Virginia Transformer Price Adjustment Policy and Index

EFFECTIVE MARCH 29, 2004 – Rev2 May 1, 2006

As a result of significant commodity fluctuations in the market, Virginia Transformer Corp has established a Price Adjustment Policy effective March 29, 2004 as described below. Further, this policy has been revised to a monthly index from quarterly index as of January 1, 2005 and has been further revised to adjust the commodity weightings as of May 1, 2006.

POLICY:

VTC’s selling price will be subject to adjustment at the time of shipment based on a monthly price index as described in this policy. The current price index will be based on the commodity costs for the prior month. The price at shipment will be the quoted price times the price index ratio at the time of shipment. Any resulting purchase order must acknowledge this Price Adjustment Policy.

A1. PRICE INDEX:

A monthly price index (Iq) will be based on the Comex, Core, Steel, Oil, Major Accessories and Labor costs at the middle of each month for the month. Iq for January 2004 will be 1.0. The price index will be published to the VTC web site at the beginning of each month and will be effective for the whole month. The index will be based on the prior month’s prices.

A2. PRICE ADJUSTMENT CALCULATION:

The price index will be used to calculate the adjustment applied to the price at shipment per the below equation:

Equation

Where:

  • Iq = New Price Index for month of shipment
  • I0 = Original Price Index at time of quote
  • Pn = New Price at shipment after adjustment
  • P0 = Original Price at time of quote

Customer price will be increased or decreased at the time of shipment as indicated by the index ratio. The quote proposal will contain the index used at time of proposal.

Virginia Transformer Price Index tracking began on January 1, 2004 with a base index of 1.00

Monthly Price Index (Series 3)**
Effective May 1, 2006 for Oil type w/Copper Windings
2011 January
2.234
February 2.279
March 2.231
April 2.313
May 2.333
June 2.305
July 2.327
August 2.380
September 2.332
October 2.316
November 2.282
December 2.212
Monthly Price Index (Series 3)**
Effective May 1, 2006 for Oil type w/Copper Windings
2012 January
2.227
February 2.207
March 2.253
April 2.296
May 2.296
June 2.258
July 2.210
August 2.202
September 2.191
October 2.224
November 2.243
December 2.213
Monthly Price Index (Series 3)**
Effective May 1, 2006 for Oil type w/Copper Windings
2013 January
2.192
February 2.193
March 2.190
April 2.179
May 2.154
June 2.162
July 2.140
August 2.092
September 2.103
October 2.102
November 2.113
December 2.104
Monthly Price Index (Series 3)**
Effective May 1, 2006 for Oil type w/Copper Windings
2014 January
2.122
February 2.145
March 2.154
April 2.120
May
June
July
August
September
October
November
December

**Index adjusted May 1, 2006 for weighting change due to change in relative price of copper and core steel.

Dry Type Price Index
(For Copper Windings) Index Effective July 1, 2006
2011 January
1.773
February 1.807
March 1.833
April 1.812
May 1.806
June 1.777
July 1.791
August 1.846
September 1.804
October 1.795
November 1.772
December 1.756
Dry Type Price Index
(For Copper Windings) Index Effective July 1, 2006
2012 January
1.768
February 1.763
March 1.794
April 1.820
May 1.820
June 1.786
July 1.759
August 1.773
September 1.762
October 1.794
November 1.801
December 1.777
Dry Type Price Index
(For Copper Windings) Index Effective July 1, 2006
2013 January
1.766
February 1.780
March 1.781
April 1.762
May 1.742
June 1.749
July 1.733
August 1.715
September 1.718
October 1.721
November 1.727
December 1.720
Dry Type Price Index
(For Copper Windings) Index Effective July 1, 2006
2014 January
1.722
February 1.742
March 1.733
April 1.706
May
June
July
August
September
October
November
December


Oil Type Price Index
(For Aluminum Windings) Index Effective June 1, 2007
2011 January
1.102
February 1.118
March 1.125
April 1.137
May 1.157
June 1.154
July 1.159
August 1.166
September 1.164
October 1.164
November 1.159
December 1.148
Oil Type Price Index
(For Aluminum Windings) Index Effective June 1, 2007
2012 January
1.138
February 1.142
March 1.153
April 1.158
May 1.159
June 1.152
July 1.140
August 1.132
September 1.132
October 1.139
November 1.150
December 1.147
Oil Type Price Index
(For Aluminum Windings) Index Effective June 1, 2007
2013 January
1.151
February 1.139
March 1.141
April 1.142
May 1.146
June 1.142
July 1.143
August 1.133
September 1.133
October 1.130
November 1.143
December 1.139
Oil Type Price Index
(For Aluminum Windings) Index Effective June 1, 2007
2014 January
1.139
February 1.149
March 1.147
April 1.146
May
June
July
August
September
October
November
December