Transparency in Supply Chain Compliance

Breg is committed to responsible sourcing, including the elimination of human trafficking and slavery in our supply chain. We expect all of our direct suppliers to comply with all applicable laws, including eradication of forced, bonded, indentured, involuntary convict or compulsory labor or illegal child labor. Fundamental to Breg's tenets, we expect our direct suppliers to adopt sound human rights practices and to treat workers fairly and with dignity and respect, provide a safe and healthy work environment for their workers, conduct business in compliance with applicable environmental and employment laws, maintain accurate books and records as it relates to any labor or services for Breg, refrain from corrupt practices and comply with all other applicable laws and regulations.

Breg requires that its direct suppliers certify in Purchase Orders after January 1, 2012 that the supplier complies with all applicable laws, including eradication of forced, bonded, indentured, involuntary convict or compulsory labor or illegal child labor in its facilities as well as certifying that its supply chain and materials incorporated into its products comply with the laws prohibiting slavery and human trafficking. Breg further requires its direct suppliers to agree that they have adopted sound human rights practices, they treat their workers fairly and with dignity and respect, they provide a safe and healthy work environment for their workers, conduct business in compliance with applicable environmental and employment laws, maintain accurate books and records as it relates to any labor or services for Breg, refrain from corrupt practices and comply with all other applicable laws and regulations.

Suppliers must further agree in such Purchase Orders that they may be audited by Breg or its designated auditors in an unannounced fashion and that failure to abide by the terms of the Purchase Order may result in immediate termination of contracts or other remedy as Breg deems appropriate.

Commencing January 1, 2012, Breg's procurement department verifies that direct suppliers have provide such certifications as part of the Purchase Order process. Breg is considering at this time whether to adopt additional verification, audit, certification, standards and training processes related to its supply chain.