Purchase Agreement - FLASH Electronics Inc. and SonicWALL Inc.


                              Purchase Agreement
                                    Between
                            FLASH Electronics Inc.
                                      and
                                  SONICWALLs

     This purchase agreement is entered into effect as of 9/28/99 between FLASH
Electronics Inc. located at 4050 Starboard Drive, Fremont, CA 94538 and 
SONICWALL located at 5400 Betsy Ross Dr., Santa Clara, CA 95054.

     This agreement is intended to define the basic business agreement between 
the two companies. Additional details may be defined in subsequent business 
agreement.

     Under the agreement FLASH Electronics will provide custom manufacturing 
services to SONICWALL. These services include purchasing components, material 
management, assembling of printed circuit boards, testing, troubleshooting, 
reworks, final assembly, packaging and shipping. The products will be covered by
a 6-month warrantee for workmanship to IPC 610 class 2 standards.

PURCHASE OF MATERIAL

     In order for FLASH to purchase material for SONICWALL products 
manufacturing, SONICWALL will provide a 3 month hard copy Purchase Order plus a 
3 months rolling forecast. This forecast is required to allow sufficient time to
plan and procure material in timely and orderly manner. It is understood that 
SONICWALL will be responsible for the costs of the 30 days material inventory, 
WIP inventory and unique SONICWALL materials (Enclosure, PWA, etc.,) at Flash 
Electronics. SONICWALL will also be liable for material with long leadtimes 
provided Flash identifies such items in writing either as an attachment to this 
agreement or other mutually acceptable manner. Flash Electronics shall follow 
common industry practice to plan and buy in reasonable quantity to protect 
lead-time requirements, safety stock, minimum buy quantity and volume discounts 
if available.

INVOICING AND PAYMENT

     Subject to acceptance of Products and parts within 3 days of receiving, 
invoices shall be due and payable thirty (30) days after the date of actual 
receipt of the products or parts. Any other applicable discounts or price 
reductions shall be referenced on the invoice. Payments past 45 days may be 
subject to 1.5% monthly finance charge.

CANCELLATIONS

     In the event SONICWALL decides to terminate a purchase order either 
actually or constructively (i.e. engineering change resulting in obsolescence.),
SONICWALL liability, in addition to NCNR components, shall include excess or 
obsolete safety stock if these items are non-returnable such as open package and
incomplete reel. SONICWALL will reimburse Flash Electronics the restocking
charge or other penalties required by component vendor. SONICWALL will also be
liable for all work in process (WIP). Products in WIP and non-returnable
components will be shipped to SONICWALL 30 days from the date of
cancellation notice.

 

Page 2 Flash Purchase agreement


RESCHEDULES

SONICWALL shall not cancel nor reschedule the delivery date if it is within 30 
days of the original scheduled date. However a 50% adjustment in quantity is 
acceptable for increased quantity and 30% adjustment for decreased quantity 
between 30 and 60 days of the original scheduled date. A change in total 
quantity is acceptable beyond the 60 days delivery window as long as SONICWALL
agrees to buy back the NCNR material in excess of 60 days supply based on the
new schedule. In return, Flash shall purchase from SONICWALL before buying them
from other supplies for future demand.

FREIGHT AND SHIPPING CONTAINERS

     Flash will follow SONICWALL instructions in the selection of freight 
carrier and to determine shipping priority. SONICWALL shall provide complete 
packing instruction and a list packing material. Shipments will be FOB Fremont 
billed to SONICWALL freight account. Flash will provide free local pick up and 
delivery with company vehicles to SONIC facility within 30 miles distance of the
Flash Fremont facility.

TERMINATION OF THIS CONTRACT

     Either party may terminate this agreement, by a written notice to the other
party not less than 180 days prior to the effective date of such termination. 
The termination of this agreement shall in no way relieve either party of any
sum of money and liability that have accrued prior to such termination.

By: /s/ Michael J. Sheridan                 By: /s/ Paul Belknap
   --------------------------------           -----------------------------
Printed name: Michael J. Sheridan           Printed name: Paul Belknap
             ----------------------                      ------------------
Title: Chief Financial Officer              Title: Director of Sales
      -----------------------------               -------------------------
Date:      9/29/99                          Date:      9/29/99
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