Exhibit 10.20
XXXX MICROPRODUCTS INC.
CONSIGNED INVENTORY AGREEMENT
Agreement entered into as of the 23rd day of February, 2001, by and between XXXX
MICROPRODUCTS INC., a California corporation, with its principal place o
business at 0000 Xxxxxxxx Xxxxxx, Xxx Xxxx, XX 00000 ("Xxxx"), and PC-TEL,
Global Technologies, Ltd., a Grand Cayman Island British West Indies
corporation, with its principal place of business at X.X. Xxx 00000 XXX, Xxxxx
Xxxxxx, Xxxxxxx Xxxx Indies. ("Agent")
1. Xxxx shall maintain at Agent's location stocks of the device types listed on
Schedule A annexed hereto (the "Products"). Schedule A may be amended in
writing at any time by mutual agreement of the parties, subject to all of
the terms and conditions of this Agreement. All right and title to the
Products on Agent's premises shall remain with Xxxx until delivery to end
user customer as hereinafter defined.
2. Agent shall maintain, at its sole cost and expense, a secure area (the
Product Storage Area, or "PSA"), including appropriate shelving and storage
bins, within which to store the Products. Such area shall be physically
segregated from all other property and inventory. Agent assumes
responsibility for all Products stored in the PSA, and shall restrict access
to the PSA to its employees. Xxxx employees designated by Xxxx shall also
have access to the PSA at any time during normal business hours.
3. On a periodic basis, not less than once per month, Agent will inform Xxxx of
the quantity of Products Agent has shipped on its behalf since its last such
report, and will provide copies of the related purchase orders to Xxxx for
such Products at the prices set forth on Schedule A. Under this Agreement
Agent will obtain purchase orders from its customers with payment terms
being through irrevocable letter of credit to be established through a prime
bank of international repute, on credit terms of net 60 days, and on
shipping terms of F.O.B. Agent's Hong Kong facility. Products shall be
ordered only in integer multiples of any applicable standard package
minimums as set forth in Schedule A. Agent is not authorized to accept any
purchase orders on behalf of Xxxx if there are any other or different terms
in end users customer's said purchase orders which are inconsistent with any
of the terms and provisions of this Agreement shall be void and of no force
or effect. Agent shall invoice end user customer in accordance with
provisions of paragraph 9.
4. Proceeds to Xxxx for the Products shall be as set forth in Schedule A
attached hereto, but are subject to revision based upon price changes from
the respective manufacturers of such Products, Agent shall be entitled to a
commission equal to any selling price above Xxxx'x Product proceeds set
forth in Schedule A. Agent shall have the right to approve such price
changes, provided that in the event any such changes are not approved by
Agent, the parts affected shall be eliminated from this Agreement. In the
event any such price changes are approved, Schedule A shall be amended
accordingly.
5. On a periodic basis, which may be as frequently as once per month, but not
less frequently
than once per calendar year, Xxxx may conduct a physical inventory of the
Products in the PSA. Agent shall have an authorized representative review
such physical count and shall initial the written report of such physical to
be prepared by Xxxx. In the event Agent does not make an authorized
representative available for such purpose, Agent shall be deemed to have
agreed with the report prepared by Xxxx.
If such physical count and the written report thereof are different from the
Products shown to be present in the PSA by Xxxx'x computer system, any
discrepancies will be resolved between Xxxx and Agent. Agent is responsible
for the security and control of Xxxx inventory in the PSA and bears the risk
of loss thereof. Agent will maintain sufficient insurance to cover any loss
in or to the Products in the PSA and will provide Xxxx with a certificate of
insurance evidencing such coverage.
6. Xxxx reserves the right to limit or stop the replenishment of Products in
the PSA, or to remove Products, in the event Agent fails to keep its account
current, or if and to the extent that the total dollar value of Products,
together with the amount of Agent's outstanding balance due Xxxx for more
than sixty (60) days exceeds Agent's then current credit limit with Xxxx.
Xxxx shall have the right to review Agent's credit status and to change
Agent's credit limit from time to time in Xxxx'x sole discretion.
7. This Agreement is for the term of one (1) year from the date first above
written.
8. XXXX MAKES NO EXPRESS WARRANTIES AND DISCLAIMS ANY AND ALL IMPLIED
WARRANTIES, INCLUDING BUT NOT LIMITED TO THE IMPLIED WARRANTIES OF
MERCHANTABLITY AND FITNESS FOR A PARTICULAR PURPOSE, WITH RESPECT TO
PRODUCTS IT DOES NOT MANUFACTURE. ANY AND ALL TRANSFERABLE MANUFACTURER'S
WARRANTIES FOR THE PRODUCTS WILL BE TRANSFERRED BY XXXX TO AGENT, PROVIDED
THAT SUCH TRANSFER IS WITHOUT LIABILITY ON XXXX'X PART. IN LEIU OF ANY AND
ALL OTHER WARRANTIES, INCLUDING THE IMPLIED WARRANTIES OF MERCHANTABILITY
AND FINESS FOR A PARTICULAR PURPOSE, EACH OF WHICH ARE EXPRESSLY DISCLAIMED.
XXXX WARRANTS TO AGENT THAT PRODUCTS MANUFACTURED BY XXXX SHALL BE FREE OF
DEFECTS IN MATERIAL AND WORKMANSHIP FOR A PERIOD OF NINETY (90) DAYS AFTER
TRANSFER OF SUCH PRODUCTS TO THE PSA.
9. During the term of this Agreement, Agent's authorized personnel may enter
the PSA and remove Products. The absence of or removal of, or damage to
Products in the PSA after they have been placed in the PSA shall constitute
deliver of such Products to Agent for purposes of this Agreement. Title to
the Products will pass to Agent upon deliver, as herein defined. Agent
hereby grants Xxxx a security interest in said Products, which shall
commence upon transfer to the Products to Agent, and which shall terminate
upon Agent's payment to Xxxx therefore. Agent agrees that it will not permit
any lien or encumbrance of any sort to be created or executed against the
Products in the PSA prior to its payment to Xxxx therefore.
Consigned Inventory Agreement 2
The parties will conduct a quarterly review of Agent's usage of the
Products transferred to the PSA.
Agent represents and warrants to Xxxx that it has the power and authority
to enter into and perform its obligations under this Agreement, and that
its performance of this Agreement does not constitute a violation of the
terms of, or a default under, any other Agreement to which Agent is a
party.
10. GOVERNING LAW AND ARBITRATION
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(a) This Agreement shall be governed, enforced and construed by the laws
of the State of California. Agent acknowledges that California courts
shall have exclusive jurisdiction to litigate any dispute between
Agent and Xxxx Microproducts and any and all litigation shall be
instituted and litigated in the courts of Santa Xxxxx County, State of
California, at Xxxx Microproduct's sole discretion. Agent waives any
right to change of venue or change of jurisdiction and hereby submits
to and acknowledges the jurisdiction of any such court, state, or
federal as provided herein.
(b) All disputes arising under or related to the terms of this Agreement
shall be resolved by binding arbitration in Santa Xxxxx County,
California by a panel of three arbitrators each of whom shall be a
member of the American Arbitration Association. In the event of
arbitration, one arbitrator shall be appointed by Agent, one
arbitrator shall be appointed by Xxxx and the third arbitrator shall
be selected by agreement of the first two arbitrators. Such
arbitration shall take place as soon as practicable following the
occurrence of any dispute. Any arbitration must be decided within one
year of the initial demand for arbitration or within nine months of
the appointment of the arbitral panel, either party may cancel the
arbitration and institute court actions instead. All costs of such
arbitration (or court action, if applicable) shall be borne equally by
Xxxx Microproducts Inc., and Agent.
Consigned Inventory Agreement 3
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first above written.
XXXX MICROPRODUCTS INC. PCTEL GLOBAL TECHNOLOGIES, LTD.
(Agent)
By: /s/ Xxxx X. Xxxxxxx By: /s/ Xxxxxx X. Xxxxxxx
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Name: Xxxx X. Xxxxxxx Name: Xxxxxx X. Xxxxxxx
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Title: Director Title: VP of HR, CAO
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Date: 2/23/01 Date: 2/23/01
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Consigned Inventory Agreement 4
