Exhibit 10.22

Prime Vendor Agreement

 

This Prime Vendor Agreement (“Agreement”) is made as of April 1, 2007
(“Effective Date”) by AmerisourceBergen Drug Corporation, a Delaware corporation
(“ABDC”), and BJK, Inc., d.b.a. Chem Rx, a New York corporation (“Customer”).

 

A.            ABDC is a national distributor of pharmaceutical and other
products, including prescription (“Rx”) and over-the-counter (“OTC”)
pharmaceuticals, nutritional, health and beauty care (“HBC”) and home health
care ("DME”) products (“Product” or “Products”), and services (“Services”);

 

B.            Customer owns and operates a Facility in Long Beach, NY
(“Facility”); and

 

C.            The parties intend by this Agreement to set forth their
obligations to each other for an arrangement under which ABDC will provide
Products and Services to Customer (“Program”).

 

Now Therefore, the parties agree as follows:

 

1.             Pricing and Payment Terms

 

ABDC will be the Primary Vendor of all requirements of Customer’s Facility for
Products. Customer will pay, within terms, Product costs and Program fees
pursuant to payment terms in Exhibit “1” (“Pricing/Payment Terms”). “Primary
Vendor” means Customer purchases from ABDC no less than 50% of all prescription
pharmaceutical Products it purchases for Facility, as verified quarterly, and
meets minimum periodic purchase levels in Paragraph 3(A) of the Pricing/Payment
Terms. Orders for Products will be electronically transmitted (including
Schedule II controlled substances when allowed) and will describe Products that
ABDC will provide to customer, the quantity and designated delivery location.
All payment plans (except pre-pay) must be by electronic funds transfer (EFT).

 

2.             Pro Generics Program Participation

 

Customer may elect to participate in ABDC’s preferred generic formulary program
(“Preferred RX Options” or “PRxO Generics”) pursuant to requirements as amended
from time to time by ABDC. If participating, Customer will purchase no less than
0% of its purchases of the “Top 100” generic pharmaceutical Products from ABDC.
The Top 100 is a list determined from time to time by ABDC of more than one
hundred commonly used generic pharmaceutical Products. Customer authorizes ABDC
as its sole agent to develop and implement a generic pharmaceutical Product list
for the Term. Customer will purchase from ABDC each calendar quarter no less
than the minimum Net Purchase volume of generic pharmaceutical Products as set
forth in the Pricing/Payment Terms.

 

3.             Customer Locations & Deliveries

 

ABDC will deliver Products to each Facility six days a week (Monday   Saturday),
once a day except holidays and warehouse physical inventory days. Customer will
make all reasonable efforts to limit the size and quantity of the Saturday
order. Additionally, Customer will be entitled to one emergency delivery per
calendar quarter at no additional charge. Customer may be charged for each
additional emergency order. Facility means Customer’s pharmacy in Long Beach,
NY. Newly acquired facilities with existing agreements with other distributors
will become Facilities under this Agreement with the mutual consent of ABDC and
Customer upon the earlier of expiration of such existing agreement or the date
Customer may terminate such agreement, with or without cause, without breaching
it or paying a material penalty; provided, however, service to Facilities
outside ABDC’s normal service area (which does not include Alaska, Hawaii or
U.S. territories) may be subject to a delivery surcharge.

 

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4.             Fill Rates

 

A.            ABDC commits to a ninety-seven percent (97%) adjusted fill rate on
a chain-wide basis measured quarterly. The adjusted fill rates are calculated as
follows:

 

(a)           An item shorted on an original order will not be counted as a
short for the second time until 72 hours have passed.

 

(b)           Where only a partial quantity is received of an individual line
item, it will be a short only if fifty percent (50%) or less of the quantity
ordered is shipped.

 

(c)           On any new item, or an item previously not ordered by Customer, a
period of thirty (30) days will be given to add the item to ABDC’s inventory.
This period is computed from the date Customer places the original order and
provides estimates on usage.

 

(d)           The quantity of an item ordered in excess of one hundred twenty
percent (120%) of the most recent month’s order for such item on an aggregate
basis for all Customer facilities will not be considered short.

 

(e)           Manufacturer’s legitimate back orders, unavailability and other
shortages are not computed in determining the service level.

 

5.             Returned Goods Policy

 

Customer will only return Products to ABDC in accordance with ABDC’s standard
policy for returned Products (“Returned Goods Policy”), as amended from time to
time by ABDC. If Customer returns more than 3% of its OTC Net Purchases, or 3%
of its pharmaceutical Net Purchases in any month, Customer may be assessed an
additional restocking fee over any standard stocking fee in the Returned Goods
Policy or ABDC may adjust the Price of Goods or both. Customer will return only
Product purchased from ABDC for which Customer has submitted the invoice number
and date of purchase.ABDC may reject returns not accompanied by the invoice
number and date of purchase or that exceed in amount either the 3% return limit
or the amount on the referenced invoice number. ABDC reserves the right to
refuse all future returns from Customer in the event that Customer submits any
counterfeit Product for return.

 

6.             Additional Services & Provisions

 

Services are listed in Exhibit “2”. Terms, conditions and other provisions are
set forth in Exhibit “3” ("Provisions”). ABDC may, from time to time, develop
policies and procedures relative to new or existing Services offered to
customers, on an interim or as-needed basis. If ABDC develops such policies or
procedures or changes current ones, ABDC will notify Customer in writing at
least thirty (30) days before such changes are effective.

 

7.             Term of Agreement

 

Subject to Paragraph 5 of the Provisions, the Term will be from the Effective
Date until March 31, 2009 with two optional one year extensions. The Term will,
thereafter, be extended on a month-to-month basis until either party gives at
least ninety (90) days prior written notice to the other of its intention not to
extend this Agreement.

 

8.             Notices

 

Notices must be in writing and sent certified mail, prepaid, return receipt
requested, or sent by facsimile to the address or facsimile number below.
Parties may change this information by written notice to the other party.
Pursuant to the Telephone Consumer Protection Act of 1991, 47

 

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U.S.C. §227, Customer consents to receiving notices, including product updates,
recalls, new product launches and programs, advertisements and other marketing
materials by telephone facsimile (“fax”) machine from ABDC, its affiliates and
their related companies, to the fax number set forth below.

 

 

To Customer:

 

BJK, Incl., d.b.a. Chem Rx

 

 

790 Park Place

 

 

Long Beach, NY 11561

 

 

Attn: President

 

 

Fax:

 

 

 

To ABDC:

 

AmerisourceBergen Drug Corporation

 

 

100 Friars Boulevard

 

 

Thorofare, NJ 08086

 

 

Attn: James Rockefeller, Vice President Alternate Care Sales

 

 

Fax: 856 384 2194

 

 

 

With a copy to:

 

AmerisourceBergen Corporation

 

 

1300 Morris Drive

 

 

Chesterbrook, Pennsylvania 19087-5594

 

 

Fax: (610) 727-3612

 

 

 

 

8.             Exhibits

 

The following exhibits to this agreement are incorporated by this reference.

 

1

 

Pricing/Payment Terms

2

 

Value-Added Services

3

 

Provisions

 

 

 

In Witness Whereof, the parties have had a duly authorized officer, partner or
principal execute this Prime Vendor Agreement as of the Effective Date.

 

Customer:

 

ABDC:

BJK, Inc., d.b.a. Chem Rx

 

AmerisourceBergen Drug Corporation

 

 

 

 

 

 

By:

 

 

By:

 

Name:

 

 

Name:

 

Title:

 

 

Title: Vice President,

 

 

 

 

 

 

 

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