Revision Ver 1.0 October 14, 1998

LM151X2

Liquid Crystal Display

Product Specification

12. Incoming Inspection Standards for TFT-LCD Modules

1. Scope

This incoming inspection standard shall be applied to TFT-LCD Modules(hereafter called ”LCMs”) supplied

by LG Electronics Inc.(hereafter called the ”Supplier”) to Customer.

2. Incoming inspection

The Customer shall have the right to conduct at its own cost and expense, an incoming inspection of the

LCMs at the destination specified in the relevant bills of lading in accordance with the LCM’s specifications

separately agreed upon and the inspection standard set forth in this article.

The Customer shall notify the Supplier in writing of the inspection results(acceptance or rejection) in

accordance with the said inspection standard within 40 days after the date of the bills of lading.

Should Customer fail to so notify the Supplier within the said 40 days period, the Customer’s right to reject

the LCMs shall then lapse, and the said LCMs shall be deemed to have been accepted by the Customer.

3. Method of Incoming inspection

Unless otherwise agreed upon in writing, the sampling inspection method based on MIL-STD-105E shall be

applied to the Customer’s incoming inspection.

4. Classification of defects

Defects are classified as either a major defect or a minor defect based on the degree of defect defined

herein.

a) Major defect

A major defect is a defect that is likely to result in product failure, or reduction in the product’s intended

usage.

b) Minor defect

A minor defect is a defect that has little bearing on the effective use or operation of the product.

Specific criteria of judgement of major and/or minor defects or other related issues shall be in accordance

with the attached ”Classification of Defects”. (refer to appendix 4)

5. Acceptable Quality Level(”AQL”)

The AQL for major and minor defects shall be respectively set forth below.

a) Major defects : AQL = 0.65%

b) Minor defects : AQL = 1.5%

6. Sampling Inspection Method

a) Lot size : Quantity per shipment lot

b) Sampling type : Normal inspection, Single sampling

c) Inspection level : II

d) Sampling table : Table in MIL-STD-105E

7. Determination of acceptability and subsequent disposal

If the number of defects found in the LCM sampling lot is equal to or less than the applicable acceptance

level, the lot shall be accepted.

If the number of defects is greater than the applicable acceptance level, the lot shall be rejected. The

Customer shall inform the Supplier of the detailed results of such inspection within the time period stipulated

in item #2 ”Incoming inspection”.

a) Accepted lot

An acceptance under the above incoming inspection shall constitute an acceptance by the Customer of

such lot of the LCMs in terms of the landed quality thereof.

b) Rejected lot

If a shipment lot of products is rejected under the above incoming inspection due to any defects for which

the Supplier is responsible and such a fact is clearly confirmed by the Supplier through a separate

inspection or as otherwise decided, the Supplier shall choose one of the following three options which

must be determined by mutual consent. The Supplier shall advise the Customer of its choice not later than

14 working days(Monday to Friday) of receipt of the ”Customer’s notification of rejected lot” :

-1. The Customer shall return the rejected lot to the place to be designated by the Supplier and the

Supplier shall screen all of the products in the lot and repair or replace the defective products.

Alpha Point Ltd.

P.O. Box 41

00751 Helsinki, Finland

http://www.alpha.fi

Tel.: +358-9-34 64 34 1

Fax: +358-9-34 64 34 2