JT Tobacco International Taiwan Corp. Notification of Standard Terms and Conditions of Business 1. Applicability The terms and conditions of business set out herein (the Terms ) shall apply to all agreements and transactions for the provision of services or products by services or products providers (hereinafter referred to as a Service/Product Provider or Service/Product Providers ) to JT Tobacco International Taiwan Corp. ( JTI ), with the following exceptions and qualifications:- The Term Should there be any discrepancy between these Terms and the provisions of a purchase order provided by JTI, the provisions of the purchase order shall prevail; and/or Should there be a discrepancy between these Terms and the terms and conditions contained in a separate written agreement entered into between JTI and a Service/Product Provider for provision of services or products, the terms and conditions in that separate written agreement shall prevail. Unless otherwise agreed in writing or set out herein, these Terms shall come into effect and become binding on a Service/Product Provider upon a Service/Product Provider confirmation on the terms and conditions set forth in a purchase order or its performance of a purchase order. Either party can terminate the Terms with a 30-day prior written notice. The Amendment Should JTI need to amend or supplement the Terms, JTI at any time may propose the amendment or supplement Service/Product Providers through electronic methods. The amendment or supplement shall be deemed as has been agreed by the Service/Product Providers to have binding effect on both parties after the Service/Product Provider confirmed its acceptance on the amendment or supplement or performed a purchase order after it became aware of such amendment or supplement. A Service/Product Provider shall notify JTI if it refuses to accept the amendment or supplement to the Terms. Shall there be any conflict between these original Terms and the amendment or supplement, the amendment or supplement shall prevail. 2. Purchase Order(s) ( PO or POs ) (d) (e) All POs shall specify details of the services or products to be provided (the Services/Products ), the fee(s) (the Fee(s) ), the date of issue of the PO, the venue and time period/delivery time for the Services/Products to be rendered and other particulars considered necessary by JTI. Before the close of business of the third working day after a Service/Product Provider receives a PO from JTI, the Service/Product Provider shall confirm to JTI whether it accepts the PO. A working day as referred to in these Terms shall mean a day on which the banks in Taiwan, the Republic of China are open for business. A failure of the Service/Product Provider to confirm acceptance of a PO in accordance with above shall be regarded as a refusal to undertake the terms in the PO. Unless otherwise provided herein, a PO shall become effective and binding once it has
(f) (g) been accepted by the Service/Product Provider. Any amendment or variation to the terms of a PO that has been accepted by the Service/Product Provider shall be further agreed upon by both parties. Should JTI s trademarks, logos, designs or other words, characters or marks that identify JTI be used by the Service/Product Provider when providing the Services/Products, the Service/Product Provider shall comply with the following: (iii) (iv) (v) The Service/Product Provider shall only use JTI s trademarks, logos, designs or other words, characters or marks that identify JTI (hereinafter referred to as Marks ) as specified and directed by JTI in writing. The Service/Product Provider shall not use the Marks on any other Items or in any piece of information in whatsoever form unless written consent of JTI has been obtained. Items related to the Services/Products bearing the Marks shall not be sold, leased, loaned or provided to any party or person other than JTI, and the Service/Product Provider shall not exhibit or display the Items in public. The Service/Product Provider shall not vary or modify the Marks in any way; hold out that it is an authorized user or owner in relation to the Marks; or engage in any act that damages JTI or infringes the rights of JTI. If the Items related to the Services/Products bearing the Marks contain any defects, the Service/Product Provider shall destroy all such Items as directed by JTI and shall not retain or otherwise dispose of those Items, and JTI may send a representative to monitor the destruction of the Items. If Items which do not bear the Marks contain defects, the Service/Product Provider may, with JTI s written consent, offer such defective Items for sale to a third party or otherwise dispose of them. If the Service/Product Provider breaches any of the above provisions, JTI may apply to the District Court of Taipei, Taiwan, the Republic of China for sequestration of the Service/Product Provider s assets without the need to provide security. Unless otherwise directed by JTI in writing, a PO confirmed and accepted by the Service/Product Provider shall not become effective if the Service/Product Provider does not comply with (f) above. 3. Sampling and Inspection 4. Delays If the provision of the Services/Products requires the production of any Items (the "Items"), JTI shall have the right to request samples of the Item(s) (the Samples ), provided that the quantity of Samples requested shall not be unreasonable. Should the Samples satisfy the requirements for the Services/Products, JTI shall notify the Service/Product Provider accordingly. The Service/Product Provider shall not commence production of the Items until JTI confirmed that the Samples satisfy the requirements. Any costs or expenses incurred for producing the Items before JTI s written confirmation shall be borne by the Service/Product Provider alone. If the Service/Product Provider fails to render the Services/Products or Items on the agreed date(s) in accordance with the PO, JTI shall still be entitled to the agreed Services/Products and Items. For each day the Services/Products or Items is/are delayed, JTI shall also be entitled to deduct 1% of the Fee(s) stated in the PO as compensation and such deduction shall be without
prejudice to JTI s other rights to seek compensation from the Service/Product Provider for losses suffered (including but not limited to losses suffered in relation to third party claims against JTI for consequential delays). Should the Service/Product Provider fail to render the Services/Products or Items on the agreed date(s) in accordance with the PO, JTI may terminate the PO at no cost to JTI and such termination shall not affect JTI s other rights to seek compensation from the Service/Product Provider. 5. Warranties The Service/Product Provider provides the following warranties:- (d) (e) (f) The Service/Product Provider warrants that: (iii) (iv) any Services/Products or Items produced in accordance with the PO shall be produced in the exact quantity and satisfy the standards, quality and other requirements set out in the PO; the raw materials and the process for the provision or production of the Services/Products or Items shall be free from defects; the value and quality of the Services/Products or Items shall not be diminished or reduced in any way and that the Services/Products or Items shall be fit for their purpose as specified in the PO; and if Samples had been provided by the Service/Product Provider and JTI confirmed that they satisfied the requirements of the PO, the Items shall conform to the Samples. Should the Product Provider deliver defective Products or produce Items that fail to conform with the Samples or be in breach of any of its warranties or undertakings, JTI shall not be responsible for keeping the defective Products or Items in its custody and may determine or dispose of the defective Products or Items at its own discretion, and the Product Provider shall be liable for any costs or expenses incurred by JTI as a result. The warranty period for the Services/Products or Items shall be in accordance with the PO. During the warranty period, if the Services/Products or Items rendered by the Service/Product Provider do not conform to the PO, JTI shall notify the Service/Product Provider who shall within 7 days provide rectification. If the Service/Product Provider fails or is unable to rectify, JTI shall be entitled to engage a third party to rectify on behalf of the Service/Product Provider, and all costs incurred shall be borne by the Service/Product Provider. In the case of an event under (d) above, JTI shall also be entitled to [1]% of the Fee(s) stated in the PO as penalty from the Service/Product Provider, and such amount shall be without prejudice to JTI s other rights to seek compensation from the Service/Product Provider for losses suffered (including but not limited to losses suffered in relation to third party claims against JTI for consequential delays). The Service/Product Provider shall, in the performance of its obligations under the PO, comply with the following:- All laws and regulations applicable in Taiwan, the Republic of China; and All of JTI s internal policies and guidelines and JTI s Code of Conduct (posted on at http://www.jti.com/how-we-do-business/code-conduct), in particular the provisions relating to conflicts of interest and anti-corruption.
(g) If JTI suffers any loss or damages, including being prosecuted or brought into litigation, as a result of the Service/Product Provider s non-compliance with (aa) and/or (bb) above, the Service/Product Provider shall indemnify JTI for all fines, penalties and compensation paid (including the legal costs of the prosecuting party) and its own costs of defending the claim and/or prosecution. That in tendering for or negotiating the PO, the Service/Product Provider has not offered, paid, provided, or promised to pay or provide any money, valuable gift or financial advantage to any staff of JTI or third party for the purpose of securing the award of and/or concluding the PO, and it shall not do any of the aforementioned acts for whatever reason. If the Service/Product Provider is in breach of the aforesaid: JTI may immediately terminate the PO, and JTI will forthwith not be obliged to pay the Service/Product Provider any fees thereunder; The Service/Product Provider shall pay to JTI a sum equivalent to ten (10) times the Fee(s) under the PO but for early termination under (aa) above; and/or (iii) 6. Fee(s), Payment and Set-Off JTI may bring a civil claim against the Service/Product Provider, report to the authorities for prosecution of the Service/Product Provider or do such other act as appropriate in the circumstances. The Fee(s) stated in the PO shall not be varied unless in accordance with Section 2. (d) (e) Should the Service/Product Provider provide the same Services /Products to a third party at a more favourable price, it shall inform JTI of the same and JTI shall have the right to apply the more favourable price to calculate the Fee(s) for the Services/Products, without any resistance from the Service/Product Provider, and above shall not apply in such circumstances. The Service/Product Provider shall request payment for the Services /Products after JTI accepts the Services/Products. The Service/Product Provider s request for payment shall be accompanied with the following documents: 7. Confidentiality an invoice bearing the number of the PO (the contents of the invoice shall comply with the requirements of the Value-Added Business Tax And Non Value-Added Business Tax Law and other regulations); and a photo describing the Services/Products or any other document evidencing acceptance of the Services/Products by JTI. JTI shall, within 45 days the Service/Product Provider provides the documents mentioned in, settle the invoice in accordance with the PO or these Terms. In the case where the PO requires the Service/Product Provider to render the Services/Products on separate occasions or in stages, the detailed payment terms and arrangements shall be subject to the separate agreement of the parties. At the time of settling the Service/Product Provider s invoice, JTI may deduct or set-off from the invoiced amount any outstanding debt or liability owed by the Service/Product Provider. The Service/Product Provider shall maintain in strict confidence and not disclose to any third party any information relating to JTI which are confidential in nature and obtained or received in the course of providing Services/Products to JTI ( Confidential Information ).
Unless otherwise provided under the Trade Secrets Act of Taiwan, the Republic of China, the Confidential Information referred to in above shall include all documents, information and data which are indicated orally or in writing as confidential. Upon JTI s notice, the Service/Product Provider shall, as directed by JTI, return to JTI all Confidential Information that it had obtained. If the Confidential Information, by nature of their form, cannot be returned, the Service/Product Provider shall destroy such Confidential Information and/or completely remove such Confidential Information from its computer database and systems. JTI may also request that the Service/Product Provider sign an undertaking to confirm that all Confidential Information has been returned, removed and/or destroyed and other related matters. 8. Intellectual Property The proprietary rights (including but not limited to copyright, trademark, patent and any other intellectual property rights) in any and all designs, diagrams and other information ("Information") provided by JTI to the Service/Product Provider belong to JTI alone. The Service/Product Provider may only use such designs, diagrams and other information for the performance of its obligations under the PO. The Service/Product Provider shall not use any of the Information to file a trademark or patent application in any country, or amend any claim in any pending patent application to expand the claim to cover or dominate any invention (whether or not patentable) disclosed or suggested in the Information. JTI may at any time demand that the Service/Product Provider return all such designs, diagrams and other information to JTI provided that the performance of the Service/Product Provider s obligations shall not be affected. The ownership of any and all copyright, trademark, patent and other rights in the Services/Products and/or Item(s) provided and/or produced and supplied to JTI under the PO or these Terms vests solely in JTI. The Service/Product Provider shall, upon JTI instructions, execute all necessary documents and do all necessary acts to ensure that such ownership is vested with JTI. The Service/Product Provider shall also ensure that the users, employees and other parties who are involved in the provision of the Services/Products or production of the Item(s) shall adhere to the requirements of this provision. The Service/Product Provider understands and agrees that upon confirming the PO or performing the PO, it shall be deemed to be agreeing to the followings: The Service/Product Provider warrants that the Services/Products provided/produced and supplied to JTI in accordance with the PO and the Terms do not infringe any intellectual property rights of any third party. If the Services/Products infringe or may infringe any third party s ( Applicant ) Intellectual property rights ( IPR Disputes ), the Service/Product Provider shall make the best effort to eliminate any litigation, compulsory enforcement, certified letter, lawyer letter, or any legal or factual claim or request filed by such Applicant against JTI. If any IPR Dispute(s) cause(s) JTI (including its directors, supervisors, managers, employees or other authorized representatives, together referred to as Recipients ), to be involved in any civil or criminal proceedings (including criminal investigations and related procedures), administrative proceedings, arbitration, mediation, settlement or other legal proceedings, the Service/Product Provider shall be liable for and shall indemnify the Recipients for any and all losses, damages, costs and expenses incurred by the Recipients as a result, including but not limited
(d) (e) (iii) (iv) (v) (vi) to any compensation or settlement amounts, legal costs, attorney's fees and other disbursements borne by the Recipients. The Service/Product Provider shall obtain the written consent from Applicants, agreeing JTI to use, possess, or sell the Services/Products continuously, and also agreeing to waive any possible civil, criminal or other liabilities against the Recipients as a result of using, possessing or selling the Services/Products. Unless otherwise agreed by JTI in writing in advance, during the course of interaction or negotiation with the Applicant(s), the Service/Product Provider shall not on behalf of JTI render any consensus, negotiation or settlement to waive any obligations of the Applicant(s), create any obligation borne by JTI or waive any rights or demurrer to which JTI is legally entitled. Any consensus, negotiation or settlement agreed between the Service/Product Provider and the Applicant(s) in relation to IPR Disputes shall be in writing, provided that such written document shall have been reviewed by JTI prior to signature. Unless otherwise confirmed in writing by JTI, the Service/Product Provider shall not execute such written document. (vii) JTI may inquire about the handling progress of IPR Dispute at any time and is entitled to review all of the correspondences between the Service/Product Provider and the Applicant(s) in relation to the IPR Dispute. The Service/Product Provider shall not object to such enquiries. (viii) The Service/Product Provider understands that JTI may at its own will negotiate and resolve the IPR Dispute with the Applicant(s). The Service/Product Provider shall be liable for all the expenses (including the lawyer fees) as a result of such negotiation. (ix) (x) (xi) Should a situation referred to in Subsection (viii) above occurs, the Service/Product Provider shall be liable for any expenses that shall be paid to the Applicant by JTI. Before the IPR Dispute with the Applicant has been resolved by litigation, mediation, settlement or any other method, the Service/Product Provider agrees that JTI shall be entitled to decline to make any payment to the Service/Product Provider no matter if the payment arising out of the Services/Products is due and shall not be liable for any liability arising out of consequential delay. Any expenses (including lawyer fees) paid by JTI in accordance with the above Subsections as the result of IPR Dispute shall be deemed as a payment due owed by the Service/Product Provider and can be deduct from the payment owed by JTI to the Service/Product Provider. If the Service/Product Provider breaches any provision of the above Subsections, JTI may apply to the District Court of Taipei, Taiwan, the Republic of China for sequestration of the Service /Product Provider s assets without the need to provide security. Unless otherwise directed by JTI in writing, a PO confirmed and accepted by the Service/Product Provider shall not become effective if the Service/Product Provider does not comply with above. The provisions of this Section shall apply to any and all the Services/Products and/or Items previously provided and/or produced and supplied to JTI by the Service/Product Provider prior to the execution/effectiveness of the Terms.
9. Others (d) The obligations under the PO are personal to the Service/Product Provider and the Service/Product Provider may not transfer, assign or novate any of its obligations to a third party without the written consent of JTI. Should any of the obligations be carried out by a third party, the third party shall be regarded as authorized by and his acts shall be binding on the Service/Product Provider. The Service/Product Provider s rights under the PO are not transferrable or assignable except with JTI s written consent. JTI s rights under the PO may, however, be transferred or assigned to a third party without the need of the Service/Product Provider s consent. JTI may immediately terminate the PO at no cost to JTI if, during the effective term of the PO, the Service/Product Provider is in or under any corporate restructuring or reorganisation, voluntary arrangement, liquidation or insolvency, merger or acquisition, dissolution, or a change in the control of the Service/Product Provider s business occurs (i.e. when there is a change in the owner or responsible officer for the Service/Product Provider s business or a change in 25% or more of the Service/Product Provider s shareholding (with voting rights attached)). The rights of JTI under the Terms are without prejudice to its other rights under the laws of Taiwan, the Republic of China. (e) The Service/Product Provider agrees that if it breaches any provision of the PO, JTI may apply to the relevant court for sequestration of the Service/Product Provider s assets without the need to provide security. (f) If any provision of these Terms shall become or be declared by the courts to be illegal, invalid or unenforceable, such provision shall be severed from the Terms without affecting the legality, validity and enforceability of the other provisions in the Terms. The headings in these Terms are inserted for convenience only and shall not affect the construction hereof. 10. Use of Personal Data (if the Service/Product Provider is an individual) The Service/Product Provider agrees that JTI may collect, process and use my personal data, including but not limited to name, Identity No., telephone, address, e-mail, bank account (jointly "Personal Data") in Taiwan during the term of the Terms and for the purposes of performance and execution of the Terms and the PO. The Service/Product Provider understands and agrees that JTI may transfer my Personal Data to JTI's database set up in other jurisdiction, that JTI will ensure that such database will also provide sufficient protection on my Personal Data. The Service/Product Provider also understands and agrees that JTI may provide my Personal Data to the third party which assists JTI in handling matters related to its business (such as a server services company) and that JTI will also ensure that such third party will provide sufficient protection on such Personal Data. JTI shall keep confidential the Service/Product Provider's Personal Data and shall not transfer the Personal Data to any other third party without the Service/Product Provider's prior written consent. The Service/Product Provider understands the I am entitled to, at any time, request JTI to cease collect, process, or utilize my Personal Data, to delete the Personal Data, to provide a copy of the Personal Data, and to supplement or rectify the Personal Data, the Service/Product Provider may not exercise my right to request JTI to cease the collection, process, and utilization and to delete the Personal Data. The Service/Product Provider understands that if I do not provide the Personal Data, I and JTI will not be able to perform the relevant rights and obligations under the Terms and the PO.
11. Governing Law and Jurisdiction These Terms and the provisions of the POs shall be governed by and construed in accordance with the laws of Taiwan, the Republic of China. Any dispute between the Service/Product Provider and JTI arising out of or in relation to the Terms and the PO shall be settled as far as possible by negotiations between the parties, failing which the dispute shall settled by the District Court of Taipei, Taiwan, the Republic of China as the court of first instance.