Terms & Conditions

KIMCHUK TERMS AND CONDITIONS

All sales of Kimchuk, Incorporated (“Kimchuk” or “us” or “we”) of Services and Goods (sometimes collectively, “Products”) to customers (“Customer” or “you”) are made in accordance with and subject to the following terms and conditions (“Standard Terms and Conditions”), unless otherwise set forth with respect to a particular sale in a record authenticated by Kimchuk.

STANDARD TERMS AND CONDITIONS

1. PRICES

(a) Prices are quoted in U.S. currency unless we agree in an authenticated record to quote in another currency. Prices quoted orally by our authorized sales representatives may be changed at any time without notice. If not previously accepted or if not quoted with an expiration date, any specific quotation in a record authenticated by us shall expire automatically 30 days from the date issued and is subject to change or termination by notice during that period. All prices are subject to adjustment on account of different Customer specifications, quantities, shipment arrangements or other terms and conditions, which are not part of our price quotation, but which have been accepted by us in a record authenticated by us. Prices are exclusive of all excise, ad valorem, sales, use, value added, import and other taxes and customs duties imposed by any federal, state, municipal or other domestic or foreign governmental authority, all of which shall be paid by the Customer. The Customer agrees to indemnify and hold us harmless against and from any and all liabilities for any such taxes, duties and other similar governmental charges. The Customer is responsible for obtaining and providing to us any certificate of exemption or similar document required to exempt any sale from any such tax or duty.

(b) Price Changes - Customer shall retain control over the entire Product, including components, subassemblies and all other data and material. All engineering changes and sourcing changes must be approved by Customer before implementation by Kimchuk. The cost increases or decreases incurred as a result of engineering and sourcing changes will be reviewed and an equitable adjustment shall be made in the price or shipping schedule or both, including costs to Kimchuk for any material that is rendered excess due to the change. Such changes will be implemented only upon agreement of Kimchuk and Customer, and receipt by Kimchuk of Customer’s written request to proceed with the change and/or by purchase order modifications. Obsolete material resulting from Engineering Change Orders (“ECO’s”) will be identified and invoiced within 30 days.

2. TERMS OF PAYMENT - Unless otherwise expressly stated in a record authenticated by us, payment terms are net 30 days from date of invoice or DFARS 252.232-7017 if applicable. Invoices are sent on our next business day following delivery under Section 3 of these Standard Terms and Conditions. Invoices will be accompanied by all relevant shipping documentation. We reserve the right at any time to require full or partial payment in advance, or to revoke any credit previously extended, if, in our judgment, the Customer’s financial condition does not warrant proceeding on the terms specified. Overdue payments shall be subject to finance charges computed at a periodic rate of 1-1/2% per month (18% per year) or the maximum amount allowed under applicable law, if less, from date of delivery. Amounts owed by the Customer with respect to the goods, as to which there is no dispute, shall be paid without set-off for any amounts which the Customer may claim are owed by us and regardless of any other controversies which may exist.

3. DELIVERY

(a) Except as the term FOB (as defined in the Uniform Commercial Code in effect in the State of Connecticut – the “UCC”) may otherwise be modified by other express provisions of these Standard Terms and Conditions or in a record authenticated by us, all sales are FOB our premises in Danbury, Connecticut. Delivery shall be made on a date agreed to by each party in a record authenticated by it. Without in any way limiting the generality of the limitation on warranties and claims contained in these Standard Terms and Conditions, we shall not be liable for any loss or damage to the Customer or any other party resulting from any delay in manufacturing or delivery of ordered goods.

(b) Material Lead Time and Availability – Quoted Lead times to obtain materials (“Lead times”) are subject to change due to the Electronics Industry market volatility. Lead times quoted change on a daily basis from long lead to being in stock. Actual lead time and delivery can be finalized at receipt of purchase order (“ARO”)

based on material availability and potential alternate parts. In the event that inventory is depleted prior to receipt of a purchase order, there is a potential for price increases including excess material. These increases are the responsibility of the Customer.

(c) Products, on which delivery is delayed due to any cause within the Customer's control, may be placed in storage by us at the Customer's risk and for its account. In addition to its obligations to pay for such goods and pay applicable finance charges in accordance with Section 2 of these Standard Terms and Conditions, the Customer shall be liable for all costs and expenses incurred by us including reasonable charges for use of our own warehouse space in holding or storing goods for the Customer in such circumstances or at the Customer's request. Any such delay in delivery will not delay our invoicing for such goods and payment shall remain due in accordance with Section 2 of these Standard Terms and Conditions.

4. SHIPMENT - Unless instructions to the contrary in an authenticated record are supplied by the Customer and accepted by us by authenticated record, the specific carrier and method and route of shipment will be selected by us. For purposes of greater clarity, unless expressly directed otherwise in an authenticated record received from the Customer and accepted by us by authenticated record, we may nevertheless reasonably vary the carrier and method and route of shipment specified in communications received from the Customer. Whether we have selected the route and method of shipment or they have been otherwise determined, we will not assume any liability in connection with shipment nor constitute any carrier as our agent. All shipments will be made at the Customer’s risk. However, at our option, or if requested by the Customer and agreed to in a record authenticated by us, we may insure goods being shipped, but only at the Customer's expense. The Customer shall be responsible for making any and all claims with carriers, insurers, warehousemen and others for misdelivery, nondelivery, loss, damage or delay. Should it be established upon return of any good, that it was damaged because we had not packaged it for shipping in a commercially reasonable manner and the damage is not otherwise covered by insurance, our liability shall be limited to the repair or replacement, as we in our sole discretion determine, of each so damaged good.

5. TITLE AND RISK OF LOSS - Subject to the following section relating to our retained security interest, and subject to our right to stop delivery of goods in transit, title to and risk of loss and damage to goods shall pass to the Customer when delivery occurs under Section 3 of these Standard Terms and Conditions. Notwithstanding the foregoing, if the specific carrier and method and route of shipment have been selected by the Customer in accordance with Section 4 of these Standard Terms and Conditions, risk of loss and damage to goods shall pass to the Customer earlier, as to goods identified to the contract, if the Customer fails to provide reasonable notice to us, by authenticated record, of the carrier that it has nominated, or if thereafter such carrier fails to appear in a timely manner on the date of delivery and take the purchased goods into its charge. Under either of such circumstances, the risk of loss and damage to goods identified to the contract for delivery to the Customer shall pass to the Customer on the date and time that had been established for delivery to occur even though delivery did not occur.

6. MATERIALS

(a) Broker Procurement - Kimchuk does not advocate the use of brokers to supply long lead time or obsolete electronic parts. We have experienced defective, counterfeit and Electrostatic dissipation (“ESD”) damaged parts purchased from independent distributors and brokers, rather than authorized distributors. If the Customer requires such components, then the part will be supplied by the Customer at no charge to Kimchuk. Such action voids the limited warranty in Section 9 and the Customer will be responsible for any and all rework and/or re-tests resulting from the use of those parts.

(b) Customer Furnished Material

(i) When the Customer elects to supply a line item on a turnkey contract, the Customer Furnished material (“CFM”) must be identified and packaged per the manufacturer specifications. Surface mount components must be supplied tape on reel with a leader plus at least 2% attrition. If forming, gold removal or tin mitigation is required, the component must be supplied as specified. If parts are received without these additional processes as applicable, there will be a cost to the Customer contract.

(ii) When CFM is not delivered in time to meet the delivery schedule of the contract, and Kimchuk has brought in all other materials, Customer shall pay for materials as well as work in process while awaiting the Customer supplied shortages.

(i) In some instances, minimum packaging constraints result in material that is in excess of the order quantity. Our quotation details that potential cost at time of quote. The cost of excess material is the
Customer's responsibility. It is possible at receipt of order (ARO), due to inventory changes that the excess inventory cost will change. Kimchuk will make reasonable efforts to mitigate that cost and will advise after material has been kitted for job the actual excess material costs which will require a Purchase Order Change if different from the quoted costs. Kimchuk shall invoice for the full costs thereof, which will be paid by invoice per standard terms.

(ii) Kimchuk will ship the excess material paid for by Customer per purchase order instructions or manage Customer owned excess inventory at Kimchuk for future orders. If such inventory is stored at Kimchuk, we will maintain stock status and utilize excess in any subsequent Customer orders as Customer furnished material (CFM), but may charge a monthly storage and handling fee based on the storage time and volume required. Also, Customer paid inventory will be noted on subsequent Requests For Quotations (RFQ) at zero ($0) cost. Kimchuk may elect to utilize such excess inventory on non-Customer projects resulting in a credit to the Customer.

7. SECURITY INTEREST - We reserve, and the Customer grants to us, a security interest in all Products sold and all proceeds of such Products to secure the full payment and performance by the Customer of its liabilities and obligations to us. The Customer acknowledges that one or more reproductions of any record authenticated by the Customer that makes reference to these Standard Terms and Conditions of Sale may be filed, along with a copy of these Standard Terms and Conditions of Sale and a description of the goods purchased by Customer, with the appropriate authorities as financing statements under the applicable Uniform Commercial Code or, to the extent relevant and permissible, applicable international law. The Customer agrees to execute and deliver such other authenticated records as we may request in order to perfect our security interest.

8. CANCELLATIONS

(a) Customer Cancellations - Atany time after the purchase order is issued but prior to commencement of material procurement, Customer may cancel deliveries of Product, upon written notice to Kimchuk. Orders which have been accepted by us and for which procurement of materials has commenced, may be cancelled only with our prior consent in the form of an authenticated record and upon terms that will fully indemnify us against loss. Customer’s liability related to cancellation shall include Work-In-Process (“WIP”) inclusive of expended labor; material received prior to cancellation; costs associated with acquiring material and for Non-cancelable non-returnable items that are forwarded to Kimchuk from second tier suppliers of material, i.e., re-stocking charges. It is agreed that Kimchuk will provide Customer with a consolidated list of items, complete with costs and lead-time, which are to be considered "at risk" for obsolescence, Non-Cancelable-Non-Returnable (NCNR), and Long Lead items.

(b) Customer Delays - Within ninety (90) days of originally specified delivery date, Customer may request postponement of delivery for up to sixty (60) days beyond originally specified delivery date, upon our approval, with any additional cost absorbed by Customer. Delivery dates cannot be moved within thirty (30) days of originally specified delivery date.

(c) Kimchuk Cancellations - ln the event of any suspension of payment or the institution of any proceedings by or against Customer, whether voluntarily or involuntary, under any bankruptcy or insolvency law, including but not limited to the United States Bankruptcy Code, or the appointment of a receiver or trustee for the property or affairs of Customer or in the event of an assignment for the benefit of creditors of Customer, we shall be entitled, at our option, to cancel forthwith this contract as to all Product for which title has not passed to the Customer, or at any time thereafter, without notice and without incurring any liability to the Customer. Cancellations shall be subject to reasonable cancellation charges which shall take into account expenses already incurred and commitments made by us. If cancellation is not permitted for any reason under applicable law, payment arrangements for our further performance shall be strictly C.O.D. with immediately available funds.

9. FORCE MAJEURE – We shall be excused from the obligations of this agreement to the extent that performance is delayed due to a Force Majeure, defined as: (a) acts of God; (b) flood, fire, earthquake, hurricane, or

explosion; (c) war, invasion, hostilities (whether war is declared or not), terrorist threats or acts, riot or other civil unrest; (d) epidemic, pandemic, or outbreak of disease; (e) actions of civil authorities; (f) national, state, or regional emergency; (g) strikes, labor stoppages or slowdowns or other industrial disturbances; (h) shortage of adequate power or transportation facilities; or (i) any other cause beyond Our reasonable control. Upon occurrence of such a Force Majeure, we, in Our sole judgment, may delay performance until the Force Majeure has ended, or we may cancel the order and this Agreement (in which event all deposits shall be returned and neither party shall have any further liability to the other). Customer’s duty to pay for Products delivered is never suspended.

10. RETURNS - The Customer is required to request a Return Material Authorization (RMA) number prior to returning any Product. Kimchuk will evaluate the return and if there is a manufacturing defect found to be within Kimchuk's limited warranty, the Product will be expedited for repair at no cost to the Customer. If the evaluation determines that the defect is not the result of Kimchuk’s defective workmanship, the cost impact to repair will be passed on to the Customer. If the evaluation determines that there is no defect that falls within Kimchuk's purview for the Product, a $150 handling fee will be passed on to the Customer and the product will be returned as is. Our liability for any manufacturing defect shall be governed and limited by Section 10 of these Standard Terms and Conditions. Should it be established upon return of any Product, that it was damaged because it had not been packaged in a commercially reasonable manner by us for shipping and the damage is not otherwise covered by insurance, our liability shall be limited to the repair or replacement of the good, as we in our sole discretion determine.

11. LIMITED WARRANTY; CLAIMS - If all labor, material and test (in-circuit, burn in and Functional) have been performed on a Product, Kimchuk extends a one year warranty for defective workmanship. For Product that is only in-circuit tested or not tested at all, Kimchuk extends a six month warranty for workmanship. Defective parts are subject to the OEM and distribution guidelines and do not extend beyond 30 days. The foregoing warranty excludes any defects in, or arising from, Customer Furnished Material. the foregoing product warranty is in lieu of all other warranties, express or implied, statutory or otherwise, including without limitation any implied warranties as to quality, fitness for a particular purpose, merchantibility or otherwise. WE EXPRESSLY disclaim any and all implied warranties with respect to any good or service.

All claims for nonconforming or defective goods must be made by authenticated record within the warranty period. Any claim not made within the applicable period shall be deemed waived and released. Our sole responsibility with respect to any such claim, once substantiated, for defective Products, or for any damage or loss to Products if we are found liable therefor, shall be to repair or replace any such Product or component thereof, with the choice of repair or replacement being at our option unless a complete loss is involved and replacement is thus the sole option. In no event, shall we be responsible with respect to any good or service offered by us that is purchased from us, or otherwise supplied by us, for any monetary damage or be liable for any incidental, consequential, statutory, punitive or other damage, including without limitation any claims for lost profits, business interruption, or any and all claims by any and all third parties due to any cause whatsoever, even if we are advised on the possibility of such damages. THIS LIMITATION SHALL APPLY TO ALL CAUSES OF ACTION, WHETHER BASED IN CONTRACT, TORT, WARRANTY, STRICT LIABILITY STATUTE, EQUITY, OR OTHERWISE. This warranty does not apply to any good which has been damaged by accident or which has been misused, abused, neglected or not maintained, or which has been altered or repaired by anyone other than us or our authorized representatives.

THE FOREGOING CONSTITUTES OUR SOLE LIABILITY AND THE CUSTOMER'S SOLE REMEDY WITH RESPECT TO PRODUCTS SOLD BY US. EXCEPT AS EXPRESSLY SET FORTH IN THESE STANDARD TERMS AND CONDITIONS, WE DISCLAIM ALL WARRANTIES, EXPRESS OR IMPLIED, INCLUDING ANY WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE.

12. ASSIGNMENT AND LICENSE - The Customer shall not delegate any duties nor assign or license any rights or claims under any accepted purchase order or other agreement with us without our prior consent by authenticated record. Any such attempted delegation or assignment shall be void.

13. COMPLIANCE WITH LAWS - The Customer shall carry out all transactions between the Customer and us to which these Standard Terms and Conditions are applicable and shall otherwise deal with the Products sold by us to it in conformity with all applicable laws, rules, and regulations. The Customer shall obtain all permits and licenses required in connection with the purchase, sale, shipment or use of any of our Products.

14. GOVERNING LAW – These Standard Terms and Conditions shall be governed by the laws of the State of Connecticut. Any action brought by either party shall be subject to the exclusive jurisdiction of the federal and state courts located in the State of Connecticut. Each party hereby irrevocably agrees to such exclusive jurisdiction and irrevocably waives any claim or defense to such jurisdiction based on lack of personal jurisdiction or improper venue.

15. CONFLICT OF TERMS – These Standard Terms and Conditions are binding upon the parties and no other terms or conditions addressing the subject matter of this Agreement shall have any effect unless agreed to in writing by us.

16. NOTICE AND COMMUNICATIONS IN GENERAL – Unless governed by an overriding record authenticated by us, notices and communications between the Customer and us shall be governed by this provision. Any notice required by these Standard Terms and Conditions must be given in the form of an authenticated record unless otherwise stated. For the purposes of these Standard Terms and Conditions, the term authenticated record shall mean a record which has been authenticated by a symbol or process that has been attached, incorporated, or logically associated with the record, and the symbol or process was executed or adopted, or deemed so executed or adopted in accordance with these Standard Terms and Conditions, by the Customer or us, respectively, with the intent of signing the record, as the equivalent act to the manual penning of an original signature of an authorized representative. The only authenticated records that shall be recognized by the Customer and us shall be confined to: (a) written records signed with the manually penned signature of an authorized representative of the party to be charged; (b) any email sent by us or the Customer to the other and received by the other that satisfies the definition of authenticated record contained in this Section; (c) data transmitted by us or the Customer to a secured website of the other, which is received on such website, but only if the use of such website for such purpose has been authorized by the owner thereof in an authenticated record and only if the transmission otherwise satisfies such definition of an authenticated record with the process of obtaining secured access being viewed as being a process intentionally adopted as equivalent to the manual penning of an original signature of an authorized representative; (d) photocopies of such signed written records or printed emails or data sent to such a secured website, which meet in each instance such definition and, which, in each case, shall be deemed equivalent to the original for all purposes; (e) any records generated from telephonic transmissions to the facsimile telecopier phone number utilized by us, which is (203) 797-8976 or to any facsimile telecopier phone number belonging to the Customer that satisfies the definition of authenticated record contained in this Section. Notices shall be deemed effective only upon actual receipt, unless otherwise provided in these Standard Terms and Conditions. In addition, any change in these Standard Terms and Conditions posted by us on www.Kimchuk.com shall be deemed effective notice to the Customer of such change, as of the day following the change, and shall be binding with respect to all new purchase orders placed on and after that date. Except as otherwise provided in these Standard Terms and Conditions with respect to e-mails from the Customer, or unless we agree otherwise in an authenticated record, in order for an authenticated record to bind either party, it must be delivered by the authenticating party to the other by any commercially recognized means including electronic transmission.

17. SEVERABILITY - If any provision of these Standard Terms and Conditions is held invalid or unenforceable by any court of competent jurisdiction all other provisions of this Agreement will remain in full force and effect. Any provision of these Standard Terms and Conditions held invalid or unenforceable only in part or degree or in a certain context will remain in full force and effect to the extent not held invalid or unenforceable.

MANUFACTURING TERMS AND CONDITIONS

1. TECHNICAL ISSUES - Technical Action Requests (TAR) will be generated for any technical issues during the order process. Responses to TAR’s are expected within one week to insure that the delivery is not delayed. In the event that the project is delayed due to non-timely response by the Customer, Customer shall pay for materials and work in process while awaiting resolution.

2. BAREBOARD DESIGN - Our surface mount quotation assumes Printed Circuit Board (PCB) design is in accordance with IPC-D-2221, IPC-D-2222, and IPC-7351. Surface Mount (SMT) tooling quote is based on receipt of usable Gerber files and ASCII or ODB++ data.

3. TEST CRITERIA –

A) For Boundary Scan and Automatic Cable testing, Kimchuk will build the interface cables with the required mating connectors supplied by the Customer. If the mating connectors are not supplied, the Customer will be requested to supply the applicable manufacturer part numbers. Kimchuk will procure and this additional cost will apply to the contract.

B) For Kimchuk to develop an in-circuit test (Flying Probe or bed-of-nails tester), the following items will be required. If any of these items are not provided by the Customer, additional costs may incur or test coverage could be compromised.

i) Known-Good boards if available. The first assembly from production can be used if board cannot be provided.

ii) Current ASCII CAD data

iii) Electronic Bill of Material (BOM) in Excel, Assembly Drawing and Schematics in searchable PDF format

4. RESTRICTION OF HAZARDOUS SUBSTANCES (ROHS) PROCESSING –

A) If Customer requests that a project be processed as RoHS compliant, the Customer will submit a signed copy of the Kimchuk RoHS Declaration prior to processing the order. The Customer must verify that the alloys and solder specified are compatible for RoHS processing and have defined all reballing and/or tinning requirements. If Customer documentation is incomplete, additional charges will apply to ensure alloy compatibility.

B)Processing RoHS Ball Grid Array (BGA's) with a tin/lead solder paste is not recommended and will not be covered under warranty due to unknown reliability of the solder joint formed by mixing the two alloys with different melting points. This is not usually an issue for most traditional leaded devices where the lead itself is not intended to reflow. It does become an issue for devices where the lead to be soldered to is a solder ball and is intended to reflow as in the case with BGA’s. Many non-RoHS components will not tolerate the additional heat required to melt the RoHS balls properly. The maximum heat the non-RoHS parts will usually tolerate is too low for proper RoHS ball reflow.

5. CONFORMAL COATING AND EPOXIES - Kimchuk does not recommend conformal coating or epoxying any product prior to test. But the Customer may elect to have Kimchuk conformal coat without testing at our facility with the understanding that the Customer will bear any extra cost required for rework. Working through the conformal coating or epoxy on product that is returned because of test failures will be at the Customer’s expense. In some instances after removing conformal coating the product may not meet the quality standard and might be rendered as scrap. The Customer will be charged for time invested and disposition of product will be determined.

6. GOLD REMOVAL AND TIN MITIGATION -Kimchuk will process components requiring gold removal in accordance with J-Std-001 Class 3. Tin mitigation including reballing RoHS BGA’s is only performed as dictated by the Customer documentation specific to a component, the assembly drawing (double coating) or parts list (notes specifically stating tin mitigation required for Item XXX). These processes void the OEM warranty for that component.

7. CONSIGNMENT JOB REQUIREMENTS - When Customer contracts Kimchuk to build product with material solely supplied by the Customer, the Customer must follow the following protocol:

A) An accurate Packing Slip must accompany each kit. All product must be labelled with the correct part number, value and BOM item number. Kimchuk assumes that both the inspection and acceptance of this material has been performed by the Customer.

B) If programmable devices are supplied and Kimchuk was not engaged to program them, they shall be supplied pre-programmed or with instructions to assemble as unprogrammed devices.

C) Pricing is based on receipt of a complete and verified kit. If the kit is supplied with shortages or if Kimchuk discovers that the kit is short after setup, the Customer will be assessed an additional charge for handling and processing of shortages.

The following fee structure shall apply:

i) Shortages shall be charged at the rate of $35/line item short.

ii) If all shortages are fulfilled at one time, the fee shall be reduced to $35 plus $10 per line item.

iii) If substitutes are supplied, the item number substituted must be placed on the item package and shall be used without verification. If the substitute line item is not identified and must be determined, there shall be a $15/ item charge.

iv) If there is an obviously wrong substitute, this error shall count as both a shortage and a substitute charge.

D) If the Customer desires that Kimchuk perform kit verification, a separate quote shall be forwarded to Customer. Any charges accumulated shall be sent to the Customer by email with the request that these charges be added to the purchase order (P.O.).

E)All consigned material shall be supplied in appropriate packaging as follows:

i) All tubed integrated circuits (IC’s) whether dual in line packaging (DIP) or SMT shall be in complete tubes. Partial tubes CANNOT be used and must be re-packaged. Do NOT cut tubes. Excess material shall be returned.

ii) All SMT and axial taped items are to be on a continuous strip with a two-inch leader. (The leader portion does not need to contain components). 0402 and 0201 and 01005 packages must be supplied on reels.

iii) Spares should be provided for the following package types in the percentages noted for each type: 0402, 0603 & 0805 = 6%; SOT23 & MELFs = 5%; 1206,1210,1808,1812, 2010, Tant-A (3216), Tant-B (3528), Tant-C (6032), Tant-D (7257 or 7343) & SMD LEDs = 4%. Components must be provided for shrinkage and if the item has extremely low usage a higher shrinkage quantity is required.

iv) All reels shall be free of damaged or twisted tape. Broken strips require the use of a splice and require additional time and material. A fee of $0.50 per line item shall be assessed for broken strip.

v) All fine pitch components shall be supplied in appropriate packaging i.e., Matrix tray or tubes. Damaged leads are NOT permissible.

vi) All electrostatic discharge (ESD) sensitive devices shall be packaged in appropriate ESD packaging.

vii) All moisture sensitive devices shall be packaged in sealed packages with desiccant and humidity indicator cards as well as baking instructions per J-STD-033.

QUALITY ASSURANCE

1. QUALITY SYSTEMS - Kimchuk maintains the following certifications/registrations:

ISO 9001/AS9100
IPC J-Std-001 Requirements for Soldered Electrical and Electronic Assemblies
IPC-A-610 Acceptability of Electronic Assemblies
IPC/WHMA-A-620 Requirements and Acceptance for Cable and Wire Harness Assemblies

Kimchuk is compliant to FAR clause 52.204-21 Basic Safeguarding of Covered Contractor Information Systems and DFARS clause 252.204-7012 Safeguarding Covered Defense Information and Cyber Incident Reporting.

2. ELECTROSTATIC DISCHARGE (ESD) - Kimchuk maintains an ESD program that is in compliance with the requirements of ANSI/ESD S20.20. If any Customer supplied material received is not packaged utilizing proper ESD bags or other suitable ESD packaging materials, the Customer will be notified and the material may be returned to the Customer.

3. MOISTURE SENSITIVE – Kimchuk maintains a moisture sensitive program that is in compliance with the requirements of J-Std-033. Any Customer supplied material received that is not packaged to meet the manufacturer’s assigned moisture sensitivity level (MSL), or if there is reason to believe that the MSL packaging was compromised or violates recommended packaging practices for MSL parts, the Customer will be notified and Kimchuk reserves the right to charge for any additional labor required to utilize parts.

4. PACKAGING - Kimchuk factors standard packaging requirements as part of the quotation process. If there is any special packaging needed, it must be identified in the Customer documentation, i.e. drawing, bill of material or otherwise specified in the request for quote.

If no special handling or packaging requirements are specified, Kimchuk will apply best commercial practices for packaging of final product to provide reasonable assurance that product is protected from damage.

BUSINESS

1. RECORD RETENTION - Kimchuk’s record retention policy is 7 years. We take exception to any requirements exceeding that timeframe.

2. BUSINESS ETHICS AND CONDUCT - Kimchuk Business Conduct and Ethics Code are built on our core values and highlight the principles that guide our business conduct. Kimchuk commits to our Customers that we will strive to produce Products which meet or exceed all regulatory requirements safely and on time.

The success of our business is dependent on the trust and confidence we earn from our employees and Customers. The Kimchuk group strives to make Kimchuk a special place to work, with an atmosphere of mutual respect and professionalism. We gain credibility by adhering to our commitments, displaying honesty and integrity and reaching company goals solely through honorable conduct.

3. CONFIDENTIAL, PROPRIETARY and ITAR INFORMATION - Integral to Kimchuk’s business success is our protection of confidential company information, as well as nonpublic information entrusted to us by employees, Customers and other business partners. Confidential and proprietary information includes such things as pricing and financial data, Customer names/addresses or nonpublic information about other companies, including current or potential suppliers and vendors. Kimchuk will protect and will not disclose confidential, proprietary or nonpublic information without a valid business purpose and proper authorization. For defense contracts, Kimchuk procedures and practices comply with 22 CFR 120-130 “International Traffic in Arms Regulations (ITAR).

It is expected that the parties will disclose to each other during the term of this Agreement certain information which is confidential or proprietary and which may include new technology or products, trade secrets, processes, programs and technical know-how ("Proprietary Information"). If Proprietary Information is provided orally, the disclosing party shall confirm the proprietary nature of such disclosure in writing seven days following such disclosure. All Proprietary Information owned solely by one party and disclosed to the other party shall remain solely the property of the disclosing party, and its confidentiality shall be maintained and protected by the other party with at least the same degree of care used to protect its own confidential information of a similar nature. Except to the extent permitted under this Agreement, the parties agree not to publish or disclose the other party's Proprietary Information to any third party or to any of their employees not having a need to know. The parties agree not to use the Proprietary Information for any purpose other than carrying out this Agreement.

The parties agree that the following information shall not constitute "Proprietary Information" under this Agreement:

a. information lawfully known to either party before the commencement of this Agreement and not subject to limitations on disclosure;

b. information available from public sources at any time before or after it is disclosed to a party under this Agreement;

c. information obtained from a third party not associated with either party who had not acquired the information directly or indirectly from either Customer or Kimchuk;

d. information independently developed by either Kimchuk or Customer without use of information provided under this Agreement.

4. EQUAL OPPORTUNITY EMPLOYER – Kimchuk, Inc. is an equal opportunity/affirmative action employer and is committed to providing a workplace that is free of discrimination of all types. We encourage diversity and it is our policy to provide equal employment opportunities and to treat applicants and employees without illegal bias. It is our policy that no one at Kimchuk should ever be subject to discrimination on the basis of Race, Gender, Religion, Color, National Origin, Age, Disability, Veterans status, Sexual Orientation, Gender Identity, Gender expression or any other characteristic prohibited by state, local or federal law.

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