1. Introduction & Purpose

This Product Recall & Safety Policy (the "Policy") establishes the procedures and guidelines for Nexly Corporation ("Nexly" or the "Company") to address and manage product recalls and safety issues related to its products. Located at 701 South Street Suite 100, Mountain Home, AR 72653, Nexly is committed to the safety of its customers and the quality of its products. This Policy is designed to:

• Protect Customer Safety: Prioritize customer safety by promptly addressing product safety issues.
• Comply with Legal and Regulatory Requirements: Comply with all applicable laws, regulations, and industry standards related to product safety and recalls.
• Minimize Risk: Minimize the risk of injury, illness, or property damage caused by defective or unsafe products.
• Protect Brand Reputation: Protect Nexly's brand reputation by responding effectively and transparently to product safety issues.
• Ensure Timely and Effective Recalls: Implement a timely and effective product recall process, if necessary.
• Provide Information to Consumers: Provide accurate and timely information to consumers about product safety issues and recalls.
• Establish Clear Responsibilities: Define the roles and responsibilities of all Nexly employees involved in the product recall process.

This Policy applies to all Nexly products, including those designed, manufactured, distributed, or sold by Nexly or under its brand name. This Policy is to be read in conjunction with other Company policies, including, but not limited to, the Product Liability Policy, the Customer Support & Complaint Handling Policy, and the Ethical Sourcing Policy.

2. Definitions

For the purposes of this Policy, the following definitions apply:

• Product: Any product designed, manufactured, distributed, or sold by Nexly or under its brand name.
• Product Defect: A defect in the design, manufacture, or labeling of a product that poses a safety risk or violates a regulatory requirement.
• Safety Risk: A potential for injury, illness, or property damage posed by a product defect.
• Recall: A voluntary or mandatory action taken by Nexly to remove a defective or unsafe product from the market or to provide a remedy to address a safety risk.
• Regulatory Agency: A governmental agency with authority over product safety, such as the Consumer Product Safety Commission (CPSC), the Food and Drug Administration (FDA), or similar agencies in other jurisdictions.
• Incident: Any event that results in, or could have resulted in, an injury, illness, or property damage related to a Nexly product.
• Consumer: Any individual or entity that purchases, uses, or is otherwise exposed to a Nexly product.
• Critical Product: A product where a defect, failure, or malfunction could lead to serious injury or death.

3. Roles & Responsibilities

Effective product recall management requires clearly defined roles and responsibilities across the organization.

• 3.1. Board of Directors:
  • Oversees the Company's product safety and recall program.
  • Approves this Policy and reviews its effectiveness.
  • Monitors the Company's performance in product safety and recalls.
• 3.2. Product Safety and Recall Committee (PSRC) (or equivalent): (If applicable, or alternatively, a designated senior management group).
  • Oversees the product safety and recall program.
  • Evaluates product safety issues and determines whether a recall is necessary.
  • Develops and implements product recall plans.
  • Monitors the progress of product recalls.
  • Communicates with regulatory agencies, as needed.
  • The PSRC will be comprised of [Specify Members and their Titles, e.g., the CEO, Head of Engineering, Head of Quality, Head of Legal, Head of Marketing, and a representative from Customer Support]. The Chair of the PSRC will be [Specify Title, e.g., the Head of Quality or the General Counsel].
• 3.3. Chief Executive Officer (CEO):
  • Provides overall leadership and direction for the Company's product safety and recall program.
  • Ensures that the Product Recall & Safety Policy is integrated into all business activities.
  • Supports the Product Safety and Recall Committee (or equivalent) in its efforts.
  • Makes the final decision on whether to initiate a product recall.
• 3.4. Head of Quality:
  • Responsible for the overall quality of the Company's products.
  • Oversees the product safety testing and inspection programs.
  • Identifies potential product defects and safety risks.
  • Leads the investigation of product-related incidents.
  • Chairs the Product Safety and Recall Committee (or equivalent) or is a key member.
• 3.5. Engineering & Design Team:
  • Ensures that products are designed and manufactured to meet safety standards and requirements.
  • Participates in the investigation of product defects and safety risks.
  • Provides technical expertise during the recall process.
• 3.6. Head of Legal Counsel (or equivalent):
  • Provides legal advice and guidance on product safety and recall matters.
  • Coordinates communications with regulatory agencies.
  • Reviews and approves all communications related to product recalls.
• 3.7. Head of Marketing and Communications:
  • Develops and executes the communications strategy for product recalls, including press releases, website updates, and customer notifications.
  • Manages communications with consumers and the media.
• 3.8. Head of Operations and Supply Chain:
  • Coordinates the removal of recalled products from the market.
  • Manages the return of recalled products from customers.
  • Works with suppliers to address product defects.
• 3.9. Customer Support Department:
  • Receives and responds to customer inquiries about product safety issues and recalls.
  • Provides customers with information about product recalls and instructions on how to participate.
  • Manages customer returns and refunds.
• 3.10. All Employees:
  • Report any potential product safety issues to their supervisor or the Head of Quality.
  • Cooperate with the Company's product safety and recall efforts.

4. Product Safety Incident Reporting and Evaluation

Nexly Corporation will establish a system for reporting and evaluating product safety incidents.

• 4.1. Incident Reporting:
  • Reporting Obligation: All employees and other stakeholders are required to report any product-related incidents, including injuries, illnesses, and property damage, to the Head of Quality or the designated contact person.
  • Reporting Channels: Reports can be submitted through the following channels:
    • Direct Supervisor: Reporting the incident to their immediate supervisor.
    • Head of Quality (or Designee): Contacting the Head of Quality or the designated contact person within the Quality Department. [Specify Contact Information, e.g., quality@nexlycorp.com or 555-1212].
    • Ethics Hotline: Using the Company's Ethics Hotline [If applicable].
  • Report Content: The report should include as much detail as possible, including:
    • A description of the incident.
    • The product involved.
    • The date and location of the incident.
    • The nature and severity of any injuries or property damage.
    • Contact information for the reporting party and any witnesses.
• 4.2. Incident Investigation:
  • Prompt Investigation: The Head of Quality or the designated contact person will initiate an investigation promptly after receiving a report of a product-related incident.
  • Investigation Team: The Head of Quality or the designated contact person will assemble an investigation team, which may include representatives from Engineering, Legal, Marketing, and Customer Support.
  • Investigation Process: The investigation will include:
    • Collecting and analyzing information about the incident.
    • Inspecting the product.
    • Interviewing witnesses.
    • Reviewing relevant documents and records.
    • Determining the root cause(s) of the incident.
    • Assessing the severity of the safety risk.
  • Documentation: Documenting the incident investigation, including the findings, root cause(s), and any corrective actions taken.
• 4.3. Risk Assessment:
  • Severity Determination: The Product Safety and Recall Committee (or equivalent) will assess the severity of the safety risk. This assessment will consider factors such as:
    • The potential for injury or death.
    • The frequency of the hazard.
    • The severity of the potential injury.
    • The number of products affected.
    • Any applicable regulations.
  • Risk Matrix: Utilize a risk matrix to classify each risk.
  • Decision to Recall: Based on the risk assessment, the Product Safety and Recall Committee (or equivalent), in consultation with Legal Counsel, will determine whether a product recall is necessary. The CEO will make the final decision.

5. Product Recall Procedures

If a product recall is determined to be necessary, Nexly Corporation will implement a product recall plan.

• 5.1. Recall Plan Development:
  • Recall Plan Components: Develop a detailed recall plan that includes, but is not limited to:
    • A description of the product being recalled.
    • The reason for the recall.
    • The number of products affected.
    • The dates of manufacture or distribution.
    • The geographic areas affected.
    • The actions consumers should take.
    • The contact information for consumers to obtain further information.
    • The Company’s plan.
  • Regulatory Notification: Notify the appropriate regulatory agency (e.g., CPSC, FDA) of the recall, as required by law.
• 5.2. Notification and Communication:
  • Communication Strategy: Develop a communication strategy to inform consumers about the recall.
  • Methods of Communication: Utilize multiple communication channels, such as:
    • Press Releases: Issuing press releases to the media.
    • Website: Posting information about the recall on the Company's website.
    • Social Media: Using social media to communicate with consumers. [Follow the Company’s Social Media and Online Communication Policy - Link to Policy].
    • Direct Notifications: Notifying affected consumers directly, such as through email or mail.
    • Point of Sale: Notifying retail partners.
  • Transparency: Communicate the recall in a clear, concise, and transparent manner.
• 5.3. Product Retrieval and Remediation:
  • Consumer Instructions: Provide consumers with clear instructions on how to retrieve or remediate the recalled product.
  • Return Procedures: Establish a process for consumers to return the recalled product, including providing pre-paid shipping labels or other mechanisms for returning the product at no cost to the consumer.
  • Remedy Options: Offer consumers a remedy, such as a refund, replacement product, or repair.
  • Destruction: Ensure that recalled products are properly destroyed.
• 5.4. Monitoring and Reporting:
  • Tracking Returns: Track the number of products returned by consumers.
  • Tracking Compliance: Track and monitor the effectiveness of the recall and the response from consumers.
  • Reporting to Authorities: Provide regular reports to the regulatory agency, as required.

6. Third-Party Involvement

Nexly Corporation may use third-party vendors to assist with product recalls.

• 6.1. Vendor Selection: Select vendors with experience in product recalls, including logistics, warehousing, and customer service.
• Contractual Obligations: Enter into contracts with vendors that clearly define their responsibilities and obligations.
• Oversight: Monitor the performance of vendors to ensure that they are meeting their obligations.

7. Policy Review & Amendments

This Product Recall & Safety Policy will be reviewed and updated regularly to ensure its continued effectiveness and compliance with all applicable laws, regulations, and industry best practices.

• Review Frequency: This Policy will be reviewed at least [Specify Frequency, e.g., annually] or more frequently as needed, such as in response to changes in the Company's products, the regulatory environment, or industry best practices.
• Review Process: The review process will involve:
  • Input from Stakeholders: Seeking input from relevant stakeholders, including the Product Safety and Recall Committee (or equivalent), the Head of Quality, Legal Counsel, and other relevant departments.
  • Legal and Regulatory Review: Reviewing the Policy to ensure compliance with all applicable laws, regulations, and industry standards.
  • Performance Evaluation: Assessing the effectiveness of the product recall program, including the Company's recall response times and the effectiveness of the recall.
• Policy Amendments and Communication: Any amendments to this Policy will be approved by [Specify Approving Authority, e.g., the Board of Directors or the Executive Leadership Team] and communicated to all relevant employees through [Specify Communication Channels, e.g., company-wide email, intranet posting, training sessions].
• Policy Ownership: The Head of Quality, with support from the Legal Department, is responsible for maintaining and updating this Policy.

**Acknowledgement:** By working for Nexly Corporation, all employees are deemed to acknowledge that they are expected to follow all laws and company procedures related to product safety.