Bosch Appliances 1.3.3Production and Material Release, 1.3.4Start-Upand Phase-OutManagement

Bosch Supplier Logistics Manual, Release. 3.0

5.Check the possibility of partial delivery

6.Premium freight capabilities and timing

7.Escalation of the problem inside its company

If no mutually agreed solution can be found, involvement from the highest levels within SUPPLIER’s organization will be required.

Liability of SUPPLIER due to late delivery is regulated by the relevant delivery contract.

1.3.3Production and Material Release

SUPPLIER is obliged to deliver ordered products and required associated materials to the receiving BOSCH plant.

Production releases are legally binding purchase orders of finished goods. However, regarding delivery dates the last updated delivery call-off/ scheduled release is decisive.

Material releases are the basis for BOSCH’s obligation to reimburse respective materials purchased by SUPPLIER, if any. Production and material releases relate to dates of receipt by BOSCH.

Periods for production and material releases are defined in general in the relevant supply contract. If the agreed releases are verifiably inadequate to maintain delivery capability, SUPPLIER can apply for an extension for material release or request additional forecast data from his BOSCH contact in individual cases. Requirements beyond those periods represent non-binding forecasts, based on which SUPPLIER plans its production capacity and sample production.

If BOSCH cancels delivery call-offs/ scheduled releases of finished goods within production release period without having placed corresponding future orders, BOSCH decides if receipt of the finished goods within a reasonable time is accepted or whether agreed upon price is paid.

If BOSCH cancels delivery call-offs/ scheduled releases of finished goods within material release period, BOSCH shall reimburse the cost which SUPPLIER incurred for such material, provided however that SUPPLIER demonstrates that the respective material could not be otherwise used within reasonable time. BOSCH reserves the right to request the shipment of the cancelled raw material.

1.3.4Start-Up and Phase-Out Management

During start-up and phase-out BOSCH expects increased flexibility from its suppliers. This requires a capacity planning process in order to be able to supply even small volumes timely in the right quantities.

Capacity planning must be coordinated between BOSCH and SUPPLIER in time.

1.3.5Order Processing Using the VMI Process

The processes and agreements described in sections 1.3.1 to 1.3.4 are to be applied analogously with VMI (DCM). Deviations are pointed out in the following.

Robert Bosch GmbH, CP/LOG, 07.05.2007 Page 11(35)