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The information contained in this document does not contain “technology” as defined by the General Technology Note in Export Administration Regulations (EAR) Supplement number 2 to Part 744 and is therefore considered as publicly released as defined in Part 734.7(4).

Work Instruction

Procedure Number: WI-02-01-02

Subject: Counterfeit Part Risk Mitigation Plan Revision: B

Issued By: Director of Quality Assurance

Approved By: Signed Original on File Effective: 10-27-14 Q. Quant Date

Issued By: Manager of Product Assurance

Approved By: Signed Original on File Effective: 10-24-14 K. Iversen Date

NOTICE: This document may be one of the select L-3 Electrodynamics’ Quality

Management System documents residing on our website. Please take this consideration accordingly when updating this procedure.

1.0 Purpose The purpose of this work instruction is to document the necessary avoidance, detection, mitigation, and disposition processes to prevent counterfeit parts, especially active and passive electronic components (A/PECs), from entering into our customers’ supply stream, thereby enabling the fulfillment of our customers’ requirements, and continued customer satisfaction. This work instruction establishes and documents counterfeit parts risk mitigation methods to enable:

a. Maximizing the availability of authentic parts b. Procuring parts from reliable sources c. Avoiding / mitigating the risks associated with procuring parts from

independent distributors, subcontractors, and contract manufacturers d. Assuring authenticity and conformance of procured parts e. Controlling parts identified as counterfeit f. Reporting counterfeit parts to other potential users, Government agencies,

and investigative authorities

This procedure was developed and promulgated in support of L-3 Communications Corporate Policy (CP), CP-602 (Counterfeit Parts Risk Mitigation), SAE AS5553 (Counterfeit Electronic Parts; Avoidance, Detection, Mitigation, and Disposition), Federal Aviation Administration (FAA) Advisory Circular AC 21-29 (Detecting and Reporting Suspected Unapproved Parts), and WI-02-01-03 (FAA Requirements Compliance Plan).

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The information contained in this document does not contain “technology” as defined by the General Technology Note in Export Administration Regulations (EAR) Supplement number 2 to Part 744 and is therefore considered as publicly released as defined in Part 734.7(4).

Furthermore, this work instruction complements L-3 EDI’s existing third-party, certified AS9100 Quality Management System procedures as documented in 6008725, specifically in support of L-3 EDI’s QOP-02-01 (Development of Quality Plans) as a methodology to be used to facilitate achieving customer expectations and satisfaction per QOP-03-06 (Customer Satisfaction).

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The information contained in this document does not contain “technology” as defined by the General Technology Note in Export Administration Regulations (EAR) Supplement number 2 to Part 744 and is therefore considered as publicly released as defined in Part 734.7(4).

2.0 Scope While L-3 EDI’s Quality Management System (QMS) procedures serve to satisfy the prevention and detection of counterfeit parts in general, in recent years, the increased levels of effort and sophistication of electronic part counterfeiters has, in particular, plagued the aerospace and defense electronics industry and their contractors, such as L-3 EDI. To counter this elevated risk to L-3 EDI and our customers, this procedure was written to primarily elevate L-3 EDI’s QMS procedures regarding the counterfeit electronic part threat plaguing our industry. This procedure shall be used when procuring A/PECs that are later sold to our customers either as-is or incorporated into an end-item/finished good (a.k.a. Production Part per QOP-06-01 and QOP-06-02), regardless of whether such parts are procured as discrete items, or as integrated into electronic assemblies or equipment from independent distributors, subcontractors, or contract manufactures, respectively. While the primary focus of this procedure is mitigating the risk to acceptable levels in relation to counterfeit A/PECs, this shall not preclude this procedure’s usage and tailoring to manage the risk of counterfeit parts of other commodities from entering into L-3 EDI’s customers’ supply chain. It is beyond the scope of this procedure to cover the guidance and requirements material found in existing industry, military, federal, or regulatory publications; however, this procedure was developed to support and supplement such publications. Consequently, it is incumbent on the reader, as may be appropriate, to perform their due diligence and become adequately versed in the content of the documents cited herein. In addition to the FAA documents cited in 6.0 (Requirements), the following counterfeit part related documents may be of general interest on this subject matter:

AC 20-62 Eligibility, Quality, and Identification of Aeronautical Replacement Parts

Order 8120.2 Production Approval and Certificate Management Procedures

Order 8120.16 Processing Reports of Suspected Unapproved Parts

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The information contained in this document does not contain “technology” as defined by the General Technology Note in Export Administration Regulations (EAR) Supplement number 2 to Part 744 and is therefore considered as publicly released as defined in Part 734.7(4).

3.0 Responsibility and Authority

Design and Development - Pursuant to L-3 EDI’s design and development process as documented in QOP-04-01 (Design Control) and QOP-04-04 (Sustaining Engineering), and especially as documented in WI-04-01-02 (Reliability, Maintainability, and Safety Management Plan Guidelines), WI-04-01-07 (Parts Management Plan), and WI-04-01-08 (Parts Obsolescence Management Program), Components Product Group (CPG) and Systems Product Group (SPG) Design Engineering, supported by SPG Components Engineering are responsible to select A/PECs for the intended application with a primary consideration being given to select A/PECs that have a sufficient product life-cycle remaining in support of production and customer demands.

Post-Design Stage Life-Cycle Management - SPG Reliability and/or Component Engineering are responsible to proactively manage the life-cycle of A/PECs and alert the affected functions within L-3 EDI of potential Diminishing Manufacturing Sources and Material Shortages (DMSMS) issues.

Supplier Approval - The Supplier Quality Manager is responsible to survey suppliers, approve suppliers, and to monitor their performance, especially, in the context of this procedure, electronics independent distributors, electronics assembly/equipment subcontractors and contract manufacturers who procure their own A/PEC’s, and electronic component test service providers, in accordance with this procedure and QOP-06-01 (Supplier Selection, Approval and Monitoring).

Purchase Order Counterfeit Part Flow-Down Requirements - The applicable product line or program Quality Assurance Engineers as documented in WI-09-01-05 (Procedure for Part Maintenance in Visual) are responsible to specify for flow-down the applicable counterfeit-part-related quality requirements to suppliers of L-3 EDI’s Production Parts.

Procurement - The Product Group Manufacturing Managers and their Buyers are responsible for procuring items or services. Especially in the context of this procedure, procurements from electronics independent distributors, electronics assembly/equipment subcontractors and contract manufacturers who procure their own A/PEC’s, and electronic component test service providers, shall be in accordance with this procedure and QOP-06-02 (Purchase Order Generation). The Manufacturing Managers are responsible for: a. Ensuring that other options are deemed unfeasible before making

purchases on the independent market. b. Ensuring that all purchases on the independent market are placed with

L-3 approved Independent Distributors. c. Reviewing and concurring with division purchases from independent

distributors.

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The information contained in this document does not contain “technology” as defined by the General Technology Note in Export Administration Regulations (EAR) Supplement number 2 to Part 744 and is therefore considered as publicly released as defined in Part 734.7(4).

Quality – The Vice President of Quality is responsible for: a. Conducting independent quality audits that assess compliance with

this policy as part of the division’s quality system. b. Providing support of Material Review Board actions and related

activities that ensure the identification, segregation, and disposition of counterfeit parts.

c. Reviewing and concurring with division purchases from independent distributors.

The Quality Assurance Engineers (QAEs) are primarily responsible for the generation of Inspection and Test Procedures as specified in WI-10-01-11 (Inspection Procedures) and QA-182 (Test Procedure Document, Generation, Release and Management), respectively. As such, the QAEs shall initiate these documents in such a manner that will maximize the potential for detecting counterfeit parts and thereby minimizing the potential risk of counterfeit parts from entering our customers’ supply chain.

Inspection and Test - Inspection and Test personnel are responsible to initiate and execute the necessary inspection and test procedures to prevent A/PEC counterfeit parts from entering into L-3 EDI’s customers’ supply stream. Specifically in the context of this procedure, this includes A/PEC’s and assemblies containing A/PEC’s procured from electronics independent distributors, electronics assembly/equipment subcontractors, and contract manufacturers who procure their own A/PEC’s in accordance with this procedure and QOP-10-01 (Inspection and Testing). The responsibility for detecting suspect parts/counterfeit parts and preventing them from entering our customers’ supply chain primarily lies with Receiving Inspection, and secondarily with manufacturing inspection and test personnel.

Counterfeit Part Subject Matter Expert (CP SME) - See 6.3.

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The information contained in this document does not contain “technology” as defined by the General Technology Note in Export Administration Regulations (EAR) Supplement number 2 to Part 744 and is therefore considered as publicly released as defined in Part 734.7(4).

4.0 Referenced Documents The following documents are directly associated with the application of this work instruction . They form a part of this document to the extent specified herein, or provide relevant information. For dated references or those identified with a specific revison, only the edition cited applies. For un-dated references, the latest edition of the document, including any amendments, applies unless otherwise specified by contract, purchase order, or other authorizing document. The requirements of this document are intended to supplement the requirements of L-3 EDI’s AS9100 Quality Manual, 6008725. They are not intended to stand alone, supersede, or cancel requirements found in other L-3 Communications Corporate, or L-3 EDI subordinant procedures, such as Quallity Operating Procedures (QOPs) or Work Instructions (WIs), or requirements imposed by contracting authorities, or applicable laws and regulations, unless an authorized exemption/variance has been obtained.

4.1 Government and Regulatory

4.1.1 Federal Aviation Administration (FAA) AC 00-58 Voluntary Disclosure Reporting Program AC 20-62 Eligibility, Quality, and Identification of Aeronautical Replacement Parts AC 21-29 Detecting and Reporting Suspected Unapproved Parts Form 8120-11 Suspect Unapproved Parts Report

Order 8120.2 Production Approval and Certificate Management Procedures

4.1.2 Military Standards MIL-STD-202 Test Method Standard for Electronic and Electrical Component Parts MIL-STD-750 Test Method Standard for Semiconductor Devices MIL-STD-883 Test Method Standard for Microcircuits MIL-STD-1580 Destructive Physical Analysis for Electronic, Electromagnetic, and

Electromechanical Parts

4.2 Industry

4.2.1 IDEA IDEA–STD-1010 Acceptability of Electronic Components Distributed in the Open Market

4.2.2 JEDEC JESD22-B107 Marking Permanency JESD31 General Requirements for Distributors of Commercial and Military

Semiconductor Devices

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The information contained in this document does not contain “technology” as defined by the General Technology Note in Export Administration Regulations (EAR) Supplement number 2 to Part 744 and is therefore considered as publicly released as defined in Part 734.7(4).

4.2.3 SAE AS5553 Counterfeit Electronic Parts; Avoidance, Detection, Mitigation, and

Disposition (Adopted by the Department of Defense [DoD])

AS9100 Quality Systems - Aerospace - Model for Quality Assurance in Design, Development, Production, Installation and Servicing

AS9120 Quality Management Systems - Aerospace Requirements for Stockist Distributors

4.3 L-3 Communications

4.3.1 L-3 Communications Corporate Form R & C Annual Supplier Representations and Certifications Fo-000254 L-3 Supplier Questionnaire Fo-000255 Standard Supplier On-Site Survey Form Fo-000260 Counterfeit Mitigation Assurance Form CP-602 Policy (CP) - Counterfeit Part Risk Mitigation None Critical Supplier Financial Risk Assessment None Supplier Capabilities & Risk Assessment Policy No. 703 Hiring or Using Debarred or Suspended Individuals or Entities

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4.3.2 L-3 EDI Form 0208 Counterfeit Risk Mitigation Procurement Plan (CRiMPP) Form 1002 Supplier Quality Assurance Requirements (SQARs) QA-027 Inspection History Folder Description Use and Execution QA-064 Workmanship Elements QA-182 Test Procedure Document, Generation, Release and Management QOP-02-01 Development of Quality Plans QOP-03-01 Contract Review - Components Products Group QOP-03-02 Contract Review - Systems Products Group QOP-03-06 Customer Satisfaction QOP-04-01 Design Control QOP-04-04 Sustaining Engineering QOP-06-01 Supplier Selection, Approval and Monitoring QOP-06-02 Purchase Order Generation QOP-08-01 Product Identification and Traceability QOP-09-01 Process Control QOP-09-04 Work Environment QOP-10-01 Inspection and Testing QOP-13-01 Control of Nonconforming Product QOP-14-01 Corrective and Preventive Action QOP-15-01 Handling, Storage, Packaging, Preservation, and Delivery QOP-16-01 Control of Quality Records QOP-17-01 Internal Quality Audits QOP-18-01 Training QOP-19-01 Warranty TC-02-001 WI-02-01-02 Counterfeit Parts Training Course WI-02-01-03 Federal Aviation Administration Requirements Compliance Plan WI-04-01-02 Reliability, Maintainability, and Safety Management Plan Guidelines WI-04-01-07 Parts Management Plan WI-04-01-08 Parts Obsolescence Management Program WI-06-01-01 Supplier Performance Assessment WI-06-01-02 Supplier Approval and Maintenance WI-06-02-02 SQAR Application Guidelines WI-06-02-03 Creating Purchase Requisitions and Purchase Orders in ERP WI-09-01-05 Procedure for Part Maintenance in Visual WI-10-01-11 Inspection Procedures 6008725 Quality Manual

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The information contained in this document does not contain “technology” as defined by the General Technology Note in Export Administration Regulations (EAR) Supplement number 2 to Part 744 and is therefore considered as publicly released as defined in Part 734.7(4).

5.0 Definitions and Acronyms

• Aerospace Industries Association (AIA) – AIA is a trade association representing major U.S. aerospace and defense manufacturers and suppliers of civil, military, and business aircraft, helicopters, unmanned aircraft systems, space systems, aircraft engines, missiles, material and related components, equipment, services, and information technology.

• Approved Parts – In the context related to the FAA, see FAA AC 21-29 (Detecting and Reporting Suspected Unapproved Parts) for its definition.

• A/PEC – Active or Passive Electronic Component

• Active Electronic Component A component that relies on a source of energy and is able to

inject power into a circuit. This includes amplifying components such as transistors, triode

vacuum tubes, diodes, and integrated circuits. Other components that typically fall in this

category are Integrated Circuits (ICs). (Note: Electronic components incapable of controlling electron flow are called Passive Electronic Components.)

• Aftermarket Manufacturer: An authorized producer of replacement parts. Parts may be manufactured through an agreement with the OCM to use their tooling, die, and/or intellectual property, or may be reverse engineered, redesigned, or emulated without violating the OCM intellectual property. The aftermarket manufacturer must label or otherwise identify its parts to assure that the “as shipped” aftermarket manufactured part is not mistaken for the part made by the OCM.

• Authorized Distributor - A distributor, reseller or aftermarket supplier who is franchised or authorized by the Original Component Manufacturer (OCM) or Original Equipment Manufacturer (OEM) via contractual bond between the OCM/OEM and the distributor to buy, stock, repackage, sell and distribute its product lines. Franchised distributors normally offer the product for sale with full manufacturer’s warranty. Franchising contracts may include clauses that provide for the OCM’s marketing and technical support, failure analysis and corrective action, and exclusivity of inventory. In contrast to an Independent Distributor, an Authorized Distributor typically receives the product for resale directly from the OCM/OEM. An Authorized Distributor is also known as a Franchised Distributor.

• Broker - See Independent Distributor.

• Commercial and Government Entity (CAGE) Code - A CAGE Code is a five (5) position code that identifies companies doing or wishing to do business with the Federal Government.

• Counterfeit Part (CP) - A part that either is (a) an illegal or unauthorized copy or substitute of an OEM item; (b) an item that does not contain the proper external or internal materials or components required by the OEM or that is not constructed in accordance with OEM specification; (c) an item or component thereof that is used, refurbished or reclaimed but the Seller represents as being a new item; (d) an item that has not successfully passed all OEM required testing, verification, screening and quality control but that Seller represents as having met or passed such requirements; or (e) an item with a label or other marking intended, or reasonably likely, to mislead a reasonable person into believing a non-OEM item is a genuine OEM item when it is not. Parts that have been modified pursuant to a specific

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L-3 purchase order requirement, such as refinished, up-screened, or up-rated parts that are properly identified as such are not considered suspect or counterfeit.

Parts that are not generally considered counterfeit are those whose characteristics or specifications have been modified, but not knowingly misrepresented, such as refinished, up-screened, or up-rated parts.

NOTE

It is a recommended practice to NOT use the term "counterfeit" by itself unless the OCM/OEM of the A/PEC states that they have determined the product is counterfeit in writing. Instead condition the term "counterfeit" with the word "suspect", meaning that based on the expertise that resides within L-3 EDI and/or with 3

rd party evaluators, it is

suspected that the part may indeed be counterfeit. (See “Suspect Part”).

• Counterfeit Part Subject Matter Expert (CP SME) - See 6.3.

• DMSMS - Diminishing Manufacturing Sources and Material Shortages.

• Electronic Reseller Association International (ERAI) - ERAI is an international trade association/service organization that maintains a global database of counterfeit and substandard parts. This service organization also works with distributors and their customer community to educate and implement processes to prevent counterfeit practices. ERAI performs the following duties:

monitors, investigates, reports and mediates issues affecting the global supply chain,

unites OCMs/OEMs, contract manufacturers (CMs), distributors (mostly non-franchised to date), government and other industry associations,

provides risk mitigation on substandard and counterfeit parts, suppliers and customers,

screens Bills of Materials (BOM) for counterfeit and/or substandard parts, and screens distributors for any counterfeit delivery issues.

For further information, the ERAI website is located at the following web address: http://www.erai.com.

• Electronic Component - An Electronic Component is a basic electronic element usually packaged in a discrete form with two or more connecting leads or metallic pads. Components are intended to be connected together, usually by soldering to a printed circuit board, to create an electronic circuit with a particular function (for example an amplifier, radio receiver, or oscillator). Components may be packaged singly (resistor, capacitor, transistor, diode etc.) or in more or less complex groups as integrated circuits (operational amplifier, resistor array, logic gate etc.).

Electronic components are typically sub-typed as either an Active Electronic Component or a Passive Electronic Component.

• Franchised Distributor – See Authorized Distributor.

• Government-Industry Data Exchange Program (GIDEP) - GIDEP is a cooperative activity between government and industry participants seeking to reduce or eliminate expenditures of

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resources by sharing technical information essential during research, design, development, production and operational phases of the life cycle of systems, facilities and equipment.

• Independent Distributors of Electronics Association (IDEA) - The IDEA is a non-profit trade association representing quality and ethically oriented independent distributors of electronic components. The purpose of IDEA is to promote the independent distribution industry through a media advocacy campaign, to improve the quality of products and services through a quality certification program, educational seminars, and conferences, and to promote the study, development, and implementation of techniques and methods designed to improve the business of independent distributors.

• Independent Distributor – In contrast to an Authorized Distributor (a.k.a., a Franchised Distributor), an Independent Distributor (a.k.a. Broker) is a distributor that does not typically have limiting contractual agreements or obligations with OCMs/OEMs. Independent

Distributors purchase parts with the intention to resell them. Independent Distributors may be

franchised for selected, but not all, product lines. For purposes of counterfeit risk mitigation, a

distributor is considered independent when not franchised for the item to be procured.

Independent distributors generally operate as follows:

• Purchase excess inventories from end users with the intention to sell and redistribute back into the market. End users are typically OCMs/OEMs, contract manufacturers or other independent distributors at locations all over the world, and

• Subsequently sell (re-distribute) the parts from these excess inventories to fulfill inventory shortages of hard-to-find, obsolete, and competitively-priced parts.

• Original Component Manufacturer (OCM) – For purposes of the context as described herein, the electronic business entity that originally designed and/or engineered the A/PEC, or its succeeding business entity in the case where the original entity was purchased. The electronic business entity is also pursuing, or has obtained the intellectual property rights to the particular A/PEC. Dependent upon the part type, the OCM name, logo, or CAGE code, or other distinguishing feature is typically observable on the A/PEC. Sometimes as a misnomer an OCM may be referred to as an OEM or Original Equipment Manufacturer, which is typically synonymous with OCM.

• Original Equipment Manufacturer (OEM) –. For purposes of the context as described herein, see Original Component Manufacturer (OCM).

• Passive Electronic Component (a.k.a. Passive Electronic Device or Passive Device) – A Passive Electronic Component is any type of Electronic Component that does NOT have the ability to control electron flow (e.g., via gain or directionality). A passive component cannot introduce net energy into the circuit it is connected to. They are unable to amplify (increase the power of a signal), although they may increase a voltage or current such as is done by a transformer or resonant circuit. Among passive components are two-terminal components such as resistors, capacitors, inductors, and transformers. Resistors, capacitors, inductors, and transformers are all considered Passive Electronic Components. (Note: Electronic Components capable of controlling electron flow are called Active Electronic Components.)

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The information contained in this document does not contain “technology” as defined by the General Technology Note in Export Administration Regulations (EAR) Supplement number 2 to Part 744 and is therefore considered as publicly released as defined in Part 734.7(4).

• Production Item – Raw materials, discrete parts (a.k.a. piece parts), assemblies (i.e., sub-assemblies and final assemblies), or finished goods/product that is included in an end item, in whole or in part (regardless of the form/state in which that it was originally procured in comparison to which it is sold in), which is sold to a customer. This includes such items as: plastic or metal stock material, adhesives, paint thinner, thread locking compound, adhesion promoting solutions (the type not washed away), welding rods, solder, flux, printed wiring boards (PWB), PWB/circuit board assemblies, conformal coating, screws, castings, electronic components, labels, etc. This typically excludes such items as manufacturing/shop supplies: cleaners, gloves, stirring sticks, etc.

• Substandard Part – Reclaimed scrapped components and materials. May actually be the part ordered that has been previously used and installed in other equipment misrepresented by the supplier as new.

• Suspect Counterfeit Part (SP) – A part in which there is an indication by visual inspection, testing, or other information that it may not conform to legal, established government or industry-accepted specifications or national consensus standards, or one who’s documentation, appearance, performance, material, or other characteristics, in part or collectively in whole, may have been misrepresented by the supplier ormanufacturer and may meet the definition of a counterfeit part.

For the purpose of this procedure, this also includes the FAA’s term Suspect Unapproved

Part (SUP).

• Suspect Unapproved Part (SUP) – In the context related to the FAA, see FAA AC 21-29 (Detecting and Reporting Suspected Unapproved Parts) for its definition.

• Unapproved Part – In the context related to the FAA, see FAA AC 21-29 (Detecting and Reporting Suspected Unapproved Parts) for its definition.

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6.0 Requirements

6.1 General The requirements below shall compliment and support L-3 EDI’s existing third-party certified AS9100, bid and proposal, design and development, procurement, inventory management, production, nonconforming material control, and sustainment documented processes.

The most effective approach to mitigate the risks associated with counterfeit parts is to implement and execute proactive methodologies such as appropriate avoidance, detection, mitigation, and disposition methodologies as those specified below.

6.2 L-3 Communications Corporate Counterfeit Parts Policy and Webpage To facilitate L-3 Communications divisions to deploy adequate counterfeit part risk-mitigation policies and procedures, L-3 Communications Corporate has:

• Developed CP-602 (Counterfeit Parts Risk Mitigation), that is mandatory compliance for all L-3 Communications divisions,

• Created the Counterfeit Parts Team consisting of subject matter experts (SME’s) from

various L-3 Communications divisions, and • Developed an L-3 Communications Intranet Counterfeit Parts Website consisting of useful

and timely information regarding counterfeit parts, such as:

­ A list of independent distributors that have been reviewed and approved by L-3 Communications based upon surveys, audits and/or historical data. This list contains critical information on each distributor that includes contact information, certifications, survey status, risk mitigation processes, test facilities used for part authenticity, test facility capabilities, etc. (Please note that use of these distributors does not guarantee pristine parts; precautions and authenticity tests and inspections listed in this procedure must still be followed).

­ Presentations and industry information on the counterfeit problem.

­ Lessons learned from counterfeit experiences across L-3 Communications

divisions.

­ Inspection and test risk mitigation methods and procedures.

­ Counterfeit Parts Prevention Model that illustrates L-3 Communications procurement flow and risk-mitigation flow to prevent counterfeit parts.

­ Contact information for L-3 Communications SME’s on counterfeit and

substandard parts.

The L-3 Communications Intranet Counterfeit Parts Website may be accessed from the Material Management or Quality Management homepages. Since counterfeit parts are an ever-growing industry and L-3 Communications concern, this website is updated frequently to try to stay a step

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ahead on this issue. Therefore, it is recommended that this website be saved to one’s Microsoft®

Internet Explorer Favorites and periodically checked for updates and developments.

6.3 L-3 Counterfeit Part (CP) Mitigation Subject Matter Expert / Point of Contact L-3 shall have a designated counterfeit parts subject matter expert / point of contact. The primary responsibilities of the L-3 Counterfeit Part Subject Matter Expert / Point of Contact shall be to:

• ensure division compliance with this policy, • coordinate the division’s interaction with ERAI and GIDEP, • serve as a member of the L-3 Counterfeit Parts Interdivisional Team, • report confirmed counterfeit parts to the VP, Quality via Counterfeit Part Incident Reports

and providing ongoing updates through closure, • maintain currency on the FAA’s Suspect Unapproved Parts (SUP) Program, its related

procedures, and Unapproved Parts Notifications (UPN’s); maintain currency on CP-related matters in industry;

• provide information to L-3 EDI’s management and affected process owners and stakeholders regarding current /emerging CP matters;

• facilitate the development and execution of L-3 EDI’s risk mitigation strategies, especially pursuant to new and/or emerging CP threats;

• establish the necessary CP-related training materials and/or courses; • maintain a centralized repository of CP-related documents for reference purposes, and • ensure adequate CP training of process owners and stakeholders.

Currency in industry CP matters may be maintained via such actions as:

• Reviewing current CP articles and presentations from such sources as other prime defense contractors, quality and/or reliability trade publications, government investigative authorities, law enforcement, statutory and regulatory (e.g., the FAA) agencies; L-3 Communications Intranet Counterfeit Parts Website, etc.

• Actively participating in the L-3 Communications Counterfeit Parts Team and other

industry or customer CP forums, and

• Having membership in and/or periodically reviewing pertinent information and notifications published by IDEA, ERAI, GIDEP, AIA, FAA, etc.

6.4 Bid and Proposal Process During L-3 EDI’s bid and proposal development process as documented in QOP-03-01 (Contract Review - Components Products Group) and QOP-03-02 (Contract Review - Systems Products Group), adequate consideration by the responsible parties as specified herein should be given and incorporated into L-3 EDI’s bid or proposal, as may be applicable.

6.5 Part Selection and Part Availability Management L-3 EDI shall proactively select A/PECs and manage their Diminishing Manufacturing Sources and Material Shortages (DMSMS) in accordance with WI-04-01-07 (Parts Management Plan), and WI-04-01-08 (Parts Obsolescence Management Program) during all phases of L-3 EDI’s product life cycle, as applicable, including, but not limited to:

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a. Design and Development b. Production c. Post-Production / Sales

6.6 Product Identification and Traceability Product identification and traceability shall be in accordance with QOP-08-01 (Product Identification and Traceability).

6.7 Supplier Selection, Approval, and Monitoring In accordance with QOP-06-01 (Supplier Selection, Approval and Monitoring) and WI-06-01-02 (Supplier Approval and Maintenance), L-3 EDI shall, when necessary, conduct a supplier survey of the electronics franchised distributor, and electronics assembly/equipment subcontractors and contract manufacturers providing items (e.g. circuit card / printed wiring /tabbing board assemblies, or other electronic equipment) where the electronic components may also be procured by the contract manufacturer, the subcontractor, or the subcontractor’s sub-tier suppliers. When selecting electronics distributors, L-3 EDI shall give preferential consideration to franchised distributors (i.e. OCM/OEM authorized/approved). As may be necessary due to such situations as DMSMS, L-3 EDI shall only select an electronics independent distributor from the L-3 Approved Independent Distributor List. This list is maintained by L-3 Communications, and is flowed down to all L-3 Communications divisions. Any electronics independent distributor chosen for an A/PEC purchase must reside on this list. (All electronics independent distributors that

reside on this list have already been surveyed by L-3 Communications, and do not require an additional supplier survey from L-3 EDI).

6.7.1 Electronics Independent Distributor Screening The L-3 Communications approved independent distributor and part number shall be screened through second or third party entities, prior to generating a purchase order to identify any counterfeit or substandard part occurrences, or debarment actions. Results of these screens shall be used to determine the levels of risk associated with the specific purchase. Figure 5 and Table 1 provide tools to facilitate assessing the level of risk. Such second and/or third party entities include, but shall not be limited to:

Excluded Parties Listing System (EPLS) pursuant to L-3 Communications Corporate Policy No. 703 (Hiring or Using Debarred or Suspended Individuals or Entities),

ERAI,

IDEA,

GIDEP,

L-3 Communications Intranet Counterfeit Parts Website contains a list of electronics

independent distributors that have been reviewed and approved by L-3 Communications, based upon surveys and/or historical data. This list contains critical information on each distributor that includes contact information, certifications, survey status, risk-mitigation processes, test facilities used for part authenticity, test facility capabilities, etc.

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The information contained in this document does not contain “technology” as defined by the General Technology Note in Export Administration Regulations (EAR) Supplement number 2 to Part 744 and is therefore considered as publicly released as defined in Part 734.7(4).

6.7.2 A/PECs Supplier Survey L-3 EDI shall, when necessary, conduct a supplier survey of the electronics franchised distributor, and electronics assembly/equipment subcontractors and contract manufacturers providing items (e.g., circuit card / printed wiring /tabbing board assemblies or other electronic equipment) where the electronic components may also be procured by the contract manufacturer, the subcontractor, or the subcontractor’s sub-tier suppliers, and electronic component test service providers. The type of survey(s) to be conducted shall be dependent upon a number of factors, such as, but not limited to:

the item’s criticality in its application, and its associated price

the supplier’s counterfeit part performance history available in the public domain (e.g., GIDEP, ERAI, IDEA) or L-3 Communications Intranet Counterfeit Parts Website

the supplier’s membership in trade associations such as GIDEP, ERAI or IDEA, with

rigorous ethical, business, and quality standards specifically structured to avoid the acquisition and resale of counterfeit parts

the supplier’s quality management system (e.g., AS9100 Quality Systems - Aerospace -

Model for Quality Assurance in Design, Development, Production, Installation and Servicing, ISO 9001 (Quality Management System Requirements), AS9120 (Quality Management Systems – Aerospace Requirements for Stocklist Distributors), JESD 31 (General Requirements for Distributors of Commercial and Military Semiconductor Devices))

the supplier’s counterfeit part risk mitigation plan, based on SAE AS5553 (preferred)

Figure 5 and Table 1 provide tools to facilitate assessing the level of risk and developing a commensurate supplier approval risk mitigation strategy which may include:

Conductance of an on-site quality survey using Fo-000255 (Standard Supplier On-Site Survey Form)

Conductance of a Supplier Capabilities & Risk Assessment,

Conductance of a Critical Supplier Financial Risk Assessment,

Conductance of a supplier questionnaire using Fo-000254 (L-3 Supplier Questionnaire)

and/or,

Conductance of an electronics independent distributor survey using Fo-000260 (Counterfeit Mitigation Assurance).

Contingent upon a satisfactory supplier survey and counterfeit part risk mitigation strategy, the supplier shall be entered into L-3 EDI’s approved supplier register per WI-06-01-02 (Supplier Approval and Maintenance).

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The information contained in this document does not contain “technology” as defined by the General Technology Note in Export Administration Regulations (EAR) Supplement number 2 to Part 744 and is therefore considered as publicly released as defined in Part 734.7(4).

6.8 Electronics Procurement Process

6.8.1 General The procurement process shall be in accordance with QOP-06-02 (Purchase Order Generation) and WI-06-02-03 (Creating Purchase Requisitions and Purchase Orders in ERP), and as further detailed in Figure 2 and Figure 3 herein. The Components Products Group and Systems Product Group purchasing functions shall only procure A/PECs and assemblies and equipment containing A/PEC’s (e.g., circuit card/printed wiring/ tabbing board assemblies or electronic equipment) from approved suppliers (i.e. OCM/OEM, OCM/OEM-authorized distributor, and L-3 Communications approved independent distributor). Procurement Requirements for Independent Distributors (reference Figures 1 and 2): a) EDI shall use only L-3 approved Independent Distributors for the purchase of obsolete

components or part authentication testing. The L-3 Quality and Supply Chain intranet sites provide the names and details of approved Independent Distributors.

b) EDI Procurement is to engage Program Management, Engineering, and Quality and assess the need for a design change to specify a component currently available from the OCM or through franchised distributors. If a design change is not feasible, then the decision to remanufacture the part from a qualified approved remanufacturer shall be assessed. Design change or remanufacture assessments shall be documented in the procurement records.

c) Procurement from an independent distributor requires the approval of the Product Group Procurement Manager and Product Assurance Manager prior to issuance of a Purchase Order. Copies of such Purchase Orders are to be provided to the Vice President of Quality when issued to the supplier.

d) When procuring active components from an Independent Distributor, the purchase order

clause referenced in Exhibit A, including test requirements defined therein, shall be used. EDI may add but not diminish testing requirements listed in Exhibit A.

e) When procuring passive components and connectors from an Independent Distributor, the purchase order clause referenced in Exhibit B, including testing requirements defined therein shall be used. EDI may add but not diminish testing requirements listed in Exhibit B.

f) When procuring assemblies from contract manufacturers or subcontractors, and when components are procured by the subcontractor or contract manufacturer, the clause referenced in Exhibit C shall be used.

g) EDI shall ensure that Authenticity Testing Reports received from the Independent Distributors are thoroughly reviewed upon receipt. EDI must confer with the leader of the L-3 Counterfeit Parts Team when a report indicates that a part is deemed suspect counterfeit.

Furthermore, the Components Products Group and Systems Product Group purchasing and material management functions shall provide preferential consideration to procure A/PECs from the OCM/OEM, or from an OCM/OEM-authorized distributor to ensure:

OCM/OEM warranty provisions,

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The information contained in this document does not contain “technology” as defined by the General Technology Note in Export Administration Regulations (EAR) Supplement number 2 to Part 744 and is therefore considered as publicly released as defined in Part 734.7(4).

Product integrity via proper handling, storage and shipping procedures, Failure analysis and corrective action support, and Traceability via Certificates of Conformance (CofC’s) and acquisition traceability.

Due to the ever-changing OCM/OEM and authorized distributor relationships, it is the responsibility of Purchasing to ensure that an item is procured from an approved supplier, and specifically in the context of this procedure that the A/PEC is not procured from a source that can be classified as a non-approved electronics independent distributor. Purchasing shall:

a. Provide preferential consideration to procure A/PECs from the OCM/OEM or from an OCM/OEM-authorized distributor.

b. Consult with the OCM/OEM or OCM/OEM-authorized distributor to confirm that the potential distributor is authorized or franchised by the OCM/OEM to sell the specific item being procured.

c. When necessary, procure A/PECs from an L-3 Communications approved electronics independent distributor. The procurement process shall be in accordance with QOP-06-02 and as further detailed herein.

NOTE In contrast to 6.8.1a, 6.8.1c is the riskier alternative of the two. Consequently, it is essential that (a) adequate due diligence is exercised to confirm that there is no authorized distributor procurement alternatives, and (b) proper planning and risk mitigation (see 6.8.2) is employed to prevent counterfeit parts from being procured and entering into the L-3 EDI’s customers’ supply stream.

6.8.2 Procurement Process

6.8.2.1 Quality Assurance Requirements Assignment and Flowdown Quality Assurance Engineering is responsible to ensure the flowdown of the applicable quality requirements in accordance with WI-09-01-05 (Procedure for Part Maintenance in Visual).

To facilitate the flowdown of quality assurance requirements, L-3 EDI’s Form 1002, Supplier Quality Assurance Requirements (SQARs), has pre-established counterfeit part requirements, as follows:

a. SQAR Clause 1A, 1B or 1C, as applicable, contains L-3 EDI’s Suspect Counterfeit/Counterfeit/Substandard/Unapproved Parts/Items general requirements, including requiring electronics assembly/equipment subcontractors and contract manufacturers who are procuring their own A/PECs to have a counterfeit part risk mitigation plan modeled after SAE AS5553 (preferred) for L-3 EDI’s review and approval.

b. SQAR Clause 3A requires OCM/OEM CofC and/or distributor’s CofC to be supplied with shipment unless otherwise authorized in writing by L-3 EDI.

NOTE SQAR Clauses 1A, 1B, or 1C, and 3A are designed to be specified on each production part purchase order as specified in WI-06-02-02 (SQAR Application Guidelines).

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The information contained in this document does not contain “technology” as defined by the General Technology Note in Export Administration Regulations (EAR) Supplement number 2 to Part 744 and is therefore considered as publicly released as defined in Part 734.7(4).

6.8.2.2 Purchasing Risk Assessment Initiation The Buyer shall:

a. Perform the necessary due diligence to confirm the A/PEC is obsolete, or not readily available in support of L-3 EDI’s required quantity, quality, delivery, and/or cost targets from the OCM/OEM and/or OCM/OEM-authorized distributor(s).

b. To mitigate the risks inherent in the procurement of discrete electronic components,

assemblies, and equipment containing electronic components (e.g., circuit card / printed wiring /tabbing board assemblies or electronic equipment), Form 0208 (Counterfeit Risk Mitigation Procurement Plan (CRiMPP)) may be initiated at the discretion of the buyer and CP SME for approval prior to the PO’s being placed in accordance with QOP-06-02 (Purchase Order Generation) for the following types of suppliers:

i. Distributors of electronic components, where the distributor is NOT an authorized or franchised distributor by the OCM/OEM for the item being procured,

ii. Contract manufacturers, sometimes also referred to as subcontractors or

subcontract manufacturers, where the manufacturer is procuring electronic components or assemblies in support of their internal assembly process,

--- OR ---

iii. Equipment manufacturers, where the manufacturer is procuring electronic

components or assemblies in support of their internal assembly/manufacturing process.

c. If necessary, complete Form 0208 (Counterfeit Risk Mitigation Procurement Plan

(CRiMPP)) and provide to Supplier Quality Assurance and SPG Component/Reliability Engineering for review, approval, and the development of a commensurate risk mitigation strategy to mitigate the risks associated with the procurement by identifying / providing information such as the following, but not limited to:

i. the justification for the procurement ii. the availability of the OCM/OEM CofC iii. the OCM/OEM manufacturer, part number, and date code/lot no. iv. the subcontractor, contract manufacturer, or equipment manufacturer’s counterfeit

part risk mitigation plan based on SAE AS5553 (preferred) v. the list of authenticity tests/inspections necessary

6.8.2.3 Component / Reliability Engineering and Supplier QA Risk Assessment and Mitigation

Strategy Initiation Component / Reliability Engineering and Supplier QA shall conduct a counterfeit part risk assessment, which should include, but not be limited to:

a. Confirmation that the OCM/OEM was qualified to produce the electronic component at the time of the date code(s) of the A/PECs intended to procure, as applicable.

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The information contained in this document does not contain “technology” as defined by the General Technology Note in Export Administration Regulations (EAR) Supplement number 2 to Part 744 and is therefore considered as publicly released as defined in Part 734.7(4).

b. Screening supplier and part number for any reported counterfeit part incidents in sources such as, but not limited to:

i. EPLS ii. ERAI iii. IDEA iv. GIDEP v. FAA UPN database, and/or vi. L-3 Communications Intranet Counterfeit Parts Website

c. Evaluating supplier performance data obtained via WI-06-01-01 (Supplier Performance Assessment).

d. Developing a commensurate risk mitigation strategy for purchases made from an L-3 Communications approved independent distributor, which shall include, but not be limited to:

Mandatory Risk Mitigation Strategies: i. Requiring the CofC from either the OCM/OEM or their authorized distributor for

purchases of active or passive electronic components, or connectors.

ii. Requiring compliance with L-3 EDI’s Suspect Counterfeit/Counterfeit/Substandard/Unapproved Parts/Items requirements.

iii. Requiring the following authenticity tests and inspections by the distributor or 3

rd-

party test facility for ACTIVE ELECTRONIC COMPONENTS, in the absence of a CofC from the OCM/OEM. (Note: results of the authenticity tests and inspections shall be documented in an authenticity report

delivered to L-3 EDI, and may substitute for the CofC only per the written consent of L-3 EDI Purchasing and Supplier Quality Manager, and shall appear as part of the P.O. flow-down clauses to the distributor. See Figure 4 for L-3 EDI’s Inspection and Test Risk Mitigation Model.)

I. Visual Microscopy Inspection at 10X Minimum Magnification (100% Lot

Inspection) II. X-Ray Inspection (100% Lot Inspection)

III. X-Ray Fluorescence (XRF) and Restriction of Hazardous Substances (ROHS) Testing (2 Parts per Lot Date Code)

IV. Resistance to Solvents Testing (2 Parts per Lot Date Code) V. Heated Solvent Testing Using Dynasolve Immersion (2 Parts per Lot Date

Code) VI. Scrape Testing (2 Parts per Lot Date Code)

VII. Solderability Testing per IPC/EIA J-STD-002 (2 Parts per Lot Date Code) VIII. De-Lid, Die Penetrate, Die Verification (2 Parts per Lot Date Code) IX. Scanning Electron Microscopy (1 Part per Lot Date Code)

iv. Requiring the following authenticity tests and inspections by the distributor or 3

rd-

party test facility for PASSIVE ELECTRONIC COMPONENTS & CONNECTORS,

in the absence of a CofC from the OCM/OEM. (Note: results of the authenticity tests and inspections shall be documented in an

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The information contained in this document does not contain “technology” as defined by the General Technology Note in Export Administration Regulations (EAR) Supplement number 2 to Part 744 and is therefore considered as publicly released as defined in Part 734.7(4).

authenticity report delivered to L-3 EDI, and may substitute for the CofC only per the written consent of L-3 EDI Purchasing and Supplier Quality Manager, and shall appear as part of the P.O. flow-down clauses to the distributor. See Figure 4 for L-3 EDI’s Inspection and Test Risk Mitigation Model.)

I. Applicable Electrical Testing (Resistance, Capacitance, Continuity) (1% AQL) II. Visual Microscopy Inspection at 10X Minimum Magnification (100% Lot

Inspection) III. X-Ray Inspection for Non-Glass Diodes and Tantalum Capacitors (100% Lot

Inspection) IV. X-Ray Fluorescence (XRF) and Restriction of Hazardous Substances

(ROHS) Testing (2 Parts per Lot Date Code) V. Resistance to Solvents Testing (2 Parts per Lot Date Code)

VI. Heated Solvent Testing Using Dynasolve Immersion (2 Parts per Lot Date Code)

VII. Scrape Testing (2 Parts per Lot Date Code) VIII. Solderability Testing per IPC/EIA J-STD-002 (2 Parts per Lot Date Code) IX. Scanning Electron Microscopy for Metal-Packaged Parts Only (1 Part per Lot

Date Code)

Additional Risk Mitigation Strategies including: v. Obtaining pictures or samples of parts for L-3 EDI review prior to shipment.

vi. Requiring additional inspection and/or testing by L-3 EDI prior to (preferred) or post shipment. (See Figure 4 for L-3 EDI’s Inspection and Test Risk Mitigation Model.)

vii. Establishing an escrow service thru ERAI.

e. Requiring subcontractors and contract manufacturers of electronic

assemblies/subassemblies to purchase active and passive electronic components and connectors directly from the OCM/OEM or their authorized distributor(s), and provide objective evidence to those purchases. (Note that purchases made from any independent distributor/broker shall not be performed without the written consent of L-3 EDI Purchasing and the Supplier Quality Manager.)

f. [OPTIONAL] Document L-3 EDI’s risk mitigation strategy on Form 0208 (Counterfeit Risk Mitigation Procurement Plan (CRiMPP)), and approve. Form shall be routed for additional approvals, such as Program Management, Product Group Vice President, and Quality Assurance Vice President, as applicable. Upon obtaining all necessary approvals, Form 0208 shall be distributed to applicable actionees and parties, such as, but not limited to:

i. Purchasing, ii. Receiving Inspection, iii. SPG Component/ Reliability Engineering, iv. Product Assurance, v. Engineering, and/or vi. Manufacturing.

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The information contained in this document does not contain “technology” as defined by the General Technology Note in Export Administration Regulations (EAR) Supplement number 2 to Part 744 and is therefore considered as publicly released as defined in Part 734.7(4).

vii. NOTE Product Assurance shall ensure compliance to any customer specific requirements regarding the usage of independent distributors and/or Counterfeit Parts by consulting the applicable Quality Plan developed in accordance with QOP-02-01 (Development of Quality Plans) and/or the customer’s contract/purchase order.

6.8.3 Purchasing Procurement Process After receipt of approved Form 0601 (Purchase Requisition), the Buyer shall, if used, execute directions as specified in Form 0208 (Counterfeit Risk Mitigation Procurement Plan (CRiMPP)), and shall then place the order in accordance with QOP-06-02 (Purchase Order Generation) and WI-06-02-03 (Creating Purchase Requisitions and Purchase Orders in ERP):

a. Flows down applicable requirements as specified on Form 0208 (Counterfeit Risk

Mitigation Procurement Plan (CRiMPP)).

b. Flows down the following Form 1002 Supplier QA Requirements (SQARs), as applicable, pursuant to assignment as specified in WI-09-01-05 (Procedure for Part Maintenance in Visual):

i. SQAR Clause 1A, 1B or 1C, as applicable, which contains L-3 EDI’s Suspect

Counterfeit/Counterfeit/Substandard/Unapproved Parts/Items general requirements.

ii. SQAR Clause 3A which requires OCM/OEM CofC and/or distributor’s CofC to be

supplied with shipment unless otherwise authorized in writing by L-3 EDI.

c. Coordinates with appropriate parties the receipt of an authenticity report for all required inspections and tests that may have been requested of the L-3 Communications approved independent distributor or 3

rd-party test facility.

d. Procures CP testing services, when required, from L-3 Communications approved

independent distributors and 3rd-party test facilities.

NOTE

A List of Component Test Services is available on the L-3 Communications Intranet Counterfeit Parts Website and the IDEA website.

6.8.4 Quality Planning Quality Assurance Engineers (QAEs) shall generate inspection and test procedures as specified in WI-10-01-11 (Inspection Procedures) and QA-182 (Test Procedure Document, Generation, Release and Management), respectively, in such a manner that will maximize the potential for detecting counterfeit parts and thereby minimizing the potential risk of counterfeit parts from entering our customers’ supply chain.

6.8.5 Receiving Inspection Upon receipt of shipment, Receiving Inspection shall, if used, execute directions and testing per Form 0208 (Counterfeit Risk Mitigation Procurement Plan (CRiMPP)) in accordance with QOP-10-01 (Inspection and Testing) and QA-027 (Inspection History Folder Description Use and Execution).

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The information contained in this document does not contain “technology” as defined by the General Technology Note in Export Administration Regulations (EAR) Supplement number 2 to Part 744 and is therefore considered as publicly released as defined in Part 734.7(4).

Inspection procedures and test procedures shall be executed as specified in WI-10-01-11 (Inspection Procedures) and QA-182 (Generation, Release and Management of Test Procedures), respectively. Counterfeit part visual inspection workmanship criteria shall be as specified in QA-064 (Workmanship Elements). QA-064 addresses the following SP/CP authenticity-related elements:

a. Documentation of visual inspection criteria, and b. A/PEC external visual inspection criteria, inclusive of:

i. component body, ii. leads, and iii. marking.

The following documents and sources can be useful in determining the acceptability of A/PECs:

IDEA–STD-1010: Acceptability of Electronic Components Distributed in the Open Market. L-3 Communications Intranet Counterfeit Parts Website A free website named ic photos that provides photographs of A/PECs that can be used for

authentication comparison purposes. All CofCs, authenticity reports, attribute and variables data, and invoices shall be retained by Receiving Inspection.

6.9 Production The stocking and handling of items shall be in accordance with QOP-15-01 (Handling, Storage, Packaging, Preservation, and Delivery). Manufacturing activities shall be in accordance with QOP-09-01 (Process Control). Material handling personnel and production operators shall be vigilant and report any noted anomalous/suspect part conditions to their supervisor for appropriate action. Inspection procedures and test procedures shall be executed by inspection and test personnel as specified in WI-10-01-11 (Inspection Procedures) and QA-182 (Generation, Release and Management of Test Procedures), respectively. Counterfeit part visual inspection workmanship criteria shall be as specified in QA-064 (Workmanship Elements).

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The information contained in this document does not contain “technology” as defined by the General Technology Note in Export Administration Regulations (EAR) Supplement number 2 to Part 744 and is therefore considered as publicly released as defined in Part 734.7(4).

6.10 SP/CP Control and Reporting SPs/CPs shall be processed as nonconforming items in accordance with QOP-13-01 (Control of Nonconforming Product). When an SP/CP has been determined to have been delivered to a customer, consult QOP-13-01 (Control of Nonconforming Product) for the applicable customer notification process.

NOTE For affected customer-delivered products where L-3 EDI is an FAA Production Approval Holder (PAH), also consult FAA AC 00-58 (Voluntary Disclosure Reporting Program), and WI-02-01-03 (FAA Requirements Compliance Plan) for specific actions.

Corrective actions shall be processed in accordance with QOP-14-01 (Corrective and Preventive Action). Any part determined to be an SP/CP at L-3 EDI shall be:

a. Impounded by L-3 EDI as specified in Form 1002 SQAR 1A, 1B, or 1C

b. Identified and processed as nonconforming

c. Dispositioned as scrap

d. Physically rendered unusable to prevent SPs/CPs from re-entering the supply stream pursuant to QOP-13-01 (Control of Nonconforming Product)

e. Reported to:

i. L-3 Communications Vice President of Corporate Procurement ** ii. Part’s Distributor ** iii. Affected End User/Customer per QOP-13-01 (Control of Nonconforming Product) ** iv. L-3 Communications Counterfeit Parts Team via Counterfeit Parts History (CPH)

Cards. (CPH Cards may be generated at the Intranet Counterfeit Parts Website) ** v. ERAI ** vi. GIDEP via L-3 EDI’s Contracts or Legal Department ** vii. IDEA * viii. the FAA via submission of FAA Form 8120-11 (Suspect Unapproved Parts Report)

as specified in FAA AC 21-29 (Detecting and Reporting Suspected Unapproved Parts) for those products where L-3 EDI is an FAA Production Approval Holder (PAH) *

ix. the applicable agency(ies) or other interests as may be specified in the applicable governing statutory or regulatory regulations or policies, and/or the customer’s governing contract/purchase order *

Legend: * Recommended; ** Required.

NOTE

Product Assurance shall ensure compliance to any customer specific requirements regarding the dispositioning or reporting of SPs/CPs by consulting the applicable Quality Plan developed in accordance with QOP-02-01 (Development of Quality Plans) and/or the customer’s contract/purchase order.

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The information contained in this document does not contain “technology” as defined by the General Technology Note in Export Administration Regulations (EAR) Supplement number 2 to Part 744 and is therefore considered as publicly released as defined in Part 734.7(4).

Any part determined to be an SP/CP at an L-3 Communications approved independent distributor or 3

rd-party test facility as a result of authenticity testing shall be quarantined/destroyed per their

internal company procedures. The distributor shall immediately notify L-3 EDI of the SP/CP. Once notified, L-3 EDI shall then report the occurrence to the same entities listed before under bullet “e” (entities i through ix).

6.11 Sustaining Engineering Sustaining engineering activities shall be as specified in accordance with QOP-04-04 (Sustaining Engineering).

6.12 Audits L-3 EDI’s Counterfeit Parts Risk Mitigation Plan shall be subjected to periodic audits in accordance with QOP-17-01 (Internal Quality Audits).

6.13 Warranty and Post-Delivery Support L-3 EDI’s warranty policy and post-delivery support shall be as specified in QOP-19-01 (Warranty).

6.14 Training The appropriate L-3 EDI functional departments shall be trained in their roles and responsibilities regarding counterfeit parts in accordance with QOP-18-01 (Training) and Training Course, TC-02-001 (Counterfeit Parts Training Course).

6.15 Records and Reporting Requirements Records shall be maintained in accordance with QOP-16-01 (Control of Quality Records). This shall include any authenticity reports provided by L-3 Communications approved independent distributors or 3

rd-party test facilities.

EDI shall request and retain original Certificates of Conformance (C of Cs) for all purchases from OCMs and Authorized Franchisees of OCMs. Record retention requirements shall be in accordance with contract and QOP-16-01 requirements.

b) All documentation received with products from Independent Distributors is to be retained by EDI. This includes test reports, certificates of conformance/compliance, attribute and variables data, and invoices. Record retention requirements shall be in accordance with contract and QOP-16-01 requirements.

c) When L-3 Approved Independent Distributors are contracted for suspect counterfeit parts screening/testing only, the distributor is required to report counterfeit experiences they identify to L-3. EDI must then report this information to the L-3 VP, Quality and proceed as depicted in Figure 3.

d) The EDI Vice President of Quality must be notified before sending parts in inventory for authenticity testing.

e) If a suspect or counterfeit part is discovered EDI must immediately report the incident to the L-3 VP, Quality and proceed as depicted in Figure 3.

f) L-3 Approved Independent Distributors are required to impound suspect and counterfeit parts identified during the screening process and quarantine/destroy them per their company procedures. Suspect or counterfeit parts identified shall be impounded pending direction from the L-3 Legal department.

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The information contained in this document does not contain “technology” as defined by the General Technology Note in Export Administration Regulations (EAR) Supplement number 2 to Part 744 and is therefore considered as publicly released as defined in Part 734.7(4).

Exhibit A

Independent Distributor Purchase Order Clause – Active Components

Independent Distributor's procedures shall meet the requirements of IDEA‐STD‐1010 & SAE AS5553 and have a Quality Management System certified to AS9120:2002. The requirements of AS6081 shall be in effect upon industry release of this standard.

The original manufacturers Certificate of Conformance (C of C) and all traceability documentation shall be included with each shipment of parts. It shall include the manufacturer’s name, part number, date codes, lot codes, serializations, and / or any other batch identifications. Seller is to contact Buyer in the event that the original OEM/OCM C of C and traceability documentation is not available. All inspecting and testing shall be performed to the original manufacturer’s specifications and parameters. Recorded evidence of all testing performed shall be included with each shipment.

The following inspections and tests are required:

Visual Microscopy Inspection of all parts in the order under 10X minimum magnification (100% of the lot)

X‐Ray inspection (100% of the lot) XRF/RoHS (2 parts per lot date code)

Resistance to Solvents testing (2 parts per lot date code)

Heated Solvent testing (Dynasolve Immersion) (2 parts per lot date code)

Scrape testing (2 parts per lot date code)

Solderability testing per IPC/EIA J‐STD‐002 (2 parts per lot date code) De‐lid, Die Penetrate, Die Verification (2 parts per lot date code)

Scanning Electron Microscopy (1 part per lot date code)

If suspect/counterfeit parts are furnished under this subcontract and are found in any of the goods delivered hereunder, such items will be impounded by Buyer. The Seller shall promptly replace such suspect/counterfeit parts with parts acceptable to the Buyer and the Seller shall be liable for all costs relating to the removal and replacement of said parts as specified in the subcontract requirements or Distributor’s insurance policies. Buyer reserves all contractual rights and remedies to address grievances and detrimental impacts caused by suspect/counterfeit parts.

All occurrences of Suspect Counterfeit and/or Counterfeit parts will be immediately reported to ERAI.

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The information contained in this document does not contain “technology” as defined by the General Technology Note in Export Administration Regulations (EAR) Supplement number 2 to Part 744 and is therefore considered as publicly released as defined in Part 734.7(4).

Exhibit B

Independent Distributor Purchase Order Clause – Passive Components

and Connectors

Independent Distributor's procedures shall meet the requirements of IDEA‐STD‐1010 & SAE AS5553 and have a Quality Management System certified to AS9120:2002. The requirements of AS6081 shall be in effect upon industry release of this standard.

The original manufacturers Certificate of Conformance (C of C) and all traceability documentation shall be included with each shipment of parts. It shall include the manufacturer’s name, part number, date codes, lot codes, serializations, and / or any other batch identifications. Seller is to contact Buyer in the event that the original OEM/OCM C of C and traceability documentation is not available. All inspecting and testing shall be performed to the original manufacturer’s specifications and parameters. Recorded evidence of all testing performed shall be included with each shipment.

The following inspections and tests are required:

Applicable electrical testing (resistance, capacitance, continuity) for the devices procured (1% AQL Level II)

Visual Microscopy Inspection of all parts in the order under 10X minimum magnification (100% of the lot)

X‐Ray inspection for non‐glass diodes and tantalum capacitors (100% of the lot) XRF/RoHS (2 parts per lot date code)

Resistance to Solvents testing (2 parts per lot date code) Heated Solvent testing (Dynasolve Immersion) (2 parts per lot date code)

Scrape testing (2 parts per lot date code)

Solderability testing per IPC/EIA J‐STD‐002 (2 parts per lot date code)

Scanning Electron Microscopy for metal packaged parts only (1 part per lot date code)

If suspect/counterfeit parts are furnished under this subcontract and are found in any of the goods delivered hereunder, such items will be impounded by Buyer. The Seller shall promptly replace such suspect/counterfeit parts with parts acceptable to the Buyer and the Seller shall be liable for all costs relating to the removal and replacement of said parts as specified in the subcontract requirements or Distributor’s insurance policies. Buyer reserves all contractual rights and remedies to address grievances and detrimental impacts caused by suspect/counterfeit parts.

All occurrences of Suspect Counterfeit and/or Counterfeit parts will be immediately reported to ERAI.

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The information contained in this document does not contain “technology” as defined by the General Technology Note in Export Administration Regulations (EAR) Supplement number 2 to Part 744 and is therefore considered as publicly released as defined in Part 734.7(4).

Exhibit C

Purchase Order Clause for Subcontractors and Contract Manufacturers

Only new and authentic materials are to be used in products delivered to Buyer. No counterfeit or suspect counterfeit parts are to be contained within the delivered product. Parts shall be purchased directly from the OCMs/OEMs, or through the OCM/OEMs Franchised Distributor. Documentation must be available that authenticates traceability to the applicable OCM/OEM. Independent Distributors (Brokers) shall not be used without written consent from Buyer (L‐3).

Definitions

Counterfeit – a part that is an illegal or unauthorized copy or substitute of an OEM item; an item that does not contain the proper external or internal materials or components required by the OEM or that is not constructed in accordance with OEM specification; an item or component thereof that is used, refurbished or reclaimed but the Seller represents as being a new item; an item that has not successfully passed all OEM required testing, verification, screening and quality control but that Seller represents as having met or passed such requirements; or an item with a label or other marking intended, or reasonably likely, to mislead a reasonable person into believing a non‐OEM item is a genuine OEM item when it is not. Parts that have been modified pursuant to a specific L‐3 purchase order requirement, such as refinished, up‐screened, or up‐rated parts that are properly identified as such are not considered suspect or counterfeit.

Suspect Counterfeit – A part in which there is an indication by visual inspection, testing, or other information that it may have been misrepresented by the supplier or manufacturer and may meet the definition of a counterfeit part.

OCM – Original component manufacturer

OEM – Original equipment manufacturer

Franchise Distributor – A distributor with whom the OCM has a contractual agreement to buy, stock, re‐package, sell and distribute its product lines. Franchised distributors normally offer the product for sale with full manufacturers warranty. Franchising contracts may include clauses that provide for the OCM's marketing and technical support, failure analysis and corrective action, and exclusivity of inventory.

Independent Distributor (Broker) – A distributor that purchases parts with the intention to resell them. Independent Distributors may be franchised for selected, but not all, product lines. For purposes of counterfeit risk mitigation, a distributor is considered independent when not franchised for the item to be procured.

Electrodynamics, Inc. Work Instruction

WI-02-01-02B Page 29 of 35

The information contained in this document does not contain “technology” as defined by the General Technology Note in Export Administration Regulations (EAR) Supplement number 2 to Part 744 and is therefore considered as publicly released as defined in Part 734.7(4).

Electrodynamics, Inc. Work Instruction

WI-02-01-02B Page 30 of 35

The information contained in this document does not contain “technology” as defined by the General Technology Note in Export Administration Regulations (EAR) Supplement number 2 to Part 744 and is therefore considered as publicly released as defined in Part 734.7(4).

Requestor/Purchasing Supplier Quality SPG Component /

Reliability Engr.

Accounting Distributor

Figure 1. Subcontractor and Contract Manufacturer Approval Process

Design & Development / Production Sustainment

Process Elements of WI-02-01-02 (Counterfeit Part Risk Mitigation

Plan) in Support of Parent Requirements Document L-3

Corporate, CP-602 (Counterfeit Parts Risk Mitigation).

LEGEND

N

Y

Design Control

WI-04-01-07 Parts

Mgmt Plan

WI-04-01-08 Parts

Obsolescence Mgmt Program

Y

Approved? N

Approved?

Completes Financial Survey (Form 0604,

Section C)

Completes Form 0604, Section D

Enter into ERP System per WI-06-01-02

Completes/Executes Supplier Quality

and/or Risk Management

Survey(s)

Approved?

Completes Annual Supplier

Representations and Certifications (Form R & C)

N

Completes Debarment &

Counterfeit Part Risk Review (Form 0604, Section B)

Y

Supplier Approved?

Completes Supplier Profile (Form 0604,

Section A)

Performs Distributor

Selection & Standardization Process (QOP-06-01)

New Distributor

Determined to Be Required

Purchasing Forwards Annual Supplier

Representations and Certifications (Form R & C)

1

2

Reviews & Completes Supplier Quality

and/or Risk Mgmt Survey(ies)

Initiates Supplier Quality and/or Risk

Assessment Survey(s)

Dependent Upon Supplier Type and Risk Level Initiates On-Site Survey (Fo-000255),

Supplier Capabilities & Risk Assessment, Supplier Questionnaire (Fo-000254), Critical

Supplier Financial Risk Assessment, and/or Counterfeit Mitigation Assurance (Form Fo-

000260), as Determined to be Required.

Preference Given to: OCM/OEM Franchised/ Authorized Distributors. See Figure 5 for Independent Distributor Selection Risk Pyramid.

SPG Component / Reliability Approval Required, Only If

Independent Distributor

Screens Supplier & Part Number (if Available)

for Any Reported Counterfeit Part Incidents in

Sources Such As:

1. EPLS; 2. ERAI; 3. IDEA; 4. GIDEP; & 5. L-3

Communications Intranet Counterfeit Parts

Website.

Electrodynamics, Inc. Work Instruction

WI-02-01-02B Page 31 of 35

The information contained in this document does not contain “technology” as defined by the General Technology Note in Export Administration Regulations (EAR) Supplement number 2 to Part 744 and is therefore considered as publicly released as defined in Part 734.7(4).

Figure 2. Independent Distributor Procurement Process (Part 1 of 2)

Electrodynamics, Inc. Work Instruction

WI-02-01-02B Page 32 of 35

The information contained in this document does not contain “technology” as defined by the General Technology Note in Export Administration Regulations (EAR) Supplement number 2 to Part 744 and is therefore considered as publicly released as defined in Part 734.7(4).

Figure 3. Independent Distributor Procurement Process (Continued) (Part 2 of 2)

1

Receiving Inspection Inspects

per Established Inspection Plan

& Form 0208 as Appropriate

Ref QOP-10-01 & QA-027

Parts From An

Independent

Distributor or Suspect

Parts or Counterfeit

Parts?

N Y

Perform Additional Authenticity Testing,

Verification to Appendices A, B, C and

Inspection per Figure 4.

Passed?

Impound, Identify & Process

as Non-Conforming IAW

QOP-13-01

Conduct Preliminary Review / MRB per

QOP-13-01 & Corrective/ Preventive

Action per QOP-14-01

Disposition as Scrap & Physically

Render Unusable per QOP-13-01

Report Incident per Section 6.10

To Stock / Manufacturing IAW

QOP-15-01 and QOP-09-01

LEGEND

Process Elements of WI-02-01-02

(Counterfeit Part Risk Mitigation Plan) in

Support of Parent Requirements Document L-

3 Corporate, CP602 (Counterfeit Parts Risk

Mitigation)

Impounding, Identifying as

Nonconforming , Scrapping &

Physically Rendering Unusable

Serves to Prevent Suspect Parts

& Counterfeit Parts From

Reentering the Supply Steam.

Y

N

Electrodynamics, Inc. Work Instruction

WI-02-01-02B Page 33 of 35

The information contained in this document does not contain “technology” as defined by the General Technology Note in Export Administration Regulations (EAR) Supplement number 2 to Part 744 and is therefore considered as publicly released as defined in Part 734.7(4).

- In Electrical

A

A A

A

Figure 4. Inspection & Test Risk Mitigation Model

Verify Rcv’d

Independent

Distributor Docs &

Parts vs. PO

Requirements &

Flowdowns

(QA-027)

Compliant ?

Additional Insp/Testing

Required?

AUTHENTICITY TESTING & INSPECTION

FOR ACTIVE ELECTRONIC COMPONENTS

(PER Section 6.8.2.3)

AUTHENTICITY TESTING & INSPECTION

FOR PASSIVE ELECTRONIC

COMPONENTS & CONNECTORS (per

Section 6.8.2.3)

AUTHENTICITY TESTING & INSPECTION

FOR SUBCONTRACTORS & CONTRACT

MANUFACTURERS (per Section 6.8.2.3)

Passed?

Reject as Non-

Conformance per

QOP-13-01

QA-064

A

Y

Y

N

N

N

Y

TO STOCK

(QOP-15-01)

A

Go to

If Suspect Part or

Counterfeit Part is Found

Post-Stock

Hermeticity

Verification

(Optional) (2)

Go to

A

If Failed

Burn-

In (2)

Pre Burn-In

Electrical

Performance

Test (2)

Pre Burn-In

Electrical

Performance

Test (2)

A

Go to

If Failed

A

Go to

If Failed

Visual Examination Thermal Cycling

Examine Evidence of Marking

Deterioration or Other

Physical Damage/Degradation

NOTES >>> (1) As may be required based on rsk level of

Part being procured.

(2) Potential Testing Specifications:

- MIL-STD-883 (Microcircuits)

- MIL-STD-750 (Semiconductors).

- MIL-STD-202 or MIL-STD-1580

- Manufacturer’s Specifications

(3) Standard “resistance to solvents” tests (MIL-STD-202, Method

215, or JESD22-B107) may be effective. In some instances, more

aggressive solvents or test methods may be necessary to reveal

any forged markings, to remove coatings applied to disguise

sanding marks, and to reveal other indications that the OCM/OEM

APEC marking has been removed. Follow applicable

environmental, health and safety as specified in QOP-09-04 (Work

Environment).

VISUAL/MECHANICAL INSPECTIONS/TESTS

ELECTRICAL TESTING (OPTIONAL) (1)

THERMAL CYCLING (OPTIONAL) (1)

Electrodynamics, Inc. Work Instruction

WI-02-01-02B Page 34 of 35

The information contained in this document does not contain “technology” as defined by the General Technology Note in Export Administration Regulations (EAR) Supplement number 2 to Part 744 and is therefore considered as publicly released as defined in Part 734.7(4).

High

Figure 5. Independent Distributor Selection Risk Pyramid

L-3 Corporate, L-3 EDI or L-3 Sister Division On-Site Audited and Approved

AS9100 / AS9120 Certified

ISO9001 Certified

AS9100 / AS9120 / ISO9001 Compliant

ERAI / IDEA Member

No Counterfeit-Part

Reported Incidents

Established Quality

Performance &

Recognition

Sustained

Mature

Business

Processes

To Minimize Risk

Fill In More of the Pyramid

Risk Level Low

Electrodynamics, Inc. Work Instruction

WI-02-01-02B Page 35 of 35

The information contained in this document does not contain “technology” as defined by the General Technology Note in Export Administration Regulations (EAR) Supplement number 2 to Part 744 and is therefore considered as publicly released as defined in Part 734.7(4).

Individual Discrete Scenarios

OCM/OEM

& Ind Dist

Test

Data

Available?

OCM/OEM

CofC

Available?

Part Marking

Condition

(Visual Insp)

Part

“Newness”

Condition

(Visual Insp)

Ind Dist

CP

Incidents?

Part No. CP

Incidents?

Ind Dist CP

Incidents

for PN?

Ind Dist

IDEA /

ERAI

Member?

Part

Criticality

Part

Availability Part Price

Ris

k L

ev

el

Hig

h

NA

NA

Incorrect /

Not

Resistance to

Solvents

Gross

Degradation /

Evidence of

Installation

NA NA Yes NA High Low High

Me

diu

m

Hig

h

NA No

Correct But

Well-Faded /

Suspect

Moderate

Degradation

(e.g. Leads

Well Bent) /

Suspect

Yes Yes No Moderately

High

Moderately

Low

Moderately

High

Me

diu

m

NA

Correct But

Semi-Faded /

Semi-

Suspect

Slight

Degradation

(e.g. Leads

Slightly Bent)

Moderate Moderate Moderate

Me

diu

m

Lo

w

No Yes

Correct &

Slightly

Nondistinct

Like New

(e.g.

commensurate

w/Typical

Handling)

Moderately

Low

Moderately

High

Moderately

Low

Lo

w

Yes

NA

Correct &

Distinct

New

(e.g., No

Degradation)

No No No Yes Low High Low

Purpose & Instructions: To provide a relative baseline regarding the levels of perceived risk associated with various individual discrete scenarios that may be encountered at L-3 EDI. Each individual scenario that may be encountered is along the x-axis at the top of the table. Enter the table based on the scenario encountered and go down until you reach the “condition” identified for that scenario, then go across to the left to determine the approximate risk level. Repeat for each scenario. Based upon each scenario encountered and the relative risk associated with each, one should able to gage the level of risk for that procurement to facilitate determining a commensurate level of risk countermeasures to attempt to minimize the overall risk to an acceptable tolerant level based upon the set of circumstances and constraints present. Of course, the goal is to achieve a “low” risk level for each scenario; however, this is not always practical or achievable.

Table 1. Risk Assessment Matrix