Product Distribution Agreement

EXHIBIT 10.20


PRODUCT DISTRIBUTION AGREEMENT


This Product Distribution 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 Millipore and Mykrolis to carry on their respective businesses as separate companies, Millipore and Mykrolis desire to provide for a product distribution arrangement relating to certain products that have been historically manufactured by Millipore and sold to customers of both Millipore's Microelectronics Division and one or more of Millipore's other divisions, but which will become the products of either Millipore or Mykrolis following the Separation Date.


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
-----------


The following terms shall have the meanings assigned to them below whenever they are used in this Agreement. Capitalized terms used in this Agreement without definition and which are defined in the Master Agreement shall have the meanings assigned to them in the Master Agreement. Except where the context otherwise requires, words imparting the singular shall include the plural and vice versa, words denoting any gender shall include all genders and words denoting persons shall include bodies corporate and vice versa.


"Distributed Products" shall mean the Millipore Products when Millipore is the Manufacturer and Mykrolis is the Distributor, and shall mean the Mykrolis Products when Mykrolis is the Manufacturer and Millipore is the Distributor.


"Distributor" shall mean a party to this Agreement that orders certain Products for distribution pursuant to this Agreement and to whom such Products are sold.


"Field of Use" of a party shall mean (i) for Millipore, the Millipore Core Business, and (ii) for Mykrolis, the Mykrolis Core Business.


"Manufacturer" shall mean a party to this Agreement that manufactures certain Products and that sells such Products to the other party for distribution hereunder.


"Millipore Products" shall mean (i) all products included as of the date
--- of this Agreement in the product lines listed in Exhibit A hereto or thereafter
------- - added to such product lines during the Term of this Agreement, and any improved or updated versions and/or modifications of any of such products, and (ii) those products that may become Millipore Products pursuant to Section 17 hereof.


"Mykrolis Products" shall mean all products included as of the date of this Agreement in the product lines listed in Exhibit B hereto or thereafter added to
------- - such product lines during the Term of this Agreement, and any improved or updated versions and/or modifications of any of such products, and (ii) those products that may become Mykrolis Products pursuant to Section 17 hereof.


"Products" shall mean the Millipore Products and the Mykrolis Products.


"Releases" shall mean any purchase orders or other documents of purchase that a Distributor may place with a Manufacturer for Distributed Products.


"Term" or "Term of this Agreement" shall mean the effective period of this Agreement as set forth in Section 12 hereof.


2. Appointment of Distributor. Millipore hereby appoints Mykrolis as the
--------------------------- exclusive worldwide distributor in the Mykrolis Core Business of the Millipore Products for the Term of this Agreement. Mykrolis hereby appoints Millipore as the exclusive worldwide distributor in the Millipore Core Business of the Mykrolis Products for the Term of this Agreement. Neither Distributor shall have any rights hereunder to distribute or resell Distributed Products outside of its Field of Use, and neither Manufacturer shall be restricted in any way from selling, distributing or marketing its Products in any fields or industries other than the corresponding Distributor's Field of Use. Neither the Manufacturer nor its Affiliated Companies will actively market, advertise, solicit orders or knowingly accept orders of Distributed Products in the Distributor's Field of Use, during the Term of this Agreement. Furthermore, the Manufacturer shall use reasonable efforts to refer to the Distributor any customer inquiries in the Distributor's Field of Use.


2


3. Prices. Each Manufacturer shall sell the Distributed Products to the
------- Distributor at a percentage discount of 35% off its U.S. list price for such Distributed Products. The initial pricing will be based on the discount from the U.S. list prices in effect on the Separation Date, and prices shall be changed annually thereafter, as of the anniversary of the Separation Date, based on the discount off U.S. list prices in effect on such anniversary date. Prices shall be F.O.B. point of shipment by the Manufacturer.


4. Responsibilities of the Distributor.
------------------------------------


(a) Each Distributor shall comply with all laws and regulations applicable
to its distribution of the Distributed Products, including without
limitation the U.S. Foreign Corrupt Practices Act of 1977 and all U.S.
export control laws and regulations.


(b) Each Distributor shall use its reasonable best efforts to provide
service to and to perform all necessary repairs on all Distributed
Products sold by the Distributor in a prompt, professional and proper
manner. If the Manufacturer's personnel are needed to provide
installation, maintenance, or repair service for Distributed Products
sold by the Distributor, and the Manufacturer agrees to provide any
such service, the Manufacturer may charge the Distributor a reasonable
mutually agreed upon fee for such service. If any such repair or
replacement is required while the Distributed Products are still under
the applicable Manufacturer warranty, the Manufacturer will reimburse
the Distributor for the cost of replacement parts therefor.


5. Trademarks, Product Labeling and Packaging.
-------------------------------------------


(a) The trademarks of the Manufacturer and of its Affiliated Companies as
well as all other present or future trademarks of any of them shall be
conspicuously displayed and used by the Distributor in the sale and
promotion of the Distributed Products in a manner identical to or
consistent with the Manufacturer's own practice. All such trademarks
shall be and remain the sole property of the Manufacturer and any use
thereof by the Distributor shall be limited to the Distributed
Products. It is expressly agreed that the Distributor's use of the
Manufacturer's trademarks is with and on the consent of the
Manufacturer and that the Distributor shall acquire no rights in said
trademarks because of its use thereof. The Distributed Products will
bear the labeling and artwork of the Manufacturer, as affixed thereon
by the Manufacturer, and the Distributor will not modify such labeling
or artwork except to add labels stating "Distributed by [fill in name
of Distributor]. For service call ________." or a substantially
equivalent statement, or as may be otherwise expressly authorized in
writing by the Manufacturer in its sole discretion.


3


(b) The Manufacturer shall package the Distributed Products in packaging
configurations currently in effect unless otherwise agreed by the
parties. At a Distributor's request, and with such Distributor's
assistance, the Manufacturer agrees to use its reasonable best efforts
to bar code the Distributed Products in a manner reasonably acceptable
to the Distributor. The Distributor agrees to accept the
Manufacturer's methodology for designating and displaying lot numbers
and expiration dates, if any.


6. Supply of Distributed Products
------------------------------


(a) Each Manufacturer agrees to sell to the corresponding Distributor,
from time to time during the Term, Distributed Products, in the
amounts contained in the Distributor's Releases. Except as set forth
in Section 7(a) hereof, neither Distributor shall have any minimum or
maximum purchase requirements for any or all of such Distributed
Products hereunder, either per order or in the aggregate.


(b) Unless otherwise agreed by both parties in writing, this Agreement
applies to all Releases placed by a Distributor with the corresponding
Manufacturer during the Term. The terms and conditions of this
Agreement shall apply to any Release, whether or not this Agreement or
its terms and conditions are expressly referenced in the Release.


(c) Unless otherwise agreed by both parties in writing for a specific
transaction, no inconsistent or additional term or condition in any
Release, or in any acknowledgment, invoice or other document issued by
a Manufacturer in connection with a particular purchase by a
Distributor, shall be applicable to a transaction within the scope of
this Agreement. Both parties specifically agree that any terms and
conditions in any such documents which are in any way inconsistent
with this Agreement shall be inapplicable, and the terms of this
Agreement shall govern.


7. Orders, Delivery and Payment
----------------------------


(a) Each Distributor will provide the corresponding Manufacturer with a
rolling one year forecast of its demand for Distributed Products
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 f ...