EX-10.5 FIRST AMENDMENT TO CONTRACT SALES AGRMT



 





EXHIBIT 10.5




* Certain portions of this exhibit have been omitted pursuant to a request for

confidential treatment which has been filed separately with the SEC.




FIRST AMENDMENT TO



CONTRACT SALES AND SERVICES AGREEMENT




     This First Amendment to Contract Sales and Services Agreement (the “Amendment”),
between Cardinal Health PTS, LLC (“Cardinal Health”) and Cumberland Pharmaceuticals, Inc.
(“Cumberland”) is entered into by and between Cardinal Health and Cumberland to modify
the terms of the Contract Sales and Services Agreement between the parties dated May 16,
2006 (“Agreement”). All capitalized terms used in this Amendment shall have the meaning
ascribed to them in the Agreement.




	1.	 	Amendments.






	 	A.	 	Section 2.1 of the agreement is hereby amended to the add the following
to the end of Section 2.1:
	 
	 	 	 	In addition to the twenty-four Representatives dedicated to Detailing Products
for Cumberland under this Section, Cardinal Health shall also provide Cumberland
with access to a syndicated sales force which will provide Details for
Cumberland products as well as products of other Cardinal Health customers
(“Syndicated Sales Force”). Upon agreement of the parties, the Syndicated Sales
Force shall provide Details in accordance with terms set forth in amendments to
Schedule 3.1 of this Agreement. Such amendment shall set forth the details of
the Details, priority of Details, Products, services and fees to be provided by
Cardinal Health through the Syndicated Sales Force. The provisions of Sections
2.3(a) and 3.2 shall not apply with respect to the Syndicated Sales Force.
Cumberland agrees that it will not recruit, solicit or hire any Representative
which is a member of the Syndicated Sales Force during the Term of this
Agreement and for one year thereafter.
	 
	 	B.	 	Section 2.2 of the Agreement is hereby amended to add the following to
the end of Section 2.2:
	 
	 	 	 	The two Managers shall be responsible for oversight of the dedicated sales force
and not the Syndicated Sales Force. The Syndicated Sales Force shall continue to
be managed by individuals appointed by Cardinal Health to manage the Syndicated
Sales Force.
	 
	 	C.	 	Schedule 3.1 is hereby amended to add the
following at the end:
	 
	 	 	 	SYNDICATED SALES FORCE
	 
	 	 	 	Cardinal Health’s Syndicated Sales Force will make Calls on Target Customers
identified by Cumberland within the territory currently served by the
Syndicated Sales Force. The Syndicated Sales Force will Detail up to 3
Cumberland products during calls that are dedicated exclusively to Cumberland.
For purposes of this Agreement, a “Call” means a visit by a Representative or
Manager to a Target Customer in which multiple Products shall be Detailed to
the Target Customer, with the understanding that a small number (less than
10%) of Calls may not involve the




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	 	 	 	Detailing of all required Products (i.e., where Target Customers will not listen
to all Details).
	 
	 	 	 	The Call schedule shall begin on July 1, 2006 and end on June 30, 2007. Cardinal will
deliver [***] during this period. The service fee schedule will be as follows:





	 	 	 
	Month	 	Invoice Amount
	July, 2006
	 	37,500
	August
	 	37,500
	September
	 	37,500
	October
	 	37,500
	November
	 	37,500
	December
	 	37,500
	January, 2007
	 	37,000
	February
	 	37,500
	March
	 	37,500
	April
	 	37,500
	May
	 	37,500
	June, 2007
	 	37,500
	 
	 	 
	 
	$450,000	 







	 	 	 	Cardinal Health will invoice Cumberland the amount set forth in the above table on the
last day of each month for service fees.
	 
	 	 	 	Cardinal Health will also have the ability to earn up to [***] in performance incentive
for mutually agreed upon sales achievement levels on the target audience.






	 	 	The following expenses shall be direct pass-through to Cumberland for the syndicated program:
	 
	 	 	Actual travel expenses for all required participation in any subsequent POA meetings.
	 
	 	 	Actual promotional expenses and percentage of representative sample storage cost. The
parties will agree upon and manage to a budget based upon marketing programs and storage
requirements.
	 
	2.	 	Effective Date. This Amendment shall be effective upon full execution hereof
(“Effective Date”). Except as otherwise amended herein, the terms and conditions of the
Addendum shall remain in full force and effect.





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	 	 	CUMBERLAND PHARMACEUTICALS, INC.	 	 	 	CARDINAL HEALTH PTS, LLC.
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	By:
	 	/s/ James D. Aderhold, Jr
	 	 	 	By:
	 	/s/ Thomas G. Dimke
	 

	 	 	 	 
	 	 	 	 	 	 
	 

	 	Name:
	 	James D. Aderhold, Jr
	 	 	 	Name:
	 	Thomas G. Dimke
	 

	 	Title:
	 	V-P
	 	 	 	Title:
	 	SVP/GM
	 

	 	Date:
	 	7/13/06
	 	 	 	Date:
	 	7/19/06







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