Foxconn ESS Dec Interlock Partner Management Initiatives

1. Foxconn ESS Dec InterlockPartner Management Initiatives Jeff Mason January 23, 2008 Houston, TX

2. PMI Topics – Foxconn Dec Interlock • Capacity – CZ, Hou, & China – Mason • EOL Update – DL760 & Ruger – Mason Hon Hai Feb 2009 Interlock

3. Foxconn Pardubice, Houston, & China OperationsCapacity Update

4. Capacity Models - General Updates • Feb LCVF data included for BL490c G6 & BL280c G6 • SWD demand not yet included for shared G6 platforms but are expected to launch in June. Hon Hai Feb 2009 Interlock

5. CZ Facility Expansion Plan Update HP FYQ109 • Overspill to box process (3k readiness for outbound) – Complete 1/31 • Factory effective capacity 46k monthly (40k Servers + 4k Blades + 2k C-class) with 2 shifts/20 days per month Blades Expansion • Further expansions scheduled in April and August with a goal of reaching 1k per day by Jan 2010. Possibilities For Next Expansion Current Outbound area (available in Feb 2009) – potential mfg expansion 600m2 (completely separate from the April and August Blade expansions) Excess capacity positioned to enable Foxconn CZ to take on additional volumes/programs. Link to Definitions and Parameters Hon Hai Feb 2009 Interlock

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9. BL280 G6 & BL490 G6 LCVF incorporated. Hon Hai Feb 2009 Interlock

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11. Houston Facility Update • Foxconn RD team moving out of 8802 Fallbrook site. • Move was completed in January. • One hundred additional run-in bays to be installed after RD relocation. (On hold due to declining volumes) • All blade products consolidated into single model. Link to Definitions and Parameters Hon Hai Feb 2009 Interlock

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15. BL280 & BL490 LCVF included Hon Hai Feb 2009 Interlock

16. Foxconn China Infrastructure • Dec was the premier of the Foxconn China infrastructure model – C7000, C3000, and Freighter families of products. • Tanker – need to confirm with Foxconn China that the Freighter model parameters take into account any differences that may be required by Tanker. Pending. Link to Definitions and Parameters Hon Hai Feb 2009 Interlock

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20. EOL Update

21. EOL Update – DL760 and Ruger • DL760 & Ruger packages were frozen in Jan (EOQ) • Once requisitions were unfrozen, had to restart electronic signature process. • Expect PO to be released 2/27. • Foxconn Confirmation Hon Hai Feb 2009 Interlock

22. Need PO Receipt Confirmation • DL380- 3 packages - $491k • Cyborg - $369k • Ruger – $3.5k • DL760 - $24.7k • Foxconn reporting closed: • 293052-B21 Rd HoleRL DL380G3/560 • 371482-B21 Rnd/SqrHole Shpng Kt 350/70/80 Hon Hai Feb 2009 Interlock

23. File • Attached Feb EOL update file • Action – Foxconn confirm PO receipt by March 3 • Jeff to update file and resend to Foxconn • Foxconn to update by March 11. Hon Hai Feb 2009 Interlock

25. Backup

26. BackupCapacity Models

27. Capacity Model – Definitions • “Working Efficiency” – This is the engineering, on paper, or 100% capacity calculation. This is in most all circumstances, not achievable or sustainable. This based on normal operating parameters (eg.7.3 hours per shift x 1 shift per day x 20 days per month). • “Effective Efficiency” –This will be based on the standard operating parameters and will be determined by de-rating the Working Efficiency. The percent of de-rating (accounts for part shortages, labor gaps, line changes, etc.) is based on historical throughput data. • “Burst Effective Efficiency” – As needed, ODM will gain additional capacity by assuming the same de-rating, but will include a move to more hours per shift, shifts per day, or days per month as needed. Hon Hai Feb 2009 Interlock

28. Foxconn Czech Republic Capacity Model • Model was created using ISS February Week 3 DSHIP and SWD NAS/NearLine February demand data. • 12 Month look forward • Based on the product mix transition, capacity resources within the model have been allocated 90/10 between DL/ML respectively. This change was incorporated starting in the Aug model. • Foxconn CZ capacity model is based on achieving 95% of the “Working” or engineering capacity. • CZ Standard or “Effective” Operating Parameters: • 7.3 hours per shift • 2 shifts per day • 20 days per month • CZ “Burst” Operating Parameters: • 7.3 hours per shift • 3 shifts per day • 26 days per month Hon Hai Feb 2009 Interlock

29. Foxconn Houston Capacity Model • Model was created using ISS February Week 3 DSHIP and SWD NAS/NearLine February demand data • 12 Month look forward • One line dedicated to DL38x. • Second line is “DL MultiServer/ML” line. • Foxconn Houston capacity model is based on achieving 80% of the “Working” or engineering capacity. • Single Blades Model • Houston Standard or “Effective” Operating Parameters: • 8.5 hours per shift • 1 shifts per day - 2nd shift added to DL38x and Blade line • 21 days per month • Houston “Burst” Operating Parameters: • 10 hours per shift • 1 shifts per day • 28 days per month Hon Hai Feb 2009 Interlock

30. Foxconn China Infrastructure Capacity Model • Model was created using ISS January Week 2 DSHIP demand data • 12 Month look forward • 3 Lines – C3000, C7000, Freighter • Foxconn China capacity model is based on achieving 87% of the “Working” or engineering capacity. • China Standard or “Effective” Operating Parameters: • 8 hours per shift • 1 shifts per day • 20 days per month • China “Burst” Operating Parameters: • 8 hours per shift • 2 shifts per day • 20 days per month Return to Capacity Presentation Hon Hai Feb 2009 Interlock