Austins Marmon Limited 29th Floor, Nanyang Plaza, 57 Hung To Road, Kwun Tong, Kowloon, Hong Kong Tel : (852) 2858-0388 Fax : (852) 2858-5450, 2858-5493, 2858-5472 e-mail : austins@glove-world.com Homepage : http://www.glove-world.com Edmund Jung, BA Department of International Sales & Marketing Manager ISO9002 Ver. 8.23.01 Dear Madame/Sir, Hello! I would like to welcome you to the possible beginning of a prosperous relationship with Austins Marmon Limited. We are strictly an OEM & ODM glove manufacturer so any business dealt with us is factory direct. With over 30 production facilities located throughout Asia, you can be assured that working with us on your glove program will prove to be highly rewarding. Not only will you be able to reap all the benefits of working directly with a manufacturer but in addition, you will receive the best service this industry has to offer. Austins has been in the glove manufacturing business for close to four decades and over the years, we have developed many key methods to increase our efficiency and level of services to our customers. There are few, if any, manufacturers who offer such a complete glove program such as ours. It has and will always be our goal to provide our best manufacturing services to our customers. Some of the important support and services we can provide include: research & development, design & analysis, and marketing support consultancy. Our aim is to develop more of a partnership with our customers, rather than just a vendor-purchaser relationship. With Austins, you can be assured of receiving top-quality service and OEM products. The following outline is an overview of the direction we are heading in. We would greatly appreciate it if you would take a little time to review the Austins Marmon Glove Program booklet and contact us for further inquiries, thank you. Yours faithfully, Edmund Jung Austins Marmon Ltd. 2 AUSTINS MARMON’S GLOVE PROGRAM CONTENTS 1.) Introduction 2.) How to get started? 3.) Choosing Styles & Designs 4.) Choosing Fabrics and Materials 5.) Sampling and Prototypes 6.) Shipping Arrangements 7.) Program Summary 8.) Ethics and Mission Statement 9.) End Notes and Customer Policy 10.) Reference List 11.) Persons to Contact 12.) Corporate Relationships 13.) Branch Offices & Regional Contacts 3 1. Introduction Austins Marmon has been in the glove manufacturing industry for over three decades. Our exquisite workmanship and quality, coupled with worldwide material resources makes us considered to be one of the very best in the glove industry. In fact, with over thirty production facilities including our own tanneries and textile processing operations throughout China, Indonesia, Sri Lanka, Cambodia, and Bangladesh, we have been supplying top quality gloves throughout the world. Our headquarters is conveniently located in Hong Kong, the hub of Asia and the ultimate gateway to China. The wide range of gloves we manufacture span from all kinds of industrial-work gloves, technical and safety gloves, to all types of dress-fashion, casual, and sports gloves. It has come to my attention that there are still many reputable companies currently unaware of the profitability of working directly with a producer. Not only will working with us minimize your costs and increase revenues, there will undoubtedly be better control and a substantially clearer flow of information from us to you, as a customer. In addition, problems can be addressed directly and more efficiently in this manner. Austins Marmon carries out its business in a most professional manner. Hence, the quality of service and production should not be questions to worry about when working with us. From a strictly business point of view, a closer and more economically synchronized relationship between a buyer and vendor is mutually beneficial. Another success factor lies in the appropriate utilization of the Asian manufacturing sector. Asia has proven to be a new force within the manufacturing industry on a global scale, and its ability to provide high quality, lowered cost production makes it a highly attractive source for all companies. With such a well-rounded assortment of production facilities located at different strategic points throughout Asia, you can have confidence in the flexibility of our manufacturing services. There will always be a stable level of manufacturing capacity to meet any unforeseeable changes that may occur on the political arena. Working with Austins Marmon enables customers to enjoy both the benefits of greater competitiveness, while working with a strong and modernized management. Simply put, we can provide all the same services you would receive from a trading firm, agent, or buying office and much, much more; without any added costs. 4 Austins constantly strives at improving its level of service and to extending an unyielding level of quality products to its customers. We are currently the only Asian glove manufacturer with China factories that have been certified by W.L. Gore & Associates to produce Gore-tex seam sealed hand wear. We are also proud to be recognized as owning one of the first dress-sports glove factories in Asia to be certified as being an ISO9002 facility. Our next step to have our Sri Lanka plant also elevated to ISO9002 status by mid 2003. Our latest addition is a brand new sports and dress gloves factory situated in Panyu, China, which had its Grand opening on July 20, 1998. This new factory will be the ultimate performance testing grounds for some of our newer and more innovative forms of modern management, automation, quality control, and efficiency. We have also started a knitting operation in Sri Lanka as well, for the production of all types of knitted gloves. Together with the vast amounts of quota that we hold in Sri Lanka, we are confident that this new operation will prove to be extremely competitive in the glove industry. This new operation will open up many doors for us, including areas such as dipped gloves in: latex, PVC Nitrile, etc. which are due to be materialize by the year 2003. Our patented GloveMate disposable liner product is gaining wider and wider acceptance in the countries, which it is being sold on an exclusive basis. And our R&D department is constantly seeking to create newer and more innovative items for the glove industry. Our annual global exports amount to 4.5+ million dozen pairs of gloves so production capacity is definitely not something to worry about when working with us. As you can see, we are very serious about what we do and more importantly, what we can do on behalf of our customers. Our glove program is designed to offer you a complete packaged deal incorporating everything from designing, counter sampling, costing, final production, QC inspection, to drop shipping. Our support teams are made up of different divisions, each specializing in a particular glove field. They are experts in what they do, and most importantly, they care about you, the customer. We value your support and business and look forward to servicing your glove needs. If you would like further inquiries and additional information or, if you would like to see our workmanship and/or to assess our quotations, please do not hesitate to contact us. We look forward to hearing from you soon, thank you. 5 2. How to Get Started? The initial step in preparing for a successful glove program is to decide which market sector you would like to target for introducing your glove line into. 1.) Which kind of consumer product categories are available for my product? 2.) What type of consumer do I want to attract to buy my gloves? 3.) What type of market or market niche will offer the greatest potential? 4.) What sorts of marketing tools are available at my disposal? 5.) What type of sales network do I currently have? The next step would be to decide on how many types of gloves you want to initially introduce into the market you have chosen. 1.) 2.) 3.) 4.) Do I want to cover a wide range of glove styles or just to focus on a few? What kinds of costs would be involved in an extensive vs. a simple range? What image do I want to portray in this new market? How many designs would be suitable as an introduction into this new market? Basically, you have to consider what business and marketing strategies you want to follow and to synchronize them with your company image, mission statement, and corporate strategy for launching your new glove(s). 3. Choosing Styles & Designs In order to choose what style of glove you would want to use for your intended glove line, there are two simple approaches you can choose to take: 1.) Find existing gloves and/or mitts and to work off of them by modifying them until they become uniquely different, or until they become the way you want them to be. This is fastest and most efficient method to create an initial glove line. 2.) Start from scratch working only with initial ideas to develop totally new designs currently unavailable on the market, based on trends and consumer (end-user) input. This method is undoubtedly more time consuming and requires more resources. However, if you should choose this route, Austins will be more than willing to offer our support in this endeavor. 6 4. Choosing Fabrics & Materials The most important part of any glove or mitten lies in the kinds of materials that comprise the product. First, we must realize that the basic material components of a glove are dependent upon the ultimate use of the glove. A critical success factor lies in the appropriate choice of materials to be used in the construction of a glove. This is because the proper materials must be matched to the end-use of the glove in order for the glove to work properly. Some factors that must be considered include: texture, hand feel, abrasion resistance, washability, breathability, tear resistance, durability, comfort, ease of sewing, and of course style. Austins Marmon is familiar with many material suppliers in Asia, as well as in Europe and the United States. Some of the material suppliers we work with include: DuPont, 3M, W.L. Gore & Associates, Toray, Primaloft, Malden Mills, Burlington, Allied Signal, Porvair, Kurraray, Ohgi, Starensier, Travis Textiles, Pittards, Harrison Technologies, Warwick Mills, Velcro, Hitex, Due Emme, Polymark, Majocchi, Kolon, Somitex, Duraflex, Tomen, etc. We process most of our leathers at our own tanneries, as well as carry out water and stain resistant treatments to the leather such as Scotchguard or Teflon treatments. We are also able to produce waxed leather as well as custom dyeing (which involves minimum quantities). We are also adept at carrying out special applications such as the installation of waterproof or waterproof-breathable inserts, and hot air seam taping of technical mittens. Since the cost of a glove is directly related to the kinds of materials used to make it, it becomes very important in choosing between the price and the performance of materials. This is where locally sourced domestic/generic materials become essential in keeping costs down. In fact, with today’s growth in material producers throughout Asia, there is an abundance of good quality materials at reasonable prices. Of course, we must also consider the brand image of materials as well. But the more name branded materials we choose to use, the higher the overall cost of the glove. Again, the kind or brand of fabric and materials you choose will ultimately depend on the marketing strategy you choose to follow. You may elect to supply your own specified fabrics to us, in order to have the gloves coordinate with an outerwear or accessories line you may have. The options are endless and we are open to all of them. One important factor to remember however, when choosing materials, is that every material supplier imposes a minimum order requirement. This minimum 7 order condition is usually based on a specific number of yards or meters per color/dye lot. The average minimum order requirement for fabrics is about 5001000 yards per color. In order to choose the most appropriate materials for your glove line, you must answer the following questions in light of your business strategy: 1.) 2.) 3.) 4.) 5.) What sort of fabric price point am I looking at? What are the characteristics of this fabric? What are the minimum order requirements for this fabric? What are the delivery lead-times for materials? What sort of market acceptance does this fabric have? 5. Sampling & Prototypes The sampling process begins once the initial design for a glove has been set. The development work required before an initial design for a glove is ready, can be done in one of two ways. First, you the customer may have in-house designers to work on your glove. Or second, you may ask us to develop your glove for you based on a general framework or specifications provided to us. The next step involves placing a sample order to me, which will enable me to go ahead and produce a prototype sample (counter sample) for you. These preliminary sample orders are called prototype sample orders. Since we must assume that the prototype samples have never been produced before, they will take slightly more time to finish than second or third samples. Hence, the turnaround time for prototype samples is approximately two weeks. If changes and/or revisions need to be made to the prototype samples, then you must place a second sample order to me, and then if required, a third sample order etc., until the glove comes out right. We are usually able to calculate the FOB sales price of the glove at the prototype sampling stage, but it would be more accurate to make the calculations after the second sampling stage unless, of course, none is required. One trap that many people fall into when it comes to modifying e gloves, and placing second sample orders, is that they become too enraptured by the entire sampling process and forget about the practical aspects of a design. More often than not, one loses sight of whether a particular design can even be sewn! From a manufacturing point of view, if a design cannot be sewn, then there is really no 8 reason for its existence. Another trap many fall into has to do with the sizing of a glove. It is a true fact that no two people have exactly the same size and shape of hand, so if one were to judge the fit of a glove based only on one’s own hands, that judgement would be totally subjective. Throughout the many years of glove manufacturing, we have developed an average grading scale that caters to the majority of hand shapes and sizes. It is strongly suggested that this be adhered to because the modification of individual finger lengths, thumb widths, etc. can go too far and become too messy. Once the design of a particular glove has been set, a customer will often require salesman and/or trade show samples in order to sell the gloves. Salesman / show samples are charged at the 1.5 times FOB sales prices, and not at the flat rate sampling charge. Salesman/show samples will also be treated as Whiteseal samples and are used for confirmation of construction, design, etc. It is extremely helpful to us as a manufacturer if we are given projections as to the quantity of salesman/show samples a customer expects to need for a particular season. Time line schedules outlining when show samples must be delivered as well as the required quantity will also facilitate us in making the transition from prototype sampling stage to white-seal sampling stage. All of our sampling is done by hand up to the Green-seal or, (pre-production) sampling stage and, is definitely a craft that requires years of practice and dedication. Therefore, we must limit the number of samples we can produce during the initial sampling stages to less than 20 pairs per style. Furthermore, it would be close to impossible to produce bulk (salesman) samples in this method because of the time involved. Hence, all sample orders of 20 pairs or more per style will mean that cutting dies will have to be made and these costs charged to the customer. These costs are refundable (able to be deducted) if an order is placed for this particular style within the season. Once the Green seal samples have been approved, we will commence with the production of the cutting dies, based on the Green Seal samples themselves. 6. Shipping Arrangements Shipping arrangements are often a neglected part of business because it is often left to the responsibility of forwarders. However, it is vital that the proper documents are prepared correctly in order for goods to clear customs without hassle. 9 1.) It is very important that you inform Austins Marmon ahead of time, as to where the goods are to be shipped. 2.) Importing from certain countries requires specific documents for customs clearance so it is imperative that you check with your customs office to see which ones are needed. If you are having us drop ship to countries other than the U.S.; perhaps directly to your distributors, then you must find out this information from them as well. 3.) The address, phone and fax number as well as the name of the ship to contact person together with your forwarder’s information is also necessary. If you do not have a specified forwarder, we can help you arrange to have the goods shipped via our own forwarder. 4.) There are actually many costs involved with acquiring shipping documents from the respective government agencies which are as follows: Shipping Documentation Costs 2001-2 Description GSP FORM A (CHINA) C.O. (CHINA) C.O. (HONG KONG) CAT.87 GSP FORM A HK COUNTERSIGNED GSP FORM A HK$ $300.00 $190.00 $140.00 $1,300.00 $140.00 US$ $39.00 $24.50 $18.00 $168.00 $18.00 Some Notes on Drop Shipments: Please note that Austins Marmon will be unable to incur the following costs on behalf of our customers under the following conditions: 1.) If the total invoiced amount for goods being shipped to any specified port of destination (per country) amounts to less than US$5,000.00 per invoice. 2.) If the total quantity of gloves on any one invoice being shipped to any specified port of destination (per country) amounts to less than 3000 pairs. This is due to the expensive nature of certain documents required by your particular customs agency (as listed above) and, some of which, are required for the importation of gloves into specific countries 10 Customs Documentations and Certificates required for the importation of gloves for various countries: COUNTRY GLOVES OF 100% WOVEN FABRICS OR, WITH OVER 50% WOVEN FABRIC, BUT WITH LESS THAN 50% LEATHER IN WEIGHT OR COMPOSITION GLOVES OF 100% LEATHER OR, GLOVES WITH OVER 50% LEATHER BUT LESS THAN 50% FABRIC IN WEIGHT OR COMPOSTION CANADA JAPAN ITALY U.K. SWEDEN AUSTRIA NORWAY FRANCE NETHERLANDS ICELAND U.S.A. FORM A FORM A FORM A or C.O. FORM A or C.O. FORM A or C.O. FORM A or C.O. FORM A FORM A or C.O. FORM A or C.O. C.O. FOR KIDS’ GLOVES (AGES 1-3 YRS) NEEDS CAT.631 & C.O. OTHERWISE NO DOCUMENTS REQUIRED C.O. NOTHING REQ’D FORM A FORM A FORM A & C.O. FORM A FORM A FORM A FORM A FORM A FORM A C.O. NO SPECIAL DOCUMENTS REQUIRED SWITZERLAND AUSTRALIA C.O. NOTHING REQ’D GLOVES OF 100% KNITTED FABRICS OR, GLOVES WITH OVER 50% KNITTED FABRICS BUT WITH LESS THAN 50% LEATHER IN WIEGHT OR COMPOSITION FORM A FORM A CAT.10 & C.O.* CAT.10 & C.O.* CAT.10 & C.O.* CAT.10 & C.O.* FORM A CAT.10 & C.O. CAT.10 & C.O. C.O. NO SPECIAL DOCUMENTS REQUIRED FOR SKI GLOVES OTHERWISE QUOTA CAT.331 OR CAT.631 C.O. NOTHING REQ’D *Remarks: Cat.10, Cat.331 or Cat.631 quota is provided by AML F.O.C. if the gloves are produced at any of our Sri Lanka, Cambodia & Indonesia factories. 11 Remarks concerning GSP Form A’s and Quota Restrictions : Please be aware that every country sets specific quantity limits each year pertaining to the allocation of preferential duty rates on the importation of goods from specific countries. These preferential duty rates are country specific and obtainable only if the goods being imported have a Form A issued from the respective country in which the goods were produced. The preferential duty rate depends upon the agreement set forth between different countries and applies generally to the importation of goods from 3 rd world countries. However, these policies are subject to the scrutiny and possible change by the respective country to which the goods are being imported into. Furthermore, each country sets their own limits on the number of goods that can be imported on this preferential basis. If this limit has been reached for a particular country, then the Form A ceases to entail the bearer to lowered duty rates. Usually, the limit of goods being imported under Form A terms becomes depleted by early autumn when most goods have been, or are being shipped. In order for us not to incur unnecessary documentation costs, we kindly ask that for all shipments from August onwards, that customers check with their respective customs agencies to ascertain whether the preferential duty rate limit for that particular year has been depleted yet. If it is in fact true, that no additional reductions on the duty rate are obtainable from the presentation of a Form A, we will ask that our customers do not request for the issuance of this document. (Unless it is absolutely necessary to have a Form A for customs clearance under other circumstances as per the guidelines shown on the previous chart). All quota restricted items are subject to the availability of the necessary quota at time of production, and all costs involved with the acquisition of the required quota, will be for the account of the customer. However, under certain situations, the cost of the quota may be spread out and included in the FOB sales price, instead of being charged to the customer under separate invoice. Please note that the most often sought after quotas for gloves are category 631 and category 10. For all orders produced at our Sri Lanka factories, the cost of the quota for Cat. 331, 631, and 10 will be fully absorbed by Austins because we hold such quotas ourselves. 12 7. Program Summary In order to best utilize our time and efforts in a constructive manner in creating a strong glove program, the following factors should always be kept in mind : 1.) Choosing the most appropriate styles based on the available time you have allocated for the program. 2.) Choosing the most appropriate materials based on cost, performance, and availability while taking into consideration of minimums. 3.) Preparing projections and planning for order placement as early as possible. 4.) Initiating the sampling process as early as possible. 5.) Keeping in schedule with the planned progression of each stage of glove development. 6.) Placing the salesman/show sample orders in a timely fashion. 7.) Placing the in-line order as early as possible to secure a good delivery date 8. Austins Marmon Limited – Ethics and Mission Statement It has, and always will be the goal of Austins Marmon Limited to provide the utmost quality of service and glove products to our customers. We operate under a strict adherence to business practices that lead to mutual trust and loyalty between Austins and our customers. Hence, we solemnly promise that no designs we manufacture for a particular customer may be exactly reproduced for another customer; even if that design is given to us by our customer or, if it was created by Austins’ design staff on behalf of a customer. 13 Any styles that we manufacture for a customer of ours, becomes proprietary and will not find its way into others’ hands through us. Although we deal with many customers whose styles may invariably fall within the same classification or Market segment, we ensure that each customer’s information, styles, and quotations are kept in confidence. This is the ethical policy we keep and maintain at all times. Our corporate mission is to offer our glove manufacturing services in support of all companies within the private label (manufacturers industry), licensed products, wholesale, retail, corporate and government tenders. However, we are also able to provide material sourcing services to our customers for other soft and hard goods items including manufacturers of other products, producers of raw materials, printed materials, and various other sources of material suppliers. As everyone is well aware of, the consumer market is dynamic and it requires time and devotion in order to understand such a market. Therefore, Austins conducts regular market research into areas such as consumer trends, consumer spending, and maintains updated industry news pertaining to all aspects of the glove related markets. Austins also aims to be the forerunner of the glove industry and constantly seeks the newest developments in materials and fabrics. This is because it is also part of our mission to be able to provide the best and most updated information to our customers regarding all the latest technical advancements in materials and fabrics on a worldwide basis. We have often been asked why we do not move into manufacturing other products in addition to gloves, such as: apparel, bags and hats etc. and the same reason is given time and time again. It is simply because “We want to be focused on what we do in order to do it right” Just remember… ‘Gloves’ is what Austins is all about! Susan Cheng Director Austins Marmon Ltd. 14 9. End Notes & Customer Policy Sample Development Charges All new design and initial style development samples will be charged at a flat US$30.00 FOB Hong Kong per pair rate. All revised samples (second, third, and consecutive samples) are charged at a flat US$25.00 per pair FOB Hong Kong rate. All courier and shipping costs of samples are for the account of the customer. We expect the customer to inform us of which carrier/method of shipment to use, otherwise by default, we will use a courier of our own choice. Sales samples (bulk samples) are charged at 1.5 times the quoted FOB sales price for each particular/separate glove style. Minimum Orders & Surcharges (NEGOTIABLE; WE ARE VERY FLEXIBLE) The minimum order quantity per each style, and in each size is 900 pairs. Orders for each style that fall between 900-700 pairs per size will be charged an additional 10% of the FOB sales price. All orders that fall between 699-500 pairs per style and per size will be charged an additional 20% of the FOB sales price. All quantities that fall between 499-200 pairs per style and per size will be charged a 30% surcharge. All quantities below 199 pairs per style and per size will entail a 40% surcharge. However, please note that under certain circumstances, the minimum order requirements may be negotiable or, other arrangements can be made with us to resolve minimum order quantity (MOQ) issues. Minimum order requirements are imposed for the following reasons: 1.) economies of scale 2.) to try and meet the minimum order requirements of fabric suppliers 3.) to amortize the high cost of the cutting dies Since the supplier’s minimums are beyond our control, we have no direct influence over this issue. As far as cutting dies are concerned, it costs AML about US$350 per set of cutting dies. One set of cutting dies can make one style of glove in one size. Hence, in order for our endeavors to be economically viable, we must receive sizable enough orders to enable us to amortize the cost of these cutting dies. However, there are also other solutions to this dilemma: 1.) the customer may elect to pay for the cost of the cutting dies up front 2.) cost of cutting dies may be spread out into the FOB sales price of the gloves 3.) cost of cutting dies are refundable once the total order quantities reach our minimum quantity requirements within a 12 month period 15 Economies of scale: In order for us to best utilize the economies of scale in production, we must impose the following minimum/maximum quantity per orders: Minimum order quantity per single bulk order is 4500 pairs. Maximum order quantity per single sample order is 500 pairs. Cost of Cutting Dies: The cost of the cutting dies may be waived if the quantity being placed meets or exceeds 900 pairs per style and per size. If the order does not meet this minimum requirement, then the customer can choose to bear the entire cost of the cutting dies or, elect to pay the surcharges. Material Supplier’s Minimums: The minimum order requirements for fabrics will depend on each individual supplier, and for each particular fabric. If AML must order a minimum quantity of fabric on behalf of a customer, then the cost of the excess fabric must be borne by the customer. All excess fabrics will be dealt with in the following manner: Supplier minimum on fabric Order requirements Customer bears excess inventory 1000 yards per color 650 yards per color 350 yards per color Austins will store the excess fabric in its warehouse on behalf of the customer free of charge for the duration of 1 year from date of receipt. The customer has every right to utilize the excess fabric by placing additional glove orders in order to exhaust the inventory within that year. If excess fabric still remains in Austins’ warehouse after one year it will be disposed of accordingly. Lead-Times: The average lead-time for an order between 9000 – 30,000 pairs is 120 days in general, provided that all materials necessary for the production of that order is available and ready for shipment to us at time of order placement. A lead-time of between 60-90 days will commence once all materials have arrived at our factory (actual production time). However, during the peak season of May, June, July, and August, the lead times may stretch up to 180 days. Also, all orders will be scheduled on a “first come first served” basis, depending on the date an order is received and on when the L/C for that order is opened. 16 Remarks: Please note that all minimum order requirements refer to the shipment of such goods to only one port of discharge. All orders are subject to the approval of AML and any acceptance or rejection of an order resides solely within the discretionary powers of Austins Marmon Limited. Terms of Payment Payment for samples and all other amounts of not more than US$ 5,000 and not less than US$1000.00 should be wired (by telegraphic transfer, T/T) to the following account: Banker’s Name Banker’s Address Account Number Company Name Company Address : : : : : The HongKong & Shanghai Banking Corp. Ltd. 1 Queen’s Road, Central, Hong Kong 567-004-221-001 Austins Marmon Limited 29th Floor, Nanyang Plaza, 57 Hung To Road, Kwun Tong, Kowloon, Hong Kong Payments for the above may also be made by: Bank Draft, Cashier’s Check, Company Check or International Money Order in U.S. funds only. No personal checks please. Please note that payments amounting to less than US$1000.00 can also be paid by the following credit cards: Visa and Mastercard. All payments for bulk orders amounting to less than US$15,000.00 may not be payable by Bank Draft, Cashier’s Check, or Money Order, and must be settled by telegraphic transfer. The basic terms of payment upon placement of any in-line glove order is Irrevocable L/C @ sight opened at any recognized bank or adequate facility acceptable to Austins Marmon Ltd. If you require a template for opening the L/C, we can offer one to you that includes all the necessary terms required by our accounting department. 17 Austins Marmon Customer Agreement The following terms and conditions have been laid out for the benefit of both parties involved, and is a formal agreement between Austins Marmon Limited (vendor) and our customers (buyer), and therefore, is regarded to be fully acknowledged and legally accepted by both parties. Terms & Conditions 1.) A standard allowance of +/- 5% difference from the total order quantity will be allowed for all orders shipped, to account for any unforeseen cutting loss, fabric/material damages, or over shipment of fabrics from customer specified material suppliers. The short/over shipped quantity will depend entirely on the discrepancy between the quantity of materials and/or fabrics we purchase according to a customer’s order(s) and the actual quantities of such materials/fabrics that we receive. 2.) All early-bird orders that have been confirmed by an official sales contract for glove deliveries 180 days after order placement, will be given a maximum discount of up to 15% off of the quoted FOB prices. Low season order placements will also entail discount privileges off of the quoted FOB prices. The effective period for low season orders is for any orders requiring delivery between October 05 and February 30 of each year. Low season discounts are subject to the actual quantities of the orders placed. 3.) All salesman / trade show samples will be charged 1.5 times the quoted FOB sales price. This charge is imposed to cover any losses that may be incurred as a result of Austins receiving no actual in-line/bulk orders from customers after extensive sampling has been carried out. 4.) All claims, returns, and refunds must be requested via formal written notification to AML no later than 3 weeks after receipt of the goods; based on the arrival date of the goods to the designated port of entry as per the shipping advice issued by Austins’ shipping department. We will do our best to provide the necessary services to eradicate any problems that have occurred. However, all substandard and damaged goods must be returned to AML at the customer’s cost, for evaluation and assessment before any claims will be subject to settlement. 18 All damages to products resulting from improper use, misuse, and abuse will not be covered by this warranty return policy. Goods must be returned in ‘like new’ condition before this return policy becomes effective. Furthermore, this policy does not extend to any warranties, guarantees, or promises instigated by the customers themselves, to their distributors, retailers, department stores, wholesalers, etc. We will either perform one of the following if goods are found to fail as a direct result of our manufacturing error. All problems resulting from materials and fabrics are not covered by this policy. a.) Exchange non-damaged goods with the returned goods within the limits of the aforementioned ‘standard allowance’ explanation. b.) Perform repairs to the damaged goods. c.) Offer monetary compensation to the customer to take effect either immediately or at a later date. 5.) Due to the uncontrollable and unforeseeable problems that may occur with regards to fabric/materials availability/delivery, Austins shall be given an additional grace period on the delivery date of finished goods of not less than 15 working days against the confirmed delivery date upon written notification to the customer explaining such extraordinary circumstances. 6.) All outstanding invoices exceeding a period of 30 days from date of shipment will be levied at an interest rate of 3% per annum, retro-rated according to the date of the supposed settlement of the outstanding balance owed to Austins Marmon Limited (AML). 7.) All cases involving late deliveries, which may require air-freight shipments to be made, shall be treated on a case by case basis. The length of the delay to the shipment may or may not be the result of a direct error committed by Austins Marmon. a.) Austins is not subject to any costs involving air freight shipments due to a delay in the expedition of goods resulting from natural disasters, acts of God, political upheaval, accidents, catastrophes, etc. b.) The responsibility for all other requests requiring airfreight delivery will be for the account of the customer (buyer). 8.) Austins Marmon Ltd. can and will exercise its right to disclaim any allegations made against it within the legal ramifications of Hong Kong law. 9.) All requests, transfer of information, and correspondence must be made in writing and, in the form of English to be effective and binding. 10.) Austins reserves the right to change/modify any of the terms and policies of this agreement, as it sees fit without prior notice or consent of outside parties. 19 10. Reference List W.L. Gore & Associates 105 Vieve’s Way, P.O. Box 729, Elkton, MD 21922-0729 U.S.A. Contact person : Mr. Brian Murphy Tel : (410) 506-5175 Fax: (410) 392-3849 Toray Industries (H.K.) Ltd., 3rd Floor, TAL Building, 49 Austin Road, Kowloon, Hong Kong Contact person : Ms. Karen Cheung Tel : (852) 2738-6723 Fax: (852) 2730-3485 Schoeller / Rotofil (Far East) Ltd., Suite 806, Tower 1, The Gateway, 25 Canton Road, Tsimshatsui, Kowloon, Hong Kong Contact person : Mr. Johnny Chak Tel : (852) 295601181 Fax: (852) 2956-3909 Pittards plc Sherbourne Road, Yeovil, Somerset, England BA21 5BA United Kingdom Contact person : Mr. Geoffrey Higson Tel : (441) 935-74321 Fax: (441) 935-27145 3M 803 Rainbow Court Stillwater, MN 55082 U.S.A. Contact person: Mr. Kenneth F. Freimark Tel: (651) 439-7872 Fax: (651) 439 3775 20 11.) Persons to Contact The following is a simple directory to the key personnel involved with each particular glove field/division at our Hong Kong headquarters. If you should have any questions, please do not hesitate to contact any of the persons listed below : All General Inquiries: Mr. Edmund Jung Action / extreme sports gloves division : Ms. May Lee: may.lee@austinsmarmon.com.hk Ms. Phoebe Wong: phoebe.wong@austinsmarmon.com.hk Mr. Paul Chow: paul.chow@austinsmarmon.com.hk Dress / sports / casual gloves division : Mrs. Susan Cheng: susan.cheng@austinsmarmon.com.hk Ms. Juliana Lam: juliana.lam@austinsmarmon.com.hk Ms. Angel Chan: angel.chan@austinsmarmon.com.hk Industrial / work / gardening / safety gloves division : Ms. Ingrid Leung: ingrid.leung@austinsmarmon.com.hk Mr. Frankie Lee: frankie.lee@austinsmarmon.com.hk Ms. Esther Fung: esther.fung@austinsmarmon.com.hk Specialty gloves: Mr. Edmund Jung 21 12.) Corporate Relationships The Marmon Group The Marmon Group of Companies is an international association of autonomous manufacturing and service companies. The Marmon Group comprises more than 100 members companies that operate approximately 550 facilities in more than 40 countries and employ about 35,000 people. Forbes places The Marmon Group at 20th on its list of largest privately held companies in the United States. Website: www.marmon.com Wells Lamont Corporation, Wells Lamont Europe, Wells Lamont Industry Group, and Wells Lamont Retail are all member companies of The Marmon Group. Wells Lamont Corporation and Austins Marmon Ltd. Wells Lamont, the world’s largest manufacturer of work and garden gloves, has a joint office in Hong Kong with Austins Marmon Ltd. For more than almost 20 years, the company has manufactured gloves in various countries in Asia including Sri Lanka, Indonesia, Bangladesh, and China through co-ownership of Austins Marmon Ltd. Based in Hong Kong, Austins Marmon operates more than a dozen factories and tanneries in China – in the cities of Dongchong, Sheikei, Gui Xian, Jiangmen, Liangjiang, Pinghu, Wuzhou, Zhongshan, Qing Yuan, Panyu, and Lin Ping – in addition to the Minuwangoda and Katunayake plants in Sri Lanka, the Jakarta manufacturing facility in Indonesia, and the Dhaka plant in Bangladesh. Austins Marmon makes a wide variety of gloves for Wells Lamont and markets its own products in Asia, as well as producing OEM & ODM glove orders. Austins is also proficient in the manufacture of all sports, hunting, fashion, and specialty gloves. Web Sites: www.glove-world.com and www.austinsmarmon.com.hk. In addition to work and garden gloves, Wells Lamont makes hand protection for industrial use. The company is based in Niles, Illinois. Web site: www.wellslamont.com 22 13.) Branch Offices and U.S. Regional Contacts: Austins Marmon North America U.S.A. Head Office: 6640 West Touhy Avenue, Niles, IL 60714-4587 U.S.A. Tel: 847 647 3306 Fax: 847 647 7759 Email: ejung@wellslamont.com West Coast Region: 1278 Glenneyre 81 PMB Laguna Beach, CA 92651 U.S.A. Tel: 949 494 0096 Fax: 949 494 2746 Email: ehoffman9@cox.com Rocky Mountain Region: 1125 Edinboro Drive, Boulder, CO 80305 U.S.A. Tel: Fax: Email: kgray@bouldernews.infi.net Email: randwhitney@hotmail.com 23