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2018 Year-End Supplier Communications

Dear Supplier:

XTO Energy Inc. regularly undertakes a thorough review of its business practices, as well as those of its subsidiaries and affiliates that it operates (collectively, “XTO”).  As part of the review process, we believe it is important to communicate to our goods and services suppliers XTO’s expectations for the proper conduct of business activities with, or on behalf of, XTO.  As guided by our long-standing Ethics Policy and other policies of our Standards of Business Conduct available at http://corporate.exxonmobil.com/en/company/about-us/guiding-principles/standards-of-business-conduct, our principal aim is to ensure we conduct our business in accordance with the very highest standards.  In turn, we expect that our suppliers are committed to similar standards.  XTO’s standards cover safety, contract awards, personal business behavior, compliance with all applicable laws, adequate internal controls and the proper recording and reporting of all transactions.

We would appreciate your bringing this letter to the attention of those within your organization who have business contact with us.  It is your responsibility to communicate XTO’s business standards outlined herein to all subcontractors that work for you on XTO projects or sites. 

Compliance with Applicable Laws

It is a fundamental expectation that XTO and its suppliers will comply with all applicable laws, and that all financial settlements, reports and invoicing will correctly reflect the business transactions between us.  This includes compliance with the anti-corruption and antitrust laws of all local jurisdictions, states and countries in which operations are conducted.  No person in XTO is authorized to ask your organization to take any action on our behalf which is contrary to applicable law or XTO policies, including our Anti-Corruption and Antitrust Policies.  No XTO employee or supplier is authorized to make an improper payment, including facilitating payments, to any employee, official, agent, or instrumentality of any government, commercial entity, or individual in the conduct of XTO activity or business.

Safe Work Environment

XTO is committed to a safe, healthy, and productive work environment for our employees, contractor employees and others who access XTO property, sites and facilities.  XTO’s expectation is that you have and enforce an alcohol and drug program that at a minimum meets the requirements set forth in our contracts and includes, but is not limited to the exhibits/attachments regarding alcohol and drug requirements. 

  1. When on or handling XTO real or tangible personal property (“XTO Property”) or while providing services to XTO, your employees, agents, and subcontractors shall not be under the influence of, use, possess, distribute or sell alcoholic beverages, or illicit or controlled drugs for which the person has no valid prescription, nor shall they use, possess, distribute or sell drug paraphernalia, or misuse legitimate prescription or over-the-counter drugs;
  2. Prohibition while on XTO Property (including off-duty time) of Contractor Personnel use, possession, sale, manufacture, distribution, concealment, or transport of any Prohibited Substance, as such term is defined in the underlying agreement, which would include alcohol and potentially impairing medications used without a prescription or in a manner inconsistent with the prescription or directions for usage, e.g. some Prescription Drugs or over-the-counter medications or herbal medicines; 
  3. XTO reserves the right to conduct or require you to conduct an unannounced inspection on XTO Property (operated/controlled/leased) for drugs or drug paraphernalia and require any contractor, vendor or sub-contractor to test its employees for alcohol/drugs in accordance with the requirements in our contracts and accompanying exhibits/attachments.  Refusal to permit inspections or submit to or failing a drug test will result in the immediate removal from the location;
  4. Prohibition of any alcohol or drug-related paraphernalia used or designed for use in testing, packaging, storing, injecting, ingesting, inhaling or otherwise introducing into the human body any Prohibited Substance, any paraphernalia or substance used or designed for use to dilute, substitute, or adulterate any alcohol or drug test specimen or to otherwise obstruct the alcohol or drug testing process;
  5. Removal of Contractor Personnel from Company Work following non-compliance with any aspect of the Contractor program or the requirements set forth in the alcohol and drug exhibit in the agreement;
  6. Provides XTO the right, at its discretion, to perform periodic assessments of your compliance with the requirements of the contract exhibit regarding alcohol and drugs;
  7. Compliance with all applicable alcohol and drug laws and regulations;
  8. Concerning the panel for substances and levels to be tested, you may elect to use the panel identified in the contract exhibit/attachment regarding alcohol or drugs or a panel that exceeds the exhibit panel, except to the extent this panel is preempted by local law.
  9. Contractor may be required to perform background checks of employees and keep XTO informed of any violations that would require removal of such employees from an XTO assignment or premise. 

Commercial Transactions

XTO expects all financial settlements, reports and invoices to correctly reflect the business transactions between us.  All invoices to XTO should accurately reflect pricing, payment terms, and other provisions as stated in your contract with us.

We are committed that contracts and other awards are made in a fair manner.  We encourage you to contact us if you are aware of any practices which fail to meet these standards or if you have any concerns in this regard. 

We also ask you to be alert to the potential for Illegal Information Brokering where persons approach suppliers offering confidential information that is used to obtain business through corruption of the competitive bidding process.  Such practice is illegal and we ask that you report the occurrence of any such incident.

Gifts and Entertainment

Another key standard is our policy on the giving and receiving of gifts and entertainment.

  1. Those parties conducting business with, or on behalf of, XTO are expected to exercise good judgment in each case when considering giving or receiving gifts and entertainment.  The provision of gifts and entertainment must not be intended to create an improper advantage.
  2. Our gifts and entertainment guidelines restrict employees from receiving gifts or favors which exceed a nominal value or any extravagant or frequent entertainment from individuals, companies or firms who do business, or seek to do business, with us.
  3. While we do not envision any gifts would be made to third parties, you should be equally prudent on the extremely rare occasion you might provide appropriate gifts or entertainment to third parties when conducting business on behalf of XTO.

If you have not already done so, please ensure you adopt adequate safeguards, and have in place policies, procedures, and/or controls to ensure your activities related to commercial interactions and interactions with government officials fully comply with applicable anti-corruption laws and the expectations of XTO outlined herein.

U.S. Imposed Sanctions

While you may be organized outside of the United States, it is imperative that, in providing goods and services to XTO affiliates worldwide, you not deal with any entities, organizations, persons, or vessels with which a U.S. person could not deal and that you not provide to XTO or its affiliates any goods or services in which a U.S. person could not deal, for example goods manufactured or extracted in a country subject to comprehensive U.S. sanctions.  The countries and territories currently under comprehensive U.S. sanctions are Crimea, Cuba, Iran, North Korea, and Syria. The U.S. also imposes comprehensive sanctions against persons, entities, and vessels on the U.S. Treasury Department Office of Foreign Assets Control’s List of Specially Designated Nationals and Blocked Persons (SDNs), including any entities or vessels owned directly or indirectly, individually or in the aggregate, 50% or more by one or more SDNs, and it imposes more limited sanctions against Russia.  We fully expect you to be aware of applicable sanctions and export controls, including relevant EU or other applicable sanctions and export controls and, in providing goods or services to XTO affiliates worldwide. We expect that you not deal with any sanctioned party or provide to XTO or its affiliates any goods or services with which a U.S. person cannot deal.  Should you have any questions about what entities, organizations, persons, or vessels are sanctioned, please consult with an attorney experienced in such matters.

Data Privacy and Protection of Personal Information 

Please take appropriate steps to protect information (electronic and hardcopy) and information systems.  Protection of information and cybersecurity are constantly evolving to recognize new threats and technologies.  You should maintain appropriate data protection and cybersecurity measures based on professional guidance and best practices.

If there are circumstances where information related to XTO is compromised or potentially compromised, you should promptly bring such circumstances to our attention.  Please contact XTO if you have any suspicions as to whether an email purportedly from XTO is actually from our company.  Also, we request that you be alert to cybersecurity attacks that rely on personal inattention, such as “phishing” attacks or other suspicious emails containing attachments or links that could potentially compromise computer systems.

More and more countries around the world are adopting data protection or data privacy laws, which regulate the collection and processing of personal information.  These laws deal not only with how such information is collected, but also the purpose(s) for which it is used.  In addition, in many countries there are also particular restrictions on how personal information is transferred across national borders and to third parties.

XTO is committed to protecting the personal information of its employees, contractors, customers, vendors and other third parties with whom it deals. If you have not already done so, please ensure you adopt adequate safeguards to keep all personal data used pursuant to your agreement with XTO secure, and you have in place procedures to ensure your activities fully comply with applicable data privacy and data protection laws.

We also ask you to be alert to the potential for Illegal Information Brokering where persons approach suppliers offering confidential information that is used to obtain business through corruption of the competitive bidding process. Such practice is illegal and we ask that you report the occurrence of any such incident.

We are committed that contracts and other awards are made in a fair manner. We encourage you to contact us if you are aware of any practices which fail to meet these standards or if you have any concerns in this regard.

Thank you for your attention to these important business practices.  Should you at any time have questions or concerns as to their application, please consult your XTO management contact*.

* Alternatively, you may call ExxonMobil’s corporate “hot line” at either 1.800.963.9966 (inside the United States) or 001.972.444.1990 (collect call outside the United States).

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