Common use of Cost Reduction Projects Clause in Contracts

Cost Reduction Projects. BreconRidge agrees to seek ways (“Initiatives”) to reduce the cost of manufacturing Products by methods such as elimination of Materials, redefinition of Specifications and re-design of assembly or test methods. Before it undertakes an Initiative, BreconRidge shall obtain Customer’s written confirmation using a confirmation sheet the format of which shall be mutually agreed by the parties. Upon implementation of a BreconRidge Initiative which has been so confirmed by Customer and where the engineering effort to analyze and implement the Initiative has been paid by BreconRidge, BreconRidge will receive * of the demonstrated cost reduction that is over and above the * cost reductions contemplated by Schedule 10.2 (KPIs), for * months after - 2 - such implementation. Customer will receive 100% of the cost reductions resulting from the implementation of Initiatives conceived by Customer. Any cost reduction projects that involve material changes to Customer’s design of the Product shall be agreed upon by the Parties and documented in a separate agreement. The parties shall use value added/value engineering (VAVE) reports as a tool for confirming which party conceived of an Initiative, the approvals needed for the Initiative to proceed and the amount of the resulting cost reduction.

Cost Reduction Projects. BreconRidge agrees to seek ways (“Initiatives”) to reduce the cost of manufacturing Products by methods such as elimination of Materials, redefinition of Specifications and re-design of assembly or test methods. Before it undertakes an Initiative, BreconRidge shall obtain Customer’s written confirmation using a confirmation sheet the format of which shall be mutually agreed by the parties. Upon implementation of a BreconRidge Initiative which has been so confirmed by Customer and where the engineering effort to analyze and implement the Initiative has been paid by BreconRidge, BreconRidge will receive * of the demonstrated cost reduction that is over and above the * cost reductions contemplated by Schedule 10.2 (KPIs), for * months after - 2 - such implementation. Customer will receive 100% of the cost reductions resulting from the implementation of Initiatives conceived by Customer. Any cost reduction projects that involve material changes to Customer’s design of the Product shall be agreed upon by the Parties and documented in a separate agreement. The parties shall use value added/value engineering (VAVE) reports as a tool for confirming which party conceived of an Initiative, the approvals needed for the Initiative to proceed and the amount of the resulting cost reduction.