What does the term “X-out” mean in the PCB industry?

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In the PCB industry, the term “X-out” also known as “Cross-board” and “X-board”. It stands for the defective boards in PCB panels, and X marks are usually marked on the top.
Normally, the SMT factory will not allow X-out boards appear in PCB panels, because it cause the loss of efficiency during the process of SMT. However, the X-out boards is inevitable while producing PCBs, the more PCBs in one single panel, the more likely X-out boards appear.
The Acceptable Quality Level (AQL) for X-out boards in the PCB industry, generally, the number of X-out boards must be less than 20% of the number of PCBs in a panel. That is, in a panel with 4 pieces of PCBs, only allowed 1 X-out board in it. In a panel with 8 pieces of PCBs, only allowed 2 X-out boards. And the total amount of X-out boards must be less than 10% of total PCB shipments.
When about to ship the PCBs, must be assured that in each vacuum bag, the position of X-out boards must be the same position in each panel. If the X-out boards less than the quantity of the whole package, it must be packed in the mantissa box, and clearly marked with the total quantity of PCBs and X-out boards and relevant information.
If the buyers allow X-out boards to exist in PCB panels, the SMT factory can skip the X-out boards without doing SMT process by modifying the SMT program or by identify the bad marks on PCBs. But it will cause the SMT efficiency loss.
If the buyers will NOT allow X-out boards to exist, it means the PCB manufacturers are forced to produce more PCB panels, in order to eliminate the PCB panels, which has X-out boards in it. Therefore, the purchase cost will increase, but the SMT process will achieve the maximum of efficiency.