1. EGF – Supplier report Understand and Apply

2. September 17, 2010 2 Supplier Performance Evaluation 1.EGF Presentation 2.EGF Composition 3.Detailed Scoring Tables 4.Supplier Scorecard 5.FAQ

3. September 17, 2010 3 EGF (“Évaluation Globale Fournisseur”, comprehensive supplier evaluation) The EGF system is a monthly scoring system based on many delivery & quality factors. The lower the scoring, the better the performance. The upper acceptable limit is 100 points. Objectives To allow Nova Bus to measure our suppliers and prioritize our actions. To work with our suppliers with the aim of receiving better quality product and more precise deliveries. To standardize our performance measures and eliminate subjective elements.

4. September 17, 2010 4 EGF Composition  EGF = QPM + DPM EGF  QPM = Quality Performance Measure  PPM (parts per million) PPM  Quantity of non-conforming partsnon-conforming  Quantity of MCN (Material Complaint Notices)MCN  Monetary value ratio of non-conforming parts  DPM = Delivery Performance Measure  Quantity of faulty deliveriesfaulty deliveries  Percentage of faulty deliveries  Quantity of late deliverieslate deliveries  The QPM and DPM are both based on a rolling 3-month horizon An action plan is requested when the EGF score exceeds 100 points.

5. September 17, 2010 5 DPM Scoring Table DPM Livraisons fautives Faulty Deliveries (#) - DA Livraisons fautives Faulty deliveries (%) DB Livraisons en retard Late deliveries (#) DC Statut DPM Status DeÀPtsDe (%)À (%)PtsDeÀPts>90Alarme / Alarm 01000 005055-90Action 112051120106 535-50Surveillance / Monitor 215010214015112010<35Pas d'action / No action 5110020416020213015 1012003061 25315020 2014004051 25 401 50

6. September 17, 2010 6 QPM Scoring Table QPM PPM -QA Pièces rejetées Rejected Parts (#)-QB MCN (#)-QC Volume rejeté Rejected volume (%)-QD DeÀPtsDeÀPtsDeÀPtsDeÀPts 01000000010000 10150051552250,010,155 5012000106251034 0,160,410 2001500015262501558200,41115 5001 20251 20912301,01 20 13 40 Statuts QPM Status >90Alarme / Alarm 70-90Action 50-65Surveillance / Monitor <50Pas d'action / No action

7. September 17, 2010 7 Supplier Scorecard Objective  To inform suppliers rapidly and effectively of the evolution of their performance. Results  Highly visual scorecard with graphic elements  EGF results as well as 5 other important factors  More detailed data available on other sheets  Blue columns = Rolling data (cumulative EGF for the last 3 months)  Black columns = monthly data only

8. September 17, 2010 8

9. 9 FAQ 1.What is the utility of this system?What is the utility of this system? 2.How to read the Scoring TablesHow to read the Scoring Tables 3.How is the EGF calculated?How is the EGF calculated? 4.What is the difference between a faulty delivery and a late delivery?What is the difference between a faulty delivery and a late delivery? 5.How can we improve our score?How can we improve our score? 6.Who should we contact for more details regarding our EGF score?Who should we contact for more details regarding our EGF score? 7.How often is the EGF Scorecard issued?How often is the EGF Scorecard issued? 8.Are previous results revised?Are previous results revised? 9.What should we do if we want to challenge a MCN?What should we do if we want to challenge a MCN?

10. September 17, 2010 10 1. What is the utility of this system? This system is based on timely information and is consistent for all suppliers. This eliminates subjective aspects in evaluating supplier performance. This system highlights aspects to target and prioritize, in order to increase supplier quality levels and delivery performance.

11. September 17, 2010 11 2. How to read the Scoring Table? You can refer to the Supplier Scorecard. The information is presented in a complete and visual way. It shows information concerning the various measured aspects that affect the overall score.Supplier Scorecard The system focuses on two (2) critical aspects that add up to give an overall performance level; they are product quality and supplier delivery performance. EGF=DPM+QPM EGF=DPM+QPM By referring to the scoring tables (DPM and QPM) you will be able to know which aspects affect your resultDPM QPM The maximum acceptable EGF score is 100 points. An action plan is requested for scores that exceed this limit. Action plans may also be requested if either the QPM or DPM reach “Action” level.

12. September 17, 2010 12 3. How is the EGF calculated? The EGF score breaks down as follows: EGF DPM Number of Faulty deliveries Percentage of Faulty deliveries Number of late deliveries QPM PPM Number of rejected parts Number of MCN Volume of rejected parts

13. September 17, 2010 13 4. What is the difference between faulty deliveries and late deliveries? Firstly, we should mention that a delivery is a complete quantity listed on a single line on a purchase order. Therefore, if the same part appears on several lines, they are considered separate deliveries. So, an on-time delivery is the delivery of a full quantity of parts ordered on a single line, within the allowed timeframe. i.e. no more than four (4) days in advance to no further than one (1) day late. A faulty delivery is a delivery made outside of the allowed timeframe. Therefore, a late delivery is any delivery made more than one (1) day after the requested date. Please note that every faulty delivery causes delays and additional fees that Nova Bus must incur, even in the case of early deliveries.

14. September 17, 2010 14 5. How can we improve our score? You can improve your EGF score by targeting the information provided in the scoring details. In general, you should be able to identify causes by seeking out chronic problems. With this information, you will be able to draw up an action plan. This plan can be submitted to Nova Bus for follow up. Please note that action plans are mandatory whenever EGF totals exceed 100 or if either the QPM or DPM reach “Action” level.

15. September 17, 2010 15 6. Who should we contact for more details regarding our EGF score? DPM: Your Logistics Planner will be able to provide you with a detailed report on faulty deliveries. QPM: Your Supplier Quality Technician will be able to provide you with a summary of issued MCN.

16. September 17, 2010 16 7. How often is the EGF Scorecard issued? The EGF Scorecard is issued at the beginning of each month. The data represented are those from last three months and those from the last month.

17. September 17, 2010 17 8. Are previous results revised? Yes. Results of the 12 previous months are updated every month. Therefore, if a change is made to an MCN that is older than 3 months, results are corrected.

18. September 17, 2010 18 9. What should we do if we want to challenge a MCN? If you do not reach the same conclusions as Nova Bus regarding a complaint, you should answer the issued MCN and contact your Supplier Quality Technician. Your arguments will be taken in consideration and the MCN will be reassessed.

19. September 17, 2010 19 Glossary EGF: Comprehensive supplier evaluation PPM: Ratio of defective parts to total quantity received, brought back to 1 million Non-conforming part: Part presenting a defect that affects the function of the part MCN: Material Complaint Notice. It is how Nova Bus informs supplier when received parts do not meet quality requirements Faulty delivery: Part delivered outside of the allowed time frame [-4, +1]: 4 days early to 1 day late Late delivery: Part delivered more than one day late according to the requested date.