CERTAIN PORTIONS OF THESE PROVISIONS HAVE BEEN OMITTED BASED ON A REQUEST FOR
CONFIDENTIAL TREATMENT SUBMITTED TO THE U.S. SECURITIES AND EXCHANGE COMMISSION
(THE "SEC"). THE NON-PUBLIC INFORMATION THAT HAS BEEN OMITTED FROM THESE
PROVISIONS HAS BEEN SEPARATELY FILED WITH THE SEC. EACH REDACTED PORTION OF
THESE PROVISIONS IS INDICATED BY A "[ * ]" AND IS SUBJECT TO THE REQUEST FOR
CONFIDENTIAL TREATMENT SUBMITTED TO THE SEC. THE REDACTED INFORMATION IS
CONFIDENTIAL INFORMATION OF TITANIMUM METALS CORPORATION AND THE BOEING COMPANY.
SPECIAL BUSINESS PROVISIONS
between
THE BOEING COMPANY
and
Titanium Metals Corporation
[ * ]
[LOGO GOES HERE]
Boeing Proprietary and Seller Proprietary
TABLE OF CONTENTS
TITLE PAGE
TABLE OF CONTENTS
AMENDMENT PAGE
RECITAL PAGE
1.0 DEFINITIONS..........................................................10
2.0 CONTRACT FORMATION...................................................11
2.1 Order......................................................11
2.1.1 Not Applicable. ..................................11
2.1.2 Issuance of Orders for Products and Services .....12
2.2 Entire Agreement...........................................12
2.3.1 Supporting Documentation and Priority ...........13
2.3.2 Revision of Documents .........................13
2.3.3 Compliance ..................................14
2.3.4 List of Certain Documents.........................14
2.4 Order of Precedence........................................14
2.5 Survival...................................................14
3.0 PERIOD OF PERFORMANCE AND PRICES....................................15
3.1 Performance................................................15
3.1.1 Period of Performance .........................15
3.1.2 Extension of Contract .........................15
3.2 Pricing....................................................15
3.2.1 Product Pricing ..................................15
3.2.2 Manufacturing Configuration .................16
3.2.3 Packaging ..................................16
3.2.4 Local Transportation Devices ................16
3.3 Subject Matter of Sale.....................................16
3.3.1 Nonrecurring Work .........................16
3.3.1.1 Tooling - General.........................16
3.3.1.2 Static and Fatigue Test Articles ........16
3.3.1.3 Contractor-Use Tooling (also known as
Seller-Use Tooling).......................17
3.3.1.4 Common - Use Tooling ................17
3.3.1.5 Use of Casting, Forging and
Extrusion Tools .........17
3.3.1.6 Initial Planning .........................17
3.3.1.7 Weight Status Reporting ................17
3.3.1.8 Integrated Product Team ................17
3.4 Type Design and Type Certification Data Development and
Protection...............................................17
4.0 GOVERNING QUALITY ASSURANCE REQUIREMENTS............................17
4.1 Seller Authorized Representative (AR) Requirements and
Obligations.................................................17
5.0 APPLICABLE LAW......................................................18
6.0 PRODUCT SUPPORT AND ASSURANCE; ON TIME DELIVERY.....................18
6.1 Warranty...................................................18
6.1.1 ............................................................18
6.1.2 ............................................................18
6.2 Integrated Materials Management (IMM) Program........................19
6.3 ON-TIME DELIVERY............................................19
7.0 PAYMENT.............................................................21
7.1 Recurring Price.............................................21
7.2 Nonrecurring Price/Special Charges..........................21
7.3 Payment Method..............................................21
7.4 Payment Errors..............................................21
7.5 Credit for Certain Orders...................................22
8.0 SCHEDULE ACCELERATION/DECELERATION..................................22
9.0 NOTICES.............................................................23
9.1 Addresses..................................................23
10.0 OBLIGATION TO PURCHASE AND SELL/VOLUME AND SHARE/REMEDIES...........23
11.0 COST PERFORMANCE VISIBILITY.........................................29
12.0 CHANGE PROVISIONS...................................................29
12.1 Reserved...................................................29
12.2 Computation of Equitable Adjustment........................29
12.3 Obsolescence...............................................29
12.4 Change Absorption (Nonrecurring/Recurring).................29
12.5 Planning Schedule/Forecasting..............................29
12.6 Total Cost Management/Lean Manufacturing
Process Improvement......................................30
12.7 Reserved...................................................32
12.8 Reserved...................................................32
12.9 Derivative Aircraft........................................32
13.0 SPARES AND OTHER PRICING............................................32
13.1 Spares.....................................................32
13.1.1 Spares Support .........................33
13.1.2 Reclassification or Re-exercises .......34
13.1.3 Spare Pricing .........................34
13.1.3.1 Aircraft on Ground (AOG) Requirement .....34
13.1.3.2 Seller's Less Than Manufacturing Lead-time
Spare.....................................34
13.1.4 Spares Special Handling ................34
13.2 Expedite of Production Requirements........................35
13.3 Tooling....................................................35
13.3.1 Responsible Party.........................35
13.3.2 Boeing Furnished Tooling ................35
13.3.3.1 Title to Tooling .........................35
13.3.3.2 Use and Disposition of Tooling .......35
13.3.3.3 Accountability for Tooling................35
13.3.3.4 Certified Tool Lists ................35
13.4 Pricing of Boeing's Supporting Requirements................36
13.5 Pricing of Requirements for Modification or Retrofit.......36
13.5.1 Boeing Responsibility or Regulatory
Requirement...............................36
13.5.2 Contract Aftermarket Modification or
Retrofit Work Performed by
Boeing...................................................36
13.6 Pricing of Similar Products................................36
14.0 STATUS REPORTS/REVIEWS...............................................36
14.1 General Reports / Reviews..................................36
14.2 Diversity Reporting........................................37
14.3 Program Manager.............................................37
14.4 Certified Tool List........................................37
14.5 Problem Reports............................................37
14.6 Reserved...................................................38
15.0 INTERNATIONAL COOPERATION............................................38
15.1 Market Access and Sales Support............................38
15.2 Offset Assistance..........................................38
15.3 Credit Against Aircraft Sales..............................39
16.0 BOEING FURNISHED MATERIAL/SUPPLIER BANKED MATERIAL..................39
16.1 Boeing Furnished Material...................................39
17.0 PARTICIPATION.......................................................40
17.1 Other Boeing Entities......................................40
17.2 Boeing Subcontractors / Suppliers..........................40
17.3 Notification of Contract...................................40
17.4 Notification of Price Reductions...........................40
18.0 INVENTORY AT CONTRACT COMPLETION....................................41
19.0 OWNERSHIP OF INTELLECTUAL PROPERTY..................................41
19.1 Technical Work Product.....................................41
19.2 Inventions and Patents.....................................41
19.3 Works of Authorship and Copyrights.........................41
19.4 Pre-Existing Inventions and Works of Authorship............41
19.5 Inapplicability............................................42
20.0 ADMINISTRATIVE AGREEMENTS...........................................42
21.0 GUARANTEED WEIGHT REQUIREMENTS......................................42
22.0 SELLER DATA REQUIREMENTS............................................42
23.0 DEFERRED PAYMENT....................................................42
24.0 SOFTWARE PROPRIETARY INFORMATION RIGHTS.............................42
25.0 CONFIGURATION CONTROL...............................................42
26.0 INFRINGEMENT........................................................43
27.0 RAW MATERIAL PROGRAM................................................43
27.1 Boeing Raw Material Strategy...............................43
27.2 Reserved...................................................43
28.0 DIGITIZATION OF PROPRIETARY INFORMATION AND MATERIALS...............43
29.0 ON-SITE SUPPORT......................................................44
29.1 Indemnification Negligence of Seller or subcontractor......44
29.2 Commercial General Liability...............................44
29.3 Automobile Liability.......................................44
29.4 Workers' Compensation......................................44
29.5 Certificates of Insurance..................................44
29.6 Self-Assumption............................................44
29.7 Protection of Property.....................................44
29.8 Compliance with Boeing Site Requirements...................44
30.0 BOEING TECHNICAL / MANUFACTURING ASSISTANCE REGARDING SELLER'S
NONPERFORMANCE.......................................................44
31.0 U.S. CUSTOMS INVOICE REQUIREMENTS...................................45
32.0 STRATEGIC ALIGNMENT.................................................45
33.0 CUSTOMS-TRADE PARTNERSHIP AGAINST TERRORISM (C-TPAT)................45
34.0 Reserved.............................................................45
35.0 DELIVERY - TITLE AND RISK OF LOSS...................................45
35.1 Delivery Point and Schedule................................45
35.2 Delivery Schedule of Other Products and Performance of
Services...................................................46
35.3 Transportation Routing Instructions........................46
35.4 Notification of Shipment...................................46
35.4.1 Title and Risk of Loss ................46
35.5 Notice of Delay - Premium Effort...........................46
36.0 PACKAGING AND SHIPPING..............................................46
36.1 Product Packaging..........................................46
36.2 Consolidated Shipments and Markings........................46
36.3 Freight Charges............................................46
36.4 Packing Sheet and Test Reports.............................46
36.5 Additional Copies..........................................46
36.6 Price Inclusive............................................46
37.0 ADDITIONAL QUALITY ASSURANCE REQUIREMENTS...........................46
37.1 Federal Aviation Administration Inspection.................46
37.2 Repair Authorization.......................................47
37.2.1 Boeing-Performed Work ................47
37.2.2 Reimbursement for Repairs................47
38.0 CHANGES.............................................................47
39.0 EXAMINATION OF RECORDS..............................................47
39.1 Reports....................................................47
40.0 EVENTS OF DEFAULT AND REMEDIES......................................47
40.1 Additional Event of Default Not Applicable.................47
40.2 Interest on Overdue Amounts................................47
41.0 CUSTOMER CONTACT....................................................47
42.0 SUBCONTRACTING......................................................47
43.0 SUPPLEMENTS AND MODIFICATIONS.......................................47
44.0 INCREMENTAL RELEASE AND CYCLE TIME REQUIREMENTS.....................48
44.1 Incremental Release........................................48
44.2 Cycle Time Requirements....................................48
45.0 SURPLUS PRODUCTS....................................................48
45.1 Return of Surplus Products.................................48
45.2 Use of Surplus Products....................................48
46.0 INTEGRATED PRODUCT TEAM.............................................48
46.1 Purpose....................................................48
46.2 Qualifications.............................................48
46.3 Removal of Personnel.......................................48
46.4 Work Schedule..............................................48
46.5 Equipment and Supplies.....................................48
46.6 Employment Status..........................................49
46.7 Team Leader................................................49
46.8 Discipline.................................................49
46.9 Insurance..................................................49
46.10 Indemnification............................................49
46.11 Compensation...............................................49
47.0 SELLER ASSISTANCE...................................................49
Not Applicable.......................................................49
48.0 DEFINE AND CONTROL AIRPLANE CONFIGURATION / MANUFACTURING RESOURCE
MANAGEMENT (DCAC/MRM)................................................49
49.0 ELECTRONIC ACCESS AND EXCHANGE OF DIGITAL PRODUCT DEFINITION.........49
49.1 Exchange of Digital Product Definition Between Boeing and
Seller......................................................49
49.2 System/Software Compatibility between Boeing and Seller....49
49.3 Electronic Access, Communications and Data Exchange via
Telecommunications..........................................50
50.0 AMENDMENT...........................................................50
51.0 AUTHORITY............................................................50
Signature Page
Attachment 1 Work Statement and Pricing
Attachment 1A Component Spares Requirements--Not Applicable
Attachment 2 Non-U.S. Procurement Report
Attachment 3 Rates and Factors
Attachment 4 Boeing AOG Coverage
Attachment 5 Boeing AOG Shipping Notification
Attachment 6 Seller Data Submittals
Attachment 7 Supplier Data Requirements List Customers / Engineering
--Not Applicable
Attachment 8 Commodity Listing and Terms of Sale
Attachment 9 Cost and Performance Reviews
Attachment 10 Quality Assurance Requirements
Attachment 11 Second Tier Support
Attachment 12 Commercial Invoice Requirements (Customs Invoice)
Attachment 13 On-Site Terms & Conditions Supplement--Not Applicable
Attachment 14 Production Article Delivery Schedule--Not Applicable
Attachment 15 Production Article Definition & Contract Change Notices
Not Applicable
Attachment 16 Non-Recurring and Recurring Price Status and Summary Tables
--Not Applicable
Attachment 17 Value Engineering Methodology--Reserved
Attachment 18 Indentured Priced Parts List and Spares Pricing--Not Applicable
Attachment 19 Incremental Release Plan and Lead Times--Not Applicable
Attachment 20 Schedule Change Examples--Reserved
Attachment 21 Seller's Standard Stocked Items
Attachment 22 Seller's Traditional Shipping Locations
Puget Sound POP/RM
Special Business Provisions Seller's Name: TIMET
dated 06/21/2005 [ * ]
* Certain information, indicated by "[ * ]" has been omitted and filed
separately with the U.S. Securities and Exchange Commission. Confidential
treatment has been requested with respect to such omitted portions.
INITIALS:MSC
AMENDMENTS
- --------------- ---------------------------------- -------------- --------------
Amend Description Date Approval
Number
- --------------- ---------------------------------- -------------- --------------
- --------------- ---------------------------------- -------------- --------------
- --------------- ---------------------------------- -------------- --------------
Puget Sound POP/RM
Special Business Provisions Seller's Name: TIMET
dated 06/21/2005 [ * ]
* Certain information, indicated by "[ * ]" has been omitted and filed
separately with the U.S. Securities and Exchange Commission. Confidential
treatment has been requested with respect to such omitted portions.
INITIALS:MSC
SPECIAL BUSINESS PROVISIONS
THESE SPECIAL BUSINESS PROVISIONS ("SBP") are entered into as of August 2 , 2005
and effective as of July 1, 2005 by and between Titanium Metals Corporation
("TIMET"), a Delaware corporation with its principal office in Denver, Colorado
("Seller"), and The Boeing Company, a Delaware corporation acting by and through
its Boeing Commercial Airplanes division ("Boeing"). Hereinafter, Seller and
Boeing may be referred to each as a "Party" and jointly as "Parties" hereto.
Now, therefore, in consideration of the mutual covenants set forth herein, the
Parties agree as follows:
1.0 DEFINITIONS
The definitions used herein are the same as those used in the GTA. In addition,
the following terms are defined as follows:
A. [ * ] means the [ * ] between the Parties entered into as of [ * ], as
may be amended from time to time by the Parties.
B. "Contract," "hereof," "hereto," "herein" and similar terms mean this
Special Business Provisions, including all Attachments, Exhibits and
Documents, and all amendments, modifications and supplements hereto.
C. "Drawing" means an electronic or manual depiction of graphics or
technical information representing a Product or any part thereof and
which includes the parts list and specifications relating thereto.
D. "Engineering Release" means engineering Drawings or other Documents,
approved by Boeing and released through Boeing's engineering Drawing
release system, that define the design requirements of any Product.
E. "Integrated Product Team" or "IPT" or "Design Build Team" or "DBT"
means a team composed of representatives from engineering, operations,
SM&P, design-to-cost and other disciplines as Boeing shall specify,
whose objective is to optimize designs for cost, weight, performance
and producibility.
F. "Manufacturing Work Package" or "Work Package" means manufacturing
effort that Seller will provide under this SBP.
G. "Miscellaneous Work" is Seller-performed work or services that
includes, but is not limited to, provision of additional test articles,
test support, field support and Boeing-used supplier facilities.
H. "Obsolescence" means the discontinuation of the requirement for any
Product as a result of engineering or manufacturing change, which has
rendered such Product no longer usable in the production of the Program
Airplane or any Derivative.
I. "Person" means any individual, partnership, corporation, limited
liability company, joint venture, association, joint-stock company,
trust, unincorporated organization or government or any agency or
political subdivision thereof or any other entity.
J. "Price" means the amount to be paid by Boeing to Seller for any Product
in accordance with the terms of this SBP.
K. "Prior Agreement" means the "Purchase and Sale Agreement (for titanium
products)" between the Parties amended and restated effective April 19,
2001.
L. "Program" means the design, development, marketing, manufacture, sales
and customer support of Program Airplanes, Derivatives and other
Products.
M. "Program Airplane" means a commercial transport aircraft incorporating
advanced technology and having a model designation of 737, 747, 767,
787 for which Seller shall provide any Product pursuant to this SBP.
N. "Value Engineering" is a single component of total cost management
designed to leverage BCA and Supplier Engineering resources to reduce
costs (to Sellers) and prices (to Boeing) for Products through
engineering changes in requirements, processes, or designs which in no
way reduce airplane safety, performance, maintainability, reliability,
producibility or capability.
2.0 CONTRACT FORMATION
2.1 Order
Any Order to which this SBP applies will include a statement incorporating this
SBP by reference unless otherwise specifically agreed to in writing by the
parties.
Each such Order will be governed by and be deemed to include the provisions of
this SBP.
2.1.1 Not Applicable.
2.1.2 Issuance of Orders for Products and Services
Boeing will notify Seller of its requirements for any Product and for any
Service under this SBP by issuing Orders in accordance with the provisions of
the GTA. Only Boeing or its designated Service Provider may issue Orders
hereunder. Such Orders will authorize performance, indicate Price (which is
determined in accordance with Attachment 1), establish schedule for delivery or
performance in accordance with then-applicable lead times, provide
identification of any such Product or Service, indicate the part number for
which the Products are being supplied and effect payment and accountability. Any
such Order shall include a statement incorporating this SBP by reference and
shall be governed by and be deemed to include the provisions of this SBP. From [
* ] through [ * ], Boeing and Seller shall process all Orders through [ * ].
Thereafter, during the term of this SBP commencing [ * ], the Parties will agree
upon a procedure for processing Orders. Boeing and Seller will discuss the
potential assumption [ * ] functions if Boeing [ * ].
2.2 Entire Agreement
This SBP (and all of the documents incorporated herein and made a part hereof)
sets forth the entire agreement between the Parties pertaining to the subject
matter hereof. Provided, however, that the Parties are also parties to the
following agreements which shall remain in effect: (1) Proprietary Information
Agreement effective as of May 2, 2003; (2) Proprietary Information Agreement
effective as of August 2, 2005; (3) [ * ]; (4) Electronic Commerce Trading
Partner Agreement dated as of June 14, 2003.
The Order shall be governed by and be deemed to include the provisions of this
GTA and SBP and sets forth the entire agreement, and supersedes any and all
other prior agreements, understandings and communications between Boeing and
Seller related to the subject matter of an Order. Except as provided elsewhere
herein or in the GTA, the rights and remedies afforded to Boeing and Seller
pursuant to any provisions of an Order are in addition to any other rights and
remedies afforded by law or otherwise.
2.3 Incorporated by Reference
General Terms Agreement ("GTA") [ * ] dated August 2, 2005 and effective as of
July 1, 2005 is incorporated in and made a part of this SBP by this reference.
Whenever agreed to by the Parties, an Administrative Agreement ("AA") shall be
incorporated in and made a part of this SBP.
In addition to any other documents incorporated elsewhere in this SBP or GTA by
reference, the documents set forth in Section 2.3.1 shall be incorporated in and
made a part of this SBP by reference with full force and effect, as if set out
in full text. It is Seller's responsibility to comply with the latest revision
of these documents subject to the provisions contained in Section 2.3.2.
2.3.1 Supporting Documentation and Priority
All Documents (as this term is herein defined) are by this reference
incorporated herein and made a part of this SBP subject to the requirements of
Section 2.3. For purposes of this SBP, "Document" means all specifications,
Drawings, documents, publications and other similar materials, whether in a
tangible or intangible form, as exist on the date of this Contract, which relate
to the manufacture and sale of Products or the provision of Services to Boeing
pursuant to this SBP, including, but not limited to, the Documents listed below,
and any other Documents specifically referred to in this SBP or in such other
Documents. Reference in any Document to "Contractor" or "Seller" or "Supplier"
shall mean Seller for the purposes of this SBP. In the event of any
inconsistency between the terms and conditions of this SBP and the terms and
conditions of any Document, the terms and conditions of the SBP shall control.
In the event any provisions of any Document or Documents conflict among
themselves, Boeing and Seller will jointly resolve such conflict and revise such
Document or Documents accordingly. In resolving any such conflicts, this SBP
shall be read as a whole and in a manner most likely to accomplish its purposes.
2.3.2 Revision of Documents
Subject to the terms of SBP Section 2.3, Boeing may at any time amend or revise
any Document prepared by Boeing; provided, however, that (a) Boeing shall have
supplied any such amendment or revision to Seller in writing within a reasonable
amount of time prior to its effective date, (b) Seller will implement such
amendment or revision as quickly as possible, subject to paragraph (d) below,
(c) if such change increases or decreases the cost or time required to perform
any Order, Boeing and Seller shall negotiate an equitable adjustment in the
price or schedule, or both, to reflect the increase or decrease, including the
application of any required Cost Adjustment Element as described in Attachment 1
to SBP to reasonably and fairly compensate for the effect of such amendment or
revision and (d) if Seller is unable to implement any of the amendments or
revisions Boeing and Seller will negotiate regarding such implementation, and
except that stated addresses and designees for each Party contained therein may
be modified unilaterally by such Party, and any modification of any Document
executed by Seller must be reflected promptly therein by amendment thereto.
2.3.3 Compliance
Seller shall, subject to the terms of this SBP Section 2.3, promptly comply with
the provisions of all Documents, including any revisions subject to SBP Section
2.3.2 thereto.
2.3.4 List of Certain Documents
[ * ]
2.4 Order of Precedence
In the event of a conflict or inconsistency between any of the terms of the
following Documents, the following order of precedence shall control:
A. [ * ]
B. [ * ]
C. [ * ]
D. [ * ]
E. [ * ]
F. [ * ]
G. [ * ]
H. [ * ]
I. [ * ].
In resolving any such conflicts, these documents shall be read as a whole and in
a manner most likely to accomplish their purposes.
Each Party shall promptly report to the other Party in writing any
inconsistencies discovered in these Documents, even if the inconsistency is
resolvable using the above rules.
2.5 Survival
Without limiting any other survival provision contained herein and
notwithstanding any other provision of this SBP or the GTA to the contrary, the
representations, covenants, agreements and obligations of the Parties set forth
in GTA Section 8.5 "Retention of Records", GTA Section 12.3 "Seller's Claim",
GTA Section 16.0 "Termination or Wrongful Cancellation", GTA Section 18.0
"Responsibility for Property", GTA Section 20.0 ` Proprietary Information and
Items", GTA Section 24.0 "Boeing's Rights in Seller's Patents, Copyrights, Trade
Secrets and Tooling", GTA Section 27.0 "Property Insurance", GTA Section 29.0
"Non-Waiver/Partial Invalidity", this SBP Section 2.5 "Survival", SBP Section
5.0 "Applicable Law", SBP Section 29.0 "On-Site Support"(if applicable), and SBP
Section 43.0 "Supplements and Modifications"(if applicable), shall survive any
cancellation, termination or expiration of this SBP, any assignment of this SBP
or any payment and performance of any or all of the other obligations of the
Parties hereunder. Termination or cancellation of any part of this SBP shall not
alter or affect any part of this SBP that has not been terminated or cancelled.
3.0 PERIOD OF PERFORMANCE AND PRICES
3.1 Performance
3.1.1 Period of Performance
The period of performance for this SBP shall be from the effective date
identified in the first paragraph of this SBP and ending December 31, 2010.
3.1.2 Extension of Contract
Seller and Boeing may extend the period of performance of this SBP by mutual
written agreement of both parties. Boeing and Seller shall endeavor to reach any
such agreement regarding extension no later than [ * ].
Notwithstanding the provisions herein, each Party reserves the right to commence
new negotiations with the other Party concerning pricing and other terms for
additional quantities of Products.
3.2 Pricing
3.2.1 Product Pricing
The Prices of Products ordered and scheduled for delivery under this SBP on or
after [ * ] are set forth in SBP Attachment 1. Prices are in United States
Dollars.
A list of Seller's traditional shipping locations is included as Attachment 22.
[ * ]
In addition, when the Products will be imported into the United States by way of
aircraft, the Seller has the responsibility of requiring, and ensuring, that the
forwarder/carrier provide, via email, a pre-alert and confirmed on-board
notification to Boeing's contracted broker no less than [ * ] prior to the
shipment's leaving the port of export. The pre-alert must include a copy of the
completed commercial invoice, the airway bill, flight details, and confirmed
on-board information. For identification of Boeing's contracted broker contact
Boeing Traffic at http://www.boeing.com/companyoffices/doingbiz/flash.html.
3.2.2 Manufacturing Configuration
Unit pricing for each Product or part number shown in SBP Attachment 1 is based
on the latest revisions of the Specifications at the time of the signing of this
SBP and any amendments thereof, subject to GTA Section 10.
3.2.3 Packaging
The Prices shown in SBP Attachment 1 include all normal and reasonable packaging
costs (normal and reasonable packaging is further described in GTA Section 7).
For export shipments or shipments requiring packaging in excess of normal
packaging, Boeing shall pay for such additional packaging charges. Seller shall
package Product in accordance with the applicable requirements set forth in the
GTA for the location issuing the Order, as appropriate. Upon Boeing's request,
Seller will provide discreet packaging costs.
3.2.4 Local Transportation Devices
Not Applicable.
3.3 Subject Matter of Sale
Subject to the provisions of this SBP, Seller shall sell to Boeing and Boeing
shall purchase from Seller certain Products as set forth in SBP Attachment 1.
Such Products are intended for use by Boeing for the [ * ]. Such Products may be
[ * ].
3.3.1 Nonrecurring Work
3.3.1.1 Tooling - General
Not Applicable.
3.3.1.2 Static and Fatigue Test Articles
Not Applicable.
3.3.1.3 Contractor-Use Tooling (also known as Seller-Use Tooling)
Not Applicable.
3.3.1.4 Common - Use Tooling
Not Applicable.
3.3.1.5 Use of Casting, Forging and Extrusion Tools
Not Applicable.
3.3.1.6 Initial Planning
Not Applicable.
3.3.1.7 Weight Status Reporting
Not Applicable.
3.3.1.8 Integrated Product Team
Seller shall participate and/or locate at Boeing's facilities key personnel for
Integrated Product Teams as requested by Boeing.
3.4 Type Design and Type Certification Data Development and Protection
Not Applicable.
3.5 Seller Authorized Representative (AR) Requirements and Obligations
Not Applicable.
4.0 GOVERNING QUALITY ASSURANCE REQUIREMENTS
In addition to those general quality assurance requirements set forth in the
GTA, the work performed under this SBP shall be in accordance with the
requirements set forth in SBP Attachment 10.
4.1 Seller Authorized Representative (AR) Requirements and Obligations
Not Applicable.
5.0 APPLICABLE LAW
This Contract shall be governed by the laws of the State of Washington. No
consideration shall be given to Washington's conflict of law rules. This
Contract excludes the application of the 1980 United Nations Convention on
Contracts for the International Sale of Goods. Seller hereby irrevocably
consents to and submits itself to the jurisdiction of the applicable courts of
King County Washington and the federal courts of Washington State for the
purpose of any suit, action or other judicial proceeding arising out of or
connected with any Order or the performance or subject matter thereof. Seller
hereby waives and agrees not to assert by way of motion, as a defense, or
otherwise, in any such suit, action or proceeding, any claim that (a) Seller is
not personally subject to the jurisdiction of the above-named courts, (b) the
suit, action or proceeding is brought in an inconvenient forum or (c) the venue
of the suit, action or proceeding is improper.
6.0 PRODUCT SUPPORT AND ASSURANCE; ON TIME DELIVERY
6.1 Warranty
With respect to each Product purchased by Boeing and delivered by Seller, Seller
warrants to Boeing that [ * ].
Unless otherwise agreed to by Boeing, Products delivered under an Order shall be
subject to [ * ]. If Boeing performs an inspection or test on the premises of
Seller or its subcontractor, Seller shall furnish, and shall require its
subcontractor to furnish, without additional charge, reasonable facilities and
assistance for safe and convenient performance of these duties.
6.1.1 Claim Against Seller
Any claim against Seller for breach of the warranties set forth in this Section
6.1 shall be made in writing no later than [ * ] after delivery of such Product
by Seller, after which time any such claim shall be deemed waived and barred.
6.1.2 Implied Warranty
[ * ]
6.1.3 Permitted Assignees
This warranty shall run to Boeing, its successors, and their permitted
assignees. Products required to be repaired, corrected or replaced shall be
subject to this SBP Section 6.1 and GTA Section 8.3 "Boeing's Inspection and
Rejection" in the same manner and to the same extent as Products originally
delivered under this SBP, but only as to the repaired, corrected or replaced
part or parts thereof. Even if the Parties disagree about the existence of a
breach of this warranty, Seller shall promptly comply with Boeing's direction
to: [ * ] If the Parties later determine that Seller did not breach this
warranty, the Parties shall equitably adjust the invoiced amounts.
6.2 Integrated Materials Management (IMM) Program
If requested by Boeing, Seller shall, as may be applicable for a materials
supplier, participate in and support Boeing's Integrated Materials Management
(IMM) Program pursuant to terms and conditions mutually agreed upon in writing
by the Parties that will achieve an efficient and low cost supply chain
infrastructure pursuant to the goals and strategies of the IMM Program as set
forth below:
A. Provide a Boeing integrated solution for customers' material
management operations;
B. Provide guaranteed service levels to customers' maintenance
operations;
C. Reduce inventory and process costs with better service levels
to customers;
D. Enable supply chain and customers to reduce costs and share
benefits.
IMM on-site functions may be located at customers' facilities and may include,
demand planning, inventory management, repair and overhaul services and
replenishment management. IMM global functions may include, planning and
collaboration, global operations, systems integration, network supplier
management, global logistics management, quality assurance, human resources,
parts/services engineering, finance and accounting, communications, product
development. 6.3 ON-TIME DELIVERY
6.3.1 Definitions
For the purposes of this Section 6.3, "On-Time" delivery by Seller for the
period from the effective date of the Contract up to and including [ * ] shall
be defined as Seller having conforming Product available to ship from a period
beginning [ * ].
"On-Time Delivery Rate" means, for a given [ * ], the [ * ]. This rate is
expressed as a percentage.
"Quality Performance Rate" means for a given [ * ] the [ * ]. This rate is
expressed as a percentage.
6.3.2 On-Time and Delivery Targets and Material Default in Performance from [
* ] through [ * ].
From [ * ] through [ * ], Seller shall strive at all times for an On-Time
Delivery Rate of not less than [ * ] in each [ * ] and a Quality Performance
Rate of not less than [ * ] in each [ * ].
However, for purposes of GTA Section 13.4, a "Material Default in Performance"
by Seller for the period from [ * ] through [ * ] shall be deemed to occur when
either (a) the On-Time Delivery Rate for any given [ * ] is less than [ * ] or
(b) the Quality Performance Rate for any given [ * ] is less than [ * ].
6.3.3 On-Time and Delivery Targets and Material Default in Performance from [
* ] through [ * ].
From [ * ] through [ * ], for any given [ * ] Seller's performance with regard
to its on-time delivery and quality performance shall be measured in accordance
with the following criteria:
OTD Performance Quality Performance
[ * ]
However, for purposes of GTA Section 13.4, a "Material Default in Performance"
by Seller for the period from [ * ] through [ * ] shall be deemed to occur when
either (a) the On-Time Delivery Rate for any given [ * ] is less than [ * ] or
(b) the Quality Performance Rate for any given [ * ] is less than [ * ].
Provided, however, that Boeing and Seller agree to engage in good faith
negotiations regarding the use of [ * ] as the metric for calculating the
On-Time Delivery Rate as well as the calculation of such rate on a quarterly (as
opposed to rolling) basis, and the use of [ * ] as the metric for calculating
Quality Performance Rate as well as the calculation of such rate on a quarterly
(as opposed to rolling) basis, with a view that the Parties would endeavor to
reach mutual agreement on any acceptable changes to these requirements by [ * ]
which changes would then become effective [ * ].
6.3.4 Seller Implementation of Additional Measures by Product Group to Ensure
On-Time Performance
6.3.4.1 If during the period from [ * ] through [ * ] Seller's On-Time Delivery
Rate for any specific Product group(s) falls below [ * ] for any given
calendar quarter, Seller and Boeing shall set up a cross-functional
team to establish milestones to address the root cause(s) of the
unsatisfactory On-Time Delivery Rate within [ * ] following the end of
the calendar quarter in which Seller's On-Time delivery Rate for any
Product group(s) falls below [ * ]. If Seller thereafter fails to reach
any of the established milestones, Seller will [ * ] within a mutually
agreeable time frame and will [ * ] in place until Seller's On-Time
Delivery Rate for such Product group(s) is at least [ * ] for [ * ]
(without relying on [ * ]).
7.0 PAYMENT
7.1 Recurring Price
Unless otherwise provided under the applicable Order or written agreement
between the Parties, payment shall be [ * ]. All payments shall be in United
States Dollars. Except as otherwise provided on an applicable Order identifying
Pay-From Receipt, payment due dates, including discount periods, shall be
computed from the later of (a) the invoice date for the Product or (b) the date
of receipt of a correct (proper) invoice. Any discount shall not apply to
freight or other specified charges. All payments are subject to adjustment for
shortages, credits and rejections. A discount of [ * ] of the invoiced amount
shall apply to all cash payments made within [ * ] of the invoice date.
Boeing may dispute payment amounts due, provided that Boeing provides a complete
reason as to the dispute. Once a dispute has been resolved, payment terms will
be [ * ] from the date of resolution.
In the event Boeing fails to make payments when due, Seller reserves the right
to assert whatever remedies it may have under law.
7.2 Nonrecurring Price/Special Charges
Not applicable.
7.3 Payment Method
All payments hereunder shall be made by Boeing through Seller's automated
payment system.
7.4 Payment Errors
If an error in payment (over payment or under payment) is discovered by Boeing
or Seller, a written notification will be submitted to the other Party and
resolution of the error will occur in a timely manner after discovery of such
error.
7.5 Credit for Certain Orders
Seller shall credit Boeing [ * ] for all Product ordered by Boeing hereunder and
originally scheduled for delivery by Seller through [ * ].
8.0 SCHEDULE ACCELERATION/DECELERATION
In addition to Boeing's right to direct a change in quantity or schedule under
GTA Section 10.0, upon receipt of written notification from Boeing's Procurement
Representative of Boeing's desire to increase its quantity or accelerate
schedule requirements ("Acceleration Request") and/or decrease its quantity or
decelerate schedule requirements by canceling all or any part of an Order or
push out the delivery date(s) specified on any Order ("Deceleration Request");
(a) In the event of an Acceleration Request, Boeing shall provide written
notification to Seller specifying all demand and prioritization information.
Seller shall provide, in cooperation with Boeing, a formal proposal specifying
the manner and extent to which Seller can address Boeing's demand requirements
and enumerating the anticipated additional costs resulting from various action
proposals that may be made by Seller. Based on Boeing's feedback Seller will
develop a milestone chart, implement the agreed upon action proposal and provide
ongoing status reports.
(b) In the event of a Deceleration Request, Boeing shall provide to Seller
written notification of any anticipated deceleration as soon as possible prior
to the effectiveness of the deceleration request. Seller shall, at no added cost
to Boeing, accept the cancellation of all or any part of an Order or permit
Boeing to push-out the delivery dates on Orders, with respect only to Orders for
which the delivery dates are later than the then-effective manufacturing
lead-times described in SBP Section 12.5.
Provided, however, that Seller's obligations under this SBP Section 8.0 shall be
limited to circumstances in which Boeing experiences "significant and sudden"
changes to its program(s) build rates and/or model/fleet specific program.
9.0 NOTICES
9.1 Addresses
For all matters requiring the approval or consent of either Party, such approval
or consent shall be requested in writing and is not effective until given in
writing. Notices shall be deemed delivered (a) on the business day when
personally delivered or when received by e-mail, (b) one (1) business day after
deposit with a recognized overnight business delivery service, or (c) on the
business day when sent by verified facsimile to the facsimile number provided in
this Section 9.1, with original forwarded by recognized overnight business
delivery service. Notices and other communications shall be given in writing by
personal delivery, recognized overnight business delivery service, facsimile, or
electronic transmission addressed to the respective party as follows:
To Boeing: Attention: Michael S. Carr Mail Code: 05-16
BOEING COMMERCIAL AIRPLANES
GLOBAL PARTNERS
P.O. Box 3707
Seattle, Washington 98124-2207
E-mail: Michael.s.carr@boeing.com
Facsimile: (425) 294-6330
To Seller: Attention: Chris Boland
Titanium Metals Corporation
900 Hemlock Road
Morgantown, PA. 19543
E-mail: Chris.Boland@TIMET.com
Facsimile: (610) 286-3839
And:
Attention: Derek George
Titanium Metals Corporation
3907 S.W. 328th St
Federal Way, WA 98023
E-mail: Derek.George@TIMET.com
Facsimile: (253) 661-6424
Any Party may change its address or facsimile number by giving notice to the
others in accordance with the provisions of this Section 9.1.
10.0 OBLIGATION TO PURCHASE AND SELL/VOLUME AND SHARE/ REMEDIES
Boeing agrees to purchase from Seller and Seller agrees to supply to Boeing the
Products, on the terms and subject to the conditions contained in the Contract.
A. Boeing and Seller agree that in consideration of the prices set
forth under SBP Attachment 1 and all of the other terms and conditions of this
SBP, Boeing shall purchase and Seller shall supply a minimum [ * ] each calendar
year from [ * ] through [ * ] ("Boeing Minimum Volume"). The Boeing Minimum
Volume may increase as set forth in Section 10.0.F.2 below.
B. Boeing currently estimates that calendar year purchases from Seller
will be as follows:
[ * ]
C. Seller's supply obligation will be [ * ] of Product for [ * ],
notwithstanding the provisions of Section 10.E or 10.F.
D. Seller's obligation to supply the annual volumes of Product
indicated is conditioned upon Boeing's providing to Seller reasonably accurate
forecasting on the basis described in Section 12.5. In addition, Seller shall
not be obligated to accept any Order which:
1. [ * ] set forth herein;
2. Contains a [ * ]. Seller will consult with Boeing in the
event it receives such an Order and is unable to resolve [ * ] and, if
appropriate, [ * ]. Seller will use [ * ] by Boeing;
3. Is [ * ]
4. Is for [ * ];
5. Is for [ * ]; or
6. Is for [ * ].
E. Except as provided in Section 10.0.F, Boeing may not increase its
purchased volume (and Seller's corresponding supply obligation) of Product by
more than [ * ].
F. Boeing's purchased volume (and Seller's corresponding supply
obligation) of Product may increase by more than the [ * ]) provided that Boeing
gives Seller [ * ] advance written notice of its plan for such increase,
specifying the absolute volume desired.
1. For example, in order to increase projected volume of Product
for [ * ] to a level more than [ * ] level, Boeing would have
to give written notice to Seller by [ * ].
2. For any calendar year in which Boeing notifies Seller that the
projected increase in Boeing's volume of Product would exceed
the permitted [ * ], the amount by which the projected volume
exceeds the permitted [ * ] will be added to the
then-effective Boeing Minimum Volume and the sum of the two
will become the new Boeing Minimum Volume for that calendar
year.
3. Notwithstanding the foregoing, Boeing's purchased volume may
increase at a greater [ * ] than otherwise allowed in SBP
Section 10.0.F if such increase would be necessary in order
for Boeing to purchase the Boeing Minimum Volume under Section
10.0.A.
G. Boeing shall purchase a minimum volume of titanium mill products
(vs. ingot or other melted titanium product) each calendar year (the "Mill
Products Minimum") which volume shall be included in the Boeing Minimum Volume.
The Mill Products Minimum for a given calendar year will be calculated based on
Boeing's total purchased volume of Product that calendar year ("Annual Volume"),
as set forth in the following table:
[ * ].
H. Volume of Product purchased by Boeing [ * ] will not be counted
toward satisfaction of Boeing's Mill Products Minimum purchase requirement in
Section 10.0.G, but will be counted toward satisfaction of the Boeing Minimum
Volume.
I. In the event that Boeing does not purchase at least [ * ], Boeing
will compensate Seller [ * ].
J. In addition, in the event that Boeing does not purchase at least [ *
], Boeing will compensate Seller [ * ].
K. Seller shall provide Boeing with all information relevant to [ * ]
claim under Sections 10.0.I or 10.0.J for a [ * ] by [ * ] of the [ * ]. The
Parties shall agree upon the amount of [ * ] due and payable by Boeing to Seller
by [ * ]. Boeing shall satisfy its obligation to Seller for [ * ] no later than
[ * ] calendar days after [ * ] either by a [ * ] or, [ * ].
Boeing shall satisfy all [ * ] claim amounts by [ * ] after [ * ] in the manner
described above. If any [ * ] amounts remain in dispute by [ * ], the Parties
shall target to resolve all outstanding disputes regarding Seller's [ * ] claims
on or before [ * ] ("Resolution Date") [ * ]. Boeing shall then satisfy all
resolved [ * ] claims ("Resolved [ * ] Claim") by [ * ] after the Resolution
Date, subject to a late payment charge on the Resolved [ * ] Claim computed over
the period from [ * ] until the Resolution Date, using the [ * ] publicly
announced by [ * ], as its [ * ] in effect [ * ] and using the following
formula:
[ * ]
Any amounts that remain disputed after the Resolution Date shall be [ * ].
Late [ * ] Payments: Amounts determined to be due by the procedures outlined
above that are not paid when due will also be subject to a late charge on the
amount due computed over the period beginning on the date the payment is due and
ending on the payment date calculated in the manner described in the formula
above.
L. The [ * ] in Section 10.0.I for failure to [ * ] and the [ * ] in
Section 10.0.J for failure to [ * ] are [ * ] within a given [ * ]. For example,
if in a given [ * ] Boeing purchased [ * ] and [ * ], Boeing would be obligated
to pay Seller in [ * ] (in accordance with the provisions of Section 10.0.K) in
an amount equal to [ * ]. Assume a [ * ] and a [ * ] (under Section 10.0.G). For
the reflected [ * ] shown below, the applicable [ * ] under Sections 10.0.I and
10.0.J are shown on the right.
[ * ]
M. Boeing and Seller agree to discuss establishing a [ * ].
N. Boeing will use commercially reasonable efforts to provide Seller
with a diversified statement of work across all Boeing commercial production
programs.
O. Beginning in [ * ], Boeing will use commercially reasonable efforts
to order from Seller and Seller will use commercially reasonable efforts to
supply to Boeing on an annual basis, a mix of titanium mill products consistent
with the following target mix [ * ]:
[ * ]
P. Seller will provide Boeing with an appropriate business case
(including minimum volumes requested and titanium scrap mix) to support the
potential award to Seller of Orders for [ * ] Product. Based on Seller's
business case, Boeing will determine the volume of [ * ] that may be awarded to
Seller and the applicable commercial aircraft production programs to which such
awards will relate.
Q. Mill Minimums - Minimum Order Volumes
1. A list of Seller's "standard stocked items" is provided as
Attachment 21 to this SBP. Boeing agrees that for all Orders
other than for standard stocked items, the Order volume must
be at least [ * ] set forth in the table below:
[ * ]
* Nominal weight
2. Seller shall not be obligated to accept any offer for an Order
for a standard stocked item for which the Order [ * ] is less
than [ * ].
3. If Boeing desires to order less than the [ * ] of a Product
other than a standard stocked item, Seller elects not to
accept such offer for an Order, and Boeing thereafter chooses
to purchase such item from a third-party supplier, Boeing will
receive [ * ]; provided, however, that the maximum credit
Boeing may receive in such cases in any calendar year for such
third-party purchases is [ * ].
4. In the event Boeing is unable to secure the item from a
third-party supplier, Boeing may require Seller to supply such
Product. In such case Seller will manufacture the [ * ]. Any
portion of such [ * ] or, at Boeing's election, [ * ] (based
upon the then-current Indicator Index for scrap--see Section
1.03.B. of Attachment 1). Boeing may not require Seller to
produce more than [ * ] under this Section 10.0.Q.4 in any
calendar year.
5. Seller agrees to review the [ * ] limits set forth in Sections
10.0.Q.3 and 10.0.Q.4 on an annual basis to assure they
continue to be reasonable.
R. Calculation of Purchased Volumes
1. Product shall be deemed to have been purchased in the [ * ]
under an Order, provided that if [ * ]; provided, that, if
payment for any Product ordered by Boeing is not subsequently
made by Boeing, [ * ]; and provided further, that [ * ];
2. Product with respect to which an Order is terminated in
accordance with Section 12.0 of the GTA shall be counted only
in an amount equal to the relevant Order volume (in pounds)
times the percentage of applicable Price actually paid as a
termination charge in accordance with Section 12.3 of the GTA;
and
3. Any substitute titanium product purchased by Boeing pursuant
to Section 13.2.B of the GTA upon the occurrence of a Seller
Event of Default/non-performance under an Order (as defined in
Section 13.1 of the GTA) or any Product that Boeing purchases
from a third party because Seller is unable to supply such
Product shall be counted as though such volume (in pounds) had
actually been purchased by Boeing from Seller pursuant to the
Contract in the calendar quarter in which Seller should have
made delivery thereof provided Seller has been furnished with
written notice of such event.
S. For purposes of this SBP Section 10.0, Boeing is defined [ * ].
11.0 COST PERFORMANCE VISIBILITY
Consistent with the limitations identified in GTA Section 9.0, when requested by
Boeing, Seller shall provide all necessary cost support data, source documents
for direct and indirect costs, and assistance at the Seller's facility in
support of cost and performance reviews performed by the Parties pursuant to
cost reduction initiatives as set forth in SBP Section 12.6.
The Cost Performance Review (CPR) process is the tool which the Parties will use
to measure Seller's performance against the goals and objectives of Boeing as
set forth in SBP Section 12.6. Boeing and Seller shall implement a structured
process called CPR to review and identify areas, processes and strategies to
reduce or eliminate costs for the Product(s) set forth in this SBP. The CPR
process will address those activities which are a direct result of both Parties'
involvement. Seller will use commercially reasonable efforts to provide the
resources and data sufficient to support the CPR process in accordance with the
structure set forth in SBP Attachment 9.
12.0 CHANGE PROVISIONS
12.1 Reserved.
12.2 Computation of Equitable Adjustment
Not Applicable.
12.3 Obsolescence
Seller may not submit a claim for obsolete material or Product in its possession
resulting from an individual change order or termination that has a total claim
value of [ * ] or less.
12.4 Change Absorption (Nonrecurring/Recurring)
Not Applicable.
12.5 Planning Schedule/Forecasting
By [ * ] of each year, Boeing will provide Seller with an annual forecast of
Boeing's projected needs for Product during the [ * ] ("[ * ] Forecast"). Within
[ * ] after receiving the [ * ] Forecast, Seller will provide Boeing with [ * ]
based on the [ * ] Forecast. The [ * ] purposes for Product to be delivered in
the following year. Once issued, [ * ] will not be changed [ * ].
A. No later than [ * ], Boeing will provide Seller with a
rolling forecast [ * ] ("[ * ]Forecast"). (For example, the [ * ]
forecast date will include forecasted volumes for the [ * ].) Within [
* ] of Seller's receipt of each [ * ] Forecast, Seller will provide
Boeing [ * ] for Product based on Seller's [ * ]. [ * ] will be subject
to change from time-to-time, but will not exceed the applicable [ * ]
for such year for the same titanium product.
B. In the event that the [ * ] Forecast changes from one [ * ]
Forecast to the next by more than [ * ], Seller reserves the right to
adjust both the associated protected re-order lead times and
manufacturing lead-times for that portion of the forecast increase that
is in excess of the permitted [ * ].
C. Boeing and Seller will work together within the [ * ]
period commencing on the execution date of the Contract to implement a
process for developing accurate forecasts.
D. In the event that Boeing's actual purchases for a given [ *
] differ from the most recent [ * ] Forecast for that same [ * ] by
more than [ * ], Seller reserves the right to adjust both protected [ *
] and [ * ] in its discretion.
E. Provided Boeing complies with all material terms of the
Contract, Seller will offer to Boeing [ * ] that will be at least
comparable to those of [ * ].
12.6 Total Cost Management/Lean Manufacturing Process Improvement
A. Total Cost Management Boeing and Seller agree to
participate in a process herein known as Total Cost Management (TCM).
Boeing and Seller may each identify cost reduction opportunities which
shall be documented in a mutual written agreement, and shall use
commercially reasonable efforts to work together for implementation.
Boeing and Seller shall review TCM opportunities on a periodic basis,
which shall include the establishment of targets and implementation
plans by specific written agreement of the Parties. Where Boeing and
Seller identify TCM cost reductions, beyond those previously
anticipated, identified and documented and reflected in the
then-applicable Price for the Products, the Parties will determine the
amount of savings that will result from the improvements and share the
savings on a basis that is weighted to the "owner" of the savings, net
of development and implementation costs. All such programs will be
covered by separate written agreements between the Parties. Seller
suggestions disapproved by Boeing may be given consideration in
achievement of TCM targets.
B. Boeing Generated Technical and Cost Improvement
At any time during the Seller's performance under this SBP, Boeing may
offer specific recommendations to Seller for the incorporation of any
new technologies and process improvements intended to reduce Seller's
costs or improve Product performance. These recommendations may
include, but are not limited to, Boeing proprietary information and
Boeing owned patents. Notwithstanding any other provision(s) contained
elsewhere in this SBP, if Seller has agreed to and implemented Boeing's
recommendations and a cost savings is identified and documented as
resulting therefrom, the Parties agree that if such savings was not
previously anticipated, identified and documented and reflected in the
then-applicable Price for the Products, the Parties will determine the
amount of savings that has resulted from the improvements and share the
savings on a basis that is weighted to the "owner" of the savings, net
of development and implementation costs. All such programs will be
covered by separate written agreements between the Parties. And
provided, further, that any such recommendations made by Boeing and
agreed to by Seller shall not modify any other provisions in this SBP
unless expressly agreed to in writing by both Parties.
C. Lean Manufacturing/Process Improvement
With respect to any cost savings that result from any continuous
improvement processes (such as lean manufacturing, SPC, preventative
maintenance) that are agreed to in writing by the Parties and
implemented with a view to achieving annual TCM cost reductions, if
such savings was not previously anticipated, identified and documented
and reflected in the then-applicable Price for the Products, such
savings would be shared on a reciprocal basis weighted to the "owner"
of the savings, net of development implementation costs. Seller and
Boeing will identify programs and/or areas where costs may be reduced,
agree in writing upon each such program to be implemented and on the
baseline price/cost level against which each price/cost element shall
be measured. All such programs will be covered by separate written
agreements between the Parties.
D. Cooperation on Research and Development Initiatives
The Parties shall explore opportunities to work together on research
and development programs that have been established by separate written
agreements between the Parties. Such cooperation would be expected to
include regular exchanges of pertinent information determined by each
Party to be appropriate for such cooperative exchange.
12.7 Reserved.
12.8 Reserved.
12.9 Derivative Aircraft
Not Applicable.
13.0 SPARES AND OTHER PRICING
13.1 Spares
For purposes of SBP Section 13.0, the following requirements and
definitions shall apply:
A. AIRCRAFT ON GROUND (AOG) - means the highest Spares priority.
Seller will expend best efforts to provide the earliest
possible shipment of any Spare designated AOG by Boeing. Such
effort includes but is not limited to working twenty-four (24)
hours a day, seven days a week and use of premium
transportation. Provided, however, that all additional costs,
if any, incurred by Seller as a result of such prioritization
requests from Boeing shall be paid by Boeing. Seller shall
contact Boeing upon receipt of any AOG Spare request to
confirm the accuracy and priority of the request. Seller shall
provide Boeing with the anticipated additional cost, if any,
associated with complying with the AOG Spare request and shall
use best efforts to specify the delivery date of any such AOG
Spare within [ * ] of receipt of an AOG Spare request. Seller
shall only proceed to take action upon such AOG Spare request
after receiving written direction from Boeing to proceed.
B. DEMAND DATE - means a date provided to Seller by Boeing when
Boeing wants the Product(s) on-dock. Seller will use best
efforts to provide a commitment to Boeing no later than [ * ]
from notification of demand date.
C. SELLER'S FULL MANUFACTURING LEADTIME SPARE - means a Spare in
which the Demand Date is equal to or greater than Seller's
normal manufacturing lead-time or the Demand Date is less than
Seller's normal manufacturing lead-time but Seller's best
effort commitment is Seller's normal manufacturing lead-time.
D. SELLER'S LESS THAN FULL MANUFACTURING LEADTIME SPARE - means a
Spare in which the Demand Date is less than Seller's normal
manufacturing lead-time and Seller's best effort commitment to
meet the Demand Date is less than Seller's normal
manufacturing lead-time
E. PURCHASED ON ASSEMBLY REQUIREMENT (POA) - Not Applicable.
F. IN-PRODUCTION SPARE - means any Spare which is in the current
engineering configuration for the Product and is used on a
model aircraft currently being manufactured by Boeing at the
time of the Order.
G. NON-PRODUCTION SPARE - means any Spare which is used on model
aircraft no longer being manufactured by Boeing (Post
Production) or is in a non-current engineering configuration
for the Product (Out of Production).
H. BOEING PROPRIETARY SPARE - means any Spare, which is
manufactured (i) by Boeing, or (ii) to Boeing's detailed
designs with Boeing's authorization or (iii) in whole or in
part using Boeing's Proprietary Materials.
13.1.1 Spares Support
The Demand Date initiative is Boeing's means of providing Seller greater
visibility of Customer requirements and expectations for Spares. Seller agrees
to work with Boeing during the term of this SBP to identify and address those
elements in the manufacturing or support processes which are critical to
supporting the Demand Date initiative. Where possible, the Parties will work to
improve those critical elements.
Seller shall provide Boeing with the name and number of a twenty-four (24) hour
contact for coordination of AOG requirements. Such contact shall be equivalent
to the coverage provided by Boeing to its Customers as outlined in SBP
Attachment 4 "Boeing AOG Coverage".
Seller shall notify Boeing as soon as possible via fax, telecon, or as otherwise
agreed to by the Parties of each AOG requirement shipment using the form
identified in SBP Attachment 5 "Boeing AOG Shipping Notification". Such
notification shall include time and date shipped, quantity shipped, Order, pack
slip, method of transportation and air bill if applicable. Seller shall also
notify Boeing immediately upon the discovery of any delays in shipment of any
requirement and identify the earliest revised shipment possible.
13.1.2 Reclassification or Re-exercises
Boeing may instruct Seller to re-prioritize or reclassify an existing
requirement in order to improve or otherwise change the established shipping
schedule. Seller shall use best efforts to meet the revised requirement as set
forth above in the definitions of the requirements, subject to Boeing's
responsibility for all additional costs, if any, caused thereby. Seller's
commitment of a delivery schedule shall be given in accordance with that set
forth above for the applicable classification but in no case shall it exceed [ *
] from notification by Boeing.
13.1.3 Spare Pricing
Except as set forth in SBP subsections 13.1.3.1 and 13.1.3.2 below and subject
to Boeing's responsibility for all additional costs, if any, resulting from an
AOG Spare request, the price for Boeing Proprietary Spare(s) shall be the same
as the production price for the Products as listed on SBP Attachment 1, in
effect at the time the Spare(s) are ordered.
13.1.3.1 Aircraft on Ground (AOG) Requirement
The price for AOG requirements shall be the Price for such Products listed on
SBP Attachment 1 in effect when such Spares are ordered, subject to Boeing's
responsibility for all additional costs, if any, resulting from an AOG Spare
request.
13.1.3.2 Seller's Less Than [ * ] Spare
The price for Seller's less than [ * ] Spare shall be the Price for such
Products listed on SBP Attachment 1 in effect when such Spares are ordered,
subject to Boeing's responsibility for all additional costs, if any, resulting
from an AOG Spare request.
13.1.4 Spares Special Handling
The price for all effort associated with the handling of Spare(s) is deemed to
be included in the Price for such Spare(s), except where the effort with the
handling of Spare(s) exceeds what would have occurred absent the AOG Spares
request, and such additional effort will be subject to Boeing's responsibility
for all additional costs, if any, resulting from an AOG Spare request. If Boeing
directs delivery of Spares to a place other than that designated in SBP Section
3.2.1, Boeing shall reimburse Seller for shipping charges, including insurance,
paid by Seller to the designated place of delivery which exceed the original
cost of shipping contemplated in this SBP. Such charges shall be shown
separately on all invoices.
13.2 Expedite of Production Requirements
Any expedite charges to be paid for short flow production requirements shall be
pre-approved by the Procurement Representative. Seller shall provide data to
verify expedite charges. If Seller fails to meet their committed delivery,
Boeing shall not be obligated to pay the agreed upon amount.
13.3 Tooling
13.3.1 Responsible Party
Not Applicable
13.3.2 Boeing Furnished Tooling
Not Applicable
13.3.3 Additional Tooling Requirement
Not Applicable
13.3.3.1 Title to Tooling
Not Applicable
13.3.3.2 Use and Disposition of Tooling
Not Applicable
13.3.3.3 Accountability for Tooling
Not Applicable
13.3.3.4 Certified Tool Lists
Not Applicable
13.4 Pricing of Boeing's Supporting Requirements
Any Products required to assist Boeing's supporting requirements, including but
not limited to, test requirements, factory support, will be provided for not
more than the applicable Price as set forth in SBP Attachment 1, subject to
Boeing's responsibility for all additional costs, if any, resulting from a Spare
request.
13.5 Pricing of Requirements for Modification or Retrofit
13.5.1 Boeing Responsibility or Regulatory Requirement
Any Products required by Boeing to support a modification or retrofit program
which results from a regulatory requirement or which Boeing may be liable for
the cost associated with such program shall be provided to Boeing at a price not
more than the applicable Price as set forth in SBP Attachment 1, subject to
Boeing's responsibility for all additional costs, if any, resulting from a Spare
request.
13.5.2 Contract Aftermarket Modification or Retrofit Work Performed by Boeing
Any Products required by Boeing to support modification or retrofit programs,
which Boeing performs under contract, shall be provided for not more than the
applicable Price as set forth in SBP Attachment 1, subject to Boeing's
responsibility for all additional costs, if any, resulting from a Spare request.
13.6 Pricing of Similar Products
Should Boeing desire to order from Seller a titanium product not identified on
Attachment 1, the Parties will confer and, assuming Seller is able and desires
to supply such non-listed product, will negotiate the pricing for such
non-listed product, generally following a consistent methodology for
establishing new product pricing as is applied by Seller in establishing its
pricing for new products. Any such agreement will be evidence by an amended
Attachment 1.
14.0 STATUS REPORTS/REVIEWS
14.1 General Reports / Reviews
When requested by Boeing, Seller shall update and submit, at a minimum, monthly
status reports or data requested by Boeing using a method mutually agreed upon
by Boeing and Seller. Boeing has the right to impose more frequent reporting on
Seller to achieve program objectives.
When requested by Boeing, Seller shall provide to Boeing a manufacturing
milestone chart identifying the major purchasing, planning and manufacturing
operations for the applicable Product(s).
Program reviews will be held at Seller's facility or Boeing's facilities as
reasonably requested by Boeing. The topics of these reviews may include raw
material status, manufacturing status, production status, Seller's current and
future capacity assessments, inventory, Boeing's requirements, changes,
forecasts and other issues pertinent to Seller's performance under this SBP.
Reviews will allow formal presentations and discussion of status reports as set
forth above.
14.2 Diversity Reporting
Not Applicable.
14.3 Program Manager
Seller will assign one or more persons to perform program manager
responsibilities to oversee and manage Seller's and Boeing's performance
hereunder.
14.4 Certified Tool List
Not Applicable.
14.5 Problem Reports
Seller shall provide a detailed report notifying Boeing of program
problems/issues that could impact Seller's ability to deliver Products on time
and otherwise in conformance with the terms of the GTA and SBP. The report shall
contain a detailed description of the problem, impact on the program or affected
tasks, and corrective/remedial action, with a recovery schedule. Submittal of a
report in no way relieves Seller of any obligations under the GTA and SBP nor
does it constitute a waiver of any rights and remedies Boeing may have with
respect to any default.
Problem reports shall be submitted to the Boeing Procurement Representative on a
weekly basis. In special circumstances, Seller will notify Boeing promptly of
critical issues and may provide a written report of a critical issue in advance
of the weekly report). Status reports may include, but are not limited to, the
following topics, as applicable given the circumstances:
A. Delivery schedule updates, schedule impact issues and
corrective action;
B. Technical/manufacturing progress since the previous report
period, including significant accomplishments, breakthroughs,
problems and solutions;
C. Identification of changes to key manpower or staffing levels;
D. Identification of the critical events/activities expected
within the next month and a discussion of potential risk
factors;
E. Progress on open action items, including closure dates; F. Raw
material status; G. Identification of quality and
manufacturing issues and resolutions; H. Not Applicable; I.
Not Applicable; J. Not Applicable.
14.6 Reserved
15.0 INTERNATIONAL COOPERATION
15.1 Market Access and Sales Support
Seller agrees to use commercially reasonable efforts to work with Boeing to
develop a contracting strategy, which supports Boeing's market access, and
international business strategy. Boeing and Seller agree to work together to
identify countries where Seller may subcontract in support of Boeing's market
access and international business strategy. With respect to work covered by this
SBP, and if requested by Boeing, Seller agrees to use commercially reasonable
efforts to procure from subcontractors or suppliers, in countries selected by
Boeing, goods and services relating to Seller's performance of this Contract.
Such direction may occur at any time during the performance of this SBP.
Although not required to do so, Seller may satisfy such support requests through
purchases not related to this SBP. If Seller is requested by Boeing to
subcontract any part of its Product(s) and Seller anticipates an increase or
decrease to the Price for such Product(s) as a result of such direction, Seller
shall immediately notify Boeing in writing. Boeing shall respond within [ * ] on
whether Seller is to proceed and Boeing shall be responsible for any increase or
receive credit for any decrease in the Price for such Product(s).
15.2 Offset Assistance
Seller shall use commercially reasonable efforts to cooperate with Boeing in the
fulfillment of any non-United States offset program obligation that Boeing may
have accepted as a condition of the sale of a Boeing product. In the event that
Seller is requested by Boeing to solicit bids and/or proposals for, or to
procure or offer to procure any goods or services relating to the work covered
by this SBP from any source outside of the United States, Boeing shall be
entitled, to the exclusion of all others, to all industrial benefits and other
"offset" credits which may result from such solicitations, procurements or
offers to procure. Seller shall take any actions that may be required on its
part to assure that Boeing receives such credits. Seller shall document on SBP
Attachment 2 all offers to contract and executed contracts with such
subcontractors or suppliers including the dollars contracted. Seller shall
provide to Boeing an updated copy of SBP Attachment 2 for the [ * ] ending [ * ]
of each year. The reports shall be submitted on the [ * ] and the [ * ]
respectively. If Seller is requested by Boeing to subcontract any part of its
Product(s) to a country in which Boeing has an offset obligation, an equitable
price adjustment, increase or decrease, for Seller's costs and expenses will be
made by Boeing.
15.3 Credit Against Aircraft Sales
It is understood that Boeing may wish to claim part or all of the value of this
SBP as credit against a current or future Boeing offset obligation in [ * ]. The
full value of this SBP shall be held in account by the governments of of [ * ]
and [ * ] and may be applied, at Boeing's sole determination, to satisfy any
future offset obligations Boeing may accept as a condition of the sale of any
Boeing product in [ * ]. Seller will use commercially reasonable efforts to
assist Boeing in working with the appropriate government officials to obtain the
offset credit being sought.
16.0 BOEING FURNISHED MATERIAL/SUPPLIER BANKED MATERIAL
16.1 Boeing Furnished Material
Material, including but not limited to raw material, standards, detail
components and assemblies, furnished to Seller by Boeing shall be administered
in accordance with a Bonded Stores Agreement between Boeing and Seller.
Seller shall provide Boeing with required on-dock dates for all material.
Seller's notice shall provide Boeing with sufficient time to competitively
acquire the material if, in its sole and absolute discretion, it desires to do
so.
16.2 Boeing Titanium Sponge Stockpile
[ * ]
16.3 Titanium Scrap Recycling Program
[ * ]
16.4 Buffer Agreement
[ * ]
17.0 PARTICIPATION
17.1 Other Boeing Entities
[ * ], Seller agrees that any Boeing division or Boeing subsidiary ("Boeing
Entity") not specifically included in this SBP may, by issuing a purchase order,
work order, or other release document, place Orders through Boeing's Service
Provider or Procurement Representative under this SBP during the term hereof or
any written extension thereof, under the terms, conditions and pricing specified
by this SBP. Seller agrees that the prices set forth herein may be disclosed by
Boeing on a confidential basis to Boeing Entities wishing to invoke this SBP
Section 17.1. Seller shall notify the Boeing Procurement Representative named in
SBP Section 9.0 of Boeing Entities not specifically referenced herein who
frequently use this SBP.
17.2 Boeing Subcontractors / Suppliers
The Parties agree that the intent of the Contract is for all Orders by Boeing
for purchases of Product should be directed to and processed by Boeing's Service
Provider or Boeing's Procurement Representative. Seller shall not be precluded
from selling its products directly to any customers who elect not to place
orders through Boeing's Service Provider.
17.3 Notification of Contract
In the event a purchaser known by Seller to be an eligible Boeing Entity places
an Order for Product or services covered by this SBP but fails to reference this
SBP or otherwise seek the prices established by this SBP, Seller shall notify
Boeing's Procurement Representative of such inquiry by such purchaser and seek
direction from the Boeing Procurement Representative regarding the manner in
which such inquiry shall be handled.
17.4 Notification of Price Reductions
Not Applicable.
18.0 INVENTORY AT CONTRACT COMPLETION
Not Applicable.
19.0 OWNERSHIP OF INTELLECTUAL PROPERTY
Whenever Seller is providing a deliverable to Boeing that constitutes
intellectual property, the provisions of SBP Sections 19.1 through 19.5 shall
apply.
19.1 Technical Work Product
All technical work product, including, but not limited to, ideas, information,
data, documents, drawings, software, software documentation, software tools,
designs, specifications, and processes produced by or for Seller, either alone
or with others, in the course of or as a result of any work performed by or for
Seller which is covered by this SBP will be the [ * ] property of Boeing and be
delivered to Boeing promptly upon request.
19.2 Inventions and Patents
All inventions conceived, developed, or first reduced to practice by or for
Seller, either alone or with others, in the course of or as a result of any work
performed by or for Seller, which is covered by this SBP, and any patents based
upon such inventions (both domestic and foreign), will be the [ * ] property of
Boeing. Seller will (i) promptly disclose all such inventions to Boeing in
written detail and (ii) execute all papers, cooperate with Boeing, and perform
all acts necessary or appropriate in connection with the filing, prosecution,
maintenance, or assignment of related patents or patent applications on behalf
of Boeing.
19.3 Works of Authorship and Copyrights
All works of authorship (including, but not limited to, documents, drawings,
software, software documentation, software tools, photographs, video tapes,
sound recordings and images) created by or for Seller, either alone or with
others, in the course of or as a result of any work performed by or for Seller
which is covered by this SBP, together with all copyrights subsisting therein,
will be the sole property of Boeing. To the extent permitted under United States
copyright law, all such works will be works made for hire, with the copyrights
therein vesting in Boeing. The copyrights in all other such works, including all
of the [ * ] rights therein, will be promptly transferred and formally assigned
free of charge to Boeing.
19.4 Pre-Existing Inventions and Works of Authorship
Seller grants to Boeing, and to Boeing's subcontractors, suppliers, and
customers in connection with Products or work being performed for Boeing, an [ *
] license under any patents, copyrights, industrial designs and mask works
(whether domestic or foreign) owned or controlled by Seller at any time and
existing prior to or during the term of this SBP, but only to the extent that
such patents or copyrights would otherwise interfere with Boeing's or Boeing's
subcontractors', suppliers', or customers' use or enjoyment of Products or the
work product, inventions, or works of authorship belonging to Boeing under this
SBP.
19.5 Inapplicability
In the event of any inconsistency between this SBP Section 19.0 and any United
States Government contract clause incorporated by reference into this SBP or any
Order issued under this SBP, the incorporated clause shall govern to the extent
that the end user of the Products is the United States Government.
20.0 ADMINISTRATIVE AGREEMENTS
Administrative Agreements are used for administrative matters not specifically
addressed elsewhere and set forth-certain obligations of the Parties relating to
the administration of each Order. The Administrative Agreements, if any, are
identified and incorporated in SBP Section 2.3.
21.0 GUARANTEED WEIGHT REQUIREMENTS
Not Applicable.
22.0 SELLER DATA REQUIREMENTS
Not Applicable.
23.0 DEFERRED PAYMENT
Not Applicable.
24.0 SOFTWARE PROPRIETARY INFORMATION RIGHTS
Not Applicable.
25.0 CONFIGURATION CONTROL
Not Applicable.
26.0 INFRINGEMENT
Except as provided hereinbelow, Seller will indemnify, defend, and hold harmless
Boeing and its customers from all claims, suits, actions, awards (including, but
not limited to, awards based on intentional infringement of patents known to
Seller at the time of such infringement, exceeding actual damages, and/or
including attorneys' fees and/or costs), liabilities, damages, costs and
attorneys' fees related to the actual or alleged infringement of any United
States or foreign intellectual property right (including, but not limited to,
any right in a patent, copyright, industrial design or semiconductor mask work,
or based on misappropriation or wrongful use of information or documents) and
arising out of the manufacture, sale or use of Products by either Boeing or its
customers. Boeing and/or its customers will duly notify Seller of any such
claim, suit or action; and Seller will, at its own expense, fully defend such
claim, suit or action on behalf of Boeing and/or its customers. Seller shall
have no obligation under this Section 26.0 with regard to any infringement
arising from: (i) Seller's compliance with Specifications issued by Boeing where
infringement could not reasonably be avoided in complying with such
Specifications or (ii) use or sale of Products for other than their intended
application. For purposes of this Section 26.0 only, the term Customer shall not
include the United States Government; the term Boeing shall include The Boeing
Company and all Boeing subsidiaries and all officers, agents, and employees of
Boeing or any Boeing subsidiary; and the term Seller shall include Titanium
Metals Corporation and all of its subsidiaries and the respective officers,
agents and employees of each.
27.0 RAW MATERIAL PROGRAM
27.1 Boeing Raw Material Strategy
Not Applicable.
27.2 Reserved.
28.0 DIGITIZATION OF PROPRIETARY INFORMATION AND MATERIALS
Seller grants, to Boeing a license under Seller's copyrights for the purpose of
converting such of Seller's Proprietary Information and Materials as Boeing may
have a right to know hereunder to a digital format ("Digital Materials") and
make such Digital Materials available to those of its employees who have a need
to know the same for company internal use through a computer data base system.
Except as otherwise specifically agreed to in writing by the Parties, said
license set forth hereunder shall survive termination or cancellation of this
SBP relative to Digital Materials included in Boeing's computer data base system
prior to receipt of such notice of termination or cancellation. 29.0 ON-SITE
SUPPORT
29.1 Indemnification Negligence of Seller or subcontractor Reserved.
29.2 Commercial General Liability
Reserved.
29.3 Automobile Liability
Reserved.
29.4 Workers' Compensation
Reserved.
29.5 Certificates of Insurance
Reserved.
29.6 Self-Assumption
Reserved.
29.7 Protection of Property
Reserved.
29.8 Compliance with Boeing Site Requirements
Not Applicable.
30.0 BOEING TECHNICAL / MANUFACTURING ASSISTANCE REGARDING SELLER'S
NONPERFORMANCE
Not Applicable.
31.0 U.S. CUSTOMS INVOICE REQUIREMENTS
Where appropriate, Seller will provide the necessary information for clearance
through customs. Customs invoice requirements are set forth in Attachment 12 to
this SBP.
32.0 STRATEGIC ALIGNMENT
Not Applicable.
33.0 CUSTOMS-TRADE PARTNERSHIP AGAINST TERRORISM (C-TPAT)
C-TPAT is a voluntary initiative between business and government to protect
global commerce from terrorism and increase the efficiencies of global
transportation. The program calls for importers, carriers and brokers to
establish policies to enhance their own security practices and those of their
business partners involved in their supply chain. Such practices may include but
are not limited to the following:
Procedural Security -Procedures in place to protect against
unmanifested material being introduced into the supply chain;
Physical Security -Buildings constructed to resist intrusion, perimeter
fences, locking devices, and adequate lighting;
Access Controls -Positive identification of all employees, visitors and
suppliers;
Personnel Security -Employment screening, background checks and
application verifications; and
Education and Training Awareness -Security awareness training,
incentives for participation in security controls.
Seller agrees to work with Boeing and appropriate industry and governmental
agencies, as necessary, to develop and implement policies and procedures
consistent with the C-TPAT initiative (which shall not mean that Seller is
itself C-TPAT certified) to ensure the safe and secure transport of Products
under this SBP.
34.0 Reserved.
35.0 DELIVERY - TITLE AND RISK OF LOSS
35.1 Delivery Point and Schedule
Not Applicable.
35.2 Delivery Schedule of Other Products and Performance of Services
Not Applicable.
35.3 Transportation Routing Instructions Not Applicable.
35.4 Notification of Shipment
Not Applicable.
35.4.1 Title and Risk of Loss
Not Applicable.
35.5 Notice of Delay - Premium Effort
Not Applicable.
36.0 PACKAGING AND SHIPPING
Not Applicable.
36.1 Product Packaging
Not Applicable.
36.2 Consolidated Shipments and Markings
Not Applicable.
36.3 Freight Charges
Not Applicable.
36.4 Packing Sheet and Test Reports
Not Applicable.
36.5 Additional Copies
Not Applicable.
36.6 Price Inclusive
Not Applicable.
37.0 ADDITIONAL QUALITY ASSURANCE REQUIREMENTS
37.1 Federal Aviation Administration Inspection
Not Applicable.
37.2 Repair Authorization
Not Applicable.
37.2.1 Boeing-Performed Work
Not Applicable.
37.2.2 Reimbursement for Repairs
Not Applicable.
38.0 CHANGES
Not Applicable.
39.0 EXAMINATION OF RECORDS
39.1 Reports
Not Applicable.
40.0 EVENTS OF DEFAULT AND REMEDIES
40.1 Additional Event of Default Not Applicable
Not Applicable.
40.2 Interest on Overdue Amounts
Not Applicable.
41.0 CUSTOMER CONTACT
Not Applicable.
42.0 SUBCONTRACTING
Not Applicable.
43.0 SUPPLEMENTS AND MODIFICATIONS
Not Applicable.
44.0 INCREMENTAL RELEASE AND CYCLE TIME REQUIREMENTS
44.1 Incremental Release
Not Applicable.
44.2 Cycle Time Requirements
Not Applicable.
45.0 SURPLUS PRODUCTS
45.1 Return of Surplus Products
Not Applicable.
45.2 Use of Surplus Products
Not Applicable.
46.0 INTEGRATED PRODUCT TEAM
46.1 Purpose
Not Applicable.
46.2 Qualifications
Not Applicable.
46.3 Removal of Personnel
Not Applicable.
46.4 Work Schedule
Not Applicable.
46.5 Equipment and Supplies
Not Applicable.
46.6 Employment Status
Not Applicable.
46.7 Team Leader
Not Applicable.
46.8 Discipline
Not Applicable.
46.9 Insurance
Not Applicable.
46.10 Indemnification
Not Applicable.
46.11 Compensation
Not Applicable.
47.0 SELLER ASSISTANCE
Not Applicable.
48.0 DEFINE AND CONTROL AIRPLANE CONFIGURATION / MANUFACTURING RESOURCE
MANAGEMENT (DCAC/MRM)
Not Applicable.
49.0 ELECTRONIC ACCESS AND EXCHANGE OF DIGITAL PRODUCT DEFINITION
49.1 Exchange of Digital Product Definition Between Boeing and Seller
Not Applicable.
49.2 System/Software Compatibility between Boeing and Seller
Not Applicable.
49.3 Electronic Access, Communications and Data Exchange via
Telecommunications
Any electronic communications and data exchange via telecommunications between
the parties shall be pursuant to a trading partner agreement executed prior to
or concurrently with this SBP. Provided, that any amendments to the SBP, change
authorizations and any other matter requiring written authorization shall be
communicated in writing and not solely by electronic communication.
Any electronic access to Boeing by Seller shall be pursuant to an electronic
access or similar agreement.
50.0 AMENDMENT
No provision of this Contract may be changed or modified except by a writing
signed on behalf of Boeing and Seller which makes express reference to this
Contract.
51.0 AUTHORITY
Each individual executing this Contract below hereby certifies that this
Contract has been duly approved and authorized by the party on behalf of whom
such individual is executing and that such individual has been duly authorized
by such party to execute this Contract on behalf of such party.
Puget Sound POP/RM
Special Business Provisions Seller's Name: TIMET
dated 06/21/2005 [ * ]
* Certain information, indicated by "[ * ]" has been omitted and filed
separately with the U.S. Securities and Exchange Commission. Confidential
treatment has been requested with respect to such omitted portions.
INITIALS:MSC
EXECUTED in duplicate as of the date and year first set forth above by the duly
authorized representatives of the Parties.
BOEING SELLER
THE BOEING COMPANY Titanium Metals Corporation
- ------------------------------- -------------------------------
Name: Michael S. Carr Name: Derek K. George
Title: Procurement Agent Title: Boeing Contract Manager
Date: August 2, 2005 Date: August 2, 2005
Puget Sound POP/RM
Special Business Provisions Seller's Name: TIMET
dated 06/21/2005 [ * ]
* Certain information, indicated by "[ * ]" has been omitted and filed
separately with the U.S. Securities and Exchange Commission. Confidential
treatment has been requested with respect to such omitted portions.
INITIALS:MSC
[LOGO GOES HERE]
Boeing Proprietary and Seller Proprietary
SBP ATTACHMENT 1 TO
SPECIAL BUSINESS PROVISIONS
WORK STATEMENT AND PRICING
(Reference SBP Section 3.0)
FOR PURPOSES OF SBP Section 10.0, Boeing shall be deemed to refer to and include
the following organizations, divisions, groups or entities:
Boeing Commercial Aircraft, a division ofThe Boeing Company, Chicago, IL
[ * ]
Puget Sound POP/RM
Special Business Provisions Seller's Name: TIMET
dated 06/21/2005 [ * ]
* Certain information, indicated by "[ * ]" has been omitted and filed
separately with the U.S. Securities and Exchange Commission. Confidential
treatment has been requested with respect to such omitted portions.
INITIALS:MSC
SBP ATTACHMENT 1A TO
SPECIAL BUSINESS PROVISIONS
Reserved
Puget Sound POP/RM
Special Business Provisions Seller's Name: TIMET
dated 06/21/2005 [ * ]
* Certain information, indicated by "[ * ]" has been omitted and filed
separately with the U.S. Securities and Exchange Commission. Confidential
treatment has been requested with respect to such omitted portions.
INITIALS:MSC
SBP ATTACHMENT 2 TO
SPECIAL BUSINESS PROVISIONS
NON-U.S. PROCUREMENT REPORT FORM
(Seller to Submit)
(Reference SBP Section 15.2)
- -------------------- --------------- --------------- ------------ --------------
Seller Name Country Commodity/ Bid Contracted
Nomenclature Dollars Dollars
- -------------------- --------------- --------------- ------------ --------------
Puget Sound POP/RM
Special Business Provisions Seller's Name: TIMET
dated 06/21/2005 [ * ]
* Certain information, indicated by "[ * ]" has been omitted and filed
separately with the U.S. Securities and Exchange Commission. Confidential
treatment has been requested with respect to such omitted portions.
INITIALS:MSC
SBP ATTACHMENT 3 TO
SPECIAL BUSINESS PROVISIONS
RATES AND FACTORS
(Reference SBP Section 12.2)
Not Applicable.
Puget Sound POP/RM
Special Business Provisions Seller's Name: TIMET
dated 06/21/2005 [ * ]
* Certain information, indicated by "[ * ]" has been omitted and filed
separately with the U.S. Securities and Exchange Commission. Confidential
treatment has been requested with respect to such omitted portions.
INITIALS:MSC
SBP ATTACHMENT 4 TO
SPECIAL BUSINESS PROVISIONS
BOEING AOG COVERAGE
(Reference SBP Section 13.1.1)
NORMAL HOURS BOEING'S PROCUREMENT REPRESENTATIVE
Approximately 5:30 a.m. - 6:00 p.m.
|X| Performs all functions of procurement process.
|X| Manages formal communication with Seller.
SECOND SHIFT - AOG PROCUREMENT SUPPORT
3:00 p.m. - 11:00 p.m.
|X| May place order and assist with commitment and shipping information,
working with several suppliers on a priority basis.
|X| Provides a communication link between Seller and Boeing.
24 HOUR AOG SERVICE - AOG CUSTOMER REPRESENTATIVE (CUSTOMER SERVICE DIVISION)
(206) 662-7200
|X| Support commitment information particularly with urgent orders.
|X| Customer Service Representative needs (if available):
1. Part Number
2. Boeing Purchase Order
3. Airline Customer & customer purchase order number
4. Boeing S.I.S. #
If Seller is unable to contact any of the above, please provide AOG shipping
information notification via FAX using Boeing AOG shipping notification form
(SBP Attachment 5).
Puget Sound POP/RM
Special Business Provisions Seller's Name: TIMET
dated 06/21/2005 [ * ]
* Certain information, indicated by "[ * ]" has been omitted and filed
separately with the U.S. Securities and Exchange Commission. Confidential
treatment has been requested with respect to such omitted portions.
INITIALS:MSC
SBP ATTACHMENT 5 TO
SPECIAL BUSINESS PROVISIONS
BOEING
AOG SHIPPING NOTIFICATION
(Reference SBP Section 13.1.1)
- ----------------- ---------------------------- ---------------- ----------------
To: FAX: (206) 662-7145 Phone: (206) 662-7200
- ----------------- ---------------------------- ---------------- ----------------
- ----------------- ---------------------------- ---------------- ----------------
Procurement Rep. Phone:
Name:
- ----------------- ---------------------------- ---------------- ----------------
- ----------------- ---------------------------- ---------------- ----------------
From: Today's Date:
- ----------------- ---------------------------- ---------------- ----------------
- ----------------- ---------------------------- ---------------- ----------------
Part Number: Customer P.O.:
- ----------------- ---------------------------- ---------------- ----------------
- ----------------- ---------------------------- ---------------- ----------------
Customer: Ship Date:
- ----------------- ---------------------------- ---------------- ----------------
- ----------------- ---------------------------- ---------------- ----------------
Qty Shipped: *SIS Number:
- ----------------- ---------------------------- ---------------- ----------------
- ----------------- ---------------------------- ---------------- ----------------
Boeing P.O.: Pack Sheet:
- ----------------- ---------------------------- ---------------- ----------------
- ----------------- ---------------------------- ---------------- ----------------
*Airway Bill: or Invoice:
- ----------------- ---------------------------- ---------------- ----------------
- ----------------- ---------------------------- ---------------- ----------------
Carrier: *Flight #:
- ----------------- ---------------------------- ---------------- ----------------
- ----------------- ---------------------------- ---------------- ----------------
Freight Forwarder:
- ----------------- ---------------------------- ---------------- ----------------
*If Applicable
SHIPPED TO:
|X| (check one)
|_| Boeing
|_| Direct Ship to Customer
|_| Direct Ship to Seller
Remarks:
If unable to contact Procurement Representative, Please use this form to
fax shipping information.
Puget Sound POP/RM
Special Business Provisions Seller's Name: TIMET
dated 06/21/2005 [ * ]
* Certain information, indicated by "[ * ]" has been omitted and filed
separately with the U.S. Securities and Exchange Commission. Confidential
treatment has been requested with respect to such omitted portions.
INITIALS:MSC
SBP ATTACHMENT 6 TO
SPECIAL BUSINESS PROVISIONS
SELLER DATA SUBMITTALS
Diversity Reports
Not Applicable.
Problem Reports (as required)
Seller's written notification to Boeing of program problems, potential
program impact and corrective action. Refer to SBP Section 14.5 for
details.
AOG Spares Support Plan
Not Applicable.
Non-U.S. Procurement Reporting (as required)
A report, submitted in February and August annually, to document the
Seller's contracts and solicitations with non-U.S. subcontractors or
suppliers, relating to the work covered by this SBP. Refer to SBP Section
15.2 for details.
Certified Tool List
Not Applicable.
General Reports (as requested by Boeing)
General reports may include, but not be limited to, Seller's program
progress reports, highlighting significant accomplishments and critical
program issues, Seller's manufacturing schedule depicting key milestone
events to support program requirements. Refer to SBP Section 14.1 for
details.
Puget Sound POP/RM
Special Business Provisions Seller's Name: TIMET
dated 06/21/2005 [ * ]
* Certain information, indicated by "[ * ]" has been omitted and filed
separately with the U.S. Securities and Exchange Commission. Confidential
treatment has been requested with respect to such omitted portions.
INITIALS:MSC
SBP ATTACHMENT 7 TO
SPECIAL BUSINESS PROVISIONS
SUPPLIER DATA REQUIREMENTS LIST ("SDRL")
CUSTOMER AND ENGINEERING
(Reference SBP Section 22.0)
Not Applicable.
Puget Sound POP/RM
Special Business Provisions Seller's Name: TIMET
dated 06/21/2005 [ * ]
* Certain information, indicated by "[ * ]" has been omitted and filed
separately with the U.S. Securities and Exchange Commission. Confidential
treatment has been requested with respect to such omitted portions.
INITIALS:MSC
SBP ATTACHMENT 8 TO
SPECIAL BUSINESS PROVISIONS
COMMODITY LISTING AND TERMS OF SALE
(Reference SBP Section 27.0)
COMMODITY LISTING
Titanium -
All titanium mill products for which pricing is provided in Attachment 1 to the
SBP including [ * ].
SBP ATTACHMENT 8 TO
SPECIAL BUSINESS PROVISIONS
CONTINUED
TERMS OF SALE
(Reference SBP Section 27.0)
Not Applicable.
SBP ATTACHMENT 9 TO
SPECIAL BUSINESS PROVISIONS
(use this SBP Attachment if 11.0 optional paragraph is used)
COST PERFORMANCE REVIEWS
(Reference SBP Section 11.0)
(OPTION A)
Cost Performance Reviews (CPR's) will occur on as needed basis (alternating
between Seller and Boeing locations unless otherwise agreed) at a mutually
agreeable time. The detail of the CPR's will be defined at a later date by
mutual agreement between Boeing and Seller. When they are defined, this SBP
Attachment 9 will be updated.
Puget Sound POP/RM
Special Business Provisions Seller's Name: TIMET
dated 06/21/2005 [ * ]
* Certain information, indicated by "[ * ]" has been omitted and filed
separately with the U.S. Securities and Exchange Commission. Confidential
treatment has been requested with respect to such omitted portions.
INITIALS:MSC
SBP ATTACHMENT 10 TO
SPECIAL BUSINESS PROVISIONS
QUALITY ASSURANCE REQUIREMENTS
A10.1 Quality System
All work performed under this SBP shall be in accordance with the following:
A. Not Applicable
B. Not Applicable
C. Not Applicable
D. Not Applicable
E. Not Applicable
F. Document D6-82479, "Boeing Quality Management System Requirements for
Suppliers - Appendix A - Quality Management System" as amended from
time to time, which is incorporated herein and made a part hereof by
this reference.
G. Not Applicable
H. Not Applicable
I. Not Applicable
J. Not Applicable
A10.2 Common Quality Purchasing Data and Business Requirements
A10.2.1 Seller [ * ] Quality Audit
At least [ * ], the Seller shall conduct an internal audit to ensure compliance
to their quality system and the controlling quality assurance document.
A10.2.2 Change in Quality Management Representative
The Seller shall promptly notify Boeing of any changes in the management
representative with assigned responsibility and authority for the quality system
A10.2.3 English Language
When specifically requested by Boeing, Seller shall make specified quality data
and/or approved design data available in the English language.
The Seller shall maintain an English language translation of (1) its quality
manual, and (2) an index of all other Seller procedures that contain quality
requirements. Boeing may require the Seller to translate additional
documentation.
A10.2.4 Changes to Quality System
The Seller shall immediately notify Boeing in writing of any change to the
quality control system that may affect the inspection, conformity or
airworthiness of the Product. After the issue of initial Boeing quality system
approval, each change to the quality control system is subject to review by
Boeing.
A10.2.5 Change in Manufacturing Facility
The Seller shall immediately notify Boeing in writing of any change to the
manufacturing facility location of the contracted part number or assembly.
A10.2.6 Excess Inventory
The Seller shall strictly control all inventory of Boeing proprietary product
that is in excess of contract quantity in order to prevent product from being
sold or provided to any third party without prior written authorization from
Boeing.
A10.2.7 Aerospace Quality Management System (AQMS) Certification
Boeing recognition of Seller's AQMS certification/registration does not affect
the right of Boeing to conduct audits and issue findings at the Seller's
facility. Boeing reserves the right to provide Boeing-identified quality system
findings, associated quality system data, and quality performance data to the
Seller's Certification /Registration Body (CRB).
Seller shall ensure the following relative to AQMS certification:
A10.2.7.1 Accreditation of Certification/Registration Body
The certification/registration body (CRB) is accredited to perform aerospace
quality management system (AQMS) assessments. The CRB must use approved auditors
and operate in accordance with the corresponding International Aerospace Quality
Group (IAQG) certification/registration scheme.
NOTE: IAQG sanctioned certification/registration schemes include but
are not limited to AIR 5359, SJAC 9010, TS157, etc. Reference
IAQG website for listing of accredited CRBs:
http://www.iaqg.sae.org/servlets/index?PORTAL_CODE=IAQG
A10.2.7.2 Records of Certification/Registration
The seller maintains objective evidence of CRB certification/registration on
file at Seller's facility. Objective evidence shall include:
A. The accredited AQMS certificate(s) of registration;
B. The audit report(s), including all information pertaining to the audit
results in accordance with the applicable certification/registration
scheme;
C. Copies of all CRB finding(s), objective evidence of acceptance of
corrective action(s), and closure of the finding(s).
NOTE: Certification records shall be maintained in accordance
with Boeing specified contractual quality record retention
requirements.
A10.2.7.3 Right of Access to CRB
The CRB services agreement provides for "right of access" to all CRB records by
Boeing, applicable accreditation body, applicable Registrar Management Committee
(RMC) and other regulatory or government bodies for the purpose of verifying CRB
certification/registration criteria and methods are in accordance with the
applicable IAQG certification/registration scheme.
A10.2.7.4 Audit Results/Data Reporting to IAQG
The CRB has Seller's written permission to provide audit results/data to IAQG
membership as required by the applicable IAQG certification/registration scheme.
A10.2.7.5 Notification to Boeing of Change in Status
Boeing is immediately notified in writing should the Seller's
certification/registration be suspended or withdrawn, or accreditation status of
Seller's CRB is withdrawn. Send email notification to
grpcrboversightrep@boeing.com .
A10.2.7.6 Provision of Boeing Quality Data to CRB
Boeing-identified findings and Seller's quality performance data is provided to
the CRB during certification/registration and surveillance activity.
A10.2.7.7 CRB Access to Proprietary Data
CRB shall be provided access to applicable proprietary data (including Boeing
proprietary data) to the extent necessary to assess Seller's compliance to AQMS
requirements. CRB shall agree to keep confidential and protect Boeing
proprietary information under terms no less stringent than Seller's contractual
agreement with Boeing. Seller will assure that such information is conspicuously
marked "BOEING PROPRIETARY".
A10.2.7.8 Seller Compliance with CRB Requirements
Seller complies with all CRB requirements imposed to issue and maintain
certification/registration.
A10.2.8 Verification of Corrective Action
When Boeing notifies Seller of a detected nonconformance, Seller shall
immediately take action to eliminate the nonconformance on all products in
Seller's control. Seller shall also maintain on file verification that root
cause corrective action has occurred and has resolved the subject condition. At
the specific request of Boeing, this verification shall occur for [ * ] after
implementation of the corrective action to ensure detected nonconformance has
been eliminated. Boeing reserves the right to review the verification data at
Seller's facility or have the data submitted to Boeing.
A10.2.9 Corrective Action Report
Where Seller is requested to submit a corrective action report, Seller will
submit its response within [ * ] of receipt of such request unless an extension
is otherwise provided by Boeing. Any corrective action report submitted to
Boeing shall be in the format specified by Boeing. If after submittal to Boeing,
Seller determines need for revision, Seller shall immediately notify Boeing of
such revision In the event Seller is unable to respond within the allotted ten
day time frame, Seller shall submit a request for extension which shall include
the reason for the extension request and the time need to complete the
corrective action report.
A10.2.10 Relocation/Subcontract Notification (Puget Sound only)
The Seller shall not relocate or subcontract any Category I or II work outside
the U.S. (unless such relocation is to another entity or facility owned or
controlled by Seller that is approved by Boeing's Quality System) without
written Boeing acceptance. Notification to Boeing should be made to the
Procurement Agent who manages the Seller's contract and shall contain the
subcontractor name, address, telephone number, QA manager name, applicable part
numbers, and part descriptions. Category I and II work is defined in FAA Order
8120.2, Appendix 4.
A10.2.11 Quality Metrics & Reporting
When requested by Boeing, Seller agrees to work with Boeing to develop and
implement processes designed at improving Seller's quality performance. Process
will include sufficient detail to allow Boeing to evaluate Seller's progress
A10.3 Site Unique Quality Purchasing Data Requirements
A10.3.1 Acceptance/Rejection of Seller's Root Cause/Corrective Action
Boeing reserves the right to reject any root cause and/or corrective action
determination provided by the Seller, and may request subsequent investigation
and/or corrective action to either Boeing or Seller-initiated corrective action
requests. If the Seller is late in responding to corrective action requests by
Boeing, or if Boeing requires subsequent corrective action, Boeing reserves the
right to withhold acceptance of shipments either at source or destination until
Seller corrective action is submitted to Boeing's satisfaction
A10.3.2 Seller Inspection Responsibilities For Delegated Inspection Authority
If Seller fails to achieve and maintain [ * ] on the terms required by the
contract between Seller and Boeing, which is a prerequisite for delegated
inspection authority awarded at Boeing's discretion, the Seller shall be
responsible for one or more of the following as directed by Boeing:
A. Obtaining source inspection from a Boeing-qualified contractor at Seller's
own expense;
B. Reimbursing Boeing for reasonable Boeing costs incurred at the point of
manufacture (i.e. Seller's site) to verify product conformance;
C. Reimburse Boeing for reasonable Boeing costs incurred at the point of
receipt to verify product conformance.
The site [ * ] is a calculation of the ratio of acceptable units delivered to
the total units delivered, or an alternate criteria [ * ] as defined by the
contracting Boeing site(s).
A10.3.3 Not Applicable
A.10.4 Incorporated by Reference
In addition to any other documents incorporated elsewhere in this SBP or GTA by
reference, Seller is required to maintain compliance with the following
documents as may be revised from time to time, and incorporated herein, and made
a part of this SBP by reference with full force and effect, as if set out in
full text:
A10.4.1 Document AS/EN/SJAC 9102, "Aerospace First Article
Inspection (FAI) Requirement"
Seller shall perform First Article Inspections (FAIs) in accordance with
AS/EN/SJAC 9102.
A10.4.2 Boeing Document D1-8007, "Approval Guide for Supplier
Statistical Sampling Plans"
A Seller that performs acceptance sampling shall meet the requirements of
document D1-8007 or other mutually agreed sampling plan. Boeing approval of
Seller's acceptance sampling plan is required prior to performing acceptance
sampling when it is used for in-process or final inspection, and employs
continuous sampling or repetitive lot sampling. Subsequent revisions to approved
sampling plans require Boeing approval prior to implementation. Prior Boeing
approval of a sampling plan is not required if it is used exclusively for
receiving inspection, or employs only isolated lot sampling during in-process or
final inspection.
When statistical process control is used as an option for either in-process or
final inspection, Seller shall satisfy the requirements of document AS/EN/SJAC
9103, Variation Management of Key Characteristics.
In all cases, inspection requirements identified by engineering drawing or
specification take precedence over the inspection requirements defined herein.
A10.4.3 Boeing Document D6-51991, "Quality Assurance Standard for
Digital Product Definition (DPD) at
Boeing Suppliers"
Boeing document D6-51991, "Quality Assurance Standard for Digital Product
Definition at Boeing Suppliers". When Type Design Digital Product Definition
(DPD) data is utilized in manufacturing, inspection and subtier flowdown of
product definition, Seller shall have a quality system to control Type Design
DPD data to the extent necessary to fulfill program requirements. Seller must
obtain Boeing DPD capability approval.
A10.4.4 Boeing Document D1-4426, "Approved Process Sources"
This document defines the approved sources for special processing, composite raw
materials, composite products, aircraft bearings, designated fasteners, and
metallic raw materials.
A10.4.5 Boeing Document D-13709-4, "Requirements for Obtaining MRB
Authority by Boeing Suppliers"
Seller shall not use dispositions of use-as-is or repair on Boeing-designed
product unless current revision of Seller's Material Review Board (MRB) plan
complies with D-13709-4 and has been approved by Boeing.
A10.4.6 Not Applicable
A10.4.7 Not Applicable
A10.4.8 Not Applicable
For complete text of notes, access via Boeing Partners Network (BPN) or contact
Procurement Representative.
Puget Sound POP/RM
Special Business Provisions Seller's Name: TIMET
dated 06/21/2005 [ * ]
* Certain information, indicated by "[ * ]" has been omitted and filed
separately with the U.S. Securities and Exchange Commission. Confidential
treatment has been requested with respect to such omitted portions.
INITIALS:MSC
SBP ATTACHMENT 11 TO
SPECIAL BUSINESS PROVISIONS
When Required.
Boeing Commercial Airplanes (BCA) SECOND TIER SUPPORT REPORT (Reference SBP
Section 14.2)
======================================================================================================== ======================
Seller Name: Date:
===============================================================================================================================
Seller Contact: Phone:
===============================================================================================================================
BCA Procurement Representative Contact: Phone:
===============================================================================================================================
BCA Purchase Contract #:
======================================================================================================== ======================
Reporting Period * Jan - Mar Apr - Jun July - Sept Oct - Dec Year:
===============================================================================================================================
Definitions **
================================ ==============================================================================================
Small Business (SB) The term "small business" shall
mean a small business as defined pursuant to
section 3 of the Small Business Act (15
U.S.C.A. 632) and relevant regulations issued
pursuant thereto. Generally, this means a small
business organized for profit, it is
independently owned and operated, is not
dominant in the field of operations in which it
is bidding, and meets the size standards as
prescribed in Government regulations. (Includes
SDBs, SMBEs and WOSBs)
================================ ==============================================================================================
Small Disadvantaged business A small business certified by the U.S. Small Business Administration as a socially and
(SDB) economically small disadvantaged business for consideration of Government set-a-side
contracting opportunities and business development. (Inc. SDBs who are women-owned)
================================ ==============================================================================================
Small Minority Business A small business that is at least 51 percent owned, operated and controlled by a minority
Enterprise (SMBE) group member (Asian, Black, Hispanic, and Native Americans); or, in the case of a
publicly-owned business, at least 51% of the
stock is owned by one or more minority group
members and such individuals control the
management and daily operations. (Includes
SDBs)
================================ ==============================================================================================
Women-owned Small Business A small business concern that is at least 51 percent owned by one or more women; or, in the
(WOSB) case of any publicly owned business, at least 51 percent of the stock is owned by one or
more women; and whose management and daily
business operations are controlled by one or
more women. (Includes WOSBs who are also SDBs)
================================ ==============================================================================================
===============================================================================================================================
Contract Dollars Received by Seller
===============================================================================================================================
======= =======================================================================================================================
A. Boeing Commercial Airplanes contract dollars received by seller for the
above reporting period* (report in whole numbers):
$________________________________
======= =======================================================================================================================
===============================================================================================================================
Value of Subcontract 2nd Tier Dollars Awarded
(for Boeing Commercial Airplanes Purchase Contracts ONLY)
===================================================== =========================================================================
Diversity Category Reporting Period (see above*)
===================================================== =========================================================================
===================================================== =================================================== =====================
Dollars Percent of
(report in whole numbers) Seller Dollars
===================================================== =================================================== =====================
======= ============================================= =================================================== =====================
B. Small Business (SB) (B / A)
======= ============================================= =================================================== =====================
======= ============================================= =================================================== =====================
C. Small Minority Business Enterprise (SMBE) (C / A)
======= ============================================= =================================================== =====================
======= ============================================= =================================================== =====================
D. Women-owned Small Business (WOSB) (D / A)
======= ============================================= =================================================== =====================
===================================================== =========================================================================
Puget Sound POP/RM
Special Business Provisions Seller's Name: TIMET
dated 06/21/2005 [ * ]
* Certain information, indicated by "[ * ]" has been omitted and filed
separately with the U.S. Securities and Exchange Commission. Confidential
treatment has been requested with respect to such omitted portions.
INITIALS:MSC
- -------------------------------------------------------------------------------
Authorized Company | Authoried Company Date:
Representative (Print): | Representative (Signature):
- -------------------------------------------------------------------------------
SBP ATTACHMENT 12 TO
SPECIAL BUSINESS PROVISIONS
(Reference SBP Section 31.0)
For Imports into the United States
a. Record the United States Port of Entry where merchandise is to be
cleared by CBP
b. Quantities, weights and measures
i. Record the quantity of each item in the shipment
ii. If not separately noted on packing sheet(s) include on invoice:
o Total quantity of parts being shipped
o Provide net weight of each part number and gross
weight of entire shipment
o Specify unit of measure being used
o Specify the total number of boxes included per
packing sheet.
o Textiles must specify the net gross weights and the
length, width and total square meters of material.
c. Provide a detailed description of each item being shipped to ensure
proper product classification per the Harmonized Tariff Schedule (HTS)
and must include at a minimum:
i. The full name by which each item is known
ii. Part Number as appears on Purchase Order/Contract. If the item
is a raw material, provide the material grade, class and
dimensions.
Notes:
o Generic descriptions, abbreviations, acronyms, and
Stock Keeping Unit (SKU) numbers are not acceptable.
o Boeing may request additional description information
for items that do not have a Boeing part number and
or design.
o Seller will provide material class, grade, dimensions
and assembly components if part is manufactured by
Seller's own manufacturing drawings.
Puget Sound POP/RM
Special Business Provisions Seller's Name: TIMET
dated 06/21/2005 [ * ]
* Certain information, indicated by "[ * ]" has been omitted and filed
separately with the U.S. Securities and Exchange Commission. Confidential
treatment has been requested with respect to such omitted portions.
INITIALS:MSC
SBP ATTACHMENT 12 TO
SPECIAL BUSINESS PROVISIONS
CONTINUED
Commercial Invoice Requirements (Customs Invoice)
For Imports into the United States
d. Country of Origin: indicate the country of manufacture of each
item.
e. Terms of Sale: Specify the International Commercial Terms of
Sale (Incoterms) as agreed to per the Boeing Contract on the
invoice or Boeing Work Authorization.
f. Specify "Related Party to the Boeing Company" status (Yes or
No) on the invoice.
g. Commercial Invoice Number (Seller's option) h. Page numbers
are required for each invoice (example: ____ of ____ pages).
2. Commercial Invoice Valuation Requirements
a. Must be complete and accurate, including the unit cost of each
part and the total value of the entire shipment.
b. Currency on all invoices must reflect the actual currency of
the purchase contract and the transaction of money between the
buyer and the seller.
c. List separately any Assists and/or additional costs used for
manufacturing each part. For example:
o Assists: Any components, materials, dies molds and
tools that are supplied by Boeing free of charge or
at a reduced cost to the Seller, and used in the
production of imported goods. This includes any
Boeing paid transportation costs associated with the
assist. These transportation costs will be provided
by the procurement focal responsible for this
merchandise.
o Engineering and Design work - Work that is performed
outside the U.S. by non-U.S. employees, and is not
included in the unit price of the merchandise being
imported.
o Packing Costs - Costs for packing that are incurred
by the Boeing and have not been included in the unit
cost.
o Non-recurring charges - One time charges, incurred by
the Boeing, for such items as, expedite fees and
transportation costs, which have not been included in
the unit cost.
o Selling Commissions - Commissions incurred by Boeing
that have not been included in the unit cost.
o Royalties - Fees the Boeing is required to pay as a
condition of sale.
Puget Sound POP/RM
Special Business Provisions Seller's Name: TIMET
dated 06/21/2005 [ * ]
* Certain information, indicated by "[ * ]" has been omitted and filed
separately with the U.S. Securities and Exchange Commission. Confidential
treatment has been requested with respect to such omitted portions.
INITIALS:MSC
SBP ATTACHMENT 12 TO
SPECIAL BUSINESS PROVISIONS
CONTINUED
Commercial Invoice Requirements (Customs Invoice)
For Imports into the United States
d. List all discounts that have been agreed to, or may be
allowed, that apply to the purchase price or value, but have
not been included in the unit price (Terms of Payment).
e. Repaired or modified parts - separately enter the value of the
item and the value of the repair on the invoice. For "no
charge" repair show the value of the repair on invoice.
f. If Seller receives any rebates, drawbacks or bounties, as a
result of exportation, please itemize and provide description.
3. Packing Sheet\slip (if used by supplier)
a. Include packing sheet\slip number(s) on invoice
4. US Government Programs Only (Regardless of Business Units)
a. If a government contract applies, the prime contract number
must be noted on the commercial invoice. Additionally, the
following government contract statement needs to be shown as
follows for Military Programs.
"United States Dept. of Defense Duty-Free Entry to be claimed
pursuant to Section XXII, Chapter 98, Sub-chapter VIII, item
9808.00.3000 of the Harmonized Tariff Schedules to The United
States. Upon arrival of shipment at the port of entry,
District Director of Customs, please release shipment under
Section 19 CFR Part 142 and notify Commander, Defense Contract
Management Area Operations (DCMAO) New York, for execution of
customs forms and any required duty free entry certificates."
b. Commercial Invoice must show that the shipment is consigned to
a U.S. Government Agency (i.e.: U.S. Department of Defense) in
"care of Boeing", if shipment has a prime contract number.
c. If items were exported on a license or exemption upon
importation, that license or exemption information should be
notated as follows:
Example: "Originally exported under DSP-XX license number
XXXXXX" or "Imported under 22 CFR XXXXX"
Puget Sound POP/RM
Special Business Provisions Seller's Name: TIMET
dated 06/21/2005 [ * ]
* Certain information, indicated by "[ * ]" has been omitted and filed
separately with the U.S. Securities and Exchange Commission. Confidential
treatment has been requested with respect to such omitted portions.
INITIALS:MSC
SBP ATTACHMENT 13 TO
SPECIAL BUSINESS PROVISIONS
On Site Terms and Conditions Supplement
(Reference SBP Section 29.8)
Not Applicable.
Puget Sound POP/RM
Special Business Provisions Seller's Name: TIMET
dated 06/21/2005 [ * ]
* Certain information, indicated by "[ * ]" has been omitted and filed
separately with the U.S. Securities and Exchange Commission. Confidential
treatment has been requested with respect to such omitted portions.
INITIALS:MSC
SBP ATTACHMENT 14 TO
SPECIAL BUSINESS PROVISIONS
PRODUCTION ARTICLE DELIVERY SCHEDULE
(Reference SBP Section 2.1, GTA Sections 4.0 & 7.0)
Not Applicable
Puget Sound POP/RM
Special Business Provisions Seller's Name: TIMET
dated 06/21/2005 [ * ]
* Certain information, indicated by "[ * ]" has been omitted and filed
separately with the U.S. Securities and Exchange Commission. Confidential
treatment has been requested with respect to such omitted portions.
INITIALS:MSC
SBP ATTACHMENT 15 TO
SPECIAL BUSINESS PROVISIONS
PRODUCTION ARTICLE DEFINITION AND CONTRACT CHANGE NOTICES
(Reference SBP Section 3.3.2.1)
Not Applicable
Puget Sound POP/RM
Special Business Provisions Seller's Name: TIMET
dated 06/21/2005 [ * ]
* Certain information, indicated by "[ * ]" has been omitted and filed
separately with the U.S. Securities and Exchange Commission. Confidential
treatment has been requested with respect to such omitted portions.
INITIALS:MSC
SBP ATTACHMENT 16 TO
SPECIAL BUSINESS PROVISIONS
NON-RECURRING AND RECURRING PRICE STATUS AND SUMMARY TABLES
(Reference SBP Section 12.2)
Not Applicable
Puget Sound POP/RM
Special Business Provisions Seller's Name: TIMET
dated 06/21/2005 [ * ]
* Certain information, indicated by "[ * ]" has been omitted and filed
separately with the U.S. Securities and Exchange Commission. Confidential
treatment has been requested with respect to such omitted portions.
INITIALS:MSC
SBP ATTACHMENT 17 TO
SPECIAL BUSINESS PROVISIONS
Reserved
Puget Sound POP/RM
Special Business Provisions Seller's Name: TIMET
dated 06/21/2005 [ * ]
* Certain information, indicated by "[ * ]" has been omitted and filed
separately with the U.S. Securities and Exchange Commission. Confidential
treatment has been requested with respect to such omitted portions.
INITIALS:MSC
SBP ATTACHMENT 18 TO
SPECIAL BUSINESS PROVISIONS
INDENTURED PRICED PARTS LIST AND SPARES PRICING
Not Applicable
Puget Sound POP/RM
Special Business Provisions Seller's Name: TIMET
dated 06/21/2005 [ * ]
* Certain information, indicated by "[ * ]" has been omitted and filed
separately with the U.S. Securities and Exchange Commission. Confidential
treatment has been requested with respect to such omitted portions.
INITIALS:MSC
SBP ATTACHMENT 19 TO
SPECIAL BUSINESS PROVISIONS
INCREMENTAL RELEASE PLAN AND LEAD TIMES
(Reference SBP Section 44.0)
Not Applicable
Puget Sound POP/RM
Special Business Provisions Seller's Name: TIMET
dated 06/21/2005 [ * ]
* Certain information, indicated by "[ * ]" has been omitted and filed
separately with the U.S. Securities and Exchange Commission. Confidential
treatment has been requested with respect to such omitted portions.
INITIALS:MSC
SBP ATTACHMENT 20 TO
SPECIAL BUSINESS PROVISIONS
Reserved
Puget Sound POP/RM
Special Business Provisions Seller's Name: TIMET
dated 06/21/2005 [ * ]
* Certain information, indicated by "[ * ]" has been omitted and filed
separately with the U.S. Securities and Exchange Commission. Confidential
treatment has been requested with respect to such omitted portions.
INITIALS:MSC
SBP ATTACHMENT 21 TO
SPECIAL BUSINESS PROVISIONS
[ * ]
Puget Sound POP/RM
Special Business Provisions Seller's Name: TIMET
dated 06/21/2005 [ * ]
* Certain information, indicated by "[ * ]" has been omitted and filed
separately with the U.S. Securities and Exchange Commission. Confidential
treatment has been requested with respect to such omitted portions.
INITIALS:MSC
SBP ATTACHMENT 22 TO
SPECIAL BUSINESS PROVISIONS
[ * ]