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COUNTERFEIT PARTS PREVENTION form 18.9

Suppliers to Blue Sky must comply with these basic Quality Clauses

Additional Quality Clauses will be noted on the Purchase Order as required.

Counterfeit Parts Prevention

a) For purposes of this clause, Counterfeit Work consists of those parts delivered under this Contract that are the lowest level of separately identifiable items (e.g., articles, components, goods, and assemblies). “Counterfeit Work” means Work that is or contains items misrepresented as having been designed and/or produced under an approved system or other acceptable method. The term also includes approved Work that has reached a design life limit or has been damaged beyond possible repair, but is altered and misrepresented as acceptable.

(b) SELLER agrees and shall ensure that Counterfeit Work is not delivered to Blue Sky.

(c) SELLER shall only purchase products to be delivered or incorporated as Work to Blue Sky directly from the Original Component Manufacturer (OCM)/Original Equipment Manufacturer (OEM), or through an OCM/OEM authorized distributor chain. Work shall not be acquired from independent distributors or brokers unless approved in advance in writing by Blue Sky.

(d) SELLER shall immediately notify Blue Sky with the pertinent facts if SELLER becomes aware or suspects that it has furnished Counterfeit Work. When requested by Blue Sky, SELLER shall provide OCM/OEM documentation that authenticates traceability of the affected items to the applicable OCM/OEM.

(e) In the event that Work delivered under this Contract constitutes or includes Counterfeit Work, SELLER shall, at its expense, promptly replace such Counterfeit Work with genuine Work conforming to the requirements of this Contract. Notwithstanding any other provision in this Contract, SELLER shall be liable for all costs relating to the removal and replacement of Counterfeit Work, including without limitation Blue Sky’s costs of removing Counterfeit Work, of reinserting replacement Work and of any testing necessitated by the reinstallation of Work after Counterfeit Work has been exchanged. The remedies contained in this paragraph are in addition to any remedies Blue Sky may have at law, equity or under other provisions of this Contract.

SELLER shall establish and maintain a Counterfeit Prevention Program. The purpose of this document shall be to prevent the delivery of counterfeit parts and control parts identified as counterfeit.