonable times, both during production and when finished and packed or in the course of being packed for shipment. No such inspection or the execution of any inspection certificate by the Buyer or Buying Agent or a representative on their behalf, shall constitute or be deemed to constitute an acceptance of the


Goods or of their conformity with any of the terms and conditions or specifications of this Agreement or any contract created hereunder. The Buyer or Buying Agent may appoint, at its sole discretion, a duly qualified inspector, surveyor, analyst and /or weigher (the "Expert"") to inspect the Goods wherever they may be located, and a certified report of the Expert shall be conclusive and binding on the Seller for all purposes and in all contexts as to the quantity, quality, condition, description and specifications of the Goods and their conformity or non-conformity (as the case may be) with the requirements of this Agreement or any contract created hereunder, and admissible into evidence in any proceedings without the Expert being called as a witness. Buyer and Buying Agent may rely on Seller's representations and warranties with respect to the Goods and will not be obligated to unpack and inspect them before resale. Buyer's payment for, retention, use or acceptance of Goods will be deemed neither a waiver of Buyer's or Buying Agent's right to inspect them at any reasonable time or place and in any reasonable manner, nor a waiver of any breach of a representation or warranty by Seller. 11. Notice of Defect or Breach.

Buyer or Buying Agent may give Seller notice of any defect or breach in any reasonable manner, and any such notice will be considered timely if made within a reasonable time after discovery by Buyer or notification to Buyer from its customer. Buyer waives no rights with respect to any defect or breach not identified in the notice. 12. Nonconforming Shipments and Nonconforming Delivery.

A nonconforming shipment shall include, but is not limited to, any shipment for which the Goods are embargoed or seized or denied entry by any government agency, or if applicable, denied preferential or special duty-free treatment under the provisions of a free trade agreement, trade legislation providing for duty-free treatment or qualified industrial zone program. A nonconforming delivery shall include any delivery in connection with which the Seller has not fully complied with any term or condition, express or implied, of this Agreement or any contract hereunder, or any supplements or addenda identified herein, in the VPM, or in other applicable policies, manuals, guidelines, specifications, terms and other instructions, regardless of whether any defect or nonconformity could have been discovered upon inspection. In no event shall acceptance of any Goods occur prior to the satisfactory completion of Buyer's quality assurance inspection at its distribution center within the U.S. substantiating that the Goods meet acceptable quality levels as determined by Buyer. In addition to any other rights and remedies stated herein, Buyer (or Buying Agent acting on behalf of Buyer) may exercise any of the following rights with respect to nonconforming shipment or nonconforming delivery of Goods: (a) reject (or revoke acceptance of) the entire shipment; (b) accept the entire shipment; or (c) accept any number of commercial units (i.e., an item of the Goods that can be sold at retail) and reject (or revoke acceptance of) the balance of the shipment. Any Goods so rejected/revoked may, at Buyer’s option, be either returned to Seller for full credit, resold for Seller's account (less Buyer's reasonable expenses) in any reasonable manner, stored for Seller's account pending Buyer’s or Buying Agent's receipt of reasonable instructions as to their disposition, or donated to charity if Seller has not provided disposition instructions to Buyer or Buying Agent within thirty (30) days after notification to Seller that such Goods are rejected or revoked, or if Buyer or Buying Agent reasonably believes that Seller will not reimburse Buyer for storage, return transportation and other incidental charges incurred in connection with such Goods. Seller will bear all risk of loss associated with rejected/revoked Goods. Buying Agent and Buyer waive no rights with respect thereto (including if any such Goods are donated to charity) and Seller will promptly reimburse Buyer and Buying Agent for all unrecovered reasonable expenses incurred in connection therewith. Any shipments in excess of quantities ordered shall be deemed to be in consideration of defective units. Buyer shall be entitled to retain same and Seller shall have no claim with respect thereto. 13. Representations and Warranties; Assignment of Rights.

In addition to and without prejudice to other warranties, express or implied, Seller represents and warrants to Buyer and Buying Agent that:

a. Each contract created under the Agreement: (1) will constitute the legal, valid and binding obligation of Seller; (2) is enforceable in accordance with its terms; and (3) violates no Laws and Regulations, or any contract or understanding to which Seller is subject.

b. Seller shall ensure that all Goods delivered under the Agreement will be: (1) new and unused; free

from defects in materials, workmanship and fabrication; fit for the particular purposes or uses, if any, either specified by Buyer or Buying Agent or otherwise known to Seller; in strict accordance with the Pre-Production Sample and Buyer’s or Buying Agent's specifications, descriptions, sketches, patterns, lab dips, strike offs, lab test standards, drawings, instructions, or prototypes with respect to quality, quantity, weight, size, description, color and dimensions, and otherwise in


compliance with normal retailing standards with respect to such items as color, wash and light fastness; able to pass without objection in the trade, be of first quality and conform to all statements made by Seller or its agents or contained in Seller's advertising or promotional material; (2) free of any security interest, lien or other encumbrance of any kind; (3) tested, produced, labeled, packaged, shipped and invoiced in compliance with this Agreement, the VPM, and Buyer's applicable policies, manuals, guidelines or other instructions which have been or may from time to time be furnished to Seller (each of which is incorporated herein by reference) and with all laws, statutes, rules, codes, ordinances and/or regulations of the United States, or of any other jurisdiction, applicable to Seller, the Goods or to the conditions or process of their manufacture, whether or not specifically referred to herein and whether relating to country of origin, product content or quality, safety, environmental matters, or otherwise ("Laws and Regulations") and Labor Standards, including without limitation the foreign, domestic, federal, state and local laws, regulations and/or standards relating to the Goods as described on Addendum No. 3 of the Agreement entitled "Selected Laws"; (4) prepared for importation and/or imported in compliance with Laws and Regulations, including without limitation all regulations and policies of the United States, including those of the CBP in effect from time to time (each of which is incorporated herein by reference); and (5) free of infringement or violation of any United States or foreign patent, trademark, trade name right, copyright or trade secret, right of publicity or privacy right or any other proprietary, intellectual property, industrial property, contract or other right held by any third party. Seller will promptly provide Buyer and its Buying Agent(s) with any information requested by Buyer or its Buying Agent(s) in order to verify compliance with the representations and warranties set forth herein.

c. Seller shall take all necessary steps to protect the Goods and Seller's transportation and

distribution network against the introduction of terrorists and/or their weapons at all times during which the Goods are in the possession or control of Seller, its contractors, subcontractors, vendors, suppliers or agents.

d. Seller is able to comply and has fully complied with the Agreement, and Seller, its employees,

agents, vendors, contractors, subcontractors and suppliers are able to comply and have fully complied with all Laws and Regulations and Labor Standards, including without limitation country of origin and other requirements of the CBP and related agencies, and all similar requirements of other applicable jurisdictions, with respect to all Goods sold to Buyer under the Agreement.

e. Seller has procured and shall maintain such licenses and permits as are required to fully perform

the Agreement and any contract created under the Agreement.

f. If any Goods are wholly or partly not of the Seller's manufacture, the Seller shall and does hereby assign to the Buyer the benefit of any warranties or other rights conferred upon or otherwise available to the Seller as against the actual manufacturer or other third party, including but not limited to any contractors, subcontractors and suppliers, and shall attempt to procure for Buyer the benefit of any such warranties or other rights, which shall be in addition to all warranties provided by Seller. Seller shall promptly notify such manufacturer or other third party in writing of such assignment, but such assignment shall not affect the Buyer's rights against the Seller or the Seller's obligations hereunder. Any warranty which cannot be assigned shall be enforced by Seller on behalf of Buyer.

g. Seller will promptly provide Buyer, Buying Agent or its designated representative with any information reasonably requested in order to verify compliance with this Section 13.

h. Seller will assign to Buyer all drawback rights and refunds available from the CBP in respect of

Goods delivered by Seller pursuant to the Agreement and paid for by Buyer, and Seller will cooperate with Buyer and Buying Agent in taking all steps necessary to obtain any such refund.

i. Buyer shall have the right to sell the Goods in any retail locations, through mail order and/or

electronic means, as specified by Buyer.


14. Price; Payment Terms.

Quoted prices will include all charges which may be imposed under the terms of any contract under the Agreement, and in no event will Seller be allowed to assess or charge any extra charges of any kind (including, without limitation, interest or service charges, taxes, duties, cartage, boxing, freight or carrying charges) unless otherwise agreed in writing by Buyer. Unless another payment schedule is expressly contained in a contract created under the Agreement, Buyer’s standard payment terms will apply (i.e., U.S. Dollars, immediately available funds, with payment occurring (a) in the case of FCA shipments, 45 days after (i) shipment, and (ii) submission of required documentation, or (b) in the case of DDP or DAP shipments, 60 days after Receipt of Goods at Buyer’s designated distribution center). All dating begins on the later of (i) receipt of Goods at the Buyer’s designated consolidator or (ii) receipt of invoice and other documentation by Buyer. U.S. Dollar equivalents of any invoice permitted by Buyer to be stated in a foreign currency will be determined at the selling rate for converting such currency into U.S. Dollars, as published in The Wall Street Journal, for the contract date or, if such date is not a banking day, on the last banking day prior thereto. Payment is conditioned upon clearance by CBP and full release for consumption of the Goods into the U.S. If the Goods are not cleared by CBP and fully released for consumption into the U.S., Buyer, or Buying Agent acting on behalf of Buyer, reserves the right to cancel the contract created under this Agreement and to withhold payment. Buyer may set-off against amounts payable under any contract, and all other payments due Seller, all past, present and future claims by Buyer whether or not related to each other. Buyer reserve the right to communicate such set-offs directly with the Seller or through a designated Buying Agent. If any rights of Seller to receive payment hereunder shall be assigned to a bank, factor, or other third party, then even after notice of such assignment is provided to Buyer, the assignee(s) shall be bound by, and subject to, any defenses which Buyer may have against Seller and any agreements made by Buyer and Seller regarding the Goods or payment therefore, whether arising before or after such assignment, including, without limitation, any claims in connection with nonconforming Goods, and any chargebacks, allowances, credits, set-offs or rebates. The foregoing rights of Buyer shall not be deemed to have been waived unless such waiver is in a writing signed by the President of Buyer. 15. Tax or Duty Refunds.

If any tax or duty of any kind is included in the price of the Goods, then if all or any part of that tax or duty is refunded to Seller, Seller shall promptly remit such refund in full to Buyer. 16. Chargebacks and Other Adjustments.

In addition to any other rights and remedies available to it, Buyer may deduct from any payment otherwise due Seller the value of any Goods shipment, or set-off against any claim of Seller any amount due to Seller, from Buyer or any of its affiliates. Chargebacks may be imposed by Buyer to compensate it for its good faith estimate at any time of the cost and expense resulting from any one or more of the following events: failure to pay transportation or importation costs; absence or illegibility of packing lists; failure to transmit timely and accurate required EDI transactions; Goods received without strict compliance with shipping and packing instructions; incorrect or incomplete labeling, sizing, prepackaging or preticketing, or inconsistent quantities per package; incorrectly hung garments; failure to meet quality or other standards; recalls; returns to Seller; storage charges; improper invoicing; early or late delivery; overages, shortages or unauthorized partial receipts or substitutions; concealed damage, poor quality, substandard or soiled Goods; handling and freight charges for any store recalls; or any other breach of the Agreement or any contract created under the Agreement. Information pertaining to chargebacks is set forth in the VPM, as may be amended from time to time, which is posted on Buyer’s website to which Seller has been provided access. Posting of changes to the VPM on Buyer’s website shall be deemed sufficient notice to Seller of such changes. In addition, Buyer may take reasonable discounts reflecting savings by Seller resulting from any prepayment, or from Buyer's central distribution, warehousing and reshipment to its stores. 17. Indemnity and Insurance.

a. Seller agrees to indemnify, defend and hold harmless Buyer and Buying Agent and their parent companies, affiliates and subsidiaries, and their respective directors, officers, employees, agents, customers, successors and assigns, from and against any and all claims, proceedings, actions, suits, liabilities, losses, costs, damages, penalties (including but not limited to any penalties or liquidated damages assessed by, or paid to, any government agency), and expenses (including but not limited to reasonable attorneys' fees, other professional fees and other costs and expenses) relating to, based upon, resulting from or pertaining to the Agreement or any contract created under the Agreement or any Goods delivered to Buyer, whether arising before or after delivery, or which involves or alleges: infringement or violation of any patent, trademark, trade name, copyright, trade secret, right of publicity or privacy right or any other proprietary, intellectual property, or industrial property right; unfair competition; violations of Laws and Regulations; personal injury


or property damage; failure of Goods to comply with any express or implied warranties of Seller; incorrect origin declaration or other origin documentation; incorrect declarations or documentation regarding qualifying rules for duty free claims under preferential duty programs; failure of the Goods to obtain clearance by CBP and full release for consumption of the Goods into the U.S.; or any breach of the Agreement or any contract created under the Agreement. Buyer and/or Buying Agent, at its option and expense, may participate in the defense of any such claim or proceeding. In no event shall Seller enter into any settlement without Buyer’s prior written approval, which shall not be unreasonably withheld. Buyer’s approval of any settlement shall not be deemed a waiver by Buyer of any insurance coverage that may be available to Buyer.

b. Unless specifically waived in writing by Buyer or Buying Agent, Seller shall maintain, at Seller's expense, commercial general liability insurance with an insurance company licensed to do business in the United States earning a minimum rating of A, Financial Size X in Best’s Reports. Such insurance shall provide for minimum limits of US$2,000,000 bodily injury and US$2,000,000 property damage per occurrence, with a products liability aggregate limit of at least US$5,000,000, coverage for contractual indemnification obligations, and broad form Seller's endorsements naming and covering Buyer and Buying Agent as additional insureds, and shall be primary over any and all other collectible insurance. All such policies shall provide that coverage thereunder shall not be terminated or changed without at least thirty (30) days prior written notice to Buyer or Buying Agent, and Buyer shall be furnished original certificates of insurance and evidence of renewals. Buyer, in its sole discretion, reserves the right to require additional coverage from time to time. The purchase of such insurance and furnishing of such certificates shall not limit Seller's obligations hereunder or in any way modify Seller's agreement to indemnify Buyer and Buying Agent as set forth herein. In the event Seller purchases insurance of the "claims made" variety, Seller shall purchase an extended reporting period tail, or maintain the claims made policy, so that Buyer and Buying Agent are protected from any and all claims brought against Buyer and Buying Agent for a period of not less than three (3) years from the date of last purchase agreement between Seller and Buyer.

18. Force Majeure.

This Agreement may be cancelled by Buyer, or any contract hereunder may be cancelled by Buyer or Buying Agent, neither of whom shall incur any liability or obligation whatsoever in respect thereof, or the Buyer may at its option suspend shipments of the Goods in whole or in part at any time, in the event the performance of this Agreement or any contract hereunder is rendered in whole or in part illegal, impossible or impractical by reason of government restrictions, devaluation or revaluation of currency, war, strikes, embargo, riots, civil commotion, labor disputes or unrest, acts of God, or any other circumstances beyond the control of the Buyer. 19. Confidentiality.

Seller, for itself and its parent companies, affiliates and subsidiaries, vendors, contractors, subcontractors, suppliers and its and their principals, partners, officers, directors, employees and agents (“Seller Related Parties”), agrees to treat as strictly confidential all specifications, drawings, samples, models, designs, price lists, orders and business information provided by Buyer or Buying Agent to Seller. Such information will remain the exclusive property of Buyer or Buying Agent and will only be disclosed to the extent reasonably necessary for Seller's employees and agents to perform Seller's obligations hereunder, and Seller will take all reasonable measures to assure that the recipients of such information protect the confidentiality thereof. Without the prior written consent of Buyer, which may be withheld in Buyer’s sole discretion, Seller will not make any public disclosure of the Agreement, any contract created under the Agreement, or any relationship whatsoever between Buyer or Buying Agent and Seller, and Seller shall further ensure that none of the Seller Related Parties makes any such disclosure. Naming Buyer or Buying Agent in any brochures, on a website, or in other promotional materials are examples of the disclosures prohibited hereunder. Upon termination of the Agreement, or at any time upon Buyer’s or Buying Agent's request, Seller shall promptly return to Buyer or Buying Agent all forms of Buyer's or Buying Agent’s confidential information, including copies. Seller acknowledges that Buyer's and Buying Agent's confidential information is unique and that monetary damages would be insufficient to compensate Buyer and/or Buying Agent for any breach of this Section by Seller or the Seller Related Parties. Accordingly, Seller agrees that, in addition to any other available remedy, Buyer and/or Buying Agent will be entitled to injunctive and other special and equitable relief in connection with any such breach. Seller agrees to incorporate into its agreements with its direct and indirect vendors, contractors, subcontractors and suppliers, and to enforce for its benefit and the benefit of Buyer and/or Buying Agent the terms of this Section. Seller agrees that any breach of this Section is a material breach. The


provisions of this Section shall continue and remain in full force and effect during the term of this Agreement and for a period of two (2) years after the termination thereof.

20. Intellectual Property.

a. If Buyer provides the designs for any Goods to be manufactured or sold by Seller, the designs shall remain the property of Buyer, and Seller shall acquire no rights to the trademarks, service marks, patents, labeling, packaging, hang-tags, trade names, distinctive words, logos, drawings, art work, pictures, colors, formulas, designs, design models or copyrights, derivations or adaptations thereof, or any marks or works similar thereto (collectively, the "Intellectual Property"). If Seller provides the designs for any Goods to be manufactured or sold by Seller, then Seller shall retain rights to the designs; however, Seller shall acquire no rights to Buyer's Intellectual Property attached to or associated with such Goods, as to which Buyer retains and reserves all rights. Further, if any design constitutes Buyer's modification of a design provided by Seller, the resulting modified design shall become Buyer's Intellectual Property. With respect to any design originating from Seller, during the performance of any order for Goods and for a period of one year after the last date of delivery of any particular items or types of such Goods to Buyer, Seller shall not manufacture, sell, market, promote, advertise or distribute to any third party such Goods, except to the extent that such Goods fall within one of the exceptions delineated in the last sentence of subsection e. of this Section 20. When Buyer’s Intellectual Property is attached to or associated with Goods made from Buyer's designs, Seller shall not, in perpetuity, manufacture, sell, market, promote, advertise or distribute to any third party such Goods.

b. Seller agrees not to manufacture, market, distribute, sell or otherwise transfer any Goods that bear or use Buyer's Intellectual Property to third persons without first obtaining the written approval of Buyer and physically removing each and every use of Buyer's Intellectual Property from the Goods.

c. Except in accordance with Buyer’s written policies regarding same which are incorporated herein by reference, Seller shall not sell, market, distribute or use for any purpose or permit any third party to sell, market, distribute or use for any purpose any Goods or promotional or packaging material relating to Goods which are damaged, seconds, defective, dated or out of style, fail to meet Buyer’s specifications or quality standards in the Agreement, or are otherwise rejected by Buyer. In the event of a conflict between this Agreement and Buyer’s written policies, the written policies shall control.

d. Seller shall not make any unlicensed use, file any application for registration or claim any other proprietary right to any of Buyer's Intellectual Property.

e. Buyer and Seller agree that all material, including without limitation all artwork and designs, created by Seller or any other person or entity retained or employed by Seller, and used with Buyer's Intellectual Property, shall be works made for hire within the meaning of the United States Copyright Act and shall be the property of Buyer who shall be entitled to use and license others to use such material, subject to the provisions of the Agreement and unencumbered by moral rights. To the extent any Intellectual Property is not a work made for hire or rights in the materials do not automatically accrue to Buyer, Seller irrevocably assigns and agrees to assign to Buyer, its successors and assigns, the entire right, title and interest in perpetuity throughout the world in and to any and all rights, including all copyrights and related rights in such Intellectual Property, which Seller and the author of such Intellectual Property warrant and represent as being created by and wholly original with the author. Where applicable, Seller agrees to obtain any other assignments of rights in the Intellectual Property from the author or third parties in favor of Buyer, its successors and assigns. Notwithstanding the foregoing, to the extent any Goods are "off the shelf", "market body", non-proprietary, or otherwise not original designs, then the above work made for hire provision shall not apply.

f. Seller agrees to incorporate into its agreements with its direct and indirect vendors, contractors, subcontractors and suppliers, and to enforce for its benefit and the benefit of Buyer the terms of this Section. Seller agrees that any breach of this Section shall constitute a material breach.


21. Term, Termination and Remedies.

a. The Agreement will remain in effect until terminated by any party on at least 90 days written notice to the other party. No such termination will operate to relieve any party of its obligations under any contract created hereunder, whether or not such contract was fully performed at the time of termination, except as specifically set forth below.

b. Buyer (acting for itself or through Buying Agent), or Seller shall have the right with respect to the other to terminate immediately the Agreement and/or any contract created under the Agreement, in whole or in part, without liability, should the other become insolvent or make a general assignment for the benefit of creditors. Buyer shall have the additional right to terminate immediately the Agreement and/or any contract created under the Agreement, in whole or in part, without liability, should any of the following occur: Seller defaults in any material respect in the performance of its obligations under the Agreement or under any contract created under the Agreement; or Buyer has reasonable grounds for insecurity with respect to Seller's performance and has not received reasonable assurance of due performance within five days after written demand therefore.

c. Buyer (acting for itself or through Buying Agent) shall have the right, without liability, to cancel immediately all current and outstanding orders, whether or not in the process of manufacture, and to reject any orders or revoke acceptance of orders previously accepted, should any of the following occur:

(1) Seller, or any of its vendors, contractors, subcontractors or suppliers fails to perform any obligation required under Addendum No. 2 hereof;

(2) After inspection of the facilities or records of Seller, or any of its vendors, contractors, subcontractors or suppliers as permitted hereunder, Buyer or Buying Agent is unable to verify to its satisfaction compliance with Laws and Regulations or Labor Standards, including without limitation United States laws, statutes, codes and/or regulations relating to the country of origin of or labor standards applicable to Goods produced for or sold to Buyer, or;

(3) Seller, or any of its vendors, contractors, subcontractors or suppliers have failed to take appropriate security measures, or;

(4) Seller, or any of its vendors, contractors, subcontractors or suppliers is determined not to be in compliance with or to have violated any Laws and Regulations or Labor Standards, including without limitation laws, statutes, codes and/or regulations relating to the country of origin of or labor standards applicable to Goods produced for or sold to Buyer, or the laws, statutes, codes and/or regulations of any country or countries wherein any portion of Goods contracted for by Buyer are to be manufactured, or appears on a CBP list of targeted companies or suspected violators of U.S. import laws or has been subject to any detention notice by CBP.

d. Buyer (acting for itself or through Buying Agent) shall also have the right, without liability, to cancel immediately any contract if Seller or any Goods are not in compliance with the Agreement, and to reject or revoke acceptance of any orders previously accepted, that are not, or that have not been produced or delivered, in compliance with the Agreement.

e. In the event of a termination, cancellation, rejection or revocation of acceptance by Buyer or Buying Agent pursuant to Sections 21.b., 21.c., or 21.d. above, Seller shall not be entitled to any payment, but shall be obligated to indemnify and reimburse Buyer and Buying Agent for all expenses, claims, fees (including but not limited to reasonable attorneys’ fees, other professional fees and other costs and expenses), losses (including losses of profit and losses of quota), penalties, costs and damages suffered by Buyer. Seller shall immediately return to Buyer all patterns, graded specs, markers, and other items provided by Buyer to Seller for production of the Goods. Buyer shall be entitled to set-off any or all of the foregoing against any monies then owing, or claimed to be owing, by Buyer or its agents to Seller. The provisions of this Section shall not limit, and shall be in addition to rather than in lieu of, the indemnification provisions set forth in Section 17.a. hereof.

f. If applicable, Seller shall promptly refund the total of the Landed Duty Paid value of any Goods which are found to be defective under normal use within a period of six months after the Goods have been sold to Buyer’s customers, together with the amount of any claims for losses, damages,


expenses and charges. The provisions of this Section shall not limit, and shall be in addition to rather than in lieu of, the indemnification provisions set forth in Section 17.a. hereof.

g. All remedies conferred hereunder will be cumulative and without prejudice to and in addition to any other rights and remedies available at law and in equity.

22. Survival of Representations and Warranties.

All of Seller's representations, warranties, indemnities and other undertakings, and Buyer's and Buying Agent's rights and remedies under the Agreement, will survive the termination of the Agreement, the termination of any contract created under the Agreement, and any inspection, testing, acceptance, payment or use of the Goods provided under the Agreement. Such representations, warranties, indemnities and undertakings, rights and remedies will inure to the benefit of Buyer and Buying Agent and their respective parent companies, affiliates, directors, officers, members, employees, agents, successors, assigns and customers. 23. Limitation of Liability.

Under no circumstances will Buyer be liable to Seller as a result of any cancellation of any contract or otherwise for any amount in excess of the purchase price set forth in any contract for Goods. Seller shall be required to mitigate its damages. ALL CLAIMS FOR INCIDENTAL, SPECIAL, EXEMPLARY, INDIRECT OR CONSEQUENTIAL DAMAGES, WHETHER BASED UPON THEORIES OF CONTRACT, TORT, OR OTHERWISE, ARE HEREBY WAIVED BY SELLER. 24. Assignment; Successors.

Seller will neither assign the Agreement nor any contract created under the Agreement nor subcontract any work hereunder without the prior written approval of Buyer (or Buying Agent acting on its behalf) and no permitted assignment or subcontracting will relieve Seller of its obligations hereunder. Any subcontract shall incorporate the relevant provisions of this Agreement. The Agreement will be binding upon and will inure to the benefit of the parties and their respective successors and assignees. 25. Severability.

The invalidity of any provision of the Agreement will not render invalid any other provision, it being the intention of the parties that the terms hereof will be construed in such fashion as to make all of such provisions valid and enforceable to the full extent permitted by applicable law. 26. Waiver.

No failure or delay on the part of Buyer or Buying Agent to exercise any right, privilege or power under the Agreement shall operate as a waiver or relinquishment thereof; nor shall any single or partial exercise by Buyer, or Buying Agent acting on its behalf, preclude any other or further exercise thereof, or the exercise of any other right, privilege or power. 27. Governing Law; Consent to Jurisdiction; Venue.

The Agreement will be governed by and construed in accordance with the local laws of the Commonwealth of Pennsylvania, USA, or with the laws of Hong Kong, as selected by Buyer in its reasonable discretion, without reference to the conflicts of laws principles of such chosen jurisdiction. The Seller hereby consents to the jurisdiction and venue of the courts of proper subject matter jurisdiction located in Bucks County, Pennsylvania, USA, or the courts of Hong Kong, as selected by Buyer, in respect of any claim or matter arising under this Agreement or any contract created hereunder. Service of any process, summons, notice or document by written means pursuant to Section 28 below shall be effective service of process for any action, suit or proceeding brought against any party hereunder in any such courts. The United Nations Convention on Contracts for the International Sale of Goods shall have no application to the Agreement or actions hereunder or contemplated hereby. 28. Notices.

Any notice required or permitted under the Agreement shall be given at the respective addresses for the parties indicated on the signature page of the Agreement and in Addendum No. 4 to the Agreement (or as subsequently changed in a notice) by any commercially reasonable written or electronic means and, unless otherwise specified by the protocol adopted hereunder, will be deemed given when delivered in person, when electronic delivery is confirmed, or when delivered by any reputable courier service.


29. English Language.

All notices, records, and other documentation to be delivered to or by Buyer or Buying Agent hereunder shall be delivered in English. If the Agreement should exist in counterparts in more than one language, the English language version shall be the official version.

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ADDENDUM NO. 2

CERTIFICATION OF COMPLIANCE WITH CHARMING SHOPPES, INC. CODE OF CONDUCT, LAWS AND REGULATIONS AND LABOR STANDARDS

I. OBLIGATIONS

A. Seller certifies that, with respect to the manufacture of all Goods (as defined in Addendum No. 1) all production facilities and processes, conditions of employment and accommodations made available for workers, currently comply and will continue to comply with Laws and Regulations, and with Charming Shoppes, Inc.'s most current Code of Conduct, which is hereby incorporated into the terms and conditions of this Agreement (collectively, “Labor Standards”). Seller acknowledges that it is responsible to assure compliance with all of Charming Shoppes, Inc.'s Code of Conduct Standards and all Labor Standards by all subcontractors, suppliers, factories or other facilities (collectively, “Suppliers”) that participate in the manufacture of the Goods.

B. Labor Standards shall include, without limitation, the following actions and commitments to be undertaken for purposes of implementing and monitoring compliance therewith. 1. Non-Interference There shall be no effort to interfere with, discourage or punish workers’ efforts to

communicate with Buyer or Buying Agent or their representatives, concerning compliance with this Certification or Suppliers’ obligations hereunder. Buyer, Buying Agent and their representatives shall be permitted to interview workers without the participation or overhearing of other employees or management, and without requiring workers to leave their work stations for the interview. The confidentiality and anonymity of such interviews shall not be infringed upon, undermined or disrupted.

2. Management Awareness and Training All managerial employees shall be educated respecting Suppliers’ obligations to Buyer

and Buying Agent under this Certification. Managerial employees shall attend seminars or other training programs as requested by Buyer, Buying Agent or their representatives.

3. Worker Awareness and Education

Workers shall be educated respecting Suppliers’ obligations under this Certification. Charming Shoppes, Inc.'s Code of Conduct and local Labor Standards shall be translated into languages understood by all workers and posted in a clear and conspicuous manner in all facilities in which the Goods are manufactured. Posted information shall include a telephone number and/or address of Buyer or Buying Agent or a representative thereof who can be contacted in the event of problems or questions. Buyer or Buying Agent shall have the right to have other, additional information distributed to workers.

4. Recordkeeping

A record shall be maintained of the name, age, hours worked and wages and benefits paid for each worker for the preceding five-year period, defined as at least five (5) years from the date of assembly for non-textile and non-apparel goods, the date of cutting for cut-and-sewn Goods and the date of panel-knitting for knit-to-shape Goods. Each document in respect of any Goods must contain the date on which it was generated. Seller hereby represents and warrants and shall ensure that the information contained in the documents is accurate, and Seller shall provide an English translation of the documents. Recordkeeping requirements are subject to all terms and conditions as set forth in this Master Sourcing Agreement and Charming Shoppes, Inc.'s Code of Conduct. Such records shall be immediately available to Buyer, Buying Agent and their representatives upon request.

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ADDENDUM NO. 2 (continued)


I. OBLIGATIONS (continued) 5. Access For the purpose of monitoring compliance with this Certification, Buyer, Buying Agent

and their representatives shall have the right of unrestricted access to all production facilities and dormitories, and to all relevant records, whether or not notice is provided in advance.

C. For purposes of this Certification, Buyer’s affiliates, agents, representatives, and employees shall

enjoy the same rights, benefits and privileges as Buyer.

D. Seller understands that the issuance of any subsequent orders or contracts to Seller by Buyer is made in reliance upon Seller's compliance with this Certification and its representation and warranty that this Certification is fully accurate and complete and that Seller and the Suppliers are fully in compliance with its terms.

II. CERTIFICATION

A. Seller agrees that it will comply with and will continue to comply fully with and will ensure the

compliance by the Suppliers with all Labor Standards and Charming Shoppes, Inc.'s Code of Conduct, and that all Goods delivered to Buyer pursuant to or in connection with any contracts or purchase orders issued by Buyer or through Buying Agent will be produced in compliance with all applicable Labor Standards and Charming Shoppes, Inc.'s Code of Conduct.

B. Seller agrees that it will keep in its possession Charming Shoppes, Inc.'s Code of Conduct and

Labor Standards and understands that when an audit is conducted, compliance with all aspects of the Labor Standards is a condition of a satisfactory audit result.

C. Seller agrees that it shall be solely responsible for the payment of all wages, fringe benefits, social

security, unemployment and similar taxes applicable to the performance of services pursuant to or in connection with any contracts or purchase orders issued by Buyer. Seller agrees to procure and maintain in effect and will ensure the procurement and maintenance in effect by the Suppliers of the full coverage required under applicable law for workers' compensation, employer's liability and disability insurance for all of its and their employees.

D. Seller agrees to incorporate into its agreements with its direct and indirect vendors, contractors,

subcontractors and suppliers, and to secure and enforce for its benefit and the benefit of Buyer and Buying Agent, the terms of this Addendum.

III. BREACH

Seller agrees that any determination by a government regulatory authority of a violation by Seller of any Labor Standards shall constitute a material breach by Seller of this Certification and any contracts or purchase orders issued by Buyer or through Buyer’s designated Buying Agent to Seller. Seller agrees to immediately notify Buyer or the designated Buying Agent of such determination by a government regulatory authority. Seller also agrees that any other failure by Seller to comply with any Labor Standards or Charming Shoppes, Inc.'s Code of Conduct, including failures that Buyer or Buying Agent may become aware of through the results of a workplace or dormitory inspection or other reliable information, shall also constitute a material breach by Seller of this Certification and any contracts or purchase orders issued by Buyer or through Buying Agent to Seller. Any such material breach shall entitle Buyer at its option (and in addition to other remedies available), to retain any amount owed to Seller and absolve Buyer of payment obligations under any outstanding contracts or purchase orders.

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ADDENDUM NO. 2 (continued)


IV. OTHER REMEDIES Seller acknowledges that a breach of this Certification could render it liable for any and all damages, including without limitation actual, special, incidental, consequential and punitive damages that such breach may cause, or any other damages that might be awarded under applicable law. V. DESIGNATION Seller shall immediately designate one or more officials of Seller as the responsible official for compliance with Labor Standards and notify Buyer or Buying Agent of the identity, title, address, phone and fax number of such official. Seller shall promptly notify Buyer or Buying Agent of any change in the identity of the official designated for this purpose.

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ADDENDUM NO. 3

SELECTED LAWS

The Laws and Regulations shall include all applicable laws, statutes, rules, regulations, codes, standards, requirements and ordinances of all applicable jurisdictions, including those in which manufacturing, production, labeling, packaging, distribution and selling of Goods is anticipated to or does occur and those from which raw materials, components or ingredients thereof may be obtained, including those related to the conditions or process of their manufacture, whether or not specifically referred to herein and whether relating to product content or quality, safety, country of origin, environmental matters, safety conditions in the work environment, labor standards, or otherwise, including without limitation, the following: the Consumer Product Safety Improvement Act, the Clean Air Act, the Fair Labor Standards Act, the Fair Packaging and Labeling Act, the Flammable Fabrics Act, the Lanham Act, the Food, Drug and Cosmetic (FDA) Act, the Fur Products Labeling Act, the Hazardous Substances Act, the Poison Prevention Packaging Act, the Textile Fiber Products Identification Act, the Wool Products Labeling Act, the Endangered Species Act, the Foreign Corrupt Practices Act, the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism (USA Patriot Act), Proposition 65 of the State of California (The Safe Drinking Water and Toxic Enforcement Act of 1986, California Health and Safety Code Section 25249.5, et seq.), the Proposition 65 List of Chemicals, all requirements of the U.S. Federal Trade Commission, the Bureau of Customs and Border Protection of the Department of Homeland Security of the United States of America, (including any voluntary program such as C-TPAT), or any other governmental authority having jurisdiction over the subject matter of any contract under the Agreement, any free trade agreements bilaterally entered into by the United States of America and another country or countries, special duty programs provided for by acts of the U.S. Congress, and the Hong Kong Prevention of Bribery Ordinance. Buyer reserves the right to amend these requirements and deliver additional requirements regarding the Laws and Regulations, and Seller agrees to comply with the amended and additional requirements.

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ADDENDUM NO. 4

BUYER NOTICE ADDRESSES

Any notice required or permitted under the Agreement as to Buyer shall be given to:

Charming Shoppes, Inc. 450 Winks Lane Bensalem, PA 19020 U.S.A. Attn: Director International Trade and Compliance

Any notice required or permitted under the Agreement as to Buying Agent shall be given to the Buying Agent (if applicable) at the address identified in the Buying Agent section of the signature page to this Agreement.

In addition, any notice required or permitted to be given pursuant to Sections 21.a or 28 of Addendum No. 1 of the Agreement, shall be given to: Charming Shoppes, Inc. 450 Winks Lane Bensalem, PA 19020 USA Attn.: Legal Department

Any of the above notice addresses may be changed by a subsequent notice in accordance with the terms of this Agreement.

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ADDENDUM NO. 5

MODIFICATIONS FOR SELLERS USING NATIONALLY RECOGNIZED BRAND LABELS OWNED BY SELLER

1. The Factory Identification clause contained in Addendum NO. 1 is hereby amended as follows:

The requirement to register and obtain a factory ID for each factory used to produce merchandise is hereby waived and the requirement to place a factory ID on the legally required fiber content label is waived provided:

a. the garment label is a nationally recognized label; b. Vendor has a program in place within their own organization to identify where merchandise is

produced and; c. Vendor certifies that it has a program in place to ensure all factories used to produce nationally branded

merchandise sold to Buyer, adhere to the terms and conditions of Buyer’s most current Code of Conduct.

d. Buyer has confirmed in writing that the conditions of this waiver apply. 2. The Intellectual Property Clause in Addendum NO. 1 is hereby amended by adding the following:

Seller represents that the purchase evidenced by the contracts, subsequent sale by Buyer to customers, or use of the Goods purchased by customers do not infringe any patent, trademark, copyright or any other intellectual property rights. In the event the Goods are the subject of legal action against Buyer by reason of patent, trademark or copyright infringement or similar claims, Seller shall indemnify and hold Buyer harmless from any and all liability by reason of such infringement and shall assume all costs and expenses, including attorneys’ fees, in connection therewith. Buyer may return remaining Goods at Seller’s expense. Seller shall reimburse Buyer the cost of said returned Goods, in addition to any expenses, losses, costs and damages, including without limitation attorneys’ fees incurred by Buyer related to said infringement or the return of Goods. Buyer may reduce any current or future balances due Seller for such sums. If Buyer has directed that any of its trademarks or price tickets are to be affixed to the Goods, such permission is expressly limited to the Goods sold pursuant to the contract. Seller may not sell or dispose of any Goods bearing Buyer’s trademarks or price tickets, including Goods which are not accepted or are rejected by Buyer. All such trademarks and price tickets must be removed prior to disposal by Seller in accordance with Buyer’s written policies regarding disposition.

3. Buyer’s Label and Marketing Manual (“Label Manual”) is hereby amended as follows: Trims associated with a national branded label may differ from the Label Manual guidelines. Placement of trim items may vary and therefore Seller shall provide, on a case by case basis, Buyer’s Buying and Merchandise Operations Departments with correct information as to placement of all trim items. Exceptions to Label Manual Guidelines shall be detailed in purchase order. Unless otherwise instructed, all Goods are to be pre-ticketed and are required to have main and care label permanently affixed to the garment. Failure to attach price tickets and labels will result in refusal of Goods by Buyer at Seller’s expense, or Buyer may chargeback Seller in accordance with Buyer’s chargeback policy. Seller must verify that the price ticket information matches the purchase contract. The color code must match the color of the Goods. The labels must contain the following: Fabric Content, Size Information, County of Origin, Branded Vendor RN#, and Care Instructions. The country of origin must be on the front side of the label and the label cannot be obscured by any other label and must be placed in the garment in accordance with the requirements of the Federal Trade Commission and the CBP. Buyer’s purchase contract requires that all label/trim costs be included by the Seller in the prices in any contract(s) created under this Agreement.

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ADDENDUM NO. 6

Electronic Data Interchange (EDI) Trading Partner Agreement Buyer, Buying Agent acting on behalf of Buyer if applicable, and Seller agree that contracts for the purchase and sale of goods may be created and implemented using EDI technology. It is agreed as follows: 1. Seller’s participation in the Buyer’s (or, as applicable, Buying Agent’s) EDI programs will be subject to the

EDI Implementation Guide and Transaction Set Mapping Documentation as provided for under the EDI Section of the VPM on Buyer’s website (“Site”).

2. Each party may electronically transmit to or receive from the other those electronic data interchange ("EDI")

transaction sets as identified under the EDI Section of the Site. Buyer (or Buying Agent if applicable) at its discretion, may add or delete transaction sets from the Site. Posting of changes to the Site, to which Seller has been given access, shall be deemed sufficient notice to Seller of such changes.

3. Seller shall implement and maintain appropriate administrative, technical and physical practices and safeguards,

including but not limited to encryption and virus/spyware scanning, which are designed to (i) ensure the security, confidentiality and integrity of all information transmitted between the parties, whether transmitted electronically or in other forms and no matter how such information is stored, retained, maintained, saved, or held, and (ii) protect against the unauthorized use, destruction, modification or disclosure of electronic information. Seller shall implement and maintain a business continuity or disaster recovery plan to protect against anticipated or unanticipated threats to or loss of electronic information. Seller shall immediately notify Buyer as soon as Seller learns or reasonably suspects that there is any problem or potential problem regarding the security, confidentiality, or integrity of any electronic information, or any unauthorized use, destruction, modification or disclosure thereof. Seller shall take action to stop the unauthorized use of compromised information and to remedy any such unauthorized use. Seller shall make notification of compromised electronic information to the Buyer's EDI Department at:

[email protected]

and

Charming Shoppes, Inc. 450 Winks Lane Bensalem, PA 19020 USA Attn: Director, International Trade and Compliance


Each party has the right and is expected to make an emergency termination of EDI operations if necessary to protect resources from illegal access or unauthorized use, destruction, modification or disclosure. The party terminating the operations shall notify the other party of such termination as soon as reasonably possible and restore services as soon as reasonably possible thereafter. Such termination of EDI operations shall not constitute termination of this Agreement.

4. Documents will be transmitted electronically to each party either directly, via the internet, or through any third

party service provider (“Provider”). Each party is responsible for the selection of its Providers and either party may modify its selection, provided it provides no less than thirty (30) days prior written notice to the other party of such modification in order to ensure transition of electronic data is supported. Seller is responsible for investigating and selecting those EDI options and Providers that are deemed best by Seller for its business. Any Provider must agree to be bound by the obligations that are imposed in this Addendum, including but not limited to those regarding security, data integrity and confidentiality.

5. Each party, on its own, shall be responsible for the costs of any Provider with which it contracts and shall be

liable for the acts or omissions of its selected Provider while transmitting, receiving, storing or handling EDI transactions or performing related activities on its behalf. In the event that both parties use the same Provider to

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perform the transmission and receipt of EDI transaction sets, the originating party shall be liable for acts or omissions of the Provider with respect solely to the EDI transaction set document being transmitted. Each party, at its own expense, will provide and maintain the equipment, software, services and testing necessary to effectively and reliably transmit and receive EDI transaction sets.

6. The receiving party will be required to transmit a Functional Acknowledgement (“997” EDI transaction set

document) within 24 hours of receipt of the original EDI transaction set document. It is the originator’s responsibility to monitor transmissions for overdue Functional Acknowledgements. The Functional Acknowledgement will constitute conclusive evidence that an EDI document has been properly received. No message may be considered received or enforceable until received as evidenced by a “997”. Neither party will be responsible for a communication received from the other party in unintelligible or garbled form, provided the receiving party gives prompt notice to the originating party (if identifiable from the received document) of any such occurrence.

a. The originating party is responsible and liable for the completeness and accuracy of the EDI

transaction sets sent. The receiving party must promptly notify the originating party of any transmission error that is reasonably obvious to the receiving party, in order to enable the originating party to take corrective actions.

b. Where there is evidence that an EDI transaction set has been corrupted or if any EDI transaction set is

identified or capable of being identified as incorrect, it shall be promptly retransmitted by the originating party. Each party shall use commercially reasonable efforts to identify and properly address duplicative communications.

c. If the receiving party has reason to believe that a communication is not intended for it, the receiving

party shall take reasonable action to promptly notify the originating party. Upon receipt of confirmation from originating party that the communication was not intended for the receiving party, the receiving party shall delete information contained in the communication from its systems.

7. It is required that Seller resolve all discrepancies between the most recently transmitted 850 (Purchase Order)

and the anticipated 856 (Advance Ship Notice) transaction set document and against the actual shipment to be made prior to the transmission of the 856 document. Discrepancies identified between the 850 and the 856 documents and/or the 856 document and the physical shipment could result in chargebacks as stipulated in the VPM.

8. It is required that Seller resolve all discrepancies between the most recently transmitted 850 (Purchase Order)

and the anticipated 810 (Commercial Invoice) transaction set document prior to the transmission of the 810 document. The payment terms and item cost as listed in the most recently transmitted 850 transaction set document to Seller will govern what is paid against the 810 (Commercial Invoice) transaction set document should discrepancies be identified between the two transaction set documents at the time the 810 transaction set document is received. Buyer will not accept a zero balance due 810 transaction set document via EDI.

9. If changes are made to the purchase order, Buyer will issue a new full replacement purchase order. Buyer will

not transmit a purchase order transaction set (850) with changes only. Should a purchase order with changes only be received, they are to be disregarded as a duplicate. DOUBLE SHIPMENTS MADE AGAINST A DUPLICATE 850 TRANSACTION SET WILL BE REJECTED AND THE RETURN WILL BE THE RESPONSIBILITY OF THE SELLER.

Concerns or issues with EDI transmissions or transaction sets or the Master Sourcing Agreement are to be reported to:

Charming Shoppes, Inc. 450 Winks Lane Bensalem, PA 19020 U.S.A. Attn: Director International Trade and Compliance
