Doing Business with SRCTec Supplier Awareness

1. Doing Business with SRCTecSupplier Awareness

2. 1 General SRCTec is working at developing partnerships with our supply base YOUR SUCCESS IS BOTH IMPORTANT AND IMPERITIVE TO US We have utilized past experience to develop this awareness document to help us BOTH be successful

3. 2 Topics of Discussion Communication SRCTec Website Quality Assurance (QA) Requirements Shipping Supplier Corrective Action Requests (SCAR) Supplier Scorecards Q&A

4. 3 Communication Your SRCTec Buyer is your primary Point of Contact Please do not contact SRC directly, regarding SRCTec purchase orders Additionally, you might also communicate with: Quality Engineering Manufacturing Engineering Supply Chain Manager Copy your Buyer on ALL communication Please advise SRCTec of key personnel changes so that we can discuss appropriate support, training, and update contact information as necessary When in doubt, please call; don�t assume anything

5. 4 Communication SRCTec expects prompt responses from you, and you can expect prompt responses from SRCTec Examples: Quote requests on or before the requested due date Supplier Corrective Action Request (SCAR) Within 1 business day of supplier notification of non-conforming product, suppliers must: Implement product containment in their facility Inform SRCTec of the impact on shipments Identify short term corrective actions Send initial SCAR responses for Problem Description and Immediate Containment Activity Final SCAR response is required within 10 business days. Return Material Authorization (RMA) number within 2 business days Information requests (acknowledgement and, if possible, initial feedback) within 24 hours

6. 5 SRCTec Website Please review the Suppliers section on http://www.srctecinc.com; click on the �Suppliers� tab in the upper right corner You will find: SCM-001 Supply Chain Manual FAI Checklist SRCTec Failure Analysis Inquiry Log (FAIL) QMS-D-402 SRCTec Supplier Quality Clauses Purchase Order Terms & Conditions (T&C)

7. 6 QA Requirements SRCTec has high quality standards and expects conformance to our drawings and specifications Potential issues must be addressed upfront, during the quoting process Notify SRCTec of any non-conformances and obtain approval before shipping material Submit and securely tag all First Article Inspection (FAI) items as required per SQC 09A and/or the SCM; our expectation is that all First Articles are fully functioning parts Note: All FAI product must have been built using the same process and equipment as intended for production builds SRCTec may require your process, or parts of your process, to be frozen after FAI acceptance; this will require you to notify SRCTec of any desired changes and to secure approval prior to change implementation

8. 7 QA Requirements- Material Handling Please exercise care with our product while it is processed through your facility, and ensure that transport methods are robust Inspect parts for damage and verify packaging is secure before shipping If issues arise, we will work closely with you to pinpoint the root cause of the damage

9. 8 Shipping Complete all paperwork outlined in the SCM and/or SQC and Purchase Order T&C Distinguish parts in multi-order shipments Distinguish Reworked or Replaced material as defined in SQC 08A, 08B, and 08C and/or the Supply Chain Manual Package the product to ensure clearly-marked lot integrity (if applicable) Restrain parts securely to avoid damage Note: Please remember that paperwork errors can be quite costly for both of us; take it very seriously; we do Documentation errors will negatively impact your supplier performance rating

10. 9 Supplier Corrective Action Requests (SCAR) SCAR will be generated for non-conformances as SRCTec deems necessary Your response must address the root cause and specify permanent and verifiable corrective actions Key attributes of quality SCAR responses are good root cause analysis, solid corrective action, and an on-time acceptable response SRCTec will participate in root-cause analysis upon request (as appropriate)

11. 10 Supplier Corrective Action Request (SCAR) SCAR responses will be reviewed for thoroughness and completeness, and will be accepted/rejected, by a cross-functional review board SRCTec will ask to see evidence of corrective action implementation and effectiveness during visits and audits SRCTec understands that problems arise in process and things don�t always go as planned; we do not automatically degrade your performance rating for the issuance of SCAR However, SRCTec does not want/expect to see a recurrence of a non-conformance; if we do, it will degrade your performance rating

12. 11 Supplier Scorecards There are three weighted segments that contribute to a supplier�s overall rating: Quality (weighted at 40%) � this includes performance results of both Incoming Inspection and In-Process issues Delivery (weighted at 40%) � this includes all deliveries from your company to SRCTec; it is derived by line item closure to its due date SCAR Responses (weighted at 20%) � this is the measure of acceptable responses by their due dates Sent out quarterly unless SRCTec has not received a delivery from your company within the quarter, then you will not receive a scorecard If applicable, there will be a �Best in Class� marker that will allow you to see how your performance compares to the best performer in your commodity class

13. 12 Supplier Scorecard Example

14. 13 Questions and Answers What can we address right now? If you think of something later on, please do not hesitate to contact your buyer with questions as soon as they arise; this communication will help us both ensure high quality and on-time delivery