AFSL General Membership Meeting September 2011

John Rogers, Executive Director Introduction John Rogers, Executive Director

Report from the Board Alan Zoldan, President

Summary of CPSC Activities Andrew Kameros, Director of Compliance, CPSC Demar Granados, Compliance Officer, CPSC

Report on DOT Activities Ryan Posten, Assistant Associate Administrator, PHMSA

Review of AFSL Testing Programs John Rogers, Executive Director

Summary of Test Results

QIP Compliance Percentage By Year 2

Percentage Testing by Product Category 2010 4

TOP 10 VIOLATIONS 2010 Percentage of Total Violations 5

New Standards Approved by the Board

Standard for Crackling Strips Modification: 60 grams composition limit per device. Changed from 200 grams.　 Composition limit per retail pack is 60 grams. Implementation Date: November 1, 2011.

Requirements for Dragon Tails Classify as a Specialty Item. Subject to Fuse Burn Time and Fuse Side Ignition Requirements. Subject to all other requirements for Specialty Items, including 20 gram limit. Effective Date: Nov. 1, 2011.

Ban on Hexachlorobenzene Add to the list of Prohibited Chemicals for Consumer Fireworks. Implement a screen test.　 Effective date: January 1, 2012.

Domestic Testing Program AFSL/SGS to test fireworks manufactured or assembled in the U.S. Purpose: To permit importers to certify products to comply with CPSC certification requirements.

Domestic Testing Program Program consists of 3 elements: Assortments Assembled from Previously Certified Bulk Fireworks. Finished Fireworks Assembled from Previously Certified Components. Fireworks Fully Manufactured in the U.S.

Domestically Assembled Assortments No additional testing is required. Manufacturer applies previously issued stickers to assortment cartons and enters numbers into Security Log. Manufacturer files Certificate of Compliance in AFSL Database. Assortments are ready for distribution. AFSL performs periodic audits to verify compliance.

Products Manufactured from Components or Fully Manufactured in U.S. Additional testing is required. Samples will be collected by SGS from the manufacturer’s warehouse. Samples will be tested by SGS at Tulsa, OK lab. Manufacturer’s controller will assign and monitor the application of AFSL Stickers to the finished lot.

Products Manufactured in the U.S. Manufacturer files Certificate of Compliance in AFSL Database. Finished items now ready for distribution. AFSL performs periodic audits of records and facilities to assure compliance.

Domestic Program Costs Certification of assortments – US$0.07 per case. Testing of finished items assembled from certified components – US$0.42 per case. Testing of fully manufactured domestic products – US$0.75 per case. Sample collection fee - US$150 per man-day.

Soaring with SGS! September 14, 2011 Presented by: Joe Romeo – Global Key Account Manager September 14, 2011

Rex Liu Project/Business Manager Joined SGS in March 2011. Relocated to Liuyang to lead the AFSL Fireworks QIP. 10+ years experience with consumer products in quality assurance and project management. Strengthened bond (AFSL & SGS) in direct U.S./ China communications. Improved Technician Team Unity. Successful transition into the leadership role. Skilled and determined mindset to identify process enhancements/services.

Cass Ruan Technical Manager Transitioned to SGS in August 2009 from ITS. Based in Liuyang and dedicated to the AFSL Fireworks QIP. 12+ years working with the AFSL program. Manages technical training and support to the Technician Team. 2011 AFSL Annual Technician Training and Shipper/Factory Seminars. Engaged in development, coordination, and execution.

Manpower Review Strategy Liuyang Team Beihai Team Shenzhen Reserve TOTAL Aug, 09 26 6 9 41 Aug, 10 25 4 38 Aug, 11 29 42 Plan, 12 +2-3 +4 48-49 Display Program For 2012 TBD

Product Label Review Service Current Issue: AFSL has reported that 7.8% of all violations in 2010 were related to Label Wording. Program Goals: SGS will take a pro-active approach to work with Shippers/ Factories who regularly experience violations. SGS will use technically trained staff to support the service. SGS’ goal is to eliminate this violation category from AFSL’s KPI Index while increasing speed to market for Shippers/Factories.

Milestones Kicked off Domestic Program for Assortment & US Finished Product Testing. Hired Liuyang based Project Manager. 2011 Annual Technician Training Completed. Launched Factory Audit Process for the Display Program. Launch Abortive Inspection Process.

Next Steps Display Program Phase II Deployment: Product Evaluation; Container Loading Supervision. Continue momentum to drive continuous process improvement for all programs. Service Development Initiatives: Product Label Reviews.

Richard Shields, Treasurer Financial Report Richard Shields, Treasurer

Election of Directors John Rogers, Executive Director Kit Smith, General Counsel

Closing Remarks Alan Zoldan, President

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