Exhibit 10.16
CONTRACT MANUFACTURING AGREEMENT
This Contract Manufacturing Agreement (this "Agreement") is entered into as
of March 31, 2001, between Millipore Corporation ("Millipore"), a Massachusetts
corporation with its principal place of business at 80 Ashby Road, Bedford, MA
01730, and Mykrolis Corporation ("Mykrolis"), a Delaware corporation with its
principal place of business at Patriots Park, Bedford, MA 01730.
RECITALS
1. Millipore currently owns all of the issued and outstanding common
stock of Mykrolis.
2. Millipore and Mykrolis have entered into a Master Separation and
Distribution Agreement as of March 28, 2001 (the "Master Agreement") under
which, among other things, the business of Millipore's Microelectronics Division
is to be taken over by, and the assets and liabilities associated therewith are
to be transferred to and assumed by, Mykrolis at the Separation Date (as defined
in the Master Agreement).
3. After the Separation Date, in order to enable Mykrolis to carry on its
respective business as a separate company, Mykrolis wishes that Millipore, on a
contract manufacturing basis, supply the product (or products) listed on Exhibit
A (the "Product") to Mykrolis, and Millipore wishes to do so.
4. The Master Agreement provides for this Agreement to be entered into as
of the Separation Date.
NOW, THEREFORE, in consideration of the foregoing and the covenants and
agreements set forth below, the parties hereto agree as follows:
1. Definitions. Capitalized terms defined in this Agreement shall have the
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respective meanings assigned to them at the location of their definition.
Capitalized Terms used in this Agreement without definition which are defined in
the Master Agreement shall have the meaning ascribed thereto in the Master
Agreement.
2. Overriding Character of this Agreement
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A. Unless otherwise agreed by both parties in writing, this Agreement
applies to all purchase releases, purchase orders and other documents
of purchase for the Products (hereinafter collectively referred to as
"Releases") which Mykrolis may place with Millipore during the term of
this Agreement. The terms and conditions of this Agreement shall
apply to any Releases, whether or not this Agreement or its terms and
conditions are expressly referenced in the Release.
B. Unless otherwise agreed by both parties in writing for a specific
transaction, no inconsistent or additional term or condition in any
Release shall be applicable to a transaction within the scope of this
Agreement. Both parties specifically agree that any term and
condition on any of their purchase or sale documents used as Releases
hereunder which are in any way inconsistent with this Agreement shall
be inapplicable, and the terms of this Agreement shall govern.
3. Supply of Product
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(a) Millipore agrees to sell to Mykrolis, from time to time during the
Term, Product, in the amounts contained in Mykrolis's Releases.
Except as set forth in Section 6(a) hereof, Mykrolis shall have no
minimum or maximum purchase requirements for the Products.
(b) Millipore agrees to manufacture and package the Products in accordance
with the specifications therefor in effect as of the Separation Date.
In addition, Millipore agrees to label and otherwise mark the Products
and the packaging for the Products with Mykrolis's trademarks and
trade names in accordance with artwork specified by Mykrolis. Except
as otherwise expressly agreed, Mykrolis agrees that it shall not
resell the Products under any Millipore trademark or trade name.
4. Term and Termination
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(a) The effective period of this Agreement (the "Term") shall begin on the
Separation Date and continue thereafter for a period of five (5) years
or until earlier termination in accordance with clause (b) or (c) of
this Section 4. Any Release issued by Mykrolis before the effective
date of termination and in accordance with Section 6(a) hereof shall
be fulfilled by Millipore.
(b) Either party may terminate this Agreement prior to the expiration of
the Term without prejudice to any rights or liabilities accruing up to
the date of termination:
(i) in the event of a material breach by the other party of any of
the terms and conditions of this Agreement, by giving the other
party notice of such breach, and provided that such breach shall
not have been cured, or material steps to effect a cure
undertaken within sixty (60) days following such notice; and
(ii) immediately, by written notice thereof, if any of the following
events or an event analogous thereto occurs:
a. an adjudication has been made that the other party is
bankrupt or insolvent;
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b. the other party has filed bankruptcy proceedings or has had
such proceedings filed against it, except as part of a bona
fide scheme for reorganization;
c. a receiver has been appointed for all or substantially all
of the property of the other party;
d. the other party has assigned or attempted to assign this
Agreement for the benefit of its creditors; or
e. the other party has begun any proceeding for the liquidation
or winding up of its business affairs.
(c) Mykrolis may terminate this Agreement effective at any time, provided
it has given Millipore at least sixty (60) days prior written notice
thereof.
(d) Termination under this Section 4 shall be in addition to and not a
substitute for other rights or causes of action of the terminating
party.
5. Price
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(a) For the first year of this Agreement, the price shall be as set forth
on Exhibit A, which is attached and incorporated by reference.
Thereafter, Millipore shall be entitled to adjust prices annually on
each anniversary of the Separation Date in order to recoup actual
increases in the cost to manufacture the Products. Millipore agrees
to justify any price increases hereunder by an open-book review of its
costs with Mykrolis.
(b) Prices and deliveries will be FOB the Millipore plant which is
producing the Product.
6. Orders, Delivery and Payment
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(a) Mykrolis will provide Millipore with a rolling one year forecast of
its demand for Product hereunder (a "One-Year Forecast") which will be
updated on a quarterly basis, at least thirty (30) days prior to the
start of each calendar quarter. Each such One-Year Forecast shall
include a sub-forecast for the first three months within the One-Year
Forecast (a "3 Month Forecast"). Mykrolis shall provide Releases for
delivery, during the three months covered by such 3 Month Forecast, in
the quantities specified therein, but subject to increase or reduction
in such quantities of not more than 25%. Except for such purchase
commitment in the 3 Month Forecasts, the One-Year Forecasts will be
used for planning purposes only and are not binding. Millipore will
ship Product so as to arrive on the delivery date set forth in a
Release, provided that the delivery date
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set forth in such Release is not less than 30 days following the date
Millipore receives such Release and provided that the amounts set
forth in such Release are within the range provided above in
accordance with the applicable 3 Month Forecast.
(b) Mykrolis shall make payment to Millipore within forty-five (45) days
after the later of (i) receipt of the Product, and (ii) receipt of
Millipore's invoice for the Product. All payments shall be made in
U.S. Dollars. Late payments shall bear interest at a rate of 12% per
annum.
(c) All Product shall be tested, inspected and packaged for delivery by
Millipore as mutually agreed by the parties.
(d) Millipore shall make reasonable best efforts to ship the Product in
accordance with the requested delivery dates. Millipore shall give
prompt notice of any delay in shipment and shall use diligence to
remove the cause of any such delay, provided, however, that Millipore
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accepts no liability for general, special, or consequential damages
arising out of delay in delivery.
(e) Identification of the Products to this Agreement shall occur when they
are packed for shipment, addressed to Mykrolis and delivered to a
common carrier, at which time title and risk of loss shall pass to
Mykrolis. In the event that any shipment of Products or any portion
thereof fails to conform to the applicable specifications, then
Mykrolis shall be entitled to reject such shipment of Products or the
portion thereof that fails to so conform, as the case may be.
Mykrolis shall communicate its rejection hereunder by written notice,
given within twenty (20) days following the date on which such
shipment was received by Mykrolis, specifying the grounds for such
rejection. If no written notice of rejection is given by Mykrolis
within said twenty (20) day period, the Products shall be deemed to
have been accepted, and to have conformed to the applicable
specifications. In the event of any proper and timely rejection,
Millipore agrees: (i) that it shall bear the cost of shipment for the
return of rejected Products and (ii) to use its reasonable best
efforts to cure such rejection or replace such nonconforming Products
within thirty (30) days after receipt of written notice thereof.
7. Special Covenants.
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(a) Millipore agrees that the Products are exclusively Mykrolis Products
and that Millipore agrees that neither it nor any of its Subsidiaries
shall manufacture, market or sell the Products to any person other
than Mykrolis or its Subsidiaries. Notwithstanding the above, if any
Product is covered by the Product Distribution Agreement entered into
by Millipore and Mykrolis
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pursuant to the Master Agreement, then Millipore may distribute that
Product as per the terms of such Product Distribution Agreement.
(b) Mykrolis agrees that neither it nor any of its subsidiaries will (i)
sell the Product into the Millipore Core Business, or (ii) grant any
distributor, OEM manufacturer or other third party the right or permit
any of them to sell the Products into the Millipore Core Business
8. Warranties
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Millipore Corporation ("Millipore") warrants the Products will be free
from defects in materials and workmanship when used in accordance with the
applicable instructions for a period of one year from shipment of the
Products. MILLIPORE MAKES NO OTHER WARRANTY, EXPRESSED OR IMPLIED. THERE
IS NO WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE. The
warranty provided herein and the data, specifications and descriptions of
Millipore products appearing in Millipore's published catalogues and
product literature may not be altered except by express written agreement
signed by an officer of Millipore. Representations, oral or written, which
are inconsistent with this warranty or such publications are not authorized
and if given, should not be relied upon.
In the event of a breach of the foregoing warranty, Millipore's sole
obligation shall be to repair or replace, at its option, the applicable
Product or part thereof, provided Mykrolis notifies Millipore promptly of
any such breach. If after exercising reasonable efforts, Millipore is
unable to repair or replace the Product or part, then Millipore shall
refund to Mykrolis all monies paid for such applicable product or part.
MILLIPORE SHALL NOT BE LIABLE FOR CONSEQUENTIAL, INCIDENTAL, SPECIAL OR ANY
OTHER INDIRECT DAMAGES RESULTING FROM ECONOMIC LOSS OR PROPERTY DAMAGE
SUSTAINED BY ANY CUSTOMER FROM THE USE OF ITS PRODUCTS.
9. Product Modifications
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Millipore agrees that it will not materially change the Product that it
will supply hereunder or their formulation, manufacturing or testing
processes, process equipment, other aspects of form, fit or function, or
production location, unless Mykrolis approves such change in writing, which
approval may require formal validation and qualification and possibly
customer notification. The implementation of any such accepted changes
shall be subject to the parties' agreement on any change in price or other
terms of supply as may be necessitated or requested by a party as a result
of such change.
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10. Inventory
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Millipore will maintain an inventory of Product, in such amounts as shall
be agreed by the parties but in no event less than amounts specified in
Mykrolis's current 3 Month Forecast.
11. Access to Facilities
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At any time during the Term, upon reasonable advance notice by Mykrolis,
Mykrolis's authorized representatives and customers (subject to appropriate
confidentiality obligations) shall be provided access to the facilities of
Millipore to audit or verify conformity of Product manufacture to
specifications.
12. Notices
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Any notice or other communication required or permitted to be given by
either party pursuant to the terms of this Agreement shall be in writing
and shall be deemed given if and when delivered by hand or sent by
certified mail, return receipt requested, overnight courier, confirmed
telecopy, or confirmed electronic mail transmission, addressed as follows:
If to Millipore: Millipore Corporation
80 Ashby Road
Bedford, MA 01730
Attn:Vice President, Manufacturing
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Fax: [(781)__________]
with a copy to: Millipore Corporation
80 Ashby Road
Bedford, MA 01730
Attn: General Counsel
Fax: (781) 533-3125
If to Mykrolis: Mykrolis Corporation
Patriots Park
Bedford, MA 01730
Attn:Vice President, Manufacturing
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Fax: [(781) ________]
with a copy to: Mykrolis Corporation
Patriots Park
Bedford, MA 01730
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Attn: General Counsel
Fax: (781) _________
or to such electronic mail address as may be specified by an addressee
party to the other party by one of the other means provided above, or to
such other address, telecopy number or electronic mail address as may be
specified by an addressee party to the other by one of the means provided
above.
13. Force Majeure
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The obligations of a party under this Agreement will be suspended to the
extent that it is wholly or partially precluded from complying with its
obligations under this Agreement by force majeure. Force majeure includes,
but is not restricted to, fire, storm, flood, earthquake, explosion,
accident, act of the public enemy, war, rebellion, insurrection, sabotage,
epidemic, quarantine restriction, labor dispute, labor shortage,
transportation embargo or failure or delay in transportation, act of God,
act (including laws, regulations, disapprovals or failure to approve) of
any government agency, whether national, municipal, or otherwise. The
parties shall be relieved of their respective obligations hereunder, to the
extent that the performance of such obligation was actually prevented
thereby. During the existence of any such condition, the affected party
shall, nevertheless, use its best efforts to remove the cause thereof.
14. No Other Rights
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Neither party shall have any rights hereunder to any patents or other
intellectual property of the other party, except as specifically set forth
herein.
15. Incorporation of Provisions from Master Agreement
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The following provisions of the Master Agreement, mutatis mutandis, are
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hereby incorporated by reference into this Agreement for all purposes:
Article VI (Confidentiality);
Article IX (Dispute Resolution);
Section 10.3 (Governing Law);
Section 10.6 (Counterparts);
Section 10.7 (Binding Effect; Assignment);
Section 10.8 (Severability);
Section 10.9 (Failure or Indulgence Not Waiver;
Remedies Cumulative);
Section 10.10 (Amendment);
Section 10.11 (Authority);
Section 10.12 (Interpretation).
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In the event of any conflict between any of the foregoing incorporated
provisions of the Master Agreement and any other provision of this
Agreement, such other provisions shall prevail.
16. Entire Agreement
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This Agreement, including Exhibit A attached hereto, is the entire
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agreement between the parties with respect to the subject matter hereof,
and supersedes any prior negotiations and agreements or understandings and
any contemporaneous oral agreements or understandings with respect to the
subject matter hereof.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their duly authorized representatives effective as of the date first
set forth above.
MILLIPORE CORPORATION MYKROLIS CORPORATION
By: /s/ Francis J. Lunger By: /s/ Jean-Marc Pandraud
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Name: Francis J. Lunger Name: Jean-Marc Pandraud
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Title: Executive Vice President Title: President
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EXHIBIT A: Product and Prices
Products: . Fluorogard cartridges with sales during the previous two years
before the effective date of this Agreement.
From Bedford Molding:
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. 16908 Slipper
. 40640 ILM
. 41641 ILM
. 42172 HF Top Cap
. 42173 HF Bottom Cap
. 43014 LHVD Hsg Bowl
. 43015 LHVD Hsg Head
. 95977 CMP End Cap
. 95978 CMP End Cap
. 95979 CMP End Cap
. 108318 CMP Slipper
. 108184 LHVD Potting Disk
. 108488 Solaris C-ring
. 108489 Solaris Solid Ring
. 108995 Filter Guide
. 108996 Filter Guide
. 108997 Pivot
. 108998 Latch Slide
. 108999 Release Tab
From Jaffrey Molding:
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. 12596X2 Halar disk
. 15051 1/4" VCR protective cap
. 15050 3/8" VCR protective cap
. 12597 Endcap
. 12598 Endcap
. 15122X1 WWFG 1" Dustcap (red)
. 15122X2 WWFG 1" Dustcap (clear)
. 16946X PFA cap CD 0
. 15121X2 Mini-WWFG dustcap
. 12747 Endcap
. 13290 Adapter Dbl o-ring
. 95894 Housing inlet cap
. 95895 Housing outlet cap
. 16040 Hsg outlet 1/4 NPTF
. 16041 Hsg outlet 1/2 NPTM
. 16042 Hsg inlet 1/4 NPTF
. 16043 Hsg inlet 1/2 NPTM
. 15411X2 Dust cap clear WWFG
. 12797 Caplug NPT Wafergard
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. 15315 Int o-ring adapt Halar
. 43014 LHVD IntelliGen Hsg bowl
. 43015 LHVD IntelliGen Hsg head
. 108491 Solaris end cap
Other BioP Assemblies Used In MiE Products:
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. 108898X3 Pegasus Subassy
. 108898X7 Pegasus Subassy
. 108898X8 Pegasus Subassy
. 12676 Slit Patapar
. 95049 Chempure Pleated Cart
. 12418 Cartridge Wafer-6 w/2-012
. Molsheim Engineering Filter Housing's
Engineered assembly equipment for
Systems microelectronics applications*
Plant
Initial Price
for All Products: Millipore Standard Cost as of the effective date of this
Agreement as set forth in Millipore's Oracle System, plus
ten percent of such standard cost.
* Because this Product is not an exclusively Mykrolis product, Section 7(A) of
this Agreement does not apply with respect to this Product.
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