Mountain Valley Machine, Inc.

Quality Based Advanced Terms and Conditions
General: As a supplier (vendor in remaining document) to Mountain Valley Machine,
Inc., it is understood that your organization agrees to meet the following stipulations
whenever a Mountain Valley Machine, Inc. Purchase Order is issued.

1) Mountain Valley Machine, Inc. reserves the right of final approval of product,
procedures, processes, and equipment. The vendor’s performance will be monitored
on a regular basis. On-time delivery, product quality and customer service at a
minimum.

2) All special processes required by this PO must be performed by qualified personnel.

3) Our organization reserves the right to review and approve the Vendors Quality
Management System.
Standard QMS Requirements Include:
a.i.1.a.i.1.a. Vendors providing special processing must maintain a system for
validating processes.
a.i.1.a.i.1.b. Mountain Valley Machine, Inc. specified vendors must operate in
accordance with approved specifications and standards as dictated and
controlled by Mountain Valley Machine, Inc..
a.i.1.a.i.1.c. vendors initially approved for use via certifications like (ISO9001,
AS9100, ISO 17025, etc.) must notify our organization of any changes to that
certification.

4) The vendor shall maintain the proper identification and revision status of
specifications, drawings, process requirements, inspection/verification instructions
and other relevant technical data.

5) Our organization reserves the right to approve or specify any designs, tests,
inspection plans, verifications, use of statistical techniques for product acceptance,
and any applicable critical items including key characteristics.

6) Our organization reserves the right to designate requirements for test specimens for
design approval, inspection/verification, investigation or auditing.

7) The vendor is required to:
a.i.1.a.i.1.a. Notify our organization of nonconforming product.
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a.i.1.a.i.1.b. Obtain our organization approval for nonconforming product
disposition.
a.i.1.a.i.1.c. Notify our organization of changes in product and/or process,
changes of suppliers, and changes of manufacturing facility locations and
where required, obtain Mountain Valley Machine, Inc. approval.
a.i.1.a.i.1.d. Flow down to the supply chain the applicable requirements
including Mountain Valley Machine, Inc. requirements.
a.i.1.a.i.1.e. Ensure that persons are aware of:
-Their contribution to product or service conformity
-Their contribution to product safety
-The importance of ethical behavior.

8) The vendor is required to supply product that has a remaining shelf life of at least
75% of original life as of the date of shipment unless otherwise agreed upon by
Mountain Valley Machine, Inc..

9) The vendor is required to retain all documented information associated with the
purchase order for 7 (seven) years or as required by contract. The vendor must
communicate any records are being destroyed or other disposition methods.

10) Right of access by our organization, our Mountain Valley Machine, Inc. and
regulatory authorities to the applicable areas of all facilities, at any level of the supply
chain, involved in the order and to all applicable records.

11) All vendors providing calibration services must be compliant to ISO 17025, ISO
10012, ANSI/NCSL Z540, (or equivalent). All calibration certificates must identify
standards used and must be traceable to NIST (National Institute of Standards
Technology).

12) Seller shall provide a proper bill of lading signed by carrier, or any other legally
applicable documents providing title to the goods to purchaser upon delivery, fully
protecting all parties in case of damages in transit. All cost incurred due to improper
packing will be paid by vendor.

13) Certification of materials and/or process performed must accompany materials/parts
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received. Invoice will be aged for payment based on date certification(s) is received.

14) Any disputes arising out of any contract issued pursuant to the terms and conditions
shall be interpreted in accordance with and governed by the laws of the state of
Utah, USA.

15) Counterfeit Material Avoidance.
a) The vendor’s certification of conformance represents that the shipment does not
contain any ‘suspect’ or ‘known’ counterfeit part, work, or material, and ensures
that parts, material, or work are procured only through original equipment
manufacturers (OEMs)/original component manufacturers (OCMs) or their
franchised distributors or authorized vendor. Any use of other than an authorized
vendor requires Mountain Valley Machine, Inc. written approval prior to
procurement and use, which shall be accompanied by the vendor’s certification
furnished to Mountain Valley Machine, Inc..
a.i) The vendor shall verify the procurement source and associated certifying
documentation.
a.ii)Vendor’s receiving inspection process shall utilize incoming inspection or test
methods, or both, to detect potential counterfeit parts, material, or work.
a.iii) The vendor shall flow this clause in its entirety or equivalent down to all
lower tier subcontracts to prevent the inadvertent use of counterfeit parts,
material, or work. When an authorized vendor is not utilized by the vendor’s
lower tier, the vendor shall provide a copy of the risk assessment and their
written approval with the certification furnished to Mountain Valley Machine,
Inc..

16) Conflict Minerals.
a) Vendor shall provide Mountain Valley Machine, Inc. with a written certification as
to the presence of “Conflict Minerals” contained in or used in the production of
the items purchased by Mountain Valley Machine, Inc. and the country of origin
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of such “Conflict Minerals” as defined by the Dodd-Frank Wall Street Reform and
Consumer Protection Act. “Conflict minerals,” as defined in Section 1502 of the
Dodd-Frank Wall Street Reform and Consumer Protection Act, are:
a.i) columbite-tantalite (Fe, Mn, Mg)(Nb, Ta)2O6-(Fe, Mn)(Ta, Nb)2O6 (coltan) –
tantalum (Ta),
a.ii)cassiterite (SnO2 ) – tin (Sn),
a.iii) wolframite (Fe, Mn)WO4 – tungsten (W),
a.iv) and gold (Au),
or any other derivatives; or any other mineral or its derivatives determined by the
secretary of state to be financing conflict in the Democratic Republic of the Congo or
an adjoining country. Vendor(s) must include a statement of compliance on all
certificates of conformance delivered to Mountain Valley Machine, Inc..

17) DFARS Compliance.
a) Vendor shall provide a certification stating that materials furnished follow: DFARS
qualifying countries (225.872-1) and DFARS “Specialty Metals” (252.225-7008)
unless otherwise specified on the Mountain Valley Machine, Inc. purchase order.

18) RoHS Compliance.
a) When requested on the Mountain Valley Machine, Inc. purchase order, the
supplier shall provide with each delivery a certificate of compliance stating that all
materials supplied are within the limits for hazardous substances as established
by EU Directive 2002/95/EC. Should any material not comply, the concentration
of the hazardous substance shall be reported on a chemical test report. At the
discretion of Mountain Valley Machine, Inc. the material may be rejected and
returned to the supplier if the concentration of the hazardous substance is over
the established limits. Mountain Valley Machine, Inc. also reserves the right to
request a written plan from the supplier detailing the necessary steps required to
bring the material into compliance and the date when compliance will be
established.
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