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Credit and Payment Details

Payment Terms for Credit Accounts

Payment Terms: Monthly, Net 10 Days Purchases invoiced from the 1st through the end of the month are due by the 10th of the next month.

AmerisourceBergen Drug Corporation (“ABDC”) may change available payment terms from time to time. ABDC may adjust Price of Goods for different payment terms to reflect ABDC cost of funds and any resulting credit risk. Subject to credit approval, Applicant may request changes to payment terms upon thirty (30) days written notice prior to the beginning of a calendar month.

If payment is delinquent, ABDC may, in addition to ABDC’s right to exercise other remedies, withhold any credits or payments to Applicant, assess a per-day late payment fee of the lower of 0.05% (18%/360) or the maximum rate permitted by law on the outstanding balances until paid, beginning on the first (1st) business day after such due date, and may invoice a $50 processing fee for any dishonored payment.

 

Credit Agreement for Accounts with Greater Than $25,000 of Credit

This Credit Agreement, together with the credit application submitted by Applicant, any Prime Vendor Agreement or other servicing agreement, and stated invoice terms, constitute an agreement between Applicant and AmerisourceBergen Drug Corporation (“ABDC”). Applicant understands and agrees to the following terms and conditions of sale:

1. Payment Terms. If Applicant enters into a Prime Vendor Agreement or any similar form of distribution agreement (“PVA”), the specific payment terms are as stated in such agreement or in Applicant’s executed Payment Terms and Methods form, i.e., Credit Card, EFT or Biller Direct. Otherwise, specific payment terms are stated on the invoice delivered to Applicant. Applicant agrees to pay for all purchases, fees and other charges incurred by Applicant or an authorized user on any account of the Applicant. All payments must be deposited to ABDC account during normal business hours by the date due. Prices quoted include a discount in anticipation of payment within terms. Should payments be deposited to ABDC account later than the due date, or if the payment is dishonored, ABDC will invoice Applicant for the unearned discount. A processing fee of $50 will be invoiced for each dishonored payment. If payment is delinquent, ABDC may, in addition to ABDC right to exercise other remedies, (a) withhold any credits or payments to Applicant, (b) assess a per-day late payment fee of the lower of 18% per annum or the maximum rate permitted by law on the outstanding balances until paid, beginning on the first (1st) business day after such due date and/or (c) adjust future Price of Goods to reflect Applicant’s payment history. Applicant agrees to promptly pay when invoiced any and all denied chargebacks for disallowed/ineligible contract pricing, and to look solely to the relevant manufacturer(s) and/or group purchasing organization(s) or buying group(s) for redress. Billing disputes must be filed with ABDC Accounts Receivable Department by the earlier of one year after receipt of the first statement containing the amount in dispute or the shorter period set by a manufacturer for chargebacks. Otherwise, Applicant will be deemed to accept the accuracy of such statements and to waive its right to dispute the amount. Applicant acknowledges and understands that ABDC has the absolute right to change pricing or payment terms, require full or partial payment in advance or suspend delivery of products to Applicant without any liability being incurred by ABDC. Drivers and ABDC employees cannot accept payment. Drivers are not authorized to verify contents or quantities of packages. Applicant agrees that a receipt signed by a driver for any tote or package does not constitute evidence of the contents or value of the package. All orders of controlled substances and listed chemicals are subject to ABDC’s Suspicious Order Monitoring Program (“OMP”). Orders identified by the OMP may be rejected and may result in future ordering restrictions.

2. Security Agreement. To secure all of Applicant’s existing and future liabilities to ABDC and its affiliates, including the repayment of any amounts that ABDC may advance or spend for the maintenance or preservation of the Collateral (as defined below) or otherwise (collectively, the “Obligations”), Applicant grants to ABDC a security interest in the following personal property, wherever located, and now owned or hereafter acquired or arising (collectively, the “Collateral”): All of Applicant’s (a) Accounts; (b) Inventory; (c) Equipment; and (d) General Intangibles. All capitalized terms used herein and not defined have the meaning set forth in the Uniform Commercial Code as in effect in any jurisdiction in which any of the Collateral may at the time be located (the “UCC”). Applicant hereby grants to ABDC an irrevocable power of attorney coupled with an interest for the purpose of exercising and perfecting any and all rights and remedies available to ABDC at law and in equity. ABDC may at any time enforce Applicant’s rights against Account debtors and Obligors. Applicant has the risk of loss of the Collateral. Applicant will not make any sales, leases or other disposition of any of the Collateral except in the ordinary course of business.

3. Covenants. (a) Applicant certifies that any information provided in the Credit Application or otherwise requested by ABDC is true and complete. (b) Applicant will provide ABDC with such financial information as may be requested by ABDC, and Applicant certifies that any such information will be true and complete. (c) Applicant will immediately notify ABDC of any change in its state of formation; the location or ownership of, or any intent to sell, close or materially modify its business operations; any name change or change of business form; and any legal action that in the event of an unfavorable outcome would jeopardize the ongoing viability of Applicant. (d) Upon reasonable notice, Applicant will allow ABDC or any other third-party engaged by ABDC access to Applicant’s premises to inspect the Collateral and Applicant’s books and records. (e) Applicant will maintain insurance sufficient to insure the Collateral. (f) Applicant will comply with all applicable laws, including reporting or reflecting discounts, rebates and other price reductions pursuant to 42 USC §1320a-7b(b)(3)(A) and all ABDC policies. (g) The obligations, representations and covenants of Applicant to ABDC under this Credit Agreement will survive until all Obligations are indefeasibly paid in full. (h) Applicant is responsible for any applicable sales tax and other charges imposed by federal, state, local or foreign governments on manufacture, sales, shipment, import, export or use of products or services (other than ABDC’s income taxes). Applicant will provide applicable exemption certificates to ABDC.

4. Events of Default. The occurrence of any of the following will be an Event of Default under this Credit Agreement: (a) Applicant fails to pay when due any amount owing to ABDC or its affiliates; (b) Applicant fails to comply with any of the provisions or covenants of this Credit Agreement or any other agreement now existing or hereafter entered into between Applicant and ABDC or its affiliates; (c) Applicant makes any representation or warranty in this Credit Agreement, the credit application to which it is attached, any other agreement now existing or hereafter entered into between Applicant and ABDC or its affiliates, or in any financial statement delivered to ABDC or its affiliates that is untrue or incomplete in any aspect that ABDC or its affiliates deems to be material; (d) Applicant transfers or disposes of any of the Collateral other than in the ordinary course of business; (e) Applicant, voluntarily or involuntarily, becomes subject to any proceeding under the Bankruptcy Code or any insolvency or receivership proceeding under federal or state law; (f) Applicant discontinues in the business presently operated by it for a period of more than ten (10) consecutive days; (g) The death or incapacity of Applicant (if applicable), or any guarantor of the Obligations or the dissolution or liquidation of Applicant; (h) The sale or transfer of the business of Applicant, in whole or in part, or a “Change in Control” in Applicant; or (i) ABDC determination there has been a material adverse change in the business, or financial condition of Applicant or any guarantor of the Obligations or the occurrence of an event expected to result in such a material adverse change. “Change in Control” means the sale or other transfer of 25% or more of Applicant’s assets; or the voting equity or other voting interest in Applicant.

5. Remedies Upon Default. Upon the occurrence of an Event of Default, ABDC may (a) accelerate and declare all Obligations immediately due and payable without demand or notice; (b) exercise all rights and remedies of a secured party under the UCC; and (c) exercise all other rights and remedies available to ABDC at law or in equity. Without limiting ABDC other legal rights, ABDC may exercise a right of setoff against amounts due Applicant from ABDC or any of its affiliates. The rights and remedies provided in this Credit Agreement, in any other agreement between ABDC and Applicant or afforded by law or equity are cumulative and may be exercised concurrently, independently or successively. ABDC will not be deemed to have elected or waived any other remedies by the exercise of one or more remedies.

6. Costs and Expenses. Applicant agrees to pay all reasonable attorney fees and expenses or costs incurred by ABDC in enforcing its rights to collect amounts due from Applicant and, until paid, such fees, expenses and costs will be additional Obligations under this Credit Agreement.

7. Equal Credit Opportunity Act. The Federal Equal Credit Opportunity Act and similar state laws prohibit creditors from discriminating against credit applicant on the basis of race, color, religion, national origin, sex, sexual orientation, marital status, familial status, age, because all or part of the applicant’s income derives from any public assistance program; or because the applicant has in good faith exercised any right under the Consumer Credit Protection Act. The federal agency that administers compliance with this law is the Federal Trade Commission, Equal Credit Opportunity, Washington, D.C. 20580.

8. Time to Assert Claims, Limitation on Damages. Any claim against ABDC will be barred unless commenced within one (1) year from the date the cause of action has accrued. ABDC will not be liable for special, incidental or consequential damages of any type.

9. Governing Law. This Credit Agreement is governed by the internal laws and regulations of the Commonwealth of Pennsylvania, without reference to conflict of laws principles.

10. Waiver of Jury Trial. THE PARTIES WAIVE ANY RIGHTS THEY MAY HAVE TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED ON OR ARISING FROM THIS CREDIT AGREEMENT.

11. Successors and Assigns. This Credit Agreement is for the benefit of, and binds the heirs, successors and assigns of, each party; provided, however, Applicant may not assign this Credit Agreement without the prior written consent of ABDC.

12. Complete Agreement. This Credit Agreement cannot be modified except by writing and signed by the party or parties to be bound. Nothing herein is intended to amend the terms of any outstanding loan transaction between Applicant and ABDC or to in any way diminish, relinquish or terminate any of ABDC rights to previously-provided collateral intended to secure any obligations of Applicant to ABDC or its predecessors including, without limitation, any guaranty, letter of credit or other forms of collateral. If any provision of this Credit Agreement is held to be invalid, illegal or unenforceable under any applicable law, such term, covenant or condition will be deemed severable and the remainder of this Credit Agreement will be unaffected. This Credit Agreement may be executed in counterparts, each of which shall constitute an original, but all taken together shall constitute a single contract. Delivery of an executed counterpart of a signature page to this Credit Agreement by facsimile or in electronic (i.e., “pdf” or “tif”) format shall be effective as delivery of a manually executed counterpart of this Credit Agreement.

 

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