Common use of Escalation Procedure Clause in Contracts

Escalation Procedure. With serious deviations from quality requirements the Buyer reserves the right to initiate an escalation procedure with the Supplier. Triggers for initiating an escalation procedure may e.g. be the following: - repeated faulty deliveries despite completed problem solving (8D) - repeated disruptions of Buyer´s production caused by faulty deliveries - repeated/ critical complaints by customers of Buyer, caused by faults of Supplier - field failures and recall actions respectively, by customers of Buyer, caused by faults of Supplier - insufficient complaint management of Supplier - Long-term insufficient adherence to delivery dates or quantities - impending stoppages of Buyer´s production and their customers´ production respectively, caused by faults of Supplier - critical action out of supplier audit not implemented - unsatisfactory project management of supplier - special status of the supplier assigned by the buyer's customer (e.g. controlled shipping level 1-2-3; C category, etc.) 1) The Buyer has implemented a three-stage escalation procedure. By means of a structured escalation procedure with suppliers, a smooth run of production as well as project shall be ensured; arising problems shall be solved sustainably. In the first escalation stage (problem solution by supplier is not successful) the supplier is invited to an interview with the customer, during which the problem is discussed and remedial measures are scheduled. Escalation to stage 2 (outside assistance required for solving of problem at Supplier´s) follows in case result of stage 1 is unsatisfactory. Escalation stage 2 provides for a root cause analysis that may take place on-site at the Supplier´s, or at the Buyer´s facility. This analysis may be performed by the Buyer as a process audit. The action plan agreed is to be executed by the Supplier in the stipulated period. An unsatisfactory result to escalation stage 2 leads to the initiating of stage 3 (Supplier is not suitable) or even to removing the Supplier as a supplier to the buyer and their customers. The Buyer's customer is included in the escalation level 3, if it is a supplier specified by the Buyer’s customer or if there is a risk for the Buyer's customer. In the case where effectiveness evaluation at the respective escalation stages shows positive results, the Supplier shall be notified of the lifting of escalation procedure (de-escalation). The de- escalation procedure shall be dealt with step by step.

Escalation Procedure. With In the event of serious deviations from the quality requirements requirements, the Buyer reserves the right to initiate an escalation procedure proceedings with the Supplier. Triggers Possible triggers for initiating the initiation of an escalation procedure may e.g. be the following: are - repeated faulty deliveries delivery despite completed problem solving solution (8D) - repeated disruptions of Buyer´s production caused by faulty disturbances at the Buyer's premises due to defective deliveries - repeated/ repeated/critical complaints by customers of the Buyer, caused by faults of Supplier - field failures and recall actions respectively, by customers of Buyer, caused by faults of errors at the Supplier - insufficient complaint management of the Supplier - Long-term insufficient adherence to delivery dates imminent production standstill at the Buyer's or quantities - impending stoppages of Buyer´s production and their the Buyer's customers´ production respectively, ' premises caused by faults of at the Supplier - critical action out of measure from a supplier audit not implemented - unsatisfactory project management of supplier - special status of the supplier assigned deficient order processing by the buyerSupplier - loss of OEM approval or the Supplier's customer QMS certificate (e.g. controlled shipping level 1-2-3; C category, etc.) 1ISO 9001 or EN/AS 9100 or ISO/TS 22163) A structured escalation procedure with the Supplier is intended to ensure a smooth production and project flow and to solve or sustainably eliminate any problems that may arise as quickly as possible. The Buyer has implemented a three-stage level escalation procedure. By means of a structured escalation procedure with suppliers, a smooth run of production as well as project shall be ensured; arising problems shall be solved sustainably. In the first escalation stage level (problem solution by supplier is Supplier not successful) ), the supplier Supplier is invited to an interview with a meeting at the customer, during which Buyer's premises where the problem is discussed discussed, and remedial measures are de- fined and scheduled. Escalation ▇▇▇▇▇ ▇ of escalation (external help necessary to stage 2 (outside assistance required for solving of solve the problem at Supplier´sthe Supplier) follows in case escalation level 1 if the result of stage 1 is unsatisfactory. Escalation stage 2 provides for In escalation level 2, a root cause analysis that may take place on-is carried out on site at the Supplier´s, Supplier or at the Buyer´s facilityBuyer. This problem analysis may can be performed carried out by the Buyer as a process audit. The agreed action plan agreed is to be executed by the Supplier in within the stipulated periodspecified time frame. An unsatisfactory result to of escalation stage level 2 leads to the initiating initiation of stage level 3 (Supplier is not suitable) or even to removing the a Supplier as a supplier to the buyer and their customersblock. The Buyer's customer of the Buyer is included in the escalation level 3, if it is a supplier specified Supplier was approved by the Buyer’s customer or if there is a risk for the customer of the Buyer's customer. In If the case where result of the effectiveness evaluation at test in the respective escalation stages shows positive resultslevel is positive, the Supplier shall be is notified of the lifting of the escalation procedure (de-escalation). The de- de-escalation procedure shall be dealt with step by stepis carried out in stages.

Escalation Procedure. With In the event of serious deviations from the quality requirements requirements, the Buyer reserves the right to initiate an escalation procedure proceedings with the Supplier. Triggers Possible triggers for initiating the initiation of an escalation procedure may e.g. be the following: are - repeated faulty deliveries delivery despite completed problem solving solution (8D) - repeated disruptions of Buyer´s production caused by faulty disturbances at the Buyer's premises due to defective deliveries - repeated/ repeated/critical complaints by customers of the Buyer, caused by faults of Supplier - field failures and recall actions respectively, by customers of Buyer, caused by faults of errors at the Supplier - insufficient complaint management of the Supplier - Long-term insufficient adherence to delivery dates imminent production standstill at the Buyer's or quantities - impending stoppages of Buyer´s production and their the Buyer's customers´ production respectively, ' premises caused by faults of at the Supplier - critical action out of measure from a supplier audit not implemented - unsatisfactory project management of supplier - special status of the supplier assigned deficient order processing by the buyerSupplier - loss of OEM approval or the Supplier's customer QMS certificate (e.g. controlled shipping level 1-2-3; C category, etc.) 1ISO 9001 or EN/AS 9100 or ISO/TS 22163) A structured escalation procedure with the Supplier is intended to ensure a smooth production and project flow and to solve or sustainably eliminate any problems that may arise as quickly as possible. The Buyer has implemented a three-stage level escalation procedure. By means of a structured escalation procedure with suppliers, a smooth run of production as well as project shall be ensured; arising problems shall be solved sustainably. In the first escalation stage level (problem solution by supplier is Supplier not successful) ), the supplier Supplier is invited to an interview with a meeting at the customer, during which Buyer's premises where the problem is discussed discussed, and remedial measures are de- fined and scheduled. Escalation Level 2 of escalation (external help necessary to stage 2 (outside assistance required for solving of solve the problem at Supplier´sthe Supplier) follows in case escalation level 1 if the result of stage 1 is unsatisfactory. Escalation stage 2 provides for In escalation level 2, a root cause analysis that may take place on-is carried out on site at the Supplier´s, Supplier or at the Buyer´s facilityBuyer. This problem analysis may can be performed carried out by the Buyer as a process audit. The agreed action plan agreed is to be executed by the Supplier in within the stipulated periodspecified time frame. An unsatisfactory result to of escalation stage level 2 leads to the initiating initiation of stage level 3 (Supplier is not suitable) or even to removing the a Supplier as a supplier to the buyer and their customersblock. The Buyer's customer of the Buyer is included in the escalation level 3, if it is a supplier specified Supplier was approved by the Buyer’s customer or if there is a risk for the customer of the Buyer's customer. In If the case where result of the effectiveness evaluation at test in the respective escalation stages shows positive resultslevel is positive, the Supplier shall be is notified of the lifting of the escalation procedure (de-escalation). The de- de-escalation procedure shall be dealt with step by stepis carried out in stages.

Escalation Procedure. With In the event of serious deviations from the quality requirements the Buyer reserves the right to initiate ini- tiate an escalation procedure with the Supplier. Triggers Possible triggers for initiating an escalation procedure may e.g. be the followingprocess, e.g.: - repeated faulty deliveries despite completed problem solving (8D) - repeated disruptions of Buyer´s production caused by interruptions at the Buyer’s site due to faulty deliveries - repeated/ critical complaints by customers of Buyer, caused by faults of Supplier Sup- plier - field failures and or recall actions respectively, action by customers of the Buyer, caused by faults of the Supplier - insufficient complaint management of Supplier - Long-term insufficient adherence to delivery dates or quantities - impending stoppages of Buyer´s production and their customers´ production respectively, caused by the faults of Supplier - critical action measure resulted out of the supplier audit not implemented - unsatisfactory insufficient project management of supplier the Supplier - special Special status of the supplier Supplier assigned by the buyerBuyer's customer (e.g. controlled shipping level 1-2-3; C category, etc.) 1) The Buyer has implemented a three-stage escalation procedure. By means of Through a structured escalation procedure with suppliersthe Supplier, a smooth run of production as well as project shall be ensured; arising problems shall be solved sustainably. In the first escalation stage (problem solution by supplier is not successful) the supplier is invited to an interview with the customerBuyer, during which the problem is discussed and remedial measures are scheduled. Escalation Stage 2 of the escalation (external help necessary to stage 2 (outside assistance required for solving of solve the problem at Supplier´swith the Supplier) follows in case stage 1 if the result of stage Level 1 is unsatisfactory. Escalation stage 2 provides for a root cause analysis that may take place on-site at the Supplier´s, or at the Buyer´s facility. This analysis may be performed by the Buyer as a process audit. The agreed action plan agreed is to be executed by the Supplier in within the stipulated periodspecified timeframe. An unsatisfactory result to escalation stage 2 leads to the initiating of stage 3 (Supplier is not suitablesuita- ble) or even to removing the a Supplier as a supplier to the buyer and their customersblock. The Buyer's customer is included in the escalation level 3, if it is a supplier Supplier specified by the Buyer’s customer or if there is a risk for the Buyer's customer. In If the case where result of the effectiveness evaluation check at the respective escalation stages shows positive resultslevel is positive, a message is sent to the Supplier shall be notified of informing him that the lifting of escalation procedure (de-escalation)) has been lifted. The de- de-escalation procedure shall be dealt with step by stepprocess is carried out in stages.

Escalation Procedure. With In the event of serious deviations from the quality requirements requirements, the Buyer reserves the right to initiate an escalation procedure with the Supplier. Triggers Possible triggers for initiating an escalation procedure may e.g. be the followingprocess, e.g.: -  repeated faulty deliveries delivery despite completed problem solving (8D) -  repeated disruptions of Buyer´s production interruptions at the Buyer’s site due to faulty deliveries  repeated/critical complaint by the Buyer’s customers, caused by faulty deliveries - repeated/ critical complaints errors of the Supplier  field failures or recall action by customers of the Buyer, caused by faults of Supplier - field failures and recall actions respectively, by customers of Buyer, caused by faults of Supplier - the Sup- plier  insufficient complaint management of Supplier - Long-term insufficient adherence to delivery dates or quantities -  impending stoppages of Buyer´s production and their customers´ production respectivelyrespec- tively, caused by faults of Supplier -  critical action measure resulted out of supplier the Supplier audit not implemented - unsatisfactory  insufficient project management of supplier - the Supplier  special customer status of the supplier assigned by Supplier at the buyer's Buyer’s customer (e.g. controlled shipping level Controlled Shipping Level 1-2-3; C category, C- classification etc.) 1) The Buyer has implemented a three-stage escalation procedure. By means of Through a structured escalation procedure with suppliersthe Supplier, a smooth run of production as well as project shall be ensured; arising problems shall be solved sustainably. In the first escalation stage (problem solution by supplier is Supplier not successful) ), the supplier Supplier is invited to an interview with the customerBuyer, during which the problem is discussed discussed, and remedial measures are scheduled. Escalation Stage 2 of the escalation (external help necessary to stage 2 (outside assistance required for solving of solve the problem at Supplier´swith suppliers) follows in case stage 1 if the result of stage Level 1 is unsatisfactory. Escalation In the escalation stage 2 provides for a 2, the failure root cause analysis that may take needs to be carried out, which takes place on-on site at the Supplier´s, Supplier or at the Buyer´s facilityBuyer’s premises. This problem analysis may can be performed carried out as a Supplier audit by the Buyer as a process auditBuyer. The agreed action plan agreed is to be executed approved by the Supplier in within the stipulated periodspecified timeframe. An unsatisfactory result to of the escalation stage level 2 leads to the initiating introduction of stage level 3 (Supplier supplier is not suitable) or even to removing the a Supplier as a supplier to the buyer and their customersblock. The Buyer's ’s customer is included in the escalation level 3, 3 if it is a supplier Supplier specified by the Buyer’s customer of the Buyer or if there is a risk for the Buyer's customer’s cus- tomer. In If the case where result of the effectiveness evaluation check at the respective escalation stages shows positive resultslevel is positive, a message is sent to the Supplier shall be notified of informing him that the lifting of escalation procedure (de-escalation)) has been lifted. The de- de-escalation procedure shall be dealt with step by stepprocess is carried out in stages.

Escalation Procedure. With serious deviations from quality requirements the Buyer reserves the right to initiate an escalation escala- tion procedure with the Supplier. Triggers for initiating an escalation procedure may e.g. be the following: - repeated faulty deliveries despite completed problem solving (8D) - repeated disruptions of Buyer´s production caused by faulty deliveries - repeated/ critical complaints by customers of Buyer, caused by faults of Supplier Sup- plier - field failures and recall actions respectively, by customers of Buyer, caused by faults of Supplier - insufficient complaint management of Supplier - Long-term insufficient adherence to delivery dates or quantities - impending stoppages stopages of Buyer´s production and their customers´ production respectively, caused by faults of Supplier - critical action out of supplier audit not implemented - unsatisfactory project management of supplier - special Special status of the supplier assigned by the buyer's customer (e.g. controlled con- trolled shipping level 1-2-3; C category, etc.) 1) - Loss of supplier´s QMS ▇▇▇▇▇▇▇▇▇▇▇ (▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ 6.1) The Buyer has implemented a three-stage escalation procedure. By means of a structured escalation procedure with suppliers, a smooth run of production as well as project shall be ensured; arising problems shall be solved sustainably. In the first escalation stage (problem solution by supplier is not successful) the supplier is invited to an interview with the customer, during which the problem is discussed and remedial measures are scheduled. Escalation to stage 2 (outside assistance required for solving of problem at Supplier´s) follows in case result of stage 1 is unsatisfactory. Escalation stage 2 provides for a root cause analysis that may take place on-site at the Supplier´s, or at the Buyer´s facility. This analysis may be performed by the Buyer as a process audit. The action plan agreed is to be executed by the Supplier in the stipulated period. An unsatisfactory result to escalation stage 2 leads to the initiating of stage 3 (Supplier is not suitablesuita- ble) or even to removing the Supplier as a supplier to the buyer and their customers. The Buyer's customer is included in the escalation level 3, if it is a supplier specified by the Buyer’s customer Customer or if there is a risk for the Buyer's customer. In the case where effectiveness evaluation at the respective escalation stages shows show positive resultsre- sults, the Supplier shall be notified of the lifting of escalation procedure (de-escalation). The de- escalation procedure shall be dealt with step by step.

Escalation Procedure. With In the event of serious deviations from the quality requirements requirements, the Buyer reserves the right to initiate an escalation procedure proceedings with the Supplier. Triggers Possible triggers for initiating the initiation of an escalation procedure may e.g. be the following: are - repeated faulty deliveries delivery despite completed problem solving solution (8D) - repeated disruptions of Buyer´s production caused by faulty disturbances at the Buyer's premises due to defective deliveries - repeated/ repeated/critical complaints by customers of the Buyer, caused by faults of Supplier - field failures and recall actions respectively, by customers of Buyer, caused by faults of errors at the Supplier - insufficient complaint management of the Supplier - Long-term insufficient adherence to delivery dates imminent production standstill at the Buyer's or quantities - impending stoppages of Buyer´s production and their the Buyer's customers´ production respectively, ' premises caused by faults of at the Supplier - critical action out of measure from a supplier audit not implemented - unsatisfactory project management of supplier - special status of the supplier assigned deficient order processing by the buyerSupplier - loss of OEM approval or the Supplier's customer QMS certificate (e.g. controlled shipping level 1-2-3; C category, etc.) 1ISO 9001 or EN/AS 9100 or ISO/TS 22163) A structured escalation procedure with the Supplier is intended to ensure a smooth production and project flow and to solve or sustainably eliminate any problems that may arise as quickly as possible. The Buyer has implemented a three-stage level escalation procedure. By means of a structured escalation procedure with suppliers, a smooth run of production as well as project shall be ensured; arising problems shall be solved sustainably. In the first escalation stage level (problem solution by supplier is Supplier not successful) ), the supplier Supplier is invited to an interview with a meeting at the customer, during which Buyer's premises where the problem is discussed discussed, and remedial measures are de- fined and scheduled. Escalation ▇▇▇▇▇ ▇ of escalation (external help necessary to stage 2 (outside assistance required for solving of solve the problem at Supplier´sthe Supplier) follows in case escalation level 1 if the result of stage 1 is unsatisfactory. Escalation stage 2 provides for In escalation level 2, a root cause analysis that may take place on-is carried out on site at the Supplier´s, Supplier or at the Buyer´s facilityBuyer. This problem analysis may can be performed carried out by the Buyer as a process audit. The agreed action plan agreed is to be executed by the Supplier in within the stipulated periodspecified time frame. An unsatisfactory result to of escalation stage level 2 leads to the initiating initiation of stage level 3 (Supplier is not suitable) or even to removing the a Supplier as a supplier to the buyer and their customersblock. The Buyer's customer of the Buyer is included in the escalation level 3, 3 if it is a supplier specified Supplier was approved by the Buyer’s customer or if there is a risk for the customer of the Buyer's customer. In If the case where result of the effectiveness evaluation at test in the respective escalation stages shows positive resultslevel is positive, the Supplier shall be is notified of the lifting of the escalation procedure (de-escalation). The de- de-escalation procedure shall be dealt with step by stepis carried out in stages.

Escalation Procedure. With serious deviations from quality requirements the Buyer reserves the right to initiate an escalation procedure with the Supplier. Triggers for initiating an escalation procedure may e.g. be the following: - repeated faulty deliveries despite completed problem solving (8D) - repeated disruptions of Buyer´s production caused by faulty deliveries - repeated/ critical complaints by customers of Buyer, caused by faults of Supplier - field failures and recall actions respectively, by customers of Buyer, caused by faults of Supplier - insufficient complaint management of Supplier - Long-term insufficient adherence to delivery dates or quantities - impending stoppages of Buyer´s production and their customers´ production respectively, caused by faults of Supplier - critical action out of supplier audit not implemented - unsatisfactory project management of supplier - special status of the supplier assigned by the buyer's customer (e.g. controlled shipping level 1-2-3; C category, etc.) 1) - loss of supplier´s QMS certificate (ISO 9001, ISO/TS 16949 resp. IATF 16949, VDA 6.1) The Buyer has implemented a three-stage escalation procedure. By means of a structured escalation procedure with suppliers, a smooth run of production as well as project shall be ensured; arising problems shall be solved sustainably. In the first escalation stage (problem solution by supplier is not successful) the supplier is invited to an interview with the customer, during which the problem is discussed and remedial measures are scheduled. Escalation to stage 2 (outside assistance required for solving of problem at Supplier´s) follows in case result of stage 1 is unsatisfactory. Escalation stage 2 provides for a root cause analysis that may take place on-site at the Supplier´s, or at the Buyer´s facility. This analysis may be performed by the Buyer as a process audit. The action plan agreed is to be executed by the Supplier in the stipulated period. An unsatisfactory result to escalation stage 2 leads to the initiating of stage 3 (Supplier is not suitable) or even to removing the Supplier as a supplier to the buyer and their customers. The Buyer's customer is included in the escalation level 3, if it is a supplier specified by the Buyer’s customer or if there is a risk for the Buyer's customer. In the case where effectiveness evaluation at the respective escalation stages shows positive results, the Supplier shall be notified of the lifting of escalation procedure (de-escalation). The de- escalation procedure shall be dealt with step by step.

Escalation Procedure. With In the event of serious deviations from quality requirements requirements, the Buyer reserves the right to initiate an escalation procedure with the Supplier. Triggers Possible triggers for initiating an escalation procedure may e.g. be the followingprocess: -  repeated faulty deliveries delivery despite completed problem solving solution (8D) -  repeated production disruptions of Buyer´s production at the Buyer’s premises due to faulty deliveries  repeated/critical complaint by the Buyer’s customers, caused by faulty deliveries - repeated/ critical complaints errors of the Supplier  field failure or recall action by customers of the Buyer, caused by faults defects of the Supplier - field failures and recall actions respectively, by customers  inadequate complaint management on the part of the Supplier  imminent production stoppage at the Buyer’s or the Buyer’s customer's premises, caused by faults defects of the Supplier - insufficient complaint management of Supplier - Long-term insufficient adherence to delivery dates or quantities - impending stoppages of Buyer´s production and their customers´ production respectively, caused by faults of Supplier -  critical action measure resulted out of the supplier audit is not implemented - unsatisfactory  insufficient project management processing of supplier - the Supplier  special customer status of the supplier assigned by Supplier at the buyer's Buyer’s customer (e.g. controlled shipping level Controlled Shipping Level 1-2-3; C category, C- classification etc.) 1) The Buyer has implemented a three-stage escalation procedure. By means of Through a structured escalation procedure with suppliersthe Supplier, a the smooth run of production as well as and project shall flow is to be ensured; arising guaranteed and any problems shall that have arisen are to be solved sustainablyor eliminated in the long term. In the first escalation stage (problem solution by supplier is Supplier not successful) ), the supplier Supplier is invited to an interview with the customerBuyer, during which the problem is discussed discussed, and remedial measures are scheduled. Escalation Stage 2 of escalation (external help necessary to stage 2 (outside assistance required for solving of solve the problem at Supplier´swith suppliers) follows in case result of stage 1 if the result is unsatisfactory. Escalation In escalation stage 2 provides for 2, a failure root cause analysis that may take needs to be carried out, which takes place on-on site at the Supplier´s, supplier or at the Buyer´s facilityBuyer’s premises. This problem analysis may can be performed carried out as a sup- plier audit by the Buyer as a process auditBuyer. The agreed action plan agreed is to be executed approved by the Supplier in the stipulated periodwithin a specified time frame. An unsatisfactory result to of escalation stage level 2 leads to the initiating introduction of stage level 3 (Supplier supplier is not suitablesuit- able) or even to removing the Supplier as a supplier to the buyer and their customersblock. The Buyer's ’s customer is included in the escalation level 3, 3 if it is a supplier specified by the Buyer’s customer of the Buyer or if there is a risk for the Buyer's ’s customer. In If the case where result of the effectiveness evaluation check at the respective escalation stages shows positive resultslevel is positive, a message is sent to the Supplier shall be notified of informing him that the lifting of escalation procedure (de-escalation)) has been lifted. The de- de-escalation procedure shall be dealt with step by stepprocess is carried out in stages.

Escalation Procedure. With serious deviations from quality requirements the Buyer reserves the right to initiate an escalation escala- tion procedure with the Supplier. Triggers for initiating an escalation procedure may e.g. be the following: - repeated faulty deliveries despite completed problem solving (8D) - repeated disruptions of Buyer´s production caused by faulty deliveries - repeated/ critical complaints by customers of Buyer, caused by faults of Supplier - field failures and recall actions respectively, by customers of Buyer, caused by faults of Supplier Sup- plier - insufficient complaint management of Supplier - Long-term insufficient adherence to delivery dates or quantities - impending stoppages stopages of Buyer´s production and their customers´ production respectively, caused by faults of Supplier - critical action out of supplier audit not implemented - unsatisfactory project management order processing of supplier Supplier - special status Loss of the supplier assigned by the buyerOEM approval or supplier's customer QMS certificate (e.g. controlled shipping level 1-2-3; C category, etc.) 1ISO 9001 or EN/AS 9100) The Buyer has implemented a three-stage escalation procedure. By means of a structured escalation procedure with suppliers, a smooth run of production as well as project shall be ensured; arising problems shall be solved sustainably. In the first escalation stage (problem solution by supplier is not successful) the supplier is invited to an interview with the customer, during which the problem is discussed and remedial measures are scheduled. Escalation to stage 2 (outside assistance required for solving of problem at Supplier´s) follows in case result of stage 1 is unsatisfactory. Escalation stage 2 provides for a root cause analysis that may take place on-site at the Supplier´s, or at the Buyer´s facility. This analysis may be performed by the Buyer as a process audit. The action plan agreed is to be executed by the Supplier in the stipulated period. An unsatisfactory result to escalation stage 2 leads to the initiating of stage 3 (Supplier is not suitablesuita- ble) or even to removing the Supplier as a supplier to the buyer and their customers. The Buyer's customer is included in the escalation level 3, if it is a supplier specified by the Buyer’s customer Customer or if there is a risk for the Buyer's customer. In the case where effectiveness evaluation at the respective escalation stages shows show positive resultsre- sults, the Supplier shall be notified of the lifting of escalation procedure (de-escalation). The de- escalation procedure shall be dealt with step by step.

Escalation Procedure. With serious deviations from quality requirements the Buyer reserves the right to initiate an escalation escala- tion procedure with the Supplier. Triggers for initiating an escalation procedure may e.g. be the following: - repeated faulty deliveries despite completed problem solving (8D) - repeated disruptions of Buyer´s production caused by faulty deliveries - repeated/ critical complaints by customers of Buyer, caused by faults of Supplier - field failures and recall actions respectively, by customers of Buyer, caused by faults of Supplier Sup- plier - insufficient complaint management of Supplier - Long-term insufficient adherence to delivery dates or quantities - impending stoppages stopages of Buyer´s production and their customers´ production respectively, caused by faults of Supplier - critical action out of supplier audit not implemented - unsatisfactory project management order processing of supplier Supplier - special status Loss of the supplier assigned by the buyerOEM approval or supplier's customer QMS certificate (e.g. controlled shipping level 1-2-3; C category, etc.) 1ISO 9001 or EN/AS 9100) The Buyer has implemented a three-stage escalation procedure. By means of a structured escalation procedure with suppliers, a smooth run of production as well as project shall be ensured; arising problems shall be solved sustainably. . Escalation Stage 1: In the first escalation stage (problem solution by supplier is not successful) the supplier is invited to an interview with the customer, during which the problem is discussed and remedial measures are scheduled. Escalation Stage 2: Escalation to stage 2 (outside assistance required for solving of problem at Supplier´s) follows in case result of stage 1 is unsatisfactory. Escalation stage 2 provides for a root cause analysis that may take place on-site at the Supplier´s, or at the Buyer´s facility. This analysis may be performed by the Buyer as a process audit. The action plan agreed is to be executed by the Supplier in the stipulated period. Escalation Stage 3: An unsatisfactory result to escalation stage 2 leads to the initiating of stage 3 (Supplier is not suitable) or even to removing the Supplier as a supplier to the buyer and their customers. The Buyer's customer is included in the escalation level 3, if it is a supplier specified by the Buyer’s customer Customer or if there is a risk for the Buyer's customer. In the case where effectiveness evaluation at the respective escalation stages shows show positive results, the Supplier shall be notified of the lifting of escalation procedure (de-escalation). The de- escalation procedure shall be dealt with step by step.