PRIMARY SOURCE PROPOSAL
FOR
HORIZON PHARMACIES, INC.
BY
XXXXXX XXXXXXXX
BERGEN XXXXXXXX DRUG CO.
JANUARY 19, 1995
AGREEMENT PERIOD
----------------------
A. THIS CONTRACT BECOMES EFFECTIVE JANUARY 1, 1995 AND WILL CONTINUE EACH
YEAR THEREAFTER. UPON THE MUTUAL AGREEMENT OF BOTH HORIZON PHARMACIES. INC.
AND BBDC.
B. IN THE EVENT BBDC'S PRODUCTION OR DELIVERIES OF GOODS ARE PREVENTED,
IMPAIRED, REDUCED OR RESTRICTED BY REASON OF FORCE MAJEURE, LABOR DISPUTES,
FIRE, ACTS OF GOD, OR ANY OTHER SIMILAR OR DISSIMILAR CAUSE BEYOND ITS
CONTROL, INCLUDING BUT NOT LIMITED TO THE UNAVAILABILITY OF SUCH GOODS,
TRANSPORTATION, SHORTAGES OF MATERIALS OR FUEL, DELAY IN DELIVERY OR FAILURE
TO DELIVER BY BBDC'S SUPPLIERS, LOSS OF FACILITIES OF DISTRIBUTION, THE
VOLUNTARY FOREGOING OF THE RIGHT TO ACQUIRE OR TO USE ANY MATERIALS IN ORDER
TO ACCOMMODATE OR COMPLY WITH THE ORDERS, REQUESTS, REGULATIONS,
RECOMMENDATIONS OR INSTRUCTIONS OF ANY GOVERNMENTAL AUTHORITY (WHETHER IN
FURTHERANCE OF NATIONAL DEFENSE OF WAR ACTIVITIES OR TO MEET ANY OTHER
EMERGENCY), OR THE COMPLIANCE WITH ANY LAW, ORDER, RULING, REGULATION,
INSTRUCTION OR REQUIREMENTS OF ANY GOVERNMENTAL AUTHORITY OR ANY POLITICAL
SUBDIVISION OR AGENCY THEREOF, OR FOR ANY OTHER CAUSE WHETHER OF THE SAME OR
DIFFERENT CHARACTER HEREIN SPECIFIED BEYOND THE REASONABLE CONTROL OF THE
PARTY AFFECTED THEREBY, BBDC, WITHOUT LIABILITY OR OBLIGATION, MAY REDUCE OR
ELIMINATE THE QUANTITIES HEREIN SPECIFIED IN PROPORTION TO THE PREVENTION,
IMPAIRMENT, REDUCTION OR RESTRICTION UPON BBDC'S PRODUCTION OR DELIVERY, ON A
PRO RATA BASIS AMONG ALL USERS OF ITS GOODS DURING THE PERIOD OF SUCH
DISABILITY. IN ANY SUCH CASE, THE GOODS WHICH BBDC IS UNABLE TO SUPPLY SHALL
BE ELIMINATED FROM THIS CONTRACT BY WRITTEN NOTICE DESCRIBING THE AMOUNTS
ELIMINATED AND THE ESTIMATED TIME PERIOD DURING WHICH DELIVERIES ARE TO BE
SUSPENDED; AND BBDC SHALL BE RELIEVED OF ANY LIABILITY WITH RESPECT THERETO
DURING SUCH TIME BBDC MAY NOT BE ABLE TO DELIVER THE GOODS IN QUESTION.
C. IT IS UNDERSTOOD THAT THIS AGREEMENT MAY BE TERMINATED BY EITHER PARTY
FOR JUST AND REASONABLE CAUSE WITH A 30 (THIRTY) DAY WRITTEN NOTICE.
X. THIS PROPOSAL IS VALID AS WRITTEN IF SIGNED AND RECEIVED BY BERGEN
XXXXXXXX DRUG COMPANY ON OR BEFORE JANUARY 31, 1995.
COST OF GOODS
-------------
ALL PRODUCTS WILL BE INVOICED WITH AN UPCHARGE RATE OF 5% FROM WHOLESALE
COST. HORIZON PHARMACIES, INC. COST THEN WILL BE REBATED TO AN UPCHARGE RATE
OF 0.8% ON A MONTHLY BASIS. WHOLESALE COST IS DEFINED AS MANUFACTURER
INVOICED COST BEFORE ALLOWANCES, DISCOUNTS, AND REBATES. PRODUCTS THAT DO NOT
QUALIFY FOR THIS PROGRAM ARE ITEMS THAT ARE INVOICED AT SUPERNET (ITEMS THAT
DO NOT HAVE AN APPLIED UPCHARGE.) TRUE QUALITY ITEMS ARE INVOICED AT A
SUPERNET RATE BUT DO QUALIFY FOR THE REBATE.
INVOICE PAYMENT TERMS
---------------------
INVOICES DATED THE 1ST THROUGH THE 15TH OF THE MONTH ARE DUE AND PAYABLE BY
THE 25TH OF THE SAME MONTH. INVOICES DATED THE 16TH THROUGH THE END OF THE
MONTH ARE DUE AND PAYABLE BY THE 10TH OF THE FOLLOWING MONTH. ALL OUTSTANDING
BALANCES ARE SUBJECT TO A 1.5% COST OF GOODS ADJUSTMENT. ADDITIONALLY ALL
REBATES AND UPCHARGE RATES ARE BASED ON THE STATED PAY TERMS AND ARE SUBJECT
TO CHANGE UPON NOTICE.
DELIVERY AND ORDER TIMES
------------------------
DELIVERY WILL BE PROVIDED 5 DAYS A WEEK, MONDAY THROUGH FRIDAY, IF AN ORDER
HAS BEEN ELECTRONICALLY PLACED BEFORE 7:00 P.M. THE PREVIOUS DAY. NARCOTIC
ORDERS REQUIRE AN ADDITIONAL 24 HOURS TO PROCESS AND CANNOT BE PROCESSED
UNTIL THE APPROPRIATE FORM HAS BEEN RECEIVED BY BERGEN XXXXXXXX.
AVAILABLE PROGRAMS AND SERVICES
-------------------------------
ORDER ENTRY DEVICE NO CHARGE
PRICE STICKERS NO CHARGE
USAGE REPORT (STORE SPECIFIC) NO CHARGE
USAGE REPORT (CONSOLIDATED) NO CHARGE
OTC/HABA ZONE PRICING $10.00/MO./STORE
DAILY RX PRICE UPDATES $50.00/MO./STORE
GOOD NEIGHBOR PHARMACY $65.00/MO./STORE
GROUP PURCHASING ORGANIZATION NO CHARGE
*CURRENT COMMITMENT BY STORE
SERVICE PRINCETON WINNSBORO CUERO
ORDER ENTRY DEVICE X X X
PRICE STICKERS X X X
USAGE REPORTS - ALL X X X
OTC ZONE PRICING X X X
DAILY RX PRICE UPDATES X X X
GOOD NEIGHBOR PHARMACY X X N/A
GROUP PURCHASING X X X
RETURNS, BILLING ERRORS, EXCHANGES AND SHORTAGES
-----------------------------------------------
ALL RETURNS SHALL BE INITIATED THROUGH THE ORDER ENTRY MACHINE BY STORE
ASSOCIATES. CREDITS WILL BE ISSUED IN ACCORDANCE WITH MANUFACTURERS POLICIES
AND THOSE ESTABLISHED BY THE NATIONAL ASSOCIATION OF WHOLESALE DRUGGISTS.
BERGEN XXXXXXXX DRUG COMPANY COMMITMENT
---------------------------------------
BERGEN XXXXXXXX IS COMMITTED TO THE CONTINUED GROWTH AND PROFITABILITY OF
HORIZON PHARMACIES, INC. AND LOOKS UPON THIS AGREEMENT AS A PARTNERSHIP. IT
IS BBDC GOAL TO ENSURE THAT HORIZON PHARMACIES, INC., AND ALL OF ITS
ASSOCIATES, UNDERSTAND THE CONCEPTS, APPLICATIONS, AND IMPLEMENTATION
PROCEDURES OF ALL AVAILABLE PROGRAMS AND SERVICES.
CONFIDENTIALITY
---------------
HORIZON PHARMACIES, INC. AND BERGEN XXXXXXXX DRUG CO. SHALL HOLD ALL
INFORMATION AS CONFIDENTIAL AND AGREE NOT TO SHARE ANY DOCUMENTS OR TRADE
SECRETS WITH ANY OTHER PARTY.
T.Q. PRODUCTS ON ONE PASS TO DIV. 30 SHIPPED FROM 30 - DIV. 2 TIMES A WEEK.
NEW TERMS
---------
1ST - EOM DUE BY 25TH OF NEXT MONTH PER X. XXXXX.
ALL REPORTS TO BE SENT TO XXXXXX XXXXXXXX AT DIV. 30.
THE TERMS OF THIS AGREEMENT HAVE BEEN APPROVED AND ACCEPTED.
/s/ Xxxx XxXxxx, President /s/ Xxx Xxxxx
----------------------------- -----------------------------
XXXX XXXXXX - PRESIDENT XXX XXXXX
/s/ Xx Xxxxxx, Vice President /s/ Xxxxxx XxXxxxxx
----------------------------- -----------------------------
SY SHAHID - VICE PRESIDENT XXXXXX XXXXXXXX
DATE 1/25/95 DATE 2/10/95
----------------------------- -----------------------------
HORIZON PHARMACIES, INC. BERGEN XXXXXXXX DRUG CO.
