GW42

China Trade Terms

September2014

V1 290814

1Introduction

Thank you for your interest in becoming a trade account of Games Workshop. This document provides all relevant information in respect of the business model of Games Workshop, and the way in which Games Workshop deals with, and works alongside, its trade account customers.

2The Games Workshop Business Model

2.1Games Workshop is a global business. The success of this business is built upon the creation and growth of local communities of hobbyists across the world. Typically these hobby communities are centred upon a retail outlet of one type or another – somewhere that the hobbyists can go to meet like-minded folks, get advice, and purchase their hobby supplies. By far the most difficult, expensive and vital role for these outlets is the attraction of new customers to the hobby.

2.2Trade outlets that choose to support us in our task of recruiting new hobbyists (and retaining those we have for as long as possible) provide genuine commercial benefits to Games Workshop. On this basis,Games Workshop strives to support those outlets which help build thehobby community in their local geographic area. This is key to the survival and growth of Games Workshop. Games Workshop is a global business based on individual efforts and investments at a very local level, every day, across the globe.

3Definitions and Interpretation

3.1The definitions and rules of interpretation in this section apply in this document (and any documents referenced within this document):

Account Application Form / the application form to be completed by any business before becoming a Trade Account, as available at the Trade Web Pages or from GW on written request
Additional Discounts / the additional discounts (against Trade Prices) offered by GW to Trade Accounts, as detailed in Section 14
Advance Order Date / the advance order date assigned to any particular Product by GW, and notified to Trade Accounts by GW, which is the earliest date Trade Accounts are permitted to make that Product available for advance order
Affiliates / in relation to a company or any other type of business, its subsidiaries and holding companies and any subsidiaries or holding companies of such companies (as defined in section 1159 of the Companies Act 2006) where applicable, and any other business, company, individual, organisation or third party with which the company or business is otherwise associated with or connected to
Applicable Sales Channel / the Sales Channels through which an Outlet sells Products, as defined in Section 12.3
Authorised Text and Imagery / the text and imagery of GW displayed within the ‘Point of Sale Support’ section of the Trade Web Pages (as may be varied by GW without notice from time to time) which GW permits Trade Accounts to use in accordance with Section 22
Buying Group / aTrade Account with a group of member retailers with Outlets (not less than 6 members with ‘Live’ Outlets (Section 6)) whose payments are directed throughthe Trade Account. Each member makes independent buying decisions (without any request for authorisation from the Trade Account) in respect of their Outlets, but the Trade Account is responsible for payments to GW from its members
Central Contribution Matrix / the matrix used by GW for the purposes of calculating Additional Discounts, as set out in Appendix 2
Conditions of Sale / GW’s standard conditions of sale, the latest version of which is available at the Trade Web Pages or from GW on written request (as may be varied by GW from time to time)
Confidential Information / all information (in any form or medium) of a confidential nature relating to the business of GW which is provided in connection with the Trade Agreement, including but not limited to information relating to products and materials in development, unreleased product information any other unreleased materials, any designs, trade secrets, know-how, ideas, product specifications, product release dates, formulae, recipes, methods and techniques, processes, tactical, scientific, statistical, financial, commercial or technical information, or any other commercially sensitive information of any kind which (i) is designated as being confidential, or (ii) would cause material damage if disclosed, or (iii) would reasonably be considered to be confidential in nature
Delivery Address / the delivery address for any Outlet, as specified by a Trade Account in the Account Application Form, which must be in China (specifically excluding Hong Kong, Macau and Taiwan)
Distance Selling Channel / sale of the Products to end user customers by way of distance selling, including, but not limited to, mail order, television shopping and the Internet, and ‘Distance Selling’ shall be interpreted accordingly
ECF / as defined Section 11.3
General Outlet / an Outlet which is not actively participating in the Stockist Program
Global Release Date / midnight GMT on the worldwide release date assigned to any particular Product by GW, and notified to Trade Accounts by GW, which is the earliest date that Trade Accounts are permitted to make that Product available for sale
GW / Games Workshop Good Hobby (Shanghai)Commercial Co., Ltd (a company incorporated in the People’s Republic of China, whose principal place of business is at Room 302, Number 1035 North Nan Quan Road, Pudong District, Shanghai, 200127 P.R. China
Hazardous Products / any Products which may be categorised as explosive, flammable, toxic, corrosive or as any other dangerous or hazardous nature according to Local Requirements
Independent Retailer / any Trade Account with a single Outlet, or small number of Outlets, which makes independent purchasing and payment decisions
Initial Order Value / as defined in Section 6.2
Local Requirements / all relevant statutes, statutory rules, regulations, orders or other instruments having force of law in the relevant country or territory
Minimum Order Value / as defined in Section 6.4
MRP / manufacturer’s recommendedretail prices provided to Trade Accounts by GW
Multiple Retailer / a Trade Account with a chain of wholly owned Outlets, with more than 5 Outlets, in respect of which the buying decision is made centrally
Order / any order for Products placed by a Trade Account
Outlet / each retail premises operated by the Trade Account which stock the Products shall each constitute a single ‘Outlet’. In the case of Separated Outlets under Section 13.3, both the retail premises operated by the Trade Account, and themethod of Distance Selling associated with or connected to those retail premises shall each constitute an ‘Outlet’
POS / point of sale material which may be used to support sales of Products, which may include, but is not limited to, printed materials, racking for Products, or carrier bags
Price Lists / the price lists of GW in respect of the Products as available from GW on written request (as may be varied by GW without notice from time to time)
Primary Channel / any Sales Channel of an Outlet in respect of which the Sales Channel Ratio is fifty one percent (51%) or greater in favour of that particular Sales Channel (as determined by a Sales Channel Check)
Products / the retail range of products (including all language variations) of GW, full details of which are available from GW on written request (as may be varied by GW without notice from time to time)
Proforma Payment Terms / as defined in Section 10.4
Quality Standards / the quality standards criteria which all Sales Channels of any Outlet must satisfy, as detailed in Appendix 1
Sales Channel Check / an assessment of an Outlet by GW to determine (i) the Sales Channels through which that Outlet sells Products, and (ii) the percentage of sales of that Outlet through each Sales Channel,in accordance with Section 12
Sales Channel Ratio / the percentage of sales of an Outlet through each Sales Channel, as defined in Section 12.3
Sales Channels / the sales channels through which the Products may be sold by a Trade Account, which may include Shop Front Channel and Distance Selling Channel, and ‘Sales Channel’ shall be interpreted accordingly
Shop Front Channel / sale of Products to end user customers in-store over the counter by way of face to face transaction
Special Payment Terms / as defined in Section 10.4
Standard Payment Terms / as defined in Section 10.4
Stockist Logo / the logo set out in Appendix 3
Stockist Outlet / an Outlet which is actively participating in the Stockist Program
Stockist Program / the program through which GW rewards Outlets for stocking the Stockist Ranges, as detailed at the Trade Web Pages or available from GW on written request(as may be varied by GW from time to time)
Stockist Ranges / as defined within the Stockist Program
Text and Imagery Licence / the terms and conditions on which GW licences the Authorised Text and Imagery to Trade Accounts, as available at the Trade Web Pages or from GW on written request (as may be varied by GW from time to time)
Trade Account / any business which orders Products from GW under the terms of a Trade Agreement. A Trade Account may have multiple Outlets
Trade Agreement / as defined in Section 4.2
Trade Prices / the prices for the Products as set out in the Price Lists
Trade Terms / this document and the terms set out within this document
Trade Web Pages /
Working Day / any day which is not a Saturday, Sunday, or any other day when banks are not generally open for business in China
Year / the 12 month period commencing on 2 June 2014 and ending on 29 May 2015, and each 12 month period thereafter

3.2Section or Appendix headings shall not affect the interpretation of this document.

3.3References to Sections and Appendices are to Sections and Appendices of this document.

3.4The Appendices form part of this document, and have effect as if set out in full in the body of this document. Any reference to Trade Terms includes the Appendices.

3.5A reference to a statute, statutory provision or any subordinate legislation made under a statute is to such statute, provision or subordinate legislation as amended or re-enacted from time to time.

4Trade Agreement

4.1Any business wishing to become a Trade Account shall be required to complete and return an Account Application Form to GW. Businesses shall be responsible for ensuring that all information provided withinthe Account Application Form is accurate and complete.

4.2Any business which signs and returnsan Account Application Form agrees to comply with (collectively referred to as the Trade Agreement):

4.2.1Trade Terms, which includes

(i)Text and Imagery Licence; and

(ii)Stockist Program (optional); and

4.2.2Conditions of Sale.

4.3Upon receipt of a signed Account Application Form, GW shall review the information provided. If the requirements of Trade Terms are satisfied, GW shall confirm to the applicant business the opening of an account with GW.

4.4Notwithstanding Section 4.1 to Section 4.3 (inclusive), any Trade Account (whether or not it has signed an Account Application Form) which places an Order with GW, shall be under an obligation to comply with, and to act at all times in accordance with, the Trade Agreement, and agrees and acknowledges that all Orders are subject to, and shall be governed by the Trade Agreement.

5Term

The Trade Agreement for any Trade Account shall come into effect on the date the Account Application Form has been signed by both GW and the Trade Account, or the date on which the Trade Account places its first order with GW,and shall continue in effect until terminated in accordance with Section 19.

6Ordering Products

6.1Trade Accounts may place an Order for Products in writing (including email) or orally over the telephone. Trade Accounts shall be responsible for ensuring that their Order is accurate and complete.

6.2General Outlets are required to place an initial Order forProducts for a value not less than RMB5000 (Initial Order Value).

6.3Stockist Outlets are required to place an initial Order for the Products in Best Sellers (1) Range of the Stockist Ranges, which for the purposes of Stockist Outlets shall constitute the ‘Initial Order Value’. Please see the Stockist Program for further information.

6.4Once an initial order has been placed by an Outlet in accordance with Section 6.2 or Section 6.3, if, in the future, an Outlet places an Order for Products of a value less than RMB1000 (Minimum Order Value), GW shall not despatch that Order, and shall hold all Orders until the value of Orders on hold in respect of that Outlet exceed the Minimum Order Value. The Minimum Order Value does not apply in respect of Orders for White Dwarf and Warhammer Visions magazines. Any purchase of Hazardous Products shall not count towards the Minimum Order Value.

6.5Trade Accounts are restricted to a single Order per week per Delivery Address (up to a maximum of a single Order per week per Outlet (and Order allowances shall not be transferable between Delivery Addresses)), except:

6.5.1GW shall permit an additional Order for a Delivery Address, in any particular week, but only if that Order consists solely of Products which have a Global Release Date within the month of dispatch; or

6.5.2during the period which is 3 weeks prior to, and 2 weeks after, Chinese New Year, Trade Accounts shall be restricted to placing 2 Orders per week per Delivery Address (and Order allowances shall not be transferable between Delivery Addresses).

6.6Each Outlet shall have a status based on its ordering history:

6.6.1an Outlet which has received its first Order from GW (placed in accordance with Section 6.2 or Section 6.3) shall be a ‘New Outlet’;

6.6.2an Outlet which has paid for its first Order from GW (placed in accordance with Section 6.2 or Section 6.3) and has received a further order from GW (in excess of the Minimum Order Value) shall be a ‘Live Outlet’;

6.6.3an Outlet which has not placed an Order (in excess of the Minimum Order Value) within the previous 6 months shall be a ‘Lapsed Outlet’. If a Lapsed Outlet places an Order (in excess of the Minimum Order Value) before it becomes a Dead Outlet, the Outlet shall immediately revert back to Live Outlet status; or

6.6.4an Outlet which has not placed an Order (in excess of the Minimum Order Value) within the previous 24 months shall be a ‘Dead Outlet’

and if a Dead Outlet wishes to place an Order at any time in the future, that Outlet shall be required to place an Order for Products for a value not less than the Initial Order Value, following which the Dead Outlet shall automatically become a New Outlet as described in section 6.6.1.

6.7Trade Accounts which are Buying Groups authorise GW to make direct contact with their members for the purposes of taking and handling Orders. Buying Groups shall provide contact information in respect of their members to GW promptly upon request by GW.

7Supply of Products

7.1GW supplies Products to Trade Accounts on the Conditions of Sale. No additional or alternative terms or conditions may be imposed by Trade Accounts. The Conditions of Sale shall override any alternative terms or conditions presented or referenced on any documents provided to GW by Trade Accounts, including, but not limited to, purchase orders. The Trade Account shall be regarded as the ‘Buyer’ for the purposes of the Conditions of Sale.

7.2Subject to Section 21, and with the exception of White Dwarf and Warhammer Visions magazines,GW does not operate a sale-or-return policy. If a Trade Account attempts to return, or deposits with, or delivers to, GW, any Products which are not defective, and which have not been authorised by GWfor return, such Products shall remain at the risk of the Trade Account, and GW shall have no duty to store, or any liabilityin respect of, such Products. The Trade Account shall remain liable for payment in full (and shall not be entitled to any refund)in respect of such Products.

7.3GW reserves the right not to supply Products to any Outlet which (in the opinion of GW) is geographically located in close proximity to any Outlet of another Trade Account, or to any retail store of GW (to be determined at the complete discretion of GW).

8Delivery

8.1GW shall deliver Products to the Delivery Address,and shall endeavour to deliver all Orders within 15 days of the date of dispatch of Order.

8.2If a Trade Account requires expedited delivery, GW may be able to offer an expedited delivery service (subject to availability). Where an expedited delivery service is available, a fee of RMB750 for each RMB10,000 of Order value will be charged for this service. GW does not guarantee the availability of such a service. Expedited delivery services are not available for:

8.2.1ECF orders;

8.2.2POS;

8.2.3orders in excess of RMB100,000; or

8.2.4Hazardous Products.

8.3GW reserves the right to deliver Orders by whatever method it deems appropriate, and in separate instalments if required.

8.4If a Trade Account has specific delivery requirements these should be agreed with GW in writing in advance of making any Order for Products.

8.5Trade Accounts acknowledge that Orders for unreleased Products may not be delivered to Outlets until 18 hours prior to the Global Release Date for such Products.

8.6GW shall not be liable to Trade Accounts for any non-delivery of Products unless the Trade Account notifies GW of the non-delivery of those Products within a period of 60 days from the date of invoice issued by GW in respect of those Products. GW shall not be liable in respect of any non-delivery notified to GW after this period of time.

9Sale of Products to Customers

9.1Whilst GW publishes MRP’s, these are not binding, and Trade Accountsshall be free to select their own retail prices. GW has no right, power, authority or control over the retail prices of Trade Accounts.

9.2New release Products are subject to time sensitive Advance Order Dates and Global Release Dates. Trade Accounts shall not:

9.2.1disseminate or otherwise make available to any third party (including to any Affiliates of the Trade Account) any information in respect of new release Products prior to any Advance Order Date in respect of such Products;

9.2.2make new release Products available for Order prior to the Advance Order Date for such Products; or

9.2.3release any new release Productsprior to the Global Release Date for such Products

and if a Trade Account is in breach of this Section 9.2, then, for a period of 6 months, GW shall not despatch new release Products to that Trade Account until 30 days following the Global Release Date for such Products.

9.3If any Affiliates of the Trade Account disseminate or otherwise make available to the public any information in respect of new release Products prior to any Advance Order Date in respect of such Products, then, for a period of 6 months, GW shall not despatch new release Products to that Trade Account until 30 days following the Global Release Date for such Products.