1. 1 ProductsQualityLogisticsHistory www.niccomp.comwww.niccomp.com | www.LowESR.comwww.LowESR.com Market Why NIC is preferred Passive Component Update Topics: Market Technology Production Material Issues New & Redesign Recommendations New Products

2. 2 ProductsQualityLogisticsHistory www.niccomp.comwww.niccomp.com | www.LowESR.comwww.LowESR.com Market Why NIC is preferred Sources: Nippon Industries Company Ltd (Japan) NIC Components Corp. (Taiwan) Paumanok Publications, Inc Leading passive component market analysts… & publishers of Passive Component Industry Magazine Bi-monthly look at the passive component market and technology www.paumanokgroup.com/ Reed Electronics Research www.rer.co.uk Electronic Buyer News (EBN) www.ebnonline.com Electronic Component News (ECN) www.ecnmag.com

3. 3 ProductsQualityLogisticsHistory www.niccomp.comwww.niccomp.com | www.LowESR.comwww.LowESR.com Market Why NIC is preferred Changing Technology Impact Passive Devices Technology Innovations Lower voltage of operation = increased circuit current = higher demands on voltage - power management circuitry = tighter line (supply voltage) regulation (reduce ripple voltage) = increased demand for low ESR capacitors Faster circuit speeds = reduced response time for voltage - power management circuits = increased demand on capacitor bank Higher frequency operation = reduced trace distances = better performing & smaller devices All impact signal & supply voltage integrity

4. 4 ProductsQualityLogisticsHistory www.niccomp.comwww.niccomp.com | www.LowESR.comwww.LowESR.com Market Why NIC is preferred Development of Passive Components Passive component research & development: New & Improved Materials + improve characteristics + reduce costs Improved Processing & Equipment + expanded available range + increased production + reduced components sizes

5. 5 ProductsQualityLogisticsHistory www.niccomp.comwww.niccomp.com | www.LowESR.comwww.LowESR.com Market Why NIC is preferred Passive Component Usage by Market

6. 6 ProductsQualityLogisticsHistory www.niccomp.comwww.niccomp.com | www.LowESR.comwww.LowESR.com Market Why NIC is preferred Passive Components Markets Review: ~12% growth in 2002 Passive Component Market ($ value) as compared to 2001 level Price erosion is substantial Limited capacity expansion CAPACITOR MARKET (2002) 615 Billion units = $8.38 billion

7. 7 ProductsQualityLogisticsHistory www.niccomp.comwww.niccomp.com | www.LowESR.comwww.LowESR.com Market Why NIC is preferred MULTILAYER CERAMIC CHIP CAPACITORS : Materials Shift Electrodes (PdAg or BME- Base Metal: Nickel) BME Pd-Ag 2002 Estimates: 70% of global MLCC production is BME Nickel Electrode Powder Shipments 1995 = 95 Tons 2000 = 645 Tons 2005 (E) = 1830 Tons

8. 8 ProductsQualityLogisticsHistory www.niccomp.comwww.niccomp.com | www.LowESR.comwww.LowESR.com Market Why NIC is preferred MULTILAYER CERAMIC CHIP CAPACITORS : Materials Shift Pd-Ag … Price Per Troy Ounce (USD)

9. 9 ProductsQualityLogisticsHistory www.niccomp.comwww.niccomp.com | www.LowESR.comwww.LowESR.com Market Why NIC is preferred MULTILAYER CERAMIC CHIP CAPACITORS : Developments  Nickel electrodes & Copper terminations = reduced component costs – Greater equipment (firing) costs  Increased number of layers [ >100 layers ]  1uF and above = very low ESR [ sub 0.010ohm @ 100KHz)  X7R (-55 ~ +125) & X5R (-55 ~ +85) = ±15% Cap change  Encroaching upon tantalum electrolytic range  100uF / 6.3VDC [1210 in X5R & Y5V TCs]  Thinner (sub–micron) dielectric layers = lower voltage ratings – Voltage-coefficient effects – Aging effects & piezo-electric noise

10. 10 ProductsQualityLogisticsHistory www.niccomp.comwww.niccomp.com | www.LowESR.comwww.LowESR.com Market Why NIC is preferred MULTILAYER CERAMIC CHIP CAPACITORS NMC Series: MLCCs Ceramic Chip Capacitors 0201 size NPO = (101) 100pF / 25VDC X7R = (332) 3300pF/16VDC X5R = (103) 0.01uF/10VDC New! X5R = (104) 0.1uF/4VDC 0402 size NPO = (471) 470pF / 16VDC X7R = (104) 0.10uF/10VDC New! X5R = (105) 1.0uF/10VDC Y5V = (105) 1.0uF/6.3VDC 0603 size NPO = (182) 1800pF / 50VDC New! X7R = (105) 1.0uF/10VDC New! X5R = (225) 2.2uF/6.3VDC Y5V = (225) 2.2uF/10VDC 0805 size NPO = (682) 6800pF /50VDC New! X7R = (475) 4.7uF/10VDC New! X5R = (106) 10uF/6.3VDC Y5V = (106) 10uF/10VDC 1206 size NPO = (103) 0.01uF /50VDC New! X7R = (106) 10uF/6.3VDC X5R = (226) 22uF/10VDC Y5V = (226) 22uF/10VDC 1210 size NPO = (103) 0.01uF / 50VDC X7R = (106) 10uF/16VDC X5R = (476) 47uF/6.3VDC New! X5R = (107) 100uF / 6.3VDC New! Y5V = (107) 100uF / 6.3VDC

11. 11 ProductsQualityLogisticsHistory www.niccomp.comwww.niccomp.com | www.LowESR.comwww.LowESR.com Market Why NIC is preferred MULTILAYER CERAMIC CHIP CAPACITORS MLCC Market: Year 2000 was record year (30% growth to $5.6Billion; source RER) for MLCC industry with demand exceeding supply and prices inching up. During year 2000 crunch many producers added considerable production expansion equipment. Supply should meet all demands through year 2002 & 2003. Pricing has eroded due to over-supply and reduced costs of raw materials ( BME vs. Pd-Ag ). MLCC expansion has been focused on BME ( Base Metal Electrode; nickel ) construction for X7R and Y5V as opposed to Pd-Ag electrode construction. NPO will remain Pd-Ag ( although with reduced Pd loading ) and will likely transition to BME over time.

12. 12 ProductsQualityLogisticsHistory www.niccomp.comwww.niccomp.com | www.LowESR.comwww.LowESR.com Market Why NIC is preferred MULTILAYER CERAMIC CHIP CAPACITORS Case Size20022003 02016KK20KK 0402400KK600KK 0603550KK650KK 0805200KK 120655KK50KK > 120615KK Cap Arrays5KK20KK TOTAL =1230KK1555KK NIC Monthly Capacity by Case Size

13. 13 ProductsQualityLogisticsHistory www.niccomp.comwww.niccomp.com | www.LowESR.comwww.LowESR.com Market Why NIC is preferred MULTILAYER CERAMIC CHIP CAPACITORS NMC Series: 0201 size MLCCs Ultra-Small Ceramic Chip Capacitors [L x W x H = 0.6 x 0.3 x 0.3mm]  NPO + 10V / 16V / 25V / 50V + 0.47 ~ 100pF + P/N: NMC0201NPOxxx  X7R + 16V / 25V / 50V + 39pF ~ 3300pF + NMC0201X7Rxxx Applications: Ultra-Small for Hand Held – Embedded Device Precautions: Solder Paste & Placement Issues  X5R & Y5V + 4 / 6.3 / 10V + 1200pF ~ 0.1uF + NMC0201X5Rxxx

14. 14 ProductsQualityLogisticsHistory www.niccomp.comwww.niccomp.com | www.LowESR.comwww.LowESR.com Market Why NIC is preferred MULTILAYER CERAMIC CHIP CAPACITORS NMC-L / NMC-M Series: Low ESR / High Q NPO Ceramic Chip Capacitors  0402, 0603, 0805  O.5 ~ 150pF  Low ESR / High Q up to 2GHz Ultra-Stable High Frequency NPO Ceramic Chip Capacitors NIC, has added a new range of low ESR multilayer ceramic chip capacitors. Ideally suited to high speed, high frequency applications such as those found in Bluetooth and Wi-Fi (IEEE 802.11b) products. Manufactured using ultra stable, low loss NPO/COG dielectric, the devices are available with values ranging from 0.5pF to 150pF. Both 50V dc and 100V dc rated parts are available. Supplied in tape and reel packaging, the NMC-L range is compatible with both re-flow and flow soldering processes.

15. 15 ProductsQualityLogisticsHistory www.niccomp.comwww.niccomp.com | www.LowESR.comwww.LowESR.com Market Why NIC is preferred  Transition away from larger (>0805) sizes  Use 0603 and 0402 on new and redesigns as much as possible  Smaller sizes have best availability and lowest costs going forward  Be aware and plan for possible future P&D issues with: – Larger (>0805) sizes – Higher voltage parts (>100VDC) – High capacitance ( high Pd content ) NPO MULTILAYER CERAMIC CHIP CAPACITORS : Recommendations

16. 16 ProductsQualityLogisticsHistory www.niccomp.comwww.niccomp.com | www.LowESR.comwww.LowESR.com Market Why NIC is preferred SMT ALUMINUM ELECTROLYTIC CAPACITORS: Market - Technology: SMT aluminum electrolytic types have led ( and will continue to lead ) in high demand. Useful as alternates to chip tantalum in many applications, and at lower cost has fueled growth – acceptance industry wide. No raw material – production issues are expected to impact this product type. Lower unit pricing expected over time as non-Japanese manufactures accelerate production. Focus ( chiefly solid electrolyte types ) in development of lower ESR – Z types for lower voltage – higher current power management applications. Introduction of larger case sizes has allowed higher capacitance values and high voltage rated versions, as replacement for leaded & snap-in types.

17. 17 ProductsQualityLogisticsHistory www.niccomp.comwww.niccomp.com | www.LowESR.comwww.LowESR.com Market Why NIC is preferred NIC Monthly Capacity by Size SMT ALUMINUM ELECTROLYTIC CAPACITORS:

18. 18 ProductsQualityLogisticsHistory www.niccomp.comwww.niccomp.com | www.LowESR.comwww.LowESR.com Market Why NIC is preferred SMT Low ESR ELECTROLYTIC CAPACITOR COMPARISON:

19. 19 ProductsQualityLogisticsHistory www.niccomp.comwww.niccomp.com | www.LowESR.comwww.LowESR.com Market Why NIC is preferred Many E-capacitor suppliers have developed low ESR capacitors… NIC offers the most options – design choices… SMT Low ESR ELECTROLYTIC CAPACITOR COMPARISON:

20. 20 ProductsQualityLogisticsHistory www.niccomp.comwww.niccomp.com | www.LowESR.comwww.LowESR.com Market Why NIC is preferred  Use SMT aluminum electrolytic capacitors: + when low cost is needed (lowest cost per uF of SMT types) + when high voltage (>20VDC) rating (or no de-rating is possible) is required + when >470uF is required (values to 6800uF in SMT Alum V-Chip) + where component must be tolerant of voltage – current transients + where component height can be tolerated + when looking to replace leaded electrolytic capacitors + when high speed placement is needed & reflow soldering SMT ALUMINUM ELECTROLYTIC CAPACITORS: Recommendations  SMT aluminum electrolytic capacitors are available in: + Low ESR – Solid Aluminum (100KHz ESR to 0.005ohm) + High Voltage (up to 450VDC) + 125°C, 105 °C & 85°C Ratings + Low Leakage Current & Bi-Polar Styles

21. 21 ProductsQualityLogisticsHistory www.niccomp.comwww.niccomp.com | www.LowESR.comwww.LowESR.com Market Why NIC is preferred LEADED ALUMINUM ELECTROLYTIC CAPACITORS Market & Technology: Explosive growth in SMT type is replacing portions of radial leaded applications. No raw material – production issues expected to impact this product. Focus is upon development of lower ESR – Z types for lower voltage – higher current power management applications. Elimination or alternate to PVC Sleeving to be phased in. Migration of Japan – Taiwan production to China likely will result in price erosion over time

22. 22 ProductsQualityLogisticsHistory www.niccomp.comwww.niccomp.com | www.LowESR.comwww.LowESR.com Market Why NIC is preferred LEADED ALUMINUM ELECTROLYTIC CAPACITORS MARCH 2003 MARKET UPDATE: + Increasing lead times on Low ESR Radial (8 & 10mm diameters) from Japan + Motherboard producers in effort to isolate themselves from Taiwan E-cap troubles have booked available capacity from most Japanese suppliers + Consumer entertainment equipment showing strong demand; DVDs, set-top boxes, satellite dishes, video games, LCD televisions, flat panel plasma displays and audio systems RECOMMENDATIONS: + Prepare for longer lead times on 6.3mm, 8mm & 10mm diameter with scheduled orders out as long as four months. + Consider building a buffer inventory on certain types and sizes. + Choose quality manufacturers who can document raw material suppliers and provide life test data. + Select suppliers with global logistic capabilities to insure allocation for each region.

23. 23 ProductsQualityLogisticsHistory www.niccomp.comwww.niccomp.com | www.LowESR.comwww.LowESR.com Market Why NIC is preferred LEADED ALUMINUM ELECTROLYTIC CAPACITORS: New Products Ultra-Low ESR Solid Aluminum Electrolytic Capacitors (NSPZR Series) Radial Leaded 100KHz ESR = 0.008ohm 100KHz RCR = 5.500Arms Capacitance Values = 180 ~ 820uF Voltage Ratings = 4 ~ 16VDC Sizes = 8 & 10mm Diameters Lowest ESR of Radial Leaded TypesNSPZR Lower Cost Hybrid Electrolyte Aluminum Electrolytic Capacitors (NSPER Series) Radial Leaded 100KHz ESR = 0.012ohm 100KHz RCR = 2.34Arms Capacitance Values = 330 ~ 1000uF Voltage Ratings = 4 ~ 10VDC Sizes = 8 & 10mm Diameters NSPER

24. 24 ProductsQualityLogisticsHistory www.niccomp.comwww.niccomp.com | www.LowESR.comwww.LowESR.com Market Why NIC is preferred Low ESR Aluminum Electrolytic Capacitors (NRSK Series) Radial Leaded 100KHz ESR = 0.012ohm 100KHz RCR = 3.29Arms Capacitance Values = 470 ~ 3300uF Voltage Ratings = 6.3 ~ 16VDC Sizes = 8 & 10mm DiametersNRSK 4000 Hour Life Aluminum Electrolytic Capacitors (NRSG Series) Radial Leaded 100KHz ESR = 0.016ohm 100KHz RCR = 3.29Arms Capacitance Values = 82 ~ 4700uF Voltage Ratings = 4 ~ 25VDC Sizes = 6.3, 8, 10 & 12.5mm Dia. NRSG LEADED ALUMINUM ELECTROLYTIC CAPACITORS: New Products

25. 25 ProductsQualityLogisticsHistory www.niccomp.comwww.niccomp.com | www.LowESR.comwww.LowESR.com Market Why NIC is preferred also see www.lowESR.comwww.lowESR.com RADIAL LEADED Low ESR ELECTROLYTIC CAPACITOR COMPARISON:

26. 26 ProductsQualityLogisticsHistory www.niccomp.comwww.niccomp.com | www.LowESR.comwww.LowESR.com Market Why NIC is preferred  Use Leaded aluminum electrolytic capacitors:  when lowest cost is needed (lowest cost per uF of all types)  when high voltage (up to 450VDC) rating (or no de-rating is possible) is required  when high capacitance is required (values to 1.2Farad = 1,200,000uF)  where component must be tolerant of voltage – current transients  where component height can be tolerated LEADED ALUMINUM ELECTROLYTIC CAPACITORS: Recommendations  Leaded aluminum electrolytic capacitors are available in:  Low ESR – Solid Aluminum (100KHz ESR to 0.008ohm)  High Voltage (up to 450VDC)  +125°C, +105 °C & +85°C Ratings  Low Leakage Current & Bi-Polar Styles  Radial, Snap-In and Screw Terminals

27. 27 ProductsQualityLogisticsHistory www.niccomp.comwww.niccomp.com | www.LowESR.comwww.LowESR.com Market Why NIC is preferred SMT TANTALUM ELECTROLYTIC CAPACITORS Market : Year 2000 was record year (~50% growth from 1999* *source RER ). High demand, with long lead times and pricing increases. Since late 2000 standard construction ( MnO2 cathode ) capacitors demand has dropped significantly. Industry over-stock and reduced demand has resulted in severe continued price erosion. Raw material supply - chain has been expanded and is projected to be stable for 10+ years. NEW Reduced case sizes low voltage 2.5VDC ~ 16VDC 0603 (J) 0805 (P) MONTHLY CAPACITY

28. 28 ProductsQualityLogisticsHistory www.niccomp.comwww.niccomp.com | www.LowESR.comwww.LowESR.com Market Why NIC is preferred SMT TANTALUM ELECTROLYTIC CAPACITORS Cathode Materials: MnO2 – Standard & reduced ESR PPY - Polypyrrole (Low ESR) Refined tantalum powder suppliers – supply chain were source of year 2000 shortage TANTALUM CAPACITOR PROCESS

29. 29 ProductsQualityLogisticsHistory www.niccomp.comwww.niccomp.com | www.LowESR.comwww.LowESR.com Market Why NIC is preferred LOW ESR POLYMER CATHODE TANTALUM ELECTROLYTIC CAPACITORS Technology: Use of POLYMER in place of MnO2 for CATHODE results in low ESR, high ripple current ratings (RCR) and suppression of combustion (will not support flame) under failure. Applications in high density low voltage – high current power management designs. Larger sizes C & D/V cases continue to be popular. Expansion has covered all sizes P ~ D/V. Newer NTP series parts developed include lower ESR 0.015-ohm products.

30. 30 ProductsQualityLogisticsHistory www.niccomp.comwww.niccomp.com | www.LowESR.comwww.LowESR.com Market Why NIC is preferred Niobium Electrolytic Capacitors Niobium is one of the alternatives being considered to replace tantalum in capacitors. Estimates, niobium is over 100 times more plentiful than tantalum ( less than 1/10 th the cost ). NIC’s NBP series has same construction as conductive polymer cathode tantalum ( NIC NTP Series ). It is anticipated that in the future, niobium capacitors will be used for high-capacity devices ( up to 1000µF ), which are too costly to produce using tantalum. NIC’s niobium capacitor at a glance Specifications: Rated Voltage2.5V Capacitance220uF Size(D) 7.3 x 4.3 x 2.8mm ESR0.055ohms Part NumberNBP series (specifications in development) [Higher material costs (as compared to tantalum types) has suppressed product develop activity on Nb types at most e-cap producers] NEW TECHNOLOGY COMPONENTS: Materials - Product Development 41 Nb 92.90638

31. 31 ProductsQualityLogisticsHistory www.niccomp.comwww.niccomp.com | www.LowESR.comwww.LowESR.com Market Why NIC is preferred  Use SMT tantalum aluminum electrolytic capacitors: + when small size is required + when low profile (low head-row) is needed + where long life at high temperature operation (>+65°C) is needed + where operation voltage is tightly regulated: protected from transients, over-voltage or reverse voltage + when looking to replace leaded electrolytic capacitors + when high speed placement are needed + when flow – wave soldering compatibility is needed SMT TANTALUM ELECTROLYTIC CAPACITORS: Recommendations  Today SMT tantalum electrolytic capacitors are available in: + Low ESR – Polymer Cathode and MnO2 Cathode Types + Reduced 0603 (J) & 0805 (P) case size + Capacitance values to 470uF (2VDC)

32. 32 ProductsQualityLogisticsHistory www.niccomp.comwww.niccomp.com | www.LowESR.comwww.LowESR.com Market Why NIC is preferred FILM CHIP CAPACITORS (SMT)  Raw Materials: (PEN / PPS Films)  Thin metallized films (16 ~ 100VDC)  Stable characteristics over temperature, voltage & time (as compared to X5R/X7R/Y5V/Z5U ceramics)  0805 / 1206 / 1210 / 1913 / 2416 Sizes  High capacitance - tight tolerance (up to 0.47uF in ±2%, ±5%)  Low dielectric absorption (DA) characteristics for A/D conversion applications  Low dissipation factor (DF) for high efficiency display circuits (portable - battery powered designs)  Immunity to cracking = good choice as compared to SMT ceramic capacitors Recommendations: Use SMT film chip capacitors  When need better performance than ceramic types is needed  When (MLCC) component cracking has been issue  When lowest loss (DF) for high circuit efficiency is needed

33. 33 ProductsQualityLogisticsHistory www.niccomp.comwww.niccomp.com | www.LowESR.comwww.LowESR.com Market Why NIC is preferred Technology Roadmap SMT Magnetics Products SMT – Surface Mount  Ferrite Chips Beads: Noise suppression – filtering at high frequency  Standard (low ~ medium current)  0603 ~ 1812 sizes  High Current (5Amp) Lead & Core  1612, 3119 & 3312 sizes

34. 34 ProductsQualityLogisticsHistory www.niccomp.comwww.niccomp.com | www.LowESR.comwww.LowESR.com Market Why NIC is preferred SMT – Surface Mount  Chip Inductors: NIS Series: Surface Sprial (high Q) 0201, 0402 & 0603 sizes NML Series: Multilayer (MLI) Chips 0402 & 0603 sizes NIN-H Series: WireWound Open Frame (high current) 0402, 0603, 0805 & 1008 sizes NIN-F Series: WireWound Molded Case 1008, 1210 & 1812 sizes NPI Series: Power Inductors (High Current Power Supplies) 9.0mm x 12.0mmm size High Frequency Performance! Low Cost! Crosses – Replaces COILCRAFT Power Supplies Older Designs Technology Roadmap SMT Magnetics Products

35. 35 ProductsQualityLogisticsHistory www.niccomp.comwww.niccomp.com | www.LowESR.comwww.LowESR.com Market Why NIC is preferred SMT Magnetics Products Cross-Reference:

36. 36 ProductsQualityLogisticsHistory www.niccomp.comwww.niccomp.com | www.LowESR.comwww.LowESR.com Market Why NIC is preferred SMT RESISTORS & ARRAYS Market & Technology: Slow market conditions for thick film resistor products. Pricing has eroded to historical low levels. Alumina substrates cost is largest cost factor. Focus on 0402 & 0603 sizes for new and expanded production. Smaller (0201) size will be expanded as market acceptance increases. 0404, 0408 & 0612 Array sizes expansion ahead of larger sizes. Development of better lower TCR,sub 1.0 ohm and high 100 Mega-ohm styles [ NRC-E series ] MONTHLY CAPACITY Chip Resistor Global Market Value: 1998 = $0.82 Billion 2000 = $1.37 Billion 2002 = $0.69 Billion [ Source: 2002 Paumamanok ]

37. 37 ProductsQualityLogisticsHistory www.niccomp.comwww.niccomp.com | www.LowESR.comwww.LowESR.com Market Why NIC is preferred LEGACY LEADED TECHNOLOGIES High Voltage Ceramic Disc Capacitors 0.5pF ~ 0.22uF 12V ~ 15,000VDC Rated Temperature compensating TCs (N150 ~ N3300 PPM/degC) Taped, Bulk or Cut – Formed Lead Styles Radial / Axial Film Capacitors Polyester, Metallized Polyester, Metallized Polypropylene 1000pF ~ 6.8uF 100V ~ 630VDC Rated MLCC Radial – Axial Ceramic Capacitors NPO / X7R / Z5U 1.0pF ~ 4.7uF 50, 100, 200VDC

38. 38 ProductsQualityLogisticsHistory www.niccomp.comwww.niccomp.com | www.LowESR.comwww.LowESR.com Market Why NIC is preferred Carbon Film, Metal Film, Metal Oxide Film Resistors 1.0 ohm ~ 10 Meg-ohm 1/8W, 1/4W, 1/2W, 1W, 2W, 5W, 3W, 5W, 7W Rated +/-1%, +/-2%, +/-5% tolerance Taped or Bulk Boxed SIP Resistor Networks 4 ~ 13 Pins Common – Bussed, Isolated or Custom Circuits 10ohm ~ 3.3Meg-Ohm elements LEGACY LEADED TECHNOLOGIES

39. 39 ProductsQualityLogisticsHistory www.niccomp.comwww.niccomp.com | www.LowESR.comwww.LowESR.com Market Why NIC is preferred ENVIRONMENTAL: LEAD–FREE | PVC - FREE Environmental pressure to remove LEAD (Pb) & PVC Sleeving from components. Item defined as LEAD-FREE if lead content is less than 0.2% (NEMI) or 0.1% (JEITA) of total (component) weight World Lead-free Soldering Roadmap and Agree to Eliminate Lead by 2005 European legislation and the JEITA roadmap will use a target of 0.1wt percent. Lead-free Solder Alloy Selection… The type of solder composed of Sn-Ag-Cu is recommended for board assembly National Electronics Manufacturing Initiative (NEMI) Japan Electronics and Information Technology Industries Association (JEITA) was formed on November 1, 2000, through the merger of the Electronic Industries Association of Japan (EIAJ) and Japan Electronic Industries Development Association (JEIDA).

40. 40 ProductsQualityLogisticsHistory www.niccomp.comwww.niccomp.com | www.LowESR.comwww.LowESR.com Market Why NIC is preferred LEAD-FREE Terminal Finish Versions available today… MLCC (100% Sn) Tantalum E-Cap (100% Sn) Aluminum E-Cap (100% Sn & Sn-Bi*) Film Cap (100% Sn & Sn-Ag-Cu) Chip Resistors & Thermistors (100% Sn) Inductors & Ferrite Chip Beads (100% Sn & Sn-Cu) Diodes (100% Sn) ENVIRONMENTAL: LEAD–FREE | PVC - FREE Complete elimination of lead from terminal finish is need for compatibility to Lead-Free (Sn-Ag-Cu or Sn-Zn-Bi) soldering processes SMT Alum E-Caps: Sn-Bi* Sn-Zn-Bi group : NEC, Sharp, JVC

41. 41 ProductsQualityLogisticsHistory www.niccomp.comwww.niccomp.com | www.LowESR.comwww.LowESR.com Market Why NIC is preferred ENVIRONMENTAL: PVC - FREE Removing PVC Insulation Sleeving Aluminum E-Caps

42. 42 ProductsQualityLogisticsHistory www.niccomp.comwww.niccomp.com | www.LowESR.comwww.LowESR.com Market Why NIC is preferred

43. 43 ProductsQualityLogisticsHistory www.niccomp.comwww.niccomp.com | www.LowESR.comwww.LowESR.com Market Why NIC is preferred Flow Chart Calibration Contract Review Control of Non-Conforming Material Corrective Action Document Control Handling, Storage Packaging and Delivery Inspection and Test Status Inspection and Testing Management Responsibility Process Control Product Identification and Traceability Quality Audits Quality Records Quality System Statistical Techniques Training ISO-9001:2000 Certification Global Support – Product Quality Bruce Haskin Director of Quality Assurance NIC Components Corp. (631) 396-7500 x 221 bhaskin@niccomp.com QUALITY CONTROL

44. 44 ProductsQualityLogisticsHistory www.niccomp.comwww.niccomp.com | www.LowESR.comwww.LowESR.com Market Why NIC is preferred FLOW CHART: Customer Order QC Process

45. 45 ProductsQualityLogisticsHistory www.niccomp.comwww.niccomp.com | www.LowESR.comwww.LowESR.com Market Why NIC is preferred Calibration NIC Components maintains and controls all Measurement and Test equipment used to ensure product quality by: Identifying the calibration requirements of this equipment, and ensuring that the equipment remains in a state of calibration throughout specified intervals and conditions of use. Ensuring equipment is labeled with calibration status and next calibration due date. Using qualified external calibration facilities for all calibrations. The company maintains certified calibration records, which are traceable to NIST standards.

46. 46 ProductsQualityLogisticsHistory www.niccomp.comwww.niccomp.com | www.LowESR.comwww.LowESR.com Market Why NIC is preferred Contract Review All customer requests for quotations are reviewed by NIC Components to ensure that: The requirements are adequately defined and documented; where no written statement of requirement is available for an order received by verbal means, NIC Components ensures that the order requirements are agreed upon before their acceptance. NIC Components has the capability to meet the contract or accepted order requirements. All special contract requirements, special instructions, quality requirements, and delivery requirements are carefully reviewed, to determine whether the company is able to meet these requirements. Any requirements differing from those in the order are resolved. After acceptance, any changes to the scope of the contract will force additional contract review.

47. 47 ProductsQualityLogisticsHistory www.niccomp.comwww.niccomp.com | www.LowESR.comwww.LowESR.com Market Why NIC is preferred Control of Non-Conforming Material A documented system is in place to control non-conforming material. The procedure outlines how non-conforming material is segregated and dispositioned. All identified non-conforming material is segregated into the (RJ1) warehouse. Material received into this warehouse code cannot be inadvertently mixed or used as good inventory. The Product Manager is responsible for the disposition of non-conforming material identified during receiving inspection. The VP of Operations, Director of Quality Assurance, and the Warehouse Manager are responsible for the disposition of all other non-conforming material. Records are maintained on all non-conforming material.

48. 48 ProductsQualityLogisticsHistory www.niccomp.comwww.niccomp.com | www.LowESR.comwww.LowESR.com Market Why NIC is preferred Corrective Action The company maintains a system for the timely corrective action of all conditions detrimental to product and process quality, including deficiencies encountered during processing. Supplier, Customer and Internal Audit corrective action systems are in effect. The prime objective of the corrective action system is to preclude the recurrence of a nonconformance by identification and correction of the root cause and contributing factors.

49. 49 ProductsQualityLogisticsHistory www.niccomp.comwww.niccomp.com | www.LowESR.comwww.LowESR.com Market Why NIC is preferred Document Control The Director of Quality Assurance has overall responsibility for the creation, approval and issue of all QMS documents. The Director of Quality Assurance is also responsible for ensuring that: Copies of appropriate documents are available at all locations where operations that can affect quality are performed. Obsolete documents are promptly removed from all points of issue and use. Changes to controlled documents are permitted only after formal submission to the Director of Quality Assurance, who has overall responsibility for approving all changes. He/she will consult with the party(s) responsible for adherence to the document before approving a change.

50. 50 ProductsQualityLogisticsHistory www.niccomp.comwww.niccomp.com | www.LowESR.comwww.LowESR.com Market Why NIC is preferred Handling, Storage, Packaging, Preservation and Delivery Necessary protection of all products is provided to prevent damage, loss, deterioration, or substitution. Product is packaged with materials necessary to prevent deterioration, corrosion, or handling damage. A FIFO inventory usage system is in effect. Packaging and marking of products is in accordance with specified requirements to assure proper identification, preservation, and segregation, including delivery to the customer. Inspection and Test Status A system is in place to identify product and customer orders throughout the inspection process. Inspection status is identified on our computer system from product receipt through final inspection.

51. 51 ProductsQualityLogisticsHistory www.niccomp.comwww.niccomp.com | www.LowESR.comwww.LowESR.com Market Why NIC is preferred Inspection and Testing Inspection and Test is performed using documented procedures in the following areas: Receiving Inspection - A documented system exists for receiving inspection. 100% of all incoming receipts are visually inspected for manufacturer's part number, quantity, packaging, condition and documentation. Based on receiving history, suppliers are identified as "Skip Lot" and "Non Skip Lot". All "Non Skip Lot" suppliers require a more in-depth physical inspection. In-process Inspection - Inspection is performed during the picking process to identify product that does not meet customer special requirements such as, date code restrictions, revision levels, packaging, and labeling. When an error is detected, the product is moved to a "mark out" area-awaiting disposition. Final Inspection - 100% final inspection is performed on all orders prior to shipment. Verification of manufacturer's part number, quantity, date code, packaging, bar code labeling, and customer specific instructions are performed.

52. 52 ProductsQualityLogisticsHistory www.niccomp.comwww.niccomp.com | www.LowESR.comwww.LowESR.com Market Why NIC is preferred Management Responsibility The Director of Quality Assurance is the Management Representative responsible for all matters related to quality and the Quality Management System (QMS). The Director of Quality Assurance is a member of the company's senior management, and is afforded the authority, support, and resources necessary to adequately fulfill his/her responsibility. The Director of Quality Assurance is charged with the following: Ensuring that the Quality System is established, implemented, and maintained in accordance with the requirements of ISO 9002. Setting quality objectives with other management personnel. Determining the root causes of non-conformances, initiating corrective / preventive action and verifying solutions. Measure quality performance in key areas and review with senior management staff. All managers and supervisors are responsible for ensuring that company quality policies are understood, implemented, and maintained throughout the organization.

53. 53 ProductsQualityLogisticsHistory www.niccomp.comwww.niccomp.com | www.LowESR.comwww.LowESR.com Market Why NIC is preferred Process Control A system is established and maintained for monitoring all processing operations. Documented procedures are developed and maintained to ensure that material/product are consistently delivered to meet customer requirements. Product Identification and Traceability The part number, lot number and date code and a NIC internal item number identify all products. Inventory is traceable from the time of receipt to the time of shipment.

54. 54 ProductsQualityLogisticsHistory www.niccomp.comwww.niccomp.com | www.LowESR.comwww.LowESR.com Market Why NIC is preferred Quality Audits Internal quality audits are performed to verify that all Quality Operating Instructions are in compliance with the NI Components QA Manual. The internal quality audit addresses all clauses in ISO 9002. Personnel independent of the function(s) being audited perform audits. Corrective action requests are generated on non-conformances, and corrective action effectiveness is verified. Audit results are reviewed with the area manager/supervisor and distributed to upper management. Quality Records Quality records are maintained for all quality and inspection activities. Quality records are filed and retained for auditing, tracking, and reference purposes. Records are easily retrievable and maintained under appropriate environmental conditions. Records are kept on file for a minimum of 5 years after the conclusion of a contract or activity.

55. 55 ProductsQualityLogisticsHistory www.niccomp.comwww.niccomp.com | www.LowESR.comwww.LowESR.com Market Why NIC is preferred Quality System The Quality Management System (QMS) is comprised of the following: The Quality Assurance Manual, which defines the policies relating to the elements of ISO 9001:2000. Quality Manual Procedures (QMPs) are the instructions written at the operator level to provide the operator with precise direction on how to perform his/her tasks. Records of work and inspections performed. Auditing of the system, to ensure compliance with procedures and the requirements of ISO 9001:2000. Documentation / Data control system. Corrective / Preventive Action system. Management Review.

56. 56 ProductsQualityLogisticsHistory www.niccomp.comwww.niccomp.com | www.LowESR.comwww.LowESR.com Market Why NIC is preferred Statistical Techniques Statistical techniques are used to measure internal and external quality data. The data collected is used to identify trends, reject types, and when necessary, to initiate corrective action. The Director of Quality Assurance is responsible for creating monthly reports to be reviewed with upper management. The review is designed to monitor quality performance and continuous improvement efforts. Training It is an essential requirement of our Quality Management System that all staff be suitably trained, and demonstrate a satisfactory level of skill and knowledge in their functional areas. Training records are kept on file and updated accordingly.

57. 57 ProductsQualityLogisticsHistory www.niccomp.comwww.niccomp.com | www.LowESR.comwww.LowESR.com Market Why NIC is preferred ISO-9001:2000 Certification NIC has been ISO-9002 certified since February 01, 1996 NIC received ISO-9001:2000 certification on October 20th, 2002 Auditor: Underwriter's Laboratories Inc. Certification covers NIC facilities located: Melville, NY (USA) & San Jose, CA (USA)

58. 58 ProductsQualityLogisticsHistory www.niccomp.comwww.niccomp.com | www.LowESR.comwww.LowESR.com Market Why NIC is preferred NIC Global Support – Product Quality Asia Operations: NIC Components Asia Pte Ltd 701 Sims Drive, #07-01 LHK Building Singapore 387383 Tel: 65-8441575 Fax: 65-8441646 1 Supplier Quality Personnel on Staff European Operations: NIC Eurotech Ltd 14 Top Angel Buckingham Industrial Park Buckingham MK18 1TH United Kingdom Tel: 44 1280 813 737 Fax: 44 1280 814 737 1 Supplier Quality Personnel on Staff e-mail: Global Technical Support: tpmg@niccomp.comtpmg@niccomp.com North American Operations Corporate Head Quarters: NIC Components Corp. 70 Maxess Road Melville, NY 11747 Tel (631) 396-7500 Fax (631) 396-7575 3 Supplier Quality Personnel on Staff Japan Operations Nippon Industries (Tokyo, Japan) 3 Supplier Quality Personnel on Staff Taiwan Operations NIC - EIAN (Taiwan) 1 Supplier Quality Personnel on Staff

59. 59 ProductsQualityLogisticsHistory www.niccomp.comwww.niccomp.com | www.LowESR.comwww.LowESR.com Market Why NIC is preferred

60. 60 ProductsQualityLogisticsHistory www.niccomp.comwww.niccomp.com | www.LowESR.comwww.LowESR.com Market Why NIC is preferred NIC Global Logistics Locations Asia Operations: NIC Components Asia Pte Ltd 701 Sims Drive, #07-01 LHK Building Singapore 387383 Additional Sales Personnel in:  Penang, Malaysia  Hong Kong  Shanghai, China European Operations: NIC Eurotech Ltd 14 Top Angel Buckingham Industrial Park Buckingham MK18 1TH United Kingdom North American Operations Corporate Head Quarters: NIC Components Corp. 70 Maxess Road Melville, NY 11747 Japan Operations Nippon Industries (Tokyo, Japan) Taiwan Operations NIC – EIAN (Taipei, Taiwan) West Coast Operations: NIC Components Corp. 2070 Ringwood Avenue San Jose, CA 95131 3PL:  Monterey, Mexico  Guadalajara,Mexico 3PL:  Hong Kong

61. 61 ProductsQualityLogisticsHistory www.niccomp.comwww.niccomp.com | www.LowESR.comwww.LowESR.com Market Why NIC is preferred Global Support Shared Unified Data-base Move programs – builds from location to location seamlessly Single Global Part Numbers No competing -disputing regional divisions

62. 62 ProductsQualityLogisticsHistory www.niccomp.comwww.niccomp.com | www.LowESR.comwww.LowESR.com Market Why NIC is preferred NIC CA NIC COMP ASIA NIC NY NIC CA NIC EUROTECH NIC NY NIC EUROTECH Global Support Network

63. 63 ProductsQualityLogisticsHistory www.niccomp.comwww.niccomp.com | www.LowESR.comwww.LowESR.com Market Why NIC is preferred NIC Components Corporation [ ™], in association with Nippon Industries Co. Ltd is a designer, manufacturer and worldwide supplier of passive components. Established in 1975 as a manufacturer of aluminum electrolytic capacitors, NIC has developed into a major supplier of capacitors, resistors, magnetics and specialty products. Using Nippon Industries' manufacturing and design expertise, a select group of specialized factories was recruited to augment our core products and add complimentary products to our expansive line. NIC's expertise and diligence in selection and integration of quality fabs is world-renowned. Long-term supplier relationships (averaging over ten years) have been fostered by shared strategy and partnering management teams. Quality is our number one commitment. Every step, from component design to raw material selection, manufacturing processing to final inspection is meticulously controlled. 19751982199019961998 Nippon Industries Company - Japan “NIC” NIC Components Corp. (North America) NIC West (San Jose) NIC Eurotech (Europe) NIC Asia (SE Asia) 2000~2002 NIC Regional Sales Offices Pacific North West South East Southern California Canada

64. 64 ProductsQualityLogisticsHistory www.niccomp.comwww.niccomp.com | www.LowESR.comwww.LowESR.com Market Why NIC is preferred

65. 65 ProductsQualityLogisticsHistory www.niccomp.comwww.niccomp.com | www.LowESR.comwww.LowESR.com Market Why NIC is preferred NIC Products SURFACE MOUNT COMPONENTS Capacitors: » Aluminum Electrolytic Capacitors » Ceramic Capacitors: Chip - Array - IPC » Film Capacitors » Tantalum Electrolytic Capacitors » Low ESR Electrolytic Capacitors Resistive Products: » Thick Film Chip - Array - IPC » NTC Thermistors Magnetics: » Inductors » Ferrite Beads Diodes & Circuit Protection: » Silicon Rectifier Diodes » Schottky Barrier Diodes » Varistors (MLV) NEW! Lead-Free Products

66. 66 ProductsQualityLogisticsHistory www.niccomp.comwww.niccomp.com | www.LowESR.comwww.LowESR.com Market Why NIC is preferred NIC Products LEADED (TH) COMPONENTS Capacitors: » Aluminum Electrolytic Capacitors » Ceramic Capacitors » Film Capacitors » Tantalum Electrolytic Capacitors Resistive Products: » Film Resistors » Networks NEW! Lead-Free Products

67. 67 ProductsQualityLogisticsHistory www.niccomp.comwww.niccomp.com | www.LowESR.comwww.LowESR.com Market Why NIC is preferred Cutting Edge Technology Ultra- Low ESR Capacitors: Solid Aluminum E-Caps NEW! Lead-Free Products

68. 68 ProductsQualityLogisticsHistory www.niccomp.comwww.niccomp.com | www.LowESR.comwww.LowESR.com Market Why NIC is preferred Cutting Edge Technology Ultra- Low ESR Capacitors: Solid Aluminum E-Caps NEW! Lead-Free Products

69. 69 ProductsQualityLogisticsHistory www.niccomp.comwww.niccomp.com | www.LowESR.comwww.LowESR.com Market Why NIC is preferred Cutting Edge Technology Low ESR Capacitors: Hybrid Electrolyte Aluminum E-Caps NEW! Lead-Free Products

70. 70 ProductsQualityLogisticsHistory www.niccomp.comwww.niccomp.com | www.LowESR.comwww.LowESR.com Market Why NIC is preferred Cutting Edge Technology Low ESR Capacitors: Polymer Cathode Tantalum E-Caps NEW! Lead-Free Products

71. 71 ProductsQualityLogisticsHistory www.niccomp.comwww.niccomp.com | www.LowESR.comwww.LowESR.com Market Why NIC is preferred Cutting Edge Technology Low ESR Capacitors: High Capacitance & High Frequency MLCCs NEW! Lead-Free Products

72. 72 ProductsQualityLogisticsHistory www.niccomp.comwww.niccomp.com | www.LowESR.comwww.LowESR.com Market Why NIC is preferred Cutting Edge Technology High Frequency (Wireless) Design Components NEW! Lead-Free Products

73. 73 ProductsQualityLogisticsHistory www.niccomp.comwww.niccomp.com | www.LowESR.comwww.LowESR.com Market Why NIC is preferred Cutting Edge Technology Ultra-Small (0201) Components » MLCC Capacitors » Chip Inductors » Chip Resistors NEW! Lead-Free Products

74. 74 ProductsQualityLogisticsHistory www.niccomp.comwww.niccomp.com | www.LowESR.comwww.LowESR.com Market Why NIC is preferred END