It hss been noticed recently that applet fails to load throwing exceptions listed below though issue is not consistently reproducible. This bug report conatins 2 issues one is related to applet using JNLP and other one is related to applets using legacy html approach. While latter is less serious since the ClassNotFoundException disappears on refreshing/reloading the page with applet getting loaded fine for subsequent reloads but former seems to be more serious where applet fails to load at all. Refreshing and reloading of page is not helping in this case.

Test Applets to reproduce issue:
- Applets not using JNLP:
http://nicole1.sfbay.sun.com:8080/plugin_tests/JNLPSupport/desktopInteg/paramtest/paramtest.html

- Same Applets using JNLP:
http://nicole1.sfbay.sun.com:8080/plugin_tests/JNLPSupport/desktopInteg/paramtest/paramtest1.html
http://nicole1.sfbay.sun.com:8080/plugin_tests/JNLPSupport/desktopInteg/other/soundtest.html

1) Applet using JNLP files.
 This one seems to be serious as applet totally fails to load once, below mentioned, exceptions occurs.  Points to be noted here
 - In the same browser session same applet, but not using JNLP file, gets loaded fine.
 - In the same browser session though applets fails to load complaining about missing JNLP file but the pointed JNLP file can be accessed and launched directly from the browser.
- Same Applet works fine when tried to launch again on the same machine in a different browser session which confirms that issue was not in actual with JNLP file hosting.

java.io.FileNotFoundException: JNLP not available: paramtest1.jnlp
at sun.plugin2.applet.JNLP2Manager.loadJarFiles(Unknown Source)
at sun.plugin2.applet.Plugin2Manager$AppletExecutionRunnable.run(Unknown Source)
at java.lang.Thread.run(Unknown Source)
Exception: java.io.FileNotFoundException: JNLP not available: paramtest1.jnlp

Further refresh or reload of browser leads to following set of exceptions getting thrown
jException in thread "AWT-EventQueue-9" java.lang.InternalError: couldn't create component peer
at sun.awt.windows.WComponentPeer.checkCreation(Unknown Source)
at sun.awt.windows.WComponentPeer.<init>(Unknown Source)
at sun.awt.windows.WCanvasPeer.<init>(Unknown Source)
at sun.awt.windows.WPanelPeer.<init>(Unknown Source)
at sun.awt.windows.WWindowPeer.<init>(Unknown Source)
at sun.awt.windows.WFramePeer.<init>(Unknown Source)
at sun.awt.windows.WEmbeddedFramePeer.<init>(Unknown Source)
at sun.awt.windows.WToolkit.createEmbeddedFrame(Unknown Source)
at sun.awt.windows.WEmbeddedFrame.addNotify(Unknown Source)
at sun.awt.windows.WEmbeddedFrame.<init>(Unknown Source)
at sun.plugin2.main.client.PluginEmbeddedFrame.<init>(Unknown Source)
at sun.plugin2.main.client.PluginMain$StartAppletRunner.run(Unknown Source)
at java.awt.event.InvocationEvent.dispatch(Unknown Source)
at java.awt.EventQueue.dispatchEvent(Unknown Source)
at java.awt.EventDispatchThread.pumpOneEventForFilters(Unknown Source)
at java.awt.EventDispatchThread.pumpEventsForFilter(Unknown Source)
at java.awt.EventDispatchThread.pumpEventsForHierarchy(Unknown Source)
at java.awt.EventDispatchThread.pumpEvents(Unknown Source)
at java.awt.EventDispatchThread.pumpEvents(Unknown Source)
at java.awt.EventDispatchThread.run(Unknown Source)

com.sun.deploy.net.FailedDownloadException: Unable to load resource: http://nicole1.sfbay.sun.com:8080/plugin_tests/JNLPSupport/desktopInteg/paramtest/paramtest.jar
at com.sun.deploy.net.DownloadEngine.actionDownload(Unknown Source)
at com.sun.deploy.net.DownloadEngine.getCacheEntry(Unknown Source)
at com.sun.deploy.net.DownloadEngine.getCacheEntry(Unknown Source)
at com.sun.deploy.net.DownloadEngine.getResourceCacheEntry(Unknown Source)
at com.sun.deploy.net.DownloadEngine.getResourceCacheEntry(Unknown Source)
at com.sun.deploy.net.DownloadEngine.getResource(Unknown Source)
at com.sun.javaws.LaunchDownload.downloadJarFiles(Unknown Source)
at com.sun.javaws.LaunchDownload.downloadEagerorAll(Unknown Source)
at sun.plugin2.applet.JNLP2Manager.downloadResources(Unknown Source)
at sun.plugin2.applet.JNLP2Manager.prepareLaunchFile(Unknown Source)
at sun.plugin2.applet.JNLP2Manager.loadJarFiles(Unknown Source)
at sun.plugin2.applet.Plugin2Manager$AppletExecutionRunnable.run(Unknown Source)
at java.lang.Thread.run(Unknown Source)
Caused by:
java.net.SocketException: Unknown proxy type : HTTP
at java.net.SocksSocketImpl.connect(Unknown Source)
at java.net.Socket.connect(Unknown Source)
at sun.net.NetworkClient.doConnect(Unknown Source)
at sun.net.www.http.HttpClient.openServer(Unknown Source)
at sun.net.www.http.HttpClient.openServer(Unknown Source)
at sun.net.www.http.HttpClient.<init>(Unknown Source)
at sun.net.www.http.HttpClient.New(Unknown Source)
at sun.net.www.protocol.http.HttpURLConnection.getNewHttpClient(Unknown Source)
at sun.net.www.protocol.http.HttpURLConnection.plainConnect(Unknown Source)
at sun.net.www.protocol.http.HttpURLConnection.connect(Unknown Source)
at sun.net.www.protocol.http.HttpURLConnection.getInputStream(Unknown Source)
at com.sun.deploy.net.HttpUtils.followRedirects(Unknown Source)
at com.sun.deploy.net.BasicHttpRequest.doRequest(Unknown Source)
at com.sun.deploy.net.BasicHttpRequest.doRequest(Unknown Source)
at com.sun.deploy.net.BasicHttpRequest.doGetRequest(Unknown Source)
at com.sun.deploy.net.DownloadEngine.actionDownload(Unknown Source)
at com.sun.deploy.net.DownloadEngine.getCacheEntry(Unknown Source)
at com.sun.deploy.net.DownloadEngine.getCacheEntry(Unknown Source)
at com.sun.deploy.net.DownloadEngine.getResourceCacheEntry(Unknown Source)
at com.sun.deploy.net.DownloadEngine.getResourceCacheEntry(Unknown Source)
at com.sun.deploy.net.DownloadEngine.getResource(Unknown Source)
at com.sun.javaws.LaunchDownload.downloadJarFiles(Unknown Source)
at com.sun.javaws.LaunchDownload.downloadEagerorAll(Unknown Source)
at sun.plugin2.applet.JNLP2Manager.downloadResources(Unknown Source)
at sun.plugin2.applet.JNLP2Manager.prepareLaunchFile(Unknown Source)
at sun.plugin2.applet.JNLP2Manager.loadJarFiles(Unknown Source)
at sun.plugin2.applet.Plugin2Manager$AppletExecutionRunnable.run(Unknown Source)
at java.lang.Thread.run(Unknown Source)
Exception: com.sun.deploy.net.FailedDownloadException: Unable to load resource: http://nicole1.sfbay.sun.com:8080/plugin_tests/JNLPSupport/desktopInteg/paramtest/paramtest.jar

2) Applet NOT using JNLP files
Following exception is getting thrown while loading the applets for the first time. On refreshing or reload this exception disappears and applet is getting loaded fine against all subseuqent reloads.

java.lang.ClassNotFoundException: AppletParamTest.class
at sun.plugin2.applet.Applet2ClassLoader.findClass(Unknown Source)
at java.lang.ClassLoader.loadClass(Unknown Source)
at java.lang.ClassLoader.loadClass(Unknown Source)
at sun.plugin2.applet.Plugin2ClassLoader.loadCode(Unknown Source)
at sun.plugin2.applet.Plugin2Manager.createApplet(Unknown Source)
at sun.plugin2.applet.Plugin2Manager$AppletExecutionRunnable.run(Unknown Source)
at java.lang.Thread.run(Unknown Source)
Caused by: java.net.SocketException: Unknown proxy type : HTTP
at java.net.SocksSocketImpl.connect(Unknown Source)
at java.net.Socket.connect(Unknown Source)
at sun.net.NetworkClient.doConnect(Unknown Source)
at sun.net.www.http.HttpClient.openServer(Unknown Source)
at sun.net.www.http.HttpClient.openServer(Unknown Source)
at sun.net.www.http.HttpClient.<init>(Unknown Source)
at sun.net.www.http.HttpClient.New(Unknown Source)
at sun.net.www.protocol.http.HttpURLConnection.getNewHttpClient(Unknown Source)
at sun.net.www.protocol.http.HttpURLConnection.plainConnect(Unknown Source)
at sun.net.www.protocol.http.HttpURLConnection.connect(Unknown Source)
at sun.net.www.protocol.http.HttpURLConnection.getInputStream(Unknown Source)
at java.net.HttpURLConnection.getResponseCode(Unknown Source)
at sun.plugin2.applet.Applet2ClassLoader.getBytes(Unknown Source)
at sun.plugin2.applet.Applet2ClassLoader.access$000(Unknown Source)
at sun.plugin2.applet.Applet2ClassLoader$1.run(Unknown Source)
at java.security.AccessController.doPrivileged(Native Method)
... 7 more
Exception: java.lang.ClassNotFoundException: AppletParamTest.class