Alpmetal & CO considers the business with suppliers to be confidential and thus the business is considered a business secret. All information and documentation generated in such a business relationship are also confidential. Confidentiality remains even after the end of the business relationship between Alpmetal & CO and the supplier. All requests that Alpmetal & CO transfers to its suppliers must be passed down the hierarchy to its subcontractors and other business partners with whom it cooperates. This obligation is confirmed by the supplier with a Declaration of Confidentiality, which he receives upon request. The dedicated document must be signed and returned by the supplier to Alpmetal & CO.

By issuing an offer or signing a purchase contract, the supplier undertakes to comply with and follow the quality guidelines. Upon receipt of the order or in case of signing the contract, the supplier confirms this obligation by signing the Quality Agreement, which is received when ordering.

The supplier selection process includes the following:

• if necessary, by carrying out a risk assessment in relation to the selected suppliers, their ability to ensure the quality of the purchased products and services and their ability to supply and perform services,
• assessment of the adequacy and quality of purchased products and services (input control, sampling, information from other sources).

The supplier's competences and ability to meet the requirements of Alpmetal & CO are the main guide in the preliminary selection of a supplier. At this stage, potential suppliers are classified according to their ability to meet the requirements.

Supplier quality requirements are also determined by the materials or services the company purchases. Approval methods and criteria shall be established for each product group. Minimum criteria are also set for selecting suppliers. Purchase is only possible if suppliers meet certain criteria.

In the case of the purchase of material or the order of a service that does not significantly affect the quality of Alpmetal & CO's products, the quality criteria are lowered accordingly. The quality guidelines apply to all suppliers, unless otherwise specified or agreed.

Additional criteria for selecting suppliers to be considered, include the following:

• the scope of the supplier's activity in the field of car industry activity,
• supplier's financial stability,
• complexity of purchased products, materials and services,
• ability to meet technology requirements,
• the adequacy of the available resources available to the supplier,
• production capacity,
• ability to manage modifications,
• the ability to plan and ensure business continuity, which means they are prepared for unforeseen events,
• adequacy of logistics processes.

In the event that Alpmetal & CO requests, the supplier must meet the following conditions:

• it must have an organized and maintained archive of technical documentation,
• it must have regular control over suppliers and input materials,
• new materials must be sampled, validated and stored properly,
• it must have prepared technological control documentation and use it in production,
• it must have adequate and verified working equipment,
• it must have at its disposal the measuring instruments necessary to ensure the quality of the product, the measuring instruments must be metrologically controlled,
• must carry out quality control of production process and keep quality records,
• in production it must use an appropriate method of labeling products according to technological procedures,
• at the end of the production process, it must carry out product quality control before dispatch,
• it must ensure that the working environment in which the work process takes place meets the conditions required by the quality of the product.

A supplier who meets the Alpmetal & CO criteria and meets all the conditions becomes an approved supplier and is included in the List of Approved Suppliers.

The supplier's commitment to supply products in accordance with quality requirements must be ensured by implementing a modern and effective quality management system, which includes the principle of "zero non-compliance" in development, production and all other processes. The emphasis should be on preventive methods and not on methods of detecting non-compliance. Alpmetal & CO requires suppliers to establish, implement and certify a quality management system that meets the requirements of ISO 9001 or recommends the IATF 16949 standard. If the supplier does not have the appropriate certificate, it must obtain the consent of Alpmetal & CO. In cases where a client requests an assessment of the quality management system from the supplier Alpmetal & CO, the supplier is obliged to enable such an assessment. The same applies to the judgment of his subcontractors.

The supplier is obliged to properly archive and maintain all received documentation. For this purpose, he must keep a record of the documentation received and a record of all changes. Technical issues must be resolved with the knowledge of Alpmetal & CO. Only Alpmetal & CO may change the technical documentation provided to the supplier in accordance with the prescribed procedure.

The requirements that Alpmetal & CO imposes on its suppliers must be passed on to their suppliers. All producers involved in the production - supply chain must use appropriate quality management systems in their work, as this is the only way to ensure the quality of the final product.

Alpmetal & CO is the legal owner of the special tools, devices and measures given to the supplier for use. Under no circumstances may the supplier use them for the production of products for third parties unless exceptionally approved by Alpmetal & CO.

The supplier's commitment to supply products in accordance with quality requirements must be ensured by implementing a modern and effective quality management system, which includes the principle of "zero non-compliance" in development, production and all other processes. The emphasis should be on preventive methods and not on methods of detecting non-compliance.

Alpmetal & CO can also carry out its own assessment of the quality management system at a potential supplier with prior notice if necessary. Following the assessment, Alpmetal & CO shall take the further measures necessary to eliminate the identified non-compliances. Alpmetal & CO sends the supplier a joint assessment indicating the non-conformities found. The supplier is obliged to prepare a plan of corrective measures and return it to the auditor by the agreed deadline. Alpmetal & CO has the right to check the effectiveness of the corrective measures taken at any time.

Supplier must draw up a project plan in order to win new products at the request of Alpmetal & CO. This should include elements of advance product quality planning (APQP), a timeline, an overview of activities, checkpoints, target dates and a list of responsible persons. The purpose of the plan is to ensure that the product quality requirements are met and that the project is implemented on time.

The supplier must manufacture the FMEA process (PFMEA) for all parts that are subject to regular deliveries by Alpmetal & CO. Where the supplier is also responsible for product design, he must prepare FMEA constructions (DFMEA). The FMEA can be designed for the parts where the same processes, common tools, and the same control plan are used. Parts must be clearly identified in the list.

Key characteristics or properties of product that are closely related to safety, regulatory and product quality aspects are listed or marked on the drawing with symbols. The minimum required process capability for each key characteristic is Cpk > 1.33. achieving the required quality (POKA YOKE, etc.). In all cases, Alpmetal & CO expects to follow the "zero error principle" in all deliveries.

The latest valid version of the AIAG instructions, i.e. the APQP with control plan instructions, should be used as a basis for developing and maintaining the control plan (e.g. prototype, pre-batch, production). Alpmetal & CO reserves the right to approve supplier control plans. The supplier must draw up control plans for all products or product families. Plans for each of them can be used for products with common or identical processes. In product and process controls, the focus should be on prevention rather than fault detection and correction. Particular attention should be paid to determining the input control characteristics. Proposed repairs or modifications to the products defined in the control plan must be submitted to Alpmetal & CO for approval as part of the start of the PPAP or through a subsequent request from the supplier to amend or submit the PPAP. The repaired or remanufactured product must be re-inspected in accordance with the requirements set out in the control plan and properly documented.

The supplier must manage his work process according to the given requirements in order to ensure consistent quality. Therefore, it prepares and maintains technological, control and other necessary documentation for use in individual operations of the production process. Part of this documentation is also checked by Alpmetal & CO through the PPAP process. The supplier is also obliged to use statistical tools to manage the processes by implementing the necessary corrective measures. The supplier is obliged to provide all measuring and testing equipment provided for in the control plan. The results of measurements for each operation separately and on the final product must be recorded by the supplier, and Alpmetal & CO has the right to inspect them. At the request of Alpmetal & CO, the supplier must deliver output control (final control) measurements at each delivery. Documentation must be kept by the supplier for at least ten (10) years for normal and fifteen (15) years for products with safety features. This also applies after the termination of orders.

Prior to shipment, the supplier is obliged to double-check the conformity of the product with the prescribed requirements. This control must be included in the quality documents as a mandatory operation of the production process.

Alpmetal & CO agrees with the supplier on the type of packaging, the method of packaging and the method of marking the packaging units before signing the contract. The agreement reached applies to an individual product.

The supplier must also agree with Alpmetal & CO on the type and method of transporting the products. The agreement is an integral part of the purchase contract - issued order. In doing so, the transport requirements and special features of the products we transport must be taken into account.

Alpmetal & CO orders materials and services with two types of purchase orders:

• one-time purchase order,
• fixed purchase order with delivery plan for several weeks, in case of continuous purchases.

Delivery of ordered quantities is made to the Alpmetal & CO warehouse in accordance with the agreed parity from the purchase contract or order. Within the method of ordering with recalls, delivery times and the method of delivery are obligated for the supplier and do not allow delays or early deliveries. Alpmetal & CO has the right to refuse or store products delivered before the agreed deadline at the supplier's expense.

In the event of a delay in delivery (except in case of force majeure), Alpmetal & CO has the right to:

• demand from the supplier all or part of the supply and charge him for the incurred costs of eliminating the consequences of non-compliant supplies, unless otherwise agreed,
• order products from another manufacturer at the supplier's expense.

In the event of force majeure, Alpmetal & CO and the supplier must agree on new delivery terms. The basis for such an agreement is the supplier's written message to Alpmetal & CO on the impracticability of deliveries within the originally agreed deadline.

Quality planning is essential for its assurance, continuous improvement, prevention of non-compliance and process optimization. PPAP (First Sample Confirmation Process) is a process that allows a supplier to start manufacturing products in a way that avoids any risk and guarantees long-term quality assurance.

Alpmetal & CO requires written evidence from the supplier to perform this verification. Successful completion of the PPAP process and its confirmation by Alpmetal & CO is a condition for the start of regular deliveries. The required PPAP submission level is level 3 defined in the PPAP AIAG Manual, unless otherwise agreed.

The supplier must inform Alpmetal & CO before any change in the product, process or production location. Based on the notification and confirmation of the proposed change by a representative of Alpmetal & CO and after the implementation of the change, the submission of a PPAP is required, unless otherwise specified.

Alpmetal & CO requires that all products it receives from suppliers comply with quality requirements. Any non-compliant product received will therefore be rejected. Alpmetal & CO has the right to charge the supplier for all direct and indirect costs that will result.

Costs arising from additional activities or events occur, for example:

• transport and handling costs,
• sorting costs,
• finishing costs,
• production downtime costs,
• loss of sales costs,
• administrative costs,
• other costs after submission of relevant documents.

In case of non-compliance of the delivered goods, Alpmetal & CO withholds payment, prepares a statement of all incurred costs and issues an invoice to the supplier. In the event of hidden non-conformities on the purchased goods, which are identified only by the client of Alpmetal & CO, Alpmetal & CO has the right to charge the supplier all incurred direct and indirect costs (replacement of products at home and with clients, recall, etc.).

Alpmetal & CO initiates a complaint procedure when it finds a non-conformity of delivery according to the agreed requirements. In such a case, it is sent a complaint report to the supplier.

In case of quality deviations, rejections and criticisms in the material or delivery, the buyer is obliged to inform the supplier. The supplier must take immediate and effective action within 24 hours of receiving the notification of the complaint (open report 8D) to eliminate the causes of the non-compliance and prevent its recurrence. If the supplier does not rectify the derogation immediately, Alpmetal & CO has the right to revoke the derogation itself or with the assistance of a third party. All costs incurred are borne by the supplier. The supplier is also obliged to compensate Alpmetal & CO for any damage incurred. Complaints are dealt with in accordance with procedure 8D, which the supplier must strictly comply with and follow up with appropriate measures.

Alpmetal & CO requires that no changes should be made by the supplier after product approval. This applies to technical requirements, documentation, own procurement sources, technology, process, production location. All of the above can only be changed by the supplier with the prior consent of Alpmetal & CO.

The purpose of supplier evaluation and development is to monitor and encourage suppliers to achieve business excellence and meet all the requirements of Alpmetal & CO. By evaluating deliveries, we constantly monitor the quality of purchased goods and services for the needs of production. The collected data helps to make decisions on the selection and implementation of corrective measures at the supplier. Alpmetal & CO suppliers informed about the level of quality of goods and services.

Alpmetal & CO assesses the risks for an individual supplier that it identifies.

Continuous improvements Alpmetal & CO expects its suppliers to pursue the principles of business excellence and continuous improvement in all areas of business.

If necessary, on the basis of a risk assessment, we require our suppliers of products and services to establish, implement and improve their quality system and, as far as possible, certify in accordance with the requirements of the ISO 9001 standard.

Unless our client specifies otherwise, we gradually demand the following from our suppliers:

• that they comply with the requirements of the ISO 9001 standard based on the findings of the second party audit,
• to be certified by an accredited institution according to the requirements of ISO 9001 (third party audit).
• that suppliers of products for the automotive industry meet the minimum document requirements: Minimum Automotive Quality Management System Requirements for Sub-Tier SuppliersLinkLink

Maintaining competitiveness in global markets forces Alpmetal & CO to lower the prices of its products. In order to remain competitive, both Alpmetal & CO and its suppliers must take a planned approach to reducing costs and consequently purchase prices. Alpmetal & CO will reduce purchase prices through long-term contracts with suppliers, benchmarking and shifting orders to cheaper suppliers. Alpmetal & CO believes that suppliers can develop a process of continuous cost reduction through the efficient and effective implementation of quality improvement programs, simultaneous development and value analysis techniques.

“CONFLICT MINERALS” On July 16, 2010, Congress passed the reform of the Dodd-Frank Wall Street and the Consumer Protection Act (the “Dodd-Frank Act”). On 22 August 2012, the US Securities and Exchange Commission (hereinafter "the SEC") laid down rules requiring companies to submit certain reports to the SEC, namely to submit an annual disclosure on the origin of certain substances identified as minerals "in their products. "Conflict minerals" are currently gold, as well as tin, tantalum and tungsten, are derivatives of caserite, columbite-tantalite and tungsten, respectively. These Conflict minerals are designated as "3TG." This provision of the Dodd-Frank Act is an effort to further humanitarian objective with a view to ending violent conflicts in the Democratic Republic of Congo (hereinafter referred to as "DR Congo") and the neighboring region. This conflict was partly funded by trade in certain minerals known as “Conflict minerals” in the Democratic Republic of Congo and neighboring countries, including Angola, Burundi, the Central African Republic, the Republic of Congo, Rwanda, South Sudan, Tanzania, Uganda and Zambia. Alpmetal & CO requires its suppliers to comply with the above requirements and therefore to conduct a careful review of Conflict minerals, and to disclose the possible use of Conflict minerals in the supply chain originating in the Democratic Republic of the Congo (DRC) and neighboring countries. As a supplier of Alpmetal & CO, you will be required to respond to requests for information requested by Alpmetal & CO regarding the use of Conflict minerals (tin, tungsten, tantalum and gold) in your products, including information on Conflict minerals that are recycled or destroyed. To respond to a request from Alpmetal & CO, you will need to obtain this information from your suppliers down the supply chain. As a consequence of this request, Alpmetal & CO requires the following from suppliers:

• That the supplier is in line with the Dodd-Frank Wall Street reform and the Consumer Protection Act (the “Dodd-Frank Act”). Further information is available at: www.aiag.org
• Fill out the Conflict Minerals form template, which is also available at the following link: Link
• Return the completed form to the Purchase section of Alpmetal & CO.

The supplier must prepare a plan for extraordinary circumstances to meet the Alpmetal & CO requirement in the event of an emergency such as utility disruption, labor shortage, failure of key equipment. When the supplier knows in advance that there will be disruptions in production, the supplier must notify Alpmetal & CO to which he supplies the material (Logistics) and the purchase at least 24 hours before the interruption, if possible. The cause of the problem must be clarified and immediate measures must be taken to ensure the smooth supply of Alpmetal & CO. Production interruptions may include (but are not limited to) natural disasters, political unrest, wars, capacity, quality problems, labor strikes, or other events that prevent the supplier from meeting the required capacity. The supplier must provide the Alpmetal & CO plan with immediate and long-term recovery measures and action to reduce its impact on Alpmetal & CO.

In addition to all applicable laws and regulations that the supplier must comply with, the supplier's obligation is to comply with social responsibility obligations, in particular, but not limited to requirements based on the Universal Declaration of Human Rights (UDHR) issued by the United Nations General Assembly. proclaimed in Paris on 10th of December 1948 and the International Labor Organization (ILO), which proclaimed a convention to respect workers rights, age and working hours, etc. Alpmetal & CO requires its suppliers to sign a Statement of Consent or confirm the Code of Conduct for Suppliers.