Approved Code No. 84 — Supplement No. 20 
 
 Registry No. 1104—09 
 
 NATIONAL RECOVERY ADMINISTRATION 
 
 SUPPLEMENTARY 
 CODE OF FAIR COMPETITION 
 
 FOR THE 
 
 MACHINE SCREW NUT 
 MANUFACTURING INDUSTRY 
 
 (A Division of the Fabricated Metal Products 
 
 Manufacturing and Metal Finishing 
 
 and Metal Coating Industry) 
 
 AS APPROVED ON MAY 5, 1934 
 
 •* . — t !■"»' 
 
 UNIV. <tf Pl m. 
 
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 U.S. BEPOeiTOflY 
 
 UNITED STATES 
 
 GOVERNMENT PRINTING OFFICE 
 
 WASHINGTON : 1934 
 
 For sale by the Superintendent of Documents, Washington, D.C. 
 
 Price 5 cents 
 
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Approved Code No. 84 — Supplement No. 20 
 SUPPLEMENTARY CODE OF FAIR COMPETITION 
 
 FOR THE 
 
 MACHINE SCREW NUT MANUFACTURING 
 INDUSTRY 
 
 As Approved on May 5, 1934 
 
 ORDER 
 
 Approving Supplementary Code or Fair Competition for the 
 Machine Screw Nut Manufacturing Industry 
 
 a division of the fabricated metal products manufacturing and 
 metal finishing and metal coating industry 
 
 An application having been duly made pursuant to and in full 
 compliance with the provisions of Title I of the National Industrial 
 Recovery Act, approved June 16, 1933, and in accordance with the 
 provisions of Section I of Article VI of the Basic Code for the 
 Fabricated Metal Products Manufacturing and Metal Finishing and 
 Metal Coating Industry, approved November 2, 1933, for approval 
 of a Supplementary Code of Fair Competition for the Machine 
 Screw Nut Manufacturing Industry, and hearing having been duly 
 held thereon ; and the annexed report on said Supplementary Code, 
 containing findings with respect thereto, having been made and 
 directed to the President : 
 
 NOW. THEREFORE, on behalf of the President of the United 
 States, I, Hugh S. Johnson, Administrator for Industrial Recovery, 
 pursuant to authority vested in me by Executive Orders of the Presi- 
 dent, including Executive Order No. 6543-A, dated December 30, 
 1933, and otherwise ; do hereby incorporate by reference said an- 
 nexed report and do find that said Supplementary Code complies in 
 all respects with the pertinent provisions and will promote the policy 
 and purposes of said Title of said Act; and do hereby order that 
 said Supplementary Code of Fair Competition be and it is hereby 
 approved; provided however that the provisions of Article V, Sec- 
 tion 2, insofar as they prescribe a waiting period between the filing 
 with the Code Authority or such agency as may be designated in the 
 Code, and the effective date of price lists, as originally filed and/or 
 revised price lists or revised terms and conditions of sale, be and they 
 hereby are stayed pending my further Order. 
 
 Hugh S. Johnson, ■ 
 Administrator for Industrial Recovery. 
 
 Approval recommended : 
 A. R. Glancy, 
 
 Division Administrator. 
 
 Washington, D.C., 
 
 May 5, 1934. 
 
 57213°— 544-34 34 (1) 
 
REPORT TO THE PRESIDENT 
 
 The President, 
 
 The White House. 
 Sir: This is a report on the Supplementary Code of Fair Com- 
 petition for the Machine Screw Nut Manufacturing Industry, a 
 division of the Fabricated Metal Products Manufacturing and Metal 
 Finishing and Metal Coating Industry, the hearing having been con- 
 ducted thereon in Washington, D.C., February 2, 1934, in accordance 
 with the provisions of Title I of the National Industrial Recovery 
 Act. 
 
 GENERAL STATEMENT 
 
 The Machine Screw Nut Manufacturing Industry, being truly 
 representative of this division of the Fabricated Metal Products 
 Manufacturing and Metal Finishing and Metal Coating Industry, 
 has elected to avail itself of the option of submitting a Supple- 
 mentary Code of Fair Competition, as provided for in Section 1 
 of Article VI of the Basic Code, for the Fabricated Metal Products 
 Manufacturing and Metal Finishing and Metal Coating Industry 
 approved by j'ou on the second day of November, 1933. 
 
 RESUME OF THE CODE 
 
 Article I states the purpose of the Supplementary Code. 
 
 Article II accurately defines specific terms employed in the Sup- 
 plementary Code. 
 
 Article III. This Industry is a division of the Fabricated Metal 
 Products Manufacturing and Metal Finishing and Metal Coating 
 Industry and the labor provisions of its Basic Code, as approved 
 November 2, 1933, are the labor provisions of this Supplementary 
 Code. 
 
 Article IV establishes a Supplementary Code Authority consisting 
 of five (5) members to be elected by the members of the Industry 
 at a meeting called by the Temporary Supplementary Code Author- 
 ity, and gives the Administrator the authority to appoint one addi- 
 tional member without vote and provides machinery for obtaining 
 statistics and the administration of the Supplementary Code. 
 
 Article V provides for methods of setting up and revising price 
 lists. 
 
 Article VI provides for determining the lowest reasonable costs of 
 the products of this Industry. 
 
 Article VII sets forth the unfair trade practices of this Sup- 
 plementary Code which has been especially designed to offset unfair 
 competition in this division of the Industry. 
 
 Article VIII provides against monopolies and monopolistic 
 practices. 
 
 (2) 
 
Article IX contains the mandatory provisions contained in Sec- 
 tion 10 (b) and also provides for the submission of proposed amend- 
 ments to the Supplementary Code. 
 
 Article X recognizes that price increases be limited to actual ad- 
 ditional increases in the seller's costs. 
 
 Article XI states the effective date and duration of this Supple- 
 mentary Code. 
 
 FINDINGS 
 
 The Deputy Administrator in his final report to me on said Sup- 
 plementary Code having found as herein set forth and on the basis 
 of all the proceedings in this matter: 
 
 I find that : 
 
 (a) Said Supplementary Code is well designed to promote the 
 policies and purposes of Title I of the National Industrial Recovery 
 Act, including removal of obstructions to the free flow of interstate 
 and foreign commerce which tend to diminish the amount thereof and 
 will provide for the general welfare'by promoting the organization 
 of industry for the purposes of cooperative action among the trade 
 groups, by inducing and maintaining united action of labor and 
 management under adequate governmental sanctions and supervision, 
 by eliminating unfair competitive practices, by promoting the fullest 
 possible utilization of the present productive capacity of industries, 
 by avoiding undue restriction of production (except as may be tem- 
 porarily required), by increasing the consumption of industrial and 
 agricultural products through increasing purchasing power, by re- 
 ducing and relieving unemployment, by improving standards of 
 labor, and by otherwise rehabilitating industry. 
 
 (b) Said Industry normally employs not more than 50,000 em- 
 ployees; and is not classified by me as a major industry. 
 
 (c) The Supplementary Code as approved complies in all respects 
 with the pertinent provisions of said Title of said Act, including 
 without limitation Subsection (a) of Section 3, Subsection (a) of 
 Section 7, and Subsection (b) of Section 10 thereof; and that the 
 applicant group is an industrial group truly representative of the 
 aforesaid Industry; and that said group imposes no inequitable re- 
 strictions on admission to membership therein. 
 
 (d) The Supplementary Code is not designed to and will not 
 permit monopolies or monopolistic practices. 
 
 (e) The Supplementary Code is not designed to and will not elim- 
 inate or oppress small enterprises and will not operate to discriminate 
 against them. 
 
 (f ) Those engaged in other steps of the economic process have not 
 been deprived of the right to be heard prior to approval of said 
 Supplementary Code. 
 
 For these reasons, therefore, I have approved this Supplementary 
 Code. 
 
 Respectfully, 
 
 Hugh S. Johnson, 
 
 Administrator. 
 May 5, 1934. 
 
SUPPLEMENTAEY CODE OF FAIR COMPETITION FOR 
 THE MACHINE SCREW NUT MANUFACTURING IN- 
 DUSTRY 
 
 A DIVISION OF THE FABRICATED METAL PRODUCTS MANUFACTURING AND 
 METAL FINISHING AND METAL COATING INDUSTRY 
 
 Article I — Purposes 
 
 To effectuate the policy of Title I of the National Industrial 
 Recovery Act, the following provisions are established as a Supple- 
 mentary Code of Fair Competition for the Machine Screw Nut 
 Manufacturing Industry, pursuant to Article VI of the Basic Code 
 of Fair Competition for the Fabricated Metal Products Manufac- 
 turing and Metal Finishing and Metal Coating Industry, approved 
 by the President on the 2nd day of November, 1933, and the provi- 
 sions of this Supplementary Code shall be the standard of fair 
 competition for such Industry and shall be binding upon every 
 member thereof. 
 
 Article II — Definitions 
 
 Section 1. The terms " President," "Act " and "Administrator," 
 as used herein shall mean respectively, the President of the United 
 States, the National Industrial Recovery Act, and the Administrator 
 for Industrial Recovery under said Act. 
 
 Section 2. The term " Machine Screw Nuts " is defined as all 
 hexagon, square or other shapes and styles of nuts stamped, punched 
 and/or upset from all metals made for all sizes of Machine Screws 
 as defined in the Supplementary Code of Fair Competition of the 
 Machine Screw Manufacturing Industry, except (a) those nuts 
 which are manufactured and/or sold for use with or on those 
 products which fall within the following definition : 
 
 " The term ' products ' means and includes bolts, nuts and/or 
 rivets fabricated from ferrous metals and miscellaneous headed, 
 threaded, punched and/or bent products fabricated from ferrous 
 metals by the producers of bolts, nuts and/or rivets with the use of 
 equipment that is used in the production of bolts, nuts, and/or rivets, 
 but not, however, including (a) cap screws, (b) set screws, (c) 
 machine screws as defined in the Supplementary Code of the Ma- 
 chine Screw Manufacturing Industry, (d) socket screws, (e) wood 
 screws, (f) machine screw nuts as defined in the Supplementary 
 Code of the Machine Screw Nut Manufacturing Industry, (g) screw 
 machine products as defined in the Supplementary Code of the 
 Screw Machine Products Manufacturing Industry, (h) drive screws 
 shorter than four and one-half inches in length and smaller than 
 seven-sixteenths of an inch in diameter, (i) builders finishing hard- 
 
 (4) 
 
ware and locks, and (j) patented 'Grip Lock Nuts' or any of 
 them." 
 
 also excepting (b) screw machine products as defined in the Supple- 
 mentary Code of the Screw Machine Products Manufacturing 
 Industry. 
 
 Section 3. The term " product " means and includes Machine 
 Screw Nuts as that term is defined herein. 
 
 Section 4. The term " Industry " means and includes the business 
 of manufacturing Machine Screw Nuts for sale. 
 
 Section 5. The term " Member of the Industry " as used herein 
 includes, but without limitation, any individual, partnership, associa- - 
 tion, corporation or other form of enterprise engaged in the Industry 
 either as an employer or on his or its own behalf. 
 
 Section 6. The term " employee " as used herein includes anyone 
 engaged in the Industry in any capacity receiving compensation for 
 his services, irrespective of the nature or method of payment of such 
 compensation, except a member of the Industry. 
 
 Section 7. The term " employer " as used herein includes anj'one 
 b} r whom any such employee is compensated or employed. 
 
 Section 8. The term " Basic Code " as used herein is defined to 
 mean the Basic Code of Fair Competition for the Fabricated Metal 
 Products Manufacturing and Metal Finishing and Metal Coating 
 Industry as approved by the President on the 2nd day of November, 
 1933. 
 
 Section 9. The term " member of the Code " as used herein shall 
 mean any member of the Industry who shall have assented to the 
 provisions of this Supplementary Code by instrument in writing 
 duly filed with the Secretary. 
 
 Section 10. The term " Supplementary Code Authority " as used 
 herein is defined to mean the agency which is to administer this 
 Supplementary Code as hereinafter provided. 
 
 Section 11. The term " Bureau " as used herein is defined to mean 
 the Machine Screw Nut Bureau, or its successor. 
 
 Section 12. The term " Executive Committee " as used herein is 
 defined to mean Executive Committee of the Machine Screw Nut 
 Bureau. 
 
 Section 13. The term " Secretary " as used herein is defined to 
 mean Secretary of the Machine Screw Nut Bureau, or such other 
 impartial and confidential agency as the Supplementary Code 
 Authority may designate. 
 
 Article III — Employment Provisions 
 
 This Industry is a division of the Fabricated Metal Products 
 Manufacturing and Metal Finishing and Metal Coating Industry 
 and the wage, hour and labor provisions in Article III of its basic 
 code as approved by the President November 2, 1933, including Sec- 
 tion 1 of said Article III by which the provisions of Subsections (1), 
 (2) and (3) of Section 7 (a) of Title I of the Act are made condi- 
 tions of this Code, are specifically incorporated herein and made a 
 part hereof as the wage, hour and labor provisions of this Supple- 
 mentary Code. 
 
Article IV — Organization and Administration 
 
 Section 1. During the period not to exceed sixty (60) days follow- 
 ing the effective date, the Executive Committee shall constitute a 
 Temporary Supplementary Code Authority, who shall have all the 
 powers and duties of the Supplementary Code Authority herein set 
 forth, until the Supplementary Code Authority is elected. There 
 shall be constituted within the sixty-day period a Supplementary 
 Code Authority consisting of five (5) members to be elected by the 
 members of the Industry, as hereinafter provided, at a meeting 
 called by the Temporary Supplementary Code Authority, upon ten 
 (10) days' notice sent by registered mail to all known members of 
 the Industry whose names can be ascertained after diligent search, 
 who may vote either in person or by proxy. The members of the 
 Supplementary Code Authority first elected shall serve until the 
 following annual meeting of the Bureau and/or until their succes- 
 sors are elected, and thereafter, members of the Supplementary Code 
 Authority shall be elected immediately after each annual meeting of 
 the Bureau to serve until their successors are elected, and any mem- 
 ber shall be eligible for re-election. Notice of each election shall be 
 sent in the manner above provided. The membership of the Supple- 
 mentary Code Authority shall be made up as follows : 
 
 (a) 1. Four (4) members who shall be members of the Industry 
 elected by a majority vote of the members of the Bureau present in 
 person or represented by proxy, each member to have one vote ; 
 
 2. At any time upon the request in writing of twenty-five percent 
 (25%) of the members of the Bureau, the Supplementary Code 
 Authority shall call a meeting of the members of the Bureau upon 
 the notice above provided, for the purpose of electing successors to 
 such four members of the Supplementary Code Authority to be 
 elected in the same manner as provided in Sub-Paragraph 1 of this 
 Paragraph (a) ; 
 
 (b) One (1) member who is not a member of the Bureau elected 
 by majority vote of the members of the Industry not members of 
 the Bureau, present in person or represented by proxy, each member 
 to have one vote; 
 
 (c) A vacancy in the membership of the Supplementary Code 
 Authority may be filled by majority vote of the remaining members 
 of the Supplementary Code Authority; 
 
 (d) In addition to the above the Administrator may appoint one 
 (1) representative without vote and without expense to the Industry 
 unless the Supplementary Code Authority agrees to pay such expense 
 to serve on said Supplementary Code Authority in the administra- 
 tion of this Supplementary Code. Said representative shall be given 
 reasonable notice of all meetings of the Supplementary Code 
 Authority. 
 
 Section 2. Any Association/Institute and/or Bureau directly or 
 indirectly participating in the selection or activities of the Supple- 
 mentary Code Authority shall (1) impose no inequitable restrictions 
 on membership, and (2) submit to the Administrator true copies of 
 its Articles of Association, By-Laws, Regulations and any amend- 
 ments when made thereto, together with such other information as 
 
to membership, organization, and activities as the Administrator 
 may deem necessary to effectuate the purposes of the Act. 
 
 Section 3. In order that the Suplementary Code Authority shall, 
 at all times, be truly representative of the Industry and in other 
 respects comply with the provisions of the Act, the Administrator 
 may prescribe such Hearings as he may deem proper; and, thereafter, 
 if he shall find that the Supplementary Code Authority is not truly 
 representative or does not in other respects comply with the provi- 
 sions of the Act, may require removal of any or all of the members 
 thereof and/or may make an appropriate modification or modifica- 
 tions in the method of selection of the Supplementary Code 
 Authority. 
 
 Section 4. The Supplementary Code Authority is hereby con- 
 stituted the Agency to administer the provisions of this Supplemen- 
 tary Code and to collect and distribute all statistical reports of the 
 Industry. With a view to keeping the President informed as to the 
 observance or non-observance of this Supplementary Code, said 
 agency shall collect, through the Secretary, such statistics as called 
 for by the President and/or the Administrator and send them in 
 such form as the President and/or the Administrator may require 
 to the Fabricated Metal Products Federation, or successor organiza- 
 tion, as the agency administering said Basic Code. All individual 
 reports shall be treated as confidential by the Secretary and shall 
 not be disclosed to any member of the Industry or any other party 
 except where necessary in the enforcement of this Code and except 
 to such governmental agencies as may be directed by the Adminis- 
 trator. 
 
 Section 5: Said Agency shall also from time to time furnish to 
 the Basic Code Authority, designated in said Basic Code such in- 
 formation as may be required to be furnished under the terms of 
 said Basic Code. 
 
 Section 6. The Supplementary Code Authority shall have power 
 from time to time to require each member of the Industry to furnish 
 to the Secretary such information concerning the production, ship- 
 ments, sales and orders of such member and the hours of labor, rates 
 of pay and other conditions of employment at the plant or plants of 
 such member and such other information as the said Supplementary 
 Code Authority shall deem necessary or proper in order to effectuate 
 the purposes of this Supplementary Code and the policy of the Act. 
 All individual reports shall be treated as confidential by the Secre- 
 tary and shall not be disclosed to any member of the Industry or any 
 other party except where necessary in the enforcement of this Code 
 and except to such governmental agencies as may be directed by 
 the Administrator. 
 
 Section 7. The Supplementary Code Authority may require that 
 any such information be furnished periodically at such time as it 
 shall specify and may require that any or all information furnished 
 be sworn to or otherwise certified or authenticated as it shall pre- 
 scribe. Failure of any member of the Industry promptly to furnish 
 to the Secretary information required by the said Supplementary 
 Code Authority and substantially in the form prescribed by it shall 
 constitute a violation of the Code. The Supplementary Ccfde Au- 
 thority shall not require any information regarding trade secrets. 
 
8 
 
 Section 8. Any or all information furnished to the Secretary by 
 any corporate member of the Industry specifically assenting hereto 
 pursuant to the provisions of this Code shall be subject to verifica- 
 tion by an examination of the pertinent or necessary books, accounts 
 and records of such member by the Secretary or by any accountant 
 or accountants or other person or persons designated by the Supple- 
 mentary Code Authority (none of whom shall be connected with any 
 member of the Industry) and shall be so checked for such purpose, 
 if the Supplementary Code Authority shall require it. The cost of 
 each such examination shall be treated as an expense of administering 
 the Code. 
 
 Section 9. All members of the Industry are subject to the juris- 
 diction of the Supplementary Code Authority; shall be entitled to 
 participate in and share the benefits of the Supplementary Code 
 Authority; shall be entitled to vote in the selection of the Supple- 
 mentary Code Authority as provided in Section 1 of this Article; 
 and shall pay to the Secretary as the agent of the Supplementary 
 Code Authority their reasonable share of the expenses of the admin- 
 istration of this Supplementary Code, such reasonable share to be 
 determined by the Supplementary Code Authority, subject to review 
 by the Administrator, on the basis of volume of business and/or such 
 other factors as may be deemed equitable by the Supplementary Code 
 Authority. 
 
 Section 10. Nothing contained in this Supplementary Code shall 
 be deemed to constitute the members of the Supplementary Code 
 Authority partners for any purpose whatsoever. Nor shall any 
 member of the Supplementary Code Authority be liable in any man- 
 ner to anyone for any act of any other member, officer, agent or 
 employee of the Supplementary Code Authority. Nor shall any 
 member of the Supplementary Code Authority, exercising reasonable 
 diligence in the conduct of his duties hereunder, be liable to anyone 
 for any action or omission to act under this Code, except for his own 
 willful misfeasance or non-feasance. 
 
 Section 11. The Supplementary Code Authority may adopt, sub- 
 ject to the approval of the Administrator, and thereafter all members 
 of the Industry shall maintain, uniform credit terms. Such credit 
 terms shall clearly appear on all quotations, invoices and acceptances 
 of orders. 
 
 Section 12. If any member of the Industry as defined herein is 
 also a member of any other Industry, the provisions of this Code 
 shall apply to and affect only that part of his business which is 
 included in the Industry. 
 
 Section 13. The Supplementary Code Authority shall without 
 any limitation on the foregoing have the following further general 
 powers and duties, subject to such rules and regulations as the Ad- 
 ministrator may prescribe: 
 
 (a) To insure the execution of the provisions of this Supplemen- 
 tary Code and provide for the compliance of the Industry with the 
 provisions of the Act; 
 
 (b) To adopt by-laws and rules and regulations for its procedure 
 and for the administration of the Supplementary Code ; 
 
 (c) To obtain from members of the Industry such information 
 and reports as are required for the administration of the Supple- 
 
mentary Code. In addition to information required to be submitted 
 to the Supplementary Code Authority, all or any of the persons sub- 
 ject to this Supplementary Code shall furnish such statistical in- 
 formation as the Administrator may deem necessary for the purposes 
 recited in Section 3 (a) of the Act to such Federal and State agencies 
 as the Administrator may designate. Provided that nothing in this 
 Supplementary Code shall relieve any member of the Industry of 
 any existing obligations to furnish reports to any government 
 agency ; 
 
 (d)' To use such trade associations and other agencies as it deems 
 proper for the carrying out of any of its activities provided for 
 herein, provided that nothing herein shall relieve the Supplementary 
 Code Authority of its duties or responsibilities under this Supple- 
 mentary Code and that such trade associations and agencies shall 
 at all times be subject to and comply with the provisions hereof; 
 
 (e) To make recommendations to the Administrator for the co- 
 ordination of the administration of this Supplementary Code with 
 such other codes, if any, as may be related to the Industry; 
 
 (f ) To secure froin members of the Industry an equitable and 
 proportionate payment of the reasonable expenses of maintaining 
 the Supplementary Code Authority and its activities; 
 
 (g) To cooperate with the Administrator in regulating the use 
 of any N.R.A. insignia solely by those members of the Industry 
 who have assented to, and are complying with, this Supplementary 
 Code ; 
 
 (h) To recommend to the Administrator further fair trade prac- 
 tice provisions to govern members of the Industry in their relations 
 with each other or with other industries and to recommend to the 
 Administrator measures for industrial planning, including stabili- 
 zation of employment. 
 
 Section 14. If the Administrator believes that any action of the 
 Supplementary Code Authority or any agency thereof is unfair 
 or unjust or contrary to the public interest, the Administrator may 
 require that such action be suspended to afford an opportunity for 
 investigation of the merits of such action. Further action by such 
 Supplementray Code Authority or agency regarding the matter 
 complained of may be taken if approved by the Administrator but 
 shall not be taken if disapproved by the Administrator within 
 thirty (30) days of notice to him of intention to proceed with such 
 action. 
 
 Article V — Price Lists 
 
 Sectiox 1. The Supplementary Code Authority may require that 
 each member of the Industry who manufactures and sells any prod- 
 uct of the Industry not used by himself in the manufacture of an- 
 other product, shall file with the Secretary and publish a net price 
 list and/or a price list and discount sheet individually prepared by 
 him showing his current prices and/or prices and discounts, and 
 other conditions of sale, including discounts for various classes of 
 customers or for quantity. 
 
 Sectiox 2. The Secretary shall immediately send copies thereof 
 to all other members of the Code. Such price lists, discounts and 
 conditions may be revised from time to time thereafter, and notifi- 
 
10 
 
 cation of such revision shall be filed with the Secretary and shall 
 be made available to all interested parties. Such revision shall be 
 deemed filed and effective within the meaning of this provision when 
 telegraphic acknowledgment of receipt of such revision shall have 
 been received by the person making such revision, and copies of 
 such revision shall be immediately sent by the Secretary to all other 
 members of the Code, who thereupon may file, if they so desire, re- 
 visions of their price lists, discounts and conditions which may be- 
 come effective upon the date when the revised price data first filed 
 shall go into effect or at a later specified date. 1 
 
 Section 3. No member of the Industry shall sell directly or in- 
 directly through an affiliated company, or otherwise, by any means 
 whatever any product of the Industry at a price lower, or at discounts 
 greater, or on conditions more favorable to the buyer than those 
 provided in his current price data filed with the Secretary as above 
 provided; provided, however, that at any time a member of the 
 Industry may meet the lawful price, and conditions of any com- 
 petitor for products of an equal grade or quality, or for products 
 competing with products of the Industry. Any such meeting of 
 a lawful price by a member of the Industry must be reported at once 
 by such member to the Secretarj^. An " affiliated company " for the 
 purpose of this section means a company the majority of whose 
 voting stock is owned or controlled by a member of the Industry. 
 For all purposes of this Article a delivery of any product made pur- 
 suant to a contract of a sale shall be regarded as a sale thereof made 
 at the time of the making of such contract. Lawful price for the 
 purposes of this Section is defined to mean any price which a mem- 
 ber of the Industry may make pursuant to this Code, or any price 
 which a competitor of any member of the Industry may make with- 
 out violating any provision of any Code or Codes to which such 
 competitor is subject or without violating any Federal Law, State 
 Law, or the Law of any political subdivision thereof. 
 
 Section 4. No provision of this Code relating to prices or terms of 
 selling, shipping or marketing shall apply to export trade or sales 
 or shipments for export within the meaning of the term " export 
 trade " as it is used in the Export Trade Act. 
 
 Article VI — Sales Below Reasonable Cost 
 
 Notwithstanding any other provisions of this Supplementary 
 Code, when the Supplementary Code Authority determines that an 
 emergency exists in this Industry and that the cause thereof is 
 destructive price-cutting such as to render ineffective or seriously 
 endanger the maintenance of the provisions of this Supplementary 
 Code, the Supplementary Code Authority may cause to be deter- 
 mined the lowest reasonable cost of the products of this Industry, 
 such determination to be subject to such notice and hearing as the 
 Administrator may require. The Administrator may approve, 
 disapprove, or modify the determination. Thereafter, during the 
 period of the emergency, it shall be an unfair trade practice for any 
 member of the Industry to sell or offer to sell any products of the 
 Industry for which the lowest reasonable cost has been determined 
 
 1 See paragraph 2 of order approving this Code. 
 
11 
 
 at such prices or upon such terms or conditions of sale that the buyer 
 will pay less therefore than such lowest reasonable cost of such 
 products. 
 
 When it appears that conditions have changed, the Supplementary 
 Code Authority, upon its own initiative or upon the request of any 
 interested party, shall cause the determination to be reviewed. 
 
 Article VII — Unfair Practices 
 
 For all purposes of this Supplementary Code the following de- 
 scribed acts shall constitute unfair practices. Such unfair practices 
 shall be deemed to be unfair methods of competition in commerce 
 within the meaning of the Federal Trade Commission Act as 
 amended, and any member of the Industry who shall directly or 
 indirectly through any officer, employee, agent or representative 
 use or employ any of such unfair practices .-diall be guilty of a 
 violation of this Code. 
 
 A. The provisions of Article V paragraphs B to G, inclusive, of 
 the Basic Code are a part of this Supplementary Code to the same 
 extent as though here repeated and set forth at length. 
 
 B. The sale or exchange of any product in whole or in part below 
 the cost of such product to the particular member of the Industry, 
 such cost to be computed according to a cost formula to be prescribed 
 or approved by the Supplementary Code Authority and approved 
 by the Administrator; 
 
 Provided, however, that dropped lines, seconds or inventories 
 which must be converted into cash to meet emergency needs may 
 be disposed of in such manner and on such terms and conditions as 
 are necessary to move such products into buyers' hands notwith- 
 standing any other provisions of this Code, provided, the Secre- 
 tary shall have been notified, at least ten (10) days in advance, of 
 such intended sale or other disposition and of the description, quan- 
 tity and price thereof with the reasons therefor and provided the 
 Secretary on the direction of the Supplementary Code Authority 
 has not before the termination of such ten day period, in writing, 
 disapproved the proposed disposal; such disapproval shall be only 
 on the ground of misrepresentation of facts; 
 
 Provided, further, that selling below cost (as defined in Sub- 
 Paragraph 1 of this Paragraph B) to meet existing competition on 
 products of equivalent design, character, quality or specifications 
 shall not be deemed a violation of this Article. 
 
 C. Using or substituting any material superior in quality to that 
 specified by the purchaser of any product, for the purpose of in- 
 fluencing purchase or future purchase. 
 
 D. Cancelling in whole or in part, or permitting the cancellation 
 in whole or in part, of any contract of sale of any product, except 
 for justifiable cause or a fair consideration. 
 
 E. Inducing or attempting to induce the breach of any provision 
 of a contract to which a member of the Code is a party. This 
 clause shall not be construed to apply to employment contracts. 
 
 F. Aiding or abetting any person, firm, association of corporation 
 in any unfair practice. 
 
12 
 
 G. Offering or giving to any purchaser of any product any guar- 
 anty or protection in any form against decline in the market price 
 of such product after the date of shipment. 
 
 H. Selling or offering to sell special Machine Screw Nuts be- 
 low the lawful price of the corresponding or the next larger stand- 
 ard or listed size Machine Screw Nut determined in accordance with 
 the provisions of Article V hereof, plus the cost of the special fea- 
 ture or features. 
 
 I. Soliciting by any member of the Industry the pooling of orders 
 from several buyers in a manner to give the buyers advantage of 
 more favorable price or terms than those to which the buyers would 
 be entitled individually. 
 
 J. Consigning merchandise for any reason whatsoever, except to 
 a wholly owned or controlled subsidiary, or except under circum- 
 stances to be defined by the Supplementary Code Authority where 
 peculiar circumstances in the Industry require the practice. 
 
 K. Making contracts of sale that permit the buyer to cancel and/or 
 provide for a reduced price in event of a market decline, but which 
 do not- permit the seller to cancel and/or do not provide for an 
 enhanced price, in the event of a market rise. 
 
 L. Making a contract requiring delivery of specified quantity or 
 quantities in specified time, if demanded by buyer, but not requiring 
 the buyer to accept such quantity or quantities within the specified 
 time. 
 
 M. Making contracts at a specified price for an unspecified quan- 
 tity for delivery as demanded by the buyer during the period unless 
 the contract is for a fixed percentage of the total consumption re- 
 quirements of the purchaser of the particular product and unless 
 it is agreed in such contract that specifications placed during the 
 last third period thereof shall not exceed the total pieces specified 
 for shipment during the first two-thirds thereof; or making any 
 such unspecified quantity contract above described except on a 
 standard form or forms approved by the Supplementary Code 
 Authority and the Administrator; and failing to file with the 
 Secretary a copy of each and every different form of contract 
 entered into by a member of the Industry within five (5) days after 
 entering into a contract in such form. 
 
 N. Making contracts for periods in excess of three months (all 
 contracts to expire not later than the last days of March, June, 
 September or December) or quoting on or making any quarterly 
 contract more than thirty (30) days prior to the first day of the 
 calendar quarter covered by the contract, or shipping pursuant to 
 any contract more than fifteen (15) days after the expiration 
 thereof, or as soon thereafter as seller can manufacture and ship the 
 same, or making contracts containing an option of extension or 
 renewal on the part of either buyer or seller. 
 
 O. Accepting orders for deliveries extending beyond four (4) 
 months from date of order. 
 
 P. Offering any article by price or otherwise, in a manner to 
 influence the purchase of another article. 
 
 Q. Appointing, continuing to employ or paying a commission, 
 salary or any other form of compensation to a jobber or dealer 
 or syndicate buyer of any character as an agent, except under cir- 
 
13 
 
 cumstances where such jobber, dealer or syndicate buyer acts clearly 
 as an agent and does not simultaneously perform the functions of 
 a jobber, dealer or syndicate buyer in a specific transaction or 
 transactions, or entering into any kind of an exclusive territory ar- 
 rangement with a jobber, dealer or syndicate buyer. 
 
 H. Continuing to employ any salesman, agent or employee who 
 shall give any or all of his commission to any purchaser. 
 
 Article VIII — Monopolies 
 
 No provision of this Supplementary Code shall be applied so as 
 to permit monopolies or monopolistic practices, or to eliminate, op- 
 press or discriminate against small enterprises. 
 
 Article IX — Modifications 
 
 Section 1. This Supplementary Code and all the provisions thereof 
 are expressly made subject to the right of the President, in accord- 
 ance with provisions of subsection (b) of Section 10 of the Act, from 
 time to time, to cancel or modify any order, approval, license, rule 
 or regulation issued under said Act. 
 
 Section 2. This Supplementary Code, except as to provisions re- 
 quired by the Act, may be modified or amended on the basis of 
 experience or changes in circumstances, such modifications or amend- 
 ments to be based upon application by the Supplementary Code Au- 
 thority or other representative group within the Industry to the 
 Administrator and such Notice and Hearing as he shall specify and 
 to become effective and be a part of this Supplementary Code on 
 approval by the Administrator. 
 
 Article X— Price Increases 
 
 Whereas the policy of the Act to increase real purchasing power 
 will be made more difficult of consummation if prices of goods and 
 services increase as rapidly as wages, it is recognized that price in- 
 creases except such as may be required to meet individual costs 
 should be delayed, but when made, such increases should, so far as 
 possible, be limited to actual additional increases in the seller's costs. 
 
 Article XI — Effective Date 
 
 This Supplementary Code shall become effective at 12 : 01 o'clock 
 A.M. Eastern Standard Time of the tenth day after it is approved 
 by the President, and shall continue in effect until June 16, 1935, or 
 the earliest date prior thereto on which the President shall, by 
 proclamation, or the Congress shall, by joint resolution, declare that 
 the emergency recognized by Section 1 of the Act, has ended. 
 
 Approved Code No. 84 — Supplement No. 20. 
 Registry No. 1104-09. 
 
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UNIVERSITY OF FLORIDA 
 
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