EXHIBIT 10.9
TRANSITION
AGREEMENT
This TRANSITION AGREEMENT (the
“Agreement”) is made effective the 26th day of March,
2008, among APOTHECARYRX, LLC, an Oklahoma limited liability
company (the “Buyer”), PENDERGRAFT DRUGS, INC., an
Oklahoma corporation (the “Company”) and GARY NICHOLS,
an individual (“Nichols” and together with the Company,
the “Seller”).
WHEREAS, pursuant to the Pharmacy Purchase
Agreement dated effective March 24, 2008, (the “Purchase
Agreement”) between the Buyer and the Seller, the Buyer
purchased the Seller’s pharmacy business in Oklahoma City,
Oklahoma, known as “Professional Discount Pharmacy”
(the “Business”) effective on the date hereof;
and
WHEREAS, the Seller and the Buyer desire to
foster a smooth transition of the Business from the Seller to the
Buyer and, in the interests of facilitating such transition, the
Buyer desires to use the Seller’s Licenses (as hereinafter
defined) to operate the Business for a short period of time after
the Closing Date, and the Seller is willing to allow the Buyer to
use the Seller’s Licenses to operate the Business for a short
period of time after the Closing Date, pursuant to the terms and
conditions of this Agreement.
NOW, THEREFORE, in consideration of the
foregoing and the mutual covenants and agreements hereinafter set
forth, and in consideration of the execution and performance of the
Purchase Agreement, the parties hereto agree as follows:
1.
Definitions . Capitalized terms used and not defined
herein shall have the meanings set forth in the Purchase
Agreement.
2.
Transition Services . Commencing at the Time of
Transfer and continuing until the termination of this Agreement,
the Buyer shall be entitled to utilize, in connection with its
operation of the Business and in strict accordance with the terms
of this Agreement, the following permits, licenses, registrations
or certifications of the Seller related to the Business
(collectively, the “Licenses”):
2.1.
Oklahoma Pharmacy License;
2.2.
Oklahoma Narcotics Registration;
2.3.
Drug Enforcement Agency Registration;
2.4.
National Council for Prescription Drug Programs Provider Number;
and
2.5.
Credit Card Services.
To
effect the foregoing authorization, on the Closing Date, the Seller
will execute the Limited Power of Attorney in the form attached at
Exhibit “A” authorizing the Buyer to act on the
Seller’s behalf in connection with the Licenses, and other
documents, if any, as may be required or requested by a government
agency, including, without limitation, powers of attorney.
In
addition, during the term of this Agreement,
the Seller agrees to keep open the bank accounts used for payments
from insurance companies, Medicare, Medicaid and credit card
services (whether one or more, the “Accounts”) and
furnish to the Buyer all information regarding the Accounts and
payments by third parties to the Accounts so that the Buyer may
perform the accounting described in paragraph 5 below.
3.
Termination of Right to Use Licenses . The
Buyer’s right to use the Licenses will terminate upon the
written notice of either party upon the earlier of:
(a) the issuance to the Buyer of the same types of permits,
licenses, registrations or certifications as the Licenses (the
“Required Licenses”); or (b) sixty (60) days from
the Closing Date; provided, in the event that the Buyer has not
obtained the Required Licenses within the required time period, the
term of this Agreement and the Power of Attorney will be extended
by twenty (20) days if (i) the Buyer has not breached and is
not in default of the terms of this Agreement, the Purchase
Agreement or any document executed in connection therewith, and
(ii) the Buyer is actively seeking and using best efforts to
obtain the Required Licenses as promptly as possible.
4.
Will Call Prescriptions . The company performing the
Inventory will account for all orders at the Business for
prescriptions placed but not paid for prior to the Time of Transfer
(“Will Call Prescriptions”) and determine the cash
amount owed by customers for Will Call Prescriptions (the
“Will Call Receivables”). On the Closing Date,
the Buyer will pay the Seller the amount of the Will Call
Receivables. All Will Call Receivables will be the property
of the Buyer. All other receivables from third parties in
connection with the Will Call Prescriptions will be the property of
the Seller subject to paragraph 5 of this Agreement.
5.
Third Party Receivables . All accounts receivable
generated prior to the Time of Transfer other than the Will Call
Receivables (the “Seller Receivables”), will be the
property of the Seller. The Buyer will collect the Seller
Receivables on behalf of the Seller and furnish an accounting of
all Seller Receivables (reconciled to the transaction generating
such Seller Receivables) to the Seller on a monthly basis.
The Buyer will pay the Seller all collected Seller Receivables on a
weekly basis. The Buyer will conduct the foregoing
collection, accounting and recon
