<PAGE>
                                                                    EXHIBIT 10.4


                                  NETGEAR, INC.

                          EMPLOYEE STOCK PURCHASE PLAN


      The following constitute the provisions of the Employee Stock Purchase
Plan of NETGEAR, Inc.

      1.    Purpose. The purpose of the Plan is to provide employees of the
Company and its Designated Subsidiaries with an opportunity to purchase Common
Stock of the Company through accumulated payroll deductions. It is the intention
of the Company to have the Plan qualify as an "Employee Stock Purchase Plan"
under Section 423 of the Code. The provisions of the Plan, accordingly, shall be
construed so as to extend and limit participation in a uniform and
nondiscriminatory basis consistent with the requirements of Section 423.

      2.    Definitions.

            (a)   "Administrator" shall mean the Board or any Committee
designated by the Board to administer the plan pursuant to Section 14.

            (b)   "Board" shall mean the Board of Directors of the Company.

            (c)   "Change of Control" shall mean the occurrence of any of the
following events:

                  (i)   Any "person" (as such term is used in Sections 13(d) and
14(d) of the Exchange Act) becomes the "beneficial owner" (as defined in Rule
13d-3 of the Exchange Act), directly or indirectly, of securities of the Company
representing fifty percent (50%) or more of the total voting power represented
by the Company's then outstanding voting securities;

                  (ii)  The consummation of the sale or disposition by the
Company of all or substantially all of the Company's assets;

                  (iii) The consummation of a merger or consolidation of the
Company, with any other corporation, other than a merger or consolidation which
would result in the voting securities of the Company outstanding immediately
prior thereto continuing to represent (either by remaining outstanding or by
being converted into voting securities of the surviving entity or its parent) at
least fifty percent (50%) of the total voting power represented by the voting
securities of the Company, or such surviving entity or its parent outstanding
immediately after such merger or consolidation; or

                  (iv)  A change in the composition of the Board, as a result of
which fewer than a majority of the Directors are Incumbent Directors. "Incumbent
Directors" shall mean Directors who either (A) are Directors of the Company, as
applicable, as of the date hereof, or (B) are elected, or nominated for
election, to the Board with the affirmative votes of at least a majority of
those Directors whose election or nomination was not in connection with any
transaction described
<PAGE>
in subsections (i), (ii) or (iii) or in connection with an actual or threatened
proxy contest relating to the election of Directors of the Company.

            (d)   "Code" shall mean the Internal Revenue Code of 1986, as
amended.

            (e)   "Committee" means a committee appointed by the Board.

            (f)   "Common Stock" shall mean the common stock of the Company.

            (g)   "Company" shall mean NETGEAR, Inc., a Delaware corporation.

            (h)   "Compensation" shall mean all base straight time gross
earnings, commissions, overtime and shift premiums, but exclusive of payments
for incentive compensation, bonuses and other compensation.

            (i)   "Designated Subsidiary" shall mean any Subsidiary selected by
the Administrator as eligible to participate in the Plan.

            (j)   "Director" shall mean a member of the Board.

            (k)   "Eligible Employee" shall mean any individual who is a common
law employee of the Company or any Designated Subsidiary and whose customary
employment with the Company or Designated Subsidiary is at least twenty (20)
hours per week and more than five (5) months in any calendar year. For purposes
of the Plan, the employment relationship shall be treated as continuing intact
while the individual is on sick leave or other leave of absence approved by the
Company. Where the period of leave exceeds 90 days and the individual's right to
reemployment is not guaranteed either by statute or by contract, the employment
relationship shall be deemed to have terminated on the 91st day of such leave.

            (l)   "Exchange Act" shall mean the Securities Exchange Act of 1934,
as amended.

            (m)   "Exercise Date" shall mean the first Trading Day on or after
[January 31 and July 31] of each year. The first Exercise Date under the Plan
shall be [January 31, 2004].

            (n)   "Fair Market Value" shall mean, as of any date, the value of
Common Stock determined as follows:

                  (i)   If the Common Stock is listed on any established stock
exchange or a national market system, including without limitation the Nasdaq
National Market or The Nasdaq SmallCap Market of The Nasdaq Stock Market, its
Fair Market Value shall be the closing sales price for such stock (or the
closing bid, if no sales were reported) as quoted on such exchange or system on
the date of determination, as reported in The Wall Street Journal or such other
source as the Board deems reliable;

                  (ii)  If the Common Stock is regularly quoted by a recognized
securities dealer but selling prices are not reported, its Fair Market Value
shall be the mean of the closing bid and asked prices for the Common Stock on
the date of determination, as reported in The Wall Street Journal or such other
source as the Board deems reliable;


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<PAGE>
                  (iii) In the absence of an established market for the Common
Stock, the Fair Market Value thereof shall be determined in good faith by the
Board; or

                  (IV)  [FOR PURPOSES OF THE OFFERING DATE OF THE FIRST OFFERING
PERIOD UNDER THE PLAN, THE FAIR MARKET VALUE SHALL BE THE INITIAL PRICE TO THE
PUBLIC AS SET FORTH IN THE FINAL PROSPECTUS INCLUDED WITHIN THE REGISTRATION
STATEMENT IN FORM S-1 FILED WITH THE SECURITIES AND EXCHANGE COMMISSION FOR THE
INITIAL PUBLIC OFFERING OF THE COMPANY'S COMMON STOCK (THE "REGISTRATION
STATEMENT").]

            (o)   "Offering Date" shall mean the first Trading Day of each
Offering Period.

            (p)   "Offering Periods" shall mean the periods of approximately
[six (6)] months during which an option granted pursuant to the Plan may be
exercised, commencing on the first Trading Day on or after [February 1 and
August 1] of each year and terminating on the first Trading Day on or before the
following January 31 and July 31 respectively; provided, however, that the first
Offering Period under the Plan shall commence with the first Trading Day on or
after the date on which the Securities and Exchange Commission declares the
Company's registration statement on Form S-1 effective and ending on the first
Trading Day on or before [January 31, 2004] and the second Offering Period under
the Plan shall commence on the first Trading Day on or after [February 1, 2004].
The duration and timing of Offering Periods may be changed pursuant to Section 4
of this Plan.

            (q)   "Plan" shall mean this Employee Stock Purchase Plan.

            (r)   "Purchase Price" shall mean 85% of the Fair Market Value of a
share of Common Stock on the Offering Date or on the Exercise Date, whichever is
lower; provided however, that the Purchase Price may be adjusted by the
Administrator pursuant to Section 20.

            (s)   "Subsidiary" shall mean a "subsidiary corporation," whether
now or hereafter existing, as defined in Section 424(f) of the Code.

            (t)   "Trading Day" shall mean a day on which national stock
exchanges and the Nasdaq System are open for trading.

      3.    Eligibility.

            (a)   First Offering Period. Any individual who is an Eligible
Employee immediately prior to the first Offering Period shall be automatically
enrolled in the first Offering Period.

            (b)   Subsequent Offering Periods. Any Eligible Employee on a given
Offering Date shall be eligible to participate in the Plan.

            (c)   Limitations. Any provisions of the Plan to the contrary
notwithstanding, no Eligible Employee shall be granted an option under the Plan
(i) to the extent that, immediately after the grant, such Eligible Employee (or
any other person whose stock would be attributed to such Eligible Employee
pursuant to Section 424(d) of the Code) would own capital stock of the Company
and/or hold outstanding options to purchase such stock possessing five percent
(5%) or more of the total combined voting power or value of all classes of the
capital stock of the Company or of any


                                      -3-
<PAGE>
Subsidiary, or (ii) to the extent that his or her rights to purchase stock under
all employee stock purchase plans of the Company and its subsidiaries accrues at
a rate which exceeds Twenty-Five Thousand Dollars ($25,000) worth of stock
(determined at the fair market value of the shares at the time such option is
granted) for each calendar year in which such option is outstanding at any time.

      4.    Offering Periods. The Plan shall be implemented by consecutive
Offering Periods with a new Offering Period commencing on the first Trading Day
on or before [February 1 and August 1] of each year, or on such other date as
the Board shall determine, and continuing thereafter until terminated in
accordance with Section 20 hereof; provided, however, that the first Offering
Period under the Plan shall commence with the first Trading Day on or after the
date upon which the Company's registration statement on Form S-1 is declared
effective by the Securities and Exchange Commission and end on the first Trading
Day on or before [January 31, 2004]. The Board shall have the power to change
the duration of Offering Periods (including the commencement dates thereof) with
respect to future offerings without shareholder approval if such change is
announced prior to the scheduled beginning of the first Offering Period to be
affected thereafter.

      5.    Participation.

            (a)   First Offering Period. An Eligible Employee shall be entitled
to participate in the first Offering Period only if such individual submits a
subscription agreement authorizing payroll deductions in the form of Exhibit A
to this Plan (i) no earlier than the effective date of the Form S-8 registration
statement with respect to the issuance of Common Stock under this Plan and (ii)
no later than five (5) business days from the effective date of such S-8
registration statement (the "Enrollment Window"). An Eligible Employee's failure
to submit the subscription agreement during the Enrollment Window shall result
in the automatic termination of such individual's participation in the Offering
Period.

            (b)   Subsequent Offering Periods. An Eligible Employee may become a
participant in the Plan by completing a subscription agreement authorizing
payroll deductions in the form of Exhibit A to this Plan and filing it with the
Company's payroll office prior to the applicable Offering Date.

      6.    Payroll Deductions.

            (a)   At the time a participant files his or her subscription
agreement, he or she shall elect to have payroll deductions made on each pay day
during the Offering Period in an amount not exceeding [10]% of the Compensation
which he or she receives on each pay day during the Offering Period; provided,
however, that should a pay day occur on an Exercise Date, a participant shall
have the payroll deductions made on such day applied to his or her account under
the new Offering Period. A participant's subscription agreement shall remain in
effect for successive Offering Periods unless terminated as provided in Section
10 hereof.

            (b)   Payroll deductions for a participant shall commence on the
first payday following the Offering Date and shall end on the last payday in the
Offering Period to which such authorization is applicable, unless sooner
terminated by the participant as provided in Section 10 hereof; provided,
however, that for the first Offering Period, payroll deductions shall commence
on the first payday on or following the end of the Enrollment Window.


                                      -4-
<PAGE>
            (c)   All payroll deductions made for a participant shall be
credited to his or her account under the Plan and shall be withheld in whole
percentages only. A participant may not make any additional payments into such
account.

            (d)   A participant may discontinue his or her participation in the
Plan as provided in Section 10 hereof, or may increase or decrease the rate of
his or her payroll deductions during the Offering Period by completing or filing
with the Company a new subscription agreement authorizing a change in payroll
deduction rate. The Administrator may, in its discretion, limit the nature
and/or number of participation rate changes during any Offering Period. The
change in rate shall be effective with the first full payroll period following
five (5) business days after the Company's receipt of the new subscription
agreement unless the Company elects to process a given change in participation
more quickly.

            (e)   Notwithstanding the foregoing, to the extent necessary to
comply with Section 423(b)(8) of the Code and Section 3(b) hereof, a
participant's payroll deductions may be decreased to zero percent (0%) at any
time during an Offering Period. Payroll deductions shall recommence at the rate
provided in such participant's subscription agreement at the beginning of the
first Offering Period which is scheduled to end in the following calendar year,
unless terminated by the participant as provided in Section 10 hereof.

            (f)   At the time the option is exercised, in whole or in part, or
at the time some or all of the Company's Common Stock issued under the Plan is
disposed of, the participant must make adequate provision for the Company's
federal, state, or other tax withholding obligations, if any, which arise upon
the exercise of the option or the disposition of the Common Stock. At any time,
the Company may, but shall not be obligated to, withhold from the participant's
compensation the amount necessary for the Company to meet applicable withholding
obligations, including any withholding required to make available to the Company
any tax deductions or benefits attributable to sale or early disposition of
Common Stock by the Eligible Employee.

      7.    Grant of Option. On the Offering Date of each Offering Period, each
Eligible Employee participating in such Offering Period shall be granted an
option to purchase on each Exercise Date during such Offering Period (at the
applicable Purchase Price) up to a number of shares of the Company's Common
Stock determined by dividing such Eligible Employee's payroll deductions
accumulated prior to such Exercise Date and retained in the Participant's
account as of the Exercise Date by the applicable Purchase Price; provided that
in no event shall an Eligible Employee be permitted to purchase during each
Offering Period more than [    ] shares of the Company's Common Stock (subject
to any adjustment pursuant to Section 19), and provided further that such
purchase shall be subject to the limitations set forth in Sections 3(b) and 12
hereof. The Eligible Employee may accept the grant of such option by turning in
a completed Subscription Agreement (attached hereto as Exhibit A) to the Company
on or prior to an Offering Date, or with respect to the first Offering Period,
prior to the last day of the Enrollment Window. The Administrator may, for
future Offering Periods, increase or decrease, in its absolute discretion, the
maximum number of shares of the Company's Common Stock an Eligible Employee may
purchase during each Offering Period. Exercise of the option shall occur as
provided in Section 8 hereof, unless the participant has withdrawn pursuant to
Section 10 hereof. The option shall expire on the last day of the Offering
Period.


                                      -5-
<PAGE>
      8.    Exercise of Option.

            (a)   Unless a participant withdraws from the Plan as provided in
Section 10 hereof, his or her option for the purchase of shares shall be
exercised automatically on the Exercise Date, and the maximum number of full
shares subject to option shall be purchased for such participant at the
applicable Purchase Price with the accumulated payroll deductions in his or her
account. No fractional shares shall be purchased; any payroll deductions
accumulated in a participant's account which are not sufficient to purchase a
full share shall be retained in the participant's account for the subsequent
Offering Period, subject to earlier withdrawal by the participant as provided in
Section 10 hereof. Any other funds left over in a participant's account after
the Exercise Date shall be returned to the participant. During a participant's
lifetime, a participant's option to purchase shares hereunder is exercisable
only by him or her.

            (b)   If the Administrator determines that, on a given Exercise
Date, the number of shares with respect to which options are to be exercised may
exceed (i) the number of shares of Common Stock that were available for sale
under the Plan on the Offering Date of the applicable Offering Period, or (ii)
the number of shares available for sale under the Plan on such Exercise Date,
the Administrator may in its sole discretion (x) provide that the Company shall
make a pro rata allocation of the shares of Common Stock available for purchase
on such Offering Date or Exercise Date, as applicable, in as uniform a manner as
shall be practicable and as it shall determine in its sole discretion to be
equitable among all participants exercising options to purchase Common Stock on
such Exercise Date, and continue all Offering Periods then in effect, or (y)
provide that the Company shall make a pro rata allocation of the shares
available for purchase on such Offering Date or Exercise Date, as applicable, in
as uniform a manner as shall be practicable and as it shall determine in its
sole discretion to be equitable among all participants exercising options to
purchase Common Stock on such Exercise Date, and terminate any or all Offering
Periods then in effect pursuant to Section 20 hereof. The Company may make pro
rata allocation of the shares available on the Offering Date of any applicable
Offering Period pursuant to the preceding sentence, notwithstanding any
authorization of additional shares for issuance under the Plan by the Company's
shareholders subsequent to such Offering Date.

      9.    Delivery. As soon as reasonably practicable after each Exercise Date
on which a purchase of shares occurs, the Company shall arrange the delivery to
each participant the shares purchased upon exercise of his or her option in a
form determined by the Administrator, including by means of electronic notice.

      10.   Withdrawal.

            (a)   A participant may withdraw all but not less than all the
payroll deductions credited to his or her account and not yet used to exercise
his or her option under the Plan at any time by giving written notice to the
Company in the form of Exhibit B to this Plan. All of the participant's payroll
deductions credited to his or her account shall be paid to such participant
promptly after receipt of notice of withdrawal and such participant's option for
the Offering Period shall be automatically terminated, and no further payroll
deductions for the purchase of shares shall be made for such Offering Period. If
a participant withdraws from an Offering Period, payroll deductions shall not
resume at the beginning of the succeeding Offering Period unless the participant
delivers to the Company a new subscription agreement.


                                      -6-
<PAGE>
            (b)   A participant's withdrawal from an Offering Period shall not
have any effect upon his or her eligibility to participate in any similar plan
which may hereafter be adopted by the Company or in succeeding Offering Periods
which commence after the termination of the Offering Period from which the
participant withdraws.

      11.   Termination of Employment. In the event a participant ceases to be
an Eligible Employee of the Company or any Designated Subsidiary, as applicable,
his or her option shall remain exercisable for a period of three (3) months from
the date of such Eligible Employee's termination. Upon the expiration of such
three (3) month period or a date prior to the expiration of such three (3) month
period if requested by the participant, any payroll deductions credited to such
participant's account during the Offering Period but not yet used to purchase
shares under the Plan shall be returned to such participant or, in the case of
his or her death, to the person or persons entitled thereto under Section 15
hereof, and such participant's option shall be automatically terminated.

      12.   Interest. No interest shall accrue on the payroll deductions of a
participant in the Plan.

      13.   Stock.

            (a)   Subject to adjustment upon changes in capitalization of the
Company as provided in Section 19 hereof, the maximum number of shares of the
Company's Common Stock which shall be made available for sale under the Plan
shall be [     ].

            (b)   Until the shares are issued (as evidenced by the appropriate
entry on the books of the Company or of a duly authorized transfer agent of the
Company), a participant shall only have the rights of an unsecured creditor with
respect to such shares, and no right to vote or receive dividends or any other
rights as a stockholder shall exist with respect to such shares.

            (c)   Shares to be delivered to a participant under the Plan shall
be registered in the name of the participant or in the name of the participant
and his or her spouse.

      14.   Administration. The Administrator shall administer the Plan and
shall have full and exclusive discretionary authority to construe, interpret and
apply the terms of the Plan, to determine eligibility and to adjudicate all
disputed claims filed under the Plan. Every finding, decision and determination
made by the Administrator shall, to the full extent permitted by law, be final
and binding upon all parties.

      15.   Designation of Beneficiary.

            (a)   A participant may file a written designation of a beneficiary
who is to receive any shares and cash, if any, from the participant's account
under the Plan in the event of such participant's death subsequent to an
Exercise Date on which the option is exercised but prior to delivery to such
participant of such shares and cash. In addition, a participant may file a
written designation of a beneficiary who is to receive any cash from the
participant's account under the Plan


                                      -7-
<PAGE>
in the event of such participant's death prior to exercise of the option. If a
participant is married and the designated beneficiary is not the spouse, spousal
consent shall be required for such designation to be effective.

            (b)   Such designation of beneficiary may be changed by the
participant at any time by written notice. In the event of the death of a
participant and in the absence of a beneficiary validly designated under the
Plan who is living at the time of such participant's death, the Company shall
deliver such shares and/or cash to the executor or administrator of the estate
of the participant, or if no such executor or administrator has been appointed
(to the knowledge of the Company), the Company, in its discretion, may deliver
such shares and/or cash to the spouse or to any one or more dependents or
relatives of the participant, or if no spouse, dependent or relative is known to
the Company, then to such other person as the Company may designate.

            (c)   All beneficiary designations shall be in such form and manner
as the Administrator may designate from time to time.

      16.   Transferability. Neither payroll deductions credited to a
participant's account nor any rights with regard to the exercise of an option or
to receive shares under the Plan may be assigned, transferred, pledged or
otherwise disposed of in any way (other than by will, the laws of descent and
distribution or as provided in Section 15 hereof) by the participant. Any such
attempt at assignment, transfer, pledge or other disposition shall be without
effect, except that the Company may treat such act as an election to withdraw
funds from an Offering Period in accordance with Section 10 hereof.

      17.   Use of Funds. All payroll deductions received or held by the Company
under the Plan may be used by the Company for any corporate purpose, and the
Company shall not be obligated to segregate such payroll deductions. Until
shares are issued, participants shall only have the rights of an unsecured
creditor.

      18.   Reports. Individual accounts shall be maintained for each
participant in the Plan. Statements of account shall be given to participating
Eligible Employees at least annually, which statements shall set forth the
amounts of payroll deductions, the Purchase Price, the number of shares
purchased and the remaining cash balance, if any.

      19.   Adjustments Upon Changes in Capitalization, Dissolution, Liquidation
or Change of Control.

            (a)   Changes in Capitalization. Subject to any required action by
the shareholders of the Company, the maximum number of shares of the Company's
Common Stock which shall be made available for sale under the Plan, the maximum
number of shares each participant may purchase each Offering Period (pursuant to
Section 7), the number of shares that may be added annually to the shares
reserved under the Plan (pursuant to Section 13(a)), as well as the price per
share and the number of shares of Common Stock covered by each option under the
Plan which has not yet been exercised shall be proportionately adjusted for any
increase or decrease in the number of issued shares of Common Stock resulting
from a stock split, reverse stock split, stock dividend, combination or
reclassification of the Common Stock, or any other change in the number of
shares of Common Stock effected without receipt of consideration by the Company;
provided, however, that conversion of any convertible securities of the Company
shall not be deemed to have been


                                      -8-
<PAGE>
"effected without receipt of consideration." Such adjustment shall be made by
the Administrator, whose determination in that respect shall be final, binding
and conclusive. Except as expressly provided herein, no issuance by the Company
of shares of stock of any class, or securities convertible into shares of stock
of any class, shall affect, and no adjustment by reason thereof shall be made
with respect to, the number or price of shares of Common Stock subject to an
option.

            (b)   Dissolution or Liquidation. In the event of the proposed
dissolution or liquidation of the Company, the Offering Period then in progress
shall be shortened by setting a new Exercise Date (the "New Exercise Date"), and
shall terminate immediately prior to the consummation of such proposed
dissolution or liquidation, unless provided otherwise by the Administrator. The
New Exercise Date shall be before the date of the Company's proposed dissolution
or liquidation. The Administrator shall notify each participant in writing, at
least ten (10) business days prior to the New Exercise Date, that the Exercise
Date for the participant's option has been changed to the New Exercise Date and
that the participant's option shall be exercised automatically on the New
Exercise Date, unless prior to such date the participant has withdrawn from the
Offering Period as provided in Section 10 hereof.

            (c)   Change of Control. In the event of a Change of Control, each
outstanding option shall be assumed or an equivalent option substituted by the
successor corporation or a Parent or Subsidiary of the successor corporation. In
the event that the successor corporation refuses to assume or substitute for the
option, any Offering Periods then in progress shall be shortened by setting a
New Exercise Date and any Offering Periods then in progress shall end on the New
Exercise Date. The New Exercise Date shall be before the date of the Company's
proposed Change of Control. The Administrator shall notify each participant in
writing, at least ten (10) business days prior to the New Exercise Date, that
the Exercise Date for the participant's option has been changed to the New
Exercise Date and that the participant's option shall be exercised automatically
on the New Exercise Date, unless prior to such date the participant has
withdrawn from the Offering Period as provided in Section 10 hereof.

      20.   Amendment or Termination.

            (a)   The Administrator may at any time and for any reason terminate
or amend the Plan. Except as otherwise provided in the Plan, no such termination
can affect options previously granted, provided that an Offering Period may be
terminated by the Administrator on any Exercise Date if the Administrator
determines that the termination of the Offering Period or the Plan is in the
best interests of the Company and its shareholders. Except as provided in
Section 19 and this Section 20 hereof, no amendment may make any change in any
option theretofore granted which adversely affects the rights of any
participant. To the extent necessary to comply with Section 423 of the Code (or
any successor rule or provision or any other applicable law, regulation or stock
exchange rule), the Company shall obtain shareholder approval in such a manner
and to such a degree as required.

            (b)   Without shareholder consent and without regard to whether any
participant rights may be considered to have been "adversely affected," the
Administrator shall be entitled to change the Offering Periods, limit the
frequency and/or number of changes in the amount withheld during an Offering
Period, establish the exchange ratio applicable to amounts withheld in a
currency other than U.S. dollars, permit payroll withholding in excess of the
amount designated by a


                                      -9-
<PAGE>
participant in order to adjust for delays or mistakes in the Company's
processing of properly completed withholding elections, establish reasonable
waiting and adjustment periods and/or accounting and crediting procedures to
ensure that amounts applied toward the purchase of Common Stock for each
participant properly correspond with amounts withheld from the participant's
Compensation, and establish such other limitations or procedures as the
Administrator determines in its sole discretion advisable which are consistent
with the Plan.

            (c)   In the event the Administrator determines that the ongoing
operation of the Plan may result in unfavorable financial accounting
consequences, the Board may, in its discretion and, to the extent necessary or
desirable, modify or amend the Plan to reduce or eliminate such accounting
consequence including, but not limited to:

                  (i)   increasing the Purchase Price for any Offering Period
including an Offering Period underway at the time of the change in Purchase
Price;

                  (ii)  shortening any Offering Period so that Offering Period
ends on a new Exercise Date, including an Offering Period underway at the time
of the Board action; and

                  (iii) allocating shares.

Such modifications or amendments shall not require stockholder approval or the
consent of any Plan participants.

      21.   Notices. All notices or other communications by a participant to the
Company under or in connection with the Plan shall be deemed to have been duly
given when received in the form and manner specified by the Company at the
location, or by the person, designated by the Company for the receipt thereof.

      22.   Conditions Upon Issuance of Shares. Shares shall not be issued with
respect to an option unless the exercise of such option and the issuance and
delivery of such shares pursuant thereto shall comply with all applicable
provisions of law, domestic or foreign, including, without limitation, the
Securities Act of 1933, as amended, the Exchange Act, the rules and regulations
promulgated thereunder, and the requirements of any stock exchange upon which
the shares may then be listed, and shall be further subject to the approval of
counsel for the Company with respect to such compliance.

            As a condition to the exercise of an option, the Company may require
the person exercising such option to represent and warrant at the time of any
such exercise that the shares are being purchased only for investment and
without any present intention to sell or distribute such shares if, in the
opinion of counsel for the Company, such a representation is required by any of
the aforementioned applicable provisions of law.

      23.   Term of Plan. The Plan shall become effective upon the earlier to
occur of its adoption by the Board of Directors or its approval by the
shareholders of the Company. It shall continue in effect until terminated under
Section 20 hereof.


                                      -10-
<PAGE>
                                                                    EXHIBIT 10.4


                                    EXHIBIT A


                                  NETGEAR, INC.

                          EMPLOYEE STOCK PURCHASE PLAN

                             SUBSCRIPTION AGREEMENT

_____ Original Application                             Offering Date:___________
_____ Change in Payroll Deduction Rate
_____ Change of Beneficiary(ies)


1.    ____________________ hereby elects to participate in the NetGear, Inc.
      Employee Stock Purchase Plan (the "Employee Stock Purchase Plan") and
      subscribes to purchase shares of the Company's Common Stock in accordance
      with this Subscription Agreement and the Employee Stock Purchase Plan.

2.    I hereby authorize payroll deductions from each paycheck in the amount of
      ____% of my Compensation on each payday (from 0 to [10]%) during the
      Offering Period in accordance with the Employee Stock Purchase Plan.
      (Please note that no fractional percentages are permitted.)

3.    I understand that said payroll deductions shall be accumulated for the
      purchase of shares of Common Stock at the applicable Purchase Price
      determined in accordance with the Employee Stock Purchase Plan. I
      understand that if I do not withdraw from an Offering Period, any
      accumulated payroll deductions will be used to automatically exercise my
      option.

4.    I have received a copy of the complete Employee Stock Purchase Plan. I
      understand that my participation in the Employee Stock Purchase Plan is in
      all respects subject to the terms of the Plan. I understand that my
      ability to exercise the option under this Subscription Agreement is
      subject to shareholder approval of the Employee Stock Purchase Plan.

5.    Shares purchased for me under the Employee Stock Purchase Plan should be
      issued in the name(s) of (Eligible Employee or Eligible Employee and
      Spouse only).

6.    I understand that if I dispose of any shares received by me pursuant to
      the Plan within 2 years after the Offering Date (the first day of the
      Offering Period during which I purchased such shares), I will be treated
      for federal income tax purposes as having received ordinary income at the
      time of such disposition in an amount equal to the excess of the fair
      market value of the shares at the time such shares were purchased by me
      over the price which I paid for the shares. I hereby agree to notify the
      Company in writing within 30 days after the date of any disposition of my
      shares and I will make adequate provision for Federal, state or other tax
      withholding obligations, if any, which arise upon the disposition of the
      Common Stock. The
<PAGE>
      Company may, but will not be obligated to, withhold from my compensation
      the amount necessary to meet any applicable withholding obligation
      including any withholding necessary to make available to the Company any
      tax deductions or benefits attributable to sale or early disposition of
      Common Stock by me. If I dispose of such shares at any time after the
      expiration of the 2-year holding period, I understand that I will be
      treated for federal income tax purposes as having received income only at
      the time of such disposition, and that such income will be taxed as
      ordinary income only to the extent of an amount equal to the lesser of (1)
      the excess of the fair market value of the shares at the time of such
      disposition over the purchase price which I paid for the shares, or (2)
      15% of the fair market value of the shares on the first day of the
      Offering Period. The remainder of the gain, if any, recognized on such
      disposition will be taxed as capital gain.

7.    I hereby agree to be bound by the terms of the Employee Stock Purchase
      Plan. The effectiveness of this Subscription Agreement is dependent upon
      my eligibility to participate in the Employee Stock Purchase Plan.

8.    In the event of my death, I hereby designate the following as my
      beneficiary(ies) to receive all payments and shares due me under the
      Employee Stock Purchase Plan:


      NAME: (please print)______________________________________________________
                          (First)             (Middle)         (Last)



      ____________________________          ____________________________________
      Relationship

      ____________________________          ____________________________________
      Percentage of Benefit                 (Address)

      NAME: (please print)______________________________________________________
                          (First)             (Middle)         (Last)



      ____________________________          ____________________________________
      Relationship

      ____________________________          ____________________________________
      Percentage of Benefit                 (Address)


                                      -2-
<PAGE>
         Employee's Social
         Security Number:                   ____________________________________

         Employee's Address:                ____________________________________

                                            ____________________________________

                                            ____________________________________


I UNDERSTAND THAT THIS SUBSCRIPTION AGREEMENT SHALL REMAIN IN EFFECT THROUGHOUT
SUCCESSIVE OFFERING PERIODS UNLESS TERMINATED BY ME.

Dated:_________________________             ____________________________________
                                            Signature of Employee

                                            ____________________________________
                                            Spouse's Signature
                                            (If beneficiary other than spouse)


                                      -3-
<PAGE>
                                                                    EXHIBIT 10.4

                                    EXHIBIT B

                                  NETGEAR, INC.

                          EMPLOYEE STOCK PURCHASE PLAN

                              NOTICE OF WITHDRAWAL

      The undersigned participant in the Offering Period of the NETGEAR, Inc.
Employee Stock Purchase Plan which began on ____________, ______ (the "Offering
Date") hereby notifies the Company that he or she hereby withdraws from the
Offering Period. He or she hereby directs the Company to pay to the undersigned
as promptly as practicable all the payroll deductions credited to his or her
account with respect to such Offering Period. The undersigned understands and
agrees that his or her option for such Offering Period will be automatically
terminated. The undersigned understands further that no further payroll
deductions will be made for the purchase of shares in the current Offering
Period and the undersigned shall be eligible to participate in succeeding
Offering Periods only by delivering to the Company a new Subscription Agreement.

                                            Name and Address of Participant:

                                            ____________________________________

                                            ____________________________________

                                            ____________________________________


                                            Signature:

                                            ____________________________________

                                            Date:_______________________________