Exhibit 10.3
[*]
= Portions of this exhibit have been omitted pursuant to a
confidential treatment request. An unredacted version of this
exhibit has been filed with the Commission.
PFIZER EQUINE
PRODUCTS
MARKETING
AGREEMENT
This Agreement dated and effective as of
January 1, 2007 is made by and between Pfizer Inc , 235 East
42nd Street, New York, New York 10017 (hereinafter,
“PFIZER”) and MWI Veterinary Supply Co. , 651 South Stratford Drive, Suite 100,
Meridian, ID 83642 (hereinafter,
“MWI”).
1.
PFIZER hereby appoints MWI,
and MWI hereby accepts appointment, as a contract
distributor for PFIZER Products
set forth on Exhibit A (the “Products”), to purchase
from PFIZER and to resell for MWI’s own account as a
distributor, subject to the following terms and
conditions.
2.
MWI recognizes and agrees to
the following:
(a)
PFIZER has elected to work with
a select group of distributors that are committed to maximizing the
sale of the Products and to working closely with PFIZER to identify
market opportunities for both companies. The intent of this
Agreement is to attain that goal;
(b)
PFIZER intends to utilize this
group of distributors to sell the Products to customers below them
in the distribution chain and that PFIZER has, and may in the
future, run promotions
and other activities that would be seriously prejudiced if MWI
resells the Products to other PFIZER contract distributors,
non-employee agents or through brokers.
3.
Accordingly, MWI
shall:
(a)
use its reasonable best efforts
to sell the Products by focusing its primary effort at
reselling to horse owners, veterinarians and OTC retailers;
(b)
maintain a full-time outside
and inside sales force that will personally and actively solicit
sales of the Products and to pay such sales representatives
reasonable commission as MWI deems appropriate in its sole
discretion;
(c)
store and handle its inventory
of Products under conditions that will ensure that such
Products retain their potency, purity, quality, and identity;
(d)
MWI will provide PDA/EDI with
sales out data on each PFIZER sku MWI sells. MWI will provide to
Covansys its Health Industry Number, Customer Health Industry
Number, Pfizer product
number, transaction date, ship to zip code, number of units and
price with respect to each sale of product, and unit
inventories on each Pfizer sku that MWI sells. This information
should be sent to Covansys.
Sales out data shall be provided to Covansys within [*] of the date
of each invoice.
MWI will use its best efforts to insure sales out data integrity
and timeliness;
(e)
not sell the Products to other
PFIZER contract distributors provided such distributors are identified by PFIZER, nor
shall MWI sell the Products through brokers or non-employee
agents;
(f)
set its resale prices for the
Products independently and at its sole discretion;
(g)
cooperate fully with PFIZER by
actively participating in such strategy sessions as PFIZER
reasonably may require, for the purpose of developing programs to
increase use of the Products; and to cooperate fully with PFIZER in
implementing all promotions and sales campaigns for the
Products;
(h)
allow PFlZER’s
representatives to attend and actively participate in meetings
of MWI’s sales representatives;
(i)
MWI agrees that credit limits
established by PFIZER shall be subject to change
by PFIZER in its sole
discretion and that no shipments will be made to MWI in excess of
the established credit limits;
(j)
take no action, whether or not identified above, that would harm
the goodwill or name of PFIZER, or damage the interests of PFIZER
or the Products. For purposes of this Agreement
“Goodwill” shall mean the marketplace advantage of
customer patronage and loyalty developed with continuous business
under the same name over a period of time.
(k)
MWI shall immediately notify PFIZER in the event MWI obtains
information indicating that any
of the Products may have to be recalled either by virtue of
applicable law or regulation or good business judgment. PFIZER shall
control all efforts necessary to conduct any such recall. MWI shall
cooperate with PFIZER and MWI agrees to maintain adequate records
to conduct such recall, including the name, address and Product
purchases of all purchasers of PFIZER Products.
(l)
MWI may make use of the custom marketing program funding provided
for in Exhibit E
hereto.
(m)
Make payment to PFIZER [*] .
(n)
Provide to PFIZER by the close
of business on the last business day of each PFIZER Accounting
Period (as set forth in Exhibit F hereto) an inventory report
covering all inventory purchased from PFIZER and setting forth in
dollars at MWI’s acquisition cost from PFIZER the amount
of inventory by
species. MWI agrees that PFIZER shall have the right to
audit inventory in the possession of MWI to confirm compliance with this
paragraph 3 (n) and to confirm the accuracy of the data contained
in the report.
4.
PFIZER shall:
(a)
sell the Products to MWI at the prices in effect in the then
current published PFIZER
Animal Health Products Distributor Price List (hereinafter,
“Price List”). PFIZER also shall permit MWI to
participate in the distributor incentive programs offered by
PFIZER, in accordance with the terms of such programs.
PFIZER shall have the unrestricted right to revise the prices,
terms and conditions of the
Price List, and to add or delete Products or package sizes, without
advance notice to MWI, and the revisions shall be effective
on all orders submitted after the effective date of the price
revisions. In all cases of
orders received for other than immediate shipment, the price for
the Products shall be that in effect at the time of
shipment. PFIZER agrees to give MWI [*] advance notice of price
increases;
2
(b)
compensate MWI in accordance with Exhibits B, D and E hereto. In
the event that one Agreement
holder acquires or combines with another Agreement holder, the
purchase objectives will be adjusted accordingly for the
purpose of determining incentives earned.;
(c)
allow MWI credit on prepaid
returns in acc
