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 10.23
FRY'S ELECTRONICS
CORPORATE XXXXXX
000 X. XXXXXX XXXX, XXX XXXX, XX 00000
(000) 000-0000
VENDOR AGREEMENT
Company Name: NETGEAR Telephone: (000)-000-0000
Company Address: 0000 Xxxxx Xxxxxxx Xxxx, Xxxxx Xxxxx, XX 00000-0000
Sales Contact: Xxxx Xxxxxx Acctg. Contact:__________
INTRODUCTION
- In order to formalize our relationship, we require all Vendors to sign
a Vendor Agreement with Fry's Electronics, Inc. ("Fry's"). This Vendor
Agreement will serve to clarify any questions you may have on how Fry's
does business with its Vendors. It is our desire to establish a
relationship that is beneficial to us both.
- Fry's conducts its business in accordance with the highest professional
and ethical standards. Fry's policy prohibits the solicitation or
acceptance of any bribe, kickback or gratuity by any Fry's employee in
the transaction of its business. The payment of any bribe, kickback or
gratuity is not a condition for doing business with Fry's. Vendor shall
report any violation of this policy to Fry's Vice President or General
Manager located at 000 Xxxx Xxxxxx Xxxx, Xxx Xxxx, Xxxxxxxxxx, 00000,
(000) 000-0000.
TERMS OF PRICING
The following terms of pricing shall be deemed to be included in all Fry's
purchase orders:
- For products that are purchased directly from the manufacturer, the
Vendor agrees that all prices offered to Fry's will be no higher than
any other like reseller for the same quantity purchased.
- All product in stock and/or owned by Fry's, the price of which is
reduced by Vendor, shall be covered by price protection in the form of
a credit by Vendor and/or debit memo by Fry's without any requirement
that Fry's buy additional product. Price protection is the amount equal
to [*]. If there are no outstanding invoices to offset, Vendor shall
pay Fry's, in the form of a check, the amount of the price protection.
TERMS OF PURCHASE
The following terms of purchase shall be deemed to be included in all Fry's
purchase orders:
- Product reorder payment terms must be at least [*].
- All payment terms are from the date that Fry's receives the goods.
Verification of date of receipt may be obtained by the Vendor from the
Shipper based on the Xxxx of Lading shipping date.
- Under no circumstances shall Fry's be liable for interest, service
charges, late charges or similar charges incurred due to late payment.
- Fry's has the right to offset credits against any outstanding invoices.
These credits include, but are not limited to, returned merchandise
credits, market development funds, co-op advertising funds, or price
protection credits.
- All purchase orders are for immediate shipment unless specifically
written as a future order.
- Vendor performance is continually reviewed by the length of time it
takes to receive and turn each product
TERMS OF SHIPPING
The following terms of shipping shall be deemed to be included in all Fry's
purchase orders:
- All product shall be shipped at Vendor's expense to the individual
Fry's store designated in the purchase order.
- Fry's will pay only the cost of the product received and will deduct
from the invoice any additional line item charges such as shipping,
handling or insurance.
- Title to and risk of loss of the product shall remain with the Vendor
until received by Fry's.
- Product damages in transit will be refused and shall promptly be
removed from the Fry's store where delivered by Vendor at Vendor's
expense.
- Any and all shortages shall be deducted from the invoices, including
concealed shortages.
- Any product shipped on pallets to the Fremont, CA location must be
delivered by a truck with a lift gate. Any palletized product not so
delivered to Fremont, CA will be refused.
TERMS OF RETURN OF PRODUCT
Fry's shall have the following rights to return product purchased from Vendor:
- Upon the termination of Vendor's relationship with Fry's, Fry's may
return any product purchased from Vendor in Fry's inventory at the time
of termination for a full refund of the purchase price of the returned
product.
- No restocking or similar fees shall be charged by Vendor for any
returned product.
- All returned product will be a credit against other purchases by Fry's,
which will not furnish invoice numbers nor serial numbers from the
original invoices. If there are no outstanding invoices to offset,
Vendor shall pay Fry's for returned product.
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- Vendor hereby issues to Fry's the following blanket Returned
Merchandise Authorization Number QTR RMA's for the return of defective
merchandise, customer dissatisfaction returns, products that have been
discontinued by manufacturer.
- Cost of shipment and risk of defective merchandise, customer
dissatisfaction returns, or products that have been discontinued by
manufacturer shall be at Vendor's expense.
WARRANTY AND INDEMNITY
- Vendor warrants that all products sold to Fry's [*] by a Fry's
customer. In Fry's California stores, this is per Civil Code Section
1790-1795.8, Song-Xxxxxxx Consumer Warranty Act. Any product purchased
by Fry's from Vendor, which is returned by a customer of Fry's for
defect, shall be returned to Vendor for credit, repair or replacement
in accordance with the terms of return above.
ADVERTISING AND MARKET DEVELOPMENT FUNDS
- Vendor has the responsibility to develop demand for its products and to
ensure that product is available to meet demand. The Vendor is
encouraged to state in its advertising that its product is available to
Fry's. Fry's shall preapprove, in writing, any use of its name or logo.
- Fry's would like the opportunity to support and promote Vendor's
products in its local markets, as well. To do this, it is expected that
the Vendor [*]. The Vendor may also be asked for support on occasion
for special Fry's marketing events, such as new store openings and
specialized media campaigns. Program details are available through the
Purchasing Department. For all orders, Vendors agrees to allow Fry's
[*]. Vendor is encouraged to maintain contact with the buying
organization to ensure that Vendor's products are being properly
marketed.
- Vendor may also be asked to participate in radio, television and/or
print advertising campaigns to develop markets. Any such advertising
shall be the subject of a separate agreement. All agreed-upon print
advertising [*]. Fry's will not supply proof of performance with
respect to cooperative advertising.
SERVICE
ELECTRICAL TESTING AND CERTIFICATIONS
- Vendors selling products to be sold at Fry's stores located in the City
of Los Angeles agree that they will complete all Los Angeles
code-required electrical testing and subsequent labeling of all
electrical equipment that will be displayed, offered for sale, or
employed for personal or business use. Electrical equipment includes
material, fitting devices, appliances, fixtures, apparatus and the like
used as part of, or in connection with, an electrical installation. An
electrical installation is defined as, in essence, machines or
apparatus operating on alternating current. An example would be items
which are directly plugged into the wall. If testing and labeling
requirements are not adhered to, Fry's shall remove the product from
sale, use or display and shall return the product for credit in the
amount of its purchase price as provided in the terms of return above.
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GENERAL TERMS OF AGREEMENT
The following general terms shall apply to this Agreement:
- The relationship between both Fry's and Vendor will begin on the date
the Vendor Agreement is completed and signed by an officer or agent of
Vendor's company and an authorized representative of Fry's.
- The terms of this Agreement shall override and supersede any
conflicting terms in any other document between the parties including,
but not limited to, Vendor's invoices.
- All chargebacks (such as unearned payment terms, deductions for
shortages, price protection, advertising, return product shortages,
return product pricing errors) aged more than [*] will require the
Vendor to immediately place Fry's on Credit Hold, otherwise the
chargeback will be forgiven by Vendor and Fry's will no longer be
liable for the chargeback. Chargebacks are not considered to be shipped
invoices.
- All notices should be sent to:
Xxxxxxx X. Xxxxxx, Vice President
Fry's Electronics, Inc.
000 X. Xxxxxx Xxxx
Xxx Xxxx, XX 00000
- If legal action is necessary to enforce or interpret this Agreement of
any of its provisions, the prevailing party shall receive its
reasonable attorneys' fees and costs at the option of the court.
- This Agreement may be terminated by either party upon thirty (30) days
written notice to the other party. All agreements of Vendor contained
herein, including, but not limited to, those related to returns,
warranty and indemnity shall survive termination.
- The parties agree that the place of making and performance of this
Agreement in the City of Xxx Xxxx, Xxxxxx xx Xxxxx Xxxxx, Xxxxx xx
Xxxxxxxxxx and that the exclusive venue for any action to enforce or
for breach of this Agreement shall be in the courts of the State of
California, in the County of Santa Xxxxx.
- This Agreement shall be interpreted and construed according to the laws
of the State of California.
- In the event that any one or more of the provisions, or parts of any
provisions, contained in this Agreement shall for any reason be held to
be invalid, illegal or unenforceable in any respect by a court of
competent jurisdiction, the same shall not invalidate or otherwise
affect any other provision hereof, and this Agreement shall be
construed as if such invalid, illegal or unenforceable provision, or
part of any provision, had never been contained herein.
REFERENCE INFORMATION
Vendor must supply the following information:
Company Legal Name of Company: NETGEAR INC., A NORTEL NETWORKS COMPANY
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Address: 0000 XXXXX XXXXXXX XXXXXXX XXXXX XXXXX, XX 00000-0000
Telephone Number: (000)-000-0000
The Company mentioned above is a: [X] Corporation [ ] Partnership [ ] Sole
Proprietor [X] Other: SUBSIDIARY
Taxpayer I.D.:______________________ OR Social Security Number:________________
Provide the name, address and telephone number of the bank that the
above-mentioned Company uses and the person to contact at this bank for a
reference:
Bank Name: ____________________________________ Contact Name: __________________
Address: _______________________________________________________________________
Telephone Number: ____________________
List the name of the Purchasing Supervisor who will be Vendor's contact at
Fry's: ___________________
List the name and telephone number of the person at Vendor for Fry's to contact
should there be difficulties processing this Agreement:
Name: ______________________________________ Phone: ____________________________
FRY'S CURRENT BILLING ADDRESS
The current billing address is Fry's Electronics, Inc., Accounts Payable Dept.,
000 Xxxx Xxxxxx Xxxx, Xxx Xxxx, Xxxxxxxxxx 00000. All invoices or communications
regarding invoices should be sent to this address until further notice.
I have read the above-mentioned Agreement and agree to all its terms and
conditions, and Addendum I & II.
VENDOR FRY'S ELECTRONICS, INC.
Date: __________________________________ Date: 10/21/98
By: __________________________________ By: /S/ ILLEGIBLE
-------------
Title: __________________________________ Title: VP
(Must be an Officer)
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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.
FRY'S CONTRACT TERMS
ADDENDUM 10/8/98
The following is an Addendum to Fry's Electronics standard Vendor Agreement
dated March 26, 1998:
DISCOUNT: [*]
TERMS OF PRICING
1. Price protection must be submitted to NETGEAR within [*] after a price
change.
TERMS OF RETURN OF PRODUCT
1. NETGEAR will provide RMA numbers that will be valid for [*] at a time.
2. The total value of returned products is not to exceed [*] of the net
shipments of the previous quarter. Exceptions can be made if mutually
agreed upon.
3. Remote guidelines for return of product for initial orders.
4. Return of product will be allowed if NETGEAR causes the termination.
WARRANTY AND INDEMNITY
1. NETGEAR will not be responsible for issues not directly related to
their product. Claims made by Fry's regarding NETGEAR products while
selling and advertising, are to be based only on materials provided by
NETGEAR.
2. LIMITATION. These warranties do not apply to any Product which has been
(i) altered, except by NETGEAR or in accordance with its instructions,
or (ii) used in conjunction with another vendor's product if such use
results in the defect, or (iii) damaged by improper environment, abuse,
misuse, accident or negligence. Replacement parts furnished under this
warranty may be refurbished or contain refurbished components.
THE FOREGOING WARRANTIES AND LIMITATION ARE EXCLUSIVE REMEDIES AND RE IN LIEU OF
ALL OTHER WARRANTIES, EXPRESS OR IMPLIED, INCLUDING, WITHOUT ANY LIMITATION,
WARRANT OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE. ANY PRODUCT THAT
MAY BE FURNISHED BY NETGEAR WHICH IS NOT LISTED IN THE PRICE LIST, OR WHICH IS
IDENTIFIED IN THE PRICE LIST AS AN "AS IS" PRODUCT IS FURNISHED "AS IS" WITH NO
WARRANTIES OF ANY KIND.
SERVICE
1. Delete section on service - NETGEAR provides factory service
only.
GENERAL TERMS OF AGREEMENT
1. Change sixty (60) days to ninety (90) days from receipt of check date.
2. A direct relationship is not possible without monthly sales results and
inventory levels. This is an accounting and financial requirement that
is necessary for NETGEAR to book the sales to Fry's.
SOFTWARE
1. Retailer may procure for and distribute licenses to use NETGEAR
software and accompanying documentation by placing orders under this
Agreement. The terms of the licenses for such Software to which
end-users are subject are included as a "shrink-wrap" license agreement
with the Software and in its accompanying documentation when shipped by
NETGEAR (the "License Agreement"). Retailer agrees that for each
Software product it procures under this Agreement, Retailer will (i)
assure the delivery of the License Agreement to its customers and (ii)
use reasonable efforts to inform its resale customers of the
requirement to deliver the License Agreement to their end-user
customers in the form supplied by NETGEAR with the Products.
2. Retailer may not, nor authorize its resale customers or the end-user
to, translate, decompile, disassemble, use for any competitive
analysis, or reverse engineer the Software or its documentation, in any
way. Retailer may not, nor authorize its resale customers or the
end-user to, translate any portion of the Software or associated
documentation into any other format or foreign language without the
prior written consent of NETGEAR. In no event may Retailer grant the
U.S. Government rights in any Software greater than those set out in
subparagraphs (a) through (d) of the Commercial Computer Software -
Restricted Rights clause at FAR 52.227-19 and the limitations for
civilian agencies set out in the License Agreement; and subparagraph
(e)(l)(ii) of the Rights in Technical Data and Computer Software clause
at DFARS 252.227-7013 for agencies of the Department of Defense.
3. If all or part of the NETGEAR products or updates delivered to Retailer
have been licensed by NETGEAR from a third party software supplier,
then, notwithstanding anything to the contrary contained in this
Agreement, Retailer and its resale customers or the end-user is granted
a sublicense to the third party software subject to the same terms and
conditions as those contained in the agreement between that third party
supplier and NETGEAR and/or Bay Networks. NETGEAR reserves the right to
substitute any third party software in the NETGEAR Products so long as
the new third party software does not materially affect the
functionality of the NETGEAR Products.
NETGEAR FRY'S ELECTRONICS, INC.
Date: 12/1/98 Date: 10/21/98
By: /S/ ILLEGIBLE By: /S/ ILLEGIBLE
------------------------- --------------------
Title: VP, GM, WPD Title: VP
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ADDENDUM II
WARRANTY
WARRANTY PERIOD. The warranty period for each Product is specified in the Price
List that is in effect on the date NETGEAR receives Fry's order, and shall apply
regardless of any extended warranty period which you may choose to provide to
your customers. NETGEAR reserves the right to change a warranty period for a
specific Product but only for orders placed after the effective date of such
change. The minimum warranty period for any Product shall be one year or as
otherwise required by law.
HARDWARE WARRANTY. NETGEAR warrants to the end-user that each item of Hardware
will be free from defects in workmanship and materials for its respective
warranty period which begins on the date of purchase by the end-user. End-user's
exclusive remedy and NETGEAR's sole obligation and liability under this warranty
is to promptly repair or replace any failed Product returned by Fry's on behalf
of an end-user because of defects in workmanship or material.
SOFTWARE WARRANTY. NETGEAR warrants to the end-user that each item of Software,
as delivered or updated by NETGEAR and properly installed and operated on the
Hardware or other equipment it is originally licensed for, will function during
its respective warranty period substantially as described in the user
documentation supplied by NETGEAR with the Software. If any item of Software
ails to so perform during its warranty period, as the sole remedy NETGEAR will
at its discretion provide a suitable fix, patch or workaround for the problem
which may be included in a future revision of the Software. For specific
Software which is distributed by NETGEAR as a licensee of third parties,
additional warranty terms offered by such third parties to end-users may apply
and will be included in the documentation supplied with the software.
LIMITATIONS. NETGEAR does not warrant that any item of Software is error free or
that its use will be uninterrupted. NETGEAR is not obligated to remedy any
Software defect which cannot be reproduced with the latest revision of the
Software. These warranties do not apply to any Product which has been (i)
altered, except by NETGEAR or in accordance with its instructions, (ii) used in
conjunction with another vendor's product resulting in the defect, or (iii)
damaged by improper environment, abuse, misuse, accident or negligence.
Replacement parts furnished under this warranty may be refurbished or contain
refurnished components.
THE FOREGOING WARRANTIES AND LLIMITATIONS ARE EXCLUSIVE REMEDIES AND ARE IN LIEU
OF ALL OTHER WARRANTIES EXPRESS OR IMPLIED, INCLUDING, WITHOUT ANY LIMITATION,
WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE. THE FOREGOING
NOTWITHSTANDING, IN FRY'S CALIFORNIA STORES, NETGEAR'S OBLIGATIONS UNDER
WARRANTY SHALL BE PER CIVIL CODE SECTION 1790-1795.8, SONG-XXXXXXX CONSUMER
WARRANTY ACT.
INFRINGEMENT INDEMNIFICATION
NETGEAR agrees to indemnify Fry's against any claim that the Products infringe
any U.S. patent, copyright or trademark, provided that Fry's (1) gives NETGEAR
prompt written notice of any claim, (2) grants NETGEAR control of the defense
and settlement of such claim, and (3) assists fully in the defense so long as
NETGEAR pays Fry's out-of-pocket expenses. NETGEAR shall have no liability for
any settlement or compromise made without its prior written consent. NETGEAR
shall, at is option and expense, (i) procure
the right for the end-user to continue using the Product, (2) replace or modify
the Product so that it becomes noninfringing or (3) accept return of the Product
and refund an amount equal to the price paid by Fry's for the infringing
Product.
NETGEAR shall have no liability or obligation for any infringement claim based
upon (1) modifications of the Products by parties other than NETAGEAR or use of
such modified Product or (2) use of the Products in combination with materials
or products not supplied or approved by NETGEAR if such combined use is the
cause of the infringement.
THE ABOVE STATES THE ENTIRE LIABILITY OF NETGEAR AND IS THE SOLE AND EXCLUSIVE
REMEDY WITH RESPECT TO CLAIMS OF INFRINGEMENT OF PROPRIETARY RIGHTS OF ANY KIND.
LIABILITY
NETGEAR agrees to indemnify Fry's against any claim arising out of or resulting
from the Products, provided that any such claim (1) is attributable to bodily
injury or death or to injury to or destruction of physical property (other than
the Products) and (2) is caused by a negligent act or omission of NETGEAR. This
obligation on the part of NETGEAR shall exist only if you (1) give NETGEAR
prompt written notice of any such claim, (2) grant NETGEAR control of the
defense and settlement of such claim, and (3) assist fully in the defense so
long as NETGEAR pays the out-of-pocket costs. NETGEAR shall have no liability
for any settlement or compromise made without its prior written consent.
EXCEPT AS OTHERWISE REQUIRED BY LAW, NETGEAR SHALL NOT UNDER ANY CIRCUMSTANCES
BE LIABLE TO ANY PERSON FOR ANY SPECIAL, INCIDENTAL, INDIRECT OR CONSEQUENTIAL
DAMAGES, INCLUDING, WITHOUT LIMITATION, DAMAGES RESULTING FROM USE OR
MALFUNCTION OF THE PRODUCTS, LOSS OF PROFITS OR REVENUES OR COSTS OF REPLACEMENT
GOODS, EVEN IF NETGEAR IS INFORMED IN ADVANCE OF THE POSSIBILITY OF SUCH
DAMAGES.
Except as specifically provided for in this Agreement or as required by law, in
no event will NETGEAR's liability in connection with the Products or this
Agreement exceed the amounts actually paid to NETGEAR under this Agreement for
the Products giving rise to such liability. These limitations apply to all
causes of action in the aggregate.
FRY'S ELECTRONICS, INC.
/S/ Xxxxxxx X. Xxxxxx
Xxxxxxx X. Xxxxxx, V.P.
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