EXHIBIT 10.3
Worldwide Stocking Distributor Agreement
BETWEEN
Fluid Handling Group
Entegris, Inc.
3500 Lyman Boulevard
Chaska, MN 55318
AND
Metron Technology N.V.
1350 Old Bayshore Highway
Suite 360
Burlingame, CA 94010
1. Appointment
Entegris, Inc. ("Entegris" or "we") hereby appoints Metron Technology
N.V., directly and/or through its subsidiaries, stocking distributor
(Metron Technology N.V. and its subsidiaries, "Distributor" or "you")
for the marketing and sale of those Entegris Fluid Handling Group gas
and liquid handling products set forth on Schedule A, attached.
2. Term
The term of this Agreement shall be for a period of 54 months
commencing March 1, 2001, and ending August 31, 2005, renewing
automatically for successive five-year terms thereafter unless
terminated by either party for cause, at anytime, as provided in
Section 13 hereof.If either party gives the other party written notice
of its intent to terminate this agreement at the end of the
then-current term no later than one year prior to the expiration date
of the then-current term, then this agreement shall not renew.
3. Area of Primary Responsibility
Your area of primary responsibility shall include regions of the United
States, Europe and Asia as specified in Schedule B, attached (the
"Territories"). Entegris hereby appoints Distributor as the exclusive
distributor of the products set forth on Schedule A in the Territories.
Entegris reserves the right to enter into direct relationships with
customers in the "Territories" without compensation to Distributor.
4. Entegris Obligations
(I) Entegris will make reasonable efforts to accomplish the following
on behalf of Distributor:
A. Deliver to you with reasonable diligence all products, price
lists and other literature reasonably required for performance
of your obligations under the Agreement.
B. Notify you of inquiries received by us from your primary area
of responsibility for our gas and liquid handling products.
C. Perform our duties within a reasonable time unless prevented
by circumstances beyond our control.
D. Conduct necessary training programs to aid Distributor's sales
personnel to better understand and market Entegris products.
E. Provide historical sales data by major product group and
industry as an aid in forecasting.
F. Prepare final plans and forecasts, and establish corrective
action plans if necessary (see section 6).
G. Provide semi-annual performance reports based on mutually
agreed upon criteria. Report timing is based on Entegris'
fiscal year, commencing September 1 of each year.
H. Work with the Distributor to implement the e-commerce support
strategy that is outlined in Schedule C, attached.
(II) During the term of this agreement, Entegris shall not, and shall
not permit any of its representatives to (i) hire any employee of Distributor or
(ii) directly or indirectly, personally or through others, encourage, induce,
attempt to induce, solicit or attempt to solicit any employee to leave his or
her employment with Distributor.
5. Distributor Obligations
You, as Distributor, represent and warrant to Entegris that you will:
A. Perform as a stocking distributor or manufacturer's
representative as specified below and use your best efforts to
stock, market and sell products within your Area of Primary
Responsibility.
B. Refer to us all inquiries received by you for the sale of the
products outside your Area of Primary Responsibility and
otherwise refrain from facilitation of sales through you
outside of your territory.
C. Not enter into any contracts or other commitments binding us
without our prior written consent.
D. Not make any representation or give any warranty relating to
the products other than those expressly stated in Entegris'
written sales documents. You will be exclusively liable for
any other representations and warranties and will indemnify
and hold Entegris harmless from any claims (including, without
limitation, Entegris' attorney fees) arising from any
unauthorized representations and warranties.
E. With reasonable notice make yourself available for instruction
or discussion as deemed necessary by Entegris.
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F. During the term of this Agreement you will refrain from
selling, and refrain from having any involvement or connection
with the sale of, any products or services competitive with
those of Entegris. Entegris shall be entitled to enforce the
provisions of this Section by a temporary restraining order
and temporary and permanent injunctions (collectively,
"specific performance").
G. Not make any purchase on our behalf or pledge our credit.
H. Sell our products under the Entegris(R), Inc. label.
I. Keep your account current: Net 30 days from date of invoice.
If during a quarter the Distributor becomes delinquent in its
payment to Entegris, without approval, the Distributor will be
subject to a discount penalty. The penalty will be calculated
as a 2% reduction in the Distributor's discount for all of
Distributor's purchases during the subsequent quarter
("subsequent quarter"). If at the end of the subsequent
quarter the Distributor's payment performance is current, the
standard discount will be reactivated for the next succeeding
quarter. If Distributor's account is not brought current by
the end of the subsequent quarter, the Distributor may be
terminated immediately.
J. Report Distributor sales monthly. Reports must be submitted to
Entegris on or before the 20th day of the subsequent month.
Subject to Entegris' right to revise the reporting
requirements at any time, the reports will contain the
following information for each of Distributor's customers:
ship-to address; part number; and quantity for each customer.
K. Report inventory values monthly, submitted to Entegris by the
20th day of the subsequent month, and reported on a
Distributor cost basis.
L. Work with Entegris to develop and update on a quarterly
schedule an eight (8) quarter rolling forecast. Forecasts are
to be based on Distributor cost.
6. Distributor Corrective Action Program
If following the semi-annual evaluation Distributor's performance does
not meet an acceptable performance level in relation to the semi-annual
performance reports based on mutually agreed upon criteria contemplated
by Section 4.G above, the Distributor will be notified. In the quarter
following this notification, an evaluation of the Distributor's
performance will be performed and if it still does not meet the
performance standard, the Distributor will participate in a corrective
action plan.
In the first phase of corrective action the Distributor meets with
Entegris sales territory manager to evaluate areas of unsatisfactory
performance and to create a plan to meet or exceed the performance
shortfalls. The plans must be developed and implemented within three
months of initial notification.
In the second phase the Distributor performance is monitored against
the corrective action plan for six (6) months. If performance improves
and meets the agreed upon performance levels in all material respects
by the end of six (6) months, the Distributor returns to normal status.
If at the end of six (6) months a Distributor does not meet in a
material respect the agreed upon performance levels, Entegris has the
right to extend the corrective action program or terminate the
relationship with the Distributor.
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Following satisfactory completion of a corrective action program and
meeting the agreed upon performance standard, continued performance
above the performance standard for two (2) years without further
corrective action is expected and failure to meet the agreed upon
performance standard during any six month period within that two-year
period shall result in immediate termination of the Distributor.
The Distributor corrective action program will be enforced on a
regional level. Distributor branch or country locations may be put on
corrective action and terminated for non-performance without effecting
the remaining Distributor locations covered by this agreement.
7. Prices
A. Entegris agrees to sell Entegris(R), Inc. products to you as a
distributor at the discounts from published list price as
indicated on Schedule D attached hereto. All prices are based
on delivery FOB Entegris factory. Notwithstanding, Entegris
shall have the right to retain title to the products and bear
the risk of loss until delivery FOB at the Distributor's
warehouse (or the place of acceptance by the Distributor's
customer). In any event, the Distributor (or the Distributor's
customer) shall, directly or indirectly, bear the cost of any
customs, duties, taxes, shipping, handling and insurance with
respect to the shipment of the products.
B. Entegris agrees that you shall have the right to establish the
final selling prices to your customers on all sales negotiated
by you as a stocking distributor. Entegris maintains the right
to establish final selling prices on all sales where the
Distributor is acting as a manufacturer's representative as
provided in Section 12.
C. Entegris may change: (a) any published list prices by giving
the Distributor at least thirty (30) days written notice of
said changes; or (b) any terms of Schedules A-H (attached)
with a twelve (12) month written notice or written agreement
by both parties at any time.
8. Order Requirements and Information
A. Minimum order value is net $100.00, unless an alternate
agreement is made with Entegris sales management when an order
is placed.
B. Rush orders are defined as those where the request is for same
day or next day shipment from Entegris. It is the
Distributor's responsibility to minimize these requests.
C. Drop shipments are defined as orders shipped directly from
Entegris to the Distributor's customers. Drop shipments will
earn normal discounts less 10%, unless an alternate agreement
is made with Entegris sales/regional management prior to the
shipment.
D. UPS and all other shipping charges incurred by Entegris for
any rush orders or drop shipments will be prepaid by Entegris,
added to the Distributor's invoice and reimbursed to Entegris.
9. Inventory Exchange
A. At the introduction of each new product, the potential for a
future inventory exchange will be addressed. Qualifying new
product, displaced product, if any, and the time period for
the exchange will be defined. A maximum of five percent (5%)
of the total combined sales of the new and displaced products
during the specified time period can be returned.
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B. Entegris will accept a yearly inventory return from each
Distributor region (U.S., Europe and Asia) that amounts to 3%
of the respective regions total purchases from Entegris for a
twelve (12) month period per the following schedule:
U.S. - July 1st to June 30th
Europe - May 1st to April 30th
Asia - March 1st to February 28th
These returns must have a valid Return Authorization Number
and be completed within 30 days from the end of the twelve
(12) month period in question.
C. Inventory being returned must have a Return Authorization
Number. All items must be in resalable condition, unused, in
the original packaging and of current revision level. A
packing list showing part numbers, quantities and the Return
Authorization Number must accompany returned inventory.
D. A credit memo will be issued for the exchange. The credit
allowance will be the maximum Distributor discount for each
product from the previous year's published price.
E. A purchase order must be entered before or at the same time of
the exchange.
F. The dollar amount of the purchase must be within $100.00 of
the credit allowance.
G. The Distributor will pay all freight charges.
10. Return for Repair Policy Procedures
A. Products returned for repair must be issued a Return
Authorization Number prior to shipping. Products returned
without an approved Return Authorization will not be accepted.
B. Defective products that are within Entegris' written warranty
period for that specific product will be replaced or repaired
by Entegris.
C. Products that have been altered or tampered with in any way
will void the warranty. Entegris reserves the right to refuse
service on any such part.
D. The return of products that have been exposed to hazardous
media must be approved by Entegris and a Entegris return tag
must be completed prior to product return. Entegris may
require that the product(s) be cleaned and neutralized to
Entegris' satisfaction or service may be refused.
11. Return for Credit
A. Full product credit will be issued on return if Entegris made
a product or shipping error. Freight charges for returning the
shipment will be paid by Entegris.
B. There will be a restocking charge of twenty-five percent (25%)
of the Distributor's purchase price on all resalable items
returned for credit when Distributor has made an order error.
Shipping charges to be paid by Distributor when Distributor
has made an order error. Charges on collect return will be
deducted from the allowable credit.
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C. All items must be in resalable condition, unused, in the
original packaging and of the current revision level.
D. Claims for shortages or inaccurate filling of orders must be
made to Entegris within ten (10) days after receipt of
shipment.
E. Returned goods will be accepted only with prior approval and
Return Authorization Number.
F. Goods ordered through a Distributor and returned to Entegris
by the end-user will not be accepted without prior approval.
12. Manufacturer's Sales Representative Role
A. Entegris may ask you to act as a manufacturer's sales
representative ("manufacturer's representative") instead of as
a stocking distributor in order to obtain or maintain a
specific customer's business for certain Fluid Handling Group
products. In such cases, Entegris shall provide a commission
structure for sales credited to you in your capacity as a
manufacturer's representative. Commission will be paid in the
form of a credit memo on paid invoices.
B. Billing and shipping will occur between the customer and
Entegris. The manufacturer's representative role will include,
but not be limited to, local sales and support.
13. Termination
A. This Agreement can be terminated by Entegris immediately upon
written notice if:
1) You attempt to assign or subcontract this Agreement
or rights or obligations hereunder without prior
written consent of Entegris.
2) There is a change in the control of Distributor which
is unacceptable to Entegris.
3) You cease to function as a going concern or cease to
conduct operations on behalf of Entegris in the
normal course of business.
4) You encounter serious financial difficulty, which
materially affects your performance under this
Agreement.
5) Entegris receives information that you may be unable
to perform this Agreement in all material respects
and you do not provide Entegris adequate proof of
your ability to perform in all material respects
within 30 days after written notice from Entegris.
6) You misrepresent in a material respect a sales
agreement or sales report, or sell a material amount
of samples.
7) You engage in activity which violates in a material
respect any of your obligations under Section 5.
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8) You fail to keep your account current or cease to
make payment to Entegris or fail to pay the balance
due on your account immediately upon receipt of a
second written warning of failure to pay.
9) You fail to pay the balance due on your account
promptly upon receiving late payment notice as part
of any quarterly evaluation.
B. This Agreement may otherwise be terminated by Entegris
according to the corrective action plan referred to in Section
6 .
C. In the event of termination by Entegris under Section 13.A or
13.B or as a result of any other material breach of this
agreement by Distributor (collectively, "breach"), Distributor
agrees: (1) to pay Entegris all damages arising from the
breach and all reasonable attorney fees, costs and
disbursements incurred by Entegris in enforcing its rights
under this Agreement; and (2) that it will not, for a period
of two years following the effective date of the breach or
termination (whichever is later), represent any manufacturer
of products competitive with Entegris, and that it will not
sell, or have any material involvement or connection with the
sale of, any products competitive with those of Entegris.
Entegris shall be entitled to enforce the provisions of this
Section by specific performance.
D. If Entegris terminates this agreement for any reason other
than pursuant to Section 13.A or 13.B or as a result of any
other material breach of this agreement by Distributor, the
parties agree that the actual damages resulting from the
breach are not readily ascertainable and that Entegris will
pay the Distributor the following amount as liquidated damages
in lieu of any other damages or remedies: for two (2) years
commencing on the effective date of termination, Entegris will
pay the Distributor a commission of ten percent (10%) of all
sales of Entegris products in the Distributor's territory
during the two-year period of the Entegris products set forth
on Schedule A hereto as of the date of the event giving rise
to the termination. The commission shall only be paid on the
same Entegris products which the Distributor sold within the
territory during the twelve (12) months prior to the
termination. The commission payable under this clause 13.D
shall be based exclusively on the price Entegris charges its
next distributor or on standard Entegris distributor cost for
such products (after subtracting any discounts, credits or
awards) and shall not include any other customary charges,
including without limitation taxes, transportation, storage
and returns. This commission shall be payable on a quarterly
basis within thirty (30) days after the date of any quarter
during such two-year period. The parties agree that the remedy
provided in this Section 13.D is not a penalty.
E. Upon receipt of written notice of termination covered by the
provisions in this section 13, Distributor will have 60 days
to cure the breach to the satisfaction of Entegris before the
termination becomes effective.
F. If Entegris makes material changes in this agreement pursuant
to Section 7.C paragraph(b) hereof without the written consent
of Distributor or Entegris materially breaches this agreement,
Distributor shall have the right to terminate this agreement
immediately upon written notice, and Distributor will not be
bound by the two (2) year non-competition agreement set forth
elsewhere in this agreement.
14. Rights upon Termination
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A. On termination of this Agreement, for any cause whatsoever, it
is hereby expressly agreed that Entegris shall deliver against
all Distributor orders previously accepted subject to payment
on delivery and will negotiate all outstanding credit memos
with Distributor.
B. If Entegris should terminate this Agreement or Distributor
should terminate this agreement as a result of material breach
of this agreement by Entegris or the making by Entegris of
material changes to this agreement pursuant to Section 7.C
paragraph (b) hereof without the written consent of
Distributor, all stock may be returned for full credit
provided it is in resalable condition, unused, in the original
packaging and of current revision level. If the distributor
terminates the Agreement other than as a result of material
breach of this agreement by Entegris or the making by Entegris
of material changes to this agreement pursuant to Section 7.C
paragraph (b) hereof without the written consent of
Distributor, Entegris is not responsible for taking back
stock.
15. Confidentiality
A. Any information provided between Entegris and Distributor
which the provider deems confidential or proprietary shall be
labeled as such at the time of disclosure if the disclosure is
written, or if verbal, shall be confirmed in writing as
confidential within thirty (30) days after disclosure. The
receiving party shall treat such information in confidence and
shall take reasonable and customary steps to assure that such
information is not shared with any third party. Information
shall not be confidential if it is already known to recipient
at the time of disclosure or recipient otherwise learns of it
via a third party that is free to disclose it without
obligation. These obligations shall remain in effect during
the term of this Agreement and for a period of two (2) years
thereafter.
B. If the parties have signed any other non-disclosure or
confidentiality agreements, the terms of such agreements shall
supplement the terms of this agreement.
C. All reports and documentation supplied to Entegris by the
Distributor pursuant to the requirements of Section 5.J-L
shall be considered confidential and shall be subject to the
confidentiality obligations identified in the paragraph above.
16. Modification
A. Except as provided in Section 7.C of this Agreement, this
Agreement may only be modified in writing, signed by the
Distributor and Entegris.
17. Merger
A. This Agreement incorporates the full understanding of the
parties and replaces in its entirety any and all prior
understandings relating to distribution rights and any other
contracts or obligations between the parties. There are no
other agreements between the parties except as stated herein,
all such prior or other agreements being merged into this
Agreement.
B. If Entegris waives any breach by this Distributor (or any
other distributor), such waiver shall not constitute a waiver
of any subsequent breach by this Distributor (or any other
distributor).
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18. Governing Law
A. This Agreement shall be interpreted under the laws of the
State of Minnesota.
ENTEGRIS, INC.
Signed /s/ Stan Geyer Dated March 1, 2001
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Stan Geyer
Chairman
Entegris, Inc.
METRON Technology N.V.
Signed /s/ Greg Claeys Dated February 28, 2001
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Greg Claeys
Vice President - Materials Group
Metron Technology N.V.
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