EXPORT COMPLIANCE MANUAL

Transcription

1 EXPORT COMPLIANCE MANUAL Prepared By: John Fusco of Locke Lord LLP (07/21/2015) Approved By: Rick Parent - Export Compliance Mgr. Revision B

2 TABLE OF CONTENTS Page 1. ASTRO-MED INC. REGULATORY COMPLIANCE COMMITMENT... I 2. EXPORT COMPLIANCE MANUAL ASTRO-MED, INC. EXPORT COMPLIANCE POLICY EXPORT COMPLIANCE MANAGER (ECM) EXPORT COMPLIANCE COMMITTEE PRODUCT EXPORT CLASSIFICATION REVIEW FORM DSP-5, APPLICATION/LICENSE FOR THE PERMANENT EXPORT OF UNCLASSIFIED DEFENSE ARTICLES AND RELATED UNCLASSIFIED TECHNICAL DATA FORM DSP-61, APPLICATION/LICENSE FOR TEMPORARY IMPORT OF A UNCLASSIFIED DEFENSE ARTICLES; FORM DSP-73, APPLICATION/LICENSE FOR THE TEMPORARY EXPORT OF UNCLASSIFIED DEFENSE ARTICLES; FORM DSP-85, APPLICATION FOR PERMANENT/TEMPORARY EXPORT OR TEMPORARY IMPORT OF CLASSIFIED DEFENSE ARTICLES AND RELATED CLASSIFIED TECHNICAL DATA EXPORT SCREENING AND ORDER FULFILLMENT EXPORT DOCUMENTS (U.S. COMPANIES) RECORD KEEPING GOVERNMENT VISITS AND INQUIRIES TECHNOLOGY TRANSFER TRAINING AND EDUCATION EXPORT DEALERS AND REPRESENTATIVES APPENDIX A - CERTIFICATE OF UNDERSTANDING - ASTRO-MED APPENDIX B - TRAINING ATTENDANCE LOG ASTRO-MED ECM APPENDIX C - EXPORT COMPLIANCE CONTACTS - ASTRO-MED APPENDIX D - ASTRO-MED COUNTRY GROUP D:2 - D:4 & E:1 END USE SCREENING (EPCI) APPENDIX E - ORDER ENTRY PROCESS NARRATIVE AND DECISION TREE APPENDIX F - FREIGHT FORWARDERS LETTER OF ENGAGEMENT APPENDIX G - ASTRO-MED PRODUCT MATRIX APPENDIX H - RESELLERS COMPLIANCE AGREEMENT AM i-

3 Astro- Med Industrial Park, 600 East Greenwich Avenue West Warwick, RI (401) Fax (401) Astro-Med Inc. Regulatory Compliance Commitment POLICY It is the policy of Astro-Med Inc., without exception, to fully comply with all export control laws of the United States and the countries where Astro-Med Inc. conducts business. This policy applies to the Company, all of its subsidiaries, and all directors, managers and employees of the Company and its affiliates. Trust, integrity and accountability are critical elements of our culture as an organization. These elements are embodied in the Compliance Program. The United States maintains a complex set of laws and regulations administered by several different agencies that govern the export and re-export of goods, technology and services from the U.S. In particular, these laws and regulations may require an export license in order to export certain products and technology and/or restrict the export of products or technology to designated destinations, end users and end uses. Please also note that exports include technical exchanges or discussions with non-u.s. nationals (including employees) regardless of their location (even in the U.S.). Each employee has the principal responsibility for ensuring export compliance in connection with its operations, including dealings with affiliates, consultants, and agents outside of the U.S. Our diligence in making sure our international shipments are handled in accordance with the law is not simply a matter of national interest, but also a matter of Astro-Med's interest, since failure to comply with the regulations could lead to the loss of export privileges and substantial fines. We cannot afford to jeopardize our ability to serve our overseas customers. Failure to comply with U.S. laws and regulations may result in the imposition of criminal and/or civil fines and penalties, including jail time and all Astro-Med employees will be subject to company disciplinary action in the event the employee is found to have willfully violated U.S. laws governing exports. The management of Astro-Med Inc. is fully committed to ensuring export compliance and expects every director, manager and employee to share in that commitment. It is the responsibility of each individual employee to be aware of and comply with the U.S. export control laws in performing their jobs. Ignorance or uncertainty about these laws will not be excused. An important part of the Compliance Program is on-going training. The Export Compliance Manager will be responsible for maintaining the compliance program which includes comprehensive and up-to-date training. If you have any question concerning how these laws apply to you or any Company activity, please contact the Export Compliance manager for guidance. Gregory Woods CEO Astro-Med, Inc. April 14, 2015 AM

4 RECORD OF REVISIONS Revision Description A Original Issuance (10/15/2013) B Manual Review and Revision by John Fusco of Locke Lord LLP (07/21/2015) AM i

5 2. EXPORT COMPLIANCE MANUAL Astro-Med, Inc. and its affiliates and subsidiaries are firmly committed to strict adherence to all U.S. export control laws and regulations including the Export Administration Regulations (EAR) and International Traffic in Arms Regulations (ITAR) as well as other regulations relating to international dealings. In this regard, Astro-Med is committed to full compliance with all applicable export requirements pursuant to U.S. law including, but not limited to, those laws administered and enforced by the U.S. Department of Homeland Security, U.S. Department of State, the U.S. Department of Commerce, Bureau of Industry and Security, as well as the U.S. Department of Treasury, Office of Foreign Asset Control. Under no circumstances should the export of ITAR or EAR-controlled technical data, software, or commodities take place contrary to U.S. export control laws and regulations. Administrative, civil, and criminal penalties exist for violations of export control laws and may be imposed against the Company and/or individual employees. Because of potential serious consequences associated with failing to comply with U.S. export control laws and regulations, all employees must be aware of their obligations for full compliance. In accordance with the various U.S. laws and regulations, Astro-Med has established and implemented an export compliance policy and procedures to comply with the policy and U.S. export controls and regulations. Astro-Med s compliance policy and procedures are detailed in this Manual. Astro-Med s Export Compliance Manual should be used not only as an educational tool, but also as a practical guide in the course of day-to-day order processing and any licensing management for all departments involved. Compliance with the U.S. Export Laws is every employee s job, and each employee involved in international transactions should use this Manual to become educated with respect to his or her responsibilities. Deviation from compliance could jeopardize our Company s ability to export products. Failure to comply may result in disciplinary action by Astro-Med. This Export Compliance Manual will be maintained and distributed by the Export Compliance Manager (and is posted on the Company s Intranet site and available to all employees). The Manual is revised as necessary, due primarily to regulatory changes or changes in Astro-Med s export process. Human Resources will provide all new employees, at time of hire, with a copy of the Regulatory Compliance Commitment issued by Gregory Woods, CEO of Astro-Med, Inc. All new employees associated with export activities will be briefed on this Export Compliance Manual by the Export Compliance Manager, as an introduction, and will be asked to sign a Certificate of Understanding (Appendix A) prior to engaging in an export related activity. Any person currently employed at time of issuing the manual will be trained and documented Training Attendance Log (Appendix B). AM

6 3. ASTRO-MED, INC. EXPORT COMPLIANCE POLICY A. Introduction Exports of goods and services are a significant part of the sales of Astro-Med, Inc. and its subsidiaries (the Company ). Adherence to export control laws and regulations is essential to this process. Failure to comply may subject the Company and/or its employees to penalties, including fines, imprisonment, and loss of export privileges. Such penalties, and the adverse publicity and expense which could result even from an accusation of an export violation, could seriously damage the business of the Company. B. Policy It is the policy of the Company to comply with all export control laws and regulations pertaining to its operations. The Company will conduct all of its export-related activities, including sales and shipments of products and transfers of technology, in a manner intended to satisfy its obligations under export laws and regulations of the United States and of other countries in which it conducts business. C. Applicability This Export Compliance Policy is applicable to all employees and operations of the Company throughout the world. This Policy is particularly important for employees who are directly involved with exports, such as those who participate in the sale or shipment of products, services, or technical data to non- U.S. destinations. Employees also must keep in mind that an export can occur not only by shipping products or technology to another country, but also by other activities - for example, an export from the U.S. can also occur by 1) an employee in possession of U.S. technology engaging in technical discussions with a foreign person (a person who is not a citizen or permanent resident of the United States) - wherever the discussion takes place, or 2) a foreign person touring facilities of a U.S. operating unit, or 3) a foreign person accessing technology of a U.S. operating unit as an employee, consultant, or subcontractor. These other activities result in exports - referred to as deemed exports - because it is assumed that the technology accessed by the foreign person has moved, or inevitably will move, to the country of which he/she is a citizen. D. Responsibility 1. The Export Compliance Manager is responsible for the monitoring of the export process and for application of this Export Compliance Policy. Managers of each department are responsible for assuring development and implementation of procedures to ensure compliance with applicable export laws and regulations. See Section 3 for further details on Export Compliance Manager s responsibilities. 2. The Manager of an operating unit has principal responsibility for developing and implementing procedures for compliance with export compliance requirements. AM

7 3. Any employee who becomes aware of a possible violation of export control laws or regulations shall promptly report these concerns to the Export Compliance Manager. 4. Any employee who condones or permits noncompliance with export control laws or regulations will be subject to disciplinary action by the Company, up to and including termination of employment. 5. The Company has established an Export Compliance Committee which will assist in the facilitation and implementation of Astro-Med s Export Compliance Policy. See Section 4 for further details on Export Compliance Committee s responsibilities. AM

8 4. EXPORT COMPLIANCE MANAGER (ECM) The Export Compliance Manager has responsibility for ensuring day-to-day monitoring of all exports of the operating unit and for its compliance with export compliance procedures. Duties to be performed, either directly or indirectly, include: Reviewing and complying with the requirements of the Company s Export Compliance Policy and this Export Compliance Manual Implementing a procedure/policy to notify the Export Compliance Manager immediately upon learning a situation has occurred which needs to be addressed at the Compliance Manager s level (Ex. Need for a license or license exception, fails a screening or red flag surfaces, any concern regarding the request that does not feel right without having the Compliance Manager review, etc.) Coordinating the determination of the jurisdiction (United States Department of State or Commerce) and/or classification of each item (commodity, software, or technology) which may be exported. The export classification of the product or item subject to the jurisdiction of the Department of Commerce is its Export Control Classification Number (ECCN) under the EAR. The export classification of the product or item under the jurisdiction of the U.S. State Department is its category under ITAR. Ensuring proper Screening process of proposed exports, as per Section 5 of this Manual, and documenting the screening as evidence of export control compliance Applying for and obtaining all necessary licenses and approvals for exports The principal interface with the export regulatory agencies Providing oversight for export compliance education and awareness to all employees involved with export activities Preparation and oversight of export compliance assessments companywide Assuring that contractual agreements that apply to Export Compliance include provisions for compliance with applicable export statutes and regulations and for termination or cancellation if applicable laws or regulations preclude export Ensure export records for all export transactions, including contract, shipping, financing, and all other documents pertaining to each export are maintained and accessible where necessary In the event that the Export Compliance Manager is not available, please refer all inquire/requests to the International Sales Group (see Appendix C). AM

9 5. EXPORT COMPLIANCE COMMITTEE A. General The principal responsibilities of the Committee are to oversee the export compliance process on a top line level and assist the Export Compliance Manager on an ad hoc basis as necessary. B. Membership of Export Compliance Committee The members of the Export Compliance Committee shall be appointed by the Export Compliance Manager of the Company and shall include at least one member of senior management of the Company and one or more members from the finance team. See Appendix C for current Members of the Export Compliance Committee. In addition, the Export Compliance Committee may utilize the assistance of other employees of the Company, retain support staff, and engage outside experts as it deems helpful or necessary in performing its function. All questions concerning the implementation of this policy or its interpretation shall be directed to the Export Compliance Committee. AM

10 6. PRODUCT EXPORT CLASSIFICATION REVIEW To be export compliant, a company must know how its products fit within, and are affected by, export regulations. Each product or item - commodity, technology, or software - must be reviewed to determine which government agency has export jurisdiction over the item, and hence controls the export. Additionally, the proper category or export classification of the item must be determined. Classification of products is important both for U.S. companies and for those non- U.S. companies whose government regulations include lists or annexes of export-controlled items. Both agency jurisdiction and export classification are essential in assessing whether an export license is required in order to ship the item. A. Determining Agency Jurisdiction The U.S. Department of Commerce s Bureau of Industry and Security (BIS or Bureau) is charged with the development, implementation and interpretation of U.S. export control policy for commercial and dual-use commodities, software, and technology (and related technical data). Dual-use items subject to BIS regulatory jurisdiction are mostly for commercial use, but can also have military applications. The regulations governing exports of commercial and dual-use items are included in the Bureau s Export Administration Regulations (EAR). These commercial and dual-use items are listed on the Commerce Control List (CCL) of the EAR. Items which are defense articles and services (and related technical data) are controlled by the U.S. Department of State through its Directorate of Defense Trade Controls (DDTC). Commercial items which have been specially modified for military use, even if the modifications or design changes are minor, may be considered defense articles controlled by the DDTC - even though the products are almost identical to commercial items. A Commodity Jurisdiction (CJ) request may be submitted to the Department of State to obtain an official determination whether an item is controlled for export by the Department of State or the Department of Commerce. Also, certain nuclear-related items are controlled for export from the U.S. by the Nuclear Regulatory Commission (NRC). For example, radioactive materials such as special nuclear materials and byproduct materials, as defined in portions of the Code of Federal Regulations (e.g., 10 C.F.R. 110), are controlled by the NRC. If the item is believed to be a defense product, service, or technical data, or if there is uncertainty whether it is controlled for export purposes by the Commerce Department or instead by the State Department, a Commodity Classification or Commodity Jurisdiction Request should be pursued prior to export. B. Classification of Products There are two principal ways of determining the classification of a U.S. item: Informal (Internal) Review - by review of the item (particularly its technical parameters) in conjunction with the Commerce Control List of the EAR and/or the U.S. Munitions List if the item is military or defense-related in character, or the applicable AM

11 NRC regulations if it is nuclear-related. This review should include involvement of inhouse technical personnel with knowledge of the product. Formal Review - by submission of a formal written request to the U.S. Government. The written request to BIS, termed a Commerce Classification Request, requires the submission via the Bureau s on-line system called SNAP. The request should contain a description of the item, a recommended Export Control Classification Number (ECCN) for the item (or EAR99, if applicable), and an analysis of the technical parameters of both the item and the ECCN. Product brochures or data sheets, if available, should be included with the request, and a cover letter is also recommended - containing a description of the item(s) and the requester s views as to why she/he considers a particular ECCN to be the correct category for the item. Assistance in preparing a Commerce Classification Request, or a Commodity Jurisdiction request, needs to be coordinated through the designated product specialist under the direction of the ECM. The ECM will submit these requests to the Department of Commerce or Department of State, as applicable. The Product Classification Sheet (Attachment B) will be used for documenting results of product classifications. This Sheet will also contain the following for each product: ECCN, Schedule B Number, export license symbol, and the countries for which an export license is needed based on product classification / country screening. If there is Software which is to be shipped with a product, (or sent separately), this should also be analyzed, as should technology (e.g., technical manuals, drawings, etc.) the Commerce Control List of the EAR has categories or classifications (ECCN s) for these items as well as for commodities. Commerce Classification Requests are strongly recommended. Official written classifications may help avoid inadvertent errors or misinterpretations, particularly for items that do not fit neatly into a particular ECCN. It can be very helpful to have written, up-to-date evidence of what the Government considers the proper export classification of a product since this avoids the possibility of a dispute with Government export enforcement officials. Owner Responsibility: Engineering (see Appendix C for list of contacts). C. Export Licensing Decisions and Processes 1. Laws Governing Export Controls. The Export Administration Act (EAA) of 1979 as amended 50 U.S.C. app (EAA). EAA grants authority to various Federal agencies to regulate exports. The agencies in question include the United States Department of Commerce via the Bureau of Industry and Security and the U.S. Department of State via the Directorate of Defense Trade Controls. 2. Commercial use items and items that are considered dual-use (i.e., items that have a defense application but may be used in a commercial setting are considered dual-use if they are not specifically designed for the military), are governed by the Export Administration Regulations (EAR). The EAR is located in 15 C.F.R. part 730 et seq. A critical component of the EAR is determining the Company s Product s Export Control Classification Number (ECCN). ECCN numbers are derived from a matrix contained at 15 C.F.R. part 774 sup. 1. AM

12 ECCN numbers are broken down into categories 0 through 9. Further defined by product groups such as equipment assemblies and components, materials, technologies and software. 3. The ECCN denotes the type of export control imposed on an item. Export controls are imposed on items for various policy concerns including national security, technology, nuclear nonproliferation, foreign policy and crime control. 4. Not all products have an ECCN number. Some products are removed from the EAR and are designated EAR 99. EAR 99 is a generic term indicating the government has not imposed a specific Export Control Classification Number. It is important to note that the majority of all products defined as EAR 99, while requiring licensing review, more likely than not, do not have export licensing requirements unless certain prohibitions apply. The prohibitions causing an item defined as EAR99 are listed in 15 C.F.R (b). The following export control decision tree diagram should assist in determining whether or not your item is subject to the EAR and either has an ECCN number or is EAR 99. Once you have determined whether you have an ECCN number for your item, or if it is EAR 99, continue to follow the steps in the decision tree to determine if a license is required. AM

13 Export Control Decision Tree Subject to the EAR? (see ) No Exit the EAR (Supp. No. 1 to Part 732) Yes ECCN Yes Is your item classified under an ECCN on the CCL? (General Prohibitions 1, 2, & 3) (See Supp. No. 1 to Part 774) No EAR99 Do General Prohibitions 4-10 apply? (See 736.2(b)(4-10)) Do General Prohibitions 4-10 apply? (See 736.2(b)(4-10)) Yes No Is there an "X" in the box? (Using the Commerce Country Chart and the CCL) No License Required" (NLR) (See 732.5(a)(I)(ii) & 758.1(a)(3)) Yes Yes Is a License Exception Available? (See Part 740, including "restrictions that apply to all licenses Yes Use License Exception (See 740.1) No Submit an application for license (See Part 748) AM

14 Steps for Using the EAR? N O T Am I involved in an activity described in 734.5, e.g., related to the proliferation of chemical or biologic weapons, nuclear explosive devices or "missiles"; technical assistance with respect to encryption; or activities prohibited by any order issued under the EAR See Section 734.5(a), (b), and (c) No YES S U S U B J E YES YES Is the item I am planning to export or reexport subject to the exclusive jurisdiction of another U.S. Government Federal Department or Agency? See Section 734.3(b)(1) No Does my export or reexport consist of prerecorded phonograph records, printed books, pamphlets & miscellaneous publications as described in the EAR? (See Section 734.3(6)(2) No B J E C T C T YES Is the technology or software I am planning to export or reexport publicly available (excluding encryption items)? (See Section 734.3(b)(3) No T O T O Is my item in the United States? (See Section 734.3(a)(1) No YES T H T Is my item outside of the U.S., but of U.S. origin? (See Section 734.3(a)(2) YES E H E No Does my foreign-made item incorporate controlled U.S. origin items that exceed the de mininis limits defined in section or Supp. No. 2 to part 734 of the EAR, or is it ineligible for de minimis? YES (See Section 734.3(a)(3) YES E A E No R A R No Is the foreign-made item a direct product of U.S. origin technology or software, as described in section 736.2(b)(3) of the EAR, and the destination is Cuba, Libya, or a destination in Country Group D.1? (See Section 734.3(a)(4) and (5) YES AM

15 ITAR If the Astro-Med product is not subject to the Export Administration Regulations and is either not commercial or a dual-use item, it must reviewed against the International Traffic and Arms Regulations (ITAR) 22 C.F.R. Chapter I, Subchapter M, Parts to determine whether the product is subject to ITAR. Part 121 of the regulations enumerates the items contained on the munitions list. In the event you are manufacturing a product for the defense department or an agency thereof and it is not one of the twenty specifically delineated items on the munitions list, you must consider whether or not your item falls under Category 21, "miscellaneous article". In Paragraph A of Category 21, the miscellaneous articles subject to the U.S. Munitions List is any article not specifically enumerated in other categories of the U.S. Munitions List which has substantial military applicability and which has been specifically designed, developed, configured, adapted or modified for military purposes. To determine whether your item is subject to the EAR or the U.S. Munitions List and therefore ITAR regulations, the Export Control manager may submit a CJ directly to the U.S. Department of State Directorate of Defense Trade Controls. In the event the DDTC determines that the item has an ECCN number or is EAR 99, all licensing applications will be filed with the Department of Commerce. In the event the item is determined to be on the U.S. Munitions List, file the export license application with the United States Department of State, Directorate of Defense Trade Controls or the Defense Technology Security Administration. (Please note the Defense Technology Security Administration, is the licensing review arm of the Directorate Defense Trade Controls, specifically charged with reviewing licenses for the aerospace industry.) Regulation of Manufacturers of Defense Products of Services Registration of manufacturers and exporters; 22 CFR 122.1(a) requires that manufacturers in the United States who engage in the business of manufacturing or exporting defense articles register with DDTC. The section defines engaging in the business of manufacturing or exporting defense articles or furnishing defense service as even one instance of manufacturing or providing defense services. Therefore entities who contract with the U.S. military for services must register. Astro-Med maintains a current registration with DDTC. Fees Along with the registration application and cover letter, Astro-Med pays an annual fee to DDTC in the amount of $2, (22 CFR 122.3). The fee of $2, covers the cost of the annual registration and the first ten ITAR licenses. In the event a company anticipates filing more than ten license applications under ITAR in any twelve month registration period, the registration fee is $2,750 plus $250 per application after twenty applications have been filed and licenses have been granted. Licensing Guidelines and Instructions - ITAR The company will need to determine the type of ITAR license is required for the export. The most common DDTC forms used by U.S. Company s exporting defense articles include: AM

16 1. Form DSP-5, application/license for the permanent export of unclassified defense articles and related unclassified technical data. 2. Form DSP-61, application/license for temporary import of a unclassified defense articles; 3. Form DSP-73, application/license for the temporary export of unclassified defense articles; 4. Form DSP-85, application for permanent/temporary export or temporary import of classified defense articles and related classified technical data. All of the aforementioned forms except for the DSP-85 may be submitted as an electronic filing. The DSP-85 may only be submitted as a hard copy form. Deemed Exports The "Deemed Export Rule" is most often encountered in the employment context when a company releases controlled technology or software to a foreign national. It is important to note that the Deemed Export Rule does not apply to the release of similar technology or software to persons lawfully admitted as permanent residents in the United States and does not apply to persons who are protected individuals under the Immigration and Naturalization Act (8 U.S.C. 1324B(a)(3)). To apply for a deemed export license for Employee who is presently in the U.S. and employed at Astro-Med under an H1B Visa (or other visa program for similarly situated employees), the Sponsoring company will be required to file for a license as usual with the following additions or clarifications: Astro-Med will be required to complete the basic export license application Form BIS 748P. This form can be found on the Department of Commerce website which is accessible through the SNAP-R application likewise situated in the Commerce Department's website. In addition to the basic information on BXA-748P Form, the Sponsoring Company will be required to provide additional information not customarily required when completing license application of a product on the SNAP-R form: (a) Block 2: provide the telephone extension for Employee; (b) Block 6: check the box labeled "letter of explanation" and check the box labeled "other". These two additional requirements will allow sponsoring company to provide a letter of explanation and Employee's resume; (c) Block 9: Special Purpose. Transfer of controlled technology to a foreign national pursuant to section 732.2(b)(i) of the EAR; (d) Block 14: For the applicant please list Employee s full name and his/her address which requires a street address (no P.O. box numbers); AM

17 (e) Block 19: Labeled End User. Please provide the evidence of Employee s U.S. immigration status and enter his/her full address in the United States and list his/her home country including the street address; (f) Block 21: Specify how the controlled technology and/or software that Employee receives is to be used in his/he employ and also include a description of the End Use. For example, simply stating for research purposes not sufficient. Sponsoring company will be required to explain the nature of Employee s research or other contributions to this type of technology; (g) Block 22(j): Sponsoring Company must identify the various items as specifically as possible including each item s Export Control Classification Number (ECCN number). If possible, Sponsoring company should provide a copy of the technical specifications of the products Employee will be working on; (h) license; Block 23: List the dollar value for the transfer at a nominal amount, usually $1 per (i) A letter of explanation. In the letter of explanation the Sponsoring company should identify all parties to a transaction, in other words, please try and identify all parties Employee will be working with at Sponsoring company including their full name, their citizenship and if they are here on a U.S. green card, their passport number and green card number. Also Sponsoring company should provide a full description of its products and services stating the types of products Sponsoring company typically manufactures, as well as any limitations imposed on Employee s access to controlled items; (j) As the license will be valid for a two year period, the Sponsoring company should describe all locations including the full address of Employee s employment for the two year period; and (k) The Sponsoring Company should describe any foreign compatible software or technology and availability to foreign nationals outside of the U.S. and therefore not subject to U.S. export controls. In addition to the letter of explanation, Employee will need to provide a resume. The resume should include his/her personal background information, his/her educational and/or vocational background, and his /her previous employment history including the names of all employers and the full address for the same. Included in that employment history should be a brief description of his/her responsibilities at his/her past foreign employer(s). Employee will need to provide his/her prior military service listing the dates and places serviced, his/her highest rank attained and all activities he/she performed. If Employee will have access to ITAR controlled items, in addition to the above filed with the Commerce Department, the Sponsoring company will need to file a license request with the Department of Defense specifically the Directorate of Defense Trade Controls (DDTC) a license form labeled DSP-5. The DSP-5 includes all of the above information to the Commerce Department and additional disclosure of Sponsoring company s internal procedures for controlling release of technical data to foreign persons and controls for preventing unauthorized access to defense articles. This license will be for a period of four years or the termination of AM

18 Employee s employment at Astro-Med if the Employee s term is shorter than 4 years. In the event Astro-Med is required to submit a license to the Directorate of Defense Trade Controls, the Employee will be required to execute a Non-Disclosure Agreement NDA which must be maintained on file and copied to the Directorate of Defense Trade Controls. (Please see draft in list of forms.) Commodity Jurisdiction Request A commodity jurisdiction (CJ) is a request used to determine whether an item or service is subject to export licensing by the Department of Commerce or the Department of State (pursuant to the Directorate of Defense Trade Controls (DDTC)). While the Bureau of Industry and Security is the primary licensing agency under the Commerce Department for commercial use and dual-use exports, the DDTC licenses defense articles and services. In the event a company cannot determine which export licensing body is the proper authority for submitting license applications, the company should request a commodity jurisdiction determination. Note: a company may also submit a Commodity Jurisdiction Request if it believes that the jurisdiction of an item has been incorrectly assigned to the Directorate of Defense Trade Controls and should be assigned to the Commerce Department s Bureau of Industry and Securities. A Commodity Jurisdiction Request and resulting determination is not license approval for the actual export. The end result of the Commodity Jurisdiction Request should be placed on the export license application for the official export license. Commodity Jurisdiction Requests are prepared by the company and filed with the Directorate of Defense Trade Controls pursuant to 22 CFR 120.3, Under 22 CFR entitled Commodity Jurisdiction Request ; the company shall identify the article or service and include a history of the product s design, development and uses. Any supporting documentation such as brochures, specifications, marketing materials or other documentation related to the article or service must be submitted with your Commodity Jurisdiction Request. The company should provide the DDTC all information that it believes will assist the DDTC in determining the proper jurisdiction for the article. At the very least the company must provide the number, variety and availability of civilian use and civilian applications as to the nature, function and capability of the civilian applications and finally, the nature, function and capability of military applications. It is important to note that in the event the information appears to be vague or incomplete, the DDTC policy is generally to require licensing under ITAR. Therefore more detail is always better. Practice Tip: Caution. DDTC has maintained that even an unambiguously civilian end-use item must be treated as an ITAR controlled item while a CJ request is pending. If a company submits a CJ request to the DDTC, it assumes the item is military until proven otherwise. To treat the item as a Commerce Department EAR controlled item runs the risk of an enforcement action for unlicensed exports if in fact DDTC were to rule that the item is controlled under the ITAR. Reasons to submit a CJ Request: (a) It eliminates confusion among the personnel within Astro-Med. AM

19 (b) It makes customers more confident in the product they are buying or having it incorporated into their end item. (c) applications. (d) It eliminates concerns regarding the flow of military technology to commercial It gives comfort to management and high-risk transactions. (e) Eliminates any concerns that your competitors are alleging your item is ITAR controlled and the company is not properly licensing it; and finally, (f) Provides the company with a clear understanding from export enforcement officials as to the nature of the technology and whether or not the Government believes exports for those items should be carefully controlled. Practice Tip: Focus is often whether the item is somehow unique to the military or has only a military use. If the item can be replaced without modification in to a commercial end item, then while used in a military setting it may be a dual use item. If DDTC determines that the item while used specifically in a one-time contractual instance for the military if in other instances the item is interchanged with commercial items, DDTC will usually rule that the item is dual use and subject to the EAR. AM

20 7. EXPORT SCREENING AND ORDER FULFILLMENT A. General Each potential export of an item must be screened against applicable export compliance requirements to determine whether the export can proceed (with a license if necessary). Exports that fail one or more export screening processes should be placed on hold until the failure can be resolved. The requirement to screen applies to all orders for exports, even those involving items which appear - based on their jurisdiction and/or ECCN s - to be eligible for export without a license. The screens processes that must be applied to each export are the following: i) Product Classification / Country Screen (a) U.S. Department of Commerce: Some transactions require that export licenses be obtained due to the nature of the product and the government controls imposed on the product s export to certain countries. The screen associated with that evaluation is referred to as the product classification / country screen. If the item to be exported is controlled by the U.S. Department of Commerce, product classification / country screening is performed by reference to the Commerce Control List (CCL) and the Commerce Country Chart (respectively, Part 774 and Supp. No. 1 to Part 738 of the EAR). The Export Control Classification Number (ECCN) of the product on the CCL indicates the reason(s) for control and some of the license exceptions which apply. The reasons for control are used in conjunction with the Commerce Country Chart to make an initial determination of the need for an export license. If this initial screening indicates an export license is needed ( x in the box for the country and applicable reason for control), then a check should be made whether a license exception is available so as to avoid the need for a list-based export license (See Part 740 of the EAR). If an exception is found or there is no x in the box, then the other screens must be applied - until all screens referred to in Section 5 have been applied and documented. If no exception is found, then a license must be applied for and obtained prior to shipment. Note: This screen can be performed either before or after the other screens listed in Section 5. The products exported by some companies will be in the catch-all category (EAR99) such that no export license appears required to export the product to most destinations (except to customers in embargoed and of concern countries). However, the other screens (as listed ii-v below) must still be performed even if results of product classification / country screening indicate that no license is required. This is because results of one of the other screens (e.g., end use / end user considerations) may prevent the transaction or require that an export license be sought and obtained prior to shipment. AM

21 (b) U.S. Department of State: If the item is controlled by the Department of State or the Nuclear Regulatory Commission, then the regulations of that agency must be followed (see International Traffic in Army Regulations). In most cases, licenses will be required to ship any Department of State-controlled item to any destination. Currently Astro-Med has controlled items under ECCN 3A992 and ECCN 7A994. All other products are EAR99. Batch ECCN 3A992 and ECCN 7A994 are controlled for Anti-Terrorism (AT Column1 of the Country Control Chart). Sudan identified on the Country Control Chart as needing a license to export. There are no license exceptions ii) Consolidated Screening List The objective of the Consolidated Screening List (CSL) screen is to ensure that export transactions do not involve 1) persons whose export privileges have been denied by the U.S. Government, or 2) certain other parties of concern. Among the latter are entities that the U.S. Government has identified as involved in weapons proliferation activities and high risk of diversion; specially designated nationals who are considered to be part of the governments of embargoed or of concern countries; or persons involved in terrorist activities, war crimes, or narcotics trafficking. Note that persons and entities can include individuals, companies, and other organizations. The Consolidated Screening List (CSL) is actually a combination of lists, including the Table of Denial Orders and the Entities List (from BIS), the list of Specially Designated Nationals [from the United States Treasury Department Office of Foreign Assets Control (OFAC)], and certain other lists. The Department of State also imposes trade-related sanctions on certain entities (Statutory Denied and Suspended Parties). Names are added to, and deleted from, the Restricted Parties List periodically, and are published in the Federal Register. In general, denied persons do not have the privilege of making or participating in U.S. exports because they have violated export laws or regulations or are subject to United States embargos. Companies are prohibited from selling products/services to, or otherwise dealing with, a denied person in a transaction involving export or re-export of U.S. - origin items. The specific restrictions imposed on a denied person vary; generally they prohibit any involvement of that person in an export transaction involving a U.S. item. Entities on the Denied Persons/Entities List may not be involved in certain U.S. exports, particularly as consignee or end user of an item exported from the U.S., unless an export license is obtained for the export transaction. Persons, who must be checked against the various lists noted above, include everyone known to be involved in the export - e.g., the ordering party, purchasing party, exporting party (including buyers who plan to export), re-exporting party, intermediate consignees, end-user, parties servicing U.S.-origin goods outside the U.S. banks, and freight forwarders and other transporting parties. Diversion Risk Screen This screen is performed to guard against a shipment being diverted from its initial destination to a prohibited destination - e.g., transshipped or re-exported to a country that is embargoed or to AM

22 which additional authorization would be required (b)(10) of the EAR prohibits a person from exporting or re-exporting an item if the person has knowledge that a violation of the EAR or any license exception or any governmental order has occurred, or is about to occur, or is intended to occur in connection with the item. Prior to shipping an item, certain diversion risk profile factors should be investigated. If any of these is present, further inquiry must be made to assess whether the proposed export can proceed. Below is a list of items to be aware of prior to any shipment: 1. The customer or purchasing agent is reluctant to offer information about the end use (or end user) of a product. 2. The product s capabilities do not fit the buyer s line of business - e.g., a small bakery places an order for several sophisticated lasers. 3. The product ordered is incompatible with the technical level of the country to which it is being shipped - e.g., semiconductor manufacturing equipment is ordered for use in a country without an electronics industry 4. The customer has little or no business background - e.g., information about the customer or its principals is unavailable from normal commercial/trade sources. 5. The customer is willing to pay cash for a very expensive item when the terms of the sale call for financing. 6. The customer is unfamiliar with the product s performance characteristics but still wants the product. 7. Routine installation, training, or maintenance services are declined by the customer. 8. Delivery dates are vague, or deliveries are specified for out-of-the way destinations. 9. A freight forwarding firm is listed as the product s final destination. 10. The shipping route is abnormal for the product and destination. 11. Packaging is inconsistent with the stated method of shipment or destination. 12. When questioned, the buyer is evasive or unclear whether the purchased product is for domestic use export, or re-export. 13. Customer uses only P.O. Box address or has facilities that appear inappropriate for the items ordered. 14. Customer orders parts known to be inappropriate or for which the customer appears to have no legitimate need - e.g., no prior shipment of system for which AM

23 parts are sought. 15. Customer is known to have, or is suspected of having, unauthorized dealings with parties and/or destinations in ineligible countries. Please note that the above list is not all-inclusive, in so far as any other suspicious or irregular circumstances in a transaction should also be checked. If follow-up inquiries for more information from the customer do not satisfactorily resolve doubts, the order should be put on hold, and the Export Compliance Manager contacted. If suspicions remain after such inquiries, and there is still interest in pursuing the order, then an export license should be applied for or notification by the Export Compliance Manager to the appropriate U.S. enforcement agency. In cases where Company personnel suspect that illegal activities may have taken place or are planned, and/or a person is asking them to participate in such activities, the Export Compliance Manager should be contacted to discuss further action, including bringing the matter to the attention of government export enforcement authorities. iii) Anti-Boycott Screen This screen is used to ensure that export transactions comply with U.S. anti-boycott laws and regulations. The anti-boycott screen must be performed by all of the Company s operating units. This is because the U.S. anti-boycott laws apply to non-u.s. companies under the U.S. parent if they are controlled by a U.S. company (and control is presumed if there is ownership). The U.S. anti-boycott laws extend to activities in the interstate or foreign commerce of the United States, so would include, for example, certain transactions involving items acquired from the U.S. (a) Anti-Boycott Issues U.S. export control laws and regulations prohibit certain restrictive trade practices or activities which would implement boycotts sponsored or promoted by other countries and to which the U.S. government does not adhere. The regulations also require prompt reporting of certain boycott-related requests (see Part 760 of the EAR). Prohibited activities under U.S. export anti-boycott laws include: A boycott-related refusal, or agreement to refuse to do business, or request that others refuse to do business with a boycotted country (e.g., refusing to do business with Israel in order to avoid being blacklisted by Iran or to obtain business in Iran). Furnishing information about business relationships with boycotted countries or blacklisted persons (e.g., certifying that your company has no representative in Israel as part of a condition of doing business in the United Arab Emirates, where the request for such certification is known to be boycott-related). Discriminating against religion, race, sex, or origin (e.g., agreeing with a Pakistani company that no Indians can assist in installation or servicing of a system to be exported to Pakistan). AM

24 Furnishing information on the religion, race, sex, or national origin of a U.S. person (e.g., providing information as to the religion, or membership in charitable/fraternal organizations, of the Managers or other employees of a U.S. company) in response to a boycott-related request. Implementing a letter of credit containing prohibited boycott language or conditions (e.g., a provision certifying that the company does not do business with Israel). Note that U.S. tax laws also include provisions relating to international boycotts of Israel (see 26 U.S.C. 999). These laws include reporting requirements for U.S. companies and their related (more than 50% owned) companies, both non-u.s. as well as U.S., having operations in, with, or related to boycotting countries and their nationals ( operations is defined quite broadly and includes sales). Reports must be made to the U.S. Department of the Treasury on those operations and also on any participation in, or cooperation with, an international boycott or any request for such participation or cooperation. The U.S. levies large legal and tax penalties if a U.S. (or U.S.-owned) company participates in or cooperates with an illegal boycott; it also denies tax credits if such companies engage in commercial activity with a sanctioned country. Export personnel should also keep in mind that U.S. export laws and tax laws differ as to what specific actions or conduct are reportable/non-reportable and prohibited/permissible. Compliance is required with both export-related and tax-related anti-boycott laws/regulations. (b) Boycotting Countries The U.S. Department of the Treasury is periodically required to list countries which may require participation in, or cooperation with, an international boycott that the U.S. government considers to be illegal. Currently those countries are: Iraq Libya Saudi Arabia Yemen, Republic of Kuwait Oman Syria Lebanon Qatar United Arab Emirates However, note that the U.S. anti-boycott laws are not limited to violations by the above-listed boycotting countries. Also, Israel is not always the targeted or boycotted country. (For example, a request by a Pakistani customer for a negative certification of origin such as No contract items shall be manufactured or originate in India would be an illegal boycott request.) (c) Dealing with Boycott-Related Requests Proposed transactions, especially those involving any of the above-listed countries, should be carefully checked to see whether they contain any boycott-related requests. Particular attention should be given to documents received from potential customers - e.g., inquiries asking for quotes/tenders; sales contracts; letters of credit; and other correspondence. AM

25 Any person within the Company (both non-u.s. and U.S.) who receives a request to take any action which would further or support a prohibited boycott or restrictive trade practice must determine whether: 1) The request can legally be complied with, or instead is illegal and must be refused (for example, deleted from the terms of a proposed contract, letter of credit, etc. containing the request), and 2) The request must be reported to either the U.S. Department of Commerce or Department of State, depending on the product s jurisdiction. Note that some boycottrelated requests are both illegal and reportable; others are legal but reportable; and others are legal and not reportable. Note that a report may be needed even if no order is booked. The operating unit receiving a boycott-related request should promptly inform and consult with the Export Compliance Manager so that the proper determination is made and appropriate action taken. Financial personnel should also be informed so that they can assess whether additional reporting and/or other action is needed for tax purposes. Note that there are differences in the boycott export and tax regulations - some activities that are permitted/not reportable under export regulations are not permitted/are reportable under tax regulations, and conversely. So dual reporting is essential. Reports of boycott requests, if required, must be submitted to the U.S. Department of Commerce on its form BIS-621P. Such reports are due by the end of the month following the end of the quarter in which the boycott request was initially received (or one month later for non-u.s. companies). A copy of each report should be retained by the Export Compliance Manager. When necessary Boycott screening should be documented in writing and forwarded immediately to the Export Compliance Manager. iv) Embargoed and Of Concern Countries Screen This screen is to ensure that export transactions are not entered into with customers in, or associated with, embargoed countries and countries of concern unless such exports are permitted by applicable government regulations and Company policies. All orders must be screened for embargoed and of concern countries, and must comply with the most restrictive of applicable: 1) local laws and regulations, 2) U.S. laws and regulations, and 3) export policies of the Company (and of the exporting operating unit). Potential exports to countries that are embargoed or of concern must be screened more carefully than others because of the strict controls imposed on those countries, particularly by the U.S. Government and by policies of the Company and its subsidiaries. Certain regulations of the U.S. Government apply to both U.S. and non-u.s. transactions - because those regulations control 1) goods and technology of U.S.-origin and 2) activities of U.S. persons - wherever those goods/technology/u.s. persons are located. AM

26 (a) Embargoed Countries The United States currently maintains embargoes which prohibit trade with the following countries: Cuba Iran North Korea Sudan Syria Under U.S. law, it is illegal to export products to those countries, either directly from the U.S. or by re-exporting products from an intermediate country. U.S. export laws also prohibit U.S. persons from direct involvement in exports to those countries, even if the products to be shipped are not of U.S.-origin. (U.S. law also prohibits most imports from, financial transactions with, and visits to, those countries by U.S. persons.) Accordingly, with certain minor exceptions, all Astro-Med affiliates must comply with the following relative to exports of products: Cuba - No sales or shipments, direct or indirect, may be made by any Astro-Med affiliate, U.S. or non-u.s. Iran, North Korea, Sudan and Syria - No sales or shipments, direct or indirect, may be made by any U.S. Astro-Med affiliate without the express written approval of the Export Compliance Manager. (b) Sanctioned Countries A lesser restriction on certain countries includes Export Sanctions administered by the U.S. Department of Commerce through the Bureau Industry and Security (BIS) and Treasury through the Office of Foreign Assets Control (OFAC). Currently Russia is subject to various sanctions due to its actions which violate the sovereignty of the Ukraine. The sanctions prohibit the sale of any and all defense articles to the Russian military and also prohibit long term financing. Any non-u.s. Astro-Med affiliate who is considering shipping a product to Cuba, Iran, North Korea, Sudan, or Syria or to a customer whom it s known or suspected will re-ship the product to those countries must adhere to all of the following requirements for each transaction: Prior to accepting an order, agreeing to conduct business, or shipping a product, the Astro-Med affiliate must notify and consult with the Export Compliance Manager. No U.S. person (see Notes below) may be involved in the transaction - by facilitating, approving, or financing the transaction; and The product to be shipped must, in most cases, not have been previously exported from the U.S. or be of U.S. design; and The product must not contain more than minimal controlled U.S. content; and AM

27 The transaction must comply with the export laws and regulations of the country from which the product is to be shipped - an export license must be obtained if needed; and The end use and end user of the product must be acceptable. With regard to end use, no product may be shipped if it is known or suspected that the end use will be in the development, testing, or production of weapons or systems to deliver weapons. This is particularly important for products which have dual uses - that is, could be used not only for commercial purposes but also in weapons-related activities. v) Proliferation End-Use (EPCI) The end use of U.S. products for direct/indirect use in any nuclear/missile technology, chemical or biological application maybe controlled by U.S. export regulations and should be reviewed prior to any sale. Commodities, software and technical data may not be used directly or indirectly in the design, development, fabrication or use of nuclear, chemical or biological weapons or missile technology (missiles that are capable of delivering a payload to a range of at least 300 kilometers) to country group {D:2}, {D:3}, or {D:4} without Export Compliance Department authorization. See attached Country Group List for {D:2}, {D:3}, {D:4} & {E:1} (Appendix D) In compliance with General Prohibition 5 of the EAR, no shipment may be exported without a license (or reviewed by the BIS) if it is known that the end user is involved in the following: Any nuclear activities involving, but not limited to, research, development, design, manufacture, construction, or testing of any device, facility, or component thereof. This may include item on the CCL that can be shipped NLR or under a license exception or EAR99 Any missile end-uses involving the design, development, or production of missiles in or by a country listed in Country Group D:4 (Supplement No. 1 to Part 740 of the EAR). This applies even if the listed activity does not appear on the CCL Any prohibited chemical and biological weapons end-uses including design, development and production or stockpiling See Appendix E for Order Entry Process Narrative And Decision Tree. AM

28 8. EXPORT DOCUMENTS (U.S. COMPANIES) In addition to thoroughly screening transactions, exporters need to make sure that proper export documents are utilized and completed correctly. The discussion below focuses on the AES (Automated Export System), a key identification in regards to Census data for U.S. exports and the Destination Control Statement which is required on certain U.S. export documents. Additional information on U.S. export documents is available in Part Export Clearance Requirements - of the Export Administration Regulations (EAR). A. AES The electronic equivalent of a Shipping Export Document (SED) is an Automated Export System (AES) record. AES filings are intended to improve accuracy of data, allow more realtime government monitoring of export compliance, and reduce use of paper. AES must be used for any transaction that requires a validated license from either the Department of Commerce or Department of State or the NRC. An AES must also be filed for embargoed and terrorist countries. An AES filing is required for any of the following exports from the U.S.: 1) a shipment which requires an export license, 2) a shipment where the value of products (for same Schedule B number or HTS) is over $2,500, 3) a shipment (of any kind) to Cuba, Iran, North Korea, Sudan, or Syria, or 4) a shipment to Canada if it will be transshipped (to another country) which would otherwise require an AES if shipped direct. Note that the same AES requirements apply to export shipments by mail. Shipments of intangibles or exports made electronically (such as some software shipments) do not, however, require AES. In general, only the exporter or the exporter s agent may complete an AES, and that person must be subject to the jurisdiction of the U.S. Thus a U.S. manufacturer who is also the exporter (and thus as the party in the U.S. who receives the principal benefit of the export transaction is termed the U.S. Principal Party in Interest (USPPI)) can fill out and execute an AES, and a U.S. freight forwarder can also do so if acting as the agent of the exporter. The forwarder must, however, have written authorization such as a power of attorney from the exporter. The exception to the above is a so-called routed export transaction. That is one in which a non-u.s. principal party in interest (PPI), typically the buyer, authorizes a U.S. freight forwarder in writing (as by a power of attorney) to act on his behalf to facilitate export of items from the U.S. In that case the U.S. manufacturer does not have to issue a power of attorney to the (buyer s) freight forwarder; however, usually the U.S. manufacturer would still be considered to be the USPPI and would be designated as such on the AES (see below). It is recommended that Astro-Med always prepare the AES or a draft SLI (Shippers Letter of Instructions) for the forwarder, even in a routed export transaction. This is because Astro-Med is most familiar with the items being exported, and this procedure gives Astro-Med the most control over the documentation. Furnishing an AES or SLI to the forwarder - containing all the information on the product, customer, etc. known at the time the items are released to the forwarder for shipment - helps ensure that an accurate AES record is furnished to the U.S. Government and is also a written record of the information that the forwarder received from Astro-Med. AM

29 Astro-Med should also periodically send their regular freight forwarder(s) an Export Compliance / Product Matrix letter and a Notification to Freight Forwarders (Letter of Engagement) as shown in Appendix F. The Matrix (Appendix G) lists the company s products (or at least the major ones) and their ECCN s and Schedule B numbers. The Letter of Engagement informs the forwarder what the exporter s company expects from the freight company. Astro-Med should randomly obtain a copy of the AES record from the forwarder for their export records, and the returned copy should be checked for accuracy and completeness. If any errors or discrepancies are found, a corrected AES should be submitted to Census. B. Destination Control Statement The Destination Control Statement is a notice which the EAR requires on all copies of the bill of lading, air waybill, commercial invoice, and packing slip included with each item exported from the U.S. pursuant to a license, and also for some unlicensed items. It indicates that items being exported are subject to the EAR/ITAR and remain under control of those regulations. It is recommended that the statement be used on those documents for all U.S. exports, so as to avoid the need to keep track of when it is legally required and when not. The Destination Control Statement must read as follows: EAR Hardware/Data: These commodities, technology or software were exported from the United States in accordance with the Export Administration Regulations. Diversion contrary to U.S. law is prohibited. ITAR Technical Data and ITAR Controlled Hardware: These Commodities and/or Technical Data are authorized by the U.S. Government for export only to [country of ultimate destination] for use by [end-user]. They may not be transferred, trans-shipped on a non-continuous voyage, or otherwise be disposed of to any other country or end-user, either in their original form or after being incorporated into other end-items without the prior written approval of the U.S. Department of State. C. Third Party Logistics Partners and Freight Forwarders Astro-Med will require all logistics vendors, with the exception of UPS, Federal Express and DHL, to sign the Letter of Engagement indicating compliance with AMI requirements prior to initiation of any service. See Appendix F. AM

30 9. RECORD KEEPING The Export Administration Regulations (EAR) and regulations of other agencies involved in exports require that complete and accurate records be maintained relating to all export transactions. The Export Control Manager is responsible for maintaining files containing such export records. A. Records to be Maintained The records to be maintained in connection with each U.S. export (including re-exports) include any written material relating to the export - such as export applications and licenses, end-use statements, import certificates, or documentation of the information provided to the forwarder for AES submission, air/ocean waybills, purchase orders, sales orders and contracts, invoices, receipts, letters of credit, memos and notes, telephone logs, and correspondence. A complete list of the documents required to be maintained is set forth at of the EAR. B. How Long to Maintain Records The EAR/ITAR requires that export records be retained for five (5) years from the date of the export, re-export, or any other termination of the transaction as defined in of the EAR Accordingly, Astro-Med will maintain export records for this minimum period of five (5) years. Records must be kept longer if required by applicable regulations or laws. C. Location of Records The Export Compliance Manager is responsible for ensuring that its export records are properly maintained. Records related to ongoing transactions should be located on-site in an appropriate location. Any records stored off-site should be retrievable within a reasonable time - such as no more than 48 hours. All export records should be in good order and readily available for inspection. AM

31 10. GOVERNMENT VISITS AND INQUIRIES Persons who are required to maintain export records may be asked to make them available for inspection and copying by officials of the U.S. Government. The Government can issue subpoenas for such records if voluntary cooperation is not forthcoming (see of the EAR). Any request for records by government export officials, or any visits or other contacts received from such officials, must be reported immediately to the Export Compliance Manager. Agents of BIS Office of Export Enforcement or of U.S. Customs and of the FBI do make visits to companies, sometimes without prior notice. It is important that Astro-Med personnel handle such visits appropriately. While it is difficult to anticipate how a particular visit will proceed, some guidelines are useful for dealing with them. For example, because only Astro-Med personnel who are knowledgeable on export compliance matters should interact with government export officials, the receptionist at each facility should know to direct any government official regarding export law/regulations to the Export Compliance Manager. The Export Compliance Manager should be included in any meeting with the government officials even if initial contact is with upper management. There should always be two (2) individuals from the Company in attendance. All documents provided to the Government should (if possible) be copies of records, and an extra copy should be made and retained to reflect what was provided. The delivered items should be accompanied by a letter of transmittal summarizing the writer s understanding of what was requested and identifying a contact person in the event further interaction/information is needed. No documents should be provided to the Government without prior review by and approval of the ECO. AM

32 11. TECHNOLOGY TRANSFER Under the EAR and the ITAR, a deemed export takes place any time the company releases technology to a foreign national, whether it takes place in the U.S. or abroad. Technology is specific information necessary for the development, production or use of a product. Technology is released for export when it is available to foreign nationals for visual inspection (such as reading technical specifications, plans, blueprints, etc.); when it is exchanged orally; or when it is made available by practice or application under the guidance of persons with knowledge of the technology. The transfer of technology can be accomplished by various means. To ensure that the transfer of technical data does not take place unless the proper compliance checks have been conducted and the appropriate individual validated license (IVL) or license exception is in place, the following guidance is provided: A. Hiring Foreign Nationals Human Resources in conjunction with the Export Compliance Manager will coordinate with the Project Managers to determine if the non-permanent resident requires Astro-Med to submit an IVL request to the Department of Commerce or State prior to the hiring of said individual. If the foreign national can be hired under a license exception, completion of Astro-Med s nondisclosure statement and/or Letter of Assurance would be required. If it is determined that an IVL is required, the Export Compliance Manager will submit an IVL to the Department of Commerce or Department of State. Human Resources will notify the appropriate Manager not to allow the foreign national to commence work on the controlled products at Astro-Med until an IVL has been issued. All Astro-Med employees, including any and all foreign nationals are required to complete the orientation and new hire SOP attached as Appendix. B. U.S. Persons/Foreign Persons The ITAR defines a U.S. Person and a Foreign Person as follows: U.S. Person means a person who is a lawful permanent resident ( green card holder or resident alien ) or who is a protected individual (e.g. refugee). It also means any corporation, business association, partnership, society, trust or any other entity, organization or group that is incorporated to do business in the United States. It also includes any governmental (federal, state, or local) entity. It does not include any Foreign Person. Foreign Person means any natural person who is not a lawful permanent resident (i.e., no green card) or who is not a protected individual. It also means any foreign corporation, business association, partnership, trust, society or any other entity or group that is not incorporated or organized to do business in the United States, as well as international organizations, foreign governments and any agency or subdivision of foreign governments (e.g., diplomatic missions). AM

33 Foreign Persons No Foreign Person will be given access to classified or export controlled technology on any project or program that involves the disclosure of technical data as defined in the ITAR or EAR until that individual's license authority has been approved by DDTC, BIS or Insert Company/Division/Program Name s Export Control & Compliance Office. Insert Company/Division/Program Name employees who have supervisory responsibilities for Foreign Persons must receive an export control/licensing briefing that addresses relevant ITAR and EAR requirements as they pertain to classified and export controlled unclassified information. Foreign Person Training and Introduction to Astro-Med Foreign Persons employed by or assigned to (in an extended visit type arrangement) "Insert Company/Division/Program Name" shall receive a briefing that addresses the following items: C. Plant Visits Prior to release of export controlled unclassified information to a Foreign Person, an export authorization issued by DDTC or BIS needs to be obtained by Insert Company/Division/Program Name. Adherence to Insert Company/Division/Program Name s security rules, policies and procedures and in-plant regulations. Outline of the specific information that has been authorized for release to them. Anyone sponsoring a plant visit, training etc. that will include foreign nationals must notify the Export Compliance Manager prior to the visit. The Export Compliance Manager will complete and maintain a Foreign Visitor Briefing Statement (Attachment F) (), indicating that the appropriate compliance check has been conducted (license exception eligibility and RPL screening was completed). D. VISA Sponsor Letters Astro-Med welcomes all foreign national visitors and encourages international exchange, but must ensure that all appropriate safeguards are in place to protect the security of the Company and the export compliance program prior to issuing any sponsor letters. All sponsor letters should be: Person specific (e.g. name, date of birth, place of birth, and passport number); Site specific (e.g. the office being visited); Date specific (critical- sponsor letters should never be open-ended); Clear about the purpose of the visit. It is important to keep track of foreign national visits, because there are export related issues dealing with access to technical data. All foreign national visitors must sign the visitor s log AM

34 prior to entering a facility. Copies of all sponsor letters MUST be sent to the Export Compliance Manager. Any deviation from either the visa or sponsor letter requires immediate notification to the Export Compliance Manager. E. Transmission of Company Proprietary Technical Data Transmission of Company proprietary technical data internationally is deemed an export and therefore is subject to the Export Laws of the U.S. Prior to distributing such information in any of the modes described below, the compliance review checks are to be conducted by the Export Compliance Manager. Modes of Distribution: Courier of documents Electronic transmission (memo to file by party transmitting information) Mailings Hand carries Compliance Review Checks: Determine license-ability to end destination (license exception vs. validated license) End User check against the latest Restricted Party List (RPL) via Visual Compliance, AMI s third party screening software F. Visiting Foreign Countries The following is the procedure to be implemented for all hand-carries of Astro-Med manufactured products or other Astro-Med property exported from the U.S. The purpose is to provide export procedures and guidelines relative to Export Controls and record-keeping requirements for the hand-carry of U.S. origin commodities or U.S. controlled products internationally; (products, technical data). These procedures and guidelines ensure that all transactions are made in compliance with the EAR and/or ITAR. Astro-Med employees or visitors, wishing to hand-carry for export purposes any commodities or technical data must first notify the Export Compliance Manager. The following information must be provided: Product/Technology to be hand-carried (generic technical description). Value of hand-carry items. Country of origin of commodities. The usage of hand-carried commodities. Date of departure. Name of carrier. Port of export. Destination country Entity or person who will have custody of the product. Will products be returned? When? AM

35 Astro-Med maintains a Technology Control plan that is applicable to all facilities (located in the U.S. and Foreign Jurisdictions) and all employees must adhere to the plan when sponsoring foreign visitors or foreign Nationals visit a plant or when transferring technical data to foreign Nationals. G. Astro-Med will provide Badges to its employees who are required to wear them at all times while on Astro-Med Premises. Foreign Nationals, contractors and visitors will be provided a distinctive badge that will limit access to certain areas of the premises. AM

36 12. TRAINING AND EDUCATION Training of personnel is recognized as an on-going responsibility of Astro-Med, therefore, there will be a continuing program for informing and educating employees in regards to the applicable regulations, limits and restrictions of the Export Administration Regulations and other related U.S. export regulations. The Export Compliance Manager is responsible for identifying and determining the method, type, and frequency of training required for individuals that are involved in international transactions. This will be determined based on changes to the export regulations and/or the policy and procedures within the Company. A. Methods of Training The two methods that will be utilized to train employees are Formal and Informal. Formal Training - Structured meetings with agendas and handouts. A copy of the handouts will be filed in the Internal Training File maintained by the Astro-Med Export Compliance Manager. The Astro-Med Export Compliance Manager will maintain a Training Attendance Log (Attachment B) Informal Training - Day to day verbal and written communication (electronic mail messages or memoranda) with personnel in export related departments. A copy of written communication will be maintained in the office of the Astro-Med Export Compliance Manager B. Training Materials The following sources will be used to keep abreast of the constantly changing export environment: News Alerts, Internet Outside Consultant BIS updates BIS, and other Export Compliance related workshops and seminars C. Types of Training Training will be provided to employees involved in export related departments: Orientation Update Sessions Seminars for those who are involved in exporting D. Orientation The Export Compliance Manager will provide orientation training to new employees involved with export activities. The training will include, but will not be limited to, the following topics: Summary of the organizational structure of export related departments and functions AM

37 Company commitment to export compliance U.S. Export Regulations as they relate to the specific position of the employees Astro-Med s Export Compliance Policy Astro-Med s Export Compliance Manual E. Update Sessions The Export Compliance Manager will provide formal and informal update sessions to meet the specific needs of the individuals and/or operating departments. The purpose of the training will be to reinforce knowledge and to communicate updates and changes to the export regulations and company procedures. The training will include but will not be limited to the following subjects, depending on the audience: Overview of the scope of export controls Review of Product Matrix (commodity restrictions) Review of license types and requirements Review of systems currently in place to ensure compliance Requirements of license exceptions Record keeping requirements Export documentation preparation Export compliance program at Astro-Med F. Outside Seminars From time-to-time, employees dealing in international activities will attend seminars offered by the Department of Commerce, Department of State or private organizations, and industry groups. These seminars are to present awareness of changes in the regulations and to keep the employees current on export related issues. G. Executive Awareness An Executive Awareness Session will be presented to senior management to keep them abreast of relevant export related issues as necessary. AM

38 13. EXPORT DEALERS AND REPRESENTATIVES Astro-Med works with independent resellers (foreign reps and dealers). These entities are required to sign a written form that explains their responsibility and agreement to comply with U.S. law. See Resellers Compliance Agreement Appendix H. AM

39 APPENDIX A - CERTIFICATE OF UNDERSTANDING - ASTRO-MED This certifies that I, have received the Astro-Med s CEO Statement of Regulatory Compliance Commitment. I further understand that it is my responsibility to comply with this statement and the applicable policies/procedures at all times. If a situation arises with the procedures in the export compliance manual where I have questions on how to resolve, I will contact the Export Control Manager for resolution. Signature Date AM

40 APPENDIX B - TRAINING ATTENDANCE LOG ASTRO-MED ECM Date Subject Attendee Presenter Type / / / / / / / / / / / / Orientation Update Seminar Executive Orientation Update Seminar Executive Orientation Update Seminar Executive Orientation Update Seminar Executive Orientation Update Seminar Executive Orientation Update Seminar Executive AM

41 APPENDIX C - EXPORT COMPLIANCE CONTACTS - ASTRO-MED International Sales Group: Name Title Phone Contacts address Eric Menke International Sales Manager X272 [email protected] Elisabeth Miller International Sales Specialist X537 [email protected] Export Compliance Committee: Name Title Phone Contacts address Mathew Cook VP of Human Resources X244 [email protected] Rick Parent Export Compliance Manager X284 [email protected] Michelle Lombardo Financial Reporting and Compliance Manager X260 [email protected] Elisabeth Miller International Sales Specialist X537 [email protected] Product Specialist: Name Title Phone Contacts address David Kortick Product Development Manager X278 [email protected] T&M Recorders AM

42 David Chester Project Coordinator X293 Ruggedized Tony Lima Senior Engineering Manager - QLS X252 [email protected] AM

43 APPENDIX D - ASTRO-MED COUNTRY GROUP D:2 - D:4 & E:1 END USE SCREENING (EPCI) COUNTRY GROUP D - SUPPLEMENT #1 PART 740 OF THE EAR (current through. Review and update to maintain a current list). Country Afghanistan [D:1] National Security [D:2] Nuclear [D:3] Chemical & Biological X [D:4] Missile Technology Armenia X X Azerbaijan X X Bahrain X X Belarus X X Burma X X Cambodia X China (PRC) X X X Cuba X X Egypt X X Georgia X X Iran X X X Iraq X X X X Israel X X X Jordan X X Kazakhstan X X Korea, North X X X X Kuwait X X Kyrgyzstan X X Laos X AM

44 Country [D:1] National Security [D:2] Nuclear [D:3] Chemical & Biological [D:4] Missile Technology Lebanon X X Libya X X X X Macau X X X Moldova X X Mongolia X X Oman X X Pakistan X X X Qatar X X Russia X X Saudi Arabia X X Syria X X Taiwan X Tajikistan X X Turkmenistan X X Ukraine X United Arab Emirates X X Uzbekistan X X Vietnam X X Yemen X X Country Group E 1 [E:1] Country Terrorist supporting countries 2 [E:2] Unilateral embargo Cuba X X AM

45 Iran Country [E:1] Terrorist supporting countries 2 X [E:2] Unilateral embargo Korea, North Sudan Syria X X X AM

46 APPENDIX E - ORDER ENTRY PROCESS NARRATIVE AND DECISION TREE New purchase order or RFQ is received through any channel by inside or outside sales. Salesperson uses know your customer and red flag instructions to determine if the goods being sought are for export or re-export or not. If domestic, sale can proceed as per usual for domestic orders. If for export, the salesperson will determine the country of ultimate destination and make a note of that in the company s record in Salesforce.com Salesperson will consult with Export Compliance Manager on the sale of the controlled commodity (any item not EAR99) to the country of destination. If the sale is cleared, proceed. If the sale is of a commodity or to a country requiring any kind of special attention, the salesperson will turn it over to the Export Compliance Manager for further evaluation and action, including the application for an export license if required. If the Export Compliance Manager determines that the sale cannot proceed, the salesperson will reply to the customer that order cannot be fulfilled. If the order is accepted, before the new customer record is entered into JDE, the new customer will be screened through the E-Compliance program. If any alert is received from the screening, the information will be sent to the Export Compliance Manager for review. If the Export Compliance Manager clears the order after the alert has been analyzed, sale will proceed. If the Export Compliance Manager determines that the alert should block the sale, the order will be stopped and the salesperson will advise the customer. E-compliance screening results are returned to the person performing the screening via an automated feature through E-Compliance and are saved in a designated file/folder on the Astro-Med, Inc. network. When the new customer master is entered by the order entry person, after doing the E- Compliance screening with no alerts received, a Y (not on any denied parties list) code in the box for export screening performed. If an existing customer generates an alert from E-Compliance at any time, the export compliance manager will determine if any special action or procedure such as blocking sales to the customer may be required. If the Export Compliance Manager determines that sales cannot be made to an existing customer, an N (on a denied party list) code will be entered in the customer master in the box for export screening performed. If the Export Compliance Manager determines that future sales must be monitored to an existing customer, an F (flagged; each sale must be reviewed) code will be entered in the customer master in the box for export screening performed. Export sales orders will be entered and processed coded as SX for customers (not Astro- Med companies) with ultimate destination of goods outside of us. Export sales orders to and through overseas Astro-Med companies will be entered and processed coded as SI orders. A statement of ultimate destination for the exported goods will be put on the orders as a text line if it is different from the country in the ship to address. AM

47 Customer masters for foreign customers will be coded to call up the BXA text line as default on the original invoices. If customer master is not coded for BXA message and the order is for export, salesperson writing the order will add BXA in the box for print message so that it will print on the original invoice. If there is any language on an order or a letter of credit or other correspondence in the sales transaction which indicates a request for boycott, the salesperson will alert the Export Compliance Manager. No order will proceed, be entered, processed, shipped or paid for which violates antiboycott regulations. After final review of all compliance issues (commodity, country, customer, anti-boycott language have all been screened), if the order is cleared it will be proceed through fulfillment. E-compliance will alert Astro-Med of any change of status of a customer or country status and any order in process will be blocked from shipping if there is question on compliance AM

48 APPENDIX F - FREIGHT FORWARDERS LETTER OF ENGAGEMENT ADDRESS] [ADDRESS] [ADDRESS] [ADDRESS] Re: Acknowledgement of ASTRO-MED, INC. Export Compliance Policy Dear [Freight Forwarder]: ASTRO-MED, INC. is presenting this compliance letter of engagement to restate and secure your acknowledgment of and commitment to some of the requirements of our business relationship. These requirements are an integral part of the corporate policy of ASTRO-MED, INC., which, as a U.S.-based company, must comply fully with all U.S. laws governing international business activities, including: the U.S. Export Administration Regulations ( EAR ) maintained by the U.S. Department of Commerce; the U.S. International Traffic in Arms Regulations ( ITAR ) maintained by the U.S. Department of State; trade and economic sanctions maintained by the U.S. Treasury Department s Office of Foreign Assets Control ( OFAC ); the Federal Trade Regulations ( FTR ) maintained by the U.S. Department of Commerce, Bureau of the Census; We greatly appreciate [Freight Forwarder] s cooperation regarding compliance with all applicable laws and regulations. While it is [Freight Forwarder] s obligation to ensure its own compliance with the laws and regulations referenced in this letter, it shall also be the ASTRO- MED, INC. s obligation to ensure its own compliance with the laws and regulations referenced in this letter. We are providing information on the U.S. rules as a courtesy to [Freight Forwarder] and to ensure that [Freight Forwarder] is on notice regarding these compliance obligations. Accordingly, we ask that [Freight Forwarder] acknowledge the following: 1. [Freight Forwarder] shall review all export documentation 1 prepared by [ASTRO-MED, INC.] for completeness and accuracy based on the information provided by [ASTRO- MED, INC.} 2. [Freight Forwarder] shall ensure that any Automated Export System ( AES ) submission made on behalf of (ASTRO-MED, INC.) in conjunction with the export transaction involving any ASTRO-MED, INC. commodity, software, technical data or technology is properly completed based on the information provided by ASTRO-MED, INC. and adheres to the applicable filing guidelines established by the EAR, ITAR and FTSR. Such submissions should be presented to the carrier within the time frame required for 1 Export documentation includes: air waybills; bills of lading; commercial invoices; consular invoices; certificates of origin; inspection certificates; dock receipts; warehouse receipts; destination control statements; export licenses; export packing lists; and insurance certificates. AM

49 inspection by U.S. Customs and Border Protection ( CBP ) for the shipments [Freight Forwarder] is handling in behalf of ASTRO-MED, INC.; [Freight Forwarder] shall ensure that the appropriate destination control statement appears on export documentation prepared by [Freight Forwarder] when applicable and required; 1. [Freight Forwarder] shall notify ASTRO-MED, INC. s Export Compliance Manager promptly if any contradiction, inconsistency, incompleteness or inaccuracy regarding ASTRO-MED, INC. s export documentation or instructions is identified and shall place the shipment on hold until the export documentation is perfected. [Freight Forwarder] shall not make any changes to or substitutions for any ASTRO-MED, INC. export documentation OR AES entry data without prior approval from ASTRO-MED, INC. s Export Compliance Manager; 2. [Freight Forwarder] shall return completed copies of the airway bill and proof of AES submission within a reasonable time of export; upon request from Client s NAME; provide us with a copy of the AES entry. 3. [Freight Forwarder] shall comply with all applicable terms of U.S. Government export licenses and authorizations governing any ASTRO-MED, INC. export transaction; 4. [Freight Forwarder] shall indemnify ASTRO-MED, INC. against any costs or penalties assessed against ASTRO-MED, INC. which result directly from [Freight Forwarder] s non-compliance with applicable laws. [Freight Forwarder] will not be liable for any costs or penalties which result solely from the acts or omissions of ASTRO-MED, INC. We appreciate your adherence to these commitments, which are an integral part of ASTRO-MED, INC. s corporate policy. We request that you return to us your signed acknowledgment, and we invite you to contact us if you have any questions concerning this letter, ASTRO-MED, INC. s policies or the laws and regulations referenced in this letter. Yours Sincerely, Acknowledged by: Rick Parent [ASTRO-MED, INC. Export Compliance Manager] [Freight Forwarder Manager s Name] & Title Date [Freight Forwarder Manager s Title] Date AM

50 APPENDIX G - ASTRO-MED PRODUCT MATRIX Product Group Sales Category Description ECCN Sch. B Number T&M Recorders B07 Everest 3A D22 TMX 3A D23 Dash MX 3A D24 TMX-18 3A D28 DAXUS 3A T&M Ruggedized J04 TOUGHWRITER 5 7A J05 TOUGHWRITER 4 7A J06 TOUGHSWITCH EAR J10 MILTOPE TP4840 7A J11 MILTOPE NP4840 7A J12 MILTOPE TP4429 7A QLS K06 KIARO! EAR K16 CQL-4 OPTIONS EAR K20 Bar Code OEM EAR K24 Pronto EAR K07 VIVO Touch EAR K36 KIARO! 200 EAR K38 KIARO! 50 EAR AM

51 APPENDIX H - RESELLERS COMPLIANCE AGREEMENT (Date) (Name of Reseller) Subject: U.S. Re-Export Regulatory Compliance We at (ASTRO-MED, INC.) are pleased to have you as a distributor/reseller of our products. As a business partner of (ASTRO-MED, INC.) we are providing this letter to reiterate to you some of the requirements of our business relationship. These requirements are an integral part of the corporate policy of (ASTRO-MED, INC.) which mandates full compliance with the U.S. Export Administration Regulations, (EAR), and with all other U.S. Government regulations. Your careful attention to complying with these requirements is, therefore, requested and appreciated. Pursuant to the corporate policy of (ASTRO-MED, INC.), under no circumstances will a sale, export or re-export transaction be made contrary to the U.S. Export Administration Regulations, (EAR), and/or all other applicable U.S. export regulations. That is, 1. No sale or resale of U.S. products, are to be made to any individual or entity listed on the U.S. Sanctioned Parties Lists without prior approval from the U.S. Government. This Sanctioned Parties Lists is comprised of the following: the Denied Persons List, the Entities List, and the Specially Designated Nationals List No sale or resale of U.S. products is to be made to any country subject to a U.S. trade sanction (embargo) without prior approval from the U.S. Government and/or (ASTRO- MED, INC.). 3. The end use of U.S. products for direct/indirect use in any nuclear/missile technology, chemical or biological application maybe controlled by U.S. export regulations and should be reviewed by (ASTRO-MED, INC.) prior to any sale. (ASTRO-MED, INC.) requests that our selling partners comply with this established company policy for all sales of (ASTRO-MED, INC. s) products. If you are unfamiliar with a customer or the customer s business practices, we ask that you check the web site listed below to verify that the sale is not made to a party on any of the U.S. Sanctioned Parties Lists. Please be advised that (ASTRO-MED, INC.) performs a 100% check against these lists prior to processing any order. Any order that is in question may be held for additional documentation prior to shipment, and/or may not be accepted. For your reference, below is a brief description of the lists and the website link: 1. U.S. SANCTIONED PARTIES LIST: The U.S. Department of Commerce publishes a compilation of the persons, firms, and entities in the United States and overseas which have or potentially have violated U.S. export regulations. No transactions with any person, firm or entity appearing on these listings can be conducted without prior approval of (ASTRO-MED, INC.). AM

52 Please notify (Astro-Med, Inc.) if any requests are made by any such person, firm or entity. Entity List: This is a list of organizations identified by the U.S. Department of Commerce as engaging in activities related to the proliferation of weapons of mass destruction. If a party appears on this list, please contact (ASTRO-MED, INC.) immediately in order that an application for a license to export to the U.S. Government may be submitted and secured prior to shipment. Denied Persons List: This is a list of firms and individuals whose export privileges have been denied by the U.S. Department of Commerce. You may not participate in any export or reexport transaction with any person or firm appearing on this list. Note that some denied persons are located within the United States. If you believe a person whose export privileges have been denied wants to buy (ASTRO-MED, INC. s) products in order to export or re-export it, you must not make the sale and should report the situation immediately to (ASTRO-MED, INC.). Specially Designated Nationals List: The Department of the Treasury, Office of Foreign Assets Control (OFAC) is responsible for the oversight and publication of a list comprised of individuals and organizations deemed to represent restricted countries or known to be involved in terrorism and narcotics trafficking. Doing business with individual/companies on the SDN is strictly prohibited. 2. SANCTIONS/EMBARGOES The following countries are currently sanctioned for the resale of U.S. products and technology: Cuba - Iran - North Korea - Sudan - Syria Embargoed nations and other nations for which there are export sanctions often change, thus it is important that you monitor the list of embargoed nations for each export shipment. Please notify (U.S. SUPPLIER) if such a transaction should arise, U.S. Government licenses may be eligible for approval in certain circumstances. 3. ENHANCED PROLIFERATION CONTROL INITIATIVE (EPCI) (ASTRO-MED, INC.) commodities, software and technical data may not be used directly or indirectly in the design, development, fabrication or use of nuclear, chemical or biological weapons or missile technology (missiles that are capable of delivering a payload to a range of at least 300 kilometers) to country group {D:2}, {D:3}, or {D:4} without (ASTRO-MED, INC. s) Export Compliance Department authorization. See attached Country Group List for {D:2}, {D:3}, and {D:4}. As noted previously, compliance with these requirements is an integral part of the corporate policy of (ASTRO-MED, INC.). As a business partner of (ASTRO-MED, INC.), your acceptance of the terms outlined above is fundamental to our continuing business relationship. AM

53 If you should have any questions, please do not hesitate to contact me. Respectfully yours, Rick Parent Export Compliance Manager Acknowledge by: {Name, Title, and Date} {Name of Company} AM