THE XXXX "[ * * * ]" IN THIS EXHIBIT 10.1 IS USED WHERE CONFIDENTIAL INFORMATION
HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.
Advanced Energy Comprehensive Supplier Agreement (CSA) # 965100
This Agreement dated MAY 18TH, 1998 is by and between Applied Materials,
Inc., ("Applied"), a Delaware corporation, having its place of business in Santa
Clara, California and Austin, Texas and ADVANCED ENERGY INDUSTRIES, INC., having
its place of business in FT. XXXXXXX, COLORADO.
The parties agree as follows:
1. SCOPE
1.2 INTENTION / DESCRIPTION OF COMPREHENSIVE SUPPLIER AGREEMENT PRINCIPLES
This Comprehensive Supplier Agreement ("CSA") serves as a tool to
manage the parts Applied purchases from Advanced Energy as well as
sub-assemblies Advanced Energy processes for Applied. Attachment 1
lists the part numbers covered by this agreement. Any updates to this
document will INCLUDE a current list of the part numbers covered by this
CSA.
The intention of this document is to guide the relationship between
Applied and Advanced Energy to ensure a consistent supply of material
that meets Applied's specifications and support Applied's Business
Objectives (e.g. HOSHINs). Decisions regarding future purchases from
Advanced Energy will be guided by their performance in this CSA, and
their achievement toward Applied's HOSHIN goals.
1.2 SUPPLIER DETAILS
Advanced Energy
1625 SHARP POINT DRIVE XXXXX XXXXXX, BUSINESS UNIT DIRECTOR
FORT XXXXXXX, COLORADO, 80525 XXXXX XXXXXXX, XXXXXX SITE MANAGER
970-221-4670 MAIN LINE XXX XXXXXXXXXX, VP SALES AND MARKETING
000-000-0000 MAIN FAX XXX XXXXXX, QUALITY ENGINEERING MANAGER
xxx.xxxxxxxx-xxxxxx.xxx. XXXX XXXXXX, VP OF CUSTOMER SATISFACTION
1.3 ENTIRE AGREEMENT
This CSA, including the Standard Terms and Conditions (Exhibit 1), Hoshin Plan
(Exhibit 2) and any other Exhibits or Attachments which are incorporated by
reference into this CSA, together with any non-disclosure agreement sets forth
the entire understanding and agreement of the parties as to the subject matter
of this CSA and supersedes all prior agreements, understandings, negotiations
and discussions between the parties. No amendment to or modification of this
CSA will be binding unless in writing and signed by a duly authorized
representative of both parties. In the event of any conflict between the terms
of the CSA and the terms of the Exhibits and Attachments, the terms of the CSA
shall control.
1.3.1 Attachments and Exhibits
Attachments: Attachments cont.
1. Part Number Listing 10. Corrective Action Form
2. Applied Fiscal Year Calendar 11. Quality Data Form
3. Delivery Mechanics 12. Engineering Change Order
4. Rolling Forecast (ECO) Form
5. Bar Code Specifications 13. Supplier Problem Sheet
6. Packaging Specifications 14. Approved List of Secondary
7. Corporate Transportation Sup-pliers
Routing Guide 15. Supplier Performance Plan
8. Electronic Funds Transfer 16. Supplier World Wide Support
Process (in process) Cen-ter Listings
9. Non disclosure Agreement 17. Cycle Time sheets per part
Exhibits:
1. Standard Terms and Conditions
Advanced____Applied Materials____ 1 of 16
Date______
2. Hoshin Plan
1.4 PART NUMBERS COVERED
In general, all part numbers supplied to Applied by Advanced Energy will
be covered by this agreement. The list of part numbers covered by this
CSA is shown in Attachment 1. New part numbers may be added to
Attachment 1 upon mutual agreement between Applied and Advanced Energy.
Part numbers may be removed from Attachment 1 by Applied from time to
time for legitimate reasons, including, but not limited to:
a. Specification changes the supplier is unable to comply with
b. Quality or delivery default
c. Obsolete parts due to replacement of the part (as opposed to
declining demand)
d. Outsourcing of the parent assembly
1.5 DURATION OF AGREEMENT
The effectivity date of this Service Agreement will be the later of two
signatures dated in Section 9 and will remain in effect through MAY 18TH, 2001
(the "Initial Term"). Upon conclusion or termination of the Initial Term,
Applied, at Applied's option, may extend this Agreement for at least an
additional 6 months subject to all terms and conditions of this Agreement.
1.6 RESPONSIBILITIES
1.6.1 Applied Responsibilities
Applied responsibilities for supporting this agreement include but are not
limited to:
- Providing demand signals to the supplier as defined in section 2.5.1
- Providing updated twenty-six week rolling forecasts to the supplier
- Measuring inventory levels and scoring compliance to days-of-supply
metric
- Receiving and inspecting parts from the supplier and measuring quality
for quality metric
- Notifying the supplier in timely manner of any discrepancies
- Working with the supplier to improve operation of this agreement
- Working with the supplier to reduce costs and improve quality of parts
purchased from the supplier
- Responding in a timely manner to any of the supplier's inquiries
- Working with the supplier to resolve any exceptions that may arise
- Working with the supplier in writing and recording action plans to
resolve exceptions
- Providing the supplier with supplier performance reports
1.6.2 Advanced Energy Responsibilities
Advanced Energy responsibilities for supporting this agreement include but
are not limited to:
- Producing high quality and highly reliable parts
- Delivering parts on time to Applied
- Responding in a timely manner to any of Applied's inquiries and
requests
- Continuously improving the supplier's operations to better serve
Applied's needs and support the Applied's HOSHIN goals
- Working with Applied to improve operation of this agreement
- Working with Applied to reduce costs and improve the quality for all
parts
the supplier produces for the Applied
- Routinely reviewing the updated twelve month forecasts to adjust the
supplier's operation for changes in Applied's plans
- Working with Applied to resolve any exceptions that may arise
- Completing any tasks assigned to resolve exceptions on time
- Meeting with Applied at a minimum of every six (6) months to review
performance
- Tracking and reporting Quality (Internal and External), Reliability and
Delivery Performance
Advanced____Applied Materials____ 2 of 16
Date______
- Monitor and report to Applied, inventory levels of those finished good
parts that Applied might have liability under section 2.2.1.
2. LOGISTICS FRAMEWORK
2.1 OPERATION OF CSA
2.1.1 Operating calendar & holidays
This CSA operates by the Applied fiscal year calendar, shown in
Attachment 2. Recognized holidays are those holidays shown on the
Applied fiscal year calendar. Should any discrepancies between the
operating calendars of Applied and Advanced Energy arise, Advanced
Energy must make provisions so that Applied's operations are
unaffected.
2.1.2 Flowchart of day to day operations
(Reserved)
2.1.3 Forecasts
Advanced Energy's production of parts will be GUIDED by Applied's
most recent 12 WEEK rolling forecast, as provided by Applied to
Advanced Energy on a weekly basis ("Applied's Forecast") via EDI
transaction ID. Advanced Energy will plan, manufacture, and stock
inventory to meet Applied's forecast. Advanced Energy will keep each
of Applied's forecasts for audit purposes for a minimum of six (6)
months and may be asked to present this document for verification of
authorized inventory levels. Applied's forecast is Proprietary
Information to be used only by Advanced Energy to meet its obligations
to Applied under this Agreement.
2.1.4 Releases
Applied may require a part or parts on an accelerated basis, either in
addition to or in place of parts forecast for release or scheduled for
delivery at a later date. If feasible, as determined by Applied and
Advanced Energy, such parts will be provided by Advanced Energy to
meet Applied's requirements. Unless otherwise agreed to by Applied,
such accelerated deliveries will not affect the delivery schedule of
any parts currently allocated for forecast requirements. Lead times
for each accelerated release will be agreed upon by both parties.
2.1.5 Delivery Guidelines
2.1.5.1 General Delivery
Advanced Energy will exercise all efforts to meet Applied's
material requirements on time. Shipments to Applied by Advanced
Energy will be also in the right quantities ordered by Applied.
For Spot Buy purchases for production, deliveries will be
accepted on the requested date or up to 3 days before the
requested date. For Spot Buy purchases for spares, deliveries
will be accepted on the requested date or up to 2 days before
the requested date.
2.1.6 Replenishment Approach
Advanced Energy will be expected to supply parts using one or more of
the following replenishment approaches:
- Bus Route: Point of use delivery where specified.
- Kanban Replenishment Bins/Line Side Stocking
- Spot Buy
Advanced____Applied Materials____ 3 of 16
Date______
The replenishment methodology to be used for a particular parts are
defined on Attachment 1. Specific delivery mechanics are outlined
on Attachment 3.
2.1.7 Electronic Commerce
Advanced Energy is required to communicate with Applied using EDI
ANSI X.12 standards and encouraged to use either XXXX or EDICT
software.
2.1.8 Changes to Logistics
Applied may on occasion change any aspect of any logistics
requirement. Applied will expect Advanced Energy to accommodate
these changes to the best of its ability. Advanced Energy will be
given at least three weeks notification prior to the change being
implemented. Applied will then consider all claims for adjustment in
the logistics framework if made within the three week notification
period in accordance with the AMAT standard terms and conditions.
Logistics refers to delivery, transportation and EDI requirements.
2.2 SERVICE LEVELS
2.2.1 Inventory Levels
Advanced Energy, if involved in supporting lean manufacturing, is
expected to hold inventory of the parts on Attachment 1 in order to
manage demand fluctuations. Advanced Energy will maintain a
minimum of [ * * * ] weeks and a maximum of [ * * * ] weeks of each
part for Applied's needs based on the most recent rolling forecast
(see Attachment 4). Advanced Energy may present a claim for
adjustment for payment of inventory manufactured in response to a
valid Applied purchase order, or an authorized demand signal, as
explained in Section 2.5.1. if Applied has not taken delivery of
the inventory within [ * * * ] from date of manufacture. This
claim must be made within thirty (30) days from the end of the
[ * * * ] time-frame. Applied is not responsible for payment to
Advanced Energy for inventory built without a valid Applied
purchase order or an authorized demand signal, as explained in
Section 2.5.1. An inventory goal of 2 weeks is targeted for 1998
and 1 week for 1999, per the HOSHIN plan. The contract will be
officially amended following the procedure set forth in Section 7,
"Amendments and Modifications" of this CSA.
Applied will not hold any financial responsibility for "off-the-shelf"
parts.
2.2.1.1 WIP Tracking
Suppliers are expected to monitor, track, and report their WIP
inventory. In the future, Applied will implement regular
reporting mechanisms which Advanced Energy will be expected to
participate.
2.2.1.2 Excess and Obsolete (E&O) Parts
Applied will not be responsible for excess and obsolete parts
other than the amounts specified in section 2.2.1 above.
Applied encourages Advanced Energy to make it's best effort to
take back excess and obsolete inventory regardless of the
reason for its not being required by Applied.
2.2.2 Response Requirements
Responses to the following types of inquiries are expected within the
time periods in the tables below.
Advanced____Applied Materials____ 4 of 16
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2.2.2.1 Advanced Energy Response Time
------------------------------------------------------------------------------
Inquiry Type Advanced Energy Advanced Energy
Response Time Contact
------------------------------------------------------------------------------
LEAD-TIME [ * * * ] MASTER PLANNER
------------------------------------------------------------------------------
TECHNICAL [ * * * ] MANUFACTURING
ENGINEER
------------------------------------------------------------------------------
QUOTATIONS: NPI [ * * * ] CUSTOMER SERVICE
REPEAT ORDER [ * * * ] REPRESENTATIVE
------------------------------------------------------------------------------
QUALITY [ * * * ] QUALITY ENGINEER
------------------------------------------------------------------------------
PRICE/INVOICE [ * * * ] CUSTOMER SERVICE
REPRESENTATIVE
------------------------------------------------------------------------------
COMPONENT FAILURE & FIELD [ * * * ] QUALITY ENGINEER
SAFETY
------------------------------------------------------------------------------
PRODUCT PROBLEMS [ * * * ] ACCOUNT MANAGER
------------------------------------------------------------------------------
2.2.2.2 Applied Response Time
------------------------------------------------------------------------------
Inquiry Type Applied Response Time Applied Contact
------------------------------------------------------------------------------
LEAD-TIME [ * * * ] SUPPLIER ACCOUNT
TEAM
LEAD/MEMBER
------------------------------------------------------------------------------
TECHNICAL [ * * * ] SUPPLIER ACCOUNT
TEAM
LEAD/MEMBER
------------------------------------------------------------------------------
QUALITY [ * * * ] SUPPLIER ACCOUNT
TEAM
LEAD/MEMBER
------------------------------------------------------------------------------
PRICE/INVOICE [ * * * ] SUPPLIER ACCOUNT
TEAM
LEAD/MEMBER
------------------------------------------------------------------------------
2.2.3 Flexibility Requirements
Advanced Energy is expected to perform regular capacity planning
and to demonstrate upside/downside flexibility in case of volume
changes at Applied. For Bus Route parts, Advanced Energy will
support unplanned sustained increases/decreases in demand
above/below the forecast as defined below. For Spot Buy parts,
Advanced Energy allows the following increases/decreases to
Purchase Order quantities above/below the quantities originally
requested:
----------------------------------------------------------------------------------------
WEEKS UNTIL
DELIVERY DATE < 1 WEEK < 4 WEEKS < 8 WEEKS < 12 WEEKS 12+ WEEKS
----------------------------------------------------------------------------------------
FLEXIBILITY (BUSROUTE) +/- [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
----------------------------------------------------------------------------------------
FLEXIBILITY (SPOT BUY) +/- [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
----------------------------------------------------------------------------------------
2.2.4 On-site support requirements
As determined by Applied, Advanced Energy may be asked to provide
logistics, quality engineering, and new product development support
on-site at Applied's facilities. At the appropriate juncture,
Applied will require Advanced Energy to complete the On-site
Representative Agreement and processing PRIOR to issuing a building
badge to Advanced Energy's representatives.
Advanced____Applied Materials____ 5 of 16
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2.2.5 Global Support
For the parts listed in Attachment 1, and all other parts that
Advanced Energy provides to Applied, Advanced Energy will provide
support globally for Applied and Applied's customers. Advanced Energy
support centers contact names and phone numbers are listed in
Attachment 16. Repair rates will be outlined in Attachment 1.
Technical assistance and product support services shall be provided
at no additional charge during normal business hours. Advanced
Energy must have an established and deployed global service
capability. The required support services must be available
globally, however, the Supplier may utilize a Supplier distributor,
or other qualified entity designated by Supplier to meet this
requirement. Advanced Energy is expected to use best efforts to
provide a resolution to requests for assistance within the elapsed
time objectives described in 2.2.2.
2.2.6 Turn-around time for Repairs
Advanced Energy will supply Applied with repair parts within,
[ * * * ] days for parts in warranty and [ * * * ] days for parts
out warranty, of Applied's request. [ * * * ] will have a [ * * * ]
day repair part turn around time for parts in and out of warranty.
2.3 INFORMATION
2.3.1 Applied Planning Systems
Advanced Energy may be given electronic access to Applied's planning
data. This access can be used to facilitate production and delivery
of parts to support Applied's requirements.
2.3.3 Applied New Product Plans
Advanced Energy will, on occasion and at Applied's discretion, be
invited to forums in which Applied's new product plans are shared.
2.4 PACKAGING AND TRANSPORTATION
2.4.1 Packaging and Shipment
Advanced Energy will have all parts packaged "fit for use" in
accordance with Applied's packaging specification (Attachment 6).
Advanced Energy will xxxx and identify every item in compliance with
Applied's part identification specifications and requirements
(reference Attachment 6).
THE WORD "FIT" WAS USED TO REPLACE THE WORK "READY", SINCE "READY"
WAS NOT REFERENCED IN ATTACHMENT 6; REFERENCE PAGE 3-4 OF 0250-00098,
REV. K, PACKAGING SPECIFICATION.
2.4.2 Bar Coding
All shipments should be bar coded to Applied's specifications
(Attachment 5).
2.4.3 Transportation Mode
Parts will be transported, FOB Destination, Freight Collect in
accordance with Attachment A of Applied's Corporate Transportation
Routing Guide which is provided in Attachment 7.
Advanced____Applied Materials____ 6 of 16
Date______
2.5 PAYMENT
2.5.1 Demand Signal
BUS ROUTE
Applied sends via EDI transmission an order sheet to Advanced Energy
containing Applied's material requirements information. This
information is organized at the part-number level and represents
Applied's daily purchase from Advanced Energy. This EDI
transmission constitutes an authorized demand signal.
SPOT BUY
As needed, Applied sends via fax an order sheet to Advanced Energy
containing Applied's material requirements information. This
information is organized at the part-number level and represents an
Applied purchase from Advanced Energy. This fax constitutes an
authorized demand signal.
2.5.2 Invoices
Invoices shall contain the following information: purchase order
number, line item number, Applied part number, description of
goods, sizes, quantities, unit prices, and extended totals in
addition to any other information requested. Applied's payment of
invoice does not represent unconditional acceptance of items and
will be subject to adjustment for errors, shortages, or defects.
Applied may at any time set off any amount owed by Applied to
Advanced Energy against any amount owed by Advanced Energy or any
of its affiliated companies to Applied.
All invoices must be sent directly to Accounts Payable in Austin:
Accounts Payable
Applied Materials
0000 XX Xxxxxxx 000 Xxxx X/X 0000
Xxxxxx, XX 00000-0000
2.5.3 Cash Discounts
Payment will be made [ * * * ] days from receipt of:
a. invoice, in form and substance acceptable to Applied, or
b. delivery and acceptance of the invoiced Item(s), whichever
is later.
2.6 DISASTER RECOVERY PLAN
Advanced Energy is expected to provide evidence of a disaster recovery
plan that includes emergency back up capacity and appropriate record
protection and recovery. Furthermore, Advanced Energy represents that
its information systems are year 2000 compatible and hereby grants
Applied the right to verify Advanced Energy's internal processes for
ensuring compliance with this provision.
Applied believes it is critical for suppliers to be prepared and
protected in case of disasters or interruptions to normal business
operations.
Advanced____Applied Materials____ 7 of 16
Date______
2.7 MANAGING EXCEPTIONS TO COMPREHENSIVE SUPPLIER AGREEMENT (CSA)
2.7.1 Identifying constraints
Suppliers are responsible for identifying constraints to meeting CSA
objectives, informing Applied when those constraints occur, and
initiating action plans to resolve them. Constraints might typically
include:
a. Consumption over forecast
b. Consumption under forecast
c. Quality problems
d. Capacity/production problems
e. Supply Chain Management problems
f. Other business issues
2.7.2 Process for Exceptions
Applied will work with suppliers to determine the impact of an
exception and approve and execute the action plans. Advanced Energy
will notify the Supplier Account Team Lead as soon as exceptions are
identified.
3. QUALITY FRAMEWORK
3.1 SUPPLIER NON-CONFORMANCES AND CORRECTIVE ACTION
Advanced Energy's quality must meet all applicable Applied
specifications. Advanced Energy is required to replace or repair
defective parts at supplier's expense in a timely manner. Suppliers are
required to use the most expeditious manner possible to affect the
corrections including the use of overnight delivery services for
shipment of parts; at Applied's request, in certain circumstances,
suppliers may be asked to provide new parts in lieu of repairing a part
to ensure immediate corrective action.
Advanced Energy will be notified of defects with a corrective action
form, Attachment 10, to which they are expected to respond
appropriately. A corrective action process to resolve non-conformances
will be documented and used. In addition, Advanced Energy will
participate in continuous improvement plans and programs as defined by
Applied and Advanced Energy.
[ * * * ]
3.2 APPLIED NON-CONFORMANCES AND CORRECTIVE ACTION
Applied will return parts at Applied's expense that do not conform to
Applied's requirements due to Applied errors. These parts will be
returned for potential rework. Applied and Advanced Energy will agree
in advance on "standard" repair costs (labor, parts and freight) on
items not covered under warranty (Attachment 1).
To the extent that a "standard" repair cost has not been established,
Advanced Energy will assess rework costs and timing and inform Applied
before work is performed. The parties agree that under no circumstances
will the total price charged for repairing a part exceed 50% of the
current purchase price stated in Attachment 1.
Advanced____Applied Materials____ 8 of 16
Date______
Advanced Energy agrees to repair and return all parts within five (5)
business days from receipt of damaged part. Applied shall have the
right to designate certain parts for "Same Day" or "24 Hour" repair
turnaround. Any premium charges for "Same Day" or "24 Hour" repair
turnaround will not exceed [ * * * ] per part.
Prior to return of repaired parts to Applied, Advanced Energy will xxxx
parts with Applied's part number, serial number, gas and range the part
has been exposed to if applicable. Applied shall bear the risk of loss
or damage during transit of Products whether or not the Product meets
warranty requirements.
In addition, a corrective action process to resolve non-conformances
will be documented and used.
3.3 QUALITY ASSURANCE
All goods purchased under this CSA will be subject to inspection and
test by Applied at the appropriate time and place, including the period
of manufacture and anytime prior to final acceptance. If inspection or
test is made by Applied on Advanced Energy's premises, Advanced Energy
will provide all reasonable facilities and assistance for the safety and
convenience of Applied's inspectors at no charge to Applied. No
preliminary inspection or test shall constitute acceptance. Records of
all inspection work shall be kept complete and available to Applied
during the performance of this order and for such further period as
Applied may determine.
Certificate of Conformance (COC): Seller agrees to certify that Items
have passed all production acceptance tests and configuration
requirements and provide a "Certificate of Conformance" and a
Calibration Data Report that will be included with each product during
shipment.
With regard to repair services, Advanced Energy shall maintain
documentation evidencing that all test inspections have been performed.
The documentation shall indicate the nature and number of observations
made, the quantities approved and rejected as well as the nature of the
corrective action taken. Advanced Energy's service centers shall be
responsible for submitting this data for Applied's review of the
delivery summaries. The data shall be submitted monthly not later than
five days after the close of each of Applied's fiscal months to
Applied's Contract Specialist and Applied's IBSS Repairs Purchasing
Group.
At Applied's request, Advanced Energy will provide a certificate and/or
a copy of the final inspection records showing compliance to applicable
specifications, contract requirements and any other required documents
stipulated in Applied's repair authorization. Advanced Energy also
agrees to provide Applied with copies of its current procedures relative
to repairs, range change and warranty repairs.
Advanced Energy will track and maintain reject rate by percentage of
assemblies, and/or part per million reject internally (through Advanced
Energy Quality Service Organization). Trend reporting and corrective
actions shall be furnished to Applied as requested by the Applied
Purchasing or Quality representatives. Advanced Energy will provide
quality data in the format, as shown in Attachment 11, and at the timing
required by Applied. Suppliers may also be required to provide
reasonable additional data to support qualification and certification
programs.
3.4 WARRANTY
Advanced Energy warrants that all goods and services delivered to
Applied will be free from defects in workmanship, material, and
manufacture; will comply with the requirements of this agreement, and,
where design is Advanced Energy's responsibility, will be free from
defects in design. ADVANCED ENERGY FURTHER WARRANTS ALL GOODS PURCHASED
OR REPAIRED WILL BE OF MERCHANTABLE QUALITY AND WILL BE FIT AND SUITABLE
FOR THE PURPOSE INTENDED BY APPLIED. These warranties are in addition to
all other warranties, whether expressed or implied, and will survive any
delivery, inspection, acceptance, or payment by Applied. If any goods
or services delivered by Advanced Energy do not meet the warranties
specified herein or otherwise applicable, Applied may, at its option :
(i) require Advanced Energy to correct at no cost to Applied
any defective or nonconforming goods or services by repair
or replacement, or
Advanced____Applied Materials____ 9 of 16
Date______
(ii) return such defective or nonconforming goods at Advanced
Energy's expense to Advanced Energy and recover from
Advanced Energy the order price thereof, or
(iii) correct the defective or nonconformant goods or services
itself and charge Advanced Energy with the cost of such
correction. Maximum cost will not exceed [ * * * ] of
current purchase price in Attachment 1. Such units will
subsequently be maintained by Applied Materials.
(iv) There will be a [ * * * ] Re-test and Evaluate fee for
IBSS ONLY upon request.
(v) Advanced Energy will comply with IBSS tie wrap requirements
while maintaining Applied Materials logo on the tie wrap.
All warranties will run to Applied and to its customers. Applied's
approval of Advanced Energy's material or design will not relieve
Advanced Energy of the warranties established in this agreement. In
addition, if Applied waives any drawing or specification requirement for
one or more of the goods, it will not constitute a waiver of all
requirements for the remaining goods to be delivered unless stated by
Applied in writing. Warranty length for all parts is listed in
Attachment 1. The warranty on repaired Items will be [ * * * ] from
customer receipt of repaired Item or remainder of initial warranty
period, which ever is longer. For non-warranty repaired Items, the
repaired Item will be warranted from the date of customer receipt of the
repaired Item, for [ * * * ] for parts and labor or [ * * * ] for parts
only.
3.5 OTHER QUALITY PROGRAMS
(Reserved)
3.6 SAFETY
(Reserved)
4. PRICING FRAMEWORK
4.1 PRICING BY PART NUMBER COVERED IN THIS AGREEMENT
The pricing for the parts are shown in Attachment 1. Any modifications
to these must be made in accordance with Section 7. The total cost of
parts supplied by Advanced Energy should be reduced regularly, not just
the unit price. Advanced Energy commits to on-going cost improvement
during the period of this agreement.
At the time of the contract acceptance in Section 9, all open PO's are
to be revised to the contract price.
Specific circumstances may result in re-negotiation of contract terms,
including prices. These include, but are not limited to:
a. Volume increases resulting in an increase in contract value of over
[ * * * ]
b. Addition of part numbers to the contract increasing it in value
over [ * * * ]
c. Cost savings over and above those committed in the performance plan
4.2 COOPERATIVE PRICING MODELS/FORMULAS
(Reserved)
4.3 VOLUME
Advanced Energy will be provided a range of potential volumes that may
be purchased. Applied does not commit to buy a specific volume of a
part number from a supplier. Applied does not limit its ability to buy
the same part number from multiple sources.
4.4 EXPORT PRICING
Advanced____Applied Materials____ 10 of 16
Date______
Advanced Energy should quote Applied in unit prices based upon delivery
FCA Free carrier. Advanced Energy is expected to prepare the export
paperwork and be the exporter of record. Advanced Energy must utilize
Applied's preferred carriers to arrange the export of the goods.
Applied will pay the freight charges based on Applied's rates with its
preferred carriers. Applied will be responsible for importing the goods
into the destination country.
4.5 CURRENCY
All prices are quoted in US dollars; prices for foreign manufactured
parts will not be adjusted to reflect changes in the exchange rate.
Advanced Energy is encouraged to obtain any necessary currency exchange
protection it deems appropriate.
4.6 PROTOTYPES
Advanced Energy is committed to price all parts consistent with contract
prices.
Advanced Energy agrees to provide prototype parts priced considering the
total value of Applied's business with the supplier. This may be
accomplished in several ways, including:
a. a specific number of prototype parts may be provided free of charge
b. parts may be priced at production levels
4.7 ADVANCES FOR RAW MATERIAL
Applied does not provide advance payment for the purchase of raw
material.
4.8 COST REDUCTION / VALUE ANALYSIS
Buyer and Seller will initiate and continue for the term of this
Agreement, value analysis, value engineering, and cost reduction efforts
for all Item(s) in accordance with the Supplier Performance Plan
(Attachment 15 and Section 6). Upon agreement on the incorporation of
changes resulting from these activities, Buyer will amend Attachment 1.
Seller will provide a 3 year plan indicating alignment with HOSHIN cost
reduction goals.
5. TECHNICAL FRAMEWORK
5.1 ENGINEERING CHANGE ORDERS
Applied may change its drawings, design, and specifications at any time.
The Applied Supplier Engineer will review with Advanced Energy all
proposed Engineering Change Orders (ECO's) that impact the form, fit, or
function of supplied material. Applied will, in writing, provide
approved ECO's (refer to Attachment 12) and state the effectivity dates
of all changes. Unless otherwise notified, Applied Receiving Inspection
will inspect to the latest revision in effect at the time of receipt.
Advanced Energy may request engineering changes via a Supplier Problem
Sheet (refer to Attachment 13). This form should be submitted to the
Applied Supplier Engineer. Changes will not be implemented by Advanced
Energy until written permission to proceed is given by Applied. Applied
will consider claims for adjustment in the terms of this Agreement if
made before the implementation of the changes.
5.2 TOOLING
Unless otherwise agreed to in writing, special dies, tools, patterns and
drawings used in the manufacture of parts shall be furnished by and at
the expense of, Advanced Energy.
Advanced Energy ______ Appled Materials _______ 11 of 16
Date ________
5.3 DESIGN CHANGES AND RESOLUTION
For the term of this Agreement, Advanced Energy will not make changes to
the design of any critical part that may alter form, fit, function or
manufacturing process without a documented engineering change request
and prior written approval from Applied.
If Applied's design changes impact the pricing, delivery, lead-time, or
other terms and conditions of this Agreement, and agreement upon
alternate terms cannot be reached, then Applied may remove the subject
part(s) from this Agreement without affecting the remaining part(s).
5.4 PROCESS CHANGES AND RESOLUTION
Advanced Energy is expected to inform Applied of process and supplier
changes to any critical parts even when specifications are met.
Advanced Energy must receive approval in writing from Applied before
implementing changes. If no approval is forthcoming from Applied within
5 working days of notification, approval is granted. Suppliers must use
the "approved" list of secondary process suppliers (Attachment 14).
5.5 SUBCONTRACTING
Advanced Energy shall not subcontract for completed or substantially
completed parts supplied to Applied without prior written approval of
Applied. If no approval is forthcoming from Applied within 5 working
days of notification, approval is granted. All subcontractors to
Advanced Energy that have access (directly or indirectly) to Applied
specifications must be covered by an Applied Non-Disclosure agreement.
5.6 FIRST ARTICLES
A new part, part with revised drawings, or other changes as delineated
above, must have a first article evaluated and accepted by Applied (a
"First Article"). A part will not be authorized for deliveries until
acceptance of the First Article by Applied. Advanced Energy will
maintain First Article qualifications/evidence data file with content as
defined by Applied for the specific part. First Article data is to be
made available to Applied upon request and shall be retained by Advanced
Energy during the performance of this Agreement or subsequent agreements.
5.7 OUTSOURCING
Applied may at its discretion elect to outsource an assembly or module
to a third party ("Subassembler") and if the selected assembly or module
includes any part under this CSA (an "affected part"), Applied will use
reasonable efforts to provide Advanced Energy with the opportunity to
bid on the affected part as a supplier to the Subassembler. Although
Applied may, at its discretion and under no obligation to Advanced
Energy, direct a Subassembler to purchase any affected parts from
Advanced Energy, Advanced Energy understands that the selection and
responsibility for sourcing any affected parts will generally be the
responsibility of the Subassembler. If Advanced Energy is not selected
as the source for an affected part, any affected parts or applicable
quantities of affected parts may, at Applied's discretion, be removed
from this Agreement.
Advanced Energy ______ Appled Materials _______ 12 of 16
Date ________
5.8 PRODUCT SUPPORT
Advanced Energy agrees to provide parts, and technical and service
support to Applied for all of the parts for a minimum of TEN years from
the date of final shipment of a part to Applied. Alternatively, the
parties may agree to establish a product support period less than ten
years provided that Advanced Energy agrees to grant to Applied a
non-exclusive license to make, have made, use, sell, and support the
parts.
5.9 COMMODITY SPECIFIC ISSUES
(Reserved)
5.10 TECHNOLOGY ROADMAP
(Reserved)
6. PERFORMANCE MANAGEMENT
6.1 SUPPLIER PERFORMANCE PLAN
As part of this Comprehensive Supplier Agreement, Applied and Advanced
Energy agree to jointly develop a supplier performance plan. Attachment
15 outlines the performance plan.
6.2 SUPPLIER PERFORMANCE MANAGEMENT
6.2.1 Metrics and Targets
Advanced Energy agrees to perform to the following operational
performance measures: quality, delivery, cost, manufacturing disruption
occurrences, cycle time, and flexibility. Performance targets for
FY2000 are listed. Intermediate performance targets are established in
the Supplier Performance Management Plan. The following defines how
Applied and Advanced Energy will measure performance metrics:
--------------------------------------------------------------------------------------------------------------
MEASURE DEFINITION CALCULATION 1998 TARGET 1999 TARGET 2000 TARGET
--------------------------------------------------------------------------------------------------------------
Quality ppm* Number of quality Number of DMR 1750 ppm 750 ppm 400 ppm
discrepancies detected occurrences recorded
prior to shipping a for all parts provided
completed system to an by the supplier
end customer, accumulated over the
expressed as parts per prior 13-week period,
million divided by the total
receipts for that part
over the same period
and multiplied by 1
million
--------------------------------------------------------------------------------------------------------------
Field Failures Number of part quality Number of RMA 0 0 0
discrepancies detected occurrences recorded occurrences occurrences occurrences
in the field during for each part
installation or accumulated over the
routine repair prior 13-week period
--------------------------------------------------------------------------------------------------------------
Late Delivery ppm* Number of parts Number of parts 20,000 ppm 10,000 ppm 5000 ppm
delivered later than received one day or with 0 ppm with 0 ppm with 0 ppm
the agreed upon more after the LESS THAN LESS THAN LESS THAN
OR EQUAL TO OR EQUAL TO OR EQUAL TO
4 days late 4 days late 4 days late
--------------------------------------------------------------------------------------------------------------
Advanced Energy ______ Appled Materials _______ 13 of 16
Date ________
--------------------------------------------------------------------------------------------------------------
commit date commit date,
accumulated for
each part over a
rolling 13-week
period, divided by the
total number of parts
received over the same
period and multiplied
by 1 million
--------------------------------------------------------------------------------------------------------------
Early Delivery Number of parts Total number of parts 0 ppm 0 ppm 0 ppm
ppm* received three or more received three or more
days before the commit days before the commit
date date, accumulated over
a rolling 13-week
period, divided by the
total number of parts
received over the same
13-week period,
multiplied by 1
million
--------------------------------------------------------------------------------------------------------------
Percentage Cost Percentage difference Difference between the 10% 10% 10%
Reduction between the average total average unit reduction reduction reduction
unit price paid for cost of all parts
materials in the prior purchased from the
year and the price supplier in the
paid in the current current year and the
year total average unit
cost of all parts
purchased from the
supplier in the prior
year (for parts common
to both periods)
--------------------------------------------------------------------------------------------------------------
Should-Cost Total variance between Difference between the Develop & +/- 5% of +/- 5% of
Deviation the should- cost average unit price for Execute Model should-cost should-cost
established by Applied the part and the +/- 5% of
Materials and the Applied Materials should-cost
average unit price should-cost target
paid by Applied (for critical parts
and parts introduced
through NPI activities
within the past 12
months)
--------------------------------------------------------------------------------------------------------------
Order Fulfillment Consistent performance 2 weeks LESS THAN LESS THAN
Cycle Time to the delivery OR EQUAL TO OR EQUAL TO
Ref. 2.2.3 metrics identified 2 weeks 2 weeks
above
--------------------------------------------------------------------------------------------------------------
Source Cycle Time Total cycle time to Elapsed time, as 60% parts 80% parts 80% parts
source all materials determined through w/4wk LT w/4wk LT w/2wk LT
required to produce an process audits and 20% parts 20% parts 20% parts
order supplier self- w/6-8wk LT w/4-8wk LT w/2-4wk LT
assessments 20% parts
--------------------------------------------------------------------------------------------------------------
Advanced Energy ______ Appled Materials _______ 14 of 16
Date ________
--------------------------------------------------------------------------------------------------------------
w/8-12wk LT
--------------------------------------------------------------------------------------------------------------
Make Cycle Time Total production time Elapsed time, as See Attach See Attach See Attach
Attachment 17 required to fulfill an determined through 17 17 17
order, including process audits and
manufacturing order supplier self-
release and build time assessments
--------------------------------------------------------------------------------------------------------------
Manufacturing Number of times a Number of instances of 0
Disruption quality defect or late part unavailability at occurrences
Occurrence (MDO) delivery results in a line side due to
TBD disruption to the quality defects or
normal flow of Applied late shipments over
Materials the prior 13 week
manufacturing period
operations
--------------------------------------------------------------------------------------------------------------
Supplier Upside Number of weeks Number of weeks from 2 weeks
Flexibility required to the occurrence of (25% volume
See Sect. 2.2.3 consistently meet Applied orders that increase)
delivery requirements exceed forecast volume 4 weeks
(including full order to the return of (50% volume
delivery) under quality and delivery increase)
sustained, performance to the 9 weeks
unanticipated demand levels achieved prior (75% volume
increases of 10%, 20%, to the increase increase)
and 50% of the 13 weeks
thirteen-week rolling (100% volume
forecast increase)
--------------------------------------------------------------------------------------------------------------
7. AMENDMENTS AND MODIFICATIONS
This CSA may be revised by the mutual consent of Applied Materials and
Advanced Energy. Revisions to this CSA must be in writing, signed by both
Applied and Advanced Energy, traced by revision numbers and attached to this
original agreement. A change to one attachment of this agreement will
constitute a revision level change. The master copy of this CSA and any
revisions are to be maintained by Applied.
Updates to Section 2.2, Service levels, and changes may be communicated via
memos sent by mail or e-mail.
8. GLOSSARY (TBD)
Advanced Energy ______ Appled Materials _______ 15 of 16
Date ________
9. ACCEPTANCE
Accepted:
Date: 5-18-98
----------------
/s/ Xxxxxxx X. Xxxxxxxx /s/ Xxxxx Xxxxxx
----------------------------------------- ---------------------------------
Xxxxxxx X. Xxxxxxxx , Supplier Engineer Xxxxx Xxxxxx, ABU Director
Applied Materials, Inc. Advanced Energy Industries, Inc.
Applied Materials OEM-Electrical SMO Applied Materials Business Unit
Advanced Energy ______ Appled Materials _______ 16 of 16
Date ________
EXHIBIT 1
APPLIED MATERIALS TERMS AND CONDITIONS OF PURCHASE
TABLE OF CONTENTS
ARTICLE TOPIC PAGE #
------- ----- ------
1 Acceptance 2
2 Confidential and Proprietary Information 2
3 Intellectual Property 3
4 Patent License 3
5 Press Releases/Public Disclosure not 4
Authorized
6 Favored Customer 4
7 Duty Drawback 4
8 ODC Elimination 5
9 Compliance with Laws 5
10 Equal Employment Opportunity 5
11 Applicable Law 5
12 Notice of Labor Disputes 6
13 Taxes 6
14 Responsibility for Goods 6
15 Insurance 6
16 Change of Control 7
17 Assignments 7
18 Gratuities 7
19 Insolvency 7
20 Waiver 8
21 Disclaimer and Limitation of Liability 8
22 Indemnity by Supplier 8
23 Force Majeure 8
24 Changes 9
25 Termination for Default 9
26 Termination for Convenience 9
Page 1 Advanced Energy ____; Applied _____
Date:_____
1. Acceptance
The terms and conditions stated in these Applied Materials Standard
Terms and Conditions of Purchase become the agreement between the
parties covering the purchase of the goods or services (collectively
referred to as "Items") ordered in the Purchase Agreement/Comprehensive
Supplier Agreement/Basic Supplier Agreement of which these Terms and
Conditions are a part when this Agreement is accepted by acknowledgment
or commencement of performance. This Agreement can be accepted only on
these terms and conditions. Additional or different terms proposed by
Supplier will not be applicable unless accepted in writing by the Buyer.
No change, modification, or revision of this Agreement will be
effective unless in writing and signed by duly authorized representative
of Buyer.
2. Confidential and Proprietary Information
Supplier will observe and is bound by the terms and conditions of any
and all Non-Disclosure Agreements (NDAs. Ref. Attachment 9) executed by
Supplier with or for the benefit of Buyer, whether now or hereafter in
effect. In addition, all schematics, drawings, specifications and
manuals, and all other technical and business information provided to
Supplier by Buyer during the term of, or in connection with the
negotiation, performance or enforcement of this Agreement shall be
deemed included in the definition (subject to any applicable exclusions
therefrom) of "Proprietary Information" for purposes of this Agreement.
Supplier may use Buyer's Proprietary Information only for the purpose of
providing Items, parts or components of Items or services to Buyer.
Supplier will not discuss and further will not use any of Buyer's
Proprietary Information, directly or indirectly, for any other purpose
including, without limitation, (a) developing, designing, manufacturing,
refurbishing, selling or offering for sale parts or components of Items
or parts, or providing services, for or to any party other than Buyer,
and (b) assisting any third party, in any manner, to perform any of the
activities described herein. All Proprietary Information shall (a) be
clearly marked by Supplier as Buyer's property and segregated when not
in use, and (b) be returned to Buyer promptly upon request.
Supplier acknowledges and agrees that Buyer would suffer irreparable
harm for which monetary damages would be an inadequate remedy if
Supplier were to breach its obligations under this provision. Supplier
further acknowledges and agrees that equitable relief, including
injunctive relief, would be appropriate to protect Buyer's rights and
interests if such a breach were to arise, or threatened, or were
asserted.
Supplier will use reasonable efforts to notify Buyer of any third party
requests to engage in any of the activities prohibited by this Article.
3. Intellectual Property
Nothing in this Agreement shall be deemed to grant to Supplier any
license or other right under any of Buyer's intellectual property
(including, without limitation, Buyer's patents, copyrights, trade and
service marks, trade secrets, and Proprietary Information) for
Supplier's own benefit or to provide or offer Items to any party other
than Buyer.
All Items supplied by Supplier and the sale of Items by Supplier and, as
applicable, use thereof by Buyer or its subsequent purchasers or
transferees will be free from liability for or claim by any persons of
royalties, patent rights, copyright, trademark, mechanics' liens or
other encumbrances, and trade secrets or confidential or proprietary
intellectual property rights (collectively "rights" and "encumbrances"),
and Supplier shall defend, indemnify and hold harmless Buyer against all
claims, demands, costs and actions for actual or alleged infringements
of patent, copyright, trademark or trade secret rights or other rights
and encumbrances in the use, sale or re-sale of any Item which are valid
at the time of or after the effective date of this Agreement; except to
the extent that the infringement was unavoidably caused by Supplier's
compliance with
Page 2 Advanced Energy ____; Applied _____
Date:_____
a detailed design furnished and required by Buyer or by Buyer's
non-compliance with Supplier's prior written advice or warning of a
possible and likely infringement.
At the request of Buyer, Supplier will provide to Buyer the most current
and complete specifications and drawings (the "Drawings") for each Item
manufactured or produced for Buyer that is based on Buyer's design or
Drawings showing the complete specifications and design for the Item as
manufactured or produced by Supplier. All Drawings are the sole property
of Buyer.
Upon termination of this Agreement, Supplier will return all Applied
Proprietary Information and documentation to Buyer. Notwithstanding
this requirement, Supplier may request Buyer approval to destroy any
Proprietary Information of Buyer that has become obsolete or outdated
(e.g., financial projections, forecasts, et cetera); provided that
Supplier certifies to Buyer the destruction of such Proprietary
Information.
4. Patent LICENSE (PENDING MODIFICATION, 5/18/98, APPLIED _____, ADVANCED
ENERGY _____)
Supplier, as part consideration for this Agreement and without further
cost to Buyer, hereby grants to Buyer an irrevocable, non-exclusive,
paid-up world-wide right and license to make, have made, use, and sell
any inventions derivative works, improvements, enhancements, or
intellectual property (the "Inventions") made by or for Supplier in the
performance of this Agreement. Supplier shall cause any employee,
consultant, contractor or other persons who provides work for hire to
Supplier to assign to Supplier for licensing as above of any such
inventions. In addition, Buyer shall be entitled to license Buyer's
customers to use such inventions during the operation of Buyer's
products.
5. Press Releases/Public Disclosure Not Authorized
Supplier will not, without the prior written approval of Buyer, issue
any press releases, advertising, publicity, public statements or in any
way engage in any other form of public disclosure that indicates the
terms of this Agreement, Buyer's relationship with Supplier or implies
any endorsement by Buyer of Supplier or Supplier's products or services.
Supplier further agrees not to use, without the prior written consent
of Buyer, the name or trademarks (including, but not limited to Buyer's
corporate symbol). Any requests under this Section must be made in
writing and submitted to the parties designated by Buyer for the review
and authorization of such matters.
6. Favored Customer
Supplier does not presently sell or offer any Item that is similar in
form, fit or function to any Item to any third party for prices and
terms and conditions of sale (including, without limitation, warranties,
services or other benefits) (collectively, "Benefits") that are more
favorable than the equivalent prices and Benefits granted by Supplier to
Buyer in this Agreement If during the term of this Agreement, Supplier
enters into any arrangement with any third party providing more
favorable prices or Benefits for any Item than those available to Buyer
under this Agreement (a "Third Party Arrangement"), Supplier will notify
Buyer immediately of that price or Benefits for any Item than those
available to Buyer under this Agreement (a "Third Party Arrangement"),
Supplier will notify Buyer immediately of that price or Benefit and this
Agreement will be deemed amended to provide the same price or Benefit to
Buyer without any further action. However, Buyer, at its option, may
formally amend this Agreement to reflect such changes. If any deemed
amendment results in lowering the price to be paid by Buyer for any
Item, Supplier will refund or credit to Buyer the aggregate amount of
the price difference (including any taxes, fees and similar charges)
that Buyer has paid or been charged from the effective date of the Third
Party Arrangement. Such refund or credit shall be made within thirty
(30) days of the effective date of the Third Party Arrangement. In no
event shall Supplier quote prices to Buyer that would be unlawfully
discriminatory under any applicable law.
7. Duty Drawback
Page 3 Advanced Energy ____; Applied _____
Date:_____
Supplier will provide Buyer with U.S. Customs entry data, including
information and receipts for duties paid directly or indirectly on all
Items that are either imported or contain imported parts or components,
that Buyer determines is necessary for Buyer to qualify for duty
drawback ("Duty Drawback Information"). This data will be provided to
Buyer within fifteen (15) days after each calendar quarter
[or fiscal year quarter of Buyer] and be accompanied by a completed
Certificate of Delivery of Imported Merchandise or Certificate of
Manufacture and Delivery of Imported Merchandise (Customs Form 331) as
promulgated pursuant to 19 CFR 191.
8. ODC Elimination
In the event Supplier's goods are manufactured with or contain Class I
ODCs as defined under Section 602 of the Federal Clean Air Act (42 USC
Section 7671a) and implementing regulations, or if Supplier suspects
that such a condition exists, Supplier shall notify Buyer prior to
performing any work against this Agreement. Buyer reserves the right
to: (a) terminate all Agreements for such goods without penalties, (b)
to return any and all goods delivered which are found to contain or have
been manufactured with Class I ODCs, or (c) to terminate any outstanding
Agreements for such goods without penalties. Supplier shall reimburse
Buyer all monies paid to Supplier and all additional costs incurred by
Buyer in purchasing and returning such goods.
9. Compliance With Laws
Supplier warrants that no law, rule, or ordinance of the United States,
a state, any other governmental agency, or that of any country has been
violated in supplying the goods or services ordered herein.
10. Equal Employment Opportunity
Supplier represents and warrants that it is in compliance with Executive
Agreement 11246, any amending or supplementing Executive Agreements, and
implementing regulations unless exempted.
11. Applicable Law, Consent to Jurisdiction, Venue
This Agreement shall be governed by, be subject to, and be construed in
accordance with the internal laws of the State of California, excluding
conflicts of law rules. The parties agree that any suit arising out of
this Agreement, for any claim or cause of action, whether in contract,
in tort, statutory, at law or in equity, shall exclusively be brought in
the United States District Court for the Northern District of California
or in the Superior or Municipal Courts of Santa Xxxxx County,
California, or in the United States District Court for the Western
District of Texas, Austin Division, or the Texas State District Courts
of Xxxxxx County, Texas, provided that such court has jurisdiction over
the subject matter of the action. Each party agrees that each of the
named courts shall have personal jurisdiction over it and consents to
such jurisdiction. Supplier further agrees that venue of any suit
arising out of this Agreement is proper and appropriate in any of the
courts identified above; Supplier consents to such venue therein as
Buyer selects and to any transfer of venue that Buyer may seek to any of
such courts, without respect to the initial forum.
With respect to transactions to which the1980 United Nations Convention
of Contracts for the International Sale of Goods would otherwise apply,
the rights and obligations of the parties under the Agreement, including
these terms and conditions, shall not be governed by the provisions of
the 1980 United Nations Convention of Contracts for the International
Sale of Goods; instead, applicable laws of the State of California,
including the Uniform Commercial Code as adopted therein (but exclusive
of such 1980 United Nations Convention) shall govern.
12. Notice of Labor Disputes
Whenever an actual or potential labor dispute, or any government
embargoes, regulatory or tribunal proceedings relating thereto is
delaying or threatens to delay the timely performance of this Agreement,
Supplier will immediately notify Buyer of such dispute and furnish all
relevant details regardless of whether
Page 4 Advanced Energy ____; Applied _____
Date:_____
said dispute arose directly, or indirectly, as a result of an actual or
potential dispute within the Supplier's subtier supply base or its own
operations.
13. Taxes
Unless otherwise specified, the agreed prices include all applicable
federal, state, and local taxes. All such taxes shall be stated
separately on Supplier's invoice.
14. Responsibility for Goods; Risk of Loss
Notwithstanding any prior inspections, Supplier shall bear all risks of
loss, damage, or destruction to the Items called for hereunder until
final acceptance by Buyer at Buyer's facility(s) delivery destination
specified in the Agreement, which risk of loss shall not be altered by
statement of any at F.O.B. point herein. These Supplier responsibilities
remain with respect to any Items rejected by Buyer provided, however,
that in either case, Buyer shall be responsible for any loss occasioned
by the gross negligence of its employees acting within the scope of
their employment. Items are not accepted by reason of any preliminary
inspection or test, at any location.
15. Insurance
A. Supplier shall maintain (i) comprehensive general liability
insurance covering bodily injury, property damage, contractual
liability, products liability and completed operations, (ii)
Worker's Compensation and employer's liability insurance, and (iii)
auto insurance, in such amounts as are necessary to insure against
the risks to Supplier's operations.
B. Minimally, Supplier will obtain and keep in force, insurance of the
types and in the amounts set forth below:
Insurance Minimum Limits of Liability
--------- ---------------------------
Worker's Compensation Statutory
Employer's Liability $1,000,000
Automobile Liability $1,000,000 per occurrence
Comprehensive General Liability $1,000,000 per occurrence
(including Products Liability)
Umbrella/Excess Liability $1,000,000 per occurrence
All policies must be primary and non-contributing, and shall include
Buyer as an additional insured. Supplier also waives all rights of
subrogation. Supplier will also require and verify that each of its
subcontractors carry at least the same insurance coverage and minimum
limits or insurance as Supplier carries under this Agreement. Supplier
shall notify Buyer at least thirty (30) days prior to the cancellation
of or implementation of any material change in the foregoing policy
coverage that would affect the Buyer's interests. Upon request,
Supplier shall furnish to Buyer as evidence of insurance a certificate
of insurance stating that the coverage would not be canceled or
materially altered without thirty (30) days prior notice to the Buyer.
16. Change of Control
Supplier will notify Buyer immediately of any change of control or
change (including any change in person or persons with power to direct
or cause the direction of management or policies of Seller) or any
change (10% or more) in the ownership of Supplier, or of any materially
adverse change in Supplier's financial condition or in the operation of
Supplier's business, including, but not limited to, Supplier's net
worth, assets, production capacity, properties, obligations or
liabilities (fixed or contingent) (collectively, a "change of control").
Notwithstanding any other rights Buyer may have under this Agreement,
upon a change of control, Buyer may, in its discretion, renegotiate or
terminate for convenience this Agreement.
Page 5 Advanced Energy ____; Applied _____
Date:_____
17. Assignments
A. No right or obligation under this Agreement shall be assigned by
Supplier without the prior written consent of Buyer, and any
purported assignment without such consent shall be void.
B. Buyer may assign this Agreement in whole or part at any time if
such assignment is considered necessary by Buyer in connection with
a sale of Buyer's assets, or a transfer of any of its contracts or
obligations under such contracts, or a transfer to a third party of
manufacturing activities previously conducted by Buyer.
18. Gratuities
Supplier warrants that it has not offered or given and will not offer or
give any gratuity to induce this or any other agreement. Upon Buyer's
written request, an officer of Supplier shall certify in writing that
Supplier has complied with and continues to comply with this Section.
Any breach of this warranty shall be a material breach of each and every
agreement and contract between Buyer and Supplier.
19. Insolvency
The insolvency of Supplier, the filing of a voluntary or involuntary
petition for relief by or against Supplier under any bankruptcy,
insolvency or like law, or the making of an assignment for the benefit
of creditors, by Supplier, shall be a material breach hereof and default.
20. Waiver
In the event Buyer fails to insist on performance of any of the terms
and conditions, or fails to exercise any of its rights or privileges
hereunder, such failure shall not constitute a waiver of such terms,
conditions, rights or privileges.
21. Disclaimer and Limitation of Liability
In no event shall Buyer be liable for any special, indirect, incidental,
consequential, or contingent damages (the foregoing being collectively
called "Damages"), whether or not Buyer has been advised of the
possibility of such damages, for any reason. Buyer excludes and
Supplier waives any liability of Buyer for any "Damages", as so defined.
22. Indemnity by Supplier
Supplier shall defend, indemnify and hold harmless Buyer from and
against, and shall solely and exclusively bear and pay, any and all
claims, suits, losses, penalties, damages (whether actual, punitive,
consequential or otherwise) and all liabilities and the associated costs
and expenses (including attorney's feesexpert's fees, and costs of
investigation (all of the foregoing being collectively called
"Indemnified Liabilities"), caused in whole or in part by Supplier's
breach of any term or provision of this Agreement, or in whole or in any
part by any negligent, grossly negligent or intentional acts, errors or
omissions by Supplier, its employees, officers, agents or
representatives in the performance of this Agreement or that are for,
that are in the nature of, or that arise under, strict liability or
products liability with respect to or in connection with the Items. The
indemnity by Supplier in favor of Buyer shall extend to Buyer, its
officers, directors, agents, and representatives and shall include and
is intended to include Indemnified Liabilities which arise from or are
caused by, in whole or in part, the concurrent negligence, including
negligence or gross negligence of Buyer or any person entitled to the
benefit of this indemnity or any other person. The indemnity of
Supplier shall not extend to liabilities and damages that are caused by
the sole negligence of Buyer.
23. Force Majeure
Page 6 Advanced Energy ____; Applied _____
Date:_____
A failure by either party to perform due to causes beyond the control
and without the fault or negligence of the party is deemed excusable
during the period in which the cause of the failure persists. Such
causes may include, but not be limited to, acts of God or the public
enemy, acts of the Government in either sovereign or contractual
capacity, fires, floods, epidemics, strikes, freight embargoes and
unusually severe weather. If the failure to perform is caused by the
default of a subcontractor, and such default arises out of causes beyond
the control of both the Supplier and subcontractor, and without the
fault or negligence of either of them, the Supplier will not be liable
for any excess cost for failure to perform, unless the supplies or
services to be furnished by the subcontractor were obtainable from other
sources in sufficient time to permit the Supplier to meet the required
delivery releases. When Supplier becomes aware of any potential force
majeure condition as described in this Agreement, Supplier shall
immediately notify Buyer of the condition and provide relevant details.
24. Changes
Buyer may at anytime, by a written order and without notice to sureties
or assignees, suspend performance hereunder, increase or decrease the
Agreement quantities, or make changes within the general scope of this
Agreement in any one or more of the following:
(a) applicable drawings, designs, or specification;
(b) method of shipment or packing, and/or;
(c) place and date of delivery;
(d) place and date of inspection or acceptance.
If any such change causes an increase or decrease in the cost of or
time required for performance of the Agreement, an equitable adjustment
shall be made in the Agreement price or delivery schedule, or both, and
the Agreement shall be modified in writing accordingly. No claim by
Supplier for adjustment hereunder shall be valid unless asserted within
thirty (30) days from the date of receipt by Supplier of the
notification of change, provided, however, that such period may be
extended upon the written approval of Buyer. However, nothing in this
clause shall excuse Supplier from proceeding with the Agreement as
changed or amended.
25. Termination for Default
(a) Buyer may, by notice, terminate this Agreement in whole or in part
(i) if Supplier fails to deliver goods or services on agreed
delivery schedules or any installments thereof strictly within the
time specified; (ii) if Supplier fails to replace or correct
defective goods or services; (iii) if Supplier fails to comply
strictly with any provision of, or repudiates this agreement, or
(iv) Supplier defaults under, or any event or condition stated to
be a default occurs under, any provision of the Agreement,
including these Applied Materials Standard Terms and Conditions of
Purchase.
(b) In the event of termination pursuant to this Section:
(i) Supplier shall continue to supply any portion of the Items
contracted for under this Agreement that are not terminated;
(ii) Supplier shall be liable for additional costs, if any, for
the purchase of such similar goods and services to cover such
default;
(iii) At Buyer's request Supplier will transfer title and deliver
to Buyer (1) any completed goods, (2) any partially completed
goods and (3) all unique materials. Prices for partially
completed goods and unique materials so accepted shall be
negotiated. However, such prices shall not exceed the
Agreement price per item.
(c) Buyer's rights and remedies herein or otherwise stated in this
Agreement, any Purchase Order, Comprehensive Supplier Agreement or
Basic Supplier Agreement are in addition to and shall not limit or
preclude resort to any other rights and remedies provided by law or
in equity. Termination under this Agreement shall constitute
"cancellation" under the Uniform Commercial Code.
Page 7 Advanced Energy ____; Applied _____
Date:_____
26. Termination for convenience
(a) Buyer may terminate, for convenience, work under this Agreement in
whole or in part, at any time by written or electronic notice.
Upon any such termination Supplier shall, to the extent and at the
time specified by Buyer, stop all work on this Agreement, place no
further orders hereunder, terminate work outstanding hereunder,
assign to Buyer all Supplier's interests under terminated
sub-contracts and Agreements, settle all claims thereunder after
obtaining Buyer's approval, protect all property in which Buyer has
or may acquire an interest, and transfer title and make delivery to
Buyer of all Items, materials, work in process, or other things
held or acquired by Supplier in connection with the terminated
portion of this Agreement. Supplier shall proceed promptly to
comply with Buyer's directions respecting each of the foregoing
without awaiting settlement or payment of its termination claim.
(b) Within six (6) months from such termination, Supplier may submit to
Buyer its written claim for termination charges, in the form and
with supporting data and detail prescribed by Buyer. Failure to
submit such claim within the prescribed time frame and with such
items shall constitute a waiver of all claims and a release of all
Buyer's liability arising out of such termination.
(c) The parties may agree upon the amount to be paid Supplier for such
termination. If they fail to agree, Buyer shall pay Supplier the
amount due for Items delivered prior to termination and in addition
thereto but without duplication, shall pay the following amounts:
(i) The contract price for all Items completed in accordance with
this Agreement and not previously paid for;
(ii) The actual costs for work in process incurred by Supplier
which are properly allocable or apportionable under Generally
Accepted Accounting Principles (GAAP) to the terminated
portion of this Agreement and a sum constituting a fair and
reasonable profit on such costs. The Supplier agrees to keep
true, complete, and accurate records in compliance with GAAP
for the purpose of determining allocability of Suppliers
costs under this agreement. Such records shall contain
sufficient detail to permit a determination of the accuracy
of the costs; Independent nationally recognized accountants
(the "Auditor") designated by Buyer and reasonably acceptable
to Supplier shall have the right, at Buyer's expense and upon
reasonable notice, to conduct audits of all of the relevant
books and records of Supplier in order to determine the
accuracy and allocability of costs submitted by Supplier to
Buyer under this provision.
(iii) The reasonable costs of Supplier in making settlement
hereunder and in protecting Items to which Buyer has or may
acquire an interest.
(d) Payments made under subparagraphs (c)(i) and (c)(ii) shall not
exceed the aggregate price specified in this Agreement, less
payment otherwise made or to be made. Buyer shall have no
obligation to pay for Items lost, damaged, stolen or destroyed
prior to delivery to Buyer.
(e) The foregoing paragraphs (a) to (d) inclusive, shall be applicable
only to a termination for Buyer's convenience and shall not affect
or impair any right of Buyer to terminate this Agreement for
Supplier's default in the performance hereof.
Page 8 Advanced Energy ____; Applied _____
Date:_____
EXHIBIT 2: HOSHIN PRICING 1998
---------------------------------------------------------------------------------------------------------------
ITEM AMAT DESCRIPTION MODEL CURRENT NEG. 2% ADDITIONAL VAE 98 TOTAL HOSHIN EST. % SVGS
PART STD PRICE TOTALS >> NEGOTIATED PRICE 1998 [* * *]
NUMBER
---------------------------------------------------------------------------------------------------------------
1 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
2 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
3 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
4 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
5 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
6 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
7 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
8 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
9 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
10 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
11 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
12 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
13 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
14 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
15 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
16 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
17 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
18 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
19 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
20 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
21 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
22 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
23 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
24 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
25 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
--------------------------------------------------------
ITEM EAU '98 CURRENT EXT. EXT. STD $$ SAVINGS
STD. 1998 CONTRACT [ * * * ]
1998 [ * * * ]
[* * *]
--------------------------------------------------------
1 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
2 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
3 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
4 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
5 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
6 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
7 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
8 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
9 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
10 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
11 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
12 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
13 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
14 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
15 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
16 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
17 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
18 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
19 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
20 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
21 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
22 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
23 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
24 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
25 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
---------------------------------------------------------------------------------------------------------------
ITEM AMAT DESCRIPTION MODEL CURRENT NEG. 2% ADDITIONAL VAE 98 TOTAL HOSHIN EST. % SVGS
PART STD PRICE TOTALS >> NEGOTIATED PRICE 1998 [* * *]
NUMBER
---------------------------------------------------------------------------------------------------------------
26 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
27 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
28 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
29 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
30 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
31 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
32 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
33 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
34 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
35 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
36 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
37 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
38 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
39 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
--------------------------------------------------------
ITEM EAU '98 CURRENT EXT. EXT. STD $$ SAVINGS
STD. 1998 CONTRACT [ * * * ]
1998 [ * * * ]
[* * *]
--------------------------------------------------------
26 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
27 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
28 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
29 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
30 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
31 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
32 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
33 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
34 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
35 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
36 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
37 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
38 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
39 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
NOTES:
1. 1998 EAUs are from Applied Internal Website dated 4/28/98
2. [ * * * ] are expected to transition to P/N [ * * * ]
EXHIBIT 2: HOSHIN PRICING 1999
--------------------------------------------------------------------------------------
ITEM AMAT DESCRIPTION MODEL 1998 NEG. % VAE 99 TOTAL HOSHIN
PART STD TOTALS >> PRICE 1999
NUMBER PRICE
--------------------------------------------------------------------------------------
1 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
2 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
3 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
4 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
5 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
6 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
7 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
8 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
9 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
10 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
11 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
12 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
13 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
14 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
15 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
16 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
17 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
18 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
19 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
20 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
21 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
22 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
23 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
24 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
25 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
-------------------------------------------------------------------
ITEM EST. % SVGS EAU '99 EXT. STD. 1999 EXT. 1999 $$ SAVINGS
[ * * * ] [ * * * ] CONTRACT [ * * * ]
PRICE
[ * * * ]
-------------------------------------------------------------------
1 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
2 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
3 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
4 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
5 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
6 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
7 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
8 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
9 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
10 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
11 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
12 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
13 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
14 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
15 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
16 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
17 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
18 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
19 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
20 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
21 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
22 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
23 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
24 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
25 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
--------------------------------------------------------------------------------------
ITEM AMAT DESCRIPTION MODEL 1998 NEG. % VAE 99 TOTAL HOSHIN
PART STD TOTALS >> PRICE 1999
NUMBER PRICE
--------------------------------------------------------------------------------------
26 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
27 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
28 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
29 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
30 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
31 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
32 [ * * * ] [ * * * ] [ * * * ]
33 [ * * * ] [ * * * ] [ * * * ]
34 [ * * * ] [ * * * ] [ * * * ]
35 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
36 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
37 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
38 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
39 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
-------------------------------------------------------------------
ITEM EST. % SVGS EAU '99 EXT. STD. 1999 EXT. 1999 $$ SAVINGS
[ * * * ] [ * * * ] CONTRACT [ * * * ]
PRICE
[ * * * ]
-------------------------------------------------------------------
26 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
27 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
28 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
29 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
30 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
31 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
32
33
34
35 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
36 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
37 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
38 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
39 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
NOTES:
1. 1999 EAUs are from original estimates 11/25/97
2. [ * * * ] are expected to become obsolete
3. The [ * * * ] PROJECT will combine P/Ns [ * * * ], into ONE part.
The combined price of [ * * * ] will drop to [ * * * ]
4. EAUs for P/Ns [ * * * ] have been adjusted down by [ * * * ] with
the anticipation of the transition to [ * * * ].
5. EAUs for [ * * * ] P/N is calculated off of [ * * * ] Usage and
represent [ * * * ] of [ * * * ] demand
6. EAUs for PVD are best estimates
EXHIBIT 2: HOSHIN PRICING 2000
------------------------------------------------------------------------------------------------------
ITEM AMAT DESCRIPTION MODEL 1999 NEG. % VAE 99 TOTAL HOSHIN EST. % SVGS
PART STD TOTALS >> PRICE 1999 [ * * * ]
NUMBER PRICE
------------------------------------------------------------------------------------------------------
1 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
2 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
3 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
4 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
5 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
6 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
7 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
8 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
9 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
10 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
11 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
12 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
13 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
14 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
15 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
16 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
17 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
18 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
19 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
20 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
21 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
22 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
23 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
24 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
25 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
26 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
------------------------------------------------------
ITEM EAU '00 EXT. STD. 2000 EXT. 2000 $$ SAVINGS
[ * * * ] CONTRACT [ * * * ]
PRICE
[ * * * ]
------------------------------------------------------
1 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
2 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
3 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
4 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
5 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
6 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
7 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
8 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
9 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
10 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
11 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
12 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
13 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
14 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
15 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
16 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
17 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
18 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
19 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
20 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
21 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
22 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
23 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
24 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
25 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
26 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
------------------------------------------------------------------------------------------------------
ITEM AMAT DESCRIPTION MODEL 1999 NEG. % VAE 99 TOTAL HOSHIN EST. % SVGS
PART STD TOTALS >> PRICE 1999 [ * * * ]
NUMBER PRICE
------------------------------------------------------------------------------------------------------
27 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
28 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
29 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
30 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
31 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
32 [ * * * ] [ * * * ] [ * * * ]
33 [ * * * ] [ * * * ] [ * * * ]
34 [ * * * ] [ * * * ] [ * * * ]
35 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
36 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
37 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
38 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
39 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
------------------------------------------------------
ITEM EAU '00 EXT. STD. 2000 EXT. 2000 $$ SAVINGS
[ * * * ] CONTRACT [ * * * ]
PRICE
[ * * * ]
------------------------------------------------------
27 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
28 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
29 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
30 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
31 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
32
33
34 [ * * * ] [ * * * ] [ * * * ]
35 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
36 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
37 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
38 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
39 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
NOTES:
1. 2000 EAUs are based on an expected [ * * * ] increase on top of 1999
usage
2. [ * * * ] will remain obsolete
3. The [ * * * ] PROJECT will combine P/Ns [ * * * ] into ONE part.
The combined price of [ * * * ] will drop to [ * * * ]
4. EAUs for P/Ns [ * * * ] have been adjusted down by [ * * * ] with
the anticipation of the transition to [* * *]
5. EAUs for [ * * * ] P/N is calculated off of [ * * * ] Usage and
represent [ * * * ] of [ * * * ] demand.
6. EAUs for PVD are best estimates
Attachment 1:
ITEMS/WARRANTY
---------------------------------------------------------------------------------------------------------------
ITEM AMAT PART DESCRIPTION UNIT PRICE 1998 UNIT PRICE 1999 UNIT PRICE 2000 UNIT LEAD TIME WARRANTY
NUMBER MONTHS
---------------------------------------------------------------------------------------------------------------
1 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
2 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
3 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
4 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
5 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
6 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
7 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
8 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
9 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
10 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
11 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
12 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
13 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
14 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
15 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
16 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
17 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
18 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
19 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
20 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
21 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
22 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
23 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
24 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
25 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
26 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
----------------------------------------------------
ITEM MAX LIABILITY EAU '98 EAU '99 EAU '00
[ * * * ]
----------------------------------------------------
1 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
2 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
3 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
4 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
5 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
6 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
7 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
8 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
9 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
10 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
11 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
12 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
13 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
14 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
15 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
16 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
17 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
18 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
19 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
20 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
21 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
22 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
23 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
24 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
25 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
26 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
---------------------------------------------------------------------------------------------------------------
ITEM AMAT PART DESCRIPTION UNIT PRICE 1998 UNIT PRICE 1999 UNIT PRICE 2000 UNIT LEAD TIME WARRANTY
NUMBER MONTHS
---------------------------------------------------------------------------------------------------------------
27 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
28 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
29 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
30 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
31 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
32 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
33 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
34 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
35 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
36 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
37 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
38 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
39 [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ] [ * * * ]
----------------------------------------------------
ITEM MAX LIABILITY EAU '98 EAU '99 EAU '00
[ * * * ]
----------------------------------------------------
27 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
28 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
29 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
30 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
31 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
32 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
33 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
34 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
35 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
36 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
37 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
38 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
39 [ * * * ] [ * * * ] [ * * * ] [ * * * ]
NOTES:
1. EAUs (Estimated Annual Usages) are ESTIMATES ONLY, based on
Applied's Forecast
2. 1998 EAUs are from Applied Internal Website dated 4/28/98
3. 1999 EAUs are from original estimates 11/25/97
4. 2000 EAUs are based on an expected [ * * * ] increase
5. Exhibit 2: HOSHIN PLAN, itemizes reduced pricing by part for VAE
Projects
6. 1999 Pricing is effective 1/1/99
