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Exhibit 10.2
SAMSUNG DISPLAYS DEVICES, INC
DISTRIBUTOR AGREEMENT
This agreement is made on June 24,1999, by and between Samsung Display Devices
Inc., a California corporation, having its main office and principal place of
business at 00000 Xxxxxxxxx Xxxxxx, Xxxxxx Xxxxxxxxx, XX 00000 (hereinafter
referred to as IISDDIII or "Samsung,,), and Reptron Electronics Inc. located at
00000 XxXxxxxxx Xxxxx, Xxxxx, XX 00000 (herein after referred to as
"Distributor") .
WHEREAS, SDDI is engaged in the business of manufacturing and selling Liquid
Crystal Displays; and
WHEREAS, DISTRIBUTOR wishes to act as a distributor of such products sold by
SDDI;
NOW, THEREFORE, in consideration of the mutual promises and covenants herein
contained, the parties hereto agree as follows;
1. Appointment
SDDI hereby appoints DISTRIBUTOR a non-exclusive distributor of the goods
described in Section 4 (hereinafter referred to as the "Goods"), in accordance
with the provisions of this Agreement.
2. Duties of Distributor
In connection with its appointments, DISTRIBUTOR shall perform the following
duties:
2.1 Use its best efforts to actively promote the sale of the Goods to customers
in the Territory. Such efforts shall include, but not be limited to, promptly
servicing all customer accounts, soliciting new customer accounts, and
cooperating and participating in SDDI's advertising and sales promotional
programs;
2.2 Maintain adequate office and warehouse facilities;
2.3 Maintain an inventory of the Goods, as recommended by SDDI, sufficient to
support the sales plan for each location of DISTRIBUTOR mutually agreed to
periodically between SDDI and DISTRIBUTOR; and
2.4 Make monthly sales analysis reports to SDDI in accordance with the Report &
Audits as defined in Section 19.
3. Territory
While nothing in this Agreement shall restrict the territory within which
DISTRIBUTOR shall be free to distribute the Goods, DISTRIBUTOR's area of
primary responsibility for distribution of the Goods (referred to herein as the
"Territory") shall he U.S.A. SDDI reserves the right to make sales, or
indirectly, to customers located within the Territory.
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4. Goods
4.1 The Goods subject to this Agreement shall be SDDI's standard products,
Liquid Crystal Displays and other products set forth an SDDI's Standard
Distributor Price List (the "Price List")SDDI reserves the right to amend such
Price List from time to time by issuing a revised Price List to DISTRIBUTOR. In
addition, SDDI may, from time to time, in its absolute discretion and without
thereby incurring any liability to the DISTRIBUTOR with respect to any sales
contract or purchase order therefore placed or otherwise, alter the design or
construction of any Goods, and substitute such altered Goods for the prior
goods in filling orders.
5. ORDERS, DELIVERY, RESCHEDULING, CANCELLATION
5.1 ORDERS; Delivery of Products under this Agreement shall be initiated by
written or electronic purchase orders (or by telephonic orders) confirmed in
writing by DISTRIBUTOR within thirty (30) calendar days. Such orders shall
describe the Products ordered and the quantities thereof, shall request
delivery dates, shall set forth prices and shall provide shipping instructions,
where appropriate. SDOI shall acknowledge each such order in writing at the
earliest possible date, but in any event within fifteen (15) calendar days
following receipt thereof. In such acceptance, SDDI shall confirm the Requested
Shipment Date or specify an Alternative Shipment Date ("Acknowledged Shipment
Date").
5.2 METHOD OF SHIPPING In the absence of specified instructions from
DISTRIBUTOR, the shipping and packaging method will be in the discretion of
SDDI. SDDI shall, consistent with sound business practice, select a method of
shipping and packaging which is suitable for the Product. In the event of any
misdelivery by the Carrier, SDDI shall assist DISTRIBUTOR in tracing the
shipment and obtaining delivery of the Products.
5.3 RESCHEDULING AND CANCELLATION ; DISTRIBUTOR may, prior to thirty (30)
calendar days of the Acknowledged Shipment Date and with written notice at that
time, reschedule the Acknowledged Shipment Date of any order and may cancel it
prior to ninety (90) calendar days of the Acknowledged Shipment Date and with
written notice at that time.
6. Prices
6.1 The prices to DISTRIBUTOR shall be those prices established from time to
time by SDDI as shown on SDDI's Price List. All prices shall be subject to
change or withdrawal at the discretion of SDDI, with or without advance notice.
Notice of any changes in prices shall be given by mailing to DISTRIBUTOR a new
Price List or written advises.
6.2 In case of price increase, SDDI will give the thirty (30) days advance
notice prior to the effective date. Prior to the effective date of a price
increase, Distributor may order Products
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before the price increase takes effect at the prior (i.e. lower) price.
Furthermore, all Products entered by Distributor prior to notification of a
price increase are exempt from the increase and will be shipped and invoiced at
the price in effect at the time of order placement.
6.3 The exception to the prices set forth on SDDI's Price List will be special
prices for contract sales, which shall be granted case by case by written
advises.
6.4 In the event that it should become necessary, and on a by exception basis
only, Distributor shall be permitted to sell Product to customers on a meet
competition basis where Distributor's current costs are not competitive enough
for Distributor to secure the orders. Upon receipt of the approval from the
SDDI, Distributor shall be entitled to ship from stock a defined quantity and
part number(s) to a specific customer at or below Distributor's cost and issue
a debit to the SDDI for the difference between Distributor's current cost of
the Product (less any prior credits granted by SDDI on such Products) and the
approved new cost issued by the SDDI multiplied by the quantity of such Product
shipped to the specific customer. In order to claim such credit, Distributor
shall submit to SDDI within forty-five (45) calendar days after the sale took
place, a debit note in conjunction with Distributor's monthly Reports as
specified in Paragraph 18. Credits will be applied to future purchases of SDDI
Product or to Distributor's Accounts receivable with SDDI.
7.Payment Terms
Payment terms on all Goods will be net thirty (30) days from date of invoice.
8. Price Reductions and Price reduction Credits
8.1 In the event that SDDI reduces the price of any of its Goods sold to
DISTRIBUTOR, DISTRIBUTOR shall be eligible to receive a credit (to be applied
against future purchases only) on the price of all such Goods held in inventory
by the DISTRIBUTOR at the time the price reduction becomes effective, in an
amount equal to the difference between the value (as defined below) of such
Goods and such reduced price.
8.2 In order to be eligible for such credit, DISTRIBUTOR must furnish SDDI,
within thirty (30) days after the effective date of a price reduction on a
particular item of Goods, a written claim stating the quantity of such item in
its inventory on the effective date of the price reduction.Such claim will be
subject to verification by SDDI.
8.3 As used in this Agreement, the term value shall mean the lesser of (1) the
net price of such Goods Or (2) the actual price of the Goods invoiced to the
DISTRIBUTOR less any price reduction credits granted by SDDI. As used in this
Agreement, the term 11 net price means the net price of such Goods stated in
SDDI's most recent
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Published Distributor Price List, less any trade discounts, cash
discounts,returns, freight and transportation allowances and credits other than
price reduction credits.
9. Use of SDDI Name
This Agreement shall in no way be construed as authorizing DISTRIBUTOR any
rights in, the name of SDDI, the Samsung logo or any other trademark or trade
name of Samsung.
10. Warranty
The Products shall be covered by SDDI's standard warranty terms and provisions,
provided, however, that the warranty coverage shall be no less than the
following:
(i) The warranty period set forth therein shall run for twelve (12) months
following DISTRIBUTOR's shipment of the Product to their customer except as
otherwise expressly provided in such warranty. The date of shipment will not
exceed six (6) months after purchasing the Product from SDDI.
(ii) SDDI shall extend such warranty directly to the customer as if such
customer had purchased the Products directly from SDDI.
(iii) SDDI shall warrant the Products against defects in material and
workmanship under normal use and service, repair or replace at SDDI's cost any
defective Product (or issue a credit or refund, as the case may be, based on
the purchase price paid therefor);and
(iv) SDDI shall pay (or refund the amount of) all freight and shipping charges
for any defective Products returned under this paragraph.
SDDI MAKES NO REPRESENTATION OR WARRANTY OF ANY KIND, EXPRESS OR IMPLIED, AS TO
MERCHANTABILITY, FITNESS FOR PARTICULAR PURPOSE, OR ANY OTHER MATTER WITH
RESPECT TO THE GOODS, whether used alone or in combination with other
substances.
11.Advertising and Sales Promotion
11.1 SDDI may, from time to time, at its sole discretion, disclose its
promotional plans, render sales assistance and merchandising advice, or furnish
advertising materials and promotional campaign material to DISTRIBUTOR,
11.2SDDI will contribute an amount equal to one half (1/2) of the cost of
jointly approved promotional and advertising activities designed to stimulate
the sale of SDDI's Goods. Such contribution shall not exceed one percent (1%)
of the actual net price paid to SDDI for Goods sold hereunder.
12. Limitation of Liability Within thirty (30) days after receipt of each
shipment of Goods sold hereunder, DISTRIBUTOR shall examine such Goods for
any damage,
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defects or shortage. All claims, including for alleged damaged or defective
Goods, shortage, negligence or any other cause whatsoever, shall be deemed
waived unless made in writing received by Sol within sixty (60)days after
DISTRIBUTOR's receipt of the Goods or within thirty (30)days after DISTRIBUTOR
learns of the facts giving rise to the claim,whichever first occurs.
DISTRIBUTOR's exclusive remedy, and SDDI's sole and exclusive liability, shall
be the repair or replacement of such Goods or (at SDDI's sole option) the
issuing of credit therefore in accordance with SDDI's warranty policy appearing
on paragraph 10. IN NO EVENT SHALL SDDI BE LIABLE FOR ANY SPECIAL, INCIDENTAL
OR CONSEQUENTIAL DAMAGES, WHETHER DISTRIBUTOR'S CLAIM IS FOR BREACH OF
CONTRACT, BREACH OF WARRANTY, NEGLIGENCE OR OTHERWISE.
13. Credit Worthiness
SDDI reserves the right, among other remedies, either to terminate this
agreement or to suspend further deliveries under it in the event DISTRIBUTOR
fails to pay for any shipment when tame becomes due. Should DISTRIBUTOR's
financial situation become unsatisfactory to SDDI, cash payments or
satisfactory security may be required by SDDI for future deliveries and for
Goods already delivered.
14. Returns
The following conditions will apply in the event DISTRIBUTOR desires to return
any returnable Goods to SDDI for credit; 14.1All requests for returns must be
submitted by DISTRIBUTOR to SDDI for approval, to the attention of the Manager
of Distributor Sales. Any returns made without SDDI's prior approval shall be
returned to DISTRIBUTOR at DISTRIBUTOR's expense.
14.2 During the first six (6) months of this Agreement, DISTRIBUTOR may return
to SDDI up to 10096 of the value of DISTRIBUTOR's inventory of Goods, provided,
however, that concurrently with the return of any Goods and as A condition to
such return, DISTRIBUTOR must purchase Goods having a net price (as defined in
subparagraph 8.3) which is at least equal to the amount of the credit granted.
The purchased Goods must be of the same type.
14.3 For each six (6) months period following the first six (6) months of this
Agreement, DISTRIBUTOR's right to return Goods shall be limited to ten percent
(10%) of the total amount billed by SDDI to DISTRIBUTOR during the immediately
preceding six (6) months period, subject to the same purchase requirement set
forth in subparagraph 14.2 above.
14.4 If SDDI approves the return of any Goods, DISTRIBUTOR shall ship such
Goods to SDNI freight prepaid.
14.5 Any credit for returned Goods is subject to the inspection and testing of
such Goods by SDDI. If, in SDDI's judgment, any of such Goods have been
improperly handled or used, no credit or replacement for those Goods will be
allowed.
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14.6 The credit for any returned Goods shall be equal to the lesser of SDDI's
net price to a DISTRIBUTOR for such Goods as of the day they are received by
SDDI.
14.7 All customs or semi-customs products shall not be included in definition
of "Goods" for purposes of this section 14.
15. Assignment
DISTRIBUTOR shall not assign its rights or delegate its performance hereunder
without the prior written consent of SDDI and any attempted assignment or
delegation without such consent shall be void.
16. Independent Contractor
The relationship between SDDI and DISTRIBUTOR under this Agreement is solely
that of buyer and, seller. DISTRIBUTOR is and shall be an independent
contractor in the performance of the services set forth by this Agreement.
Neither DISTRIBUTOR nor anyone employed by DISTRIBUTOR shall act or purport to
act or be deemed to be the agent, representative, employee or servant of SDDI
-in performing the services covered by this Agreement. DISTRIBUTOR shall have
no right to enter into contracts or commitments in the name or on behalf of
SDDI or to bind SDDI in any respect whatsoever.
17. Indemnification SDDI will indemnify, defend and otherwise hold harmless,
DISTRIBUTOR , its affiliates and customers from all cost, loss, damage or
liability arising from any proceeding (legal or equitable) or claim brought or
asserted against DISTRIBUTOR, its affiliates or customers, to the extent such
proceeding or claim is based on an allegation that the Products, or any part
thereof, or their distribution or use constitute an infringement of any patent,
copyright, trademark secret or violation of any legislation now or hereafter
enacted, or like or similar claim, if DISTRIBUTOR promptly notifies SDDI of any
such proceeding or claim after it becomes known to DISTRIBUTOR and DISTRIBUTOR
provides all the assistance and cooperation to SDDI that is reasonably
requested including the right of SDDI to select and instruct legal counsel for
the purposes of any defense of DISTRIBUTOR within the meaning of this
provision. SDDI shall not be liable to DISTRIBUTOR under any provision of this
paragraph to the extent that any claim is based upon; (i)a use for which the
Product or part was not designated; or (ii)an alteration of the Product or part
by DISTRIBUTOR or a third party under DISTRIBUTOR's direction and which
alteration has caused the infringement action.
18. Term and Termination
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This Agreement shall become effective on the date set forth above and shall
remain in effect until terminated by either xxxxx as set forth below.
18.1 DISTRIBUTOR's rights hereunder shall automatically terminate in the
event that it is adjudicated as bankrupt, becomes insolvent or makes an
assignment for the benefit of its creditors.
18.2 Either SDDI or DISTRIBUTOR may terminate this Agreement for any reason
whatsoever, with or without cause, thirty (30) days after written notice
thereof in writing has been given to the other party.
18.3 In the event of a termination pursuant to this Section 18, SDDI shall
offer to repurchase all GOODS (except all custom or semicustom products) which
appear in SDDI's then current Price List and are in DISTRIBUTOR's inventory at
the time of such termination, and which are undamaged and in saleable
condition, on the following terms and conditions:
18.3.1 DISTRIBUTOR shall within thirty (30) days following such termination,
furnish SDDI with an inventory of all Goods which it desires to have SDDI
repurchase pursuant to this subparagraph 18.3. SDDI shall not be obligated to
repurchase any Goods from DISTRIBUTOR if DISTRIBUTOR has not submitted the
inventory report within such thirty (30) day period.
18-3.2 DISTRIBUTOR shall ship such Goods to SDDT freight prepaid to the office
at Rancho Xxxxxxxxx, California or such other locations as SDDI may designate.
18.3.3 SDDI shall not be obligated to repurchase any Goods which are defective
or not in saleable condition at the time of their receipt by SDDI. In no event
shall SDDI be obligated to repurchase any custom or semicustom products.
18.3.4 The price paid by SDDI for any Goods repurchased shall be the lesser of
SDDI's net price for such Goods as of the date they are received by SDDI or the
value of such Goods.
18.3.5 In the event DISTRIBUTOR terminates this Agreement, or SDDI terminates
this agreement with cause, the price determined pursuant to subparagraph 18.3.4
above shall be reduced by a ten percent (10%) restocking charge. In the event
that SDDI terminates this Agreement without cause, a restocking charge will not
be applied. 18.4Neither SDDI nor DISTRIBUTOR shall, by reason of the
termination or nonrenewal of this Agreement, be liable to the other for
compensation, reimbursement or damages, either on account of present or
prospective profits on sales or anticipated sales, or on account of
expenditures, investments or commitments made in connection with this
Agreement, or in connection with the establishment, development or maintenance
of the business or goodwill of SDDI or DISTRIBUTOR, or on account of any other
cause or matter whatsoever, provided, however, that such termination or
nonrenewal shall not affect the rights or liabilities of the parties with
respect to any breach of this Agreement prior to such termination, any Goods
previously ordered or sold hereunder, or any indebtedness then owing by either
party to the other. The acceptance of any order for the sale of any Goods to
DISTRIBUTOR after the termination or expiration of this Agreement shall not be
construed as a renewal or extension of this Agreement, nor as a waiver of any
such termination or expiration.
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19. Reports & Audits
DISTRIBUTOR agrees to prepare and forward to SDDI reports as may be reasonably
requested by SDDI, including, without limitation, monthly reports of inventory
on hand by each location, and sales data by each location. Sales data should
include part number, customer, customer address and zip code, quantity, net
cost and extension, net resale and extension, type of transaction, and customer
invoice number. Inventory data should include part number, quantity, quantity
by price, special purchase item, and any bonded or specially segregated stock
(with reason identified). DISTRIBUTOR will also submit monthly reports by
location showing all customer returns for the previous month indicating product
part number, quantity, cost price (net of special cost debits), resale cost,
extension, customer name, zip code and credit memo number, if applicable, and
original invoice number for the purpose the determining the cost. Parties shall
use FIFO or LIFO consistent with DISTRIBUTOR's own accounting method.
DISTRIBUTOR will send this data to SDDI on a timely basis each month and in no
case later than the 10th working day of the following month. If the DISTRIBUTOR
fails to comply, it is considered a material breach of the Agreement. SDDI
reserves the right to have an authorized SDDI representative at SDDI's cost
audit DISTRIBUTOR's records relating to sales and inventory of products,
including, without limitation, records pertaining to any claims submitted by
DISTRIBUTOR for price protection, stock rotation, returned products, ship from
stock and debit, or any other reason DISTRIBUTOR agrees that with reasonable
notice by SDDI, DISTRIBUTOR's will allow SDDI access to all SDDI inventory for
the purpose of inspecting or auditing such inventory at SDDI's request.
20. Excuse of Performance
The obligation of the parties may be suspended by either party in the event of
an act of God, war, riot, fire, explosion, accident, flood, sabotage; lack of
adequate fuel, power, raw materials, labor, containers or transportation
facilities, compliance with governmental requests, laws, regulations, orders or
action; breakage of failure of machinery or apparatus; national defense
requirements, or any other event beyond the reasonable control of such party;
or in the event of labor trouble, strike, lockout, or injunction ( provided
that neither party. Shall be required to settle a labor dispute against its own
best judgement); which event makes impracticable the manufacture,
transportation, acceptance or use of a shipment of Goods or of a material upon
which the manufacture of the goods is dependent. if, because of any such event,
it is impracticable for SDDI to supply the total demand for the Goods, SDDI may
allocate its available supply of Goods, without obligation to purchase similar
goods form other sources, among itself and its customers, including (at SDDI's
option) those not under contract, on such basis as it determined to be
equitable. Deliveries suspended under this Section 18 shall be cancelled
without liability, but this Agreement otherwise remain unaffected.
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21. Terms and Conditions of Sale
The sales of all Goods pursuant to this Agreement shall be governed by the
terms and conditions set forth in this Agreement and by the terms and
conditions Of sales set forth on SDDI's acknowledgement form issued by SDDI in
response to DISTRIBUTOR's purchase order. In the event of a conflict between
the terms of this Agreement and the terms and conditions set forth on SDDI's
acknowledgement from, the terms of this Agreement shall control. Any terms and
conditions appearing on DISTRIBUTOR's purchase order or any similar document
issued by DISTRIBUTOR shall be wholly inapplicable to any sales made pursuant
to this Agreement.
22. Applicable Law and Jurisdiction
The laws of the State of California shall apply and bind the parties in any and
all questions arising hereunder, regardless of the jurisdiction in which the
question arose or occurred. Any litigation under this Agreement shall be
instituted in the court of competent jurisdiction of the State of California
sitting in Los Angeles, or the US District Court sitting in Los Angeles,
California, and the parties hereby submit to the jurisdiction of such courts
23. Waiver
No wavier by either SDDI or DISTRIBUTOR with respect to any branch or default
shall limit any right or remedy of either party, unless such waiver is
expressed in a writing signed by the party to be bound.
24. Complete Agreement
This Agreement, including the attachments hereto and the documents referred to
herein, constitutes the full understanding of the parties, and a complete and
exclusive statement of the terms of their agreement. Except as otherwise
provided herein, no conditions, understanding or agreement purporting to modify
or vary the terms of this Agreement shall be binding -unless hereafter made in
writing and signed by the party to be bound.
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IN WITNESS WHEREOF, the parties hereto have signed this Agreement.
Company: Reptron Electronic Inc. Samsung Display Devices, Inc.
/s/ Xxxx Xxxxxxxx /s/ Young W. Park
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Name: Xxxx Xxxxxxxx Young W. Park
Title: Vice President Marketing/Ops President
Name: Young W. Park
Title: Title; PRESIDENT
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