EXHIBIT 10.28
NITROGEN SUPPLY SYSTEM AGREEMENT
AMENDMENT NUMBER 1
THIS AMENDMENT made and effective as of the 15th day of September, 1996
(hereinafter referred to as the "Amended Effective Date"),
BETWEEN: AIR LIQUIDE AMERICA CORPORATION, successor to LIQUID AIR
CORPORATION, MERCHANT (GAS DIVISION, a corporation duly incorporated under the
laws of the State of Delaware, having its main office at 0000 Xxxx Xxx Xxxxxx,
Xxxxxxx, Xxxxx 00000 (hereinafter referred to as AIR LIQUIDE). References in
this Amendment and in the Agreement to Liquid Air and "LAC" shall mean "Air
Liquide".
AND XXXXXX CORPORATION, SEMICONDUCTOR SECTOR, a corporation duly
incorporated under the laws of the State of Delaware, having offices at 0000
Xxxx Xxx Xxxx, Xxxx Xxx, Xxxxxxx (Hereinafter referred to as "HSS")
WHEREAS, HSS AND AIR LIQUIDE entered into that certain NITROGEN SUPPLY
SYSTEM AGREEMENT dated as of the 22nd day of September, 1992 (hereinafter
referred to as the Agreement); and
WHEREAS, HSS is presently expanding the HSS Plant Facilities (as that term
is defined in the Agreement); and
WHEREAS HSS to increase the capacity of Gaseous Nitrogen it wishes to
purchase from AIR LIQUIDE in accordance with Paragraph 3.1 of the Agreement: and
WHEREAS, HSS also desires to purchase Compressed Dry Air from AIR LIQUIDE;
and
WHEREAS, AIR LIQUIDE desires to increase its delivery capacity of Gaseous
Nitrogen by installing Plant #3 (see description below) and pursuant to
Paragraph 3.1 of the Agreement sells to HSS its entire requirement for Nitrogen;
and
WHEREAS, AIR LIQUIDE is desirous of adding the capacity to provide HSS
with Compressed Dry Air,
NOW THEN, in order to bring Plant #3 and the Compressed Dry Air System
under the coverage of the Agreement, AIR LIQUIDE and HSS agree to amend and
supplement the Agreement in the manner as mutually agreed and set forth below:
I. Definitions
As used in the Amendment, all of the defined terms as used in the
Agreement shall have the same meaning as used in the Agreement except and
to the extent modified below:
1. HSS's Distribution System shall also refer to the system of trunk
and service pipelines leading from the battery limits of the AIR
LIQUIDE Plant Facility for the distribution of Nitrogen to the
various use points within HSS's Plant Facilities.
2. Completion Date shall mean with respect to Plant #3 and with respect
to the Compressed Dry Air System December 31, 1996 (or such later
date as may result from events beyond Air Liquide's reasonable
control) or an earlier date, if AIR LIQUIDE notifies HSS that Plant
#3 and the Compressed Dry Air System is available, operating and on
line.
3. Compressed Dry Air System shall mean all equipment and facilities to
be installed, owned and operated by AIR LIQUIDE on the Leased
Premises capable of producing compressed dry air meeting the
specifications set forth on Exhibit A to this Amendment.
4. Plant #3 shall mean the new nitrogen generator (APSA6 type) capable
of producing 40,000 SCF per hour of Gaseous Nitrogen.
5. Gaseous Nitrogen shall mean all quantities of Nitrogen produced in
gaseous form by the AIR LIQUIDE Plant Facility; HPN-l 8 (Plant #2).
HPN-65 (Plant #1) and APSA 6 (Plant #3) and made available for
delivery to HSS.
6. AIR LIQUIDE Plant Facility shall mean all equipment and facilities
previously or to be installed, owned and operated by AIR LIQUIDE on
the Leased Premises for the production, storage, vaporization,
compression and delivery of Nitrogen in accordance with the
Agreement, including any alteration or expansion of such facilities
during the term hereof. The AIR LIQUIDE Plant Facility shall be
capable of producing and compressing a maximum of eighteen thousand
(18,000) SCF per hour of Gaseous Nitrogen (Plant #2) at ninety (90)
PSIG, sixty-five thousand (65,000) SCF per hour of Gaseous Nitrogen
(Plant #1) at ninety-five (95) PSIG and forty thousand (40,000) SCF
per hour of Gaseous Nitrogen (Plant #3) at ninety (90) PSIG, (the
"Plant Maximums") and shall include the Liquid Back-up system and
the Compressed Dry Air System.
II. Construction
A. Upon the Amended Effective Date AIR LIQUIDE shall commence its
efforts to obtain and maintain all permits and licenses necessary
for the construction of the
Plant #3 and the Compressed Dry Air System. HSS shall use all
reasonable efforts to assist AIR LIQUIDE in obtaining and
maintaining such permits and licenses. Should AIR LIQUIDE, despite
exerting every reasonable effort, be unable to obtain all permits
and licenses necessary for the construction of Plant #3 (APSA 6) or
the Compressed Dry Air System as contemplated hereunder within three
hundred (300) days of the Amended Effective Date. AIR LIQUIDE shall
so notify HSS in writing; and those parts of this Amendment relating
to the construction of Plant #3 or the Compressed Dry Air System as
the case may be, may then be suspended by either party by written
notice to the other at any time thereafter until such time as all
such permits and licenses have been obtained. Unless otherwise
agreed in writing by AIR LIQUIDE and HSS, AIR LIQUIDE shall not,
during the period prior to obtaining all necessary permits and
licenses, undertake or commence any work on the design, engineering,
fabrication, procurement or construction of the AIR LIQUIDE #3 Plant
Facility or the Compressed Dry Air System, as the case may be.
B. Promptly upon AIR LIQUIDE obtaining all necessary permits and
licenses, AIR LIQUIDE shall at its sole expense, make necessary and
appropriate preparations for, and thereafter proceed with design,
engineering, fabrication, procurement, and construction of the Plant
#3 and the Compressed Dry Air System described in Exhibit B to this
amendment, upon the Leased Premises.
C. During the preparation for and the construction of Plant #3 and the
Compressed Dry Air System, and at all times as applicable during the
Term, of the Amendment, AIR LIQUIDE shall fulfill the obligations
set forth in Paragraph 2.3 a through and including Paragraph 2.3 e
of the Agreement.
D. During the preparation for and the construction of Plant #3 and the
Compressed Dry Air Systems, and at all times as applicable during
the Term of the Amendment, HSS shall fulfill the obligations set
forth in Paragraph 2.4 a through and including Paragraph 2.4 c of
the Agreement HSS will provide concrete foundations per Air Liquide
specifications for the support of the systems, as well as, lighting,
fencing underground electrical conduits to the points of connection
of the systems and a grounding grid. In addition HSS shall provide
to AIR LIQUIDE the additional utilities set forth on Exhibit C to
this amendment and the additional property needed for Plant #3, the
new liquid nitrogen vaporization system and the Compressed Dry Air
System, all as more fully set forth in an amended Appendix A to
Exhibit 1 of the Agreement, Description of Leased Premises. HSS
shall also provide to AIR LIQUIDE promptly (and in any event no
later than October 1, 1996) after the execution of this amendment, a
fully executed and recordable memorandum of lease reflecting the
increase of the area covered by the 1992 Indenture of lease to
include the area to be occupied by Plant #3 and the Compressed Dry
Air System. Additionally, the plot plan for Plant #3 and the
Compressed Dry Air System is included as Exhibit D to this
Amendment.
III. Pricing
A. Paragraph 4.1(a) is hereby amended by adding two new subparagraphs
at the end of the existing subparagraphs reading as follows:
"A monthly Facility Fee for the Plant #3 of $20,000 starting on
completion date of Plant #3. Said monthly Facility Fee shall be
payable regardless of HSS requirements or consumption up to the
Plant Maximums set forth in Paragraph A.f of the Amendment."
"A monthly Facility Fee for the Compressed Dry Air System of $9,500
starting on completion date of the compressed dry air system. Said
monthly Facility Fee shall be payable regardless of HSS requirements
or consumption up to the Plant Maximums set forth in Exhibit A of
the Amendment."
B. Paragraph 4.1 [c] is hereby amended to read as follows:
"For all quantities of Hauled-In Liquid Nitrogen delivered by AIR
LIQUIDE to HSS, on or after July 1, 1996, HSS shall pay AIR LIQUIDE
a unit price of thirty five cents per hundred standard cubic feet
($0.35/100 scf). For all quantities of Hauled-In Liquid Nitrogen
delivered by AIR LIQUIDE to HSS, prior to July 1, 1996. HSS shall
pay the present price being paid by HSS under the unamended
Agreement."
IV. Price Adjustments
A. Paragraph 5.1 is hereby amended to read as follows:
The price of Hauled-In Liquid Nitrogen (Para 3.2) shall be adjusted
on the first anniversary and every subsequent anniversary of the
Amended Effective Date in direct proportion to changes in the
Producer Price Index (PPI), Table 3. Industry code 2813 (Industrial
Gases) baselined in 1981. The adjusted Hauled-In Liquid Nitrogen
price shall be calculated by multiplying $0.35/100 scf by the latest
known PPI index at the time of the adjustment minus 163.1 (Index of
January 1996) divided by 163.1
V. HSS's Distribution System
The Agreement is hereby amended by substituting the following for
Paragraph 8.0: "HSS shall be responsible, at its own costs, for
maintaining HSS's Distribution System in a condition suitable for
receiving Gaseous Nitrogen at working pressures up to the one hundred ten
(110) PSIG for the Plant #2, and up to one hundred twenty (120) PSIG for
the #1 and #3 Plants at all times during the term of this Amendment. AIR
LIQUIDE agrees to install, construct and connect the necessary
vaporization and filtration
equipment and tie-ins with the existing HSS Distribution System need to
supply MOS 8 with vaporized Liquid."
VI. Specifications
The Agreement is hereby amended by substituting the following for the
first sentence of Paragraph 9.1:
"All Gaseous Nitrogen delivered by AIR LIQUIDE hereunder at a flow rate
not exceeding eighteen thousand (18,000) SCFH for the #2 Plant, sixty-five
thousand (65,000) SCFH for the #1 Plant and forty thousand (40,000) SCFH
for the #3 Plant, shall be in accordance with the following
specifications:"
In addition add the following line to item 3 of the specifications:
"PRESSURE AT POINT OF DELIVERY (PSIG) #3 PLANT 90"
VII. Shutdowns
The Agreement is hereby amended by substituting the following for
Paragraph 11.2. "In the event that downtime of the AIR LIQUIDE Plant
Facility, for reasons other than force majeure, solely attributable to AIR
LIQUIDE exceeds 350 hours for the #1 Plant, 350 hours for the #2 plant and
350 hours for the #3 Plant in any sliding two year period of the
Agreement, commencing with the Completion date, then during any downtime
exceeding 350 hours per plant in any said two year period. AIR LIQUIDE's
price to HSS for vaporized Hauled-In Liquid Nitrogen, up to sixty-five
thousand (65,000) SCFH for the #1 Plant, eighteen thousand (18,000) SCFH
for the #2 Plant and forty thousand (40,000) SCFH for the #3 Plant shall
be equal to the average power cost to HSS for the production of a like
quantity of Gaseous Nitrogen at the AIR LIQUIDE Plant Facility during the
most recent on-stream month. All other conditions of the Agreement
including payment of the monthly Facility Fee adjustment called for (the
pursuant to Paragraph 5.1 (as amended) shall also be made during such
downtime periods. Said price adjustment(s) shall be the sole remedy of HSS
for any downtime.
VIII. Warranties
The Agreement is hereby amended to extend this limitation of warranty
referred to in Section 16 to Nitrogen and Compressed Dry Air.
IX. Term
A. "The Term of this Amendment (with respect to Plant #3 and the
Compressed Dry Air System (only) begins on the Amended Effective Date and,
except as otherwise herein specifically provided shall continue for an Initial
Period beginning on the said Amended Effective date and continuing until the end
of 120th month following the Completion Date for #3 Plant and Compressed Dry Air
System. After the end of the said 120th month the Term shall
further continue for five year terms unless written notice of termination is
given by either party ax least twelve (12) months prior to the end of the said
120th month.
B. The agreement is hereby amended by adding the following Paragraph
after Paragraph 19.2:
With regards to Plant #3 and Compressed Dry Air System, "HSS shall
have the option of terminating this Agreement for those plants
subject to the conditions set forth in paragraph 7.3, at any time
after two (2) years from the Completion Date for each Plant and
prior to the expiration of the Initial Period hereof, by giving AIR
LIQUIDE at least a twelve (12) months prior written notice of
termination. Upon the effective date of such termination and as a
condition thereof, HSS shall pay to AIR LIQUIDE a lump sum
cancellation fee (prorated for fractional parts of a year)
calculated as follows:
Residual Life of the Initial Period Cancellation Fee Expressed As the
----------------------------------- Monthly
-------
From the Plant Completion Date Facility Fee Multiplied By
------------------------------ --------------------------
8 years 30 Months
7 years 26 Months
6 years 22 Months
5 years 17 Months
4 years 14 Months
3 years 10 Months
2 years 5 Months
1 year 3 Months
X. Amendment
Except as amended herein above the Agreement dated as of the 22nd day of
September, 1992 remains in full force and effect, as if set forth and
incorporated herein.
IN WITNESS WHEREOF, the parties have hereunto set their hand before
witnesses as of the date and year first above written.
XXXXXX CORPORATION AIR LIQUIDE AMERICA
SEMICONDUCTOR SECTOR CORPORATION ELECTRONICS
PER: [illegible] PER: [illegible]
------------------------------- -----------------------------------
TITLE: Sr. Mgr. Cont. Admin. TITLE: VP - Electronics
----------------------------- ---------------------------------
WITNESS: [illegible] WITNESS: /s/ Xxxxx X. Xxxxxxxxx
--------------------------- -------------------------------
Exhibit A
Compressed Dry Air Specifications
Flow Rate: 2,000 scfm +/- 4%
Pressure: 125 psig +/- 5 psig
Purity: -70 degrees F dew point
Exhibit B
o List of major equipment
o Two identical Sullair Air Compressor with 600 HP motors (one for
compressed dry air, one for the nitrogen generator (Plant #3)
o Two compressed dry air dryers sets
o Warm skid for air pretreatment for nitrogen generator
o Air Distillation cold box
o Back-up vaporizer for nitrogen
o Filter skid for nitrogen
Exhibit C
Estimated Utilities provided by HSS to Air Liquide Plant #3 and Compressed Dry
Air System
o Electrical Power
o at 4160 volts 3 phases, 60 cycles and at 480 volts 3 phase 60 cycles
o Expected total Operating demand: 900 KW +/- 4% for 40,000 scfh of
nitrogen and 2,000 scfm of compressed dry air.
o Cooling Water None
o Liquid Nitrogen 780 scfh
o Potable water, sewage, telephone and data lines
