Document:

Exhibit 10.3

 

 

TRANSITION SERVICES AGREEMENT

 

BY AND BETWEEN

 

APPLERA CORPORATION

 

AND

 

CELERA CORPORATION

 

 

DATED AS OF                           
, 2008

 

 

TABLE OF CONTENTS

 

	
  ARTICLE I TRANSITION SERVICES

  	
  2

  
	
   

  	
   

  
	
   

  	
  Section 1.1

  	
  Transition Services

  	
  2

  
	
   

  	
  Section 1.2

  	
  Provision of Transition Services

  	
  2

  
	
   

  	
  Section 1.3

  	
  Additional or Modified Transition Services

  	
  2

  
	
   

  	
  Section 1.4

  	
  General Cooperation

  	
  2

  
	
   

  	
  Section 1.5

  	
  Adverse Modifications

  	
  3

  
	
   

  	
   

  
	
  ARTICLE II TERM

  	
  3

  
	
   

  	
   

  
	
   

  	
  Section 2.1

  	
  Agreement Term

  	
  3

  
	
   

  	
  Section 2.2

  	
  Service Term

  	
  3

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE III COMPENSATION AND PAYMENT ARRANGEMENTS
  FOR TRANSITION SERVICES 

  	
  3

  
	
   

  	
   

  
	
   

  	
  Section 3.1

  	
  Compensation for Transition Services

  	
  3

  
	
   

  	
  Section 3.2

  	
  Payment Terms

  	
  4

  
	
   

  	
  Section 3.3

  	
  Quarterly Review

  	
  4

  
	
   

  	
  Section 3.4

  	
  Taxes

  	
  4

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE IV RELATIONSHIP TO OTHER DOCUMENTS

  	
  5

  
	
   

  	
   

  
	
  ARTICLE V DISPUTE RESOLUTION

  	
  5

  
	
   

  	
   

  
	
  ARTICLE VI INDEMNIFICATION

  	
  5

  
	
   

  	
   

  
	
   

  	
  Section 6.1

  	
  Indemnification by Applera

  	
  5

  
	
   

  	
  Section 6.2

  	
  Indemnification by Celera

  	
  5

  
	
   

  	
   

  
	
  ARTICLE VII FORCE MAJEURE

  	
  5

  
	
   

  	
   

  
	
  ARTICLE VIII TERMINATION

  	
  6

  
	
   

  	
   

  
	
   

  	
  Section 8.1

  	
  Termination of Transition Services and Agreement for
  Convenience

  	
  6

  
	
   

  	
  Section 8.2

  	
  Termination for Default

  	
  6

  
	
   

  	
  Section 8.3

  	
  Return of Material

  	
  6

  
	
   

  	
  Section 8.4

  	
  Effect of Termination

  	
  7

  
	
   

  	
   

  
	
  ARTICLE IX OTHER REPRESENTATIONS, WARRANTIES AND
  COVENANTS 

  	
  7

  

 

i

 

	
   

  	
  Section 9.1

  	
  Compliance with Laws

  	
   

  	
  7

  
	
   

  	
  Section 9.2

  	
  Books and Records

  	
   

  	
  7

  
	
   

  	
  Section 9.3

  	
  No Other Representations or Warranties

  	
   

  	
  7

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE X MISCELLANEOUS

  	
   

  	
  7

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 10.1

  	
  Relationship of the Parties

  	
   

  	
  7

  
	
   

  	
  Section 10.2

  	
  Employees of the Parties

  	
   

  	
  8

  
	
   

  	
  Section 10.3

  	
  Notices

  	
   

  	
  8

  
	
   

  	
  Section 10.4

  	
  Governing Law

  	
   

  	
  9

  
	
   

  	
  Section 10.5

  	
  Parties in Interest; Assignment; Successors

  	
   

  	
  9

  
	
   

  	
  Section 10.6

  	
  Entire Agreement

  	
   

  	
  9

  
	
   

  	
  Section 10.7

  	
  Schedules

  	
   

  	
  9

  
	
   

  	
  Section 10.8

  	
  Waivers of Default

  	
   

  	
  9

  
	
   

  	
  Section 10.9

  	
  Amendments

  	
   

  	
  9

  
	
   

  	
  Section 10.10

  	
  Headings

  	
   

  	
  9

  
	
   

  	
  Section 10.11

  	
  Severability; Enforcement

  	
   

  	
  9

  
	
   

  	
  Section 10.12

  	
  No Third-Party Beneficiaries

  	
   

  	
  9

  
	
   

  	
  Section 10.13

  	
  Remedies

  	
   

  	
  10

  
	
   

  	
  Section 10.14

  	
  Expenses

  	
   

  	
  10

  
	
   

  	
  Section 10.15

  	
  Counterparts

  	
   

  	
  10

  
	
   

  	
  Section 10.16

  	
  No Set-Off

  	
   

  	
  10

  
	
   

  	
  Section 10.17

  	
  Confidentiality

  	
   

  	
  10

  
	
   

  	
  Section 10.18

  	
  Facilities and Systems Security

  	
   

  	
  10

  
	
   

  	
   

  	
   

  	
   

  
	
  Schedule A — Celera Service Attachment

  	
   

  	
   

  	
   

  
	
  Schedule B — Applera Service Attachment

  	
   

  	
   

  	
   

  
						

 

ii

 

TRANSITION
SERVICES AGREEMENT

 

This Transition Services Agreement (this “Agreement”),
dated as of
                ,
2008 (the “Effective Date”), is entered by and between Applera
Corporation, a Delaware corporation (“Applera”), and Celera Corporation,
a Delaware corporation (“Celera” and, collectively with Applera, the “Parties,”
and each individually, a “Party”).

 

R
E C I T A L S

 

WHEREAS, prior to the Separation (as defined below)
Applera conducted its business through two business segments — the Applied
Biosystems Group, which primarily serves the life science industry, research
community and other markets, including human identity testing, biosecurity, and
quality and safety testing, by developing and marketing instrument-based
systems, consumables, software, and services (the “Applied Biosystems
Business”), and the Celera Group, which is primarily a human in vitro
diagnostics business that delivers personalized disease management through a
combination of products and services (the “Celera Business”); and

 

WHEREAS, the Board of Directors of Applera has
determined that it is advisable and in the best interests of Applera and its
stockholders to separate the Celera Group from Applera by way of a redemption
of all of the issued and outstanding Celera Group Common Stock pursuant to Article IV,
Section 2.4(d) of Applera’s Restated Certificate of Incorporation
(the “Separation”), so that, from and after the date hereof, the Celera
Business will be conducted through Celera, which will be a separate,
independent publicly traded company; and

 

WHEREAS, to effectuate the Separation, the Parties
have entered into that certain Separation Agreement dated as of May 8,
2008 (the “Separation Agreement”) setting forth, among other things, the
terms and conditions of the Separation (capitalized terms used herein but not
defined herein shall have the meanings set forth in the Separation Agreement);
and

 

WHEREAS, prior to the Separation, Applera has
provided, or caused to be provided, certain services to the Celera Group in
connection with the operation of its business, and the Celera Group has
provided, or caused to be provided, certain services to Applera in connection
with the operation of its business; and

 

WHEREAS, in connection with the Separation, the
parties desire that Applera and the Applera Subsidiaries, on the one hand, and
Celera and the Celera Subsidiaries, on the other hand, continue to provide, or
cause to be provided, certain services to the other Party for an interim period
following the consummation of the Separation to assist with the transition in
connection with the Separation, on the terms and conditions set forth herein.

 

NOW, THEREFORE, in consideration of the foregoing
and the mutual representations, warranties, covenants and agreements set forth
herein and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Parties, intending to be
legally bound hereby, agree as follows:

 

 

ARTICLE
I

TRANSITION SERVICES

 

Section 1.1       Transition
Services.  Upon the terms and subject
to the conditions set forth in this Agreement, Applera shall provide, or shall
cause to be provided, to Celera and the Celera Subsidiaries, the services set
forth in the service attachment (the “Celera Service Attachment”)
attached hereto as Schedule A (individually, a “Celera Transition
Service”, and collectively, the “Celera Transition Services”) and
Celera and the Celera Subsidiaries shall provide, or shall cause to be
provided, to Applera and the Applied Biosystems Subsidiaries the services set
forth in the service attachments (the “Applera Service Attachment” and
together with the Celera Service Attachment, the “Service Attachments”)
attached hereto as Schedule B (individually, an “Applera Transition
Service”, and collectively, the “Applera Transition Services”, and
collectively with the Celera Transition Services, the “Transition Services”),
in each case, during the applicable Service Term (as hereinafter defined in Article II
of this Agreement) for each such Celera Transition Service or Applera
Transition Service, as the case may be.

 

Section 1.2       Provision
of Transition Services.  Subject to
any limitations imposed by Applicable Law or any professional or licensing
authority or other Governmental Authority or as otherwise set forth in the
Service Attachments, each Party shall provide, or cause to be provided, the
Transition Services to the other Party pursuant to this Agreement in a manner
generally consistent with past practices of that Party in providing the same or
similar services to the other Party prior to the execution of the Separation
Agreement; provided, however, that both Parties shall be entitled to engage any
third party to provide or assist it in providing the Transition Services;
provided, further, if the engagement of any such third party would result in an
increase in the cost payable by the other Party for such Transition Service
pursuant to this Agreement, prior consent of the other Party shall be required
for such engagement.

 

Section 1.3       Additional
or Modified Transition Services. 
From time to time, either Party may request that the other Party
provide, or cause to be provided, to it additional or modified services
hereunder that relate to the transition in connection with the Separation but
are not described in the Service Attachments; provided, however, that neither
Party shall have an obligation to agree to provide to the other Party such
additional or modified services.  To
initiate such request for additional or modified services, the requesting Party
shall submit a written request to the other Party, containing a detailed
description of the requested additional or modified services.  If and to the extent that Applera and Celera
mutually agree as to the cost and scope of such additional or modified
services, the Parties shall amend the relevant Service Attachment in writing,
as necessary, to include such additional or modified services.

 

Section 1.4       General
Cooperation.  Subject to the terms
and conditions set forth in this Agreement, Applera and Celera shall each use
commercially reasonable efforts to provide information and documentation
sufficient for the other Party to provide, or cause to be provided, the
Transition Services pursuant to this Agreement substantially as they were
performed prior to the execution of the Separation Agreement, and make
available, as reasonably requested by the other Party, sufficient resources and
timely decisions, approvals and acceptances in order that each Party may
accomplish its obligations under this Agreement in a timely and efficient
manner.

 

2

 

Section 1.5           Adverse
Modifications.

 

(a)       Unless otherwise provided for in this
Agreement, if Celera makes any change in the processes, procedures, practices,
networks, equipment, configurations, or systems pertaining to the Celera
Business, and such change has an adverse impact on Applera’s ability to provide
any of the Celera Transition Services, then Applera shall be excused from
performance of any such affected Celera Transition Services (each, a “Celera
Affected Transition Service” and, collectively, the “Celera Affected
Transition Services”) unless and until Celera mitigates the adverse impact
of such change, and Celera shall be responsible for all direct expenses
incurred by Applera in connection with the cessation and, if applicable, the
resumption of the Celera Affected Transition Services.

 

(b)        Unless otherwise provided for in this
Agreement, if Applera makes any change in the processes, procedures, practices,
networks, equipment, configurations, or systems pertaining to the Applied
Biosystems Business, and such change has an adverse impact on Celera’s ability
to provide any of the Applera Transition Services, then Celera shall be excused
from performance of any such affected Applera Transition Services (each, an “Applera
Affected Transition Service” and, collectively, the “Applera Affected
Transition Services”) unless and until Applera mitigates the adverse impact
of such change, and Applera shall be responsible for all direct expenses
incurred by Celera in connection with the cessation and, if applicable, the
resumption of the Affected Transition Services.

 

ARTICLE II

TERM

 

Section 2.1       Agreement
Term.  This Agreement shall commence
on the Effective Date and shall continue in effect until the last to expire
Service Term, unless earlier terminated in accordance with the provisions of Article VIII
hereof (as the same may be extended or earlier terminated, the “Agreement
Term”).

 

Section 2.2       Service
Term.  Each Transition Service
described in Schedule A and Schedule B attached hereto shall
commence on the Effective Date and shall continue until the earlier of (i) the
expiration of the Agreement Term, and (ii) such time as such Transition
Service is terminated in accordance with the provisions of Article VIII
hereof (each, individually, a “Service Term” and, collectively, the “Service
Terms”).

 

ARTICLE III

COMPENSATION AND PAYMENT ARRANGEMENTS FOR TRANSITION SERVICES

 

Section 3.1       Compensation
for Transition Services.  In
consideration of the Transition Services provided to the Parties hereunder,
Celera shall pay Applera for each and every Celera Transition Service provided
pursuant to this Agreement, and Applera shall pay Celera for each and every
Applera Transition Service provided pursuant to this Agreement, in each case,
during the Service Term for such Transition Service, the fee set forth with
respect to each such Transition Service in the respective Service Attachments
(individually a “Service Fee” and, collectively, the “Service Fees”).
 In addition, each Party shall reimburse
the other Party for 

 

3

 

all
out-of-pocket fees, costs and expenses incurred by the other Party and its
Affiliates in the procurement of services or equipment in the performance of
the Transition Services hereunder, including, without limitation, any
incremental fees, costs and expenses incurred by Applera related to any Celera
Affected Transition Service or incurred by Celera related to any Applera
Affected Transition Service (collectively, “Expenses”).

 

Section 3.2       Payment
Terms.  Within thirty (30) days after
the end of each calendar month during the Agreement Term, or extension thereof,
each Party shall deliver to the other Party an invoice setting forth in
reasonable detail the Service Fees and Expenses that apply to each Transition
Service provided, or caused to be provided, to the other Party and its
Subsidiaries for such calendar month (as set forth on each such invoice, the “Monthly
Fees and Expenses”).  Promptly
following receipt of each invoice, but in no event later than thirty (30) days
following the receipt of such invoice, the Party receiving such invoice shall
pay the other Party the Monthly Fees and Expenses shown on such invoice.  If such payment is not received by within
such thirty (30)-day period, the Party responsible for such payment shall also
pay the other Party interest from and after the last date of the calendar month
in respect of such invoice, but excluding the date of payment by such Party responsible
for the payment, at a rate per annum equal to the Prime Rate on the last day of
the calendar month in respect of such invoice. 
If the Party receiving such invoice disputes in good faith any portion
of the amount due on any invoice, it shall notify the other Party in writing of
the nature and basis of the dispute within fifteen (15) Business Days after its
receipt of such invoice and pay any undisputed amounts.  If the Party receiving such invoice does not
provide to the other Party a notice of dispute within such fifteen (15)
Business Day period, the invoiced amount shall be deemed to be accurate and
correct and shall not be subject to dispute or contest by such Party or any
Affiliate thereof.  The Parties shall use
their reasonable best efforts to resolve any disputes prior to the applicable
payment due date pursuant to Article V of this Agreement.

 

Section 3.3       Quarterly
Review.  During the Agreement Term,
promptly after the completion of each calendar quarter following the date
hereof, the Transition Teams shall meet to review the quantity and scope of
Transition Services rendered pursuant to this Agreement, and, to the extent
that such quantity and scope exceeds the quantity and scope originally
contemplated by this Agreement, the Team Leaders shall negotiate in good faith
to adjust the Service Fees in order to fully compensate the Party providing
such Transition Services for the Transition Services actually provided
hereunder.  Any Disputes resulting in
connection with review required pursuant to this Section 3.3 shall be
resolved pursuant to Article V of this Agreement.

 

Section 3.4       Taxes.  All charges and fees to be paid by a Party
under this Agreement are exclusive of any applicable withholding, sales, use,
value added, excise, services or other United States, state, local or foreign
tax which may be assessed on the provision of the Transition Services.  In the event that a withholding, sales, use,
value added, excise, value added services or other United States, state, local
or foreign tax is assessed on the provision of any of the Celera Transition
Services provided to Celera under this Agreement, Celera will pay directly,
reimburse or indemnify Applera for such taxes, as well as any applicable
interest and penalties.  In the event
that a withholding, sales, use, value added, excise, value added services or
other United States, state, local or foreign tax is assessed on the provision
of any of the Applera Transition Services provided to Applera under this
Agreement, Applera will pay directly, 

 

4

 

reimburse
or indemnify Celera for such taxes, as well as any applicable interest and
penalties.  The Parties will cooperate
with each other in determining the extent to which any tax is due and owing
under the circumstances, and shall provide and make available to each other any
resale certificates, information regarding out-of-state or country use of
materials, services or sale, and other exemption certificates or information
reasonably requested by either Party. 
This section shall have no application to any tax based upon the income
of Applera or Celera, as the case may be.

 

ARTICLE IV

RELATIONSHIP TO OTHER DOCUMENTS

 

If
there is any conflict or inconsistency between the terms and conditions set
forth in the main body of this Agreement and any of the Schedules to this
Agreement, the provisions of the Schedules shall control with respect to the
rights and obligations of the parties regarding the Transition Services.  If there is any conflict or inconsistency
between the terms and conditions of this Agreement and the Separation
Agreement, the provisions of this Agreement shall control solely with respect
to the rights and obligations of the Parties regarding the Transition Services.

 

ARTICLE V

DISPUTE RESOLUTION

 

If a Dispute arises between the Parties with respect
to the terms and conditions of this Agreement, or any subject matter governed
by this Agreement, the Parties agree to use and follow the dispute resolution
procedures set forth in Article XIII of the Separation Agreement to
resolve any such dispute.

 

ARTICLE VI

INDEMNIFICATION

 

Section 6.1       Indemnification
by Applera.  Applera shall indemnify,
defend and hold harmless Celera, against and in respect of any and all
Indemnifiable Losses incurred by Celera that result from, relate to or arise
out of the performance by Celera of the Applera Transition Services under this
Agreement, in accordance with Article XI of the Separation Agreement,
except to the extent that any such Indemnifiable Losses arise out of or result
from the gross negligence or willful misconduct of Celera.

 

Section 6.2       Indemnification
by Celera.  Celera shall indemnify,
defend and hold harmless Applera, against and in respect of any and all
Indemnifiable Losses incurred by Applera that result from, relate to or arise
out of the performance by Applera of the Celera Transition Services under this
Agreement, in accordance with Article XI of the Separation Agreement,
except to the extent that any such Indemnifiable Losses arise out of or result from
the gross negligence or willful misconduct of Applera.

 

5

 

ARTICLE VII

FORCE MAJEURE

 

Except for payment of amounts due, no Party shall be
in default of this Agreement to the extent that any delay or failure in the
performance of its obligations under this Agreement results from any cause
beyond its reasonable control and without its fault or negligence, such as acts
of God, acts of civil or military authority, embargoes, epidemics, war, riots,
insurrections, fires, explosions, earthquakes, floods, unusually severe weather
conditions, power failures, communication failures including internet
disruptions, equipment failures, labor problems or unavailability of
parts.  In the event of any such excused
delay, the time for performance shall be extended for a period equal to the
time lost by reason of the delay.

 

ARTICLE VIII

TERMINATION

 

Section 8.1       Termination
of Transition Services and Agreement for Convenience.  A Party’s obligation to provide the
Transition Services shall terminate, with respect to each Transition Service,
on the last day of the period set forth on the Service Attachments with respect
to such Transition Service (as may be extended as provided on the Service
Attachments, each, a “Service Termination Date”); provided, however, a
Party shall have the right to terminate any Transition Service which it is
receiving prior to the applicable Service Termination Date, in whole only, upon
sixty (60) days prior written notice to the Party providing such Transition
Service.  If all Transition Services
shall have been terminated under this provision prior to the expiration of the
Agreement Term, this Agreement shall immediately terminate.

 

Section 8.2       Termination
for Default.  In the event either
Party shall: (i) fail to pay for Transition Services in accordance with
the terms of this Agreement (and such payment is not disputed by the Party in
receipt of the invoice in good faith in accordance with Section 3.2); (ii) either
Party shall default, in any material respect, in the due performance or
observance by it of any of the other terms, covenants or agreements contained
in this Agreement; or (iii) either Party shall become or be adjudicated
insolvent and/or bankrupt, or a receiver or trustee shall be appointed for
either Party or its property or a petition for reorganization or arrangement
under any bankruptcy or insolvency law shall be approved, or either Party shall
file a voluntary petition in bankruptcy or shall consent to the appointment of
a receiver or trustee, any non-defaulting Party shall have the right, at its
sole discretion, (A) in the case of a default under clause (iii), to
immediately terminate this Agreement, and (B) in the case of a default
under clause (i) or (ii), to terminate this Agreement if the defaulting
Party has failed to (x) cure the default within thirty (30) days of
written notice of default or if the default (except for defaults as a result of
failure to make payment) is such that it will take more than thirty (30) days
to cure, within an extended time period which shall be not longer than what is
reasonably necessary to effect performance or compliance or (y) diligently
pursue the curing of the default.

 

Section 8.3       Return
of Material.  Subject to the
limitations with respect to the Transition Services set forth in the Service
Attachments, as a Service Term is terminated, each of Applera and Celera will,
and will cause their respective Subsidiaries to, return all material and 

 

6

 

property
owned by the other Party and its Subsidiaries, including, without limitation,
any and all material and property of a proprietary nature involving the other
Party and its Subsidiaries relevant to the provision of that Transition Service
and no longer needed regarding the performance of other Transition Services
under this Agreement within thirty (30) days after the applicable
termination.  Upon termination of this
Agreement, each of Applera and Celera will, and will cause their respective
Subsidiaries to, return any and all material and property of a proprietary
nature involving the other Party and its Subsidiaries, in its possession or
control, within thirty (30) days after the termination of this Agreement.  Notwithstanding anything to the contrary contained
in this Agreement, upon the termination or expiration of this Agreement, Celera
shall no longer be entitled to, and shall cease all access to Applera’s
information, data, systems and other assets that are not Celera Group Assets
and Applera shall no longer be entitled to, and shall cease all access to
Celera’s information, data, systems and other assets that are not Applied
Biosystems Group Assets.

 

Section 8.4       Effect
of Termination.  The provisions of
Articles III, IV, V, VI, VII, VIII and X shall survive the termination or
expiration of this Agreement.

 

ARTICLE IX

OTHER REPRESENTATIONS, WARRANTIES AND COVENANTS

 

Section 9.1       Compliance
with Laws.  Each Party shall comply,
at its own expense, with the provisions of all laws applicable to the performance
of its obligations under this Agreement.

 

Section 9.2       Books
and Records.  Each Party or its
Affiliates will maintain books and records substantially similar to those
maintained prior to the date hereof pertaining to its provision of the
Transition Services.  Each Party or its
Affiliates will provide the other Party, with access to such books and records
in accordance with the provisions of Section 9.2 of the Separation
Agreement.  All such information shall be
subject to the terms of the confidentiality provisions set forth in Section 9.6
of the Separation Agreement.

 

Section 9.3       No Other
Representations or Warranties. 
EXCEPT FOR THE REPRESENTATIONS AND WARRANTIES EXPRESSLY SET FORTH IN
THIS AGREEMENT, NEITHER PARTY NOR ANY OTHER PERSON MAKES ANY OTHER EXPRESS OR
IMPLIED REPRESENTATION OR WARRANTY ON BEHALF OF EITHER PARTY WITH RESPECT TO
THE TRANSITION SERVICES, AT LAW OR IN EQUITY, INCLUDING, WITHOUT LIMITATION,
WITH RESPECT TO MERCHANTABILITY OR FITNESS FOR ANY PARTICULAR PURPOSE, AND ANY
SUCH OTHER REPRESENTATIONS OR WARRANTIES ARE HEREBY EXPRESSLY DISCLAIMED.

 

ARTICLE X

MISCELLANEOUS

 

Section 10.1     Relationship
of the Parties.  The Parties declare
and agree that each Party is engaged in a business that is independent from
that of the other Party and each Party shall perform its obligations as an
independent contractor.  It is expressly
understood and agreed that Celera and Applera are not partners or joint
venturers, and nothing contained herein is 

 

7

 

intended
to create an agency relationship or a partnership or joint venture.  Neither Applera nor any of its Affiliates is
an agent of Celera or any of its Affiliates and has no authority to represent
Celera or any of its Affiliates as to any matters, except as authorized in this
Agreement or in writing by Celera from time to time.  Neither Celera nor any of its Affiliates is
an agent of Applera or any of its Affiliates and has no authority to represent
Applera or any of its Affiliates as to any matters, except as authorized in
this Agreement or in writing by Applera from time to time.

 

Section 10.2     Employees
of the Parties.  Applera shall be
solely responsible for payment of compensation to its employees and for any
injury to them in the course of their employment.  Applera shall assume full responsibility for
payment of all federal, state and local taxes or contributions imposed or
required under unemployment insurance, social security and income tax laws with
respect to such persons.  Celera shall be
solely responsible for payment of compensation to its employees and for any
injury to them in the course of their employment.  Celera shall assume full responsibility for
payment of all federal, state and local taxes or contributions imposed or
required under unemployment insurance, social security and income tax laws with
respect to such persons.

 

Section 10.3     Notices.  All notices, requests, demands, waivers and
communications required or permitted to be given under this Agreement shall be
in writing (which shall include notice by telecopy or like transmission) and
shall be deemed given (i) on the day delivered (or if that day is not a
Business Day, on the first following Business Day) when (x) delivered
personally against receipt or (y) sent by overnight courier, (ii) on
the day when transmittal confirmation is received if sent by telecopy (or if
that day is not a Business Day, on the first following Business Day) and (iii) on
the third Business Day after mailed by certified or registered first-class mail
to the Parties at the following addresses (or to such other addresses as a
Party may have specified by notice given to the other Party hereto pursuant to
this provision):

 

If to Applera, to:

 

Applera Corporation

301 Merritt 7

Norwalk, Connecticut  06851

Attention: General Counsel

Facsimile: (203) 840-2902

 

If to Celera, to:

 

Celera Corporation

1401 Harbor Bay Parkway

Alameda, California  94502

Attention: President

Facsimile: (510) 749-4267

 

8

 

Section 10.4     Governing
Law.  This Agreement shall be
governed by, and construed in accordance with, the laws of Delaware, without
reference to choice of law principles, including matters of construction,
validity and performance.

 

Section 10.5     Parties
in Interest; Assignment; Successors.  Neither this Agreement nor any of the rights,
interests or obligations hereunder shall be assigned by any of the Parties
hereto (other than to a successor of either Party by way of merger,
consolidation, sale of all or substantially all of such Party’s assets or
similar transaction) without the prior written consent of the other
Parties.  Subject to the preceding
sentence, this Agreement shall inure to the benefit of and be binding upon
Celera and Applera and their respective Subsidiaries, successors and permitted
assigns.  Nothing in this Agreement,
express or implied, is intended to confer upon any other Person any rights or
remedies under or by reason of this Agreement.

 

Section 10.6     Entire
Agreement.  This Agreement, including
the schedules, appendices, certificates, instruments and agreements delivered
pursuant hereto, contain the entire understanding of the Parties hereto and
thereto with respect to the subject matter contained herein and therein, and
supersede and cancel all prior agreements, negotiations, correspondence,
undertakings and communications of the Parties, oral or written, respecting
such subject matter.

 

Section 10.7     Schedules.  The Service Attachments referenced in this
Agreement and attached hereto are incorporated into this Agreement by reference
and made a part hereof.

 

Section 10.8     Waivers
of Default.  Waiver by any Party of
any default by any other Party of any provision of this Agreement (a) shall
be effective only if in writing; and (b) if given, shall not be deemed a waiver
by the waiving Party of any subsequent or other default, nor shall it prejudice
the rights of the other Party.

 

Section 10.9     Amendments.  No provisions of this Agreement shall be
deemed amended, supplemented or modified by any Party, unless such amendment,
supplement or modification is in writing and signed by the authorized
representative of the Party against whom such waiver, amendment, supplement or
modification is sought to be enforced.

 

Section 10.10   Headings  The article, section and paragraph headings
contained in this Agreement are for reference purposes only and shall not
affect in any way the meaning or interpretation of this Agreement.  All references herein to “Articles” or “Sections”
shall be deemed to be references to Articles or Sections hereof unless
otherwise indicated.

 

Section 10.11   Severability;
Enforcement.  The invalidity of any
portion hereof shall not affect the validity, force or effect of the remaining
portions hereof.  If it is ever held that
any restriction hereunder is too broad to permit enforcement of such
restriction to its fullest extent, each Party agrees that a court of competent
jurisdiction may enforce such restriction to the maximum extent permitted by
law, and each Party hereby consents and agrees that such scope may be
judicially modified accordingly in any proceeding brought to enforce such
restriction.

 

Section 10.12   No
Third-Party Beneficiaries.  Nothing
in this Agreement shall confer any rights upon any Person or entity other than
the Parties and their respective, heirs, successors and permitted assigns.

 

9

 

Section 10.13   Remedies.  The Parties agree that money damages or other
remedy at law would not be a sufficient or adequate remedy for any breach or
violation of, or a default under, this Agreement by them and that in addition
to all other remedies available to them, each of them shall be entitled to the
fullest extent permitted by law to an injunction restraining such breach,
violation or default or threatened breach, violation or default and to any
other equitable relief, including specific performance, without bond or other
security being required.

 

Section 10.14   Expenses.  Except as otherwise provided in this
Agreement, the Parties shall bear their own expenses (including all time and
expenses of counsel, financial advisors, consultants, actuaries and independent
accountants) incurred in connection with this Agreement.

 

Section 10.15   Counterparts.  This Agreement may be executed in one or more
counterparts, which may be delivered by facsimile or scanned electronic copy in
pdf format, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.

 

Section 10.16   No Set-Off.  The obligations under this Agreement shall
not be subject to set-off for non-performance or any monetary or non-monetary
claim by any Party or any of their respective Affiliates under any other
agreement between the Parties or any of their respective Affiliates.

 

Section 10.17   Confidentiality.
 Disclosure and use of Confidential
Information by the Parties shall be governed by Section 9.6 of the
Separation Agreement.

 

Section 10.18   Facilities
and Systems Security.  If either
Party or its personnel shall be given access to the other Party’s facilities,
premises, equipment or systems, such Party shall comply with all such other
Party’s written security policies, procedures and requirements made available
by each Party to the other, and shall not tamper with, compromise, or
circumvent any security or audit measures employed by such other Party.  Each Party shall use its reasonable best
efforts to ensure that only those of its personnel who are specifically
authorized to have access to the facilities, premises, equipment or systems of
the other Party gain such access, and to prevent unauthorized access, use,
destruction, alteration or loss in connection with such access.

 

[SIGNATURE PAGE FOLLOWS]

 

10

 

                IN WITNESS WHEREOF, the Parties
hereto have executed and delivered this Agreement as of the date first above
written.

 

	
   

  	
   

  	
  APPLERA
  CORPORATION

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  CELERA
  CORPORATION

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
   

  	
  Title:Exhibit 10.5

 

*Confidential Treatment Requested by Celera Corporation*

 

Master Purchase Agreement

 

This Master Purchase Agreement (this “Agreement”),
effective as of
                    ,
2008 (the “Effective Date”), is entered into
between Applera Corporation, a Delaware corporation (“AB”),
having a place of business at 850 Lincoln Centre Drive, Foster City, California
94404, and Celera Corporation, a Delaware Corporation (“Celera”),
having a place of business at 1401 Harbor Bay Parkway, Alameda, California
94502, each individually a “Party” and
collectively the “Parties”.

 

WHEREAS, Celera desires to purchase certain products from AB, and AB,
subject to the terms and conditions of this Agreement, is willing to supply
such products to Celera;

 

NOW, THEREFORE, in consideration of the premises and mutual promises
set forth in this Agreement, the Parties agree as follows:

 

1                                         Definitions

 

1.1.        “Celera Critical Product” means a Product to be supplied by
AB to Celera pursuant to this Agreement that (i) as of the Effective Date
is manufactured by AB or for AB using AB’s IPR, (ii) is used by Celera in
the manufacture or sale of Celera Products as of the Effective Date, (iii) will
be used in Celera’s breast cancer products in development as of the Effective
Date and (iv) (x) for which IPR, owned or controlled by AB, would be
required if Celera were to make or have made such Celera Products or (y) where
there is no commercially reasonable alternative to AB as a source of supply.
Celera Critical Products are listed on Exhibit A. In addition, Celera
Critical Products will include Products derived from the Maui Project that are
used by Celera in the manufacture or sale of Celera Products and that are
manufactured by AB or for AB using AB’s IPR and as to which clause (iv) above
is applicable.

 

1.2.        “Celera Product” means a product made by or on behalf of
Celera, that is sold by Celera or its Distributor, that contains an
Intermediate purchased from AB and/or an Oligonucleotide Conjugate purchased
from AB or manufactured by or for Celera.

 

1.3.        “Defective Item” means a Product that has a manufacturing
defect or design defect under the product liability laws of the State of
Delaware.

 

1.4.        “Diagnostic Losses” means claims, losses, damages, expenses
or liabilities arising from or caused by, or alleged to have arisen from or be
caused by, any failure of a Celera Product or any component or part thereof, to
properly diagnose a disease or condition or to make a diagnosis, including
without limitation the making or reporting by a Celera Product or any component
or part thereof of an incorrect diagnosis or a false positive finding or
indication, or the failure of a Celera Product or any part or component thereof
to make or report a finding or indication that if made would result in or support
a diagnosis.

 

1.5.        “Distributor” means any distributor of Celera Products for
Celera. A Distributor of Celera Products as of the Effective Date is Abbott
Molecular.

 

1.6.        “Effective Date” means the date set forth in the preamble
above.

 

1

 

*Confidential Treatment
Requested by Celera Corporation*

 

1.7.        “Field” means Human In Vitro Diagnostics Field as defined in
the Separation Agreement.

 

1.8.        “Intellectual Property Rights” or “IPR”
means all intangible property rights worldwide arising under statutory or
common law, whether or not perfected, including, without limitation, all (1) patents,
patent applications and patent rights; (2) divisions, continuations,
continuations-in-part, renewals, reissues, re-examinations, continuing
prosecutions, and extensions of the foregoing existing at a time in question,
or thereafter filed, issued or acquired; (3) rights associated with works
of authorship including copyrights, copyright applications, copyright
registrations, and derivative works; and (4) Know-how.

 

1.9.        “Instrument” means an Applied Biosystems CE sequencer
instrument previously purchased by Celera or Abbott for the Abbott Alliance (as
defined in the Operating Agreement) as listed on Exhibit B attached hereto.

 

1.10.      “Intermediate” means the materials that are sold by AB,
including AB catalog products and materials that were produced and/or
configured on a custom basis for Celera and any New Products that are added,
but excluding Raw Materials, that are listed in Exhibit A.1.

 

1.11.      “Know-how” means confidential and/or proprietary technical
and other information, whether patentable or not, including, without
limitation, concepts, discoveries, inventions, modifications, improvements,
data, results, designs, formulae, ideas, analyses, methods, techniques, assays,
research plans, procedures, tests, processes (including manufacturing
processes, specifications and techniques), laboratory records, chemical,
pharmacological, toxicological, clinical, analytical and quality control data,
reports, and summaries.

 

1.12.      “Knowledge”
means, and is limited to, the actual knowledge, as of the Effective Date, of a
Party’s Named Representatives, of facts, documents or information, without
investigation on the part of such Named Representatives. Knowledge may not be
imputed, and there shall be no duty to conduct further inquiry, from the fact
that particular documents, contracts, patents, licenses or the like
(collectively, “document files”) are possessed by a Party’s Named Representatives,
where such Named Representatives have not investigated such document files.

 

1.13.        “Named Representative” means, with respect to AB, the patent
attorneys and patent agents, senior director attorneys and technology
transaction attorneys in the Applied Biosystems Legal Department and the Senior
Director of Strategic Technology Licensing in the Applied Biosystems Strategy
and Business Development Department, and, with respect to Celera, any officer
or employee.

 

1.14.      “New Product” means a product to be supplied by AB to Celera
that is not listed on Exhibit A as of the Effective Date.

 

1.15.      “New Product Pricing” means the price assigned to a New
Product at the time such New Product is added to the list of Products on Exhibit A
and any New Product derived from the Maui Project (as defined in the Operating
Agreement). For AB products in existence at the time such AB product becomes a

 

2

 

*Confidential Treatment
Requested by Celera Corporation*

 

New Product by its addition to Exhibit A
and any New Product derived from the Maui Project, New Product Pricing will be
established using a trailing 12 month weighted average of the sales price, less
customary trade discounts and allowances and excluding in all cases, sales to
Celera and sales involving promotional or early access discounts or special
pricing as part of a collaborative exchange with a Third Party (all of the
foregoing collectively, “net sales price”) to AB’s top five customers (or a
smaller number if there are less than five customers) receiving the lowest
global net sales price for such New Products (“AB’s Top
Five”).

 

If the New Product has not been previously sold by AB at the time such
AB product is to become a New Product, the initial sales price to Celera will
be based on AB’s established list price for such New Product less a discount of
10%. An interim New Product Pricing will be determined using the weighted
average of the net sales price to AB’s Top Five for the next 2 full AB fiscal
quarters following the addition of the New Product to Exhibit A and any
New Product derived from the Maui Project A final New Product Pricing will be
determined using the weighted average of the net sales price to AB’s Top Five
for the next four full AB fiscal quarters following the determination of the
interim New Product Pricing. Such final New Product Pricing will be effective
immediately thereafter for 1 full fiscal year, subject to the provisions of
Sections 5.2 and 5.3. In no event will retroactive adjustments be made for any
sales from AB to Celera using the initial sales price for a New Product.

 

1.16.      “Oligonucleotide Conjugate” means an oligonucleotide that
has been chemically combined with a Raw Material.

 

1.17.      “Products” means Intermediates and Raw Materials listed on Exhibit A.1
(Intermediates) and on Exhibit A.2 (Raw Materials), respectively, and
Instruments on Exhibit B, including any New Products added thereto
subsequent to the Effective Date.

 

1.18.      “Raw Materials” means materials that are not sold by AB as
standalone products or as components of products but that are used by AB to
make Oligonucleotide Conjugates and other chemical derivatives of such
materials. Raw Materials include those that are listed in Exhibit A.2, and
any New Products that are Raw Materials and are added to Exhibit A.2.

 

1.19.      “Separation Agreement” means the agreement between AB and
Celera dated May 8, 2008. Capitalized terms used but not defined in this
Agreement will have the meaning given to such terms in the Separation Agreement.

 

1.20.      “Specifications” means, with respect to a Product listed on Exhibit A
or Exhibit B as of the Effective Date, AB’s written specifications for
such Product or, if there are no written specifications for a Product,
specifications agreed to in writing by the Parties.

 

1.21.      “Third Party” means any person or entity other than Celera
or AB or an Affiliate of Celera or AB.

 

1.22.      “Third Party Manufacturer” means a Third Party that is a
contract manufacturer for a Party. For the avoidance of doubt, a Third Party
Manufacturer does not include a Third Party who supplies a Party with products
or materials according to the specifications of that Third Party.

 

3

 

*Confidential Treatment
Requested by Celera Corporation*

 

2                                         Products

 

2.1.        Product List. Subject to the terms and conditions of this
Agreement, AB will use commercially reasonable efforts to deliver to Celera or
Distributor, as ordered by Celera pursuant to this Agreement, the Products
listed on and further described in Exhibits A.1 and A.2, and Exhibit B,
attached hereto.

 

2.2.        Adding Products. From time to time, New Products may be
added to Exhibits A or B, at which time such New Products will become subject
to the terms of this Agreement.

 

(a)       If
a New Product is offered by AB to its customers, then 30 days after Celera’s
written request, such New Product will be added to Exhibit A, subject to Section 2.8,
at the New Product Price. In the event that AB must pay a royalty to a Third
Party in order to sell such New Product to Celera pursuant to this Agreement,
and such royalty is not already included in the New Product Price, the amount
of such royalty due with respect to a sale of such New Product by Celera will
be paid by Celera to AB (defined herein as a “Pass-Through
Royalty”). The New Product Price and any applicable Pass-Through
Royalty will be determined by AB within 30 days of such New Product being added
to Exhibit A. For the avoidance of doubt, no Pass-Through Royalty will be
applicable to Products listed on Exhibit A as of the Effective Date to the
extent AB has breached its representations and warranties set forth in Section 2.8
with respect to such Products.

 

(b)      Notwithstanding
Section 2.2(a) above, if Celera can demonstrate that it has previously
ordered a product that is not listed on Exhibit A, such product will be
added to Exhibit A, subject to Section 2.8, at the price previously
paid by Celera, as adjusted pursuant to Section 5.2, and will be deemed a
Product hereunder as of the Effective Date.

 

(c)       If
a New Product is not offered by AB to its customers at the time of Celera’s
request, such New Product will be deemed a custom product and will be addressed
as described in Section 2.7.

 

(d)      If
a New Product is derived from the Kauai Project (as defined in the Operating
Agreement) it will be added to Exhibits A or B, as the case may be, at a price
determined as set forth in the agreement between the Parties for the Kauai
Project.

 

(e)       If
a New Product is derived from the Maui Project it will be added to Exhibits A
or B, as the case may be, at the New Product Price. In the event that AB must
pay a royalty to a Third Party in order to sell such New Product to Celera
pursuant to this Agreement, and such royalty is not already included in the New
Product Price, the Pass-Through Royalty will be paid by Celera to AB. The New
Product Price and any applicable Pass-Through Royalty will be determined by AB
within 30 days of such New Product being added to Exhibit A.

 

(f)       If
a New Product is an Instrument and is not covered by clauses (d) and (e) above,
it will be added to Exhibit B at a price agreed to by the Parties.

 

2.3.        Removing Products. AB will be able to remove Products from Exhibit A
or B if AB ceases to manufacture Products and/or have manufactured for it
Products using AB’s IPR.

 

4

 

*Confidential Treatment
Requested by Celera Corporation*

 

AB will give
Celera six months prior written notice of the date of removal, provided that if
AB is legally compelled to withdraw a product no prior notice need be given,
but notice will be given to Celera as soon as practicable thereafter, and
further provided that if a Third Party Manufacturer ceases manufacture of a
Product it supplies to AB, AB need only provide the notice period it receives
from such Third Party Manufacturer. AB will afford Celera an opportunity to
make an “end of life” purchase of such Product, provided a purchase order for
same is received within 30 days after delivery of written notice of proposed
discontinuance to Celera. Such end of life purchase will not exceed the volume
of that Product Celera estimates it will need for the following two years. AB
will use commercially reasonable efforts to manufacture, or have manufactured,
and deliver the amount of such Product ordered by Celera.

 

2.4.        Celera’s Right to Continue Production. In the event AB
elects to remove a Celera Critical Product from Exhibit A or is prevented
from supplying a Celera Critical Product due to a Force Majeure Event (as defined
in Section 22.6) applicable to AB that continues for 60 days beyond the
delivery date for such Celera Critical Product, AB will have the option of (i) securing an alternative source of supply for such
Celera Critical Product, subject to Celera’s approval, such
approval not to be unreasonably withheld or delayed, or (ii) granting Celera the right to
manufacture such Celera Critical Product itself or through a Third Party
Manufacturer selected by Celera, subject to AB’s approval, such approval not to be
unreasonably withheld or delayed. Notwithstanding anything to contrary herein,
AB will not be obligated to transfer any IPR to Celera or a Third Party
Manufacturer if AB is prohibited from doing so by an injunction. Any
alternative source of supply of a Celera Critical Product to Celera pursuant to
clause (i) above will be on terms substantially similar with the terms of
this Agreement, including price. Celera’s supply through a Third Party
Manufacturer pursuant to clause (ii) above will be subject to the representations
set forth in Section 2.8.

 

If Celera is granted the
right to manufacture the Celera Critical Product itself as provided herein or
through a Third Party Manufacturer, AB will in a timely manner (as is reasonable under
the circumstances) grant to Celera a limited,
non-exclusive, royalty-free license, subject to Section 2.8, (without the
right to sublicense or transfer except as provided herein) to use Intellectual
Property Rights owned or controlled by AB necessary to enable Celera or the
approved Third Party Manufacturer to manufacture the Celera Critical Product.
AB will also provide  technical, product and
manufacturing documentation that Celera or the Third Party Manufacturer may
request as is reasonably necessary to allow Celera continued supply of the
Celera Critical Product so that the availability of the Celera Critical Product
is not interrupted or any interruption is minimized. In addition, any
additional assistance, such as training, that Celera or the Third Party
Manufacturer requests will be provided at AB’s then prevailing rates. Celera
will require any Third Party Manufacturer to agree in writing to treat AB’s
technical, product and manufacturing documentation and Intellectual Property
Rights as Confidential Information of AB, and Celera will restrict disclosure
to those employees and contractors to whom it is necessary to disclose such
Confidential Information in connection with the performance of the duties under
this Section 2.4.

 

AB may notify and demonstrate to Celera that it is again willing and
able to supply the Celera Critical Product. Upon such notice from AB, Celera
will, in a time frame that is commercially reasonable under the circumstances,
commence purchasing the Celera Critical Product from AB and Celera’s rights
under this Section 2.4 will terminate.

 

5

 

*Confidential Treatment
Requested by Celera Corporation*

 

2.5.        Intermediates and Components for Further Manufacturing

 

(a) Intermediates.  Subject
to the restrictions and obligations on Celera’s use of the Intermediates set
forth in this Agreement, Celera will sell Intermediates, directly or through a
Distributor, only (i) to end users who purchase or use Celera diagnostic
products and (ii) for use only with Celera diagnostic products. For the
avoidance of doubt, the foregoing will not restrict Celera’s or its bona fide
collaborators’ use of Intermediates for research, development or in Celera’s
clinical laboratory testing services business, subject in each case to the
restrictions and obligations on Celera herein.

 

(b) Components for Further
Manufacturing. Intermediates and Raw Materials will be deemed to be
and will be components for further manufacturing, and Celera will be deemed to
be and will be the finished device manufacturer, or the manufacturer of any
Celera Product that is a diagnostic product, within the meaning of the U.S.
Food and Drug Administration (“FDA”) laws, rules and
regulations and foreign laws, rules and regulations governing the
manufacture, sale and distribution of diagnostic and other medical devices. AB
may label or refer to Intermediates and Raw Materials as components for further
manufacturing. In the event that any Intermediate or Raw Material is
accompanied by a label or statement stating that such Intermediate or Raw
Material is “For Research Use Only. Not for use in diagnostic procedures” or
words of the same import, such label will not be deemed to restrict Celera’s
use of such Intermediate or Raw Material as a component for further
manufacturing of Celera Products for use in the Field.

 

2.6.        Raw Materials. Celera will have the right to use Raw
Materials purchased from AB, to make, or have made by a Third Party
Manufacturer, Oligonucleotide Conjugates and to use such Oligonucleotide
Conjugates to make, have made, use, sell, offer for sale and/or import Celera
Products that incorporate such Oligonucleotide Conjugates; provided that such
Third Party Manufacturer is not infringing (i) the 5’ Nuclease IPR of
Roche, a partial list of which is as follows: 5,538,848, 5,723,591, 5,876,930,
6,030,787, 6,258,569, 5,804,375, 5,210,015 and 5,487,972; or (ii) AB’s dye
patents, a partial list of which is as follows: 6,649,598, 6,096,723,
6,303,775, 6,020,481, 6,008,379, 6,221,604. Celera will notify AB when it selects
such Third Party Manufacturer and AB will have 30 days to notify Celera whether
or not there is a reasonable and good faith basis to believe that the Third
Party Manufacturer is infringing the AB dye or 5’ Nuclease technology. AB
agrees that it will not commence an infringement action against such Third
Party Manufacturer by reason of its activities conducted for Celera pursuant to
this Section 2.6. Except for permitted transfers to Third Party
Manufacturers solely for the purpose of making Oligonucleotide Conjugates for
Celera, any sale or transfer of Raw Materials to a Third Party is specifically
prohibited. All agreements pursuant to which Raw Materials are transferred to a
Third Party Manufacturer will contain provisions providing that: (i) all
Raw Materials transferred will be deemed confidential information of AB; (ii) the
Third Party Manufacturer will not reverse-engineer any Raw Materials for so
long as they remain confidential information of AB; (iii) the Third Party
Manufacturer will not sell, re-sell, donate or otherwise transfer Raw Materials
to any Third Party; (iv) Celera will have the right, upon reasonable
notice and at its expense, to audit all use of the Raw Materials by the Third
Party Manufacturer to determine compliance with these provisions; and (v) all
Raw Materials will be and remain property of Celera, be subject to removal at
any time upon demand by Celera, be at all times clearly identified by the Third
Party Manufacturer as the property of Celera and be kept

 

6

 

*Confidential Treatment
Requested by Celera Corporation*

 

free of liens
and/or encumbrances of any kind. Scandinavian Gene Synthesis, Celera’s current
Third Party Manufacturer using Raw Materials, is approved by AB as a Third
Party Manufacturer.

 

2.7.        Custom Products. Celera may request AB to create customized
products. AB may accept or reject such a request at its discretion. In the
event AB agrees to create a customized product for Celera, the Parties will
amend this Agreement, or otherwise agree in writing, to include appropriate
special terms and conditions and thereafter such customized product will be
added as a New Product.

 

2.8           Grant of Rights.
(a) AB hereby grants to Celera, under AB’s IPR and, without AB having to pay
any additional consideration, under AB’s existing rights in any Third Party IPR
as of the Effective Date, all rights necessary (i) to make, have made,
use, sell, offer for sale and/or import Celera Products that incorporate
Products, and (ii) to convey to end-users all rights necessary to use
Celera Products that incorporate Products in the Field.

 

(b) Celera
will be responsible for securing access, at Celera’s cost and without any
contribution from AB, to any additional Third Party IPR Celera needs.

 

(c) AB
represents and warrants, to its Knowledge, that AB’s grant of the rights set
forth in Section 2.8(a) are free and clear of any additional
obligations of Celera to AB or a Third Party as to the Products on Exhibits A
and B and that, subject to the provisions of the next sentence, AB has the
necessary rights to sell such Products for use in Celera Products in the Field.
AB makes no representation and warranty with respect to Third Party IPR (i) where
AB’s patent attorneys and patent agents have a good faith, well reasoned legal
basis to believe that the claims of any Third Party IPR are invalid,
unenforceable or not infringed, or (ii) as to the matters set forth on
Schedule 2.8, or (iii) where any Named Representative of Celera has
Knowledge that AB does not have the rights set forth in Section 2.8(a) as
of the Effective Date free and clear of any additional obligations to a Third
Party. For the avoidance of doubt, AB would not be required to convey or obtain
any Third Party IPR for the Field where it does not have such rights to convey
as of the Effective Date, including in those instances where AB has prior to
the Effective Date procured a license to any Third Party IPR for fields other
than the Field, provided that AB’s representation and warranty in this Section 2.8(c) is
true.

 

(d) Notwithstanding
Section 2.8(b), in the event that AB breaches the foregoing representation
and warranty, AB’s sole obligation and Celera’s sole remedy (except for AB’s
indemnity obligations pursuant to Section 15.1) with respect to such
breach will be, at AB’s option, (a) to reimburse Celera for the
consideration paid by Celera to obtain the rights that are the subject of AB’s
breach of such representation and warranty, (b) to use commercially
reasonable efforts at AB’s cost to obtain such rights for Celera as soon as
reasonably feasible, or (c) if AB concludes that obtaining such rights for
Celera is not possible or commercially feasible, paying Celera such damages to
which Celera may be entitled under law for breach of such representation and
warranty, provided that in no event shall such amount exceed lost profits of
Celera as reasonably estimated by Celera for Celera’s inability to sell the
subject Celera Product during the [***] period commencing on the date Celera
ceased exercising the rights that are the subject of such breach.

 

7

 

*Confidential Treatment
Requested by Celera Corporation*

 

3                                         Term

 

3.1.        Initial Term. The term of this Agreement will commence on
the Effective Date and will, unless sooner terminated as provided herein, be in
full force and effect for seven years thereafter (the “Initial
Term”).

 

3.2.        Renewal. Following the Initial Term, this Agreement may be
renewed for consecutive one year terms by mutual agreement of the Parties
reached not later than 90 days prior to the expiration of the then-current
term. If after the Initial Term (or any renewal term) AB elects to terminate
this Agreement, Celera may thereafter reasonably demonstrate to AB that rights
to certain patents or patent applications owned or controlled by AB as to any
Product previously supplied to Celera are required for Celera to continue to
make, use or sell Celera Products. In such event, AB and Celera will discuss
and negotiate in good faith Celera’s access to such AB patents and patent
applications. For the avoidance of doubt, the preceding sentence is not a
binding commitment by either Party to conclude an agreement.

 

4                                         Termination

 

4.1                                 Default. Either Party may terminate this Agreement in the event
the other Party breaches any material obligation hereunder, other than for
non-payment of undisputed amounts past due, and, if such breach is capable of
being cured, such breach remains uncured for 90 days after receipt by the
defaulting Party of written notice of such default; provided,
however, that if such breach is amenable of cure but not within 90 days, and if the breaching
Party begins diligent efforts to
cure such breach promptly after
receipt of written notice thereof, then the breaching Party will have an
additional 90 days within which to cure
such breach provided that the breaching Party continues to use diligent efforts to cure such breach as soon as reasonably
possible. Notwithstanding the foregoing, where the breach is non-payment of amounts
due when payable, the cure period will be 30 days after receipt of written
notice of breach.

 

4.2                                 Acts of Insolvency. Either Party may terminate this
Agreement by written notice if the other Party becomes insolvent, makes a
general assignment for the benefit of creditors, suffers or permits the
appointment of a receiver for its business or assets, or has wound up or
liquidated, voluntarily or otherwise.

 

4.3                                 Challenge to AB Patents. AB may terminate sales of a Product
pursuant to this Agreement in the event Celera initiates any proceeding for the
purpose of challenging AB’s IPR in that Product. Celera will not be deemed to
have initiated such a proceeding if Celera challenges AB’s patent rights in a
Product as a defense or compulsory counterclaim in a proceeding initiated
against Celera by AB or as in a declaratory judgment action brought by Celera
against AB.

 

4.4                                 Force Majeure Event. If a Force Majeure Event (as defined in
Section 22.6) causing AB to fail to supply a Product continues for 60
consecutive days beyond the delivery date for such Product, Celera will have
the right to terminate its obligations under the Agreement with respect to that
Product on 30 days written notice to AB, or provide AB with written notice of
its intent to invoke the provisions of Section 2.4.

 

8

 

*Confidential Treatment
Requested by Celera Corporation*

 

4.5                                 Effect of Termination. Obligations incurred, including
purchase orders accepted, prior to the effective date of termination will not
be affected by termination, provided, however, that if the basis for
termination is non-payment of invoices or acts of insolvency, the terminating
Party may cancel all outstanding purchase orders without penalty or restocking
fee.

 

4.6                                 Effect of Third Party Acquisition. In the event Celera is acquired by a Third
Party during the term or any extended term of this Agreement, then the
purchasing volume of Products and Instruments on Exhibits A and B will be
limited to increases determined by the reasonable requirements to support
Celera’s or a
successor’s on-going business. Such reasonable requirements will be based on
the size of Celera’s business as of the Effective Date of the Separation
Agreement, as increased to take into account subsequent increases in Celera’s
or a Third Party acquirer’s sales volume because of: (i) increased sales
of existing products; (ii) sales of newly introduced products in the
Field; and (iii) the acquisition of other companies or their assets.

 

4.7                                 Return of Confidential Information. Upon cancellation,
termination or expiration of this Agreement, upon written request of a Party,
each Party agrees to immediately deliver to the other Party or destroy all
documents, data, records, notebooks, and similar writings relating in any way
to any Confidential Information of the other Party, including copies then in
such Party’s possession, whether prepared by that Party or others. If any such
documents are destroyed, the Party destroying same will certify to such
destruction in writing. Neither Party will retain any such documents, data, or
other items originated by the other Party, except one copy may be retained for
legal archive purposes.

 

4.8                       Surviving Provisions. The rights and obligations of the
Parties set forth under Sections
                                                      
and any other provisions that are expressly stated to survive termination of
this Agreement will survive termination of this Agreement for any reason. All
other rights and obligations of the Parties will cease on termination of this
Agreement.

 

5                                         Price

 

5.1                                 Price. The price of each Product will be the price set forth
on Exhibit A. The price applicable to a Product may be adjusted pursuant
to the terms of Section 5.2.

 

5.2                                 Price
Changes. The prices set forth in Exhibit A are firm for
the first year following the Effective Date. After the first year of the
Initial Term, AB may increase the prices set forth in Exhibit A not more
frequently than once in any twelve (12) month period, provided that the maximum
percentage change for a Product over the previous price for such Product shall
be limited to a percentage which is calculated as provided below. Any such
change in the Product prices will be effective for all Products ordered after July 1st
of the next July 1 to June 30 fiscal year (the “Fiscal Year”). Each annual change to
the Product prices will be determined using one of the following formulas
depending on type of Product using calculations to one decimal place.

 

5.2.1  Price
Change Formula for BDT Products Containing the [***] Enzyme. The Parties agree to calculate price changes for BDT
Products containing the [***] enzyme using a

 

9

 

*Confidential Treatment
Requested by Celera Corporation*

 

formula
based on the Employment Cost Index for Total Compensation for the Pacific
Region (“ECI”) as it appears on http://www.bls.gov/ro9/eciwest.htm, and the
annual change, if any, in the AB purchase price of the enzyme [***]. The price
of Products may change by an amount determined by AB in its sole discretion,
provided that any increase for such Product from one Fiscal Year to the next
will not exceed the price for that Product in effect during the preceding
Fiscal Year increased by a percent equal to the weighted average percent
increase of two pricing components over the same period.  By the first 15th of May following
the Effective Date and by each May 15th thereafter during the term
of the Agreement, the Parties will calculate a pricing adjustment determined by
the combined percentage of: i) a weighting of 20.0% times the annual percentage
of change from the previous 12 month average from April 1st to March 31st
in the ECI and ii) a weighting of 80.0% times the annual change in the AB
purchase price of the Roche Enzyme [***], with an example as follows.

 

20% (12
month avg percent change of ECI) plus 80% (annual price change in purchase price of [***]
enzyme) = % of maximum price increase/yr

 

Example - Price Change Formula for BDT
Products containing the enzyme [***]

 

A.     Establish: Appropriate Index and Weighted Averages

 

	
   

  	
  20%

  	
  BLS - Employment Cost Index for
  the Pacific Region

  
	
   

  	
  80%

  	
  AB Purchase Price of [***]

  

 

B.     Establish: Timing, Index Base values, and Annual Index Change

 

         1.             Establish Timing Convention

 

	
   

  	
  Period Start

  	
   

  	
  4/1/2007

  	
   

  	
  4/1/2008

  	
   

  	
  4/1/2009

  	
   

  
	
   

  	
  Period End

  	
   

  	
  3/31/2008

  	
   

  	
  3/312009

  	
   

  	
  3/31/2010

  	
   

  
	
   

  	
  Known As:

  	
   

  	
  Base
  Yr.

  	
   

  	
  Year
  1

  	
   

  	
  Year
  2

  	
   

  

 

         2.             Establish Monthly
Average of the 12 Months in the Period

 

	
   

  	
   

  	
   

  	
  Base Yr.

  	
   

  	
  Year 1

  	
   

  	
  Year 2

  	
   

  
	
   

  	
  ECI-Pacific

  	
   

  	
  160

  	
   

  	
  170

  	
   

  	
  190

  	
   

  
	
   

  	
  [***]

  	
   

  	
  $

  	
  2,000

  	
   

  	
  $

  	
  2,200

  	
   

  	
  $

  	
  2,300

  	
   

  
												

 

         3.             Establish Percentage
Change from the Prior Period

 

	
   

  	
   

  	
   

  	
  Base Yr.

  	
   

  	
  Year 1

  	
   

  	
  Year 2

  	
   

  
	
   

  	
  ECI-Pacific

  	
   

  	
   

  	
   

  	
  6.3

  	
  %

  	
  11.8

  	
  %

  
	
   

  	
  [***]

  	
   

  	
   

  	
   

  	
  10.0

  	
  %

  	
  4.5

  	
  %

  

 

C.      Calculate for Year 1 -
Annual Blended Index Pricing Change

 

         1.             Establish Percentage Change from the Prior
Period

 

	
   

  	
   

  	
   

  	
  Year 1

  % Blend

  	
   

  	
  Year 1% of

  Index Change

  	
   

  	
  Year 1 Weighted%

  	
   

  
	
   

  	
  ECI-Pacific

  	
   

  	
  20.0

  	
  %

  	
  6.3

  	
  %

  	
  1.3

  	
  %

  
	
   

  	
  [***]

  	
   

  	
  80.0

  	
  %

  	
  10.0

  	
  %

  	
  8.0

  	
  %

  

 

	
   

  	
  2.

  	
  Pricing on Products can
  change up to:

  	
  9.3

  	
  %

  

 

10

 

*Confidential Treatment
Requested by Celera Corporation*

 

5.2.2 Price
Change Formula for BDT Products containing enzymes other than [***]. The
following formula will govern price changes for BDT Products containing enzymes
other than [***] on Exhibit A. The Parties agree to use weighted average
percentage method of price adjustment such that the price of Products will
change by an amount determined by AB in its sole discretion, provided that any
increase for a Product from one Fiscal Year to the next will not exceed the
price for the Product in effect during the preceding Fiscal Year increased by a
percent equal to the weighted average percent increase of two published indexes
over the same period. The Parties agree to use a composite index based on the
weighted average of the previous 12-month average, from April 1st to March 31st,
of both the ECI and the Producer Price Index for In vitro Manufacturing
Substances (“PPI”). By the first 15th of May following the
Effective Date and by each May 15th thereafter during the Term
of the Agreement, the Parties will calculate a straight line average of the
previous 12 months (April through March of each annual period) for
each of the PPI (as defined above) as it appears on the Bureau of Labor
Statistics website  http://www.bls.gov/ppi/home.htm under In
Vitro Diagnostic Substances Manufacturing PPI code 06371402 and the ECI
as it appears in the Bureau of Labor Statistics website
http://www.bls.gov/ro9/eciwest.htm, or if discontinued such equivalent index as
is mutually agreed to by the Parties. AB will notify Celera of any increase in
price of a Product at least thirty (30) days prior to the date on which the
increase will take effect. The pricing adjustment will be determined by the
combined percentage of: i) a weighting of 70.0% of the average percent change
of the previous 12 months from April 1st to March 31st in the ECI
plus ii) a weighting of 30.0% of the average percent change of the previous 12
months from April 1st to March 31st in the PPI, with an example as
follows.

 

70% (12 month avg percent change of ECI) plus 30%
(12 month avg change of PPI) = % of maximum price increase/yr

 

Example - Price Change Formula for BDT Products
containing enzymes other than [***]

 

A.    Establish:
Appropriate Index and Weighted Averages

 

	
   

  	
  70%

  	
  BLS - Employment Cost Index for the Pacific Region

  
	
   

  	
  30%

  	
  BLS - PPI for In Vitro Manufactured Substances

  

 

B.     Establish:
Timing, Index Base values, and Annual Index Change

 

         1.             Establish Timing Convention

 

	
   

  	
  Period Start

  	
   

  	
  4/1/2007

  	
   

  	
  4/1/2008

  	
   

  	
  4/1/2009

  	
   

  
	
   

  	
  Period End

  	
   

  	
  3/31/2008

  	
   

  	
  3/31/2009

  	
   

  	
  3/31/2010

  	
   

  
	
   

  	
  Known As:

  	
   

  	
  Base Yr.

  	
   

  	
  Year 1

  	
   

  	
  Year 2

  	
   

  

 

11

 

*Confidential Treatment
Requested by Celera Corporation*

 

         2.              Establish Monthly
Average of the 12 Months in the Period

 

	
   

  	
   

  	
   

  	
  Base Yr.

  	
   

  	
  Year 1

  	
   

  	
  Year 2

  	
   

  
	
   

  	
  ECI-Pacific

  	
   

  	
  160

  	
   

  	
  170

  	
   

  	
  190

  	
   

  
	
   

  	
  PPI Invitro Mfg.

  	
   

  	
  180

  	
   

  	
  175

  	
   

  	
  185

  	
   

  

 

         3.              Establish Percentage
Change from the Prior Period

 

	
   

  	
   

  	
   

  	
  Base Yr.

  	
   

  	
  Year 1

  	
   

  	
  Year 2

  	
   

  
	
   

  	
  ECI-Pacific

  	
   

  	
   

  	
   

  	
  6.3

  	
  %

  	
  11.8

  	
  %

  
	
   

  	
  PPI Invitro Mfg.

  	
   

  	
   

  	
   

  	
  -2.8

  	
  %

  	
  5.7

  	
  %

  

 

C.     Calculate
Annual Index-Based Pricing Change

 

         1.              Establish Percentage
Change from the Prior Period

 

	
   

  	
   

  	
   

  	
   

  	
  Year 1 

  % Blend

  	
   

  	
  Year 1 % of

  Index Change

  	
   

  	
  Year 1 Weighted %

  	
   

  
	
   

  	
   

  	
  ECI-Pacific

  	
   

  	
  70.0

  	
  %

  	
  6.3

  	
  %

  	
  4.4

  	
  %

  
	
   

  	
   

  	
  PPI Invitro Mfg.

  	
   

  	
  30.0

  	
  %

  	
  -2.8

  	
  %

  	
  -0.8

  	
  %

  

 

	
   

  	
  2.

  	
  Pricing on Products can
  change up to by:

  	
  3.5

  	
  %

  

 

5.2.3 Price
Change Formula for Other Products. The following formula will govern price
changes for all Products on Exhibit A except those Products in Section 5.2.1
and 5.2.2 above. The Parties agree to use weighted average percentage method of
price adjustment such that the price of Products will change by an amount
determined by AB in its sole discretion, provided that any increase for a
Product from one Fiscal Year to the next will not exceed the price for the Product
in effect during the preceding Fiscal Year increased by a percent equal to the
weighted average percent increase of two published indexes over the same
period. The Parties agree to use a composite index based on the weighted
average of the previous 12-month average, from April 1st to March 31st,
of both the ECI and the PPI. By the first 15th of May following
the Effective Date and each May 15th thereafter during the term
of the Agreement, the Parties will calculate a straight line average of the
previous 12 months (April through March of each annual period) for
each of the PPI as it appears on the Bureau of Labor Statistics website www.bls.gov
under In Vitro Diagnostic Substances Manufacturing, PPI code 06371402 and the ECI
as it appears in the Bureau of Labor Statistics website
http://www.bls.gov/ro9/eciwest.htm, or if discontinued such equivalent index as
is mutually agreed to by the Parties. AB will notify Celera of any increase in
price of a Product at least thirty (30) days prior to the date on which the
increase will take effect. The pricing adjustment will be determined by the
combined percentage of: i) a weighting of 40.0% of the average percent change
of the previous 12 months from April 1st to March 31st in the ECI
plus ii) a weighting of 60.0% of the average percent change of the previous 12
months from April 1st to March 31st in the PPI, with an example as
follows.

 

40% (12
month avg change of
ECI) plus 60% (12 month avg change of PPI) = % of maximum price
increase/yr

 

12

 

*Confidential Treatment Requested by Celera Corporation*

 

Example - Price Change Formula for all Other
AB Products

 

A.          Establish: Appropriate Index and Weighted
Averages

 

40%                         BLS - Employment Cost Index for the Pacific Region

60%                         BLS - PPI for In Vitro Manufactured Substances

 

B.            Establish:
Timing, Index Base values, and Annual Index Change

 

1.              Establish
Timing Convention

 

	
  Period Start

  	
   

  	
  4/1/2007

  	
   

  	
  4/1/2008

  	
   

  	
  4/1/2009

  
	
  Period End

  	
   

  	
  3/31/2008

  	
   

  	
  3/31/2009

  	
   

  	
  3/31/2010

  
	
  Known As:

  	
   

  	
  Base Yr.

  	
   

  	
  Year 1

  	
   

  	
  Year 2

  

 

2.              Establish
Monthly Average of the 12 Months in the Period

 

	
   

  	
   

  	
  Base Yr.

  	
   

  	
  Year 1

  	
   

  	
  Year 2

  	
   

  
	
  ECI-Pacific

  	
   

  	
  160

  	
   

  	
  170

  	
   

  	
  190

  	
   

  
	
  PPI Invitro Mfg.

  	
   

  	
  180

  	
   

  	
  175

  	
   

  	
  185

  	
   

  

 

3.              Establish
Percentage Change from the Prior Period

 

	
   

  	
   

  	
  Base Yr.

  	
   

  	
  Year 1

  	
   

  	
  Year 2

  	
   

  
	
  ECI-Pacific

  	
   

  	
   

  	
   

  	
  6.3

  	
  %

  	
  11.8

  	
  %

  
	
  PPI Invitro Mfg.

  	
   

  	
   

  	
   

  	
  -2.8

  	
  %

  	
  5.7

  	
  %

  

 

C.            Calculate
Annual Index-Based Pricing Change

 

1.              Establish
Percentage Change from the Prior Period

 

	
   

  	
   

  	
  Year 1

  % Blend

  	
   

  	
  Year 1%

  of Index Change

  	
   

  	
  Year 1 Weighted

  %

  	
   

  
	
  ECI-Pacific

  	
   

  	
  40.0

  	
  %

  	
  6.3

  	
  %

  	
  2.5

  	
  %

  
	
  PPI Invitro Mfg.

  	
   

  	
  60.0

  	
  %

  	
  -2.8

  	
  %

  	
  -1.7

  	
  %

  

 

	
  2.    Pricing on
  Products may change up to:

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  0.8

  	
  %

  

 

5.3                                Changed Costs. The Parties agree to negotiate in good faith
a reasonable adjustment to the price of a Product independent of adjustments
pursuant to Section 5.2 in the event of an increase in AB’s cost of
manufacture thereof purchased from Third Party suppliers, provided such
adjustments will occur, if ever, only once  in any 12
month period or at any time provided such costs increase by more than 10%, and
provided further that no price adjustment will be permitted to compensate AB
for royalties paid to obtain Third Party IPR, except to the extent set forth in
Section 2.8.

 

5.4                                Tax, Freight, and Insurance. The prices set forth in Exhibits A
and B are exclusive of all sales, excise or stamp taxes or similar charges,
assessments, fees or duties levied or assessed 

 

13

 

*Confidential Treatment Requested by Celera
Corporation*

 

on or for the sale or transportation of
Products and all transportation, freight, shipping, handling and insurance
charges, all of which will be separately invoiced to Celera.

 

5.5                                Audits. Upon the written request of Celera and not more than
once in each calendar year, AB will permit an independent certified public
accounting firm selected by Celera and reasonably acceptable to AB, at Celera’s
expense, to have access during normal business hours to such of the records of
AB as may be reasonably necessary to verify the accuracy of the New Product
Pricing, Pass-Through Royalties, PPI and ECI adjustments and changed cost
adjustments hereunder for any calendar year ending not more than 36 months
prior to the date of such request, subject to AB’s reasonable health and
safety, security and confidentiality requirements. The accounting firm will
disclose to Celera only whether the foregoing items are correct or incorrect
and the amount of any discrepancy. No other information will be provided to
Celera. If such accounting firm correctly identifies a discrepancy made during
such period, the appropriate Party will pay the other Party the amount of the
discrepancy within 30 days of the date Celera delivers to AB such accounting
firm’s written report so correctly concluding, or as otherwise agreed upon by
the Parties. The fees charged by such accounting firm will be paid by Celera; provided, however, that if AB is found to have erred in AB’s
favor by the greater of (a) $1,000,000 or (b) more than 5% for the
audited period, AB will reimburse Celera for the full cost of the performance
of such audit.

 

6                                        Orders

 

6.1                                Purchase Orders. To purchase Products hereunder, Celera and
its Affiliates (through any of their respective divisions or business units)
may issue purchase orders (“Purchase Orders”), which (a) will
specify the Purchase Order number, type and quantity of Product ordered, places
of delivery, and delivery dates, and (b) may also contain instructions as
to carrier and method of shipment, packaging and labeling, and other relevant
aspects regarding the supply of Products. If Celera fails to specify a carrier
and method of shipment, AB will select a suitable carrier and method of
shipment on a commercially reasonable basis. Celera will place each Purchase
Order with AB at least 10 business days in advance of the delivery date unless
other lead times are specified in Exhibit A with respect to certain
Products. AB will promptly accept and confirm all Purchase Orders issued in
accordance with this Agreement in writing within five business days from the
date of the Purchase Order. In the absence of an acceptance within such period,
the applicable Purchase Order will be deemed accepted by AB.

 

6.2                                Shipment. AB will ship Products subject to a Purchase Order
in accordance with the lead times specified in Exhibit A. Products will be
delivered in single shipments, unless otherwise specified by Celera on a
Purchase Order. In the event that AB
cannot deliver Products in a single shipment or a delay will occur to provide
such single shipment, AB will notify Celera and obtain Celera’s preference as
to how Products are to be shipped.

 

7                                        Forecasts

 

7.1                                Twelve Month Forecast. Celera will provide AB with a rolling
twelve month non-binding forecast of its orders for Products listed on Exhibit A.
The initial forecast will be delivered to AB within 30 days of the Effective
Date and updated quarterly thereafter. If a Product is designated on Exhibit A
as “OTS” (“off the shelf”), no forecast is
required. If a 

 

14

 

*Confidential Treatment Requested by Celera
Corporation*

 

Product is designated on Exhibit A as “MTO” (“made to order”), Celera will place orders for MTO
Products in concert with the lead times for such Products as set forth in Exhibit A.

 

7.2                                Changes in Purchase Orders. Celera may increase the
quantity, or request an earlier delivery date, of a Product ordered over the
quantity and delivery date specified in its firm purchase order for such
Product and AB will use commercially reasonable efforts to fill such orders
provided that the timing of the increased order falls within the agreed upon
lead time for such Product and taking into consideration AB’s obligations to
its other customers with respect to such Product. In no event is AB obligated,
nor will it be a breach of this Agreement if AB is unable, to fill an order
which is more than 125% in excess of the quantity specified in its firm
purchase order or to deliver such order earlier than originally agreed to.

 

8                                        Invoicing
and Payment

 

8.1                                Invoicing. AB will invoice Celera for Products shipped FOB
AB’s dock pursuant to Section 9 at the price per Product unit set forth on
Exhibit A. Invoices will include the applicable Purchase Order number,
quantity and part number of the Products shipped and prices therefor.

 

8.2                                Payment. Celera will pay AB for each Product shipped to
Celera no later than 30 days after receipt of an invoice therefore. AB will not
invoice Celera for a Product until a date that is on or after the date of
shipment of the Product to Celera. Invoicing and payment will be made in United
States dollars.

 

8.3                                Late Payments. If payment is not received by the due date,
AB may assess and Celera agrees to pay a late payment charge at the rate of 1%
per month (12% per year) or the maximum legal rate, whichever is less, of the
amount due from the due date to the date of payment.

 

8.4                                Collection. If AB retains a collection agency or attorney to
collect unpaid amounts, AB may invoice Celera for, and Celera will pay, all
reasonable costs of collection, including without limitation reasonable attorneys
fees.

 

9                                        Shipping,
Delivery and Packaging

 

9.1                                Shipping and Delivery. AB will ship Product so that it is
delivered to Celera on the delivery date, and Products will not be delivered
more than four calendar days prior to the delivery date without Celera’s prior
written consent. AB will notify Celera at the time of shipment as to the
quantity of Product shipped and the specific shipping information. Shipping
quantities may not vary from those established by the Purchase Order unless
otherwise mutually agreed upon in writing by the Parties. In the event any
shipment is delayed, Celera may direct AB to ship such Product by expedited
transportation designated by Celera and AB will bear the expense of any
difference in cost due to such expedited transportation. AB will promptly
notify Celera of its inability or expected inability to meet a delivery date.
AB will ship the Product to the delivery addresses set forth in the applicable
Purchase Order. Celera may, from time to time, instruct AB to deliver all or a
portion of Product ordered pursuant to a Purchase Order to non-Celera
locations. AB will at all times properly handle and store Products in
accordance with AB’s specifications and customary procedures. AB will solely
bear all risk of loss or damage and 

 

15

 

*Confidential Treatment Requested by Celera
Corporation*

 

all costs and expenses incurred by Celera for
storage or return with respect to quantities of Product shipped by AB in excess
of the quantities set forth in the applicable Purchase Order.

 

9.2                                Risk of Loss. Title and risk of loss with respect to all
Products will pass from AB to Celera upon transfer of possession of the Product
to a common or other Third Party carrier at AB’s facility.

 

9.3                                Packaging. Products will be packaged and prepared for
shipment (a) in a manner which (i) follows good commercial practice
and complies with all laws and regulations, including, without limitation, the
hazardous materials regulations set forth in 49 C.F.R. Sections 100 et seq.
(and any subsequent or successor versions thereof) and any other applicable
hazardous materials regulations, and (ii) is acceptable to, and complies
with any specific requirements of, the designated carrier and/or Celera agreed
to by AB in writing, , and (b) in accordance with any reasonable specific
packaging and labeling requirements set forth in the Purchase Order or the
Specifications. Each shipment will be accompanied by a packing slip which will
include Celera’s part numbers, Purchase Order number, AB’s part number, and the
quantity of Products contained in such shipment. AB will be responsible for all
losses or damages caused by or due to any improper packaging.

 

10                                 Quality

 

10.1                          Quality Management System. AB will maintain a Quality Management
System designed to comply, at a minimum, with ISO 9001:2000 at facilities at
which Products are manufactured.

 

10.2                          Certificate of Analysis. AB will deliver certificates of
analysis with Products when delivered to Celera for those Products with respect
to which it is AB’s customary practice with its commercial customers to do so,
and for those Products with respect to which AB and Celera have developed a
certificate of analysis pursuant to the last sentence of this Section 10.2.
If a certificate of analysis has not previously been provided to Celera or is
not provided as a routine matter for a particular Product, or if Celera wishes
and AB agrees to a certificate of analysis for a Product in a format different
than the one furnished by AB to its commercial customers, the Parties will in
good faith seek to agree on the form of a certificate of analysis, and AB will
provide a certificate of analysis in the agreed upon format if the Parties do
agree, and the reasonable development expense and/or increase in cost required
to generate such certificate of analysis will be paid by Celera or reimbursed
to AB by Celera, unless otherwise agreed to by the Parties.

 

10.3                          Product Changes. AB agrees to notify Celera of a change in
composition to or method of manufacture of a Product listed on Exhibit A
or Exhibit B to the extent that AB determines that a change affects the
form, fit or function of the Product and results in a change to the final
Product Specifications (a “Material Product Change”).
Such notification may be in the form of a letter from AB distributed generally
to its customers. Notwithstanding the foregoing, if a Product is manufactured
or supplied by a Third Party, AB’s ability and agreement to provide notice of
change as set forth herein above is subject to AB receiving written change
information from the manufacturer or supplier that notifies AB of a change in
the Product’s Specifications. The parties may designate on Exhibit A
Products for which no Material 

 

16

 

*Confidential Treatment Requested by Celera
Corporation*

 

Product Change can be knowingly made without
AB and Celera first discussing the effect of any such proposed change. If any
Product is so designated, AB will not knowingly make a Material Product Change
to the Product without first notifying Celera in writing and discussing
possible effects of such change.  Celera’s sole
and exclusive remedy, and AB’s sole and exclusive obligation and liability, for
failure to notify Celera of any Material Product Change as required by this
Agreement will be for AB to use its commercially reasonable efforts to fulfill
as soon as reasonably feasible a single order for such Product, with the
Specifications in effect prior to the Material Product Change, that is placed
by Celera with AB within 60 days of Celera’s receiving notification of the
Material Product Change. Such order will be in the amount of Product that
Celera estimates it will need for the following two years in accordance with
the provisions of Section 2.3, provided that AB will not be required to
fulfill such an order placed by Celera if, in AB’s reasonable determination,
the Material Product Change would result in health and safety concerns, and in
which event AB’s sole and exclusive obligation and liability will have been
satisfied.

 

10.4                          Specifications. AB will manufacture and supply all Products
to AB’s most recent Specifications for the Product (that is, AB’s most recent
public written specifications or, with respect to Products for which AB and
Celera have agreed upon specifications, such agreed upon Specifications).
Except as may be otherwise set forth in Section 10.3, nothing in this
Agreement will be deemed restrict or limit AB from making changes to any
product specifications, including without limitation the Specifications of
Products listed on Exhibits A and B, provided that, subject to Section 10.3,
AB will give Celera prior written notice of any changes to Specifications of
Products listed on Exhibits A and B.

 

10.5                          Additional Quality Terms. Celera may request additional
terms regarding the quality of a Product. In such an event the Parties will
conduct good faith discussions regarding such additional quality terms and to
the extent that such a request is within the reasonable capabilities of AB, AB
may include at AB’s discretion such additional quality terms for the specified
Product, provided that doing so may result in the creation of a New Product
with new pricing at AB’s discretion.

 

11                                 Manufacturing
Processes

 

11.1                          Document Retention. AB will maintain all material records
documenting the manufacture, testing and shipment of the Products supplied to
Celera (“Celera Product Documents”) for a
period of five years following the shipment of the Celera Products to Celera or
its designee; provided, however, that AB will
notify Celera prior to destruction of any Celera Product Documents and send
them to Celera, at Celera’s cost, if so requested. AB will allow Celera to
review such Celera Product Documents during any site inspection conducted under
the terms of this Agreement and at other reasonable times at the request of
Celera, in all cases subject to AB’s reasonable health and safety, security,
and confidentiality requirements. Celera Product Documents will be confidential
information of AB, provided however that Celera may disclose such Celera
Product Documents to a Distributor as necessary, and to applicable regulatory
authorities if required to do so under law, subject to satisfaction of AB’s
reasonable confidentiality requirements, which may include, if AB wishes,
signing of a confidentiality agreement in form satisfactory to AB and marking
all documents to protect same under Freedom of Information Act and other
disclosure laws or regulations.

 

17

 

*Confidential Treatment Requested by Celera
Corporation*

 

11.2                          Site Inspections. Upon reasonable prior notice, AB will,
from time to time during the term or any extended term of this Agreement, allow
representatives of Celera to tour and inspect AB facilities utilized by AB in
the manufacture or refurbishing of Celera Products, at reasonable times and
upon reasonable advance notice for the purposes of verifying compliance with
the terms of this Agreement. Any such inspections will not occur more than once
in any calendar year, and will be subject to AB’s reasonable health and safety,
security, and confidentiality requirements.

 

11.3                          Regulatory Inspections. AB will allow representatives of the
FDA or other applicable regulatory or governmental authorities to tour and
inspect all facilities utilized by AB in the manufacture, testing, packaging
and storing of Celera Products, provided that the foregoing will not be deemed
a waiver by AB of any rights or remedies it may have under law or restrict AB
from insisting on reasonable health and safety, security or confidentiality
requirements.

 

11.4                          Responsibility for Regulatory Matters.                               All regulatory matters regarding obtaining and
maintaining any necessary clearance or other permit, permission, consent or approval,
or promotion or labeling, or otherwise complying or assuring compliance with
applicable law for or relating to the importation, sale and use of Celera
Products, if any such requirements exist, from the FDA, or under the European
IVD Directive or any other body or agency, will remain under the exclusive
control of Celera and will be solely Celera’s responsibility. AB will provide
Celera access to documentation under AB’s control reasonably required for
Celera Product regulatory registration (subject to AB’s reasonable
confidentiality requirements), provided that any such registration will not
impose any duties or requirements on AB or require AB to take any action except
to permit regulatory inspections as and to the extent expressly set forth in Section 11.3
of this Agreement.

 

12                                 Defects
and Returns

 

12.1                          Rejected Products. Any claims for damaged, missing or
defective Product must be reported in writing by Celera within 15 days from the
date of Celera’s receipt of the Product, after which time the order will have
been deemed to be accepted. In addition, Celera must promptly return a rejected
Product to AB, C.O.D, unused and in a condition no worse than that delivered to
Celera and in the Product’s original containers and packing material,
accompanied by a valid return authorization number obtained from AB, which will
not be unreasonably withheld or delayed. AB may refuse any Product not timely
rejected or sought to be returned without a valid return authorization number.
For any valid claim timely made, AB, at its option, may repair the Product or
replace the Product with an identical or substantially similar Product.
Shipping charges will not be credited.

 

12.2                          Sole Remedy. THE PROVISIONS OF SECTION 12 SET FORTH
CELERA’S SOLE AND EXCLUSIVE REMEDIES FOR A DAMAGED OR MISSING PRODUCT, AND,
EXCEPT FOR EXPRESS WRITTEN WARRANTY RIGHTS, FOR A DEFECTIVE PRODUCT.

 

12.3                          Decontamination. AB may require that Celera sign and deliver
a properly completed certificate of decontamination prior to returning any
Product.

 

18

 

*Confidential Treatment Requested by Celera
Corporation*

 

13           General Warranty

 

13.1                          Express Warranties. Except as otherwise provided herein, AB
makes only those warranties with respect to Product expressly identified as “warranties”
and set forth in AB’s current operating manual or catalog, or in a specific
written warranty included with and covering a Product, if any.

 

13.2                          No Pass Through. Warranties are made only to the Celera as
the entity purchasing the Product directly from AB, are not transferable and do
not extend to the benefit of any other person or entity, unless otherwise
expressly stated in writing by AB.

 

13.3                          “AS IS”. EXCEPT AS OTHERWISE PROVIDED HEREIN, ANY PRODUCT
NOT COVERED BY AN EXPRESS WRITTEN WARRANTY IS SOLD AND PROVIDED “AS IS,”
WITHOUT WARRANTY OF ANY KIND, STATUTORY, EXPRESS OR IMPLIED.

 

13.4                          Descriptions, Models and Samples. Any description of Product
recited in AB’s quotation is for the sole purpose of identifying Product, and
any such description is not part of any contract between AB and Celera and does
not constitute a warranty that Product will conform to that description. Any
sample or model used in connection with AB’s quotation is for illustrative
purposes only, and is not part of any contract between AB and Celera and does
not constitute a warranty that Product will conform to the sample or model. No
affirmation of fact or promise made by AB, whether or not in AB’s quotation,
will constitute a warranty that Product will conform to the affirmation or
promise. Unless otherwise specified in writing in documentation shipped with
Product or otherwise agreed by AB in writing, AB does not provide service or
support for custom products or other products made to buyer’s specifications.

 

13.5                          Sole and Exclusive. EXCEPT AS OTHERWISE PROVIDED HEREIN, THE
WARRANTIES IDENTIFIED IN SECTION 13.1 ARE APPLERA’S SOLE AND EXCLUSIVE
WARRANTIES WITH RESPECT TO THE PRODUCTS AND ARE IN LIEU OF ALL OTHER
WARRANTIES, STATUTORY, EXPRESS OR IMPLIED, ALL OF WHICH OTHER WARRANTIES ARE
EXPRESSLY DISCLAIMED, INCLUDING WITHOUT LIMITATION ANY IMPLIED WARRANTY OF
MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, NON-INFRINGEMENT, OR
REGARDING RESULTS OBTAINED THROUGH THE USE OF ANY PRODUCT (INCLUDING, WITHOUT LIMITATION,
ANY CLAIM OF INACCURATE, INVALID OR INCOMPLETE RESULTS), WHETHER ARISING FROM A
STATUTE OR OTHERWISE IN LAW OR FROM A COURSE OF PERFORMANCE, DEALING OR USAGE
OF TRADE.

 

14           Limitation of Liability

 

14.1                          Disclaimer of Consequential Damages. EXCEPT AS PROVIDED
HEREIN AND FOR BREACHES OF SECTION 18 (CONFIDENTIALITY) , IN NO EVENT WILL
EITHER PARTY BE LIABLE TO THE OTHER, WHETHER IN CONTRACT, TORT, WARRANTY, OR
UNDER ANY STATUTE (INCLUDING WITHOUT LIMITATION ANY TRADE PRACTICE, UNFAIR
COMPETITION OR OTHER STATUTE OF SIMILAR IMPORT) OR ON ANY OTHER BASIS, FOR
INDIRECT, INCIDENTAL, CONSEQUENTIAL, SPECIAL, MULTIPLE, OR PUNITIVE DAMAGES OF
THE OTHER 

 

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*Confidential Treatment Requested by Celera
Corporation*

 

PARTY OR ITS AFFILIATES, WHETHER OR NOT
FORESEEABLE AND WHETHER OR NOT THE OTHER PARTY IS ADVISED OF THE POSSIBILITY OF
SUCH DAMAGES, INCLUDING, WITHOUT LIMITATION, DAMAGES ARISING FROM OR RELATED TO
THE USE OR PERFORMANCE OF PRODUCTS, LOSS OF USE, LOSS OF DATA, FAILURE OR
INTERRUPTION IN THE OPERATION OF ANY EQUIPMENT, DELAY IN REPAIR OR REPLACEMENT,
FAILURE OF ANY PRODUCT TO OPERATE OR PERFORM AS INTENDED, OR LOSS OF
GOODWILL. For the avoidance of doubt, the provisions of this Section 14.1
are not intended to be a waiver of any damages of a Third Party subject to a
Party’s indemnification obligations under Sections 15 and 16.

 

15           General Indemnification

 

15.1                          Indemnification by AB.

 

(a)                                 AB
will defend, indemnify and hold harmless Celera, its Affiliates and their
respective directors, officers, employees and agents (“Celera
Indemnitees”) (for purposes of this Section 15 the term “Indemnitee” may refer to either or both the AB Indemnitees
and the Celera Indemnitees, as the context may indicate) from and against:

 

(i) any
and all claims for losses, damages or expenses asserted by a Third Party
against Celera or any of its Affiliates to the extent caused by the material
breach of any representation, warranty or covenant made by AB in this
Agreement, the negligence (including gross negligence) or willful misconduct of
AB, or the manufacture by AB of a Defective Item, in all cases above to the
extent the claimed loss, damage or expense is for personal injury to or death
of a human (including without limitation employees of Celera) or damage or
destruction to tangible property, but excluding in all cases above Diagnostic
Losses except to the extent subject to AB’s indemnity set forth below in
subclause (ii) of this Section 15.1;

 

(ii) Diagnostic
Losses to the extent, and only to the extent, resulting from the gross
negligence or willful misconduct of AB; and

 

(iii) any
and all claims for losses, damages or expenses asserted by a Third Party
against Celera or any of its Affiliates to the extent caused by AB’s breach of
the representations, warranties and/or covenants made by AB in Section 2.8
(Grant of Rights) of this Agreement, subject to a cap of $[***].

 

(b)                                AB
will also indemnify and hold harmless Celera from and against Celera’s
reasonable attorneys’ fees and costs in defending any claims subject to AB’s
indemnity set forth above in Section 15.1(a) with respect to which AB
has not undertaken Celera’s defense, except to the extent otherwise set forth
in Section 15.3.

 

15.2                          Indemnification by Celera.

 

(a)                                 Except
with respect to claims expressly subject to AB’s indemnity of Celera set forth
in Section 15.1, Celera will defend, indemnify and hold harmless AB, its
Affiliates and their respective directors, officers, employees and agents (“AB Indemnitees”) from and against any and all claims for
losses, damages or expenses asserted by a Third Party against AB or any of its
Affiliates caused by:

 

20

 

*Confidential Treatment Requested by Celera
Corporation*

 

(i) the
material breach of any representation, warranty or covenant made by Celera in
this Agreement, the negligence (including gross negligence) or willful
misconduct of Celera;

 

(ii) the
possession, manufacture, sale, storage, use or transportation of Celera
Products or parts or components thereof by any person (including without
limitation by any governmental entity), including, without limiting the
generality of the foregoing, claims for personal injury to or death of any
person (including without limitation employees of AB or Celera) or damage or
destruction of tangible property, Diagnostic Losses, even if caused by or
alleged to have been caused by the negligence of AB but not to the extent
caused by the gross negligence or willful misconduct of AB, or the failure of any
Celera Product or any component thereof to be qualified, registered or approved
under any applicable law; and

 

(iii) any
and all claims for losses, damages or expenses asserted by a Third Party
against AB or any of its Affiliates to the extent caused by Celera’s breach of
the representations and warranties made by Celera in Section 2.8 (Grant of
Rights) of this Agreement, subject to a cap of $[***].

 

(b)                                Celera
will also indemnify and hold harmless AB from and against AB’s reasonable
attorneys’ fees and costs in defending any claims subject to Celera’s indemnity
set forth above in Section 15.2(a) with respect to which Celera has
not undertaken AB’s defense, except to the extent otherwise set forth in Section 15.3.

 

15.3                         Conditions of Indemnification, Procedures.

 

(a)                                 In any action for
which a Party seeks indemnity from the other Party under this Section 15,
the Party seeking indemnification will tender the defense to the other Party,
and if such other Party accepts such indemnity and agrees in writing that it
will defend, indemnify and hold harmless the Party seeking indemnification
pursuant to this Section 15, such other Party will have the sole right to
control and conduct the defense and/or settlement of such action, either in the
name of Celera or AB or both with counsel mutually satisfactory to the Parties.
In the event a Party disagrees as to whether it is obligated to indemnify the
other under Section 15.3 with respect to for one or more claims, it will
so promptly notify the other Party, and the Parties will promptly meet to
evaluate whether the evidence then available to the Parties reasonably supports
such claim. If the Parties cannot agree, the matter will be addressed and
finally determined in accordance with the dispute resolution provisions of the
Separation Agreement. Until a final determination is made, the Party seeking
indemnification hereunder may appear and defend in such action and, if the
indemnification provisions are determined to apply, the Party found to be
obligated to indemnify will reimburse the Party seeking indemnification for
such Party’s reasonable out of pocket legal fees and expenses for the defense
of such action.

 

(b)                                If
a Party or Indemnitee intends to claim indemnification under this Section 15.3,
it will promptly notify the other Party (the “Indemnitor”)
in writing of any claim, demand, action or other proceeding for which the
Indemnitee intends to claim such indemnification, and the Indemnitor may
participate in, and, to the extent the Indemnitor so desires, assume the defense
of, such claim, demand, action or proceeding with counsel mutually satisfactory
to the Parties; provided, however, that an
Indemnitee will have the right to retain its own counsel, with the fees and
expenses to be paid by the Indemnitor, if representation of such Indemnitee by
the 

 

21

 

*Confidential Treatment Requested by Celera
Corporation*

 

counsel retained by the Indemnitor would be
inappropriate due to actual or potential differing interests between the
Indemnitee and any other Party represented by such counsel in such proceeding.
The obligations of this Section 15.3 will not apply to amounts paid in
settlement of any claim, demand, action or other proceeding if such settlement
is effected without the consent of the Indemnitor, which consent will not be
unreasonably withheld or delayed. The failure to deliver written notice to the
Indemnitor within a reasonable time after the commencement of any such action,
if materially prejudicial to its ability to defend such action, will relieve
the Indemnitor of any obligation to the Indemnitee under this Section 15.3,
but otherwise the Indemnitor will not be relieved of its indemnity and defense
obligations on account of any failure or delay to deliver notice of a claim.
The Indemnitee will reasonably cooperate with the Indemnitor and its legal
representatives in the investigation of any claim, demand, action or other
proceeding covered by this Section 15.3. An Indemnitor will not agree to
the settlement of any claim without the consent of the other Party, which will
not be unreasonably withheld or delayed.

 

16           Intellectual Property
Indemnification

 

16.1                          Indemnity by AB. Subject to the restrictions set forth in
this Section 16 and provided Celera complies with its obligations in this Section 16,
AB agrees to defend Celera, and indemnify Celera from and against any
infringement damages finally awarded, in any legal action or proceeding brought
by a Third Party against Celera to the extent that such action is based on a
claim that the manufacture and sale of a Product by AB infringes any United
States or foreign patent, copyright, trademark or other Intellectual Property
Right of such Third Party if AB had actual knowledge of such intellectual
property right and infringement at the time of delivery of the Product to
Celera. Notwithstanding the foregoing, AB will have no liability or obligation
under this Section 16 with respect to any claim of infringement based
upon: (i) modifications to any Product made by Celera or a Third Party; or
(ii) manufacture, assembly, labeling or branding of Product by AB pursuant
to specifications or designs or requests for specific labeling or branding
furnished by Celera. Notwithstanding anything herein to the contrary, AB will
have no indemnification obligations with respect to Product originating from a
Third Party and provided under this Agreement. Celera’s sole right to
indemnification with respect to such Third Party Product will be pursuant to
the original manufacturer’s or licensor’s indemnification obligations, if any,
to the extent provided by the original manufacturer or licensor.

 

16.2                          Celera’s Obligations. Celera must notify AB in writing of
any claim for which it may seek defense and indemnity from AB hereunder
promptly after becoming aware of such claim, make no admission of liability
with respect to the claim, and cooperate with and provide reasonable assistance
to AB, at AB’s expense with respect to reasonable out of pocket expenses paid
by Celera to Third Parties for such assistance, in the defense or settlement of
such claim. AB will have sole authority to defend and/or settle any claim under
this Section 16. AB’s obligations under this Section 16 are
contingent upon Celera’s compliance with all of the foregoing.

 

16.3                          Remedy for
Infringement, Rights of AB, Exceptions. If any Product or portion
thereof is subject to a suit or other legal proceeding claiming that the
Product or such portion infringes a Third Party’s Intellectual Property Right,
or in AB’s opinion is likely to become 

 

22

 

*Confidential Treatment Requested by Celera
Corporation*

 

subject of such a claim, AB will, at its
option, have the right to either: (a) procure for Celera the right to
continue using the Product; or (b) modify the Product so that it becomes
non-infringing; or (c) require Celera to return the Product and upon
return, refund to Celera the price actually paid by Celera for the Product,
less a reasonable amount for use, damage and obsolescence; or (d) substitute
for the alleged infringing Product other suitable, non-infringing Products with
comparable functionality.

 

16.4                          ENTIRE
LIABILITY. EXCEPT AS OTHERWISE PROVIDED HEREIN, THE FOREGOING STATES THE ENTIRE
LIABILITY OF AB, AND THE EXCLUSIVE REMEDY OF CELERA, FOR ANY INFRINGEMENT OR
CLAIMED INFRINGEMENT OF PATENT, COPYRIGHT, TRADE SECRET OR ANY OTHER INTELLECTUAL
PROPERTY RIGHT BY OR IN CONNECTION WITH ANY PRODUCT.

 

16.5                          By Celera for
Celera’s Modifications or Specifications.
If Celera modifies any Product or furnishes AB with specifications or designs
or requests for specific labeling or branding, Celera agrees to defend,
indemnify and hold AB harmless against all liabilities, damages, costs,
expenses and claims asserted by a Third Party
against AB or any of its Affiliates arising from or based upon Celera’s
modifications or AB’s manufacture and sale of Product or other performance in
compliance with such specifications or designs or requests for labeling or
branding.

 

17           Product Recall

 

17.1                          Product Recall and Corrective
Actions. In the event
that: (a) any government authority issues a request, directive or order
that any Product be recalled; (b) a court of competent jurisdiction orders
such a recall; or (c) Celera and AB determine that any Product should be
recalled because of a regulatory requirement, the Product did not conform to
applicable Specifications, a manufacturing
defect by AB or a defect in materials and workmanship when the Product was
delivered to Celera, then each Party will take reasonable and
appropriate corrective actions consistent with its quality procedures and with
the intent and purposes of this Agreement. Each
Party will immediately notify the other Party telephonically, followed by
notice in writing, of any order, request or directive of a court or other
governmental authority to recall or withdraw a Product in any jurisdiction. AB
will be solely responsible and liable for the costs (including, but not limited
to, costs of notification and all costs of shipment of the recalled Products)
of implementing any recall or withdrawal of any Product, and for the cost of any replacement Products or
refunds required to be given to any end user customer of any Product, to the
extent the recall is caused by (i) a manufacturing defect by AB or a
defect in materials and workmanship when the Product was delivered to Celera or
(ii) the material breach by AB of any of its obligations, representations,
warranties (except Product warranties set forth in Section 13) and
covenants set forth in this Agreement, except for such breaches as to which the
exclusive remedies, identified as such, are expressly set forth elsewhere in
this Agreement. Celera will be responsible, at its sole cost and expense, for
the costs of implementing any recall or withdrawal of Products, in all other
circumstances. For the avoidance of doubt, AB will be responsible and liable
for such costs of recall on account of a Defective Item or such a defect in
materials and workmanship regardless of whether the date of recall was during or
after any applicable Product warranty period. Except as expressly stated above
in this Section 17.1 and elsewhere in this Agreement where AB will
indemnify Celera, it is expressly 

 

23

 

*Confidential Treatment Requested by Celera
Corporation*

 

understood and agreed that
Celera, not AB, will be solely responsible and liable for all costs and
liability arising out of any recall not due to AB’s gross negligence or willful
misconduct, as and to the extent set forth in Section 15.1. Celera will be
solely responsible for the text of any statement to be provided to customers.
Notwithstanding the foregoing, no statement regarding any recall that
identifies AB or any of its affiliates, directly or indirectly, by name or by
any other reference (such as “as manufacturer or supplier”) will be disclosed
to any Third Party except with AB’s prior written consent, which will not be
unreasonably withheld or delayed. In the event of a recall for which AB is
responsible as set forth in this Section 17.1 with respect to which (i) Celera
is required under law or contract to, or (ii) the Parties agree in
writing, in accordance with Celera’s normal course of business consistently
applied, to, refund the full purchase price to a customer and/or provide a
customer with a substitute product, AB will reimburse to Celera the transfer
price to Celera of any Products subject to such recall and with respect to
which Celera has refunded the full purchase price of the Product to its
customer. Any Products that are recalled will be returned by Celera to AB. AB
will pay Celera any amount due pursuant to this Section 17.1 within 30
days of receipt of an invoice from Celera therefor, or, if the amount is
disputed by AB, within 30 days of a final determination of the amount due. Any
such invoice will include reasonable documentation to support such charges. If
the Parties do not agree on the amount due, the amount due will be determined
under the dispute resolution procedures set forth in the Separation Agreement.

 

18           Confidentiality

 

18.1                          Confidentiality. At any time during the course of this
Agreement the Parties may disclose to one another, whether verbally or in
documentary form, information deemed by the disclosing Party to be confidential
(“Confidential Information”). This
Confidential Information may include, without limitation, pricing, data,
specifications, formula, diagrams, schematics, Know-how, Product volumes both
current and forecasted, business and financial information and marketing plans.
Confidential Information must be either clearly marked and identified as such
upon its disclosure or, where only identified verbally at time of disclosure,
confirmed in writing to the receiving Party as Confidential Information within
30 days. The receiving Party will not disclose Confidential Information to any
Third Party or use it for any purpose, in each case except as allowed under and
consistent with this Agreement, and will take all reasonable measures to
protect its confidentiality. These obligations of confidentiality will continue
for a period of five years following termination or expiration of this
Agreement, except with respect to Confidential Information that are trade
secrets, in which case the obligation of confidentiality will continue until
the trade secrets lose their status as such due to no fault of the receiving
Party. Excluded from Confidential Information is any information that (a) is
or becomes public knowledge through no fault of the receiving Party, (b) the
receiving Party can demonstrate through clear documentary evidence was known to
it prior to receipt and not covered by an obligation of confidentiality in
favor of the disclosing Party, (c) was subsequently received from a Third
Party without any obligation of confidentiality, or (d) is independently
developed by the receiving Party without use of Confidential Information, as
can be demonstrated by clear documentary evidence. This section will survive
the termination or expiration of this Agreement.

 

24

 

*Confidential Treatment Requested by Celera
Corporation*

 

19                                 Intellectual
Property

 

19.1                          As between the parties the
ownership of and rights in their respective intellectual property will be
determined in accordance with the provisions of the Separation Agreement.

 

20                                 Trademarks

 

20.1                          As between the parties the
ownership of and rights in their respective trademarks will be determined in
accordance with the provisions of the Separation Agreement.

 

20.2                          No rights to any AB trademark
are transferred to Celera under this Agreement.

 

21                                 Insurance

 

21.1                          AB will, at its own expense,
provide and maintain insurance for Worker’s Compensation; employer’s liability
for bodily injury suffered through accident or disease; and commercial general
liability, provided that in no event will AB carry coverage with limits of less than $2 million per occurrence for
bodily injury and $2 million per occurrence for property damage.

 

21.2                          AB will furnish Celera
certificates of insurance evidencing the required coverage and the insurer’s
agreement to provide 30 days’ prior written
notice to Celera in the event of cancellation or material change in coverage.
AB’s insurance policies will also name Celera as an additional insured with
coverage for Celera at least as broad as provided to AB for liability arising
out of Products supplied pursuant to this Agreement.

 

21.3                          The liability of AB will not
be limited to the amount of insurance which AB is required to provide by the
terms of this Section 21.

 

22                                 General

 

22.1                          Independent
Contractor. The relationship of AB to Celera hereunder is that of an
independent contactor. In no event will either Party hold itself out to others
or allow itself to be considered an agent, employee, or representative of the
other.

 

22.2                          Assignment.
Neither Party may assign or transfer its rights or obligations under this
Agreement or any document relating to this Agreement to any other entity or
person without the prior written consent of the other Party, except that
without the prior written consent of the other Party either Party after written
notice to the other Party may assign this Agreement to any Affiliate of either
Party and to any Party that is the successor to the business and operations of
such Party to which this Agreement relates, or in connection with the merger or
consolidation of the Party, provided that (i) the assigning Party will remain
primarily liable for the assignor’s obligations and covenants in this Agreement
and the assignee and assignor will agree in a writing delivered to the
non-assigning Party that the assignee and assignor will be jointly and
severally liable for the performance of the assignor’s and assignee’s covenants
and obligations in this Agreement and (ii) no Confidential Information of the
assigning Party that has been retained by the Assignor for evidentiary purposes
under Section 14, or that a Party is permitted to retain only for evidentiary
purposes under Section 14, will be delivered or made accessible to the assignee.

 

25

 

*Confidential Treatment
Requested by Celera Corporation*

 

Any purported assignment in violation of the above will be null and
void and of no force and effect. Subject to the foregoing, this Agreement will
be binding upon and inure to the benefit of the Parties and their respective
successors and permitted assigns.

 

22.3         Governing
Law. This Agreement is deemed to be made under and will be construed
in accordance with the laws of the State of Delaware without giving effect to
any choice of law rule that would cause the application of the laws of any
jurisdiction other than the internal laws of the State of Delaware.

 

22.4         Notices.
All notices required hereunder will be in writing and will be sent by (a) U.S.
mail (first class), (b) nationally recognized courier service (e.g., DHL,
Federal Express), with all postage or delivery charges prepaid, or (c) facsimile,
subject to confirmation via U.S. mail or nationally recognized courier service,
and will be addressed to the Parties at their addresses set forth on the cover page of
this Agreement or to such other addresses as may be furnished by written notice
in the manner set forth herein.

 

22.5         Publicity.
Neither Party will advertise or otherwise disseminate by written or oral
publication the existence of this Agreement, or its terms, without the other
Party’s prior written consent, including as to the text thereof, which consent
will not be unreasonably withheld or delayed.

 

22.6         Force
Majeure. Failure of either Party to perform its obligations under
this Agreement (except for the obligation to make payments) will not subject
such Party to any liability to the other Party and will not be deemed a breach
of this Agreement if such failure is caused or occasioned by act of God
(including, without limitation, flood, drought, earthquake), act of a public
enemy including terrorist acts, fire, explosion, war, riot, insurrection,
sabotage, embargo, strike or other labor trouble, power outages or reductions,
failure of AB’s sole sourced suppliers (except where the product supplied is
available from other suppliers on reasonable commercial terms) to deliver on
schedule materials, equipment or machinery for reasons solely due to their own
force majeure (as defined herein), compliance with any order, regulation or
request of any government, administrative or regulatory entity acting with
color of right or any officer, department, agency or committee thereof, or by
any other event or circumstance beyond the reasonable control of the Party so
failing (“Force Majeure Events”). The affected
Party will promptly notify the other Party in writing setting forth the details
of the occurrence of force majeure, its expected duration and how that Party’s
performance is affected, and will use commercially reasonable efforts to resume
performance as soon as possible.

 

22.7         Agreement
Terms Govern. Although the Parties may use a Purchase Order or
whatever other form of writing they select from time to time to quote or order
Products, this Agreement will supersede and fully replace any different, additional
or conflicting terms, including without limitation all preprinted or other
standard terms (other than the name or identity of Products purchased,
quantity, delivery dates, bill to, ship to and invoice addresses and price) on (i) any
quotations, order confirmations, invoices or related documents issued during
the term or any extended term of this Agreement by AB or (ii) any purchase
orders or other related documents issued during the term or extended term of
this Agreement by Celera. Any different, additional or conflicting terms and
conditions in any such documents will be void and of no force and effect unless
agreed to in a writing signed by an authorized representative of each of Celera

 

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*Confidential Treatment
Requested by Celera Corporation*

 

and
AB that expressly states that such different, additional or conflicting terms
and conditions are intended to supersede the terms of this Agreement.

 

22.8         Entire
Agreement. No agreement or understanding in any way modifying these
terms and conditions, either before or after the execution hereof, will be
binding upon either Party unless in writing and signed by both Parties. This
Agreement and the other Separation Documents (as defined in the Separation
Agreement) constitute the entire agreement between the Parties with respect to
the subject matter of this Agreement, and supersede any prior or
contemporaneous communications, with respect to the subject matter hereof and
thereof. For the avoidance of doubt, the agreements between the Parties to be
entered for the supply of the 3100 Genetic Analyzer, among other things, and
the Kauai Project goods will not be merged into this Agreement and will remain
in full force and effect under their own distinct terms and conditions.

 

22.9         Waiver.
Failure by either Party to insist upon strict performance of any of the terms
and conditions hereof, or delay in exercising any rights or remedies provided
herein, will not release the other Party from any of the obligations of this
Agreement and will not be deemed a waiver of any rights of such other Party to
insist upon strict performance thereof.

 

22.10       Severability.
If any one or more of the provisions contained in this Agreement is, for any
reason, held to be invalid, illegal or unenforceable in any respect, such
invalidity, illegality or unenforceability will not affect any other provision
hereof, and this Agreement will be construed as if such invalid, illegal or
unenforceable provision had never been contained herein.

 

22.11       Headings.
Headings used in this Agreement are for convenience of reference only and will
not affect the interpretation of this Agreement.

 

22.12       Counterparts.
This Agreement may be executed in two or more counterparts, each of which
counterparts, when duly executed and delivered, will be deemed to be an
original and all of which counterparts, taken together, will constitute one and
the same Agreement.

 

IN
WITNESS WHEREOF, the Parties have caused their duly authorized representatives
to execute and deliver this Agreement as of the Effective Date.

 

	
  APPLERA
  CORPORATION

  	
   

  	
  CELERA
  CORPORATION

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  	
  Title:

  	
   

  
								

 

 

 

 

27

 

*Confidential Treatment
Requested by Celera Corporation*

 

 

	
  Date:

  	
   

  	
   

  	
  Date:

  	
   

  

 

 

 

 

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