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Exhibit 10.33
DISTRIBUTION
AGREEMENT
This Distribution Agreement
(hereinafter referred to as the “Agreement”) is made
and entered into as of this 1 st day of November, 2001, between
Altera International Limited having its principal place of business
at 2102 Tower 6, The Gateway, Harbour City, 9 Canton Road,
Tsimshatsui, Kowloon (hereinafter referred to as
“Altera”) and Arrow Asia Distribution, Ltd., a
corporation, having its principal place of business at 20/F., Ever
Gain Plaza, Tower 2, 88, Container Port Road, Kwai Chung, Hong
Kong, (hereinafter referred to as
“Distributor”).
WITNESSETH:
WHEREAS, Altera is the owner,
manufacturer, and developer of certain Products defined below,
and
WHEREAS, Distributor wishes to be
appointed as a non-exclusive distributor of the Products under the
terms and conditions of this Agreement;
NOW THEREFORE, the parties agree as
follows:
1.1 “Products” or
“Product” means semiconductor components, programming
hardware, Software Products, and related materials that may be
offered for sale by Altera in the ordinary course of business and
that have not been excluded from the definition of Products by
written notice from Altera to Distributor.
1.2 “Sale” or
“Purchase” shall also be understood to mean
“License”.
1.3 “Software Products”
means software development tools for programmable logic design,
simulation, testing, and for programming as offered for license by
Altera in the ordinary course of business.
1.4 “Territory” means
the following customers on a world-wide basis, excluding the United
States and Canada: [ * ] and their affiliates, and their respective
contract manufacturers, to the extent acting on their
behalf.
1.5 “Trademarks” means
(i) both the name “Altera” and the corresponding
stylized mark and logotype; and (ii) the trademarks, trade names,
and service marks of the Products and the respective stylized marks
and logotypes for such trademarks, trade names, and service
marks.
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Altera hereby appoints Distributor
and Distributor hereby accepts the appointment, as a non-exclusive
Distributor of the Products within the Territory.
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3.
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DISTRIBUTOR
RESPONSIBILITIES
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3.1 Promotion and Sales
Efforts . Distributor shall use its reasonable best efforts
to:
(a) Promote the sales of and
distribute Products within the Territory. Except as allowed by
separate written agreement between the parties, Distributor shall
not solicit sales of Products outside the Territory.
(b) Obtain directly from Altera and
authorized Altera distributors 100% of its requirements of Altera
products.
(c) Make full use of all promotional
material supplied by Altera.
(d) Maintain the total dollar value
of inventory of Products at Distributor in an amount mutually
agreed to by both parties.
(e) Maintain inventories of a broad
selection of Products, especially newly introduced Products,
sufficient to satisfy the needs of large and small customers in a
timely manner.
(f) Provide and maintain adequate
sales facilities and sales and support personnel in accordance with
reasonable standards that from time to time are established by
Altera and that are reasonably agreed to by Distributor.
(g) Provide and maintain Product
programming facilities, equipment, and personnel in accordance with
reasonable standards that from time to time are established by
Altera and that are reasonably agreed to by Distributor.
(h) Make available sales,
engineering, and support personnel to attend Altera sponsored
training.
(i) Keep Altera informed of industry
trends and competitive conditions that may affect the sale of
Altera Products.
(j) Adhere to operational policies
and procedures that Altera will publish (and revise from time to
time), including the Distributor Policies and Procedures Manual, in
order to fulfill the provisions of this Agreement, to facilitate
Altera’s business with Distributors, and promote sales to
customers. In the event of any inconsistency between such published
operational policies and the provisions of this Agreement, the
provisions of this Agreement shall govern.
3.2 Monthly Reporting
Responsibilities . On or before the expiration of five (5)
working days after the end of each month, Distributor shall provide
a confidential report to Altera containing the following
information as well as any other information reasonably requested
by Altera from time to time:
(a) a sales report which contains
the names of purchasers, locations, part numbers, quantity and
Dollar value of Products sold in each such month; the part numbers,
quantity and dollar value of any Products returned to Distributor
by customers; and any ship from stock and debit (“SSD”)
numbers; and
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(b) an inventory report which
contains a listing by part number and quantity of all Products in
stock as of the end of such month.
This monthly reporting is to be in
the form of direct data transmission or magnetic media in standard
computer readable format.
3.3 Mutual Covenants
.
(a) The Parties agree to conduct
business in a manner that reflects favorably at all times on the
Products and the good name, goodwill and reputation of one another.
However, nothing in this paragraph shall obligate Altera to grant
Distributor any preferential treatment over other distributors in
the Territory.
(b) Neither party shall engage in
deceptive, misleading, or unethical practices that are or might be
detrimental to the other party, the Products, or the public,
including, but not limited to, disparagement of the other party or
the Products and use of misleading advertising.
(c) Neither party shall make false
or misleading representations with regard to the other party and
will make no representations to customers or to the trade with
respect to the specifications, features or capabilities of the
Products that are inconsistent with the literature distributed by
Altera.
3.4 Distributor’s Financial
Condition . Distributor is in satisfactory financial condition,
solvent and able to pay its bills when due. Altera will have the
right to establish credit limits and other financial requirements
as a condition of Distributor’s right to place orders with
Altera and shall also have the right in its reasonable discretion
to change such credit limits and financial requirements at any
time. In connection with any decision by Altera to establish a
credit limit for Distributor, Distributor will furnish such
financial reports and other financial data as Altera may reasonably
request as necessary to determine Distributor’s financial
condition.
3.5 Compliance With Law .
Each party will comply with all applicable international,
transnational, national, regional, and local laws and regulations
in performing its duties under this Agreement and in any dealings
with respect to Products.
3.6 Compliance With Export
Administration Laws . In recognition of U.S. and non-U.S.
export control laws and regulations, each party agrees to obtain
any necessary export license or other documentation prior to
exportation of any Product, or technical data acquired from Altera
under this Agreement. Accordingly, neither party shall knowingly
sell, export, re-export, transfer, divert or otherwise dispose of
any such Product or technical data directly or indirectly to any
person, firm or entity, or country or countries, prohibited by the
laws or regulations of the United States or any other country.
Further, Distributor shall use its reasonable best efforts to
notify any person, firm or entity obtaining such products or
technical data from Distributor of the need to comply with such
laws and regulations.
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3.7 Auditing . No more than
twice during any year, at reasonable times and upon reasonable
prior notice, employees of Altera may i) conduct a physical
inventory of Products in any stocking location (or, in automated
facilities, observe cycle counts and related methodology) or ii)
audit such business records, located at Distributor’s
corporate headquarters as pertain solely to the purchase of
Products hereunder during any such year.
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4.
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ALTERA’S RESPONSIBILITY
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Altera will furnish Distributor
without charge a reasonable supply of Altera’s current list
of published suggested prices, sales literature, books, catalogs,
etc. as Altera may prepare for distribution, and shall also provide
Distributor with such technical and sales assistance as may be
necessary to assist Distributor in effectively carrying out its
obligations under this Agreement. Altera reserves the right to sell
directly to any and all customers.
5.1 Orders . Distributor will
place individual orders for the Products from time to time during
the term of this Agreement either by means of electronic data
transmission or in written form. This Agreement shall govern to the
extent that any terms in this Agreement are inconsistent with the
terms of any agreement between Altera and Distributor relating to
electronic data transmission. Each order placed by Distributor will
contain the following minimum information: (i) identification of
each Product ordered by Product number, quantity, and price; (ii)
shipping instructions and destination; and (iii) a requested
delivery date for each Product.
5.2 Acceptance by Altera .
All orders for the Products by Distributor shall be subject to
acceptance by Altera and shall not be binding until the earlier of
such acceptance or shipment, and, in the case of acceptance by
shipment, only as to the portion of the order actually shipped.
Altera has the right to refuse to accept, for any reason, any order
placed by Distributor. Altera shall use its reasonable best efforts
to accept any order for non-custom Products within ten (10) days of
its receipt.
5.3 Controlling Terms . The
terms of this Agreement will apply to each order accepted or
shipped by Altera under this Agreement. In the event that any terms
or conditions of sale contained in any communication between
Distributor and Altera contradict or are inconsistent with anything
contained in this Agreement, the terms and conditions of this
Agreement shall prevail. Altera’s acceptance of any order
from Distributor under this Agreement is conditioned on Distributor
agreeing that the terms of this Agreement shall prevail over any
additional or inconsistent terms communicated by Distributor to
Altera in any form whatsoever.
5.4 Quantity . All component
orders of custom Products only are subject to an overrun or under
run of [ * ] of the quantity ordered which shall constitute
fulfillment of the order by Altera.
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5.5 Change Orders and
Cancellation by Distributor .
(a) Standard Products : All
orders submitted by Distributor and accepted by Altera are firm
commitments by Distributor to buy Altera Products. Distributor will
notify Altera in a timely manner of its desire to change any order.
Altera shall have the right to deny any change order request
submitted by Distributor within [ * ] of the current factory
scheduled shipment date. However, within the period from [ * ] of
the current factory scheduled shipment date, Altera will
accommodate reasonable requests for changes. Within the period from
[ * ] of current factory scheduled shipment date, Altera will
accept change orders only in extraordinary circumstances;
Altera’s shall have the sole right to determine what
circumstances are extraordinary. Altera’s acceptance of any
change order request within [ * ] of current factory scheduled
shipment shall not obligate Altera to accept future change order
requests submitted within [ * ] of shipment. On an ongoing and
regular basis, Distributor will use its best efforts to reconcile
its own records of orders on Altera with Altera’s records of
order backlog.
(b) Custom Products : From
time to time, Distributor may place orders on Altera for Custom
Product. (Custom Product is defined as Product that is not listed
in Altera’s published distributor price list and/or that
requires special processing by Altera.) Once accepted by Altera,
orders for Custom Product may not be changed in any way without
prior approval of Altera. As a pre-condition to approving a request
to change an order for Custom Product, Altera may require
Distributor to compensate Altera for any costs incurred by Altera
as a result of the change order.
5.6 Cancellation by Altera .
Altera reserves the right to cancel any orders placed by
Distributor and accepted by Altera as set forth above, or to refuse
or delay shipment thereof, if:
(a) Distributor fails to make any
payment as provided in this Agreement or under the terms of payment
set forth in any invoice or otherwise agreed to by Altera and
Distributor;
(b) Distributor fails to meet
reasonable credit or financial requirements established by Altera,
including any limitations on allowable credit;
(c) Distributor otherwise fails to
comply with the terms and conditions of this Agreement;
(d) this Agreement is terminated and
the scheduled delivery would take place after the Agreement’s
termination date; or
(e) circumstances beyond
Altera’s control prevent it from shipping any order by the
requested delivery date.
Altera also reserves the right to
discontinue the manufacture or distribution of any or all of the
Products at any time, and to cancel any orders for such
discontinued Products without liability of any kind to Distributor
or to any other person except as expressly set forth herein. No
such discontinuation will be deemed a termination (unless Altera so
advises Distributor) or breach of this Agreement by Altera. Altera
will attempt, but is not required, to provide Distributor with at
least sixty (60) days advance written notice of Product
discontinuances in the same manner as is provided to customers in
general.
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6.1 Terms and Interest .
Payment shall be made according to the terms specified by Altera,
as agreed by Distributor. Interest shall be payable at the rate of
one-and-one-half percent (1.5%) per month or at the maximum rate
permitted by law, whichever is less, on all overdue and unpaid
invoices. Altera has the right to invoice Distributor for any
unauthorized discounts or deductions taken by Distributor, and
Distributor shall make payment on such invoices [ * ].
6.2 Method of Payment .
Distributor shall make payment in Dollars as designated by Altera
or in such other method as agreed to by the parties in
writing.
6.3 Taxes, Tariffs, and Fees
. Unless otherwise agreed in writing by Altera, all prices quoted
by Altera for the Products do not include any national, state, or
local sales, use, value added or other taxes, customs duties, or
similar tariffs and fees. Distributor shall be responsible and
liable for the payment of any taxes, customs duties, or other
government fees and tariffs applicable to the Products, except for
taxes based on Altera’s net income, unless Distributor has
provided Altera with an exemption resale certificate in the
appropriate form for the jurisdiction to which the Products are to
be directly shipped. Distributor agrees to indemnify Altera for any
claim for taxes, customs duties, or other government fees and
tariffs applicable to the Products that may be levied on
Altera.
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7.
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SHIPMENT AND
RISK OF LOSS:
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7.1 Shipment . Orders issued
by the Distributor will specify requested shipment dates.
Distributor will select the mode of shipment and the carrier.
Altera will pay for packing costs. Distributor and Altera shall
mutually agree on who will be responsible for and pay all charges
for shipping, freight, and any insurance.
7.2 Delays in Shipment .
Altera will use commercially reasonable efforts to ship products to
arrive by any requested delivery dates quoted or acknowledged.
However, Altera will not be liable for any delay in shipment or
delay in performance under this Agreement due to unforeseen
circumstances or due to causes beyond its control including but not
limited to, acts of nature, acts of government, labor disputes,
delays in transportation, and delays in delivery or inability to
deliver by Altera’s suppliers.
7.3 Risk of Loss . All risk
of loss of, or damage to, the Products will pass to Distributor, or
to such financing institution or other party or parties as may have
been designated to Altera by Distributor, upon delivery by Altera
to the carrier, freight forwarder or Distributor, whichever first
occurs. Distributor will bear the risk of loss or damage in
transit.
8.1 Altera’s Prices .
Distributor shall purchase products at Altera’s prices as are
in effect at the time the order is received from the
Distributor.
8.2 Price Changes : From time
to time, Altera may decide to change the prices for the
Products.
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(a) Price decreases : In the
event of a price decrease by Altera, Altera will invoice
Distributor at the lower price for all orders placed by Distributor
that have not been delivered as of the effective date of the price
decrease.
(b) Price increases : In the
event of a price increase, Altera will announce to Distributor its
intention to raise prices at least [ * ] before the effective date
of such a price increase. All orders on Altera’s backlog as
of the announcement of the price increase and scheduled for
delivery by Altera within [ * ] of announcement shall be shipped at
the price that was effective before the price increase. All other
orders shall ship at the new, increased price. Distributor shall
have the right to cancel (within [ * ] of the announcement of a
price increase) any orders for Product for which Altera has
announced a price increase.
8.3 Credit for Inventory Invoiced
at Higher Price . In the event of a price decrease, Altera
shall issue a credit to Distributor in the amount of the price
decrease for all unsold Products then stocked by the Distributor
provided that Distributor satisfies the terms and conditions
specified in subparagraph 8.4 and 8.5(b) and (c).
8.4 Record Keeping for Price
Decrease Credits . As a condition of Altera issuing Distributor
a credit pursuant to subparagraph 8.3, Altera must receive an
inventory report from Distributor no later than thirty (30) days
after the effective date of the price decrease. No credit will be
due Distributor if Distributor fails to furnish such inventory
report within the thirty-day period. Altera shall have the right to
audit the information provided in this report against the previous
inventory reports and subsequent resale reports
