Collaboration And Oem Agreement

Exhibit 10.3


MALDI-TOF Mass Spectrometry


Collaboration and OEM Agreement


between


PerkinElmer Instruments LLC and its Affiliates ("PKI")


and


Bruker Daltonics Inc. and its Affiliates ("BDAL")


1. BACKGROUND


o PKI wishes to offer and distribute a MALDI-TOF system to its North
American pharmaceutical, biotech, food and chemical industry customers, as
well as to certain international markets by Q2-2000.


o PKI requires a high-quality MALDI-TOF for a diverse range of customer
applications from a supplier with a strong reputation.


o PKI has particularly strong distribution channels into pharmaceutical and
food QA/QC, pharma/biotech and chemical manufacturing, pharma/biotech drug
development, pre-clinical and clinical trials.


o PKI also has international distribution strength in certain markets where
BDAL is not well established, e.g. Latin America, Italy, Eastern Europe,
Israel, India;


o If PKI rolls out a MALDI-TOF, it intends to sell such a product in
significant numbers. Eventually, PKI wishes to sell such a product
globally.


o Based on the performance, automation and quality of its systems, BDAL has
recently become the leading MALDI-TOF company for high-end research
applications in proteomics, PKIs, and drug discovery.


1


o BDAL has significant MALDI-TOF sales into universities, medical schools,
government research labs, and pharma/biotech research and drug discovery
labs.


o BDAL presently does not have strong distribution into industrial QA/QC,
manufacturing, clinical trials, and drug development, and BDAL does not
have complete international distribution coverage


o At Pittcon 2000, BDAL will introduce a high-performance, bench-top,
PC/NT-driven MALDI-TOF system called OmniFLEXT(TM). This new product has
very good performance/price ratio compared to otherbench-top MALDI-TOFs on
the market. It is arguably "the first bench-top MALDI-TOF worth buying".
The OmniFLEX also features an attractive industrial design, and a well
thought-out intuitive GUI.


2. OBJECTIVE


PKI and BDAL wish to enter into a strategic alliance in MALDI-TOF mass spectrometry. In particular, PKI and BDAL wish to collaborate on the distribution of BDAL's linear bench-top OMNIFLEXTm MALDI-TOF system via PKI's international distribution system.


3. TERM AND NON-COMIPETE CLAUSE


Once signed by both parties this Agreement shall initially be valid until Dec. 31, 2001 ("Phase I"). If both PKI and BDAL are satisfied with Phase I of this Agreement, and if and when the numerical targets agreed to herein for Phase I have been reached, then this Agreement shall be automatically extended to Dec. 31st , 2003 ("Phase 2"). Thereafter, this Agreement is renewable for additional two-year periods by mutual written consent.


2


During the Term of this Agreement, and, except as described below, for one (1) year following the expiration or termination of this Agreement, PKI will not develop, manufacture, offer to sell, sell or deliver any other benchtop MALDI-TOF system comparable to the OmniFLEX, i.e. in the selling price range between $80,000 to $140,000, and not built by BDAL, unless BDAL cannot deliver systems without sustained, substantial and non-solvable delivery or quality problems which negatively impact PKI's ability to sell the OmniFLEX.


Any MALDI-TOF system manufactured and/or sold by Genomic Solutions Inc. as part of a complete proteomics solution (presently called Investigator(TM) proteomics solution) via PKI or other sales channels shall be specifically excluded from this non-compete clause. Also, this non-compete clause shall not apply if PKI acquires an instrument company with a MALDI-TOF product line if that line represents less than 30% of the acquired company's business. Finally, this non-compete clause shall not apply if BDAL is not willing to sell and deliver OmniFLEX systems to PKI, for example by refusing to extend this Collaboration into a Phase 2 (see below), even though PKI may have achieved the minimum quantities of Phase I (see below).


4. PRODUCT DEFINITION & CO-LABELLING


The mass spectrometer that may be resold by PKI as an authorized OEM-dealer for BDAL is a linear OMNIFLEX(TM) MALDI-TOF, as described in Attachment A, which will meet the specifications contained in Attachment B. PKI may also resell additional BDAL MALDI-TOF accessories, such as MAP(TM) MALDI AutoPrep robots, AnchorChip(TM) high-sensitivity targets, various post-processing software packages, and MALDI-TOF consumables (collectively the "Accessories"), which are described on


3


BDAL's standard U.S. MALDI-TOF price list from time to time. The linear OmniFLEX system to be sold by PKI will be co-labeled with both, equally-sized PKI and BDAL decals on the system.


If, during the term of this Agreement BDAL introduces a system that replaces or supersedes the OmniFLEX or introduces new Accessories, BDAL will sell such products to PKI under the terms of this Agreement.


PKI is specifically not authorized to sell the reflector version of the OmniFLEX. If a research customer absolutely needs a reflector OmniFLEX system from the beginning, then PKI will pass this customer lead on to BDAL. The only exception to this policy is that PKI upon specific request by its linear OmniFLEX customer, may sell the reflector upgrade to PKI linear OmniFLEX customers who have accepted their PKI-purchased linear OnmiFLEX more than twelve (12) months before those customers request an upgrade. The transfer price to PKI will be the BDAL U.S. list price minus a 10% finders' fee for PKI. BDAL will install the reflector upgrade, and provide a limited 90-day warranty on the reflector upgrade. Moreover, PKI agrees not to incentivize its sales force or product manager for reflectron upgrades sold via PKI to its customer base of linear OmniFLEX customers.


For customer leads passed from PKI to BDAL which result in an accepted purchase order for a reflectron OmniFLEX, or a reflectron upgrade, to BDAL, BDAL will pay PKI a 5% finder's fee of the purchase order net amount, provided that PKI played a significant and substantial role in assisting BDAL with the systems sale (i.e. this would apply if a joint sales call took place, but it would not apply for passing on lists of potential customers, unqualified general leads, etc.).


4


It is understood that BDAL itself will also continue to sell the OmniFLEX, including a version with an optional reflector, and nothing contained in this Agreement shall prevent BDAL from selling or distributing its OmniFLEX system also via additional third-party distribution channels in the future.


PKI and BDAL agree that on-time deliveries and high quality are important for the success of this Collaboration. If repeated substantially late deliveries and major quality problems arise, PKI and BDAL will try to resolve these issues mutually. If BDAL cannot deliver OmniFLEX systems to PKI without sustained, substantial and non-solvable delivery or quality problems which negatively impact PKI's ability to sell the OmniFLEX, then PKI can terminate this Agreement with one hundred twenty (120) days written notice, including a ninety (90) day period during which BDAL is afforded an opportunity to fix the delivery or quality problems.


5. INTRODUCTION AND PHASE 1


PKI and BDAL intend to announce their strategic alliance and simultaneously introduce the OmniFLEX at Pittcon 2000 on March 13th, 2000. BDAL will loan an OmniFLEX shell or system to PKI for Pittcon 2000. If PKI can provide paint color requests and decals to BDAL very soon, then BDAL will make a best effort to have a co-labeled OmniFLEX shell or system in the PKI selected colors at the PKI booth at Pittcon.


This strategic alliance will be announced in a joint mutually agreeable press release, which will initially be drafted by PKI.


5


For Phase 1 of this Agreement until Dec. 31st, 2001, PKI with the signing of this Agreement places a firm, fixed minimum order with BDAL for [*](1) systems to be delivered to PKI at a minimum rate of [*] per month for July-October 2000, and going up to [*] per month for the thirteen month period between November 2000 and November 2001, for a minimum total of [*] systems. This order shall be accompanied by a non-refundable down-payment of forty percent (40%) of the total order value, i.e. [*], which will be credited against actual deliveries of OmniFLEX systems to PKI. Alternatively, PKI may opt to pay a cash down-payment of forty percent (40%) for the first [*] units in the amount of [*], plus an irrevocable letter of credit acceptable to BDAL for the down-payment of forty percent (40%) on the remaining [*] units in the amount of [*], with both amounts to be credited against actual deliveries of OmniFLEX systems to PKI. The letter of credit will provide that, if PKI fails to meet its commitment to purchase and take delivery of systems in accordance with the agreed upon monthly delivery rate, BDAL shall have the right, after giving thirty (30) days written notice to PKI, to call the letter of credit. The letter of credit will be reduced quarterly on the last business day of the quarter in an amount equal to the value of the units delivered to PKI during such quarter.


Should PKI determine that it needs more systems during Phase 1, then PKI will advise BDAL as soon as practical on forecasting for additional systems deliveries. Should PKI take delivery and pay for all [*] systems (or optionally [*] systems, see below) ordered in Phase 1 well before Dec. 31st, 2001, then Phase 2 will begin earlier, i.e.


---------- (1) [*] Indicates information has been omitted and separately filed with the Securities and Exchange Commission pursuant to an application for an order declaring confidential treatment thereof.


6


whenever PKI has taken delivery and paid for the first [*](2) systems (or optionally [*] systems, see below).


During Phase 1, PKI may re-sell the co-labeled OmniFLEX MALDI-TOF


o in the US, Canada and Mexico into


(i) the for-profit food and agriculture industries for any application,
including but not limited to research, production, product safety and or
distribution;


(ii) the for-profit chemical, petroleum and polymer industries for
applications involving


(a) the characterization of raw materials, intermediates and
products used in the production and distribution of synthetic
polymers, bulk chemicals, specialty chemicals, and petrochemicals,
and


(b) the development of analytical methods used to support the
characterizations describe in (ii)(a) above; and


(c) research laboratories only as far as these research labs are
involved in methods development for (ii)(a) and (ii)(b) above;


(iii) QA/QC, manufacturing, drug development and clinical trials in the
for-profit pharmaceutical and biotech industry for applications
specifically involving


(a) the characterization of any molecular components integral to the
manufacture and distribution of commercial products, and


(b) the characterization of any molecular component integral to the
development and evaluation of pharmacologically active compounds for
any


---------- (2) [*] Indicates information has been omitted and separately filed with the Securities and Exchange Commission pursuant to an application for an order declaring confidential treatment thereof.


7


development phase after the identification of lead candidate
compounds, including characterization of polypeptides,
oligonucleotides, and carbohydrates synthesized within core
laboratories when these compounds are used as enabling tools for any
development phase after the drug discovery phase and the
identification of lead compounds.


In Phase 1, if PKI increases the minimum order from [*](3) to [*] systems over eighteen (18) months, PKI shall have the option of adding the following countries and fields-of-use to its authorized reselling territory:


o Central and South America to all potential customers


o Italy, Greece, Turkey, Eastern Europe, Israel, and India to all potential
customers.


In Phase 1, PKI is not permitted to re-sell the OmniFLEX into any other country, and PKI is not permitted to re-sell the OmniFLEX in the U.S. and Canada into pharmaceutical/biotech laboratories performing drug discovery, including target research and discovery of new lead compounds; into chemical/polymer research labs, except as described in (ii)(c) above; or into academic, non-profit or governmental customer accounts.


During Phase 1, BDAL will be responsible for installation and warranty service of the co-labeled OmniFLEX in the U.S., Canada and Mexico. If PKI elects to add Central and South America, Italy, Greece, Turkey, Eastern Europe, Israel, and India, then BDAL will initially be responsible for the installation, but PKI will participate in the installation in


---------- (3) [*] Indicates information has been omitted and separately filed with the Securities and Exchange Commission pursuant to an application for an order declaring confidential treatment thereof.


8


order to train its local technicians, and PKI will be responsible for the post-installation warranty service. BDAL will provide 1-2 weeks of installation and service training to PKI at mutually agreeable times at BDAL's Massachusetts factory.


At the beginning of Phase 1, BDAL will generally assist PKI with transferring marketing materials (e.g. Powerpoint presentations, brochures, flyers, manual, advertisements) to PKI at no charge, except for direct printing cost. BDAL retains all rights, including its copyright on these materials, but PKI is authorized to use these materials as co-labeled materials for its own marketing purposes, provided that any material changes in content must be approved in writing by BDAL. However, PKI is responsible for its own advertising, trade show and similar costs. If PKI develops additional marketing materials (e.g. application notes, product notes, photos, etc.), PKI will provide these materials to BDAL at no charge, except for direct printing cost. PKI retains all rights, including its copyright, and BDAL will obtain prior written permission from PKI if BDAL makes material changes in content. BDAL has the right to use the PKI materials as co-labeled materials for marketing purposes.


6. CONTINUATION AND PHASE 2


If PKI reaches or exceeds the minimum sales goal of [*](4) systems (or optionally [*] systems) in Phase 1, then this OEM distribution model is expanded globally for Phase 2, starting Jan. 1st, 2002, and until this Agreement is terminated. If at the end of Phase 1 the minimum sales goal of [*] systems (or optionally [*] systems) has not been reached


---------- (4) [*] Indicates information has been omitted and separately filed with the Securities and Exchange Commission pursuant to an application for an order declaring confidential treatment thereof.


9


by PKI, then this Agreement can either be terminated by either party hereto, or PKI and BDAL may mutually agree to extend Phase 1 by another 2 years.


At least 4 months prior to the beginning of the two-year Phase 2, as well as at least 4 months prior to the beginning of any subsequent 2-year Phase 2 agreement period, PKI will order a two-year minimum order to be mutually agreed upon, but in any case greater than [*](5) systems per month, to be delivered to PKI over 2 years at a minimum rate of greater than [*] systems per month. Unless the parties otherwise mutually agree, this two-year order shall be accompanied with a non-refundable down-payment of forty percent (40%) of the total order value, which will be credited against actual deliveries of OmniFLEX systems to PKI.


Alternatively, PKI may opt to pay a cash down-payment of forty percent (40%) for the first third (one 3rd), plus an irrevocable letter of credit acceptable to BDAL for the down-payment of forty percent (40%) on the remaining two thirds (two 3rds), with both amounts to be credited against actual deliveries of OmniFLEX systems to PKI. The letter of credit will provide that, if PKI fails to meet its commitment to purchase and take delivery of systems in accordance with the agreed upon monthly delivery rate, BDAL shall have the right, after giving thirty (30) days written notice to PKI, to call the letter of credit The letter of credit will be reduced quarterly on the last business day of the quarter in an amount equal to the value of the units delivered to PKI during such quarter.


---------- (5) [*] Indicates information has been omitted and separately filed with the Securities and Exchange Commission pursuant to an application for an order declaring confidential treatment thereof.


10


Should PKI determine that it needs more systems during Phase 2, then PKI will advise BDAL as soon as practical on forecasting for additional systems deliveries.


During Phase 2 and subsequently, PKI may re-sell the OmniFLEX MALDI-TOF


o in the U.S., Canada and Mexico into


(i) the for-profit food and agriculture industries for any application,
including but not limited to research, production, product safety and or
distribution;


(ii) the for-profit chemical, petroleum and polymer industries for
applications involving


(a) the characterization of raw materials, intermediates and
products used in the production and distribution of synthetic
polymers, bulk chemicals, specialty chemicals, and petrochemicals,
and


(b) the development of analytical methods used to support the
characterizations describe in (ii)(a) above; and


(c) research laboratories only as far as these research labs are
involved in methods development for (ii)(a) and (ii)(b) above;


(iii) QA/QC, manufacturing, drug development and clinical trials in the
for profit pharmaceutical and biotech industry for applications
specifically involving


(a) the characterization of any molecular components integral to the
manufacture and distribution of commercial products, and


(b) the characterization of any molecular component integral to the
development and evaluation of pharmacologically active compounds for
any development phase after the identification of lead candidate
compounds, including characterization of polypeptides,
oligonucleotides, and


11


carbohydrates synthesized within core laboratories when these
compounds are used as enabling tools for any development phase after
the drug discovery phase and the identification of lead compounds.
in such other countries and geography, which may be broader than
during Phase 1, and into country-specific fields of use as will be
mutually agreed between the parties prior to the beginning of Phase
2, provided that the monthly minimum quantity of units will exceed
the two (2) units per month of Phase 1 by a mutually agreeable
amount.


In Phase 2 and subsequently, PKI is not permitted to re-sell the OmniFLEX globally into pharmaceutical/biotech laboratories performing drug discovery, including target research and discovery of new lead compounds; into chemical/polymer research labs, except as described in (ii)(c) above, or into academic, non-profit or governmental customer accounts. During Phase 2, PKI will be responsible for installation and warranty service of the co-labeled OmniFLEX globally.


For post-warranty service, PKI and BDAL will adopt a two-layer service strategy with front-line service support by PKI for straight-forward service issues (e.g. subunit exchange, calibration, vacuum service, laser alignment, software loading), and back-up BDAL service by factory-engineers for difficult problems.


7. OEM PRICING AND VOLUME DISCOUNTS


Assuming that PKI herewith places a minimum order with BDAL for [*](6) systems at the beginning of Phase 1, as discussed in section 5 above, and a minimum order of [*]


---------- (6) [*] Indicates information has been omitted and separately filed with the Securities and Exchange Commission pursuant to an application for an order declaring confidential treatment thereof.


12


systems at the beginning of the Phase 2 two-year period (or subsequent two-year Phase 2 type periods), an OEM Discount of [*](7) shall ...