WILTON INDUSTRIES, INC. DOMESTIC VENDOR BUSINESS GUIDE...

2015 DOMESTIC VENDOR BUSINESS GUIDE

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WILTON INDUSTRIES, INC.

DOMESTIC VENDOR BUSINESS GUIDE

MAY 2015


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1 WILTON DOMESTIC VENDOR BUSINESS GUIDE - INTRODUCTION ....................................... 4

2 GLOSSARY ..................................................................................................................................... 5

3 BUSINESS PRACTICE AND CODE OF CONDUCT ...................................................................... 7

3.1 BUSINESS PRACTICE ................................................................... ERROR! BOOKMARK NOT DEFINED.

3.2 WILTON CODE OF CONDUCT .......................................................................................................... 7

3.3 VENDOR LEGAL COMPLIANCE POLICY ............................................................................................ 9

3.4 PRODUCT SAFETY AND QUALITY COMPLIANCE POLICY .................................................................. 12

3.5 BARCODE VERIFIER COMPLIANCE POLICY .................................................................................... 16

4 PURCHASE ORDER GUIDELINES .............................................................................................. 16

4.1 WILTON STANDARD PURCHASE AGREEMENT AND CONDITIONS ...................................................... 16

4.2 FORECASTS AND LONG LEAD TIME MATERIALS; APPROVED VENDORS ........................................... 23

4.3 SAMPLE PURCHASE ORDER ......................................................................................................... 25

4.4 VENDOR INVOICING AND PAYMENT PROCEDURES ......................................................................... 26

5 TRANSPORTATION AND ROUTING ........................................................................................... 27

5.1 CARRIER SELECTION ................................................................................................................... 27

5.2 DELIVERY APPOINTMENTS ........................................................................................................... 29

6 GENERAL SHIPPING GUIDELINES ............................................................................................ 29

6.1 CARTON PACKAGING REQUIREMENTS .......................................................................................... 29

6.2 PALLETIZING……………………………………………………………………………………………42

6.3 PARCEL AND PALLET SHIPPING LABELS ........................................................................................ 51

6.4 TRAILER LOADING ....................................................................................................................... 53

7 DESIGN SOFTWARE .................................................................................................................... 55

7.1 ADOBE CREATIVE SUITE (CS4) .................................................................................................... 55

8 NON-COMPLIANCE AND CHARGE BACKS .............................................................................. 56

8.1 PROCESS OVERVIEW ................................................................................................................... 56

8.2 SAMPLE VENDOR COMPLIANCE CHARGEBACK .............................................................................. 57

8.3 COST RECOVERY CHARGEBACK SCHEDULE ................................................................................. 58

9 VENDOR QUALITY ASSURANCE ............................................................................................... 61

9.1 PRODUCT SPECIFICATIONS AND QUALITY ..................................................................................... 61


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9.2 TOOLS ........................................................................................................................................ 63

9.3 PRODUCT INSPECTIONS ............................................................................................................... 64

9.4 SUSPECT SHIPMENTS AND PRODUCT REWORK ............................................................................. 66

10 MATERIAL SAFETY DATA SHEETS (MSDS) ............................................................................. 66

11 PEST INFESTATION ..................................................................................................................... 66

11.1 DOMESTIC SHIPMENTS ................................................................................................................ 66

12 WILTON CONTACT LIST AND ADDRESSES ............................................................................. 67

13 WILTON FORMS FOR VENDOR USE ......................................................................................... 68

13.1 VENDOR FACT SHEET / ADDRESS FORM ....................................................................................... 68

14 VENDOR GUIDE APPENDICES ................................................................................................... 69

14.1 APPENDIX A - UPC-A BAR CODE GUIDELINES .............................................................................. 69

14.2 APPENDIX B - SCC-14 (INTERLEAVED 2-OF-5) BAR CODE GUIDELINES.......................................... 71

14.3 APPENDIX C – MODULO-10 CHECK DIGIT CALCULATION ............................................................... 73

14.4 APPENDIX D – UPC SYMBOL SPECIFICATION SYMBOL DIMENSIONS AND TOLERANCES ................... 74

14.5 APPENDIX E – UPC SYMBOL OPTICAL CHARACTERISTICS ............................................................. 75

14.6 APPENDIX F – MODULO 103 CHECK DIGIT CALCULATION .............................................................. 76

14.7 APPENDIX G – VENDOR COMPLIANCE CERTIFICATE ...................................................................... 77


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1 WILTON DOMESTIC VENDOR BUSINESS GUIDE - INTRODUCTION

All of us at Wilton Industries, Inc., and its affiliates (“Wilton”) welcome you as a valued vendor (sometimes referred to as “you” or the “Vendor”). The Wilton portfolio consists of leading brands in each category including Wilton®, Copco®, EKSuccess Brands®, Jolee’s Boutique®, K&Company®, Dimensions®, Perler®, Sticko®, Inkadinkadoo®, Simplcity®, Wrights® and Boye®. We at Wilton place the utmost importance on our vendor relationships and have built strong partnerships with best in class suppliers worldwide. We are pleased to have you as one of our valued partners and present our Wilton Domestic Vendor Business Guide, which also includes the Wilton policies and procedures referenced in this Wilton Vendor Business Guide (the Wilton Domestic Vendor Business Guide and such Wilton policies and procedures referenced in this Wilton Vendor Business Guide, as amended from time to time, is referred to as the “Vendor Business Guide”) to clearly outline our policies and procedures necessary to ensure compliance with all requirements of Wilton. If at any time the Vendor is unable to comply with any sections of this Vendor Business Guide the Vendor must contact Wilton at once to rectify the situation. Any non-compliance issues will require written approval from the Senior Vice President of Global Sourcing and Procurement. Each Vendor shall execute and deliver the Compliance Certificate attached hereto as Appendix G. Amendments or modifications to this Vendor Business Guide will be provided as needed and will be conveyed to the Vendor along with any applicable dates for compliance. THIS VENDOR BUSINESS GUIDE IS SUBJECT TO AMENDMENT FROM TIME TO TIME BY WILTON IN ITS SOLE DISCRETION. WILTON SHALL MAKE AVAILABLE TO THE VENDOR THE AMENDED VENDOR BUSINESS GUIDE. THE VENDOR’S CONTINUED PERFORMANCE SHALL BE DEEMED ITS CONTINUING CONSENT TO THE VENDOR BUSINESS GUIDE, AS AMENDED. THE MOST CURRENT VERSION OF THIS VENDOR BUSINESS GUIDE SHALL ALWAYS BE USED AND PRIOR VERSIONS DISCARDED. Wilton has established representatives to address specific Vendor questions in the areas of Inventory, Transportation, and Product Management. These and other representatives are detailed in the Wilton Contact List in Section 12 of this Vendor Business Guide. Thank you for your cooperation and welcome to the Wilton family.


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2 GLOSSARY

Certain definitions used in the Vendor Business Guide are set out below. Other terms area defined in the other sections of the Vendor Business Guide. APHIS Animal and Plant Health Service, a division of the United States Department of Agriculture. Associate Individuals under employment of Wilton and its affiliates. Chargeback A fee charged to the Vendor by Wilton for processing costs associated with handling and correcting shipments that are not in accordance with this guideline. Collect Indicates that the freight charge is payable by the consignee (recipient) of the freight. Corrugated A carton material built of layers of one or more fluted (or wavy) sheets of paper material sandwiched between two or more outer paper sheets. The alternative to corrugate is flat board, which does not have any flutes. Intellectual Property US or foreign, trade names, trademarks, logos, brand names, model names and other identifying markings, trade dress, visual design, copyrights, inventions, innovations, designs, plans, specifications, drawings, materials, components, and patent rights or the like, and the other intellectual property rights and all improvements, modifications and enhancements to the foregoing Legal Requirements All applicable laws, rules, regulations, policies, procedures, standards and orders, of whatever kind and nature and of all applicable governmental and industry bodies, now or hereafter in effect, relating to the manufacture and supply of the Products in the country of origin and the country of ultimate sale to consumers, including, but not limited to, (i) labor laws including the Fair Labor Standards Act ("FLSA") (if the Vendor is a company subject to the FSLA), (ii) all environmental laws, (iii) all United States federal, state, and local governmental requirements, including the Federal Food, Drug and Cosmetic Act, California Health and Safety Code Section 252249.6 et. seq, (known as California Prop 65), and the Consumer Products Safety Improvement Act of 2008, in each case if applicable; (iv) all Canadian federal, provincial and local governmental requirements, including applicable Health Canada regulations for Products to be sold in Canada, if applicable; (v) European Union governmental requirements and directives for Products to be sold in Europe, if applicable; and (vi) any other comparable laws and regulations of any country or subdivision thereof to which the Products are intended to be sold to consumers; the HACCP System and Guidelines, if applicable, Underwriters’ Laboratories (“UL”) and Canadian Standards Association (“CSA”), if applicable, and any other applicable industry body standards.


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Losses All liabilities, losses, claims, damages, settlement costs, demands, fines, civil penalties, judgments, and expenses (including, but not limited to, interest, court costs and attorneys’ fees and costs of investigation).

OSHA Occupational Safety and Health Act Pre-paid Indicates that the freight charge is payable by the shipper of the freight. Print Contrast Signal (PCS) A measurement of the ratio of the reflectivity between the bars and spaces of a symbol. PCS is calculated by the reflectivity of the background minus the reflectivity of the bars, divided by the reflectivity of the background. Products Items ordered from the Vendor by a Purchase Order. Quality Standards All quality assurance procedures and standards specified in writing by Wilton from time to time, including in this Vendor Business Guide. The Quality Standards includes use of only accredited testing facilities that have been approved by Wilton in writing. SCC Shipping Container Code, a code used for Inner and Master Packs (SCC-14) and is governed by the Uniform Code Council (UCC). The SCC is also used for items shipped (SCC-18) under the requirements of Electronic Data Exchange (EDI). SKU Stock Keeping Unit, the smallest unique sellable retail unit. Straight Bill of Lading A non-negotiable receipt and carriage contract from the carrier to the shipper for the goods received for transportation. The Straight Bill of Lading contains information on the shipment goods, the consignee (recipient of the shipment), the shipper, and the carrier.


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3 BUSINESS PRACTICE AND CODE OF CONDUCT

3.1 RESERVED

3.2 WILTON CODE OF CONDUCT

Wilton has created a Mission Statement and a set of Core Values that serves as a guide to define who we are as a company. Mission Statement Create innovative, trend right, branded products of superior quality and value that meet consumers’ needs to creatively express themselves and celebrate life’s events. Core Values

Operate with the highest ethical standards.

Foster a compelling desire to improve and win in the marketplace.

Nurture relationships with customers and suppliers to ensure mutual success.

Provide a work environment where associates are inspired to create and excel.

Be good stewards in our communities and of our environment. Wilton has a Code of Conduct that reinforces the principles behind the Mission Statement and Core Values. The Code of Conduct sets the standards by which we conduct our professional lives and is intended to be a tool and a guide to help employees, as well as others who act on our behalf, to understand and fulfill their responsibilities in relation to our internal policies and procedures, our standards for ethical and proper behavior, and laws and regulations applicable to the Company and to the roles and responsibilities of each employee.

1. The Code of Conduct requires that Wilton maintain a safe workplace where employees are free from harassment and not discriminated against and have equal opportunity.

2. The Code of Conduct requires that Wilton Associates safeguard company assets, including

confidential information and intellectual property. 3. The Code of Conduct also requires that Wilton, its products and its Associates comply with all

applicable laws. These laws include laws regarding the safety of products, antitrust laws, anti-boycott laws and import and export laws. These laws also include anti-bribery laws.

a. The Code of Conduct prohibits the offering or paying of money or anything else of value, or

accepting or agreeing to accept money or anything of value as part of a bribe, to induce improper conduct or to influence an act or decision by a government official.

b. Gifts or entertainment are restricted. Wilton associates may not pay for or receive excessive

entertainment or gifts over $50. Charitable and political contributions are also prohibited unless approved by the Chief Executive Officer and the General Counsel.


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4. The Code of Conduct also prohibits Wilton associates (and their family members*) from engaging in activities outside of the workplace that create or could potentially create a conflict of interest. Examples of conduct that may give rise to a conflict of interest include:

a. Employment in any capacity by a competitor, supplier, customer or service provider of Wilton. b. Direct or indirect ownership of any such competitor, supplier, customer or service provider.

“Direct or indirect ownership” includes any ownership interest, even through an intermediary. c. Accepting gifts, entertainment, or anything else of value for the purposes of a bribe, obtaining

or retaining business, , obtaining or rewarding favorable treatment or inducing improper conduct in connection with this Vendor Business Guide or in connection with the provision of goods or services to Wilton or its affiliates. .

d. Having a financial interest in any transaction involving the purchase or sale by Wilton of any goods, materials, equipment, supplies, services or property.

e. Use of non-public, privileged or confidential information the personal gain of an employee or the disclosure of such information to any person not expressly authorized to receive it.

f. Using employees, materials, equipment or other assets of Wilton for personal gain. g. Involvement in any other business activity, transaction or relationship which could reasonably

be interpreted by others as illegal or unethical conduct or in conflict with the interests of Wilton. h. Acceptance by an employee of an offer to serve as an officer, director, partner, consultant or

employee of competitor, customer, franchisee or any supplier or potential supplier without disclosure and prior written approval from the President.

i. “Family members” include an employee’s spouse, child, sibling or other persons living in the same household.

Reporting If a Vendor becomes aware of any violation of the Wilton Code of Conduct by a Wilton Associate, the Vendor should report such violation to any one of the following individuals: James Hill Executive Vice President, Global Operations Tel: 630-810-2360 Email:[email protected] Ahna Severts Senior Vice President, General Counsel Tel: 212-605-7663 Email: [email protected] Gary Chant Senior Vice President, Human Resources Tel.: 630-810-2409 Email: [email protected]

mailto:[email protected]


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3.3 VENDOR LEGAL COMPLIANCE POLICY

I. Wilton is committed to ethical and responsible conduct in all business operations. We believe strongly in human rights. We treat customers, employees and suppliers with courtesy and respect. Wilton willingly operates within all applicable Legal Requirements and will only conduct business with suppliers who operate in the same manner. This Vendor Legal Compliance Policy (this “Policy”) applies to each Vendor and its contractors, subcontractors, suppliers, factories and vendors. II. Policy. We require our Vendors to strictly comply with all Legal Requirements including, but not limited to, this Vendor Business Guide and all export, health and safety, equal opportunity, immigration and environmental Legal Requirements. III. Purpose. The purpose of this policy is to define, but not limit, activities that we require from Vendors. IV. Responsibility. Each Vendor is responsible for communicating, monitoring and enforcing factory and other activities for compliance with this Policy. Vendors may not utilize any contractor, subcontractor, supplier, factory or vendor without Wilton’s prior written consent, which may be withheld in Wilton’s sole discretion. Each of the Vendor’s contractors, subcontractors, suppliers, factories and vendors must comply with this Vendor Business Guide, including this Policy, and the Vendor shall be responsible for any breaches of this Vendor Business Guide, including this Policy, by any of Vendor’s contractors, subcontractors, suppliers, factories and vendors. V. Procedures. We explicitly require our Vendors (and their contractors, subcontractors, suppliers, factories and vendors) to comply with all applicable Legal Requirements. In addition, all Vendors (and their contractors, subcontractors, suppliers, factories and vendors) must comply with the following standards:

1. Each Vendor (and its contractors, subcontractors, suppliers, factories and vendors) will comply with all applicable U.S. and foreign labor, health, safety and environmental Legal Requirements.

2. Each Vendor (and its contractors, subcontractors, suppliers, factories and vendors) will

not utilize illegal or oppressive child labor. Child labor as such term is defined by the United Nations or by national standards (whichever is stricter) regarding work performed by children under the legal working age. At a minimum the Vendor (and its contractors, subcontractors, suppliers, factories and vendors) shall employ only employees who have attained an age no less than the legal minimum working age, 15 years of age or the age designated by national law for completion of compulsory education, whichever is greater. For jobs that require greater maturity or pose a safety risk, these employees are to be a minimum of 18 years of age. The Vendor (and its contractors, subcontractors, suppliers, factories and vendors) will not engage in oppressive industrial home work. Vendors will not utilize convicted, forced, or indentured labor in the manufacture of Products.

3. Each Vendor (and its contractors, subcontractors, suppliers, factories and vendors) shall

not discriminate against its employees or prospective employees in hiring or employment practices including salary, benefits, advancement, discipline, termination or retirement or other term or condition of work on the basis of race, color, national origin, gender, religion, age, disability, political affiliation, sexual orientation, social or marital status, maternity, or membership in worker's organization, such as unions, or any other similar factors. Each Vendor (and its contractors, subcontractors, suppliers, factories and


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vendors) will respect the rights of employees to associate, organize and bargain collectively in a lawful and peaceful manner, without penalty or interference.

4. Each Vendor (and its contractors, subcontractors, suppliers, factories and vendors) will provide employees with fair wages that is at a minimum is compliant with applicable Legal Requirements and business customs that include, but are not limited to, correct minimum wages, overtime wages, piece rates compensation, maximum work hours and legally mandated benefits. Vendors (and their contractors, subcontractors, suppliers, factories and vendors) will compensate employees for overtime hours at such premium rate as is legally required or, if there is no legally prescribed premium rate, at a rate at least equal to the regular hourly compensation rate. Where local industry standards are higher than applicable legal requirements, we expect manufacturers to meet the higher standards.

5. Each Vendor (and its contractors, subcontractors, suppliers, factories and vendors) will provide employees with a reasonable work week that is at a minimum compliant with applicable Legal Requirements and business customs. Except in extraordinary business circumstances, Vendors (and their contractors, subcontractors, suppliers, factories and vendors) will not require employees to work more than the lesser of (a) 48 hours per week and 12 hours overtime or (b) the limits on regular and overtime hours allowed by local law or, where local law does not limit the hours of work, the regular work week plus 12 hours overtime. In addition, except in extraordinary business circumstances, employees will be entitled to at least one day off in every seven-day period. Vendors (and their contractors, subcontractors, suppliers, factories and vendors) will treat employees with dignity and respect and will not use corporal punishment, threats of violence or other forms of physical, sexual, psychological or verbal harassment or abuse against employees.

6. Each Vendor (and its contractors, subcontractors, suppliers, factories and vendors) shall

prohibit the use, possession, distribution, and/or sale of illegal drugs.

7. Each Vendor (and its contractors, subcontractors, suppliers, factories and vendors) will furnish employees with safe and healthy workplace, workstations, personal protective equipment ("PPE"), sanitary facilities, potable drinking water, fire safety, adequate lighting and ventilation. During non-working hours, employees shall be free to go outside facility grounds subject to reasonable limitations imposed for the employees' safety. Factories that provide residential facilities for workers must also provide the same standards of health and safety and be in compliance with local standards and laws.

8. Each Vendor (and its contractors, subcontractors, suppliers, factories and vendors) will comply with all applicable Legal Requirements regarding environmental laws and regulations, including, without limitation, laws concerning pollution, dumping, etc. In the absence of such laws, the Vendor (and its contractors, subcontractors, suppliers, factories and vendors) and its factories are to take responsible actions to adopt procedures to ensure the proper protection of the environment.

9. Each Vendor (and its contractors, subcontractors, suppliers, factories and vendors) shall apply for and obtain any and all licenses, permits, approvals, and other authorizations from, and shall make all filings, notifications, and registrations with, all governmental and industry authorities and agencies as are necessary or appropriate in relation to the exercise of its rights and the performance of its obligations under this Vendor Business Guide.

10. Each Vendor (and its contractors, subcontractors, suppliers, factories and vendors) will ensure product has accurate country-of-origin labeling, additionally, if such labeling requires that the Vendor be registered in the country of end sale, the Vendor will, at its own cost, register with the country


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accordingly. Importation of merchandise with inaccurate or misleading country-of-origin labeling violates this policy.

11. Each Vendor (and its contractors, subcontractors, suppliers, factories and vendors)

certifies that it and its representatives have not and will not offer, solicit, accept or provide (or authorize, promise or attempt to offer, solicit, accept, or provide) any gratuity, entertainment, gifts, money, or other thing of value, to Wilton or any or any employee, supplier, customer, inspection agency, or any person or organization associated with Wilton, any government official, or any other person or entity, for the purposes of a bribe, obtaining or retaining business, obtaining or rewarding favorable treatment or inducing improper conduct in connection with this Vendor Business Guide or in connection with the provision of goods or services to Wilton or its affiliates. If a Vendor (or its contractors, subcontractors, suppliers, factories and vendors) is found in violation of any of these activities:

shipments from the Vendor will be stopped until the violation is corrected; or

the discontinuation of the violating factory or Vendor as a Wilton Vendor.

In addition, the Vendor agrees to indemnify Wilton and its affiliates for any liabilities, costs, damages, or expenses it incurs (including attorneys’ fees, costs of investigation and expenses) as a consequence of a violation of this Section 11. By agreeing to abide by this Vendor Business Guide, the Vendor certifies that it (and each of its contractors, subcontractors, suppliers, factories and vendors) is in compliance with this Section 11. The Vendor agrees to indemnify Wilton for any liabilities, costs, damages, or expenses it incurs (including attorneys’ fees, costs of investigation and expenses) as a consequence of any such gratuity being offered, solicited, accepted or provided by the Vendor or the Vendor’s representatives or any attempt to do so.

12. The Vendor (and its contractors, subcontractors, suppliers, factories and vendors) agrees that it will not acquire for use in the performance of this order any merchandise, equipment, supplies, or services originating from, processed in, or transported from or through, the countries and/or persons prohibited from commerce by the United States Government. This restriction includes merchandise, equipment, supplies or services from any other country/person that is restricted by law, regulation or executive order at any time during performance or provision of goods and services to Wilton or its affiliates. The Vendor (and its contractors, subcontractors, suppliers, factories and vendors) will comply with all other applicable Legal Requirements regarding trade embargoes and boycotts and imports and exports generally.

13. The Vendor represents, certifies and warrants that it is not presently nor has it been in

the past (i) suspended, debarred or proposed for suspension or debarment by any government agency or (ii) listed on any US Government watch list or named a “Specially Designated Person” by the U.S. Treasury Office of Foreign Asset Controls pursuant to which U.S. persons or entities are prohibited from conducting business or making payments. The Vendor agrees to comply with all Legal Requirements pertaining to the obligations and transactions contemplated hereunder. Without limiting the foregoing, the Vendor agrees not to solicit or accept any improper inside information relating to this Agreement or in any way connected to the Distributor providing services to the Company, nor to take any action that would subvert any procurement process in connection with this Agreement or the Company or seek favors in connection with any services and transactions in connection herewith. Distributor agrees to report immediately to the Company any actual or suspected violations of the Legal Requirements pertaining to its obligations hereunder for this Agreement.


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14. Wilton reserves the right to investigate any potential violation of Legal Requirements relating to a Vendor’s supply of any goods or performance of any services for Wilton and its affiliates, and, at its discretion, suspend, discontinue, or terminate its relationship with the Vendor for its failure to comply with any of the Legal Requirements.

15. Each Vendor shall maintain at its principal place of business full, complete and accurate books of account and records of its activities with Wilton. Upon reasonable notice, the Vendor shall grant Wilton access during normal business hours to any such books of the Vendor. Not less than once a year, the Vendor shall provide a copy of its financial statements to Wilton. The financial statements shall be created or translated into English and all amounts must be in United States Dollars.

16. The Vendor will use good manufacturing practices, and comply with OSHA (or local safety standards) and all other Legal Requirements, including food and product safety laws. At all times during the Term, the Vendor shall occupy and maintain facilities both in compliance with all Legal Requirements and adequate to produce the Products for sale and delivery to Wilton and to perform its other obligations under this Vendor Business Guide. The Vendor will only manufacture samples of Products and final Products manufactured at a factory approved in writing by Wilton VI. Compliance. Each Vendor shall execute and deliver to Wilton the Vendor Compliance Certificate and such executed Certificate represents the Vendor’s binding legal obligation to comply with this Vendor Business Guide, including this Vendor Legal Compliance Policy and the Product Safety and Quality Compliance Policy. VII. Limitations. This policy is not intended to limit Wilton’s actions regarding Vendor violations of applicable labor laws, customs or import regulations or other applicable laws and regulations. Full compliance is required by all Vendors.

3.4 PRODUCT SAFETY AND QUALITY COMPLIANCE POLICY

Wilton is committed to providing the highest quality, safest products to our customers. When working with Wilton, you also commit to high safety standards and agree to produce Products that meet the Legal Requirements of the United States (or any state or locality of the United States), Canada (or any province or locality of Canada), member state of the European Union or of any other country or jurisdiction where the Products are intended to be sold to consumers. Wilton will identify the jurisdictions (such as but not limited to the United States, Canada, or the European Union) where the Products are intended to be sold. However, the Vendor acknowledges that notwithstanding the jurisdiction of ultimate sale to consumers, Wilton may, in its sole discretion, require that the Products conform to Legal Requirements of additional jurisdictions. The Vendor acknowledges that the Specifications and Quality Standards applicable to Products may be more restrictive than applicable Legal Requirements, and in such case the Vendor will comply with the more restrictive provisions of the Specifications and Quality Standards. Certain of the applicable Legal Requirements include (but are not limited to), the following:

Food and Drug Administration (“FDA”)

California Proposition 65

California Air and Resource Board (“CARB”)

CONEG – Toxics in Plastics


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Lacey Act of 2008

Labeling of Hazardous Art Materials Act (“LHAMA”)

Fair Packaging and Labeling Act (“FPLA’)

Consumer Product Safety Act (“CPSA”)

Consumer Products Safety Improvement Act of 2008 (“CPSIA”) Federal Hazardous Substances Act (“FHSA”) Canadian Standards Association (“CSA”) Hazardous Products Act of Canada Health Canada Regulations General Product Safety Regulations 2005 of the United Kingdom Consumer Protection Act 1987 of the United Kingdom European Union Directive 2001/95/EC on General Product Safety European Union Directive 85/374/EEC Concerning Liability for Defective Products (Product Liability Directive) European Union Directive 2002/95/EC on Restriction of Hazardous Substances (RoHS Directive)

The Global Compliance and Quality Assurance teams at Wilton are available for review of compliance, testing and regulatory requirements by product type and will work with you closely. The Vendor will only use accredited testing facilities that have been approved by Wilton in writing. However, it is your responsibility as a Vendor to Wilton to assure compliance with all Legal Requirements of any country or subdivision thereof in which the Products you produce are intended by Wilton to be sold. In addition to complying with the foregoing, and not in limitation thereof, the Vendor shall comply with the following:

If the Products being supplied by the Vendor include food articles, food ingredients and food packaged, all such food articles, food ingredients and food packaged, supplied to Wilton hereunder are guaranteed by the Vendor, as of the date of Delivery, not to be (i) adulterated or misbranded within the meaning of the Federal Food, Drug, and Cosmetic Act (the “FDCA”), as amended, (ii) an article that may not, under the provisions of Section 404 or 505 of the FDCA, be introduced into interstate commerce, or (iii) an article adulterated or misbranded under any applicable provisions of any other federal, state or municipal law. Further, as of the date of delivery of such Products to the shipping carrier in accordance with the Purchase Order for such Products and until the later to occur of (1) the expiration date specified on such goods or (2) such date after delivery of such Products to the shipping carrier in accordance with such Purchase Order for such Products, as is determined by Wilton in its sole discretion, to be a commercially reasonable time period for the applicable type of goods, such goods shall be marketable and saleable in the ordinary course of business. In addition, if the Products being supplied by the Vendor include food articles, food ingredients and food packaged, the Vendor will comply with the HACCP System and Guidelines. The Vendor shall provide to the Buyer a complete and accurate list of all ingredients used in the Products and nutritional information. The Vendor shall provide Wilton with chemical content information for the Products, including a list of any chemicals and substances used in its manufacturing process that are governed by the State of California’s Health & Safety Code Section 25249.6, otherwise known as California Prop. 65 or any similar law of any other State or locality of the United States, Province or locality of Canada or of any country or jurisdiction in which the Products are intended to be sold to consumers. The Vendor agrees to monitor raw materials suppliers and control manufacturing processes to eliminate lead, heavy metals and other chemicals listed under Proposition 65 from the Products. If it is not possible completely to eliminate a California Prop. 65 listed chemical, the Vendor will advise Wilton in writing of the presence and amount of


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any chemical listed under California Prop. 65, whether that chemical is a deliberately added ingredient, a contaminant, present due to manufacturing practices (e.g., use of local water with elevated lead), or naturally occurring in a food or created during transit or handling (e.g., off gassing from packaging, chemical reaction over time). The Vendor acknowledges that California Prop. 65 can require warnings for chemicals at levels below those required for disclosure under material safety data sheets, thus the Vendor is obligated to advise Wilton in writing of any detectable amount of each listed chemical in the Products, which may require laboratory testing by the Vendor. The Vendor will provide a full list of chemical components of any raw material used in Products, including Chemical Abstracts Service registry number (or CAS) numbers upon request. The Vendor acknowledges that applicable Legal Requirements may limit or prohibit a Product or its packaging from containing lead, mercury, hexavalent chromium, polybrominated biphenyls (PBBs), polybrominated biphenyl ethers (PBDE), cadmium, and other hazardous substances. In addition, the Vendor agrees that no Product or component supplied to Wilton will be manufactured chemical substance or mixture (such as, but not limited to, PCB’s) that is or becomes subject to a reporting requirement under Section 8(e) of the Toxic Substances Control Act, 15 U.S.C. Section 2607(e) as in effect at the time of shipment. The Vendor shall be fully responsible for any and all use and handling of chemical, technical or other materials, whether made available by Wilton to the Vendor or procured by the Vendor. If the material (chemical substances and/or preparations) used in connection with performed services, according to regulations governing dangerous substances, should be marked as dangerous material, Vendor shall be required, before the order is placed, to submit a list showing the exact designation of the particular substance, the respective danger symbols and danger warnings. Wilton reserves the right to prohibit the use of any specific critical substance. In addition to the foregoing, the Vendor agrees that no Products or components supplied to Wilton will contain any arsenic, asbestos, benzene, polychlorinated biphenyls (PCBs), carbon tetrachloride, certain azo colorants, polychlorinated naphthalenes (>3 chlorine atoms), radioactive substances, certain shortchain chlorinated paraffins, tributyl tin (TBT), triphenyl tin (TPT), tributyl tin oxide (TBTO) or any of the banned phthalates listed in California Prop. 65 or the CPSIA: bis (2-ethylheyl) phthalate (DEHP), dibutyl phthalate (DBP), benzyl butyl phthalate (BBP), di-isonyl phthalate (DINP), di-isodecyl phthalate (DIDP) and di-n-alkyl phthalate (DnOP). The Vendor agrees that no Products or components supplied to Wilton will contain any ozone-depleting solvents or ozone-depleting chemicals (“ODCs”) that are restricted under any applicable Legal Requirements of the United States (or any state or locality of the United States), Canada (or any province or locality of Canada), member state of the European Union or of any other country or jurisdiction where the Products are intended to be sold to consumers, including but not limited to, Section 611 of the Clean Air Act Amendment of 1990 (“Section 611”) of the United States and the Montreal Protocol. All solvents used on materials to be used on the Products shall be water-soluble. In the event that the Vendor is notified (by the applicable governmental or industry body or by Wilton that the Vendor is not in compliance with any Legal Requirement, then the Vendor shall notify Wilton and, at its sole expense and within whatever time period is specified by any applicable governmental or industry body or, if none, promptly, comply with such Legal Requirement. Further, the Vendor must notify Wilton of any inspections of its facilities, equipment, or personnel by any governmental or industry body and must provide Wilton with a copy of the results of any such inspection and of any corrective action required or recommended by such body, all within 5 days of having received such results and requirement or recommendation. The Vendor will provide immediate assistance to Wilton in responding to any inquiry or observation from any governmental agency or industry standards organization, and will promptly


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investigate and respond to any allegation the Product is improperly designed or has failed to perform properly. CPSIA enacted new requirements for lead content, phthalates and tracking of Products intended primarily for children twelve years old and younger. The following website provides information and updates pertaining to CPSIA: http://www.cpsc.gov/ABOUT/Cpsia/cpsia.HTML Additional websites for the Legal Requirements that may be applicable to the Products include: Food and Drug Administration (FDA) - www.fda.gov California Proposition 65 – oehha.ca.gov/prop65 California Air and Resource Board (CARB) – Airborne Toxic Control Measure to Reduce Formaldehyde Emissions from Composite Wood Products - www.arb.ca.gov/regact/2007/compwood07/fro-final.pdf CONEG – Toxics in Packaging – www.coneg.org

Lacey Act of 2008 – www.aphis.usda.gov

Labeling of Hazardous Art Materials Act (LHAMA) – www.cpsc.gov

Fair Packaging and Labeling Act (FPLA) – www.ftc.gov/os/statutes/fplajump.shtm

Consumer Product Safety Act (CPSA) - www.cpsc.gov/businfo/cpsa.html Health Canada Regulations - http://www.hc-sc.gc.ca/index-eng.php Hazardous Products Act - http://laws.justice.gc.ca/eng/H-3/index.html European Union Directives -- http://europa.eu/legislation_summaries/index_en.html Each Vendor that supplies Wilton and its businesses are required to monitor raw material suppliers, component suppliers, and control manufacturing processes to comply with this Product Safety and Compliance Policy and applicable Legal Requirements where Wilton sells Products manufactured by the Vendor and additional jurisdictions identified by Wilton; the other sections of the Vendor Business Guide; and the Specifications. Vendors may not utilize any contractor, subcontractor, supplier or factory without Wilton’s consent, which consent may be withheld in Wilton’s sole discretion. Each of the Vendor’s contractors, subcontractors, suppliers, factories and vendors must comply with this Vendor Business Guide, and the Vendor shall be responsible for any breaches of this Vendor Business Guide by any of Vendor’s contractors, subcontractors, suppliers, factories or vendors. When requested, the Vendor agrees to provide Wilton all test results documenting information on chemicals listed under California Prop. 65 and other applicable Legal Requirements. The Vendor agrees to keep all such test results for at least six (6) years. The Vendor acknowledges that Wilton will rely on Vendor’s disclosures to Wilton, and will rely on Vendor’s test results. The Vendor will also keep documentation on file from the Vendor’s suppliers indicating that all raw materials are compliant with the requirements of this Vendor Business Guide for no less than six (6) years. THIS PRODUCTS SAFETY AND QUALITY COMPLIANCE POLICY IS SUBJECT TO AMENDMENT FROM TIME TO TIME BY WILTON IN ITS SOLE DISCRETION, INCLUDING BUT NOT LIMITED TO FOR CHANGES IN LEGAL REQUIREMENTS, SPECIFICATIONS AND QUALITY STANDARDS. WILTON SHALL MAKE AVAILABLE TO THE VENDOR THE AMENDED PRODUCTS SAFETY AND QUALITY COMPLIANCE POLICY. THE VENDOR’S CONTINUED PERFORMANCE SHALL BE DEEMED ITS CONTINUING CONSENT TO THE PRODUCTS SAFETY AND QUALITY COMPLIANCE POLICY, AS AMENDED. THE MOST CURRENT VERSION OF THIS PRODUCTS SAFETY AND QUALITY COMPLIANCE POLICY SHALL ALWAYS BE USED AND PRIOR VERSIONS DISCARDED.

http://www.cpsc.gov/ABOUT/Cpsia/cpsia.HTML

http://www.cpsc.gov/businfo/cpsa.html

http://www.hc-sc.gc.ca/index-eng.php

http://laws.justice.gc.ca/eng/H-3/index.html

http://europa.eu/legislation_summaries/index_en.html


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Director Global Compliance and Quality Assurance is responsible for control and update of this Products Safety and Quality Compliance Policy. By executing the Compliance Certificate, you, the Vendor, agree to comply with this Vendor Business Guide, including the Products Safety and Quality Compliance Policy, produce Products and packaging that comply with the Products Safety and Quality Compliance Policy and all Legal Requirements where Wilton sells Products manufactured by the Vendor and additional jurisdictions identified by Wilton; the other sections of the Vendor Business Guide; the Specifications; supply test results or additional quality compliance documents upon request; and to pay for periodic random testing of the Products you manufacture when they before or after they are delivered to Wilton. If the Vendor fails to comply with this Product Safety and Quality Compliance Policy, Wilton will be entitled to recover the Losses incurred as a result of such failure.

Please address any compliance questions or concerns to: Don Moffett Director of Compliance and Quality Assurance Email: [email protected] Phone: (630) 810-2597 Wilton Brands LLC 2240 West 75

th Street

Woodridge, IL 60517 U.S.A.

BARCODE VERIFIER COMPLIANCE POLICY

In an effort to reduce charge backs and reworks of received Products, Wilton requires its Vendors to purchase and use barcode verifiers. Barcode verifiers scan barcodes and validate the quality of the barcode label itself. Since our retail customers have varying types of scanners in their stores, it is necessary for our labels to scan at a “GRADE A” level, following ANSI (American National Standards Institute) “Bar Code Print Quality Guideline”. The ANSI specification was adopted by the Uniform Code Council and is accepted in the United States and Canada. With acknowledgment of this policy, you, the Vendor, agree to purchase barcode verifiers and incorporate them in your overall quality process. All labels must be sampled and verified before application to Products. In addition, the barcode verifiers must be used as part of your final inspection process.

4 PURCHASE ORDER GUIDELINES

4.1 WILTON STANDARD PURCHASE AGREEMENT AND CONDITIONS

The following is Wilton’s standard Purchase Agreement and Conditions and applies to all purchase orders. Each Vendor shall execute and deliver to Wilton a Certificate of Compliance and such executed Certificate represents the Vendor’s acceptance and binding legal agreement to the following terms


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(capitalized terms used and not defined in the following Purchase Agreement and Conditions shall have the meanings set forth in the Vendor Business Guide) :

1. General. The addressee named on the face of the applicable purchase order (together with these terms and conditions, the “Purchase Order”) is herein referred to as the “Vendor” and Wilton Industries, Inc., a Delaware corporation (or any of its subsidiaries or affiliates), is herein referred to as the “Buyer”. The Purchase Order, together with the Wilton Vendor Business Guide and other Buyer policies referenced therein (as amended from time to time, the “Vendor Business Guide”) and, if the Vendor has entered into a written supply agreement or other agreement relating to the supply of Product to Buyer, such supply agreement and other agreement, shall constitute the entire agreement between Buyer and the Vendor regarding the supply of Product and/or services subject to the Purchase Order. Buyer shall not be bound by any provisions, whether printed or otherwise, which shall appear in any proposal, separate acknowledgment, or other writing. To the extent that any terms and conditions set forth on any such separate proposal, acknowledgement, other writing, or on the face of the Purchase Order conflict with this Purchase Agreement and Conditions, this Purchase Agreement and Conditions shall govern; provided, however, that the foregoing shall not apply to a proposal, separate acknowledgement or other writing that is executed by duly authorized representatives of Buyer and the Vendor.

2. Delivery; Risk of Loss; Acceptance; Partial Shipments.

a. If the phrase “Delivery Time is Critical” (or a similar phrase) appears on the face of the Purchase Order, Delivery of the Product and/or services shall be made within the time specified on the face of the Purchase Order and at the location specified in the Purchase Order, failing which (unless Delivery of the Product and/or services have been authorized in writing by Buyer’s duly authorized representative) Buyer reserves the right, at its option, upon written notice to the Vendor, to (i) cancel the Purchase Order without penalty or cost to Buyer, (ii) purchase the described Product and/or services from a vendor of Buyer’s choice and charge the Vendor with all loss or damage occasioned thereby plus a refund of any sums paid to the Vendor by Buyer in respect of such Product and/or services or (iii) receive a discount from the Vendor for the Purchase Order of an amount determined by Buyer, in its sole discretion, to be customary with industry standards (which discount is in lieu of determining the actual damages suffered by Buyer, which may be difficult or impossible to ascertain, and which discount is intended as liquidated damages and not as a penalty). Otherwise, Delivery shall be within a reasonable time but in no event later than Required Date specified on the face of the Purchase Order, or if no such time is specified, within 30 days after the date of the Purchase Order. The Vendor shall promptly notify the Buyer in writing of any delay or anticipated delay on shipment of any portion of a Purchase Order. The Vendor will be liable for any Losses incurred by the Buyer resulting from such delay. Buyer may change the schedule of shipments or direct temporary suspension of scheduled shipments, but neither event shall entitle the Vendor to modify the price for Product and/or services covered by the Purchase Order. The Vendor shall convey good title, free from any lien, claim or encumbrance, to all Product and/or services shipped by the Vendor under the Purchase Order. With respect to services, “Delivery” shall occur upon the completion of all of the services specified on the face of the Purchase Order, and with respect to Product and/or services, “Delivery” shall occur upon the Vendor’s delivery of the Product and/or services to the shipping carrier (Incoterms 2000) FOB as specified in the Purchase Order. Title to Product and/or services shall pass at the time of Delivery. Any loss or damage to Product and/or services prior to passing of title shall be at the Vendor’s risk.

b. Payment for Product and/or services specified on the face of the Purchase Order or acceptance of Delivery thereof shall not constitute an acceptance of such Product and/or services. All such Product and/or services shall be subject to Buyer’s acceptance or rejection. If rejected, the Product and/or services shall be returned for (i) cancellation of all or any part of the Purchase Order and refund, as applicable, (ii) credit or (iii) replacement or modification (or, in the case of services, the Vendor shall perform replacement services), all in Buyer’s sole discretion and at the Vendor’s sole cost and expense, and all risk of loss, handling and transportation charges, and other costs to ship the replacement or modified Product and/or services and returned Product and/or services occasioned by Buyer’s rejection shall be assumed by the Vendor.


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c. Either party may request in writing a partial shipment of the Product and/or services described in the Purchase Order, which request may be approved or disapproved in writing by the other party in advance. If such partial shipment is approved by both parties and made, the Vendor shall be permitted to invoice Buyer for the partial shipment. If the parties do not agree to a partial shipment in writing, no partial shipment or invoicing shall be made. In the event that partial shipment is requested by Buyer and disapproved by the Vendor, Buyer shall be entitled to cancel the entire applicable Purchase Order.

d. Buyer may cancel the Purchase Order at any time prior to shipment of the applicable Product and/or services or commencement of the applicable services without penalty or cost to Buyer.

e. Time is of the essence as to the Vendor’s performance in all respects under a Purchase Order. 3. Acceptance of Terms and Conditions. Unless otherwise provided on the face of the Purchase Order, any

written acknowledgment of the Purchase Order or the Delivery of any Product and/or services in accordance with the Purchase Order shall constitute acceptance by the Vendor of the provisions in the the Vendor Business Guide, this Purchase Agreement and Conditions and the Purchase Order, including, but not limited to, the face and reverse side of the applicable Purchase Order.

4. Pricing. Unless otherwise shown on the face of the Purchase Order, the prices for the Product and/or

services stated on the face of the Purchase Order are inclusive of any and all taxes, fees, duties or governmental impositions whatsoever, including, without limitation, any and all customs duties and sales, use, excise, value-added, consumption and similar taxes, whether or not same are set forth separately on invoice to the Buyer. If the Buyer shall subsequently be required to pay any taxes or other fees relating to the production, sale or transportation of the Products to the FOB point, the Vendor will reimburse the Buyer therefore. If any tax is included in said prices with respect to which a refund is hereafter made to the Vendor, the Vendor shall immediately pay the Buyer the amount of such refund. In the event the Vendor receives any refund, payment, or award with respect to any taxes paid by the Buyer in connection with any transaction in connection with a Purchase Order, the Vendor shall remit all such refund, payment, or award amounts to the Buyer, promptly and no later than 10 days following the receipt of each such amount. No charges will be allowed for containers, coating, boxing, or other packaging unless otherwise expressly stated on the face of the Purchase Order. For a 30 day period following the date of Delivery, if the Vendor has charged Buyer more for Product and/or services than it has charged its other customers purchasing materially similar goods and/or services (“Similar Goods and/or Services”), then the Vendor promptly shall notify Buyer of such occurrence and immediately reduce the price charged to Buyer and refund amounts to Buyer, as is necessary, so that such price is equal to or less than the other customer’s effective net price for the Similar Goods and/or Services. In furtherance of its obligations under this Section 4, promptly upon Buyer’s request, the Vendor shall cause its chief financial officer to execute and deliver a certificate to Buyer certifying that the Vendor is in compliance with the requirements of this Section 4. In any event, at any time upon request by Buyer, the Vendor shall make available to Buyer all price lists and volume discount schedules relating to Goods and Services.

5. Warranties.

a. The Vendor is duly incorporated or organized, validly existing, and in good standing under the laws of its jurisdiction of incorporation or organization, has full power and authority to carry on its business as now being conducted, has full power and authority to carry out the transactions described in the Purchase Order, has taken all necessary action required by law, its organizational documents or otherwise to authorize the execution and performance of the Purchase Order and the transactions required hereby, and the Purchase Order is a valid and binding obligation of the Vendor, enforceable in accordance with its terms, and that execution, Delivery, and performance of the Purchase Order does not and will not violate any provision of any agreement or commitment to which the Vendor is a party or which is applicable to the Vendor, or to its knowledge violate any law applicable to the Vendor. The Vendor warrants that (i) it is duly incorporated or organized, validly existing, and in good standing under the laws of its jurisdiction of incorporation or organization, has full power and authority to carry on its business as now being conducted, has full power and authority to carry out the transactions described in the Vendor Business Guide, the Purchase Order and this Purchase Agreement and Conditions, (ii) it has taken all necessary action required


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by law, its organizational documents or otherwise to authorize the execution and performance of the Vendor Business Guide, the Purchase Order, this Purchase Agreement and Conditions and the transactions required hereby, (iii) the Vendor Business Guide, the Purchase Order and this Purchase Agreement and Conditions are valid and binding obligations of the Vendor, enforceable in accordance with their terms, and (iv) that execution, delivery, and performance of the Vendor Business Guide, the Purchase Order and this Purchase Agreement and Conditions does not and will not violate any provision of any agreement or commitment to which the Vendor is a party or which is applicable to the Vendor or any Legal Requirements applicable to the Vendor.

b. To the extent Buyer purchases any services hereunder, the Vendor represents, warrants and covenants that competent, knowledgeable, and experienced personnel in the type of services to be performed shall perform such services in a professional and workmanlike manner consistent with industry standards and such services shall meet all specifications set forth on the face of the Purchase Order; provided, however, that where the face of the Purchase Order specifies a particular standard or criteria for performance more particular than the foregoing, this warranty is not intended to and does not diminish that standard or criteria for performance. Further, in any case where detailed requirements for a service are not mutually agreed upon or set forth in a Purchase Order, such services shall be fit and sufficient for the purposes expressed in, or reasonably to be inferred from, the Purchase Order, as the case may be.

c. The Vendor expressly represents and warrants that the Product and/or services shall be of good and merchantable quality, free from defects (latent or otherwise) in material and workmanship (and free from defects in design if the design is owned by or provided by the Vendor) and strictly conform to the Specificationsand the terms of the Vendor Business Guide. The Vendor acknowledges that the Vendor knows the Buyer’s and the Buyer’s consumers intended use and expressly warrants that Products covered by the Purchase Order have been and will be selected, designed, manufactured, and assembled by the Vendor based upon the Buyer’s and such consumers intended use and will be fit and sufficient for the particular purpose intended by the Buyer such the consumer. In addition to its other rights and remedies, Buyer reserves the right to cancel the Purchase Order in whole or in part or have the Vendor reimburse the Buyer for any direct, indirect, incidental, special, and consequential damages caused by nonconforming Product and/or services, including, but not limited to, costs and expenses incurred by the Buyer for inspecting, sorting, repairing, and replacing such nonconforming Product and/or services, if said Product and/or services do not satisfy the foregoing representations and warranties.

d. The Vendor represents and warrants that, except for the Intellectual Property supplied by Wilton or an Approved Vendor, the Vendor owns all patents, trademarks, service marks, copyrights, trade dress, designs, and any and all other intellectual property rights related to or residing in the Products (including in any components) or its packaging or the manufacture of the Products or its packaging, or the services performed b the Vendor, and that none of the Product and/or services infringes in any manner on the intellectual property rights of any other person.

e. The Vendor represents and warrants that in proposing or agreeing to a price for the goods and/or services being sold to the Buyer, such price has been arrived at independently, without the purpose of restricting competition and without any consultation, communication, or agreement with any of the Vendor’s competitors relating to (i) the price, or (ii) the methods or factors used to calculate such price.

f. To the extent prices are stabilized by governmental action, the prices shown on the face of the Purchase Order do not exceed those lawfully permitted.

The forgoing warranties, and such other warranties as may be specifically set out herein, are in addition to all other warranties, which may vest in Buyer pursuant to applicable provisions of the Uniform Commercial Code or otherwise by operation of law. All such warranties survive the Delivery of the Product and/or services and the receipt and acceptance thereof by Buyer.

6. Insurance. The Vendor shall maintain such General Liability, Product Liability, Property Damage, and

Employee Liability and Compensation Insurance an occurrence form adequate to cover the Vendor’s


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obligations hereunder but in no event having minimum policy limits of not less than two million dollars ($2,000,000) per occurrence, five million dollars ($5,000,000) in the aggregate, combined coverage of personal injury, bodily injury, property damage, completed operations/product liability and contractual liability, per occurrence and which meets the requirements of this Vendor Business Guide. To the extent such insurance coverage is insufficient to reimburse Buyer for its liabilities hereunder, the Vendor shall remain liable to Buyer for any deficiency. All of the Vendor’s insurance required in this Section 6 shall be primary to, and shall receive no contribution from any other insurance maintained by, on behalf of, or benefiting the Buyer, its parent, subsidiaries and affiliated entities, and their respective officers, directors, employees, and stockholders. The Vendor shall furnish the Buyer with certificates of insurance evidencing the coverage and minimum limits set forth in this Section 6 prior to or concurrent with the inception date of this Agreement, during the Term, and for a period of six (6) years after the date of the Vendor’s last shipment of Products to retailers under this Agreement. All of the Vendor’s insurance policies required in this Section 6 shall provide that thirty (30) days written notice will be given to the Buyer prior to any material change in, or cancellation of, such insurance policies. All of the Vendor’s insurance required in this Section 6 shall name the Buyer, its parent, subsidiaries and affiliated entities and their respective officers, directors, employees, stockholders, and agents as additional insured’s and shall contain provisions that the Vendor’s insurers shall have no right of recovery or subrogation against any of such entities.

7. Force Majeure. Each party shall be excused from liability for failure to perform under this Purchase Order

because of Acts of God, fire, floods, unanticipatable actions by governments, or other unanticipated causes which cannot be remedied by the reasonable efforts of the party whose performance is impaired; provided, however, that strikes, lockouts and other forms of labor unrest are specifically excluded and do not constitute events of force majeure. The party declaring force majeure shall notify the other party promptly in writing of the commencement of the condition, the nature, and the termination of the force majeure condition. The parties shall use reasonable efforts to continue to meet their obligations for the duration of the force majeure condition.

8. Indemnity. The Vendor shall defend, indemnify and hold harmless the Buyer, its customers and each of

their respective directors, officers, employees, agents, and affiliates and any person or entity directly or indirectly employed by any of them (collectively, the “Indemnified Parties,” and individually, an “Indemnified Party”) from and against all Losses which in any way arise out of or result from (i) any breach of the Vendor’s obligations or representations under this Vendor Business Guide, this Purchase Agreement and Conditions or a Purchase Order, including any breach of the Specifications, Quality Standards or the Legal Requirements, by the Vendor or by the Vendor’s subsidiaries or affiliates or their respective officers, directors, employee, managers, agents, or for any other person or entity whose acts the Vendor may be liable, or the acts or omissions of the Vendor in connection with a Purchase Order or the Vendor Business Guide, (ii) any actual or alleged injury to or death of any person, damage to or destruction of any property, real or personal relating to the Products and/or the services provided by the Vendor, (iii) any actual or alleged deficiency or defect in the Products, and/or the services provided by the Vendor, (iv) any actual or alleged infringement of any patent, trademark, copyright, design, or other intellectual property right or for alleged unfair competition, by reason of the manufacture, use, or sale of the Products or (v) the use or occupancy of any facilities by the Vendor or use of any tools or other equipment provided or owned or controlled by any Indemnified Party. The Vendor’s indemnification obligations under this Section 8 shall be absolute except to the extent such Loss arises from the gross negligence, willful misconduct, or an infringing Intellectual Property provided by such Indemnified Party or a supplier required by the Buyer to be used by the Vendor for use in a Product and/or services. The Vendor may not settle any matter for which indemnification is or may be sought under this Section 8 without the prior written consent of the Buyer, which may be withheld in its sole discretion. The Vendor’s obligations in this Section 8 shall survive the Delivery of the Product and/or services and the receipt and acceptance thereof by Buyer.

9. Limitation of Liability. BUYER SHALL NOT BE LIABLE TO THE VENDOR FOR ANY AMOUNTS

REPRESENTING THE VENDOR’S LOSS OF PROFITS, LOSS OF BUSINESS INCOME, INDIRECT, SPECIAL, INCIDENTAL, EXEMPLARY, CONSEQUENTIAL, OR PUNITIVE DAMAGES (EVEN IF PREVIOUSLY APPRISED OF THE POSSIBILITY THEREOF), ARISING FROM THE PERFORMANCE OR NONPERFORMANCE UNDER THIS VENDOR BUSINESS GUIDE OR A PURCHASE ORDER OR ANY


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ACTS OR OMISSIONS ASSOCIATED THEREWITH OR RELATED TO THE USE OF ANY PRODUCT AND/OR SERVICES FURNISHED UNDER THIS VENDOR BUSINESS GUIDE OR A PURCHASE ORDER, WHETHER THE BASIS OF THE LIABILITY IS BREACH OF CONTRACT, TORT (INCLUDING NEGLIGENCE AND STRICT LIABILITY), STATUTES, OR ANY OTHER LEGAL THEORY, UNLESS SUCH ACT OR OMISSION ARISES FROM THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF BUYER. BUYER’S AGGREGATE LIABILITY FOR ANY REASON AND ALL CAUSES OF ACTION ARISING OUT OF OR RELATING TO THE PURCHASE ORDER (INCLUDING, BUT NOT LIMITED TO, CONTRACT, TORT (INCLUDING NEGLIGENCE) AND STRICT PRODUCT LIABILITY) SHALL BE LIMITED TO FIFTY (50%) OF THE FEES PAID BY BUYER. THE PROVISIONS OF THIS SECTION 9 SHALL SURVIVE THE DELIVERY OF THE PRODUCT AND/OR SERVICES AND THE RECEIPT AND ACCEPTANCE THEREOF BY BUYER.

10. Recalls. In the event of a one or more or any portion of the Product and/or services is subject to a recall or

corrective action by or under the supervision of any international, regional, national, federal, state, provincial, local, or other governmental authority or by the Buyer due to the breach by the Vendor of its obligations under this Vendor Business Guide, this Purchase Agreement and Conditions or a Purchase Order, the Vendor shall be liable and shall indemnify and hold harmless the Buyer and Customers for all associated Losses, including, but not limited to, (i) all costs of removal, shipment, and replacement of Product and/or services in connection with such recall; (ii) all administrative charges incurred in connection with such recall; and (iii) all attorneys’ fees incurred in connection with such recall. The Vendor shall notify the Buyer in writing as soon as possible if the Vendor is notified by any international, regional, national, federal, state, provincial, local, or other governmental authority that a Product and/or services is the subject of a recall or corrective action, or is the subject of an investigation or inquiry that may result in a recall or corrective action, in each case whether or not the Vendor would be responsible for the recall or corrective action.

11. Federal Government Subcontracts. The provisions and requirements of Executive Orders 11246 and 11375,

41 C.F.R. § 60-1.4, the Vietnam Era Veterans Readjustment Assistance Act of 1974, as amended, 41 C.F.R. § 60-250.5, Section 503 of the Rehabilitation Act of 1973, as amended, 41 C.F.R. § 60-741.5, and 29 C.F.R. Part 470 are incorporated herein by reference, if and to the extent applicable. If applicable, the Vendor will include the provisions of this paragraph in every subcontract or purchase order unless exempted by rules, regulations, or orders of the Secretary of Labor issued pursuant to Section 204 of Executive Order No. 11246 of September 24, 1965, so that such provisions will be binding upon each subcontractor or vendor. The Vendor will take such action with respect to any subcontract or purchase order as the contracting agency may direct as a means of enforcing such provisions including sanctions for noncompliance; provided, however, that in the event the Vendor becomes involved in, or is threatened with, litigation with a subcontractor or vendor as a result of such direction by the contracting agency, the Vendor may request the United States to enter into such litigation to protect the interest of the United States.

12. Proprietary Rights and Confidentiality.

a. All materials including, but not limited to, any Intellectual Property provided by or on behalf of the Buyer or its affiliates (collectively the “Buyer Materials”) shall shall remain the sole and exclusive property of the Buyer. Any enhancements, modifications and improvements to the Buyer Materials (the “Work Product”) shall upon creation be considered a “Work Made for Hire” as that phrase is defined by the U.S. copyright laws (and/or the equivalent concept under non-U.S. jurisdictions) and shall be owned by and for the express benefit of the Buyer. In the event it should be established that the Work Product does not qualify as a Work Made for Hire, the Vendor agrees to and does hereby assign to the Buyer all of its right, title, and interest in the Work Product. The Vendor hereby irreversibly assigns any and all rights it may have or acquire in any portion of Intellectual Property, at law or in equity, to the Buyer. The Vendor agrees to sign such further documents as may be requested by the Buyer to effectuate the transfer of Buyer Materials. The Vendor may not disassemble, decompile, reverse engineer, reproduce, modify or distribute the Buyer Materials, in whole or in part, or use them for the benefit of any third party. Each Product and its packaging

shall bear an appropriate country of origin legend and the appropriate trademark notice ( or ) adjacent any Buyer registered or common law trademark used.


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b. The Vendor agrees to maintain in confidence, and not to disclose to third parties or use, without the prior written consent of Buyer, the Buyer Materials and any other information and materials provided by the Buyer in connection with the Purchase Order and the Vendor Business Guide, including, but not limited to, the content of the Purchase Order, information identified or marked as confidential or other information that, due to its character and nature, a reasonable person under like circumstances would treat as confidential.

c. In addition to the foregoing, the Vendor acknowledges and agrees that its breach of Section 12, in any instance, shall result in immediate and irreparable damage to the Buyer; that money damages would not be a sufficient remedy for a breach of Section 12 and that no adequate remedy at law exists for such damage; and in the event of such failure or breach or threatened failure or breach, the Buyer shall be entitled to equitable relief by way of temporary, preliminary and permanent injunctions, and such other and further relief as any court of competent jurisdiction may deem just and proper, in addition to, and without prejudice to, any other relief to which the Buyer may be entitled at law or in equity. The Vendor waives any requirement for the posting of a bond or other security by the Buyer in connection with the Buyer obtaining any such temporary, preliminary and/or permanent injunction.

d. The provisions of this Section 12 shall survive the Delivery of the Product and/or services and the receipt and acceptance thereof by Buyer.

13. Currency All Purchase Orders and payments between the parties shall be made in U.S. dollars unless the

Buyer provides its written consent to another currency for payment of some of all of the payment between the Buyer and the Vendor in advance of the creation of the payment obligation.

14. Legal Requirements, Vendor Legal Compliance Policy, Product Safety and Quality Compliance Policies.

The Product and/or services called for herein have been produced, manufactured and delivered, as applicable, in accordance with, and the Vendor’s provision of the services complies with, this Vendor Business Guide, this Purchase Agreement and Conditions, the applicable Purchase Order and all applicable Legal Requirements including, but not limited to, and all export, health and safety, equal opportunity, immigration and environmental laws, restrictions and regulations. The Vendor shall comply with all Legal Requirements in connection with the conduct of its business. The Vendor represents that it has read the Vendor Legal Compliance Policy and the Products Safety and Quality Compliance Policy in this Vendor Business Guide, and shall comply with such policies. The provisions of this Section 14 shall survive the Delivery of the Product and/or services and the receipt and acceptance thereof by Buyer

15. Miscellaneous.

a. These Purchase Agreement and Conditions and a Purchase Order shall be governed by and

construed in accordance with and pursuant to the laws of the State of Illinois, U.S.A. (without regard to any conflicts of law rules that could result in the application of the laws of another jurisdiction). The Vendor expressly and irrevocably waives any immunity on the grounds of sovereignty, the act-of-state doctrine, or the like, including the application of all or any of the provisions of the United Nations Convention on Contracts for International Sale of Goods (Vienna Sales Convention) and the U.S. Foreign Sovereign Immunities Act, 28 U.S.C. et seq in connection with its supply of Products or performance of services for the Buyer, arising under the Vendor Business Guide, this Purchase Agreement and Conditions or a Purchase Order. Any dispute, controversy or claim arising out of or relating to the Vendor Business Guide, these Purchase Agreement and Conditions a Purchase Order or its breach shall be conducted in English and shall be submitted to the exclusive jurisdiction of the state and federal courts in the State of Illinois; except that in actions seeking to enforce any order or judgment of such courts in Illinois, such jurisdiction shall be nonexclusive. Each of the parties hereby irrevocably consents, generally and unconditionally, to the personal jurisdiction of the state and federal courts in the State of Illinois, and each party irrevocably waives any objection, including any objection to the laying of venue based on the grounds of forum non conveniens, which it may now or hereafter have to the bringing of any action or proceeding in such courts. The parties agree that the Purchase Agreement and Conditions and the Purchase Order is written in the English language and that the English


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language version of the Purchase Agreement and Conditions and the Purchase Order will control for all purposes of interpretation and otherwise, regardless of whether the Purchase Agreement and Conditions or the Purchase Order is subsequently or simultaneously translated into any other language, and regardless of whether any such translation may be signed by the parties If any term of the Purchase Agreement and Conditions or the Purchase Order is found to be invalid or unenforceable under any statute, regulation, ordinance, order, or any other rule of law, such term shall be deemed reformed or deleted, but only to the extent necessary to comply with such statute, regulation, ordinance, order, or rule, and the remaining provisions of this Purchase Agreement and Conditions and a Purchase Order shall remain in full force and effect.

b. No modification or waiver of any provision of this Purchase Agreements or a Purchase Order shall be valid unless set forth in a written instrument signed by both parties. The failure or delay of either party to enforce, at any time or for any period of time, any provision of this Purchase Agreement and Conditions or Purchase Order or any right or remedy available hereunder or at law or equity shall not be construed to be a waiver of such provision or of any available right or remedy. In addition, no single or partial exercise of any right, power or privilege hereunder shall preclude the enforcement of any further exercise or exercise of any right, power or privilege hereunder.

c. The Vendor may not assign or delegate its rights or obligations, or permit any subcontractor to perform, under the Purchase Order in whole or in part without the prior written consent of Buyer, which consent may be given or withheld at Buyer’s sole discretion. Any of the Vendor’s, subcontractor must comply with this Vendor Business Guide, and the Vendor shall be responsible for any breaches of the Purchase Order by any of Vendor’s subcontractor. Buyer may assign and delegate all of its respective rights and obligations under the Purchase Order in whole or in part to any successor or assign without the consent of the Vendor. The provisions of the Purchase Order will be binding upon and inure to the benefit of the parties and upon and to their respective permitted successors and permitted assigns.

d. The Indemnified Parties shall be third party beneficiaries of this Purchase Agreement and Conditions and the Purchase Order, and other than the Indemnified Parties, there are no third party beneficiaries to this Purchase Agreement and Conditions or a Purchase Order. The parties to this Purchase Agreement and Conditions and a Purchase Order are independent contractors.

e. The Vendor may not issue a press release, public announcement or other public statements regarding the Vendor Business Guide, this Purchase Agreement and Conditions or a Purchase Order without Buyer’s prior written consent.

f. All article and section headings or captions are for convenience only and shall not affect the interpretation or construction of this Purchase Agreement and Conditions or a Purchase Order. Any notice or consent required or permitted to be given under the Purchase Order shall be in writing and shall be deemed to have been given when actually received by the other party.

g. Notices shall be delivered to the Vendor and Buyer at the respective addresses set forth on the face of the Purchase Order, or to such other address as is provided by one party to the other in writing.

h. The Purchase Order may be executed in counterparts, each of which shall be deemed an original and all of which together shall constitute one and the same instrument. The Purchase Order may be delivered by facsimile or other electronic transmission (including by e-mail in “pdf” form) and each party shall be permitted to rely upon the signatures so transmitted to the same extent and effect as if they were original signatures. The provisions of this Section 15 shall survive the Delivery of the Product and/or services and the receipt and acceptance thereof by Buyer.

4.2 FORECASTS AND LONG LEAD TIME MATERIALS; APPROVED VENDORS

4.2.1 Inventory Levels The Vendor will maintain an inventory of Products and packaging materials satisfactory to Wilton and adequate to supply Products to Wilton, without delay. The Vendor acknowledges that the actual


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quantities and order patterns may vary and may not be evenly distributed throughout the Term. The Vendor agrees to use its best available knowledge, in order to ascertain the levels at which such inventory shall from time to time be maintained.

4.2.2 Forecasts Wilton may provide the Vendor with stock level parameters for one or more Products and packaging materials as needed (“Forecasts”) from time to time throughout the Term. If so provided, the Vendor will use the Forecasts for managing the production, inventory and distribution level of the relevant Products and packaging and, notwithstanding any other provision of this Vendor Business Guide, any inventory in excess of the specified levels in the Forecasts is the sole responsibility of the Vendor. The Vendor will maintain a maximum lead-time (Purchase Order receipt to ship date) for each Product. The Vendor shall satisfy the required production quantity within the established lead times. The Vendor will immediately advise Wilton if it cannot comply with any lead-time. The Vendor will provide to Wilton a copy of the Vendor’s manufacturing calendar for the current year and next year which presents all known/planned holiday and factory shutdowns.

4.2.3 Long Lead Time Materials Wilton will commit, as defined herein, to the long lead time materials that are unique to the Products (“Long-Lead Material”) relating to the first 3 months of the Forecast. The Vendor agrees to supply Wilton with a list of what items it deems to be Long-Lead Material and their respective line item costs before making any purchases, which Wilton must approve in writing before the Vendor purchases Long-Lead Material. The Vendor agrees that any Long-Lead Materials purchases made by the Vendor shall not exceed the minimum amount of Long-Lead Material needed to fulfill the Forecast considering the applicable lead times for such items. If the Long-Lead Material that has been purchased in accordance with this Section 4.2.3 has not been consumed by a Purchase Order prior to the discontinuance of the relevant Product, Wilton will purchase the Long-Lead Material at a price equal to the actual and direct cost of such items.

4.2.4 Approved Vendors Wilton may designate certain suppliers and other vendors as approved vendors for raw materials, components, and/or packaging (the “Approved Vendors”). Wilton may, by written instruction to the Vendor, require the Vendor to use certain (or all) of the Approved Vendors for some or all of such raw materials, components, and/or packaging in the supply of Products by the Vendor.


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4.3 SAMPLE PURCHASE ORDER

The following is a sample Purchase Order used by Wilton.

The Product “Required Date” is shown on the Purchase Order. The Product must be shipped on the “Required Date” as set forth in the Purchase Order or as specified in any agreement(s) between the Vendor and Wilton. The “Transportation and Routing” and “General Shipping Guidelines” sections of this Vendor Business Guide contain information on shipments and must be referred to before releasing any shipments. For questions on Purchase Orders and Payment Procedures, refer to the Wilton Contact List at the end of this Vendor Business Guide for the Purchasing Department representative.


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4.4 VENDOR INVOICING AND PAYMENT PROCEDURES

4.4.1 Purchase Order Processing

A) Purchase Orders should be confirmed to the Issuer within 48 hours of receipt. B) Purchase Orders must show quantity, price, delivery date, and pack size and are to be confirmed

by the Vendor. C) Deliveries will be considered “On-time” +/- 2 days from the requested Delivery Date shown on the

Purchase Order. D) Receipt of “Over-runs” will be applied to the next open Purchase Order. If no open Purchase

Order exists, Over-run quantity will not be paid for.

4.4.2 Vendor Payment Procedures A) Original Invoices from a Vendor must be sent to the following address for payment, with the

appropriate division (i.e., Wilton Enterprises, Copco, EK Success/Wilton, K& Company/Wilton, Dimensions/Wilton, Simplicity/Wilton or Wrights/Wilton) clearly indicated on all correspondence:

Wilton Industries, Inc.

Attn: Accounts Payable 2240 W. 75

th Street

Woodridge, IL 60517 B) Inquiries regarding invoices and payment are to be directed to the Accounts Payable department. C) Payment terms must be in accordance with the terms shown on the Purchase Order. D) Price paid will be price shown on the Purchase Order unless authorized in writing by issuer. The Vendor agrees (i) to render promptly after each delivery of Products a correct and complete invoice to Wilton, such invoice to include Wilton’s Item and Part number(s) and Product code(s) and quantities that apply to such invoice; and (ii) to accept payment by check or, at the discretion of Wilton with regard to specific relevant invoices, other cash equivalent (including electronic transfer of funds). The time period for payment shall not begin until correct and complete invoices are received, and any cash or quick-pay discount privileges to Wilton shall be extended until such time as payment is due. Wilton may withhold payment pending receipt of evidence, in such form and detail as Wilton may direct, of the absence of any liens, encumbrances, or claims on the Products covered by the relevant Purchase Order. Wilton shall have the right to offset against any payment it owes to the Vendor any amount owing from the Vendor to Wilton or its affiliates.


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5 TRANSPORTATION AND ROUTING

For questions on Transportation and Routing, refer to the Wilton Contact List at the end of this Vendor Business Guide for the Transportation Department representative.

A) All Purchase Orders must be routed via the Wilton Transportation and Routing

Guidelines set forth in this Section 5. B) All truckload shipments must be sealed.

5.1 CARRIER SELECTION

5.1.1 Weight Break Specifications

SMALL PARCEL SHIPMENTS 0-200 Lbs (but no more than 10 cases) please ship via Fed Ex Ground collect

LTL (LESS THAN TRUCKLOAD)

200 – 10,000 lbs (but not more than 7 pallets)

TRUCKLOAD SHIPMENTS

Greater than 10,000 lbs, 7 pallets, or 750 cu ft

5.1.2 Collect Shipments This section applies to all shipments in which Wilton is responsible for freight charges. A) Shipments must be routed according to the weight breaks designated in section 5.1.1

Do not prepay and add Collect shipments.

B) The following Carriers should be used for shipments in the LTL weight category:

Carrier Name: Origin States:

Holland: MN, IA, MO, WI, IL MI, IN, KY, OH, and TN

YRC: All other contiguous states not noted above.

*IL 150 mi radius from Chicagoland – Chicago handled by Spartacus Logistics (708) 478-1333 or Custom

Companies.


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C) Truckload Shipments: Must call Wilton Domestic Traffic Department at 815 823 8515 or 815 823 8510 or e-mail: [email protected] with shipment details to get a Wilton approved truckload carrier assigned

5.1.3 Pre-paid Shipments This section applies to all shipments in which the Vendor is responsible for the freight charges. For shipments where the Vendor is responsible for the freight charges, we prefer the use of our preferred carriers Listed in section 5.1.2 to reduce congestion at our receiving dock.

5.1.4 Wilton Distribution Center Receiving - Hours of Operation

Romeoville 1 1125 W Taylor Rd Romeoville, IL 60446 Hours: 7:00 a.m. to 3:30 p.m. (Central Standard Time) Monday through Friday Receiving Phone: (630) 810-2040 / 2030 Receiving Fax: (815) 834-9385 Romeoville 2 1010 W Taylor Rd Romeoville, IL 60446 Hours: 7:00 a.m. to 3:30 p.m. (Central Standard Time) Monday through Friday Receiving Phone: (630) 810-2147 Receiving Fax: (815) 886-6867 Shorewood 21350 S. SW Frontage Rd Shorewood, IL 60404 Hours: 7:00 a.m. to 3:30 p.m. (Central Standard Time) Monday through Friday Receiving Phone: (815) 823-8545 Receiving Fax: (815) 496-6705 WDR

2240 W. 75th Street

Woodridge, IL 60517 Hours: 7:00 a.m. to 3:30 p.m. (Central Standard Time) Monday through Friday Receiving Phone: (630) 810-2789 Receiving Fax: (630) 810-2584

Every shipment requires a delivery appointment. Delivery appointments must be scheduled at a minimum of 24 hours in advance.

5.1.5 Air Freight Shipments Domestic Shipments sent via Airfreight must be Pre-paid and requires written approval from a Wilton Division General Manager or higher, before shipping. Wilton will instruct the Vendor the expedited shipping method and the carrier to use.

mailto:[email protected]


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5.2 DELIVERY APPOINTMENTS

All domestic deliveries must be palletized according to section 6.2, and must be accompanied by documentation specifying the Wilton SKU number, SKU quantity, and the corresponding Purchase Order number(s) for the product(s) being delivered. See section 6.2.2 for Packing List details and a sample Packing List.

5.2.1 Drop Appointments

A) Arrangements can be made with domestic carriers to drop their trailers in the yard of the receiving D.C., but the Receiving Department at that D.C. must be informed 24 hours in advance of delivery. See the Wilton Contact list for the Receiving Warehouse Information.

5.2.2 Live Appointments

A) Domestic carriers must contact the Divisional Receiving Department of the appropriate D.C., a minimum of 24 hours in advance of delivery to obtain an appointment time (48 hours advance notice is preferred). A Vendor that has a regular standing appointment with Wilton is not required to give notice to the Receiving Warehouse prior to delivery.

B) Domestic carriers attempting to deliver without an appointment, or arriving late for an assigned

appointment, may not be unloaded that day and must wait for the next available open appointment time. No demurrage charges will be honored for late arrivals, or deliveries without appointment.

6 GENERAL SHIPPING GUIDELINES

6.1 CARTON PACKAGING REQUIREMENTS

For questions on Shipping Guidelines, refer to the Wilton Contact List at the end of this Vendor Business Guide for the Receiving Department representative. The following guidelines are for shipments to be received directly at a Wilton warehouse, if the Products are to be shipped to another location Wilton may provide alternative guidelines specific to such location.

6.1.1 Carton Weight Specifications Due to Wilton’s automated conveyor system and lifting considerations, all carton weights must be between the following values: Minimum weight: 1 pound (0.5 kg) Maximum weight: 50 pounds (22.68 kg)


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Cartons that do not comply with the above weight limits are considered oversize and non-conveyable and require written approval from Wilton.

6.1.2 Carton Size Specifications In addition to weight restrictions, all cartons must be between the following values:

Length Width Height Minimum: 12.5 in. (320 mm) 9.5 in. (245 mm) 4.0 in. (105 mm) Maximum: 23.5 in. (595 mm) 20.5 in. (520 mm) 19.5 in. (495 mm)

Note:

Please print carton size specifications on the side panel.

Corrugated inner and master cartons must remain consistent from shipment to shipment. The allowable tolerance for carton variances in length, width, height and/or weight is 4%. Any necessary changes must first be approved by the assigned product manager in advance of the shipment. Failure to notify the Wilton product manager in advance will result in a fine of $1000.00 per SKU, per PO for each violation.

6.1.3 Corrugated Shipping Carton Materials

The following requirements must be followed to ensure that the corrugate material that is used for shipping cartons is adequate:

Corrugate from Domestic Suppliers

Use for

Corrugated Board Type

Minimum Burst

Test

Minimum Edge

Crush Test

• Retail package • Displays • Inner packs (if the master carton is the shippable unit for retail)

Single wall

A,B,C,E & F Flute

200 lb/in

2

(1379 kPa)

32 lb/in width or 7.5

kg/cm


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• All master pack cartons. • Inner cartons that are used as “shippable inners” for retail.

Double wall

200 lb/in

2

(1379 kPa)

42 lb/in width or 7.5

kg/cm

6.1.4. Box Manufacturer Certificates for General Requirements

All corrugated inner and master cartons must have a carton manufacturer’s certificate on the outside surface, of underside flap, with a minimum of the following: A) Carton Wall Type (Single wall, Double wall, Solid Fiber, etc.). B) Minimum Edge Crush Test, Burst Test, or Puncture Test strength. C) Maximum carton size and gross weight limit (maximum weight of box and contents)

Note: the weight that is reflected on the BMC may exceed Wilton established requirements. The information provided on the box manufacturer’s certificate is in compliance with United States transportation guidelines.

D) Minimum size of 2 inches (50mm) +/- .25” (6 mm) and maximum size of 3” (76 mm) +/-.25” (6 mm). E) Name and location of the entity certifying the information See example 1 for a box manufacturer’s certificate specifying single wall with a minimum of 32 edge crush test below. The information for the box manufacturer’s certificates is published in the National Motor Freight Classification Item 222 or the Uniform Freight Classification (Rail) Rule 41. Note: In this example the numbers on the Box Manufacturer’s Certificate for size limit and weight exceed Wilton’s routing guide requirements for maximum size and weight (see Sections 6.1.1 and 6.1.2). All master cartons must meet Wilton’s minimum guidelines or require written approval from Wilton. It is preferred that the BMC is placed on the bottom of all shippers (inner and master corrugated cartons). For more examples to correctly fill in the information for the Box Manufacturer’s Certificates for various test strengths and material combinations contact Wilton Package Engineering.


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Example: (1) Single Wall 32 ECT BMC

Example: (2) Single wall and double wall 200# burst test BMC


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Image 1 Image 2

Example 3 – International Box Manufacturer’s Certificates 42 ECT Double Wall. Image 1 maximum size, image 2, minimum size. For recommendations and guidelines for carton and corrugated materials, refer to your corrugated carton distributor or to industry organizations such as:

International Corrugated Case Association available on-line at http://www.iccanet.org/ Fibre Box Association on-line at http://www.fibrebox.org National Motor Freight Traffic Association on-line at http://www.nmfta.org/ Wilton may request package integrity or material testing and certification at any time to insure sufficient protection and compliance with above specifications.

Single wall, double wall, and solid fiber cartons can be certified according to burst test (TAPPI T-810), or Edge Crush Test (TAPPI T-811). For triple wall corrugate certify using puncture testing (TAPPI T-803).

6.1.4 Products with Artwork on Exterior of Sellable Carton All SKUs that have any artwork or unique logos on the face of the carton require approval from the Product Management Department as part of all new and modified products. This process is part of the product development phase and is coordinated by the Product Management representative as specified in the Wilton Contact List. Please contact the representative for any questions.

6.1.5 Carton Size Recommendations for Bulk Product When a new product is in development stages and a set quantity is not required for the master pack shipper (i.e., it is a bulk product like flower petals) the following are recommended case pack sizes that will maximize warehouse storage space when the product is received and palletized at Wilton. The following are recommended sizes for bulk product (outside dimensions provided). Note that this does not mean other sizes cannot be used. These are guidelines for very efficient box sizes.

http://www.iccanet.org/

http://www.fibrebox.org/

http://www.nmfta.org/


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Optimum case sizes: 24 x 20 x 18.313”

16 x 10 x 11” 20 x 16 x 13.75” 20 x 13.375 x 13.75” 10 x 8 x 9.125” 16 x 10 x 4.1875” 13 x 12 x 5.5”

6.1.6 Pallet Displays Shrouds should be used to fully contain the product on the load unless it is in a pop carton (i.e., bake ware that is displayed in trays). The shroud should completely cover the product so none is exposed to theft or damage. To secure the shroud in place bands or stretch wrap should be secured around the display using enough banding or stretch wrap to keep the product fully contained. For half pallet displays preferred orientation on pallet is 24 x 40 x 60*”. Note: *60" height, includes height of pallet. If product is double stacked to deliver to Wilton, height including pallet should not exceed 51".

6.1.7 Shipping Carton Packing

The following is a series of requirements to establish how Wilton products are to be packaged.

A) Corrugate inner and master packaging must be designed and manufactured to meet the specific requirements of its content. It is imperative during the development stage of a new item that product is properly fitted to achieve maximum carton utilization. B) Accurate inside dimensions must be determined to ensure the proper fit for the product. Corrugate inner and master packaging must remain consistent (unchanged) from the first shipment and for each subsequent shipment. C) Air space: Maximum allowable free air space may not exceed 1” inch in the length, width or height dimensions. Corrugate cartons that arrive with greater than 1” or more of free air space may require a rework. All necessary materials such as corrugate, labels and labor fees will be charged back to the vendor. The vendor chargeback amount is $300 per SKU, per PO for each violation.

See the following examples of non-compliance air space, consequently, this product required expensive reworks and chargebacks to the vendor for non-compliance.


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D) Each shipping carton must protect its contents from damage during shipment, handling, and storage. Pallet configurations as well as the effects of carton weight at different pallet layers must be considered during the carton design phase. Shipping cartons on the lowest layers will be subject to higher crush factors than cartons on the top layers. E) Shipping cartons containing glass or plastic bottles must have dividers to protect merchandise from breakage, crushing, and finish damage. Internal dividers are part of the initial carton design process. F) For packaging of hazardous product, see Section 3.4.

The following shipping carton styles are allowed by Wilton:

Regular Slotted Container (RSC) Int’l Box Code 0201

Full Overlap Slotted Container (FOL) Int’l Box Code 0203

Full Telescope Design Container (FTD) International Box Code 3031

One Piece Folder (OPF) International Box Code 0401

6.1.8 Carton Sealing The following is a series of requirements to establish how cartons containing Wilton merchandise are to be sealed:

A) All corrugated cartons must be sealed using a minimum of 2-inch wide by 2-mil thick pressure sensitive polypropylene film (plastic) box-sealing tape. B) Sealing tape is to be used across the top and bottom flaps and overlap the ends of the box by at least 2” to properly seal cartons. C) Sealing tape must have adequate adhesion to resist changes temperature and humidity over reasonable periods of time. D) No cartons are to be sealed with metal or fiber banding or strapping of any kind. There are no banding restrictions on oversized, overweight non-conveyable items. See sections 6.1.1 and 6.1.2 for conveyable carton restrictions. E) No cartons are to be sealed using staples.


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F) No cartons are to be sealed using paper tape that uses a water-based adhesive.

These rules will be enforced with all Wilton Brand’s suppliers and there are no exceptions to these requirements.

6.1.9 Corrugated Shipping Carton Markings

The following section contains information on carton markings and labels. Carton markings are preferred, although pre-printed labels are allowed in instances of unique carton designs. A) All human readable information must appear on at least two (2) long carton sides. B) The Interleaved (SCC-14) 2-of-5 bar code should appear on only one (1) long carton side. This is

not required on both sides. C) Stenciling and handwriting are not acceptable. Information must be printed directly on the carton or

label. D) Cartons are preferred to be top load however, end load is acceptable. E) The Vendor Name and/or Address MUST NOT appear on any visible carton surfaces. On shipping

labels, Wilton is to be listed as the Sender. Note: Additional carton markings may apply. For more information regarding customer specific or item specific carton markings requirements, please follow up with the appropriate product manager. Refer to the illustrations below, and the following page for detailed description of each of the numbered items shown below: Flat print layout for master carton


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Illustration Details - The following print information is required for all master cartons.

Item # Description Printing Specification Other

Carton Printing

1 Item# or Sku# Must be largest print on carton Minimum size ½” (13 mm) bold

Unique (assigned for each item) ex. 2105-133

Note: Items 6A and 6B (recycling symbols) and item 3 (box manufacturer’s certificate) are not visible in this image. They should be centered on the bottom length panels.

Lot# Code

ITEM #: XXXX-XXX QTY: XX EA DESCRIPTION MADE IN ________ DIVISION: P. O. NUMBER


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1 Quantity (unit of measure)

Minimum size ¼” (7 mm) bold Must indicate the number of sellable units

1 Description Minimum size ¼” (7 mm bold) Include color, size, or unique detail

4 Country of Origin Minimum size ¼” (7 mm bold) Country the product originates from

1

Division (i.e. Wilton Industries, Copco, EK Success/Wilton, K&Co./Wilton, Dimensions/ Wilton).

Minimum size ¼” (7 mm bold) Division that the product is manufactured for

1 P. O. Number Minimum size ¼” (7 mm bold)

2 SCC-14 Master Pack/Inner Pack Label

See Sections 6.1.7, 6.1.8, and Appendix B. Required on one main panel only

Must be I 2-of-5 format on matte white back ground. Must be left justified Position a minimum of .75” from left edge and 1.25” from bottom

3

Box Manufacturer’s Certificate (Mandatory on corrugated master cartons and inner cartons)

Maximum size: 3” +/- .25” Minimum size: 2” +/- .25” (Please contact your carton manufacturer to obtain this certificate)

Center top to bottom and left to right on panel. For narrow boxes such as a full telescope or full overlap style carton place on bottom main panel in upper right corner.

4 Shipping Label Marking 1” wide x 2” tall shipping label marking – positioned 2” from bottom of carton and 3” from side

Add shipping label marking to lower right corner of main panel

5 Lot Code# Label (Mandatory for food products only)

Min size ¼” (7 mm bold) Must be left justified Position a minimum of .75” from left edge and center top to bottom.

The following print information is recommended for master cartons.

Item # Description Printing Specification Other

6A Corrugated recycles symbol See the section on recycling for notes on image size

Center top to bottom on panel and left to right on panel

6B Universal (chasing) arrows recycling symbol

See the section on recycling for notes on image size

Place centered next to the corrugated recycles symbol

6.1.10 UPC Shipping Container Code or SCC-14 (I 2-of-5) Bar Code Guidelines

The Interleaved 2-of-5 (I 2-of-5) Bar Code, also referred to as the UPC Shipping Container Code, is used to identify products which are boxed and shipped in “standard factory packs.” This code uses a packaging indicator in the first position followed by a zero a sequence of numbers reference from the UPC code.


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The I 2-of-5 symbology is capable of encoding digits 0 through 9 and requires either five bars or five spaces to represent each character.

A) Wilton is responsible for developing the I 2-of-5 numbering scheme for its different package levels and conveying this scheme to our Vendors. B) All cartons require an I 2-of-5 barcode on the lower left corner. This code is not required on the sellable product that contains a UPC bar code (see section 6.1.7). C) The I 2-of-5 bar code must be placed on one (1) side of the carton in the lower-left corner as detailed in sections 6.1.7. D) The Wilton UCC Manufacturer ID Number must be 7 digits within the I 2-of-5 bar code. E) The packaging indicator is assigned by Wilton. F) I 2-of-5 bar codes are to be applied as labels and not directly printed on the corrugated carton material. See the next section for the label specifications. G) If you have any questions on the I 2-of-5 (SCC-14) data structure, please contact the GS1 US at (937) 435-3870 or visit their website at www.GS1US.org

The following figures specify the I 2-of-5 adhesive label with example information:

Inner Pack Label Master Pack Label

Inner Pack and/or Master Pack label can be a level 10, 20, 30, 40, 50, 60, 70, or 80. You will be provided the correct level at time of new product information.

A new level will be issued in the event of:

An inner pack and/or master pack quantity change, or

A significant physical size changes to the inner pack or master pack packaging.

6.1.11 Tri-lingual Retail Packaging and Master Carton Markings (3T)

Wilton Brands has a variety of retail packaging designs to accommodate multiple languages to comply with customer requirements. This may be determined by brand, category or geographical requirements. For example, retail packaging may be designed in (English only, English/French and English/Spanish/French).

http://www.gs1us.org/


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At this time, additional carton markings are only required for items with tri-lingual retail packaging. For more information to determine if 3T applies to your items, follow up with the assigned product manager.

The criterion to determine if an item is 3T compliant includes the following: All registration symbols will appear as ®/MD. All trademark symbols will appear as TM/MC. The description near the UPC code is trilingual (English, Spanish, French). The piece count on the packaging is trilingual (English, Spanish, French). 3T Carton Markings Placement Requirements: With the first and each subsequent shipment of product utilizing the tri-lingual packaging, the master carton will require an indicator that reads 3T on the upper right side of all 4 corners of the carton in a font that is 32 or greater. This can be directly printed on the carton or may be on a sticker.

Flat print layout of a 3T master carton image

6.1.12 Fragile Markings and Directional Arrows

As a general rule, fragile markings and directional arrows should NOT be included on the inner and master cartons as a standard, and managed by exception only. The Wilton Brands Product Manager is responsible for determining if an item is considered fragile and requires fragile marks and/or directional arrows. The Wilton Brands Product Manager will provide direction to the supplier if such markings are necessary to properly protect the product during normal handling and transit. Wilton may ask our suppliers to perform drop tests as needed during the development stage or thereafter to properly determine the fragile nature of the retail product. In conjunction with Product Development, the Wilton Brands Packaging Engineer will provide the supplier with a written protocol and support to perform such testing as requested. It is critical that fragile markings and directional arrows are only used on products that require special handling and deemed fragile by the Wilton Product Manager. Using these markings and arrows inappropriately or without direction is a violation and will subject the vendor to compliance chargebacks. Fragile: Definition: An item should be considered fragile if it is likely to break or sustain damage from impact, crushing, or dropping when subjected to typical handling throughout the supply chain.


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Whether or not an item is considered fragile depends upon the combination of construction materials and design. Items made from glass, ceramic, and pottery is inherently more fragile than many other materials, but may not break easily. A small, delicate item, or even a large item with delicate features, may be fragile even when made of typically more durable material (e.g. resin, wood). Even metal products that dent easily should be considered fragile. Vendors should be the experts on the products they supply to Wilton and should apply sound judgment when determining whether or not an item is fragile. In-house evaluation can be used to determine some aspects of fragility. Example 1: If an unpackaged item is dropped three (3) times from a height of three (3) feet (one meter) onto a vinyl-clad floor surface without damage, the item should not be considered fragile, and the cartons should not be marked as such. If damage occurs, the items should be considered fragile, and the master cases and inner packs marked with industry standard fragile markings. Example 2: For master cases and inner packs, dropping the box from shoulder height (5.5) feet (1.7 meters) onto a concrete surface should result in no damage to the product contained in the carton. If the product is damaged, it should be considered fragile, and the master cases and inner packs marked with industry standard fragile marking. Examples of items that are typically considered fragile include, but are not limited to:

LIQUIDS (E.G. BUBBLES)

GLASS, CERAMICS

HOLLOWWARE DESIGNS, WHICH MAY HAVE THIN WALLS OR BOTTOMS

HEAVY CANDLE HOLDERS, LARGER CANDLES, WEDDING CAKE TOPPERS

CDU, DISPLAYS, PDQ’S

HEAVY ITEMS

CONSUMER ELECTRONICS

ITEMS WITH HANDLES OR OTHER PROJECTIONS, WHICH ARE LESS STRONG THAN THE REST OF THE ITEM

(CUPS, MUGS, TEAPOTS, ETC.)

Examples of items that are NOT typically considered fragile include, but not limited to:

TEXTILE PRODUCTS

STICKERS

FOAM PRODUCTS

PAPER (E.G. PACKED SINGLE SHEETS)

APPAREL PRODUCTS

BOOKS

Placement: Wilton requires that fragile markings be clearly and visibly marked on both the Inner carton and Master carton. Markings must be located on the FOUR largest panels of the six-sided box and we require a size no less than 10% of the largest panel.

6.1.13 Poly Bags Warning


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Due to risks of suffocation for infants and children, the following requirements must be applied to polybags used for products and/or packaging: Application: Polybags and plastic films used for Toys must have a minimum thickness of 1.5 mil (0.00150 in /

0.03810 mm). The warning listed below must be present on all polybags used for Toys that have an opening of 14 inches or more in circumference.

Polybags used for Children’s Products (not toys) must have a minimum thickness of 1 mil (0.0010 in / 0.0254 mm). The warning listed below must be present on all polybags used for Children’s Products that have an opening of 14 inches or more in circumference.

For polybags used on all other products, Wilton recommends a minimum thickness of 1 mil (0.0010 in / 0.0254 mm). The warning listed below is only required for polybags that have an opening of 14 inches or more in circumference AND a thickness of less than one mil (0.0010 in / 0.0254 mm) thick (if either condition is not met, a warning is not required to be printed on the polybag). If Wilton’s suggested minimum thickness is met, no warning is required.

Note, all polybags are required to comply with this requirement, even if not used as part of retail / product packaging. If there is a question about whether the product you are producing is classified as a “toy” or “children’s product”, please contact your Product Development contact or Wilton’s Compliance department.

Warning Requirement WARNING: Plastic bags can be dangerous. To avoid danger of suffocation, keep this bag away from babies and children. Do not use in cribs, beds, carriages or playpens. The thin film may cling to nose and mouth and prevent breathing. This bag is not a toy. MISE EN GARDE: Les sacs de plastique peuvent être dangereux. Pour éviter le danger de suffocation, ne laissez pas ce sac à la portée des bébés ni des enfants. N’utilisez pas ce sac dans un berceau, un lit, une poussette ou un parc pour enfants. La mince pellicule de plastique peut coller au nez et à

la bouche et bloquer la respiration. Ce sac n’est pas un jouet. ADVERTENCIA: Las bolsas plásticas pueden ser peligrosas. Para evitar el peligro de asfixia, mantenga esta bolsa fuera del alcance de bebés y niños. No la use en cunas, camas, cochecitos o corrales. Es posible que la película fina se adhiera a la nariz y a la boca y les impida respirar. Esta bolsa no es un juguete. Size of Warning Requirement The warning must be displayed prominently and conspicuously in bold-face type using the

following guidelines: Total length and width of bag combined

Length + Width Points

≥60" 24

40 to <60" 18

25 to <40" 14

< 25" 10

6.1.14 Aerosol Warnings

All Products and packaging containing an aerosol component need to have case markings that specifically reference ORM-D, as set forth below. These Products cannot be shipped via airfreight. Please see http://ntl.bts.gov/DOCS/hmtg.html

http://ntl.bts.gov/DOCS/hmtg.html


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6.2 PALLETIZING

6.2.1 General Handling

A) Wilton requires that all Vendors ship product on quality 48” deep x 40” wide (1,220 mm x,020 mm) 4-way pallets and must conform to the requirements in section 6.2.3.

B) Total load height, including pallet, must not exceed 60” inches. C) All pallets must be stretch-wrapped according to section 6.2.3 D) Wilton will notify a Vendor in the case of pallet shipping exceptions. E) Wilton participates in private pallet exchange programs. For questions on this program, refer to the

Wilton Contact List at the end of this Vendor Business Guide for the Receiving Department representative.

F) Product must not overhang the pallet. G) Corner Protectors must be used whenever possible.

6.2.2 Packing Lists

A separate Packing List must be provided for each Parcel and LTL or TL Purchase Order on the shipment. At a minimum, the packing list must have the following information: A) Vendor Information

B) Ship To Address (Wilton Enterprises, Copco, EK Success, K& Company or Dimensions)

C) Ship Date

D) Carrier Name

E) Carrier PRO Number

F) Invoice Number

G) Trailer Number

H) Wilton Stock Number

I) Wilton Stock Description

J) Purchase Order Number - group items by Purchase Order Number

K) Number of Cartons shipped for each Wilton Stock Number

L) Total number of Eaches

M) Gross Weight

N) Unit of Measure for the above


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A sample Packing List:

PACKING LIST

VENDOR NAME Freight Trems: PPD

VENDOR STREET ADDRESS

VENDOR CITY, STATE, ZIP

VENDOR PHONE NUMBER

VENDOR FAX NUMBER

VENDOR EMAIL ADDRESS (If applicable)

Sold To: Ship To:

Wilton Industries, Inc. WILTON DIVISION

2240 West 75th Street DIVISION STREET ADDRESS

Woodridge, IL 60517 DIVISION CITY, STATE, ZIP

WILTON PO Ship Date Carrier Pro Number Page

123456 01/01/2000 RPS 1

Eaches Cases Eaches Cases

Wilton Stock Number Ordered Ordered Shipped Shipped Item Description

1912-2347 12 EA 1 CASE 12 EA 1 CASE CLEAR LOLLIPOP BAGS

415-307 12 EA 2 CASE 6 EA 1 CASE PARTY CUPS

415-306 6 EA 1 CASE 6 EA 1 CASE PARTY CUPS

2113-2317 3 EA 1 CASE 3 EA 1 CASE DOLL PIK

2811-246 6 EA 1 CASE 6 EA 1 CASE CANDLES - 10 PACK

704-212 3 EA 1 CASE 3 EA 1 CASE ICING TUBE

1103-62 6 EA 1 CASE 6 EA 1 CASE NEWBORN BABY - 6 PACK

710-3000 18 EA 3 CASE 6 EA 1 CASE ICING DECORATIONS

703-1266 6 EA 3 CASE 6 EA 3 CASE CAKE SPARKLES



2310-613 2 EA 1 CASE 2 EA 1 CASE COMFORT-GRIP FLOWERS

710-3206 6 EA 1 CASE 0 EA 0 CASE ICING DECORATION

2811-231 6 EA 1 CASE 6 EA 1 CASE CANDLE COMBO PACK

(Any Special Instruction would be here)


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6.2.3 Straight Bill of Lading The following are the minimum requirements for the Straight Bill of Lading for each Purchase Order: A) Date Shipped

B) Shipping Point, expressed in City, State, Zip Code, and Country format

C) Final Destination, expressed in City, State, Zip Code, and Country format

D) Carrier PRO Number and Bill of Lading Number

E) Vendor Information

F) Purchase Order Number

G) Prepaid or Collect

H) Carrier Name

I) Trailer Number

J) Seal Number, if applicable

K) Total number of Cartons

L) Total number of Pallets

M) Total Load Weight

N) Description and details of any Hazardous Material per DOT regulations

O) Any special shipping instructions

A sample of a straight Bill of Lading is shown on the next page.


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PRO Number would

be affixed here

Enter Carrier Name

1/1/2001

ABC Vendor

Vendor Street

Vendor City, State, Zip

(Division)-Wilton Industries

Division Street

Division City, State, Zip

Wilton P.O. Number

Total Weight # of ctns Description of item (s)

As Applicable

Signature Required

CARRIER MUST CALL FOR DELIVERY APPOINTMENT

MINIMUM 24 HRS IN ADVANCE. Required


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6.2.4 Shipping Pallet and Load Wrapping Requirements

Wooden Pallet Requirements The purpose of this policy is to establish the minimum standard of what is considered an acceptable pallet. The following specifies the requirements of HARDWOOD wooden pallets used for receipt of all domestic products.

Minimum Standard for Grade AAA - #1 Pallet A) The wooden pallet dimensions are to remain within the following limits:

Minimum Length: 47 ½ inches (1,210 mm) Minimum Width: 39 ½ inches (1,005 mm) Maximum Length: 48 ½ inches (1,230 mm) Maximum Width: 41 ½ inches (1,050 mm) Maximum Weight: 60 pounds (27.2 kg) Depth Range: 4.0” – 5.0” (102 mm – 130 mm)

Dimensions: 48” x40”

Open on the 40” side, with 4-way slots on the 48” side

Double-faced (boards on the top and bottom of the pallet)

Non-reversible (only one side may be considered the top)

Flush Type (no over-hang of top boards)

Stringers: Three 2”x4”x48” 4 way boards

Top Deck: Minimum ½” thick decking, with maximum spacing between boards of 4”

Bottom Deck: Minimum ½” thick decking with 3 center boards

6” bottom and top lead boards

No extensions (making a 48” pallet from a 44” pallet)

Top & bottom deck boards must be continuous from side to side

No exposed nails

Only one center stringer positioned at the center of the pallets width

Only nail construction (no staples or glue)

No foreign substances

No boards from CHEP pallets, or any other color coded pallet Any exceptions to the above requirements require approval from the Receiving Warehouse prior to shipment. See the Wilton Contact List.


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Stretch Wrapping A) All product delivered to Wilton must be stretch-wrapped. B) The stretch wrap must secure the product and not allow shifting or bowing and must be secured to

the pallet. C) Automatic stretch wrapping is preferred. Do not use tape, twine, bands, or nylon rope, in addition to,

or instead of, stretch wrap. However, Customer Display Units (CDUs) may be banded. D) Colored or tinted stretch wrap is not acceptable unless Wilton has specified it for security reasons.

E) Size: Manually Applied Automatic

18 inch width (455 mm) 20 inch width (510 mm) 60 gauge thickness 80 gauge thickness

F) Type: Clear, Polyethylene G) Pre-stretch: Medium to High (up to 175 %) H) Wrap Quantity: Top and Bottom layers require 3 complete wraps

Middle layers require a minimum of 3” over-lap with NO GAPS:

6.2.5 Single-SKU Pallet Loads

A) All pallet loads are restricted to a height of 60 inches (152 cm) including pallet. B) All single-SKU pallet loads should be stacked in an inter-locking method, as shown below, to

optimize the stability of the load.


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Inter-locking Stack Column Stack

Preferred Acceptable

The preferred method to stack loads is to interlock them; provided, however, column stacking is also acceptable for heavy loads.

6.2.6 Multiple-SKU Pallets

If multiple SKUs are shipped on one pallet, the following requirements apply: A) Like SKUs must be kept together (see sample drawing below). B) Product on pallet must be stacked so that the largest and/or larger quantity cartons are on the

bottom layer and the stacking is uniform so as not to create an unstable pallet load. C) Cartons of the same items from the same Purchase Order must be kept together on one pallet.

Cartons from any one item must not be spread across different Multiple-SKU pallets. D) Slip-sheets must be used to separate SKU layers whenever possible. If slip-sheets are not available,

flat corrugated is appropriate. E) Interlock SKUs if possible to preserve the load’s integrity. F) Pallets containing mixed SKUs must be marked “MIXED PALLET”.


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6.2.7 Multiple - Purchase Order Pallets A) It is allowable to combine more than one Purchase Order on a single pallet given that each Purchase

Order is separated and segregated by slip-sheets. B) When Purchase Orders are separated on a mixed pallets, the different Purchase Orders must be

identified with a label or header to clearly identify the: 1) The Purchase Order Number 2) The number of cartons within that Purchase Order.

C) As stated in section 6.2.5, cartons from the same Purchase Order cannot be spread across different mixed pallets.

6.2.8 Loose Carton Shipments

Loose cartons should not be placed on top of a palletized SKU. If there are extra cartons they must be independently palletized and marked with the appropriate pallet label.

6.2.9 Customer Display Units A) There are no height or size restrictions for Customer Display Units B) All display pallets must have one label or header stating “Customer Display Unit”, and must be placed

on the front of the pallet.


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6.2.10 Over-sized Pallets A) Over-sized Pallets must not be used unless an individual carton overhangs a 48” x 40” 4-way pallet

and written approval on the over-size dimension(s) has been granted by Wilton. See section 6.1.2 for carton size limits.

B) Over-size pallet loads must be marked “Over-size Pallet” with a label or header and must be placed on the front of the pallet. Any oversize pallets must conform to the center stringer and width restrictions stated in section 6.2.3.

6.2.11 Slip Sheets A) Slip-sheets are not to be used in place of wooden pallets, unless directed by Wilton. B) Slip-Sheets that are used to separate layers or protect the top of pallet loads must measure no larger

than the pallet. Any slip-sheets that are used must have the flaps folded so that they will not protrude past the pallet when the shrink-wrap is applied.

C) Slip-sheets made of standard corrugated or paperboard construction are acceptable.

6.2.12 Exceptions to Palletization Requirements Some merchandise is not appropriate for palletization. Examples include UPS, RPS and other small-parcel shipments and need not be palletized. If The Vendor believes that palletizing a product / shipment is inappropriate due to additional transportation freight expenses and/or cubing inefficiency, the Vendor should contact Wilton’s Receiving Department representative for an exception.

6.3 PARCEL AND PALLET SHIPPING LABELS

6.3.1 Parcel Shipments Shipped Carton Count – this information must be on each Parcel Shipping Label near the Purchase Order Number and Item Number Information. The first value must be the carton number, followed by “OF”, and the last value is the total number of cartons shipped on the respective Purchase Order. For example, if a Purchase Order contains 5 shipped cartons, the labels must read: “1 of 5”, “2 of 5”, “3 of 5”, “4 of 5”, and “5 of 5”, respectively. Placement of Shipping Label on Parcel The shipping label must be placed on the longest side opposite the carton markings as shown in the following diagram. The label must be located in the lower left-hand corner of the appropriate side as shown in the diagram:


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6.3.2 Floor Load Shipments Domestic Vendors are prohibited from floor-loading shipments unless written approval has been granted from Wilton.

6.3.3 LTL Pallet Shipments Pallets and Customer Display Units must have an 8 ½” x 11” (215 mm x 280 mm) pallet header as shown in the following diagram:

Deliver To: Wilton Division (50 –pt. Font or ¾ inch) Wilton Industries Division Street Division City, State, Zip

STOCK #: Wilton P.O. Number (50 –pt. Font or ¾ inch) Carton Quantity (quantity on pallet)

(50 –pt. Font or ¾ inch)


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6.3.4 Pallet Header Placement

The pallet header must be placed on two adjacent sides of the pallet: the 40” FRONT of the pallet, and any 48” ADJACENT SIDE of the pallet as shown:

The pallet headers must be applied to the pallet BEFORE any stretch wrapping is applied.

6.4 TRAILER LOADING

6.4.1 Small Package Shipments

Product shipments are to be palletized according to Section 6.2, except for parcel carriers such as UPS, RPS, and Federal Express. The Vendor shall be responsible to ensure carriers adhere to the shipping requirements set forth in this Section 6.4, except for parcel carriers such as UPS, RPS, and Federal Express.

6.4.2 Trailer Shipments (TL and LTL) A) All document requirements are specified in sections 6.2.2, 6.2.3, and 6.4.

B) The pallets must be positioned so that the Pallet Headers are visible from the entrance of the trailer. If pallets are rotated 90 degrees to allow better cubing, the position of the headers and labels must still be viewable from the front.


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C) Pallets must be staggered when loading trailers, as in the following figure, to ensure proper pallet inter-locking. This interlocking will limit the amount of shifting in transit and limit product damage.

D) Carriers are responsible for using Load Braces prior to closing the trailer to prevent pallets from shifting rearward. If multiple Wilton divisions are loaded on the same trailer, place the division with the largest order size in the nose of the trailer and the smallest order size in the tail to allow quick unloading of small division orders.

E) An option to staggering loads is to use air bags to cushion the load as shown below:


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F) DO NOT load pallets to one side of the trailer, as shown below, since this will create an unstable trailer and will affect the trailer’s handling characteristics in transit.

7 DESIGN SOFTWARE

7.1 ADOBE CREATIVE SUITE (CS6)

In an effort to keep up to date with computer technology and standardization between companies, Wilton requires its Vendors and business partners to use Adobe Creative Suite (CS6) for design purposes. Adobe Creative Suite 6 (CS6) is a collection of graphic design, video editing, and web development applications made by Adobe Systems. The collection consists of Adobe's applications (e.g., Photoshop, Acrobat, InDesign), that are based on various technologies (e.g., PostScript, PDF, Flash). The latest version, Adobe Creative Suite 6 (CS6).

http://en.wikipedia.org/wiki/Graphic_design

http://en.wikipedia.org/wiki/Video_editing

http://en.wikipedia.org/wiki/Web_development

http://en.wikipedia.org/wiki/Application_software

http://en.wikipedia.org/wiki/Adobe_Systems

http://en.wikipedia.org/wiki/Photoshop

http://en.wikipedia.org/wiki/Adobe_Acrobat

http://en.wikipedia.org/wiki/InDesign

http://en.wikipedia.org/wiki/PostScript

http://en.wikipedia.org/wiki/PDF

http://en.wikipedia.org/wiki/Adobe_Flash


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8 NON-COMPLIANCE AND CHARGE BACKS

8.1 PROCESS OVERVIEW

All areas of this Vendor Business Guide have been reviewed from a financial standpoint to determine the minimum administrative and operational expenses that 1) Wilton must bear in order to correct vendor non-compliance violations as defined by this Vendor Business Guide and 2) the minimum incentive cost that can reasonably be charged to a Vendor to correct its non-compliance’s to avoid any future infringements. In the case of a compliance issue, the Vendor will be contacted as soon as possible by Wilton, so that the Vendor can immediately correct any pending shipments. Any administrative and incremental charges resulting from compliance issues will be automatically deducted from the invoice amount at the time of next payment. A report explaining the non-compliance will accompany the payment. For general questions on non-compliance’s and charge-back fees, refer to the Wilton Contact List at the end of this Vendor Business Guide for the non-compliance representative. A Vendor who seeks to contest non-compliance charge backs must submit its dispute, in writing, to the Supply Chain Management Department, located at the Wilton Headquarters address as shown on the Wilton Contact List. The non-compliance reference number should be noted on all correspondence. In addition to the Chargeback fees and other rights as described herein, if the Vendor fails to perform or comply with this Vendor Business Guide, Wilton may pursue any and all other remedies available at law or in equity, including, but not limited to, seeking damages, including attorneys’ fees and court costs, specific performance, injunctions, or any combination of these. No right or remedy provided herein or permitted by law or in equity is exclusive of any other. All such rights and remedies will be cumulative and may be enforced concurrently or individually from time to time.


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8.2 SAMPLE VENDOR COMPLIANCE CHARGEBACK

March 1, 2011 Contact Name (Wilton Information) Company City, State, Country, Province

VENDOR COMPLIANCE CHARGEBACK NOTIFICATION

Wilton requires its Vendors to follow Purchase Order, Packaging, Bar Coding, Routing, Shipping, and Certificate guidelines as outlined in the Wilton Vendor Business Guide. Recently, a shipment received from your company did not conform to these guidelines. The details, as well as the appropriate reason codes are shown below. Please cross-reference the reason code to determine the exact requirement sections that apply. The compliance charges will be automatically deducted from the scheduled payment. NON-COMPLIANCE NUMBER: 123456789 DEDUCTION AMOUNT: $ 300.00 REASON CODE: 609 Cartons are not to be sealed using staples PO NUMBER: 123456789 DATE RECEIVED: 1/1/2001 WILTON DIVISION: COPCO WILTON MODEL NUMBER(S): 1234-1234, 5678-5678 CARTONS IN SHIPMENT: 200 CARTONS NON-CONFORMING: 200 COLLECT/PREPAID: Collect BILL OF LADING NUMBER: 12345 CARRIER: ROADWAY PRO NUMBER: 1234567891234 TRAILER NUMBER: 12345 NOTES:


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8.3 COST RECOVERY CHARGEBACK SCHEDULE

8.3.1 Transportation and Routing

Code Guide Requirement Guide

Section Non-compliance Action

101 All truckload and foreign container shipments must be sealed.

5 $ 1.00 per carton + $ 250 processing fee chargeback

102 Domestic shipments sent Collect to Wilton must use Wilton-specified LTL carrier for shipments over 150 lbs.

5.1.2 $ 1.00 per carton + $ 250 processing fee chargeback

103 Domestic Vendors do not Pre-pay and add shipping charges to Shipments.

5.1.2 $ 1.00 per carton + $ 250 processing fee chargeback + additional freight charges

104 Domestic shipments sent Collect to Wilton via Air Freight must have written approval from Wilton General Manager or higher.

5.1 $ 250 processing fee chargeback + Air Freight Charge

105

Domestic carriers must contact the Divisional Receiving Department of the appropriate D.C. a minimum of 24 hours in advance of delivery to obtain an appointment time (48 hours advance notice is preferred)

5.2.1

$ 250 Processing fee + $100 Flat Fee. Any charges incurred over the $100 flat fee by Wilton will be charged back to the vendor.

106 Not Applicable

All charge backs may be subject to additional costs

8.3.2 General Shipping Guidelines



201 Domestic Vendor Cartons must conform to this Vendor Business Guide corrugated requirements.


202 Cartons must be sealed adequately with sealing tape. Strapping and staples are not to be used.

6.1.6 $ 1.00 per carton + $250 processing fee chargeback

203 Carton markings and Carton Specifications must comply with this Vendor Business Guide.


204 Product must arrive at Wilton free of damage. 6.1.5 $ 250 processing fee plus + $100 flat fee

205 The product quantities shipped must match the Purchase Order (no shortages or overages).

4.4.1 $ 250 processing fee plus +$100 flat fee

206 The product Unit of Measure must match the Purchase Order

4.4.1 $ 250 processing fee plus $100 flat fee


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8.3.3 Bar Codes



301 The UPC bar code must be on the outside of all Wilton retail sellable units.

Appendix A

$ 250 to $500 processing fee will apply plus labor rework cost

302 UPC must be of proper quality and conform to this Vendor Business Guide.

Appendix A

$ 250 to $500 processing fee will apply plus labor rework cost

303 The I 2-of-5 bar code must be placed on 1 side of the carton

6.1.8 $ 250 to $500 processing fee will apply plus labor rework cost

304 The I 2-of-5 bar code must be of proper quality and conform to this Vendor Business Guide.

6.1.8 $ 250 to $500 processing fee will apply plus labor rework cost

8.3.4 Palletizing/container loading



401 A Packing List must accompany all shipments and contain the information specified in this Vendor Business Guide

6.2 $ 250 processing fee + $100 Flat fee

402

A Bill of Lading must be supplied for each Domestic LTL or TL shipment order and contain the information specified in this Vendor Business Guide

6.2 $ 250 processing fee +$100 Flat fee

403

Wooden Pallets on Domestic shipments must be good 40”x 48” 4-way and meet the requirements of this Vendor Business Guide.


404 All Domestic pallet loads must be stretch-wrapped according to this Vendor Business Guide

6.2.3 $ 250 processing fee chargeback +$100 Flat fee

405 All Domestic pallet loads are restricted to a height of 60 inches

6.2.4 $ 250 processing fee +$ 100 Flat fee

406 On Domestic multiple-SKU pallets, like SKUs must be kept together and the pallet must be marked “MIXED PALLET”.

6.2.5 $250 processing fee + $100 flat fee

407

On Domestic shipments, product must not overhang pallets and must be properly stacked to avoid product damage and preserve load stability.

6.2 $ 250 processing fee + $100 Flat fee


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8.3.5 Shipment Labeling



501 Domestic shipments cannot be floor-loaded. 6.4.2 $ 1.00 per carton + $ 250 processing fee chargeback

502 Domestic pallets loads must have an 8 ½” x 11” pallet header as required in this Vendor Business Guide.

6.3.4 $ 250 processing fee +$100 Flat fee

503

On Domestic shipments, a visible pallet header must be placed on a minimum of 2 adjacent sides, and be placed under the shrink-wrapping.

6.3.4 $ 250 processing fee +$100 Flat fee

8.3.6 Pest Infestation



701 Shipments must not arrive with pest infestation nor require pest fumigation.

11 Cost of fumigation + $ 300 processing fee chargeback

702 Not Applicable


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9 VENDOR QUALITY ASSURANCE

To assure the highest level of inventory integrity and shipment accuracy, incoming shipments are subject to inspection by Wilton’s Quality Assurance Department. Incoming product is either 100% or lot-sample inspected and the quantity and level of inspection is dependent upon the variability of the product’s attributes and the quality history of the Vendor, according to Wilton’s Quality Control records. The Quality Control department has the authority to place product in “hold” status, thus preventing any of the suspect products to enter the order fulfillment process. It is important that the Vendor’s provide product that conforms to the Specifications (as defined below), the Legal Requirements, and the other terms of this Vendor Business Guide. Orders not conforming to the Specifications are subject to rejection of part or all of the shipment and this may result in delays in Wilton’s order fulfillment process and payments to a Vendor. Fines due to rejected shipments may also apply according to the Wilton compliance requirements. Wilton encourages Vendors to seek any required assistance from Wilton if products cannot be delivered as required. For questions on product specifications, refer to the Wilton Contact List at the end of this Vendor Business Guide for the Product Management representative. The Product Manager responsible for a Product will maintain the Specifications for that Product.

9.1 PRODUCT SPECIFICATIONS AND QUALITY

All Products provided by the Vendor hereunder must be produced in strict compliance with the written specifications (including raw materials and components to be used) issued by Wilton for the Products, including the Quality Standards as defined in this Vendor Business Guide (individually or together, the "Specifications"), the Legal Requirements, and the other terms of this Vendor Business Guide; provided, however, that Wilton may revise all or some of the Specifications from time to time, and any such revised Specifications shall be the “Specifications” referenced in this Vendor Business Guide. The Vendor shall receive reasonable prior written notice of any such superseding Specifications and the Vendor agrees to make all such changes promptly. The Vendor acknowledges that the Specifications, including the Quality Standards, may include standards and requirements more restrictive than applicable Legal Requirements and in such case the Vendor shall comply with the more restrictive provisions of the Specifications and Quality Standards. The Vendor must have an effective program to ensure that any suppliers it utilizes to provide any goods or services that will be incorporated into Products will be in conformance with the requirements set forth above. The Vendor will only use accredited testing facilities that have been approved by Wilton in writing. Wilton will identify the jurisdictions (such as but not limited to the United States, Canada, or the European Union) where the Products are intended to be sold, provided that notwithstanding the jurisdiction of ultimate sale to consumers, Wilton may, in its sole discretion, require that the Products conform to Legal Requirements of additional jurisdictions. The Vendor will provide samples of each Product, its packaging, and if requested by Wilton, raw materials used, in each case free of charge (the "Samples"). Samples shall be produced from production Tooling (as defined below) and must conform to the Specifications, Quality Standards, Legal Requirements, and the other terms of this Vendor Business Guide. The Sample and the final Product must be manufactured at a factory approved in writing by Wilton. The Samples may be inspected by Wilton and the Vendor will be advised of changes, if any, which need to be made before production, and/or packaging of Products


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may be commenced. The Vendor will provide a list of service parts if requested by Wilton. In the event the Samples differ from the Specifications as a result of the written direction of Wilton, then the final approved Samples shall be deemed to modify the Specifications to which the Products shall strictly conform, and the Specifications so modified shall be the “Specifications” referenced in this Vendor Business Guide. The Vendor must obtain the prior written consent of Wilton before making any improvements, modifications, or changes to any of the Products, including but not limited to the raw materials and components used in the Products. Wilton may grant or withhold its consent to such substitutions, improvements, modifications, or changes, in its sole discretion. In the event the Vendor makes any such improvements, modifications, or changes to any of the Products, the Vendor will send to Wilton the details on such changes with sufficient detail in order for Wilton to make appropriate changes to the Specifications, and shall provide such other information requested by Wilton in connection with such improvements, modifications, or changes to any of the Products. Each Product or packaging for such product shall be labeled, including having the warning labels, required under the Specifications, Legal Requirements, and the other terms of this Vendor Business Guide. The Vendor agrees to allow Wilton and its representatives or their authorized agents at any and all times during regular business hours to enter the Supplier's premises to inspect the premises, raw materials, components, Samples, the manufactured Products, the means for manufacturing Products, and other items related to the supply of Products, including, but not limited to, all documentation related to the Products, facility procedures, and compliance with the Specifications, Quality Standards, Legal Requirements, and the other terms of this Vendor Business Guide, and the Vendor’s records relating to any of the foregoing, including any and all of the Vendor’s test data. The Vendor is responsible for correcting any deficiencies identified by Wilton’s inspection prior to any further the production and delivery of the Products. The Vendor agrees to maintain, and provide copies to Wilton if requested, test data documentation that shall accurately (i.e. free from any attempt to falsify or mislead) measure and ensure compliance with the Specifications, Quality Standards, the Legal Requirements, the other terms of this Vendor Business Guide, as well as the other matters Wilton may request in writing from time to time. For each Product, the Vendor shall maintain such test data documentation for a period of six (6) years from the date of the final shipment of Products. The Vendor shall comply with all Quality Standards specified by Wilton, and from time to time Wilton may conduct additional testing of the Products or of Product samples provided by the Vendor, free of charge, to ensure that the Products satisfy the Specifications and Legal Requirements. The Vendor agrees that it will perform all manufacturing and assembly operations itself to produce the Products at factories approved in writing by Wilton, and that it will not subcontract all or a portion of the manufacture or assembly of the Products unless the Vendor obtains Wilton's prior written approval. The subcontracting of any work hereunder, if permitted by Wilton, shall not relieve the Vendor from its obligations hereunder. Vendor is responsible for notifying Wilton of any plans for change of manufacturing locations. All shipments must be received at the Wilton Receiving Department according to the requirements set forth in this Vendor Business Guide. Shipments that are received in condition other than required can lead to delays for both Wilton and the Vendor, and ultimately result in possible delays in providing Wilton customers with their required orders. This Vendor Business Guide must be consulted before product


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shipments are released. Please refer to the non-compliance section of this Vendor Business Guide for explanations and charge-backs for shipments that are not received according to the requirements under this Vendor Business Guide. In the event that the Vendor provides the claims regarding the Products (e.g., claims regarding performance of the Products or benefits the user of the Products receives), the Vendor shall substantiate all claims made by the Vendor with respect to the Products. Such substantiation shall be provided to Wilton with the Samples and shall demonstrate that such claims are compliant with all applicable Legal Requirements including, but not limited to, U.S. Food & Drug Administration, Federal Trade Commission and European Union regulations. In the event that there is not an Approved Vendor for packaging and the Vendor provides the packaging, the Vendor represents and warrants that the packaging is in compliance with any and all Legal Requirements, including environmental labeling, reporting, disclosure, and registration requirements, and the other terms of this Vendor Business Guide. In the event that Wilton provides the packaging for Products, the Vendor agrees that it will not use Wilton’s packaging in any manner except in connection with the manufacture of the Product. If Wilton does not provide the instruction manual and literature for the Products, the Vendor shall provide an electronic copy of the final version of the instruction manual and all literature that addresses the use and care of the Product. This electronic file must be in a PDF format or in Adobe Acrobat software.

9.2 TOOLS

All Tools furnished by Wilton, either directly or indirectly, to the Vendor to perform any Purchase Order, or for which the Vendor has been reimbursed by Wilton shall be and remain the property of Wilton. Wilton’s Tools shall at all times be properly housed and maintained by the Vendor and shall not be used by the Vendor for any purpose other than the manufacture of Products to be sold to Wilton under this Vendor Business Guide.

If Wilton rejects the first shipment of production Products because of a problem attributable to defects in Tools procured by the Vendor and the Vendor is unable to correct such defects within a reasonable time not to exceed 60 days, the Vendor shall be required to purchase the Tools from Wilton (if the Tools were directly or indirectly paid for by Wilton) at a price equal to all payments made by Wilton in respect of such Tools. Wilton shall have the right to enter onto the Vendor's premises at any reasonable time to inspect the Wilton’s Tools and the Vendor's records with respect to such Tools. At Wilton's request, all such Tools shall be marked or labeled to identify them clearly as Wilton's. The Vendor at its own expense shall furnish, maintain, keep in good condition, and replace when necessary all tools, dies, molds, fixtures, equipment, and other items necessary, if any, for the production of the Products (the “Tools”), including Wilton’s Tools (as defined below) unless Wilton otherwise agrees in writing. The Vendor will provide Wilton with a list of Tooling and the drawing for each such Tool. All Tools furnished by Wilton, either directly or indirectly, to the Vendor to perform under this Vendor Business Guide or any Purchase Order, or Tools paid for or agreed by Wilton in writing to be paid for by Wilton (whether or not the full purchase price has been paid) (the “Wilton’s Tools”) shall be and remain the property of Wilton. All such Wilton’s Tools shall be marked or labeled to identify them clearly as Wilton's. The Vendor shall insure the Tools pursuant to Section 6 of Wilton Standard Purchase Agreement and Conditions (set forth in Section 4.1 of this Vendor Business Guide) for the replacement of such Tools. The Vendor shall keep Wilton’s Tools free and clear of all liens and encumbrances. Wilton


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shall have the right to file a security interest upon Wilton’s Tools and the Vendor shall cooperate with the reasonable request of Wilton in filing and perfecting such security interest. The Vendor grants Wilton an irrevocable option to take possession of and/or title to the Tools that are special for the production of the Products. Wilton’s Tools shall not be used by the Vendor for any purpose other than the manufacture of Products to be sold to Wilton under this Vendor Business Guide. Upon the request of Wilton, the Vendor shall immediately release Wilton’s Tools to Wilton and shall transport and deliver such Tools F.O.B. to the destination as specified by Wilton, by such means and method as Wilton shall specify. In such case, Wilton’s Tools shall be properly packed and marked in accordance with the requirements of the carrier selected by Wilton to transport such property. Upon request of Wilton, the Vendor will destroy Wilton’s Tools, at no cost to Wilton, in accordance with Wilton’s written instructions. The Parties understand and agree that at all times during the Term hereof the Vendor shall bear the risk of loss with respect to the Tools, and Wilton’s Tools in its possession or control. The Vendor will, at no cost to Wilton, offer all assistance, provide samples and make any changes to Tooling so the Products will meet the various Legal Requirements and the other terms of this Vendor Business Guide. In the event of a force majeure condition, the Vendor, upon the written request of Wilton, will provide the Tools (including Tools owned by the Vendor) and/or any designs owned by the Vendor to Wilton or its designee and Wilton shall have the right to immediately produce the Products at another manufacturer during the force majeure event. In the event that the Tools and/or design are owned by the Vendor, Wilton and the Vendor shall negotiate a reasonable royalty payment to the Vendor for such use. However, the transfer of Tools and/or design shall not be delayed by such negotiations being commenced or completed. The obligations under this Section 9.2 shall survive expiration or other termination of a Purchase Order or the discontinuance by Wilton of a Product.

9.3 PRODUCT INSPECTIONS

When new Products (products that have not been shipped to Wilton’s customers in any prior shipments) arrive at the Wilton Receiving department, the Product is subject to 100% inspection. Once the Wilton Product Management Department has inspected the Product, the new Product is released to inventory and is available for the order fulfillment process. All Products are subject to inspection and acceptance or rejection. In doing so, Wilton may utilize lot-sample inspections based on the SKU and inspection requirements set forth by the Wilton Quality Control Department. Examples of SKU attributes, which are subject to inspection, are:

A) Carton Integrity and Markings B) Carton artwork, if applicable


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C) Master pack or Inner packs quantities D) Physical characteristics such as color, blemishes, damage, etc. E) SKU Model Number F) SKU UPC / EAN Bar Code G) SKU I 2-of-5 Master pack Bar Code

The Vendor agrees that the Products shall be acceptable to Wilton as to compliance with the Specifications. The Vendor and the Products shall comply, at the Vendor’s own cost, with all Quality Standards. Any failure to meet these requirements will be the responsibility of the Vendor. The Vendor will establish and maintain appropriate test and inspection procedures to ensure compliance with the Specifications, the Quality Standards, the Legal Requirements, and the other terms of this Vendor Business Guide. From time to time Wilton may conduct additional testing of the Products or of Product samples provided by the Vendor, free of charge, to ensure that the Products satisfy the Specifications, including the Quality Standards, the Legal Requirements, and the other terms of this Vendor Business Guide. Wilton shall have the right to inspect and reject Products both prior to shipment and at the ultimate destination. Inspection of Products by Wilton whether during manufacture, prior to delivery, or within a reasonable time after delivery, and whether at the Vendor’s facility or at any other location, shall not constitute acceptance of any work-in-progress or of any finished goods. Further, payment for non-conforming Products shall not constitute acceptance of such Products, shall not limit or impair the right of Wilton to assert any legal or equitable remedy, and shall not relieve the Vendor of the responsibility for defects. The Vendor is responsible for collection of or direction for disposal for non-conforming Product, at the Vendor’s expense. Wilton shall have the right to inspect and reject Products both prior to shipment and at the ultimate destination. Based upon its inspection and testing at its ultimate destination, Wilton may reject any shipment or part thereof which in the discretion of Wilton does not meet all of the Specifications, the packaging requirements, the Quality Standards, or any other term or condition of this Vendor Business Guide. Wilton shall not be deemed to have accepted any shipment of Products and Wilton shall be entitled to a refund of the purchase price (including the cost of transporting the Products from the Purchase Order delivery point to Wilton's final inspection point) paid for any shipment of Products which are rejected. Inspection of Products by Wilton whether during manufacture, prior to delivery, or within a reasonable time after delivery, and whether at the Vendor’s facility or at any other location, shall not constitute acceptance of any work-in-progress or of any finished goods. Further, payment for non-conforming Products shall not constitute acceptance of such Products, shall not limit or impair the right of Wilton to assert any legal or equitable remedy, and shall not relieve the Vendor of the responsibility for latent defects. The Vendor is responsible for arrangement of transport and cost of shipment for Products shipped to replace rejected Products as a result of the Vendor’s act or omission. The Vendor will be liable for any Losses incurred by Wilton resulting from such act or omission. The Vendor is responsible for collection of or direction for disposal for non-conforming Product, at the Vendor’s expense. The Vendor must obtain the prior written consent of Wilton for alternate Product substitution.


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9.4 SUSPECT SHIPMENTS AND PRODUCT REWORK

If shipments received by the Wilton Receiving Department are suspected of quality non-conformance by the Wilton Quality Control Department, the Product in question is placed on Quality Hold and is not available for allocable inventory. If the Product does not meet the requirements set forth by both the Quality Control and the Product Management Departments, the Product may be rejected for receipt and returned to the Vendor for either rework or complete replacement of the Product. If it is agreed by both Wilton and the Vendor that Wilton may rework the rejected Product, the Vendor will be charged for any labor, material, and service expenses incurred to rework the Product to meet the set requirements. Additional administrative fees and fines may apply. No right or remedy provided herein or permitted by law or in equity is exclusive of any other. All such rights and remedies will be cumulative and may be enforced concurrently or individually from time to time.

10 MATERIAL SAFETY DATA SHEETS (MSDS)

Under the Hazardous Communication Standard (HCS), OSHA requires that distributors of products containing hazardous materials provide a copy of the MSDS to the customer either before or at the time of sale. If a product having an MSDS is being sold to Wilton, each Vendor must either 1) send a copy of the MSDS containing your stock number, with the product shipment, or 2) send a copy to the Wilton Safety Manager (see Wilton Contact List). In addition to OSHA regulations, each Vendor must comply with U.S. Department of Transportation Regulations (Code of Federal Regulations, Title 49, Part 170-179) and all applicable international regulations concerning packaging and transporting hazardous materials. For questions on MSDS, refer to the Wilton Contact List at the end of this Vendor Business Guide for the Safety Department representative.

11 PEST INFESTATION

11.1 DOMESTIC SHIPMENTS

It is the policy of Wilton that all inbound trailers are inspected for pest infestation and irregular odors and fumes upon receipt by the receiving personnel. If any shipments are suspected of infestation or odors, the trailer will be closed and removed from the Wilton Receiving and Storage areas and quarantined at a safe distance from the building.


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Examples of Infestation signs are: Examples of Irregular odors or Fumes are: Chewing Pesticide Spraying Droppings Coffee Grounds Nesting Chemicals Dead Rodents and/or Insects Contracted Pest Control specialists will fumigate the suspect container according to local, EPA, USDA, APHIS, and other applicable domestic and international regulatory agencies. All expenses will be charged back to the Vendor in addition to any administrative and incremental charges per the Non-compliance Charge-back Schedule.

12 WILTON CONTACT LIST AND ADDRESSES

Department/Discipline Contact Title Phone Fax

Bar Code & Shipping Labels EDI Commerce Manager 630-810-2767

Invoicing & Payments Accounts Payable Manager 630-810-2375 630-810-2799

Packaging Packaging Engineer 630-810-2433 630-810-3810

Product Management Sourcing Manager 630-810-2631 630-810-2716

Purchasing/Purchase Orders Direction - Inventory Operations 630-810-2468 630-810-3800

Receiving Appointments See Warehouse location below

Receiving - General Questions See Warehouse location below

Safety/MSDS Safety Manager 630-810-2751 630-810-2713

Supply Chain Management Sr. VP Global Sourcing and Procurement 630-810-2630 630-810-3810

Transporation & Routing (Domestic) Domestic Traffic Manager 630-810-2786 630-810-2713

Transportation & Routing (International) Import Coordinator 615-501-4014 615-641-2207 Wilton Corporate Office Woodridge Warehouse 2240 West 75

th Street 2240 West 75

th Street

Woodridge, IL 60517 Woodridge, IL 60517 Phone: (630) 963-7100 Phone: (630) 810-2576 Romeoville Facility I Romeoville Facility II Shorewood 1125 W. Taylor Rd 1010 W. Taylor Rd. 21350 S. SW Frontage Road Romeoville, IL 60446 Romeoville, IL 60446 Shorewood, IL 60404 Phone: (815) 834-9390 Phone: (630) 810-2115 Phone: (815) 823-8510 Canada Wilton Industries Canada LTD 98 Carrier Drive Etobicoke, Ontario Canada M9W5R1 Phone: (416) 679-0790 Fax: (416) 679-0798


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13 WILTON FORMS FOR VENDOR USE

13.1 VENDOR FACT SHEET / ADDRESS FORM

Vendor Employee Sales Rep/Broker

Add Change Delete

Mailing Name Search Type: B (Broker)

Alpha Name E (Employee)

Address 1 S (Subcontractor)

Address 2 SR (Sales Representative)

Address 3 V (Supplier)

Address 4 VB ('Bill To' Supplier)

City VL (Vendor Location)

State VR ('Remit To' Supplier)

Zip

Country Business Unit

Business Phone

Fax

E-Mail Address

Contact Name

Tax ID

Print Message

Evaluated Receipt:

Send Method(Numerical Code)

Preferred Carrier(Name) (AB Number)

Sales Rep/Agent #(Name) (Vendor Number)

Category Code: 07 - Vendor Group If Code 07: 1

08 - Sales Division

09 - 1099 Code

If Code 08: 1

Terms: 1

Payment Type If Code 09: 1

Discount % Discount Days

Comments

ADDRESS BOOK FORM

Remit To Address (if different from above):


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14 VENDOR GUIDE APPENDICES

14.1 APPENDIX A - UPC-A BAR CODE GUIDELINES

The Universal Product Code (UPC-A) is an item-level bar code that identifies the manufacturer, the type of product, and the size or unit. Since the UPC cannot be printed on most corrugated and Kraft surfaces, the code must be applied with an adhesive label. The UPC symbol allows representation of the numbers 0 – 9. With the UPC-A, each of the 12 human readable numbers found below the code is represented by a unique pattern of two bars and spaces. These bars and spaces can be one, two, three, or four modules wide. A) All Wilton sellable merchandise units require the UPC code on the outside of the sellable carton. B) All bar codes must be printed on either laser or thermal printers.

The format of the UPC-A symbol is as follows:

1 Guide Bars – signals the start and finish of the symbol. 2 Number System Character – assigned by the Universal Code Council (UCC). Numbers reserved

for retail are 0, 6, and 7. 3 UCC Manufacturer Number – unique identifier assigned to manufacturers by UCC. 4 Product Number – assigned by the Vendor and is unique by customer. 5 Check Digit – calculated from the other 11 digits and is used by scanners to perform a validity

check on the bar code. See Appendix C for the Modulo-10 check digit calculation.


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Nominal (100%) Bar Code Size

1 “X” Dimension / Symbol Size

The nominal size (100%) of the “X” dimension is equal to 13 mils (13 thousands of an inch). With this size, the symbol is 1.020 inches (25.908 mm) in height and 1.469 inches (37. 313 mm) in width (including the quiet zones). Reduction can range from 80% (“X” = 10.4 mils) to 200% (“X” = 26 mils). The UPC symbol is the only symbology that refers to its various sizes as “magnifications”. See Appendix D for details on specific sizes.

2 Quiet Zone

The minimum quiet zone required for a UPC symbol is 9 times the “X” dimensional both the beginning and the end of the symbol.

3 Bar Height

The bar height must always be uniform according to Appendix D. Truncations of the bar height will cause errors in scanning.

4 Tolerance

The tolerance is dependent on the “X” magnification. See Appendix D.

5 Optical Characteristics UPC symbols are required to have a certain Print Contrast Signal (PCS). The minimum PCS is based on the reflectivity of the background color. See Appendix E.


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14.2 APPENDIX B - SCC-14 (INTERLEAVED 2-OF-5) BAR CODE GUIDELINES

1 Start Pattern – the start pattern is two narrow bars and two narrow spaces and is used for every I 2-of-5 code. This is a “non-data” character.

2 Packaging Indicator – a one-digit prefix that provides a unique identity of a packaging level per

Wilton’s specification such as Eaches, Inner-packs, Master packs, and Pallets. This digit will range from “0” through “7”.

3 Number System Character – a one-digit number assigned by the UCC at the time a

manufacturer’s number is obtained; this must be preceded by a zero to indicate a product that is manufactured in the U.S. or Canada.

4 UCC Manufacturer Number – this five-digit number is assigned by the UCC to uniquely identify

each manufacturer. 5 Product / Item Number – this five-digit number is assigned by the manufacturer to identify each

product. 6 Modulo 10 Check Digit- this number is mandatory for every UPC Shipping Container Code. The

formula for this calculation, which uses all preceding 13 digits, can be found in Appendix C. 7 Stop Pattern – as with the start pattern, this is a “non-data” character. This is a signal to the

scanner that this is the end of the symbol.


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Nominal (100%) Bar Code Size

1 “X” Dimension – magnification is used to describe the size of the symbol. At a magnification of 1.0, the “X” dimension is .040 inches (1.02 mm). The symbol can be uniformly reduced to a magnification of .625, which has a “X” dimension of .025 inches (.635 mm) or increased to a magnification of 1.2, which has a “X” dimension of .048 inches (1.219 mm).

2 Quiet Zone – The minimum quiet zone is 10 times the “X” dimension, or .10 inches (2.6 mm),

whichever is greater. Therefore, if the “X” dimension is .025 inches (.6 mm), the quiet zone should be .25 inches (6.4 mm).

3 Bar Height – the minimum bar height uniformly increases as the “X” dimension increases. At a

magnification of .625, the minimum bar height is .78 inches (19.8 mm). At a magnification of 1.20, the minimum bar height is 1.50 inches (38.1 mm).

4 Wide-to-narrow Ratio - a wide-to- narrow element ratio of 2.5 to 1 is suggested. 5 Tolerances – the maximum for any bar or space of the UPC Shipping Container Code is +/- .012

inches (.3 mm) times the symbol magnification. However, no bar or space may be printed smaller than .020 inches.

6 Print Contrast – The UPC Shipping Container Code must have a minimum Print Contrast Signal

(PCS) value of 75%. See Appendix E.


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14.3 APPENDIX C – MODULO-10 CHECK DIGIT CALCULATION

The check digit number used in this example is “1234567890”. First, number each character position from left to right (start with the number system character of 0 as position #1). Step 1: Starting at position 1, add up all the values of the numbers on the odd positions.

0+2+4+6+8+0 = 20 Step 2: Multiply the result of Step 1 by 3.

20 x 3 = 60

Step 3: Starting at Position 2, add up all the values of the numbers in the even numbered positions.

1+3+5+7+9 = 25

Step 4: Add up the results of Step 2 and Step 3.

60 + 25 = 85

Step 5: The check digit is the smallest number, which, when added to the value obtained in Step

4, provides a number that is a multiple of 10.

85 + 5 = 90

(Therefore, the Check Digit for “10234567890” is “5”.)


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14.4 APPENDIX D – UPC SYMBOL SPECIFICATION SYMBOL DIMENSIONS AND TOLERANCES

Magnificatio

n

Height

Width

“X”

Dimension

Tolerance

80 0.816” 20.73 mm 1.175” 29.85 mm 10.4 mils 1.4 mils 85 0.867” 22.02 mm 1.249” 31.72 mm 11.0 mils 2.0 mils 90 0.918” 23.32 mm 1.322” 33.58 mm 11.7 mils 2.7 mils 95 0.969” 24.61 mm 1.395” 35.43 mm 12.3 mils 4.3 mils 100 1.020” 25.90 mm 1.469” 37.31 mm 13.0 mils 4.0 mils 105 1.071” 27.20 mm 1.542” 39.17 mm 13.6 mils 4.3 mils 110 1.122” 28.50 mm 1.616” 41.05 mm 14.3 mils 4.6 mils 115 1.173” 29.80 mm 1.689” 42.90 mm 15.0 mils 4.9 mils 120 1.224” 31.09 mm 1.763” 44.78 mm 15.6 mils 5.2 mils 125 1.275” 32.39 mm 1.836” 46.63 mm 16.2 mils 5.5 mils 130 1.326” 33.68 mm 1.910” 48.51 mm 16.7 mils 5.8 mils 135 1.377” 35.98 mm 1.983” 50.37 mm 17.5 mils 6.1 mils 140 1.428” 36.27 mm 2.057” 52.25 mm 18.2 mils 6.4 mils 145 1.479” 37.57 mm 2.130” 54.10 mm 18.8 mils 6.7 mils 150 1.530” 38.86 mm 2.204” 55.98 mm 19.5 mils 7.0 mils 155 1.581” 40.16 mm 2.277” 57.84 mm 20.2 mils 7.3 mils 160 1.632” 41.45 mm 2.350” 59.69 mm 20.7 mils 7.6 mils 170 1.734” 44.04 mm 2.497” 63.42 mm 22.1 mils 8.2 mils 180 1.836” 46.63 mm 2.644” 67.16 mm 23.4 mils 8.8 mils 190 1.938” 49.23 mm 2.791” 70.89 mm 24.7 mils 9.4 mils 200 2.040” 51.82 mm 2.938” 74.63 mm 26.0 mils 10.1 mils


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14.5 APPENDIX E – UPC SYMBOL OPTICAL CHARACTERISTICS

Light Background Dark Background

Percent Reflectance

Density

Maximum Percent

Reflectance

Minimum Density

Minimum Print

Contrast Signal (PCS)

31.6 % .500 2.5 % 1.600 .921

35.0 % .456 3.3 % 1.485 .906

40.0 % .398 4.6 % 1.335 .884

45.0 % .347 6.3 % 1.202 .860

50.0 % .301 8.3 % 1.083 .834

55.0 % .260 10.6 % .975 .807

60.0 % .222 13.3 % .877 .779

65.0 % .187 16.4 % .786 .748

70.0 % .155 19.8 % .703 .717

75.0 % .125 23.7 % .625 .684

80.0 % .097 28.1 % .552 .649

85.0 % .071 32.9 % .484 .614

90.0 % .046 38.1 % .419 .577

95.0 % .022 43.9 % .358 .538

100.0 % .000 50.1 % .300 .499


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14.6 APPENDIX F – MODULO 103 CHECK DIGIT CALCULATION

In order to calculate the check digit for Code 128, a value (from 0 to 105) is assigned to each of the 128 digits of the character set. For the UCC-128 specification, the FNC1=102, and each digit pair equals its value (complete value chart for Code 128 is found in the USS-128 Uniform Symbology Specification). To calculate the check digit, perform the following steps: The Code 128 symbol used in this example is “Start Code C, Function Code 1, 0000012345999999992”. Step 1: Find the Value of the Start Character (Start A=103, Start B=104, Start C=105)

Start C = 105

Step 2: Find the values of all remaining characters in the code (each “Digit Pair” in Subset C equals its value and FNC1=102).

FNC1=102, 00=0, 00=0, 01=1, 23=23, 45=45, 99=99, 99=99, 99=99, 99=99, 92=92

Step 3: Weight the first character value after the start character by 1 and continue with 2, 3, 4,

until you reach the end of the data.

105, 102x1, 0x2, 0x3, 1x4, 23x5, 45x6, 99x7, 99x8, 99x9, 99x10, 92x11

Step 4: Multiply the figures and add them up) with the value of the start character).

105 + 102 + 0 + 0 + 4 + 115 + 270 + 693 + 792 + 891 + 990 + 1012 = 4974

Step 5: Divide the sum from Step 4 by 103. The remainder equals the value if the Modulo-103

check digit.

4974 divided by 103=48, with a remainder of 30

(Therefore, 30 is the correct check digit)


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14.7 APPENDIX G – VENDOR COMPLIANCE CERTIFICATE

COMPLIANCE CERTIFICATE

The undersigned hereby certifies that it has received and reviewed the Domestic Vendor Business Guide including but not limited to the Vendor Legal Compliance Policy and the Product Safety and Quality Compliance Policy. The Vendor hereby represents, warrants and covenants that it will strictly adhere to the Domestic Vendor Business Guide available at http://www.wilton.com/vendors/

The Vendor hereby acknowledges and agrees that the Domestic Vendor Business Guide is subject to change from time to time. The Vendor’s continued performance shall be deemed its continuing consent to the Domestic Vendor Business Guide, as amended from time to time at Wilton’s sole discretion.

The undersigned represents and warrants it is authorized to execute this Compliance Certificate on behalf of the below named Vendor.

VENDOR NAME:

_________________________________

BY:______________________________

NAME: ___________________________

TITLE:____________________________

DATE:____________________________

http://www.wilton.com/vendors/

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