PRO-SUPPLIER PERFORMANCE MANUAL PROCEDURE Supplier Performance Manual REVISION L December 7, 2015

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1 APPROVAL Procedure Section Process Owner Approval 1.0 Letter of Introduction 2.0 Global Competitiveness 3.0 Supply Chain Contact List 4.0 Quality Policy Statement 5.0 Quality Systems Qualifications 6.0 Process Control, Traceability, and Inspection Results 7.0 Registration, Evaluation, Authorization, and Restriction of Chemicals (REACH) 8.0 Pricing Changes and Payment Terms 9.0 Discrepant Material 10.0 Charges for Discrepant Material 11.0 Request for Deviation 12.0 Request for Engineering Change 13.0 TopWorx, Inc. Owned Tools 14.0 Delivery Requirements 15.0 Sample Submissions 16.0 Performance Reports 17.0 Calculation of Performance Scores 18.0 Nuclear Component Supplier Requirements 19.0 Revision Record Supply Chain Manager REFERENCE WEBSITES Website Document ID THIS DOCUMENT IS UNCONTROLLED IF PRINTED Page 1 of 27

2 REFERENCE DOCUMENTS Document Title 12 Month Supplier Scorecard Form Corrective Action Request (C.A.R.) Certificate of Conformance Engineering Change Order Form First Article Inspection Approval Form Kanban Purchase Order Non-Disclosure Agreement Pre-Production Approval Process Performance Testing Results Form Purchase Order Form Sample Submission Tags Supplier Deviation Request Form Supplier Monthly Scorecard Explanation Form Supplier Request for Engineering Change Form Tooling Information Request Form Warrant Form Document ID FRM-COC SQM-ECO FRM-NDA and/or FPP FRM-SST SQM-SDR SQM-SREC FRM-TIR FRM-PAW THIS DOCUMENT IS UNCONTROLLED IF PRINTED Page 2 of 27

3 Definitions/Acronyms 5 th 3 rd Prox payment term for 83 days APQP Advanced Product Quality Planning C of C Certificate of Compliance C.A.R. Corrective Action Request CTQ Critical to Quality FMD Full Material Disclosures S.D.S. Safety Data Sheet NPD New Product Development NPI New Product Innovations P.O. Purchase Order PFEMA Process Failure Mode and Effects Analysis PPAP Pre-Production Approval Process PPM Parts Per Million R.M.A. Return Material Authorization REACH Registration, Evaluation, Authorization, and Restriction of CHemicals THIS DOCUMENT IS UNCONTROLLED IF PRINTED Page 3 of 27

4 1.0 LETTER OF INTRODUCTION Dear Supplier, This manual is being provided to assist you in understanding and complying with your responsibilities as a supplier/partner to TopWorx, Inc., an integral part of the Emerson Process Management Business Platform. Our company expectations, as they pertain to our supplier base, are addressed in this manual. The Supplier Performance Manual is intended to be the guiding force that will enable you, as a supplier to TopWorx, Inc., to assist TopWorx, Inc. in providing a world-class product and/or service. It is our intention that the result will be future business success and increased market share for you, TopWorx, Inc., and TopWorx, Inc. customers. Any deviations from the policies of this manual require the written consent of the TopWorx, Inc. Supply Chain Manager or their designee. Sincerely, Peter Springhetti TopWorx, Inc. Supply Chain Manager THIS DOCUMENT IS UNCONTROLLED IF PRINTED Page 4 of 27

5 2.0 GLOBAL COMPETITVENESS TopWorx, Inc. strives to be a world-class corporation that consistently provides our customers with quality and value, speed and excellence, and experience and expertise. In order for TopWorx, Inc. to accomplish these objectives, we must be aligned with world-class suppliers that provide the same, while maintaining global cost competitiveness. While our Supplier Performance Manual and Supplier Scorecards serve as guidance tools for producing and delivering world class products and services to TopWorx, Inc., they in no way eliminate the requirement or guarantee the existence of global cost competitiveness. TopWorx, Inc. customers demand continuous improvement of cost, quality, and delivery. Therefore, TopWorx, Inc. must also expect its own suppliers to suggest and implement continuous improvement ideas in an effort to help maintain global cost competitiveness. Sincerely, James McDill TopWorx, Inc. Director of Operations THIS DOCUMENT IS UNCONTROLLED IF PRINTED Page 5 of 27

6 3.0 TOPWORX, INC. SUPPLY CHAIN CONTACT LIST Supply Chain Manager: Peter Springhetti Materials Management Team: Kevin Macherione Supply Chain Sourcing Coordinator Gary Brumley Purchasing Coordinator Jay Tewell Purchasing Coordinator Aaron Carroll Senior Inventory Analyst THIS DOCUMENT IS UNCONTROLLED IF PRINTED Page 6 of 27

7 4.0 QUALITY POLICY STATEMENT Quality Policy Statement TopWorx, Inc. will gain customer loyalty with continuous improvement and best-in-class quality, service, and responsiveness. THIS DOCUMENT IS UNCONTROLLED IF PRINTED Page 7 of 27

8 5.0 QUALITY SYSTEMS QUALIFICATIONS 5.1 Scope of Applicability All new vendors being considered for use at TopWorx, Inc. must meet at least one of the specific approval criteria as outlined below in order to be qualified as an approved supplier. 5.2 Criteria for Approval Supplier has a third party quality system certification in compliance with EN or ISO/IEC 17021:2006. Copies of either one of these documents may be obtained through the following website Results from the TopWorx, Inc. Supplier Surveillance Assessment and/or audit show that a structured quality system is effectively in place There is a documented action plan, which is shared with TopWorx, Inc. that shows evidence with timing that the potential supplier is putting a structured quality system in place One of TopWorx, Inc. s customers dictates a specific supplier to use A supplier is purchased by TopWorx, Inc. or a sub-supplier is already in the purchase supply chain and must be used to sustain business A supplier is currently approved through another Emerson/Fisher business unit. 5.3 Criteria for Rejection Supplier is not able to, or refuses to; provide any objective evidence for any of the documented approval criteria. 5.4 Supplier Audits: Suppliers must be aware that upon written notice from TopWorx, Inc. we may request a Quality System audit to confirm that the necessary processes are in place to support our material and quality requirements. Additionally, and again with written notice, suppliers may also be subject to audits by (TopWorx, Inc.) associated third parties for similar reasons. THIS DOCUMENT IS UNCONTROLLED IF PRINTED Page 8 of 27

9 6.0 Process Control, Traceability, and Inspection Results 6.1 TopWorx, Inc. urges all of its suppliers to implement the usage of control plans for process control. Process control plans should be maintained through the life of the specific part being supplied and made available to TopWorx, Inc., if needed. Critical to Quality (CTQ) dimensions noted on TopWorx, Inc. product drawings should always be included on the supplier process control plans. 6.2 Suppliers must insure traceability of all parts or material shipped to TopWorx, Inc. Packing slips must include at least one of the following: the supplier s lot number, manufacturing date, job number, or invoice number. All package labels must indicate the supplier s lot number or manufacturing date, quantity, current revision level, and the applicable TopWorx, Inc. part number. 6.3 For our certification requirements, all shipments to TopWorx, Inc. must include a Certificate of Conformance (C of C), Form FRM-COC. The C of C should be enclosed with the packing slip in a packing slip envelope attached to the outside of the package. If required, the material certifications and/or the certificates of conformance (for nuclear products) must also contain the part description and part number along with the supplier s lot number and/or manufacturing date 6.4 TopWorx, Inc. requires that all suppliers complete and sign a Non-Disclosure Agreement. THIS DOCUMENT IS UNCONTROLLED IF PRINTED Page 9 of 27

10 7.0 Registration, Evaluation, Authorization, and Restriction of CHemicals 7.1 (REACH) compliance data must be provided through the Emerson Compliance Web Portal Full material disclosures (FMD) are required to include, but are not limited to, all substance levels and total weight of the item(s) of purchase. This excludes protective packing, but includes any value added substances adhering to the item(s). To monitor suppliers who participate in the program, it is required that the following information be provided to this address: You must provide your company name, contact name, phone number, and address. 7.2 Suppliers are required to package all products being shipped to TopWorx, Inc. in such a manner that the product being shipped will arrive in a useable condition. 7.3 All material received at TopWorx, Inc. without proper identification and documentation will be considered discrepant material and will be reflected as such on the Supplier Scorecard. 7.4 TopWorx, Inc. requires all suppliers to keep evidence of all inspection results at the disposal of TopWorx, Inc. for the life of the specific part being supplied. THIS DOCUMENT IS UNCONTROLLED IF PRINTED Page 10 of 27

11 8.0 Pricing Changes and Payment Terms 8.1 TopWorx, Inc. requires that all suppliers report to the Purchasing Coordinator and the Supply Chain Sourcing Coordinator, at minimum, the underlying cause(s) of a price increase or decrease from the last purchase when a change in value is realized bases upon request for quote or purchase. Any advanced notice prior to a request or purchase is encouraged. 8.2 TopWorx, Inc. requests that all suppliers ship in full quantities within standardized packaging and not exceed a weight limit of 35 pounds. Once packaging standardization is realized, we require that it is not changed unless authorized by TopWorx, Inc. 8.3 As a part of Emerson, TopWorx, Inc. adopted policy is to move all minimum payment terms to 5 th 3 rd prox in an effort to maintain competiveness of our global supply chain. We expect our suppliers to offer TopWorx, Inc. a competitive advantage in quality, technology, speed to market, and total value. THIS DOCUMENT IS UNCONTROLLED IF PRINTED Page 11 of 27

12 9.0 Discrepant Material 9.1 All material found to be out of print specification or received into TopWorx, Inc. facility without proper documentation/identification is considered discrepant and may result in a Corrective Action Request (C.A.R.) A Representative of the TopWorx, Inc. quality organization will contact the supplier concerning any material discrepancies and/or C.A.R. s. Quality will provide information and samples to the supplier to aid in their investigation of these issues All C.A.R. responses from suppliers require written documentation of containment activity, root cause determination, and corrective action implemented. Failure to respond to a C.A.R. within the time frame specified on the C.A.R. form will result in lowering the supplier s monthly performance score. 9.2 Non-Conforming Nuclear Components Absolutely no known non-conforming nuclear components are allowed to be shipped to TopWorx, Inc. under any circumstances. TopWorx, Inc. suppliers that supply nuclear components shall have methods for control and disposition for items that do not meet TopWorx, Inc. part specifications. This definition includes any deviation from the current part print (e.g. material, dimensional, visual, etc.). These methods will include an evaluation process of the non-conformances and communicated to the supplier, who will then provide a submittal of notice to TopWorx, Inc. of any non-conformance s produced with a recommendation of disposition (e.g. use as is, repair, or scrap at supplier s site). This requirement is in addition to the Request for Deviation requirement. (See Section 11.0) 9.3 Notification of Non-Conformance In the event that the supplier becomes aware of non-conforming or suspect nonconforming product that has already been shipped to TopWorx, Inc., that supplier MUST notify the TopWorx, Inc. Supply Chain Manager in writing within 2 days from the date the shipment was discovered. 9.4 A copy of the Corrective Action Request (C.A.R.) form can be obtained upon request to the TopWorx, Inc. Supply Chain Team. THIS DOCUMENT IS UNCONTROLLED IF PRINTED Page 12 of 27

13 10.0 Charges for Discrepant Material 10.1 In the event that discrepant material is found, all costs incurred by TopWorx, Inc. due to the discrepant material are the responsibility of that supplier If the discrepant material is unusable to TopWorx, Inc. then the supplier must issue a Return Material Authorization (RMA) within two (2) business days of notification by a TopWorx, Inc. Quality Technician. Once the RMA is received, a debit memo will be issued against the supplier to cover the costs of the discrepant parts. Failure by the supplier to issue a RMA will still result in a debit memo against the supplier s account for the value of the discrepant parts. If the supplier wishes to have the discrepant material returned via a RMA, then the supplier is required to provide the account number of their preferred shipping company so that associated freight costs are paid by the supplier. In the event that the supplier does not want the discrepant material, it will be scrapped out at TopWorx, Inc If the discrepant material is deemed usable by TopWorx, Inc. by reworking then the supplier has the choice of (1) incurring all costs for the rework labor and materials (rework labor will be charged at $35.00 per labor hour), (2) to authorize the return of the discrepant material via a RMA and replace it with good stock in such a manner that the TopWorx, Inc. production and/or shipping schedules are not jeopardized, or (3) send a supplier representative to TopWorx, Inc. facility to rework the product in such a manner that the TopWorx, Inc. production and/or shipping schedules are not jeopardized If the discrepant material is deemed usable by TopWorx, Inc. by sorting, then the supplier has the choice of (1) coming to the TopWorx, Inc. facility and sorting the product themselves (as long as they can keep pace with the TopWorx, Inc. product schedule), (2) authorize TopWorx, Inc. to sort the product and the supplier incur all associated costs (sorting labor will be charged at $35.00 per sorting hour), or (3) authorize the return of the discrepant material via a RMA and replace it with good stock in such a manner that the TopWorx, Inc. production and/or shipping schedules are not jeopardized. THIS DOCUMENT IS UNCONTROLLED IF PRINTED Page 13 of 27

14 11.0 Request for Deviation 11.1 Discrepant/deviated material MUST NOT ship without receiving formal permission from TopWorx, Inc As a temporary corrective action for material supplied with an out of specification condition, suppliers must submit a Supplier Deviation Request Form (SQM-SDR) for the material that does not conform to the agreed upon print specifications. TopWorx, Inc. will either grant or deny each deviation request received A SQM-SDR must be requested by the supplier, completed, returned to the TopWorx, Inc. Supply Chain Manager or Supply Chain Sourcing Coordinator and have approval granted before the deviated material may be shipped If the deviation is approved, the product must be labeled with the TopWorx, Inc. deviation number that was assigned to the approved deviation request. Product that has been approved via the deviation process, but not labeled properly prior to shipment will be considered discrepant material If the deviation is denied, the supplier must segregate the nonconforming material and ensure that it is contained properly. THIS DOCUMENT IS UNCONTROLLED IF PRINTED Page 14 of 27

15 12.0 Request for Engineering Change 12.1 Engineering Change Initiated by TopWorx, Inc. Should there be a need for an engineering change by TopWorx, Inc., the supplier will be notified via the TopWorx, Inc. Engineering Change Order Form (SQM-ECO). The supplier may be required to attend an Advance Product Quality Planning (APQP) meeting either in person, or possibly via teleconference or videoconference, to kick-off the change Supplier Request for Engineering Change If the supplier feels there is a need for an engineering change then the supplier must contact the TopWorx, Inc. Purchasing Department using the Supplier Request for Engineering Change Form (SQM-SREC), prior to making any changes. The TopWorx, Inc. Purchasing Department will followup by returning a copy of this document to the supplier that will either grant or deny the proposed engineering change A copy of the Engineering Change Order Form and the Supplier Request for Engineering Change Form can be obtained upon request to the TopWorx, Inc. Supply Chain Team. THIS DOCUMENT IS UNCONTROLLED IF PRINTED Page 15 of 27

16 13.0 TopWorx, Inc. Owned Tooling 13.1 Suppliers that are using tools that are owned by TopWorx, Inc. are required to monitor and maintain the tool through routine inspections to prevent the manufacture of nonconforming product. The supplier shall inform TopWorx, Inc. at the first sign of any tooling that is inconsistent so repairs can be made. TopWorx, Inc. requires the suppliers to maintain records of all tooling inspections. Suppliers must make this information available to the TopWorx, Inc. Supply Chain Team, upon request A Tooling Information Request Form (FRM-TIR) is required to be completed in full after a new tool has been purchased and may be used to assess tool details prior to purchase. THIS DOCUMENT IS UNCONTROLLED IF PRINTED Page 16 of 27

17 14.0 Delivery Requirements 14.1 On-Time Delivery - TopWorx, Inc. expects 100% on-time delivery from all of our suppliers. Upon receipt of a Purchase Order the supplier is required to acknowledge delivery and pricing within 24 hours. It is mandatory that suppliers who know they will ship late notify the TopWorx, Inc. Purchasing Coordinator prior to the due date. Suppliers not achieving the minimum delivery score from their Supplier Scorecard Performance Rating may be issued a Corrective Action Request (CAR). Suppliers will then be required to provide the root cause for late deliveries and a corrective action to ensure that the issue will be resolved. Any additional costs (i.e. expedite charges, premium freight from the supplier or to our customer, line downtime/overtime charges) incurred by TopWorx, Inc. as a result of late supplier shipments will be communicated to the supplier and negotiations could take place from which the supplier could be deemed liable for the extraordinary costs incurred by TopWorx, Inc On-Time Delivery Definition The product(s) is received at TopWorx, Inc. on or up to 5 calendar days prior to the agreed upon due date posted on the applicable Purchase Order and is accompanied by all appropriate documentation. Suppliers will be responsible for all freight charges associated with late deliveries Quantity Accuracy All suppliers are required to supply quantities according to the material release. Quantities received at TopWorx, Inc. will be treated as conforming if found to be within +/- 0% of the agreed upon quantity specified on the current purchase order. Partial shipments are discouraged and may negatively impact the supplier s delivery performance on-quantity and on-time Kanban Agreements All suppliers under a Kanban agreement are expected to meet all requirements on the signed Kanban Agreement, as well as complying with all agreements made on the current Kanban Purchase Order A copy of the TopWorx, Inc. Purchase Order Form and the TopWorx, Inc. Kanban Purchase Order can be obtained upon request to the TopWorx, Inc. Supply Chain Team. THIS DOCUMENT IS UNCONTROLLED IF PRINTED Page 17 of 27

18 15.0 Sample Submissions 15.1 Purpose The purpose of a sample submission is to determine if the supplier s product conforms to all TopWorx, Inc. design specification requirements and is acceptable for production use. TopWorx, Inc. maintains the option, at our discretion, to waive submissions under certain circumstances Situations Requiring Sample Submission (see matrix below - Section 15.3) Pre-Production Approval Process (PPAP) A new part/product is being submitted for pre-production approval) Correction of a discrepancy on a previously submitted part/product Part/product that was modified due to an engineering change Tooling other than that used for the initial submission is being introduced. This would include refurbishment of existing tooling Manufacturing process change Change source for supplier parts, materials, or services NOTE: If you are unsure if or when a sample submission is required, please contact the TopWorx, Inc. Supply Chain Manager or Supply Chain Sourcing Coordinator Documentation Requirements by Situation: Situations Requiring Sample Submission Sample Parts Required (Minimum of 3 pieces per cavity) Dimensional Layout Required (Minimum of 3 pieces per cavity) Warrant Form Required (FRM- PAW) 30 Piece Capability Studies for CTQ Dimensions Required Applicable Performance Testing Required (PFMEA) Material Certificate and Applicable M.S.D.S. Required Quality Control Plan X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X Each sample submission request will be supported by a TopWorx, Inc. PPAP Purchase Order. This Purchase Order will specifically state which forms are needed when submitting samples. These forms can be found on the TopWorx, Inc. website. At a minimum, the Part Approval Warrant Form, First Article Inspection Report, Certificate of Conformance, and the Material Certifications are needed with each submission. If checked off on the PPAP Purchase Order, a PFMEA, a Capability Study (30 pieces), or a Quality Control Plan may also be required. For all First Article Samples, the parts must be labeled with a sample submission tag, which is to be printed on a bright orange label and affixed to the container Sample Submission Evaluation Process Once TopWorx, Inc. Supply Chain Department has received the required sample submission documentation and parts, the dimensional report will be verified and performance testing, when applicable, will be verified. Using the Part Approval Warrant form, the TopWorx, Inc. Supply Chain Manager, or designate, will inform the supplier of the results of the sample submission. THIS DOCUMENT IS UNCONTROLLED IF PRINTED Page 18 of 27

19 Fully Approved The part and/or product is approved for production. All dimensional, material, and performance aspects inspected have passed inspection. This approval level would permit the supplier to ship parts for production with no limitations Approved with Conditions The part and/or product is approved for production, but under special circumstances such as limited volumes, deviated specifications, etc., until Fully Approved status has been granted. New samples and documentation must be submitted and approved for any non-conformance noted in the Interim Approval before the part and/or product can be granted full approval Rejected New Tryout Required The part and/or product is not acceptable for production. New samples and documentation must be submitted for any nonconformance noted Rejected The part and/or product is rejected and TopWorx, Inc. does not require another sample submission All forms required for sample submissions are available on the TopWorx, Inc. Supplier website listed on page 1. THIS DOCUMENT IS UNCONTROLLED IF PRINTED Page 19 of 27

20 16.0 Performance Reports 16.1 Selected TopWorx, Inc. production material suppliers will receive quality and delivery performance feedback at one of the following intervals during the course of the rating year (January to December). Monthly, Quarterly, Bi-Annually, or Yearly. If there are any questions concerning the scores, please contact the Supply Chain Manager or the Supply Chain Sourcing Coordinator Rating Definitions Quality PPAP - number of defective parts found during the testing/qualification process and determined to be a supplier defect divided by the number of parts received for the month and multiplied by 1,000,000 (10% of total Quality Score) Receiving Rejects number of defective parts found during the receiving inspection process and determined to be a supplier defect divided by the number of parts received for the month and multiplied by 1,000,000 (10% of total Quality Score) Internal Rejects - number of defective parts found during the assembly process and determined to be a supplier defect divided by the number of parts received for the month and multiplied by 1,000,000 (20% of total Quality Score) End User Rejects - number of defective parts found by a TopWorx, Inc. customer and determined to be a supplier defect divided by the number of parts received for the month and multiplied by 1,000,000 (40% of total Quality Score) C.A.R. Response The number of C.A.R. s not responded to on time as described on the C.A.R. (20% of total Quality Score) Delivery On Time Delivery The sum of the number of pieces that were received late or were received more than five (5) calendar days earlier than the agreed upon delivery date divided by the total number of pieces received for the month multiplied by 1,000,000 (60% of total Delivery Score) On Quantity Delivery The sum of the number of pieces that were in excess of 10% over the agreed upon delivery quantity or were short shipped divided by the total number of pieces received for the month multiplied by 1,000,000 (40% of total Delivery Score). THIS DOCUMENT IS UNCONTROLLED IF PRINTED Page 20 of 27

21 17.0 Calculation of Performance Scores 17.1 While the basic calculation for Test, Receiving Inspection, Build, Customer, On Time Delivery, and On Quantity Delivery is Parts Per Million (PPM) and the basic calculation for response to C.A.R. s is simply the number of late responses, the actual supplier scores will be monitored using a point system from 0 to 4. The point value can be directly correlated to the actual calculated value in each section. Each category has been weighted according to its overall importance to the total score. The weights applied to each category are posed on the form itself. The point system definitions are below Definitions of PPM s Total quantity charged to PPM The total number of non-conforming parts that will be charged to the supplier s PPM as determined by the TopWorx, Inc. Supply Chain Manager PPM Total quantity charged to PPM divided by the quantity received for the month X 1,000, Definitions of Performance Scores and Supplier Rating Preferred A Preferred Supplier has shown consistent overall quality, service, cost, and delivery performance and has a score of four (4) on their annual Supplier Scorecard and never dropping below a score of two (2) in any given month. Prices are consistently within or below market value and remain consistent within the TopWorx, Inc. fiscal year. Supplier sends advanced notification of price decreases and suggests alternatives to prevent increases. The supplier demonstrates an extra effort to meet requirements when an expedited delivery is requested and adheres to all programs and policies Supplier will be considered first for New Product Innovations (NPI) and/or New Product Development (NPD) Supplier will be considered for e-bids and additional volume from other segments, business units, and sites Supplier is considered more valued during bids and recognized as an accomplished source and may still be awarded volume despite an area within the bid that may not be exemplary Supplier will have an opportunity to enter into a long-term contract so commerce is protected for a specific length of time Standard Standard Suppliers maintain between a score of two (2) and four (4) on the Supplier Scorecards over the course of the TopWorx, Inc. fiscal year. Supplier prices remain steady with explanations of any changes. Supplier honors all contractual obligations and strives to improve in all areas of quality, service, cost, and delivery Supplier is randomly selected for e-bids Supplier pricing and lead time is randomly reviewed Supplier may be included or already included on the Supplier Scorecard for monitoring for an improved or diminished rating Supplier has an opportunity to improve status by demonstrating and meeting all the criteria listed in the Preferred status. THIS DOCUMENT IS UNCONTROLLED IF PRINTED Page 21 of 27

22 At Risk An At Risk Supplier has consistently been below a score of two (2) on their Supplier Scorecard over the TopWorx, Inc. fiscal year. This score may require a C.A.R. to be issued to the supplier. The supplier has breached long term agreements and/or Kanban agreements by missing two (2) consecutive deliveries and/or is non-responsive for five (5) consecutive business days Supplier will be removed from any new part bids Supplier will have six (6) months to improve before all current business is sourced to a different vendor and vendor is placed into a Blocked rating In the event that a supplier fails to meet a previously agreed upon delivery commitment to TopWorx, Inc. which results in past due shipments to TopWorx, Inc. customers, this could result in an immediate status change to Blocked as determined by the TopWorx, Inc. Supply Chain Team. Upon communication to the discrepant supplier regarding TopWorx, Inc. overdue customer orders, negotiations could take place from which the supplier could be deemed liable for extraordinary costs incurred by TopWorx, Inc. to expedite parts, work overtime (due to production line downtime) or pay premium freight to ship our customer order Invoicing must be reconciled before reinstatement to a Standard status occurs Blocked A Blocked Supplier has been removed or suppressed from the approved vendor list. The approved vendor list resides in the Vendor Master with the status of A Active, which will result in a change to S Suspended or D Deleted. Any vendor within this category is communicated to Emerson corporate to enter into a similar status, if all parties involved agree, to prevent any further commerce Reinstatement to an At Risk status is done on a case-by-case basis in which an audit is required A copy of the Supplier Monthly Scorecard Explanation Form and the TopWorx, Inc. 12 Month Supplier Scorecard Form can be obtained upon request to the TopWorx, Inc. Supply Chain Team. THIS DOCUMENT IS UNCONTROLLED IF PRINTED Page 22 of 27

23 18.0 Nuclear Component Supplier Requirements 18.1 Any vendor supplying a nuclear component to TopWorx, Inc. must read and become familiar with the following: Nuclear Component Definition Any component supplied to TopWorx, Inc. that will be used in whole or as a part of a finished nuclear product Recognition of Nuclear Component Part Numbers Any part number requested via a TopWorx, Inc. Purchase Order for use in the TopWorx, Inc. nuclear program will be preceded by a C Example: Part Number S-S A would be specified on the TopWorx, Inc. Purchase Order as C-S-S A if it were being purchased as a nuclear component Nuclear Supplier Qualification Categories Commercial Grade Qualification The supplier will be required to provide Material Certifications and unique lot control numbers for all shipments. Specific requirements to the Purchase Order for these suppliers will contain, but not be limited to the following: No substitutions for any material or specification called out on the part drawing All products must be new (not re-worked) unless prior approval is given by the TopWorx, Inc. Supply Chain Manager or Supply Chain Sourcing Coordinator All material shipped will be covered under a Material Certification (shipped with the parts) that contains, but is not limited to the following: Corresponding TopWorx, Inc. Purchase Order number Corresponding TopWorx, Inc. drawing number and current revision number, if applicable Material lot control number Suppliers purchase order number corresponding with the purchase of the raw material Authorized signature and date Standard Qualification The supplier will be required to provide Material Certifications, Certificates of Compliance (C of C s), unique lot control numbers, and dimensional inspection data, as requested by TopWorx, Inc. Supply Chain or Quality, for all shipments. These suppliers additionally will have a formal quality system in place and will be subject to audit of the quality system by TopWorx, Inc. or a third party auditor. This category of supplier will also be held responsible for quality record retention and non-conforming reporting requirements per the TopWorx, Inc. Supplier Performance Manual. Specific requirements to the Purchase Orders to these suppliers will contain, but not be limited to the following: No substitutions for any material or specification called out on the part drawing All products must be new (not re-worked) unless prior approval is given by the TopWorx, Inc. Supply Chain Manager or Supply Chain Sourcing Coordinator THIS DOCUMENT IS UNCONTROLLED IF PRINTED Page 23 of 27

24 All material shipped will be covered under a Material Certification (shipped with the parts) that contains, but is not limited to the following: Corresponding TopWorx, Inc. Purchase Order number Corresponding TopWorx, Inc. drawing number and current revision number, if applicable Material lot control number Suppliers purchase order number corresponding with the purchase of the raw material Authorized signature and date All material shipped will be covered under a Certificate of Compliance (shipped with the parts) that contains, but is not limited to the following: Corresponding TopWorx, Inc. Purchase Order number Corresponding TopWorx, Inc. drawing number and current revision number, if applicable Material lot control number Quantity on the order Quantity being delivered Brief statement stating that the product was produced in accordance to the referenced TopWorx, Inc. specifications Authorized signature and date Control of Non-Conforming Material per Section 9.0 of the TopWorx, Inc. Supplier Performance Manual Providing TopWorx, Inc. the right of access to the supplier s facility where the nuclear components are being produced and providing specific hold points where said parts are subjected to in-process inspection and certain pass criteria is required before that part(s) are allowed to pass to the next step in the production process Nuclear Qualification This supplier will be required to adhere to all above requirements of the Standard Qualification Supplier, but additionally will be required to prove compliance with 10 CFR Part Retention of Quality Related Records All quality related records associated with the manufacture of nuclear components for TopWorx, Inc., by both Standard Grade Qualified and Nuclear Qualified Suppliers, must be retained at the supplier site for a period of 15 years or provided to TopWorx, Inc. with each shipment of parts. Examples of quality related records would be, but are not limited to the following: In-process data Material control lot numbers Associated equipment calibration records THIS DOCUMENT IS UNCONTROLLED IF PRINTED Page 24 of 27

25 19.0 REVISION RECORD Revision Date Revision Description QSM Approval B 01/14/04 Added page 21 01/14/04 01/14/04 01/14/04 01/14/04 01/14/04 01/14/04 01/14/04 Page 6 of 21, 1 st paragraph, 4 th line, removed and existing, added (as of 1/2004). Page 7 of 21, 2 nd paragraph, 4 th line, changed boxes to package labels. Page 7 of 21, 2 nd paragraph, 5 th line, added quantity and current revision level. Page 7 of 21, 3 rd paragraph, added this paragraph outlining general packaging requirements. Page 8 of 21, 3 rd paragraph, 4 th line, changed may result to will result. Page 10 of 21, 3 rd paragraph, 3 rd line, added requirement to send deviation requests to the Supply Chain Performance Manager. Page 14 of 21, 1 st paragraph, 4 th line, changed digression to discretion. 01/14/04 Page 17 of 21, item B under Delivery, changed 5% to 10% C 03/15/04 Appendix 1, revised weighting of Quality and Delivery categories 03/15/04 03/15/04 03/15/04 Page 13 of 21, 2 nd paragraph, added Suppliers will be responsible for all freight charges associated with late deliveries. Page 13 of 21, 3 rd paragraph, added partial shipments are not acceptable and will be counted as Off Quantity. Appendix J, Scorecard layout and verbiage revised as follows: Receiving Inspection 20% of Quality Score is now Receiving; Rejects 10% of Quality Score; Build 20% of Quality Score is now Internal Rejects 20% of Quality Score; Test 20% of Quality Score is now PPAP 10% of Quality Score; Customer 20% of Quality Score is now End User Rejects 40% of Quality Score; Response to SCAR s 20% of Quality Score is now CAR Response 20% of Quality Score; On Time Delivery was weighted at 70% now it is weighted at 60%; Quantity Reliability 30% of Delivery Score is now On Quantity Delivery 40% of Delivery Score. THIS DOCUMENT IS UNCONTROLLED IF PRINTED Page 25 of 27

26 Revision Date Revision Description QSM Approval 03/15/04 D 05/11/06 Page 13 of 21, 3 rd paragraph, 5 th line, changed to say 50 pieces or less. Page 7 of 21, added item number 4 and 5 under Criteria for Approval. E 03/04/09 Added website cover page 03/04/09 Page 3, changed address 03/04/09 Page 5, updated Quality Policy Statement 03/04/09 Page 7 of 21, paragraph 2, line 2, changed packing slip should to must. 03/04/09 Page 8 of 21, added NCR for nuclear components 03/04/09 Page 20-22, added Nuclear Components Requirement Section F 07/12/10 Page 4, updated contact list 07/12/10 Page 6, updated Quality Policy G 01/12/11 Page 22, added inspection data as requested by Supply Chain or Quality. H 01/16/12 Page 4, changed TopWorx, Inc. contact list 01/16/12 Page 17, clarified frequency of when Supplier Performance Data is provided to suppliers I 05/25/12 Page 1, changed link to website 05/25/12 Page 4, changed TopWorx, Inc. contact list 05/25/12 Page 5, removed Appendices Section 05/25/12 Page 7, amended Scope of Applicability/Supplier Approval Process THIS DOCUMENT IS UNCONTROLLED IF PRINTED Page 26 of 27

27 Revision Date Revision Description QSM Approval 05/25/12 Page 8, added maximum package weight, D of C requirement, and REACH information 05/25/12 Page 9, added information on supplier price changes and TopWorx, Inc. payment terms 05/25/12 Page 10, revised RMS process 05/25/12 Page 14, changed days late/early, over ship allowance 05/25/12 Page 15, added comment on Purchase Order Acknowledgments 05/25/12 J 10/12/12 Page 16, added comment on TopWorx, Inc. First Article Approval Form Rewrote SPM to standard TopWorx, Inc. procedure format. Added definitions for supplier ratings. Revised Sample Submission matrix. 10/12/12 Page 18, Modify Section 15.0 Sample Submission Process 10/12/12 Page 6, updated the Supply Chain contact list K 4/7/15 L 12/7/15 Page 8, added section 5.4, Supplier Audits. Revised Supply Chain list contact information Page 2, change Declaration of Conformance to Certificate of Conformance. Page 3, change Declaration of Conformance to Certificate of Conformance and change MSDS to SDS. Page 6, change contact list. Page 9, change reference in 6.3 to Certificate of Conformance. Page 18, change Declaration of Conformance to Certificate of Conformance. THIS DOCUMENT IS UNCONTROLLED IF PRINTED Page 27 of 27