FPI BOARD OF DIRECTORS DECISION ON ELECTRIC PORTABLE AND HAND LIGHTING EQUIPMENT -- CONTINUATION THIS IS THE CONTINUATION OF THE FPI BOARD OF DIRECTORS DECISION ON ELECTRIC PORTABLE AND HAND LIGHTING EQUIPMENT. Potential FPI Impact It is the determination of the Board of Directors that, with the further concessions made to address concerns of Multi-Spec and Tek-Lite, the sales levels requested by FPI would not place an undue burden upon the electric portable and hand lighting equipment industry or labor. We based this determination on the record, including the following conclusions: * Most vendors active in the Federal electric portable and hand lighting equipment market are either diversified manufacturers or distributors of a wide variety of products across various FSC code categories. The exceptions are those manufacturers primarily involved with flashlight production. However, two vendors, Multi-Spec Products and Tek-Lite, Inc., rely heavily on the FSC code 6230 market, deriving approximately 50 percent of total sales from this particular Federal market. Based on concerns raised in correspondence received from these two companies, FPI modified its original proposal to eliminate specific National Stock Number (NSN) items made over a three-year period from production. After additional comments provided during the Board hearing, the Board has further reduced FPI's proposal by excluding from production, all items on the lists previously provided by these two companies via original facsimiles, dated August 12 and 13, 1999, and subsequent October 1, 1999 original facsimile letter, to be protected for a period of seven years. This means FPI will not attempt to secure these items for its production, unless either of these two companies has not made such items during the previous seven-year period. Given this additional commitment, the Board is confident that concerns raised by Multi-Spec and Tek-Lite have been adequately addressed, and that FPI's production of other items within this supply class would not have an adverse impact on these two companies. * No civilian jobs within the domestic industry should be lost as a result of this initiative. BOARD DECISION It is the finding of the FPI Board of Directors that the sales levels proposed represent a reasonable share of the market and that proposed production levels will not pose an undue burden of competition on the industry excluding those items previously addressed. Therefore, the Board authorizes FPI to produce electric portable and hand lighting equipment at the following levels: FY 2000 -- $19,000,000; FY 2001 -- $22,000,000; FY 2002 -- $23,000,000; FY 2003 -- $24,000,000; and, FY 2004 -- $25,000,000. While the sales levels equate to projected market share, as reflected in the study, primarily for ease of reference and tracking, it is the decision of the Board to use sales dollars as the measure for expansion. The Board recognizes that it is difficult to achieve exact levels each year. It is therefore understood that FPI may exceed the annual limits by insubstantial amounts, so long as the aggregate over the five-year period doesnot exceed the five-year approved total of $113 million. Should the industry believe that circumstances have changed sufficiently that FPI's authorized production is having a substantially greater impact than anticipated in this decision, the industry is invited to provide, at their convenience, such written information to the Board. The Board will carefully review this information and, if warranted, may reconsider the issue. Decided on this 31st day of December, 1999. For the Board: Joseph M. Aragon, Chairman Posted 01/06/00 (W-SN413730).

Loren Data Corp. http://www.ld.com (SYN# 0424 20000110\SP-0023.MSC)