*** Certain information in this
Exhibit has been omitted and filed
separately with the SEC. Confidential treatment has been requested
with
respect to the omitted portions.
2009 LIVESTOCK PRODUCTS
DISTRIBUTION AGREEMENT
This Livestock
Products Agreement (“Agreement”) effective as of
January 1, 2009 (“Effective Date”) is made by and
between Pfizer Inc., 812 Springdale Drive, Exton, PA 19341
(“Pfizer”) and, Professional Veterinary Products, Ltd.,
10077 South 134 th Street, Omaha, Nebraska 68138
(“PVPL”).
WHEREAS, PVPL
is in the business of buying and selling animal health products and
servicing customers for those products, and
WHEREAS, PVPL
and Pfizer wish to set forth the terms of their relationship
related to the purchase and supply of such products,
NOW, THEREFORE,
in consideration of the promises and covenants contained herein,
the parties hereby agree as follows:
“PARTICIPATING CUSTOMERS” shall mean
customers from the list of customers approved by Pfizer who have
entered into a Leaders Edge Agreement with Pfizer.
“Products” shall mean the Pfizer
cattle and swine products sold to PVPL by Pfizer pursuant to this
Agreement (and referenced in Schedule A to this
Agreement).
“Sales
Out” shall mean the reported sales by PVPL to Covansys and
accepted by Pfizer.
“Strategic Accounts” shall mean all
those PARTICIPATING CUSTOMERS listed in Schedule B
hereto,
1.
(a) Pfizer shall continue to promote its Products to certain
select customers in the livestock field. The parties agree that
each time a PARTICIPATING CUSTOMER selects PVPL as their supplier
and to service that customer’s account, Pfizer shall send to
PVPL a Pfizer Suggested Resale Price List which shall specify the
Pfizer Products and the Pfizer suggested resale prices quoted to
such PARTICIPATING CUSTOMER (hereafter “SUGGESTED RESALE
PRICE LIST”). Each such SUGGESTED RESALE PRICE LIST shall be
incorporated into and become part of this Agreement. Please find
the current SUGGESTED RESALE PRICE LIST listed on Schedule C
hereto. Also included
on
Schedule C is the current Pfizer Livestock Distributor
Pricing. The Products and suggested resale prices are subject to
change at any time in Pfizer’s sole discretion upon [***]
prior written notice.
(b) Pfizer
reserves the right to add or delete PARTICIPATING CUSTOMERS or
Strategic Accounts at any time at Pfizer’s sole discretion.
Pfizer will provide written notice to PVPL of any changes. Pfizer
will notify PVPL of any (i) additions to the Strategic
Accounts list within twenty-four (24) hours of Pfizer’s
receipt of the customer contract and (ii) removals from the
Strategic Accounts list within four (4) business days prior to
the removal effective date.
2.
(a) PVPL represents and warrants that for the purposes of this
Agreement, it is in the business of purchasing Products from Pfizer
for the sole purpose of resale and distribution, is registered
within the state(s) with which it does business, is compliant with
all pharmacy and distribution licensing requirements within the
state(s) with which it does business, and is compliant with and
capable of participating in Electronic Data Interchange
(EDI).
(b) PVPL agrees to
purchase from Pfizer, at credit terms agreed to between the parties
and as may be further set forth on Pfizer’s invoices,
Products sufficient to fulfill demand from all customers to whom
PVPL will sell Products in the quantities desired by the
customers.
(c) PVPL agrees to
maintain an inventory of Products equal to [***] Demand but
excluding all Products indicated on Schedule A as ineligible
for RSA payments. For purposes of this Agreement
“Demand” shall mean [***].
All Products shall
count towards the amount held in inventory by PVPL. PVPL and Pfizer
agree to act in good faith to resolve any material differences in
the on hand inventory calculations.
(d) Pfizer
reserves the right to allocate purchases such that PVPL may not
purchase more than [***]. Exceptions must be approved by
Pfizer’s New York headquarters.
(e) PVPL agrees
that all sales of Pfizer Products from PVPL to a PARTICIPATING
CUSTOMER shall reflect the specific prices for each Product
provided for in that PARTICIPATING CUSTOMER’S most recent
SUGGESTED RESALE PRICE LIST. In the event that the price listed on
a PARTICIPATING CUSTOMER’S most recent SUGGESTED RESALE PRICE
LIST for any particular Product is lower (at the time of
consummation of a sale of such particular Products between PVPL and
that PARTICIPATING CUSTOMER) than the price paid by PVPL to Pfizer
for such Product, Pfizer agrees to credit PVPL’s account for
the amount of such difference.
2
3. Nothing
herein contained shall create or be deemed to create any
relationship between the parties other than as specifically
provided for herein. No employment, partnership, specific or
general agency relationship shall exist unless specifically
provided for in writing between the parties. PVPL shall not
represent, directly or indirectly, expressly or by implication,
that any such relationships exist and/or that PVPL has any
authority except as set forth in this Agreement.
4. PVPL shall
use commercially reasonable efforts to provide appropriate service
to the customers to whom PVPL will sell hereunder. For customers
serviced pursuant to this Agreement, PVPL shall:
(a) Store its
inventory of Pfizer Products under conditions (including
refrigeration where appropriate) in accordance with package
labeling or other written instructions from Pfizer to ensure that
such Products retain their potency, purity, quality, and
identity;
(b) Provide to
Covansys by the close of business on Friday of each week an
inventory report covering all Product inventory purchased from
Pfizer and setting forth in dollars at PVPL’s acquisition
cost from Pfizer the amount of inventory by species. PVPL agrees
that Pfizer shall have the right, upon reasonable advance notice
and during business hours to audit inventory in the possession of
PVPL to confirm compliance with this paragraph 4(b) and to confirm
the accuracy of the data contained in the report;
(c) 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 Product sku that PVPL
sells;
(d) Provide Sales
Out data, which shall include Leaders Edge and Non-Leaders Edge
sales, to Covansys within ten (10) working days of the date of
each invoice. PVPL will use its best efforts to ensure Sales Out
data integrity and timeliness:
(e) Submit all
orders to Pfizer via EDI. EDI report 867 is the acceptable
format:
(f) Establish any
service fee or other charge or discount to any customer including
PARTICIPATING CUSTOMERS for Pfizer Products independently and at
its sole discretion;
(g) Provide
regularly scheduled delivery service to its customers and use
commercially reasonable efforts to anticipate its customers’
requirements for Pfizer Products. In the event Pfizer delivers any
product order to PARTICIPATING CUSTOMERS (drop ship), no
consideration shall be payable to PVPL for that order under
paragraph 5 below, provided that Pfizer will pay PVPL
3
for any drop
ship if such shipment is made necessary by the unavailability of
Pfizer Products;
(h) PVPL agrees
that credit limits established by Pfizer shall be subject to change
upon written notice by Pfizer in its sole discretion and that no
Product shipments will be made to PVPL in excess of the established
credit limits;
(i) Invoice
customers in an accurate and timely manner;
(j) Refer to that
PARTICIPATING CUSTOMERS SUGGESTED RESALE PRICE LIST on each invoice
for Pfizer Products:
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