CONFIDENTIAL TREATMENT REQUEST
* Portions denoted with an asterisk have been omitted and filed separately with
the Securities and Exchange Commission pursuant to a request for confidential
treatment.
EXHIBIT 10.26
Netgear and Furness Logistics Operating Agreement
DISTRIBUTION OPERATIONS AGREEMENT
Effective Date: April 27, 2001 Term: 2 year (with possible renewal periods)
This Distribution Operations Agreement ("Agreement") is entered into between
Netgear, Inc., a Delaware corporation ("Netgear"), and Furness Logistics, a
Dutch corporation, and is made as of the Effective Date for the Term. Subject to
the terms and conditions set forth in this Agreement, the parties have caused
this Agreement to be executed by their duly authorized representatives on the
date(s) shown below.
NETGEAR, INC.
Signature Xxxxxx X. Xxxxxxx Signature P. W A.M Mulders
------------------- ------------------------------
Printed Xxxxxx X. Xxxxxxx Printed P. W A.M Mulders
Title VP & CFO Title Operations Manager
Date APRIL 27, 2001 Date MAY 7, 2001
4500 Great America Parkway Trade Boulevard 4
P.O. Box 51815 476l RL Moerdijk (Zevenbergen)
Xxxxx Xxxxx, XX 00000 The Netherlands
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Netgear and Furness Logistics Operating Agreement
In consideration of their mutual representations, promises and obligations,
Netgear and Furness Logistics agree as follows:
1. SCOPE OF THE AGREEMENT
This Agreement sets forth the terms and conditions pursuant to which Furness
Logistics shall provide Netgear full Distribution Services (the "Services") as
listed below in a timely, competent and cost effective manner from the
Netherlands in support of the European sales region, all as more fully described
in the Statement of Work attached hereto as Exhibit 1:
- Receiving
- Inventory management
- Product fulfillment and logistics
- System transaction processing
- Return Materials processing
- Freight out transportation management services
- VAT Management
- Product Conversions & Repackaging
- Reporting
This Agreement contains those terms that shall pertain to Furness Logistics
Netherlands location. Furness Logistics will initially conduct all of it's
Netgear operations from the Netherlands.
2. DEFINITIONS
The following words and expressions shall have the meanings set forth
below:
"Affiliate" means, with respect to a party hereto, a corporation that
directly or indirectly controls, is controlled by, or is under common
control with, that party.
"Furness Logistics' Systems" means all software and systems used by
Furness Logistics in the performance of this Agreement, excluding any
software or systems provided to Furness Logistics by Netgear.
"Confidential Information" means a party's proprietary, confidential or
trade secret information.
"Customer" means a customer purchasing Netgear Products.
"Netgear Inventory Location" means the physical location (identified by
Furness Logistics) where Products will be staged prior to shipment to
Customers.
"Netgear Proprietary Information" means any information, technology,
processes, or other proprietary property, including copyrights, trade
secrets, know-how, mask work rights, moral rights, patents and/or
patent applications in any form or medium, developed or acquired by
Netgear or its licensors from the Production Effort.
"Order" shall mean any order for Products placed by a Customer in
accordance with the terms of this Agreement.
"Sun System" means Netgear's operating system used to manage receiving,
inventory control, pick, pack, ship and RMA activities.
"Conversions" means the process of unpacking, changing product
accessories and repacking products consistent to Netgear assembly
process instructions.
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Netgear and Furness Logistics Operating Agreement
3. BUSINESS MANAGEMENT PROCEDURES
3.1. METHODOLOGY
(a) Assign a account management teams whose goal is to provide consistent and
efficient responses to program requirements.
(b) Conduct quarterly business review of performance, cost and
continuous improvement opportunities
(c) Create a process to communicate about and resolve issues
promptly and to drive continuous improvement of the day-to-day
operation.
(d) Comply with reporting requirements as outlined in this
Agreement.
(e) Meet annually at the executive level to exchange business
strategies with the specific purpose of working to ensure that
each party's business goals can be met.
3.2 QUARTERLY REVIEWS
Furness Logistics and Netgear shall, in conjunction with each other, conduct
quarterly operations reviews of the business processes and procedures of both
Furness Logistics and Netgear with the intent to improve overall distribution
services performance. The review shall include, at a minimum, performance
measurements of quality, delivery, customer satisfaction, cost model review,
transportation cost review and update, capacity and innovations. Staff
allocation, and the plan to meet future requirements in these areas, shall be
reviewed.
The quarterly reviews shall be held in person at a Netgear's facility and
Furness Logistics agrees to comply at its own cost.
3.3 TARGET COST REDUCTION
Furness Logistics agrees to participate in periodic cost reviews with the intent
to reduce the costs of the operation to include transportation, transaction
processing and distribution services where applicable. Such reviews shall be
held in person at a Netgear facility and Furness Logistics agrees to comply at
its own cost.
3.4 LOCATION OF FURNESS LOGISTICS OPERATIONS
Furness Logistics shall initially perform the Services for all Distribution
Services from its facility in the Netherlands. Any deviation from this policy
must be authorized by Netgear in writing. Furness Logistics will not relocate
Netgear inventory without the written approval of Netgear.
3.5 FORECASTS OF EXPECTED RECEIPTS AND SHIPMENTS
Netgear shall deliver to Furness Logistics with a non-binding, rolling, forecast
covering a period of four months beyond the Build Plan ("Forecast"). Each
Forecast shall be a good faith estimate of the anticipated requirements for the
Product(s) anticipated to ship listed for the periods indicated.
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Netgear and Furness Logistics Operating Agreement
4 PRICES
4.1 PRICES FOR SERVICES
The price for Services shall be as set forth on the price list attached hereto
as Exhibit 3 (the "Price List"). Furness Logistics and Netgear agree that the
price includes all service cost and the Furness Logistics service fee. Furness
Logistics service fee generally includes all overheads, allocations, services
and profits, Furness Logistics agrees to provide a breakdown of actual cost for
each Service in final form on or before Monday of week ten in each quarter to
meet Netgear's standards setting calendar requirements. Transportation services
pricing is also attached hereto as part of Exhibit 3.
4.2 CURRENCY EXCHANGE RATE
All prices shall be in US$ at the agreed to exchange rate of [*]
5 ORDER FULFILLMENT AND PAYMENT
5.1. ORDER FULFILLMENT AND RETURNS
Netgear's Operations Centers in the U.S. will handle all of Netgear's Order
Administration functions. Furness Logistics will be responsible for fulfilling
orders including the preparation of all shipping documents and coordination with
a common carrier.
5.2. PAYMENT
All amounts shall be calculated in US Dollars. Payment terms are net 30 days.
Invoice for services to be submitted on a monthly basis to Netgear.
5.3. TAXES AND DUTIES
Netgear will pay as a separate item on an invoice any tax lawfully imposed on
the sale of the Products or on the provision of Services to Netgear or will
provide Furness Logistics with a certificate of exemption acceptable to the
appropriate taxing authority. Furness Logistics agrees to provide reasonable
assistance without charge in any proceeding for the refund or abatement of any
such taxes Netgear is required to pay. Without limiting the generality of the
foregoing, Netgear shall have no obligation to pay taxes based upon Furness
Logistics net income.
5.4. TITLE AND RISK OF LOSS AND SHIPMENT
Title to the Products will remain with Netgear in accordance to the terms of
sale and delivery to Netgear's customer. Prior to title passing, Furness
Logistics shall bear risk of all loss, damage or theft while in the care,
custody and control of Furness Logistics. Shipping instructions shall be
specified and Netgear will designate default shipping instructions. Furness
Logistics will provide proof of shipment upon request and will provide
reasonable assistance to Netgear at no charge in any claim it may make against a
carrier or insurer for misdelivery, loss or damage to Products.
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Netgear and Furness Logistics Operating Agreement
5.5 FISCAL REPRESENTATION
'Foreign principals', meaning not domiciled or resident in the Netherlands, are
offered the possibility to have themselves represented by Furness as limited
fiscal representative for the levy of Dutch VAT as regards the monthly
declaration of VAT and other administrative obligations such as the so-called
VAT listing, By appointing Furness, the individual registration of the foreign
entrepreneur in the Netherlands therefore has become superfluous.
In that case Furness acts on behalf of its principal both for the import of
goods and the ensuing delivery of those goods i.e. the onward delivery of goods
to customers in the European Union. Under this arrangement payments of VAT are
shifted to the EU customers.
After receipt of a legally undersigned Power of Attorney, Furness will confirm
the appointment on behalf of Netgear Inc.
6 INVENTORY MANAGEMENT
Products will be received into the Netgear Inventory Location using purchase
order receipts on Netgear's SunSystem. Furness Logistics will maintain a full
warehouse management system of it's own to control inventory to ensure back to
back accuracy with Netgear's Sun System.
All products will require a cycle count be completed on a weekly basis.
Products returned from Netgear Customers will be initially received into the
Netgear Inventory Location using the Sales Order Return transaction in
SunSystem, Furness Logistics will have the responsibility to verify contents,
receive, transact and report all customer product returns.
Lost or damaged inventory while in the care, custody and control of Furness
Logistics will be charged to Furness Logistics at the Netgear full inventory
standard cost of that inventory as substantiated by Netgear's Sun System at the
time the actual loss or damage took place. Furness Logistics will have access to
Netgear inventory standard cost.
7 TERM AND TERMINATION
7.1.1 TERM
This Agreement will commence on the Effective Date and continue for a period of
two years. Unless terminated earlier pursuant to the terms of this Agreement,
this Agreement will automatically renew for successive one-year periods upon
expiration of the term of this Agreement. Either party can terminate the
agreement upon at least 120 days notice prior to the end of the initial two
years or any one year renewal thereof.
7.2 TERMINATION
A party shall be in default under this Agreement if it:
(a) ceases conducting business in the normal course, makes a general
assignment for the benefit of creditors, suffers or permits the
appointment of a receiver for its business or assets, or becomes
subject to any proceeding under any statute of any governing authority
relating to insolvency or the protection of rights of creditors; or
(b) fails to perform any material obligation required to be performed by it
under this Agreement for a period of 30 days after receipt of written
notice by the other party of such failure.
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Netgear and Furness Logistics Operating Agreement
In such event, the non-defaulting party shall have the right to terminate this
Agreement immediately by giving written notice to the other.
(c) Netgear shall have the right to terminate this agreement for
convenience upon serving a 60 day written notice to the other party. Furness
Logistics shall have the right to terminate for convenience upon providing a 120
day notice to Netgear.
7.3. EFFECT OF EXPIRATION OR TERMINATION
Upon expiration or any termination of this Agreement by either party:
(a) Netgear shall pay all undisputed amounts or charges owed to Furness
Logistics as provided in this Agreement, provided that Netgear shall have the
right to set-off any such amounts or charges owed to Furness Logistics against
any amounts owing to Netgear by Furness Logistics pursuant to this Agreement. If
the aggregate amount owing by Netgear to Furness Logistics is less than the
aggregate amounts owing by Furness Logistics to Netgear. Furness Logistics shall
pay such net amount owing to Netgear promptly and in full within forty-five days
of the date which is the earliest of expiration or termination, as the case may
be.
(b) The provisions of this Agreement relating to Confidential and
Proprietary Information (Section 8),. Warranties (Section 10), Indemnification
(Section 11) and Section 14.1, shall remain in effect beyond any expiration or
termination.
(d) Furness Logistics shall return all Netgear Proprietary Information, and
under Netgear's supervision, destroy or erase all copies of such Netgear
Proprietary Information in the possession of Furness Logistics or any of its
Affiliates or their respective employees, consultants, agents or
representatives, including copies on paper or other hard copy and copies on
computer or other storage media.
7.4. DUTY TO FULFILL
Notwithstanding any termination or expiration of this Agreement, Furness
Logistics agrees to manage all inventory control functions and to fulfill all
Orders placed prior to the date of expiration or termination in accordance with
the terms of this Agreement if such Orders have not previously been cancelled.
8. CONFIDENTIAL AND PROPRIETARY INFORMATION
8.1 PROTECTION OF INFORMATION
During the term of this Agreement, the parties anticipate that each shall
disclose to the other in connection with this Agreement certain of its
Confidential Information. The recipient shall protect the disclosed Confidential
Information by using the same degree of care to prevent the unauthorized use,
dissemination, or publication of the Confidential Information as the recipient
uses to protect its own confidential information of a like nature, but no less
than a reasonable degree of care. Recipient's duty to protect the Confidential
Information disclosed under this Agreement shall expire three years from the
expiration or termination of this Agreement, except that source code shall be
protected hereunder indefinitely. Except as permitted by this Agreement, the
recipient shall disclose no part of such Confidential Information to anyone
except to those of its employees or contractors who have (i) a need to know the
same to accomplish the purposes of this Agreement, (ii) signed an Agreement
under which they shall keep confidential such Confidential Information (iii)
before receiving access to the Confidential Information, acknowledged its
confidential, proprietary and trade secret nature, (iv) agreed to use such
Confidential Information only for the purposes of performing recipient's
obligations under this Agreement. The terms of this Agreement may also be
disclosed to directors, officers, employees, attorneys, accountants,
contractors, banks or actual or potential financing sources of recipient, but
only if and to the extent such persons need to know the information for the
performance of their duties and are subject to confidentiality agreements or
fiduciary duties of confidentiality to recipient and agree to use such
information only for such duties.
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This Agreement imposes no restriction upon the recipient with respect to
disclosure or use of information: (a) that was in the recipient's possession
before receipt from the discloser; (b) that is or becomes (prior to such
disclosure or use) a matter of public knowledge through no fault of the
recipient; (c) that is received by the recipient from a third party without a
duty of confidentiality; (d) that is disclosed by the discloser to a third party
without a duty of confidentiality on the third party; (e) is independently
developed by the recipient; (e) to the extent disclosed in accordance with the
order or requirement of a court, administrative agency, or other governmental
body (provided, however, that the receiver shall provide prompt notice thereof
to enable the discloser to seek a protective order or otherwise prevent such
disclosure); or (f) that is disclosed by the recipient with the discloser's
prior written approval; or (g) as required by the federal securities law and
rules and regulations thereunder.
8.2 PUBLICITY
All press releases and printed material using the name, logo or other
identifying characteristics of a party shall be subject to prior approval of the
other party.
8.3 CONFIDENTIALITY
Each party agrees that the price of services negotiated by it and provided to
the other party shall be deemed to be Confidential Information of that party.
Each party agrees not to discuss the origins of such information with any third
party. Each party agrees not to use such information to solicit a discount from
the disclosing supplier, from any of the supplier's competitors or from any
other supplier for use by the recipient other than for the purposes of
performing its obligations under this Agreement. Each party acknowledges that
unauthorized disclosure of such information may irreparably damage the
discloser's relationship with its suppliers and that any benefit accruing to the
recipient shall belong to Netgear and/or the disclosing party.
8.4 INJUNCTIVE RELIEF
Each party acknowledges that damage from improper disclosure of Confidential
Information is irreparable and that it would be extremely impracticable to
measure the resulting damages. Accordingly, in addition to any other rights and
remedies that a party may have, the injured party is entitled to equitable
review, including preliminary and permanent injunction, and the other party
expressly waives the defense that a remedy in damages will be adequate.
8.5 RETURN OF CONFIDENTIAL INFORMATION
If this Agreement is terminated, and upon request of the discloser, the
recipient shall promptly return all Confidential Information received from the
discloser, together with all copies, or if requested by the discloser, certify
that all such Confidential Information has been destroyed.
9.0 CAPITAL ASSETS
In order to perform the testing, rework, conversions and repackaging that may be
required as stipulated in the Specific Services Addendum, Furness Logistics may
have to use certain capital equipment specified by Netgear. If Furness Logistics
can use the equipment for current or future applications other than for Netgear
assemblies, this equipment shall be the property of Furness Logistics and shall
be funded as such. If the capital equipment cannot be used by other non-Netgear
applications, such equipment shall be solely the property of Netgear and shall
have Netgear asset tags affixed to the equipment. Such property shall be funded
by Netgear.
Furness Logistics shall maintain inventory of all capital assets, regardless of
ownership, and shall provide inventory records to Netgear on demand. Inventory
records should include, but not be limited to, date of acquisition, description
of asset, serial number, and location.
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Netgear and Furness Logistics Operating Agreement
10. WARRANTIES
10.1. SERVICES
Furness Logistics warrants that all Services performed under this Agreement will
be performed in a competent, professional manner and in accordance with the
Statement of Work and the applicable Services under this Agreement.
10.2. LIMITATIONS
THIS CLAUSE 10.2 SETS OUT THE FURNESS LOGISTICS SOLE OBLIGATION AND LIABILITY,
AND NETGEAR'S EXCLUSIVE REMEDIES, FOR CLAIMS BASED ON SERVICE OR THE SUBJECT
MATTER OF ANY SERVICE AND REPLACES ALL OTHER WARRANTIES AND CONDITIONS, EXPRESS
OR IMPLIED, INCLUDING BUT NOT LIMITED TO IMPLIED WARRANTIES OR CONDITIONS OF
MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE PROVIDED ALWAYS THAT THE
FURNESS LOGISTICS DOES NOT EXCLUDE OR LIMIT ITS LIABILITY FOR DEATH OR PERSONAL
INJURY RESULTING FROM ITS NEGLIGENCE NOR LIABILITY FOR BREACH OF ANY TERM
IMPLIED BY STATUTE TO THE EXTENT THAT SUCH LIABILITIES CANNOT BY LAW BE LIMITED
OR EXCLUDED.
11. INDEMNIFICATION
11.1. INDEMNIFICATION BY NETGEAR
Netgear will, at its expense and at Furness Logistics request, defend any claim
or action brought against Furness Logistics by a third party (i) to the extent
that it is based on a claim that any Specification provided under this Agreement
infringes or violates any patent, copyright, trademark, trade secret or other
proprietary right of the third party or (ii) to the extent caused by any grossly
negligent act or omission or willful misconduct of Netgear; and Netgear will
indemnify and hold Furness Logistics harmless from and against any costs and
liability reasonably incurred by Furness Logistics that are attributable to that
claim, subject to compliance with the notice provisions below.
Netgear shall have no liability if the alleged infringement is the result of
Furness Logistics modification or alteration of the Specification; or Netgear's
compliance with Furness Logistics specifications, designs, or processes; or if
Furness Logistics had actual notice that use of such Specification or its
incorporation into a product would cause such infringement; provided, however,
that if Furness Logistics has such actual notice and promptly informs Netgear of
such actual notice. Furness Logistics shall not be liable for failure to deliver
Products hereunder, but only to the extent that such failure is a result of such
actual notice.
11.2. INDEMNIFICATION BY FURNESS LOGISTICS
Furness Logistics will, at its expense end at Netgear's request, defend any
claim or action brought against Netgear by a third party to the extent caused by
any negligent act or omission or willful misconduct of Furness Logistics or its
Affiliates: and Furness Logistics will indemnify and hold Netgear harmless from
and against any costs and liability reasonably incurred by Netgear that ore
attributable to that claim, subject to compliance with the notice provisions
below.
11.3. PROCEDURE FOR INDEMNIFICATION
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If any claim or action shall be brought or asserted against an indemnified party
as provided above (the "Indemnified Party") in respect of which indemnity may be
sought from an indemnifying party under such Sections (the "Indemnifying Party")
the Indemnified Party shall promptly notify the Indemnifying Party who shall
assume the defense thereof and the payment of all expenses; except that any
delay or failure to so notify the Indemnifying Party shall only relieve the
indemnifying Party of its obligations hereunder to the extent, if at all, that
it is prejudiced by reason of such delay or failure. The Indemnified Party shall
have the right to employ separate counsel in any such claim or action and
participate in the defense thereof, but the fee and expenses of such counsel
shall be at the expense of the Indemnified Party, unless (i) the employment
thereof shall have been specifically directed and required by the Indemnifying
Party or (ii) the Indemnifying Party shall have elected not to assume the
defense and employ counsel. Without the consent of the Indemnified Party, the
Indemnifying Party shall have no right to settle or compromise on any
non-monetary matter.
11.4. LIMITATION OF LIABILITY
EXCEPT FOR BREACHES OF OBLIGATIONS UNDER SECTION (8) OF THIS AGREEMENT
(CONFIDENTIAL AND PROPRIETARY INFORMATION) AND OBLIGATIONS UNDER SECTION 11
(INDEMNIFICATION), TO THE MAXIMUM EXTENT PERMITTED BY LAW, UNDER NO
CIRCUMSTANCES AND UNDER NO LEGAL THEORY, TORT, CONTRACT, OR OTHERWISE, SHALL
NETGEAR BE LIABLE TO SUPPLIER OR ANY OTHER PERSON FOR ANY INDIRECT (INCLUDING
BUT NOT LIMITED TO LOST PROFITS), SPECIAL, INCIDENTAL OR CONSEQUENTIAL DAMAGES,
EVEN IF NETGEAR SHALL HAVE BEEN INFORMED OF THE POSSIBILITY OF SUCH DAMAGES, OR
FOR ANY CLAIM BY ANY OTHER PERSON.
EXCEPT FOR BREACHES OF OBLIGATIONS UNDER SECTION (8) OF THIS AGREEMENT
(CONFIDENTIAL AND PROPRIETARY INFORMATION) AND OBLIGATIONS UNDER SECTION 11
(INDEMNIFICATION), TO THE MAXIMUM EXTENT PERMITTED BY LAW, UNDER NO
CIRCUMSTANCES AND UNDER NO LEGAL THEORY, TORT, CONTRACT, OR OTHERWISE, SHALL
FURNESS LOGISTICS BE LIABLE TO NETGEAR OR ANY OTHER PERSON FOR ANY INDIRECT
(INCLUDING BUT NOT LIMITED TO LOST PROFITS), SPECIAL. INCIDENTAL OR
CONSEQUENTIAL DAMAGES, EVEN IF SUPPLIER SHALL HAVE BEEN INFORMED OF THE
POSSIBILITY OF SUCH DAMAGES, OR FOR ANY CLAIM BY ANY OTHER PERSON.
12. GENERAL PROVISIONS
12.1. ACCESS TO FACILITIES
Netgear shall have the right to review and audit Furness Logistics facilities,
operations, and procedures at any reasonable time with reasonable notice for
purposes of determining compliance with the requirements of this Agreement. From
time to time Netgear's Customers will request the right to review Furness
Logistics facilities and operations for the purpose of qualification. Furness
Logistics agrees to permit such Customer surveys with five to ten working days
notice, provided Furness Logistics does not consider such Customer of Netgear to
be a competitor of Furness Logistics or one of Furness Logistics customers.
12.2. FORCE MAJEURE
"Force Majeure" shall include all acts or events beyond the control of a party,
including but not limited to acts of God, government restrictions, continuing
domestic or international problems such as wars or insurrections, strikes,
fires, floods, work stoppages, and embargoes, which prevent totally or partially
the fulfillment of the obligations of either party.
A party affected by an event of Force Majeure shall be released without any
liability on its part from the performance of its obligations (other than an
obligation to pay money) under this Agreement and the applicable Site
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Agreement, if any, but only to the extent and only for the period that its
performance of such obligations is prevented by circumstances of Force Majeure
and provided that such party shall have given prompt notice to the other party.
Such notice shall include a description of the nature of the event of Force
Majeure, its cause, and its possible consequences. The party claiming
circumstances of Force Majeure shall promptly notify the other party of the
conclusion of the event. The period of Force Majeure shall be deemed to commence
on the date that the event of Force Majeure first occurs. Regardless of the
excuse of Force Majeure, if either party is not able to perform within ninety
(90) days after such event, the other party may terminate the Agreement.
Termination of this Agreement shall not affect the obligations of either party
which exist as of the date of termination.
During the period that the performance by one of the parties of its obligations
under this Agreement or a Site Agreement has been suspended by an event of Force
Majeure, the other party may likewise suspend the performance of all or part of
its obligations under this Agreement.
13. NOTICES
All notices shall be sent by certified mail, postage prepaid, by personal
delivery, courier service, or by facsimile or other form of recorded
communication to the parties at their respective addresses set forth below. Any
notices given shall be deemed to have been received as follows: if sent by
facsimile or other form of recorded communication, when transmitted; if sent by
certified mail, on the date of delivery as shown on the return receipt; and if
by courier service, on the date delivered. Either party may change its notice
address by written notice to the other.
If to Furness Logistics: If to Netgear:
Trade Boulevard 4 Netgear, Inc.
4761 RL Moerdijk 0000 Xxxxx Xxxxxxx Xxxxxxx
Xxx Xxxxxxxxxxx Xxxxx Xxxxx, XX 00000-0000
Attention:
With a copy to CFO at the same address
14.1. EXPORTS AND CUSTOMS
Each party agrees that it will not knowingly (i) export or re-export, directly
or indirectly, any technical data (as defined by the U.S. Export Administration
Regulations), including software received from the other under this Agreement or
(ii) export or re-export, directly or indirectly, any direct product of such
technical data, including software, to any destination to which such export or
re-export is restricted or prohibited by U.S., or applicable non-U.S. law
without obtaining prior authorization from the U.S. Department of Commerce
and/or other competent government authorities to the extent required by those
laws. This clause shall survive termination or cancellation of this Agreement.
Unless otherwise set forth in this Agreement, Furness Logistics shall take all
administrative actions required to produce customs invoices and country of
origin documents for all shipments crossing international borders which comply
with all laws, treaties and regulations of both the exporting country and the
importing country. If a Product includes Materials having different countries of
origin, the different countries of origin must be identified on the customs
invoices, along with the related quantities/serial numbers of such Materials.
Furness Logistics shall be solely responsible for all fines, penalties and costs
resulting from a customs invoice not being so compliant.
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Furness Logistics shall perform all administrative actions required to determine
the eligibility of each Product for preferential treatment under the rules of
any applicable trade treaties/agreements and, if eligible, provide the necessary
documentation and obtain such preferential treatment. Furness Logistics shall
use it's best efforts to minimize any penalties and costs resulting from any
such documents subsequently determined to be invalid, shall maintain all
documentation to support the eligibility and shall respond in a timely manner to
verification questionnaires or reviews.
14.2. AMENDMENT, MODIFICATION OR WAIVER
The provisions of this Agreement may be amended or waived only by an instrument
in writing signed by the authorized representatives of each party, except as
otherwise expressly provided in this Agreement.
14.3. DISASTER RECOVERY PLAN
Furness Logistics agrees to develop and maintain a disaster recovery plan to be
put into effect in the event that it becomes unable to fulfill Orders for any
reason for a period of more than 15 calendar days. The disaster recovery plan
shall be submitted by Furness Logistics to Netgear for review within 15 days of
the Effective Date of this Agreement, and shall be reviewed yearly thereafter.
Furness Logistics agrees that the disaster recovery plan must enable Furness
Logistics to continue to fulfill Orders in accordance with the time schedules
required under this Agreement.
14.5. INDEPENDENT CONTRACTOR
This Agreement shall not constitute Furness Logistics the agent or legal
representative of Netgear for any purpose and Furness Logistics shall not hold
itself out as an agent of Netgear other than as expressly provided in this
Agreement. This Agreement creates no relationship of joint venturers, partners,
associates, employment or principal and agent between the parties, and both
parties are acting as independent contractors. Neither party shall have the
right to exercise any control or direction over the operations, activities,
employees or agents of the other party in connection with this Agreement.
Furness Logistics is not granted any right or authority to, and shall not
attempt to, assume or create any obligation or responsibility for or on behalf
of Netgear. Furness Logistics shall not have any authority to bind Netgear to
any contract, whether of employment or otherwise, and Furness Logistics shall
bear all of its own expenses for its operations, including, without limitation,
the compensation of its employees and sales people and the maintenance of its
offices, service, warehouse and transportation facilities. Furness Logistics
shall be solely responsible for its own employees and sales people and for their
omissions, acts and the things done by them. Netgear expressly disclaims any
liability for any commitments on behalf of Netgear made by Furness Logistics.
14.6. FURNESS LOGISTICS RESPONSIBLE FOR ITS SUBCONTRACTORS
The acknowledgment by Netgear of any subcontractor of Furness Logistics shall in
no way be construed to relieve Furness Logistics of any of its duties,
responsibilities and obligations to Netgear under this Agreement.
14.7.1 NO ASSIGNMENT
Neither this Agreement nor any right or obligation under it shall be assigned or
delegated by Furness Logistics, voluntarily or by operation of law, without the
prior written consent of the other party, which consent may not be unreasonably
withheld. Any attempted Assignment shall be deemed voidable. An attempted
assignment shall be deemed to occur in the event of a sale or transfer of
substantially all of the assets of, or a majority interest in, the voting shares
to, or the merger or consolidation with or into, any other entity.
Netgear, Inc. CONFIDENTIAL INFORMATION Page 11
Netgear and Furness Logistics Operating Agreement
14.8. APPLICABLE LAW
All issues and questions concerning the construction, validity, enforcement,
interpretation and performance of this Agreement, the rights and obligations
arising hereunder and any purchase made hereunder shall be governed by the laws
of the State of California and the federal laws of the United States applicable
therein, without reference to the UNCITRAL Conventions on Contracts for the
International Sale of Goods and without giving effect to any choice of law or
conflict of law, rules or provisions (whether of California or any other
jurisdiction) that would cause the application of the laws of any jurisdiction
other than California. The parties hereto submit to and consent to the
nonexclusive jurisdiction of the courts located in the State of California.
14.9. RIGHTS CUMULATIVE
Except as otherwise expressly provided in this Agreement or in any Site
Agreement, all rights and remedies conferred by this Agreement, by any other
instrument, or by law are cumulative and may be exercised singularly or
concurrently.
14.10 SEVER ABILITY
If any one or more of the provisions of this Agreement for any reason shall be
held to be invalid, illegal, or unenforceable in any respect by any law or
regulation of any government or by any court, such provision shall not affect
any other provision, and this Agreement shall be construed as if such invalid,
illegal or unenforceable provision had never existed, except in those instances
where removal or elimination of such provision would result in a failure of
consideration under this Agreement.
14.11. ENTIRE AGREEMENT
This Agreement and each Site Agreement, including all Exhibits, constitutes the
entire Agreement between the parties pertaining to the subject matter of this
Agreement. This Agreement supersedes all prior agreements and understandings
between the parties, written or oral, with respect to such subject matter. No
representations or statements of any kind made by any representative of Netgear
which are not stated in this Agreement shall be binding on Netgear. No course of
dealing or course of performance shall be relevant to explain or supplement any
term expressed in this contract.
14.10 NO COLLATERAL
Furness Logistics will not attach, or cause liens to be attached to any of our
inventory, and that they will not use our inventory as collateral for any
purposes.
Netgear, Inc. CONFIDENTIAL INFORMATION Page 12
CONFIDENTIAL TREATMENT REQUEST
* Portions denoted with an asterisk have been omitted and filed separately with
the Securities and Exchange Commission pursuant to a request for confidential
treatment.
Netgear and Furness Logistics Operating Agreement
SPECIFIC SERVICES AND AGREEMENTS ADDENDUM
FINISHED GOODS
2.1 PROCESS OVERVIEW & ENVIRONMENT
The requirement is to receive, into a bonded warehouse, a regular receipt of
product, which has been manufactured in Asia. The product is to be stored,
controlled and accounted for and then picked to match specific customer order
requirements for mainland Europe (85% of the volume) and UK orders (15% of the
volume).
WAREHOUSES IN THE NETHERLANDS
In the Netherlands Furness operates 1.2 million sq ft modern warehouses at
Dordrecht, Moerdijk (both close to Rotterdam)and 's-Heerenberg (close to the
German border).
REAL TIME OPERATION
At all our warehouses the operation is real time. The product flow through the
warehouse is bar code controlled from handling-in till the loading of the truck.
Further we use RF equipment as result of which stock is updated immediately when
the goods are put on location and after the pick.
SECURITY SYSTEMS
We have video cameras throughout the warehouse monitoring all activities. The
tapes are kept for a period of 4 month. We have a burglar alarm throughout the
warehouse even in the walls connected with a security company and a fire alarm
system directly connected with the fire station.
BONDED WAREHOUSE
Like all our warehouses the warehouse is bonded. We have the license type E,
meaning that we can store bonded and non- bonded even together at the same
location. License E is a fictitious administrative system, which allows us to
ship 24 hours per day and only declare to customs once a month.
LEAD-TIME
Standard is that orders received before 1200 are ready for shipment the same
day.
Netgear, Inc. CONFIDENTIAL INFORMATION Page 13
Netgear and Furness Logistics Operating Agreement
2.2 RECEIPT
100 to 120 pallets per week, forecast to double over next 12 months. 95+% of
this volume is containerized sea freight. The receipts will be delivered
throughout the week. The remaining is by ad-hoc airfreight. All pallets are 120
x 120 x 120 plywood-shipping pallets.
The shipment is to be verified against the packing list and/or invoice, booked
into the storage location and all Sun System receipt transactions to be
completed on the day of delivery.
The majority of pallets received will contain single part numbers. Where a
pallet contains mixed part numbers it will be split down into an individual part
number per pallet.
Approximately 1 month's supply of product is held stock i.e. 800-1000 pallets,
covering approximately 250 part numbers. All products are to receive a weekly
physical stock check or cycle count.
Netgear has five primary stockroom locations within the Sun System; IQC, two
finished goods locations, stock rotation and warranty returns. Receipts must be
played into the correct location based on the specific type of transaction.
Furness Logistics will provide a safe and secure warehouse environment.
A product identification, not necessarily a bar code id, is sufficient to handle
incoming products. Trucks/containers arriving before 1600 hours will be off
loaded and the goods put on location the same day. This also applies for the
stock update.
After discharge the products will be sorted by SKU (stock keeping unit) and
checked on outer damage and quantity. The system will create a location and a
put away. For the storage of pallets we maintain a free storage system although
products of a customer are stored as much as possible together. For shelves and
bins we maintain a fixed storage location system. Depending whether the customer
maintain a strict FIFO system or not the incoming products will added to a
location containing the same product or a new location will created.
The person bringing the product on location will scan the put away and then the
location. If the scanner will tell him that he is at the right location he will
put the product on location and confirm this and through RF stock will be
updated.
Netgear, Inc. CONFIDENTIAL INFORMATION Page 14
Netgear and Furness Logistics Operating Agreement
2.3 ORDER PICKING
The current Netgear customer base is thirty-two. The average number of customer
orders per month is 200. The average number of lines per customer order is seven
(7). Orders are placed over night (in the US) and are visible by 7am at which
time an order requirement report (shippable backlog) is to be produced. The
majority of shipments (+95%) are in full case and pallet quantities, but there
are some shipments that require case breaks.
All orders are to be picked, made ready for dispatch and confirmed on the system
by 16:00 Europe time, with all stock being picked on a FIFO basis.
Weekly order volumes are expected 10 fluctuate by plus or minus 25% per week,
with the third week of the month seeing the highest volume.
The required service level is for all Customer orders to be dispatched from the
distribution hub within 48 hours of entering on Sun.
2.4 SHIPMENT QUALITY AND MIS-SHIPS
All packing list and commercial invoice are to be generated from the Sun System.
All shipments are to be audited to confirm 100% accuracy to Customer order and
packing / delivery specifications (which may vary from Customer to Customer).
Mis-shipments are shipments reported by Netgear's customer that do not contain
what the invoice declared. In this case, Netgear credits the customer and then
charges the Furness Logistics for the inventory standard cost of the missing
items. Upon review of the audit trail documentation, if the Furness Logistics
can prove to Netgear that it did infact ship what the invoice called for, and
then Netgear will reimburse the service provider for the mis-ship charge.
2.5 IMPORT/EXPORT CUSTOMS CLEARANCE AND VAT
Netgear will use it's own freight forwarder and customs broker to manage the
import of finished goods and raw materials from it's Asia trading partners to
the distribution center.
Furness Logistics will be responsible for completing all required export
documentation and complying with export formalities throughout the European
continent.
Furness Logistics agrees to provide VAT Management Services to Netgear and the
cost of such services has been factored into the proposed cost and cost model
agreement. Another administrative obligation Furness has to fulfil on behalf of
Netgear Inc. is the filing and reporting of all Intra EU-transactions.
Declarations have to be sent to the Central Bureau of Statistics. The commercial
invoices mentioned under Customs are also used to meet these requirements
Netgear, Inc. CONFIDENTIAL INFORMATION Page 15
Netgear and Furness Logistics Operating Agreement
2.6 TRANSACTION PROCESSING
All receipts & picks/dispatches are to be transacted daily on Netgear's Sun
System. The service provider will be expected to provide and maintain a full
warehouse management system to control the inventory held and to ensure "back to
back" accuracy with Netgear's Sun System.
Furness Logistics will provide two administrative resources to play all receipt
and shipment transactions in the Sun System on a daily basis.
2.7 TRANSPORTATION
All import transportation costs will be paid for and managed by Netgear Inc.
Furness Logistics will provide freight out transportation services to Netgear
customers. All outbound transportation costs will be paid for by Furness
Logistics and then invoiced to Netgear at the agreed to rate schedule attached
to this document. Transportation cost are over and above the agreed to cost
model for distribution services.
2.8 RMA (RETURN MATERIAL AUTHORIZATION) PROCESSING
Currently, approximately 31 RMA Orders per month of "faulty" product are
returned to the distribution hub from Netgear Customers. This represents 408
line items and 3200 units per month. This is audited against RMA information in
SUN and transacted to allow credits to be issued to Netgear Customers. A
nominated carrier then returns the product to Hong Kong.
The cost to receive, inventory, report, stage and ship RMA's has been included
in the cost plus model.
2.9 ADDITIONAL ACTIVITIES
RMA TEST & REPACK:
The intention is to introduce a screening process for RMA returns, with No Fault
Found units being returned to stock and faulty units being sent for replacement
or repair. Often the RMA units will require repackaging into a new "gift" or
retail carton. Netgear will be responsible for supplying any test
specifications, equipment, packaging, materials and training.
The cost to test and repackage product will be negotiated at a later date on a
cost per unit basis.
CONVERSION:
This is an activity, which will involve the re-packing of product and the
addition of specific items such as manuals or a change in power cords, or a
change in retail packaging etc. The repacked item would be assigned a different
pan number.
The cost of managing conversions will be negotiated at a later date on a cost
per unit basis.
Netgear, Inc. CONFIDENTIAL INFORMATION Page 16
Netgear and Furness Logistics Operating Agreement
2.10 COST PLUS MODEL
Netgear intends to manage the European distribution center on a cost-plus model
basis. Freight charges are to be excluded from the cost model and will be
managed separately. The cost of RMA Test, Repackaging and Conversion will also
be excluded from the cost model.
2.11 REPORTING:
Netgear will be provided with direct access to service Furness Logistics systems
limited to Netgear account information. This would be via web access or modern
access. This would include access to on-hand inventory, receipts, shipments,
RMA's etc. Netgear will also be allowed to run any standard or custom reports
available to Netgear for comparison to Netgear's Sun System database. Furness
Logistics will provide Netgear with daily access to web site and account
activity. Furness Logistics will provide Netgear with mutually agreed to set of
standard reports on a daily, weekly and/or monthly basis as required.
2.12 PERFORMANCE INDICATORS
Inbound flows
The time for handling in and stock up date is depending on the number of SKU in
the incoming container. Standard is that product is handled in the stock updated
the day of arrival. The lead time measured through scanning.
Warehousing
Furness Logistics accepts an inventory accuracy of [*] and accept full
responsibility for missing goods. Measurement method: cycle count.
Order picking
Standard is that orders received before noon are ready for shipment the same
day. Depending on the number of orders and lines to be shipped an agreement has
to be reach on the percentage of orders to be received over night. Measurement
method the system will tell when an order is ready for shipment.
Order correctness
99.85 % of the order lines picked under the condition that the content of the
cartons in stock is correct.
Administrative
% of reported non-conformities per day [*]
Distribution
Furness Logistics do not accept direct liability for on time deliveries as
delivery is subcontracted. However the carriers used offer a [*] on- time
delivery but do not guarantee same.
Netgear, Inc. CONFIDENTIAL INFORMATION Page 17
Netgear and Furness Logistics Operating Agreement
3.0 SUMMARY
Netgear will provide its own marine and property insurance to cover fires,
flood, and other acts of god. Furness Logistics will be insured at it's own
cost for workers compensation and losses and damages caused by Furness
Logistics negligence.
Furness Logistics will not charge Netgear start up cost. In case a system
interface has to be built it is agreed that each party bears its own cost.
Netgear can use Furness VAT and deferment account for the duration of the
relationship.
Furness Logistics agrees to provide Netgear with web-based access to account
information.
Furness Logistics accepts [*] responsibility for inventory discrepancies from
the time of receipt to the time of shipment, or while in the care, custody and
control of Furness Logistics.
Furness Logistics agrees to have Netgear Sun System installed at our site and we
will process transactions according to Netgear requirements.
Furness Logistics agrees to a cost plus model pricing with a quarterly review.
All inventories will remain the property of the Netgear. The service provider
will be financially liable for any and all inventory variances while the
inventory is in the care, custody and control of the Furness Logistics.
Reimbursement for unexplained variance will be at the full inventory standard
cost reflected on Netgear's books.
Furness Logistics will designate a Netgear Account Manager to address any/all
operational, business and continuous improvement plans with.
Furness Logistics will produce periodic performance, measurement and activity
reports.
A periodic management review (initially monthly leading to quarterly) will take
place between Netgear and the Furness Logistics to review specific agenda items
(to be mutually agreed).
Netgear, Inc. CONFIDENTIAL INFORMATION Page 18
CONFIDENTIAL TREATMENT REQUEST
* Portions denoted with an asterisk have been omitted and filed separately with
the Securities and Exchange Commission pursuant to a request for confidential
treatment.
Netgear and Furness Logistics Operating Agreement
PRICING TABLE
QUOTATION (BASED ON COST PLUS)
ANNUAL COST INDICATION
Inbound Euro [*]
Warehousing Euro [*]
Weekly inventory count Euro [*]
Outbound Euro [*]
Wrapping foil Euro [*]
One way pallets Euro P.M.
RMA Euro [*]
Customs/fiscal rep. Euro [*]
Account manager Euro [*]
Administrative support Euro [*]
Total Annual Cost to Netgear Euro [*]
MANAGEMENT FEE AND OVERHEAD INCLUDED IN TOTAL COST
12% on warehouse rent and equipment
20% on labor
Wrapping foil Euro 1,35
One way pallets Euro 5,00
Packaging material As per outlay
Labels as per outlay
Netgear, Inc. CONFIDENTIAL INFORMATION Page 19
Netgear and Furness Logistics Operating Agreement
TRANSPORTATION SERVICES
RATE USUAL TRANSIT TIME
DESTINATION EUR IN WORKABLE DAYS
-------------------------------------------------------
Germany 7.80 2 or 3
-------------------------------------------------------
France 12.00 3 or 4
-------------------------------------------------------
United Kingdom 12.00 3 or 4
-------------------------------------------------------
Austria 12.90 4 or 5
-------------------------------------------------------
Belgium 6.50 1 or 2
-------------------------------------------------------
Denmark 13.40 3 or 4
-------------------------------------------------------
Finland 33.30 6 or 7
-------------------------------------------------------
Italy 18.10 4 or 5
-------------------------------------------------------
Holland 5.80 1
-------------------------------------------------------
Norway 29.60* 5, 6 or 7
-------------------------------------------------------
Spain 27.00 4 or 5
-------------------------------------------------------
Sweden 18.60 4 or 5
-------------------------------------------------------
Switzerland 10.90* 5 or 6
-------------------------------------------------------
* Customs clearance not included
Netgear, Inc. CONFIDENTIAL INFORMATION Page 20
Netgear and Furness Logistics Operating Agreement
Netgear, Inc. CONFIDENTIAL INFORMATION Page 21
WEIGHT IN KG BELGIUM XXXX 0 XXXX 0 XXXX 0 XXXX 0 XXXX 5 XXXX 0 XXXX 0 XXXX 0 XXXX 9
ECX ECX ECX ECX WPX WPX WPX WPX WPX WPX
0.5 18.88 19.12 20.09 21.01 32.82 38.51 46.52 46.98 58.78 63.50
1.0 19.76 21.66 22.63 24.02 35.83 42.31 51.61 51.24 64.48 70.82
1.5 20.80 24.21 25.18 26.98 38.79 46.15 56.70 55.50 70.12 78.13
2.0 21.48 26.75 27.73 29.99 41.80 49.94 61.79 59.75 75.82 85.44
2.5 22.31 29.30 30.27 32.96 44.76 53.78 66.88 64.01 81.46 92.76
3.0 23.19 31.84 32.82 35.96 47.77 57.58 71.97 68.27 87.16 100.07
3.5 24.02 34.39 35.36 38.93 50.73 61.42 77.07 72.53 92.80 107.38
4.0 24.90 36.94 37.91 41.93 53.74 65.22 82.16 76.79 98.50 114.70
4.5 25.73 39.48 40.45 44.90 58.70 69.06 87.25 81.05 104.14 122.01
5.0 26.61 42.03 43.00 47.91 59.71 72.85 92.34 85.30 109.84 129.51
5.5 26.94 42.91 44.20 49.62 61.61 75.35 96.60 88.87 115.16 136.54
6.0 27.31 43.74 45.41 51.33 63.55 77.81 100.86 92.39 120.48 143.53
6.5 27.63 44.62 46.61 53.04 65.55 80.31 105.11 95.95 125.80 150.52
7.0 28.00 45.45 47.81 54.76 67.39 82.78 109.37 99.47 131.50 157.51
7.5 28.33 46.33 49.02 56.47 69.29 85.26 113.63 103.03 137.33 164.55
8.0 28.70 47.17 50.22 58.18 71.23 87.71 117.89 106.55 143.21 171.53
8.5 29.02 48.04 51.42 59.89 73.13 90.21 122.15 110.11 149.04 178.52
9.0 29.39 48.88 52.63 61.61 75.08 92.66 125.41 113.63 154.92 185.51
9.5 29.72 49.76 53.83 63.32 76.97 95.16 130.99 117.20 160.75 192.55
10.0 30.09 50.59 55.03 65.03 78.92 97.62 135.71 120.71 166.63 199.54
10.5 30.32 51.19 55.96 68.28 80.17 99.38 138.67 122.89 169.73 204.07
11.0 30.55 51.75 56.88 67.58 81.46 101.09 141.68 125.02 172.83 208.88
11.5 30.78 52.35 57.81 68.83 82.78 102.85 144.69 127.19 175.93 213.19
12.0 31.01 52.90 58.74 70.12 84.05 104.58 147.70 129.51 179.03 217.77
12.5 31.24 53.51 59.66 71.37 85.35 106.32 150.71 131.91 182.13 222.31
13.0 31.47 54.08 60.59 72.67 86.65 108.03 153.71 134.27 185.23 228.89
13.5 31.71 54.88 61.51 73.92 87.94 109.79 156.72 136.64 188.34 231.43
14.0 31.94 55.22 62.44 75.21 89.24 111.50 159.73 139.00 191.48 238.01
14.5 32.17 55.82 63.36 76.48 90.53 113.25 162.74 141.36 194.58 240.55
15.0 32.40 56.38 64.29 77.76 91.83 114.97 165.75 143.72 197.69 245.08
15.5 32.63 56.98 65.22 79.01 93.13 116.73 168.71 146.08 200.79 249.66
16.0 32.86 57.53 66.14 80.31 94.42 118.44 171.72 148.48 203.89 254.20
16.5 33.09 58.13 67.07 81.56 95.72 120.20 174.73 150.84 206.99 258.76
17.0 33.33 58.69 67.99 82.85 97.01 121.92 177.74 153.21 210.09 263.32
17.5 33.56 59.29 68.92 84.10 98.31 123.68 180.75 155.57 213.19 267.90
18.0 33.79 59.85 69.84 85.40 99.61 125.39 183.75 157.93 216.29 272.44
18.5 34.02 60.45 70.77 86.66 100.90 127.15 186.76 160.29 219.39 277.02
19.0 34.25 61.00 71.70 87.94 102.20 129.00 189.77 162.69 222.54 281.56
19.5 34.48 61.61 72.62 89.19 103.49 130.94 192.78 165.05 225.64 286.09
20.0 34.71 62.16 73.55 90.49 104.79 132.84 195.79 167.41 228.74 290.67
20.5 34.85 62.58 74.10 91.23 105.58 134.32 198.24 169.45 231.57 294.70
21.0 34.99 62.99 74.66 92.02 106.36 135.85 200.69 171.49 234.44 298.73
21.5 35.13 63.41 75.21 92.76 107.15 137.33 203.19 173.52 237.31 302.75
22.0 35.27 63.83 75.77 93.54 107.94 138.86 205.65 175.56 240.13 308.78
22.5 35.41 64.24 76.32 94.28 108.72 140.34 208.10 177.60 243.00 310.76
23.0 35.55 64.66 78.88 95.07 109.51 141.87 210.60 179.63 245.82 314.79
23.5 35.69 65.08 77.44 95.81 110.30 143.35 213.05 181.67 248.89 318.82
24.0 35.83 65.49 77.99 96.60 111.09 144.87 215.51 183.71 251.58 322.84
24.5 35.96 65.91 78.55 97.34 111.87 146.36 218.01 185.74 254.39 326.87
25.0 38.10 66.33 79.10 98.13 112.66 147.84 220.46 187.78 257.26 330.90
Addit. 0.5kg 25.5-50kg 0.15 0.43 0.61 0.84 0.87 1.50 2.47 2.04 2.85 4.02
Tariff 50 kg 43.05 86.00 108.87 137.19 154.45 222.96 343.95 289.61 399.81 532.01
Addit. 0.5kg 50.5-100kg 0.15 0.43 1.27 1.48 1.55 1.50 2.47 2.04 2.85 4.02
Tariff 75 kg 49.99 105.67 168.43 211.02 232.12 298.03 457.39 391.44 542.37 733.12
Tariff 100 kg 56.93 125.34 232.08 284.84 309.74 373.15 590.88 493.27 684.93 934.23
Addit. 0.5kg 100.5-200kg 0.20 0.43 1.17 1.43 1.55 1.50 2.47 2.04 2.85 4.02
Tariff 150 kg 75.45 168.43 349.18 427.40 485.03 523.35 837.82 696.92 970.05 1338.45
Tariff 200 kg 93.96 211.71 466.25 569.96 620.32 673.55 1084.75 900.58 1255.17 1738.87
Addit. 0.5kg >200 kg 0.25 0.51 1.27 1.43 1.55 2.34 3.64 3.11 5.19 6.49
Netgear, Inc. CONFIDENTIAL INFORMATION Page 22
Netgear and Furness Logistics Operating Agreement
Euro per shipment or per 0.5 kg excl. fuel surcharge
----------------------------------------------------------------------------------------------------------------------------------
DHL zone-indexing 2001
----------------------------------------------------------------------------------------------------------------------------------
Xxxxxxx 0 Xxxxxxx 8 Libya (???)
Xxxxxxx 0 Xxxxx 0 Xxxxxxxxxxxxx (???)
American Samoa 9 El Salvador 9 Lithuania (???)
Andorra 4 Equatorial Guinea 9 Luxembourg (???)
Angola 9 Eritrea 9 Macau (???)
Xxxxxxxx 0 Xxxxxxx 7 Macedonia (???)
Antigua 8 Ethiopia 9 Madagascar (???)
Argentina 8 Faroe Islands 9 Malawi (???)
Xxxxxxx 0 Xxxx 0 Xxxxxxxx (???)
Aruba 6 Finland 3 Maldives (???)
Australia 6 France 1/2 Mali (???)
Austria 3 French Guiana 8 Malta (???)
Xxxxxxxxxx 0 Xxxxx 0 Xxxxxxxx Xxxxxxx (???)
Xxxxxxx 0 Xxxxxx 9 Martinique (???)
Bahrain 6 Georgia 7 Mauritania (???)
Xxxxxxxxxx 0 Xxxxxxx 1/2 Mauritius (???)
Xxxxxxxx 0 Xxxxx 0 Xxxxxx (???)
Xxxxxxx 0 Xxxxxxxxx 0 Xxxxxxx, Xxxxxxxx of (???)
Xxxxxxx 0 Xxxxxx 3 Monaco (???)
Belize 9 Greenland 9 Mongolia (???)
Xxxxx 0 Xxxxxxx 0 Xxxxxxxxxx (???)
Xxxxxxx 0 Xxxxxxxxxx 0 Xxxxxxx (???)
Bhutan 9 Guam 9 Mozambique (???)
Xxxxxxx 0 Xxxxxxxxx 0 Xxxxxxx (???)
Bonaire 6 Guernsey 4 Namibia (???)
Bosnia & Xxxxxxxxxxx 0 Xxxxxx Xxxxxxxx 0 Xxxxx, Xxxxxxxx of (???)
Xxxxxxxx 0 Xxxxxx Xxxxxx 0 Xxxxx (???)
Brazil 8 Guyana (British) 8 Nevis (???)
Xxxxxx 0 Xxxxx 0 Xxx Xxxxxxxxx (???)
Xxxxxxxx 0 Xxxxxxxx (Xxxxxxxx) 9 New Zealand (???)
Xxxxxxx Xxxx 0 Xxxx Xxxx 0 Xxxxxxxxx (???)
Burundi 9 Hungary 7 Niger (???)
Cambodia 9 Iceland 4 Nigeria (???)
Cameroon 9 India 6 Niue (???)
Canada 5 Xxxxxxxxx 0 Xxxxxx 4
Canary Islands 4 Iran 0 Xxxx 0
Xxxx Xxxxx 0 Xxxxxxx, Xxxxxxxx of 3 Pakistan 8
Xxxxxx Xxxxxxx 0 Xxxxxx 0 Xxxxxx 0
Xxxx 0 Xxxxx 2/3 Papua New Guinea 9
Xxxxx 0 Xxxxx Xxxxx 0 Xxxxxxxx 0
Xxxxx People's Republic 8 Jamaica 9 Xxxx 0
Xxxxxxxx 0 Xxxxx 6 Philippines, The 6
Netgear, Inc. CONFIDENTIAL INFORMATION Page 23
Netgear and Furness Logistics Operating Agreement
Comores 9 Jersey 4 Poland
Congo 9 Jordan 8 Portugal
Xxxx Islands 9 KazaKhstan 7 Puerto Rico
Xxxxx Xxxx 0 Xxxxx 0 Xxxxx
Xxxxxxx 7 Kiribati 9 Reunion Island of
Xxxx 0 Xxxxx, Xxxxxxxx of 6 Romania
Curacao 6 Kuwait 6 Russian Federation, The
Cyprus 6 Xxxxxxxxxx 0 Xxxxxx
Xxxxx Xxxxxxxx. The 7 Laos 9 Saipan
Xxxxxxx 0 Xxxxxx 7 San Marino
Djibouti 9 Lebanon 9 Sao Tome & Xxxxxxxx
Xxxxxxxx 0 Xxxxxxx 0 Xxxxx Xxxxxx
Xxxxxxxxx Xxxxxxxx 0 Xxxxxxx 0
XXXXXXX (*)
ZONE 1 NORTH AND WEST
Service Centers: Bremen (BRE). Cologne (CGN), Dortmund (DTM), Duesseldorf (DUS), Frankfurt (FRA), Hannover (HAJ), Hamburg
(HAM)
Postal codes: 20000-38999 40000-54599 (???)4700-65936
ZONE 0 XXXX XXX XXXXX
Xxxxxxx Xxxxxxx: Xxxxx (XXX), Xxxxxxxx (XXX), Karlsruhe (OKA), Leipzig (LEJ), Mannheim (MHN), Munich (MUC), Nuemberg
(NUE), Stuttgart (STR
Postal codes: 01000-19999 39000-39999 84600-64699 66000-99999
FRANCE (*)
ZONE 1 NORTH
Service Centers: Paris (CDG), La Havre (LEH), Lille (LIL), Xxxx (MZM). Orleans (ORE)
Postal codes: 02... 08... 10... 14... 18... 27... -28... 36... -37... 41... 45... 50... -52... 54... -55... 57... -62...
72... 75... -78... 80... 88... -89... 91...
EAST, WEST AND
ZONE 2 SOUTH
Service Centers: Bordeaux (BOD), Lyon (LYS), Marseille (MRS), Mulhouee (MLH), Nantes (NTE), Nice (NCE), Strasbourg (SXB),
Toulouse (TLS)
Postal codes: 01... 03... 04... -07... 09... 11... -13... 15... -17... 19... -28... 29... -35... 38...
-40... 42... -44... 46... -49... 53... 56... 63... -71...
79... 81... -87... 90... 98...
UNITED KINGDOM (*)
XXXX 0 XXXXXXX/XXXXX
Service Centers: Birmingham (BHX), Bristol (BRS), Cambridge (CBG), East Midlands (EMA), Leeds (LBA), london-GatwicK (LOW),
London Heathro Liverpool (LPL), Manchester (MAN), Teesslda (MME), Newcastle (NCL), Reading (RED), Southampton
(SOU), Swindon (SWN)
Postal codes: AL..-BS.. CA..-DA.. DE.. DH.. -EC.. EN.. EX.. FY.. GL... -MR.. MU..-IG.. IP.. KT.. L..-MK.. N.. -OX..
PE.. PL.. -TA.. XX
XXXX 0 XXXXXXXX/XXXXXXXX XXXXXXX
Service Centers: Aberdeen (ABZ), Belfast (BFS), Edinburgh (EDI), Glasgow (GLA), Inverness (INV), Isle of Man (IOM)
Postal codes: AB.. BT.. DD.. DO.. EH.. FK.. G.. HS.. IM.. IV.. KA.. KW.. KY.. ML.. PA.. PH..
TD.. ZE..
ITALY (**)
ZONE 2 NORTH
Service Centers: Ancona (AOI), Bergamo (BQY), Bologna (BLQ), Brescia (QBS), Xxxxxxxx (FLR), Genoa (QOA), Livamo (LEG),
Milan (MIL), Rome(???) Trieste (TRS), Turin (TRN), Xxxxxx (VCE), Verona (VRN)
Postal codes: 00010-00199 02019 03010-04100 07010-67100 86010-93011 93013-93019 94010-94100
ZONE 3 SOUTH
Service Centers: Bari (BRI), Catania (CTA), Naples (NAP), Perugia(QPG)
Postal codes: 01010-02018 02020-02100 05010-06100 70010-86100 93012 93100 95010-98100
Netgear, Inc. CONFIDENTIAL INFORMATION Page 24
Netgear and Furness Logistics Operating Agreement
RATES
FURNESS LOGISTICS DISTRIBUTION FROM TERMINAL MOERDIJK TO EUROPEAN DESTINATIONS IN EURO
NUMBER OF
100 X 120CM
PALLETS 10 23 35 40 50 60 68 80
LINZ-
NOT HEAVIER WIEN VOSENDORF KREMS-DONAU LEONDING SALZBURG INNSBRUCK DORNBIRN GRAZ
THAN 900 KG AUSTRIA AUSTRIA AUSTRIA AUSTRIA AUSTRIA AUSTRIA AUSTRIA AUSTRIA
1 193 193 193 189 189 174 174 212
2 337 337 337 327 327 286 286 369
3 430 430 430 407 407 376 376 456
4 444 444 444 412 412 383 383 470
5 464 464 464 429 429 397 397 482
6 478 478 478 444 444 406 406 493
7 537 537 537 496 496 456 456 551
8 537 537 537 496 496 456 456 551
9 610 610 610 562 562 517 517 622
10 683 683 683 622 622 579 579 695
11 732 732 732 665 665 623 623 747
12 781 781 781 709 709 663 663 796
13 842 842 842 757 757 709 709 857
14 891 891 891 801 801 746 746 906
15 952 952 952 850 850 793 793 967
16 952 952 952 850 850 793 793 967
17 1010 1010 1010 893 893 842 842 1025
18 1054 1054 1054 923 923 878 878 1066
19 1098 1098 1098 964 964 922 922 1116
20 1132 1132 1132 998 998 951 951 1150
21 1176 1176 1176 1039 1039 990 990 1197
22 1215 1215 1215 1076 1076 1021 1021 1238
23 1281 1201 1281 1134 1134 1069 1069 1305
24 1281 1281 1281 1134 1134 1069 1069 1305
25 1281 1281 1281 1134 1134 1069 1069 1305
26 1317 1317 1317 1170 1170 1086 1086 1357
Netgear, Inc. CONFIDENTIAL INFORMATION Page 25
Netgear and Furness Logistics Operating Agreement
VALID UNTIL 31.12.2001
NUMBER OF
100 X 120
CM PALLETS 90 95 93 60 26 27 0
NOT HEAVIER KLAGENFURT VILLACH AALST SOFIA BRNO XXXXX BALLERUP HELSINKI
THAN 900 KG AUSTRIA AUSTRIA BELGIUM BULGARIA CZECH REP DENMARK DENMARK FINLAND
1 212 212 69 361 247 204 204 201
2 369 369 105 634 376 259 259 343
3 456 456 137 828 449 394 394 574
4 470 470 151 1127 508 492 492 604
5 482 482 167 1385 583 589 589 749
6 493 493 187 599 984
7 551 551 206 614 984
8 551 551 216 694 984
9 622 622 226 730 1209
10 695 695 236 762 1209
11 747 747 245 788 1209
12 796 796 255 814 1402
13 857 857 264 840 1402
14 906 906 274 866 1402
15 967 967 284 889 1564
16 967 967 300 913 1564
17 1025 1025 305 936 1564
18 1066 1066 309 960 1651
19 1116 1116 312 983 1651
20 1150 1150 314 1007 1651
21 1197 1197 316 1030 2212
22 1238 1238 321 1054 2212
23 1305 1305 322 1077 2212
24 1305 1305 323 1101 2212
25 1305 1305 324 1124 2212
26 1357 1357 327 1148 2212
Netgear, Inc. CONFIDENTIAL INFORMATION Page 26
Netgear and Furness Logistics Operating Agreement
1 75 78 95 95 93 47 56
MOERS
VANTAA PARIS CHESNAY GOUSSAINVILLE ROISSY PANTIN HUELSDONK NEUWIED
FINLAND FRANCE FRANCE FRANCE FRANCE FRANCE GERMANY GERMANY
1 219 150 150 150 150 150 68 93
2 368 267 267 267 267 267 82 112
3 609 267 267 267 267 267 128 192
4 638 321 321 321 321 321 147 223
5 789 321 321 321 321 321 179 274
6 103S 374 374 374 374 374 196 298
7 1035 428 428 428 428 428 214 326
8 1035 428 428 428 428 428 237 363
9 1266 481 481 481 481 481 262 398
10 1266 481 481 481 481 481 282 430
11 1266 535 535 535 535 535 307 457
12 1464 535 535 535 535 535 333 493
13 1464 588 588 588 588 588 354 515
14 1464 641 641 641 641 641 374 522
15 1635 641 641 641 641 641 425 544
16 1635 681 681 681 681 681
17 1635 681 681 681 681 681
18 1725 722 722 722 722 722
19 1725 762 762 762 762 762
20 1725 762 762 762 762 762
21 2314 802 802 802 802 802
22 2314 802 802 802 802 802
23 2314 802 802 802 802 802
24 2314 802 802 802 802 802
25 2314 802 802 802 802 802
26 2314 802 802 802 802 802
Netgear, Inc. CONFIDENTIAL INFORMATION Page 27
Netgear and Furness Logistics Operating Agreement
64 80 82 85 85 94 94 10
DARMSTADT MUNICH FURSTENFELDBRUCK ISMANING POING DORNACH STRAUBING ATHENS*
GERMANY GERMANY GERMANY GERMANY GERMANY GERMANY GERMANY GREECE
1 122 139 139 139 139 139 139 243
2 146 167 167 167 167 167 167 407
3 248 340 340 340 340 340 340 645
4 295 407 407 407 407 407 407 927
5 369 507 507 507 507 507 507 1098
6 403 565 565 565 565 565 565 1230
7 442 628 628 628 628 628 628 1435
8 495 698 698 698 698 698 698 1435
9 537 764 764 764 764 764 764 1600
10 579 817 817 817 817 817 817 1801
11 622 879 879 879 879 879 879 2001
12 668 947 947 947 947 947 947 2059
13 698 985 985 985 985 985 985 2240
14 699 1030 1030 1030 1030 1030 1030 2420
15 719 1061 1061 1061 1061 1061 1061 2601
16 2601
17 2781
18 2908
19 3084
20 3260
21 3435
22 3611
23 3611
24 3611
25 3611
26 3611
Netgear, Inc. CONFIDENTIAL INFORMATION Page 28
Netgear and Furness Logistics Operating Agreement
20 29 50 74 20 20 8 19
SAN GARDERMOEN
XXXXX XXXXXXXX EINDHOVEN DEVENTER PARK KLOFTA BARCELONA ALOVERA
ITALY ITALY HOLLAND HOLLAND NORWAY NORWAY SPAIN SPAIN
1 117 117 50 50 230 230 156 244
2 163 163 74 74 358 358 256 446
3 227 227 85 85 570 570 396 723
4 288 288 97 97 584 584 446 844
5 351 351 109 109 715 715 496 970
6 415 415 123 123 496 970
7 481 481 138 138
8 547 547 149 149
9 612 612 161 161
10 676 676 168 185
11 732 732 173 209
12 786 786 187 232
13 837 837 204 251
14 881 881 221 263
15 932 932 232 275
16 978 978 244 287
17 1022 1022 256 299
18 1059 1059 268 311
19 1105 1105 280 322
20 1152 1152 292 334
21 1191 1191 303 346
22 1230 1230 315 358
23 1266 1266 327 370
24 1300 1300 339 382
25 1357 1357 351 394
26 1400 1400 363 404
Netgear, Inc. CONFIDENTIAL INFORMATION Page 29
Netgear and Furness Logistics Operating Agreement
28 45 10 17 19 19 21 62
MADRID MEJORADA STOCKHOLM JARFALLA KUNGSANGEN ROSERSBERG MALMO ALTISHOFEN
SPAIN SPAIN SWEDEN SWEDEN SWEDEN SWEDEN SWEDEN SWITZERLAND
1 178 244 207 207 207 207 162 179
2 299 446 313 313 313 313 236 224
3 467 723 498 498 498 498 376 262
4 564 844 511 511 511 511 386 285
5 662 970 625 625 625 625 469 337
6 662 970 782 782 782 782 591 384
7 782 782 782 782 591 429
8 782 782 782 782 591 456
9 905 905 905 905 681 506
10 905 905 905 905 681 538
11 905 905 905 905 681 582
12 1135 1135 1135 1135 864 594
13 1135 1135 1135 1135 864 647
14 1135 1135 1135 1135 864 694
15 1254 1254 1254 1254 966 741
16 1254 1254 1254 1254 966 767
17 1254 1254 1254 1254 966 816
18 1394 1394 1394 1394 1074 863
19 1394 1394 1394 1394 1074 900
20 1394 1394 1394 1394 1074 927
21 1660 1660 1660 1660 1381 968
22 1660 1660 1660 1660 1381 1016
23 1660 1660 1660 1660 1381 1021
24 1660 1660 1660 1660 1381 1026
25 1660 1660 1660 1660 1397 1035
26 1660 1660 1660 1660 1397 1044
Netgear, Inc. CONFIDENTIAL INFORMATION Page 30
Netgear and Furness Logistics Operating Agreement
00 00
XXXXXXX XXXXXXXX*
XXXXXXXXXXX XXXXXX
1 179 236
2 224 447
3 262 784
4 285 953
5 337 1180
6 384 1239
7 429 1434
8 456 1434
9 506 1448
10 538 1620
11 582 1792
12 594 1865
13 647 2028
14 694 2192
15 741 2355
16 767 2355
17 816 2518
18 863 2682
19 900
20 927
21 968
22 1016
23 1021
24 1026
25 1035
26 1044
Netgear, Inc. CONFIDENTIAL INFORMATION Page 31
Netgear and Furness Logistics Operating Agreement
B BB CV KT RG SL YO
BIRMINGHAM ACCRINGTON WARWICK CHESSINGTON BRACKNELL MAIDENHEAD YORK
UK UK UK UK UK UK UK
1 179 210 171 156 171 163 186
2 301 343 290 269 290 280 311
3 417 478 402 372 402 387 433
4 438 515 419 380 419 400 458
5 541 642 516 465 516 491 566
6 549 645 525 478 525 502 573
7 593 696 567 515 567 541 619
8 636 748 608 552 608 580 664
9 661 777 632 574 632 603 690
10 746 848 721 670 721 695 772
11 829 942 801 744 801 773 857
12 857 951 834 787 834 810 881
13 914 995 893 853 893 873 934
14 957 1048 934 889 934 912 980
15 993 1086 969 923 969 946 1016
16 1028 1123 1004 957 1004 980 1052
17 1099 1198 1074 1024 1074 1049 1124
18 1134 1252 1105 1046 1105 1075 1163
19 1199 1324 1168 1106 1168 1137 1231
20 1225 1367 1190 1119 1190 1154 1261
21 1288 1438 1251 1176 1251 1213 1326
22 1351 1509 1312 1233 1312 1272 1391
23 1360 1526 1318 1235 1318 1277 1401
24 1368 1542 1324 1237 1324 1281 1412
25 1428 1611 1382 1290 1382 1336 1473
26 1488 1680 1440 1344 1440 1392 1536
Netgear, Inc. CONFIDENTIAL INFORMATION Page 32
