**EXHIBIT 10.24**

 

**BUSINESS MANAGEMENT AGREEMENT**

 

**THIS BUSINESS MANAGEMENT AGREEMENT**(“Agreement”), made this _____ day of February, 2014 by and among:

 

**MAIN AVENUE PHARMACY, INC.**, a New Jersey corporationwith a business location at 1094 Main Avenue, Clifton, NJ 07011 (hereinafter “Pharmacy”);

 

**AND**

** **

**SCRIPSAMERICA, INC.**, a Delaware corporation with itsprincipal offices located at 843 Persimmon Lane, Langhorne, PA 19047 (hereinafter “Scrips”)

 

**AND**

 

**IMPLEX CORPORATION**, a Nevada corporation with its registeredoffice located at 4650 Wedekind Road, Suite 2, Sparks, NV 89431-7722 (hereinafter “Implex”)

 

WITNESSETH THAT:

 

WHEREAS, Implex is entering into a certainagreement to purchase, over time, 100% of the issued and outstanding capital stock of Pharmacy, and the current owner of Pharmacy,Dmitriy Naydenko, desires to discontinue his business management functions, while continuing his legal responsibilities with respectto the compounding pharmacy operations pending completion of the sale/purchase and the licensing of Implex, but Implex is not ina position to provide business management functions, and Implex desires to secure third-party business management for the Pharmacy;

 

WHEREAS, Scrips is able to provide the businessmanagement for Pharmacy, including financial support for Pharmacy’s day-to-day operations and both Implex and Pharmacy desireto secure such services;

 

WHEREAS, the parties have discussed thesituation and have negotiated and reached certain understandings, for which they desire a document to formalize and evidence suchunderstandings;

 

NOW, THEREFORE, intending to be legally bound, and in consideration of the mutual promises and covenants containedherein, the parties have agreed, and do hereby agree, as follows:

 

1. ENGAGEMENT OF SCRIPS. (a) Implex, under the termsand conditions of this Agreement, hereby appoints, hires and engages Scrips to manage the day-to-day business operations of Pharmacy.

 

(b) Pharmacy, under the terms and conditionsof this Agreement, hereby appoints, hires and engages Scrips to manage its day-to-day business operations.

 

(c) Scrips, under theterms and conditions of this Agreement, hereby accepts the appointment and engagement to manage the Pharmacy.

 

 

2. PURPOSE OF ENGAGEMENT. The general purpose of theengagement of Scrips is to establish a management structure for the Pharmacy on behalf of Implex. However, the “managementstructure” for purposes of this Agreement shall not include any action or activity from which Scrips would be required tofile for, secure and maintain any federal or state license for the purchase, handling, processing and sale of controlled substances,but shall refer solely to such management as required for the day-to-day business operations of the Pharmacy. In the event of anyconfusion, reference is made to the limitations on Implex contained in the stock purchase agreement. Pending Implex’s purchaseof the ownership interest in Pharmacy, Dmitriy Naydenko shall continue the responsibilities for which a license is required, pendingImplex establishing its own structure and control of such activities and obtaining all necessary licenses.

 

(b) Scrips shall have no authority or power with respect tothose areas of the business activities of Pharmacy which require federal or state licensure and Scrips shall not interfere withthe management of the compounding pharmacy with respect to those areas.

 

3. NATURE OF ENGAGEMENT. (a) Scrips shall report to,act under the authority of, and follow the directives of, Implex as the owner of Pharmacy and Implex shall have full authorityto direct the management of Pharmacy.

 

(b) The parties are separate corporate entities. Nothing inthis Agreement is intended to form a partnership, joint venture, other entity or profit-sharing arrangement among the parties,nor, except as otherwise specifically provided, to give any party an interest in the assets, business, profits, losses, liabilities,obligations, and/or revenues of the other.

 

(c) Scrips is an independent contractor and shall be responsiblefor the conduct of management by its own employees, consultants and agents. Scrips shall be responsible for its own taxes, includingpayroll taxes, and all other costs and liabilities associated with its operations and its management of Pharmacy.

 

4. TERM. (a) The initial term of this Agreement shallbe from February 7, 2014 to January 31, 2019, unless sooner terminated pursuant to Paragraph 9 below.

(b) If, at September 30, 2018 this Agreement is still in effect,and Scrips is not in default under this Agreement, then Scrips shall have the option to continue this Agreement and relationshipfor a further term of five (5) years; *i.e.*, from February 1, 2019 to January 31, 2024.

 

5. DUTIES OF SCRIPS. (a) Upon the Initial Closing byImplex of its stock purchase agreement, Implex shall notify Scrips of such and thereupon Scrips shall assume the management ofPharmacy, including the financial management. Scrips shall provide the funds, to the extent necessary, to pay all costs and expensesincurred in the operation of the Pharmacy, including but not limited to labor, payroll taxes, fringe benefits, insurance repairs,maintenance and professional fees, as well as all financing costs and debt service pertaining to the financing obtained for operationof the Pharmacy, including specifically accounts receivable financing. Scrips shall open a bank account for Pharmacy, in the nameof Pharmacy, which Scrips shall control but to which Implex shall have signature authority and access. Scrips shall, from timeto time, in addition to the regular deposits of the funds of Pharmacy, when such deposits are inadequate, deposit such of its ownfunds as advances or loans, to Pharmacy, as necessary or desirable for the timely payment of Pharmacy’s payables. Scrips,from time to time, as available cash and timing permit, shall withdraw up to such amounts in repayment of its loans and advancesas Scrips shall determine. In general, Scrips shall be responsible for the timely cash management of Pharmacy.

 

 

(b) Scrips shall manage and supervise the operation of Pharmacy,in the name of Pharmacy, including, but not limited to:

(i) hiring, firing, training, supervising, setting payscales for and paying, all required Pharmacy personnel;

(ii) hiring, firing, supervising, negotiating pay andcommission scales for, and paying, all required sales and marketing personnel;

(iii) establishing and enforcing personnel, safety,controlled substance and environmental policies;

(iv) determining and establishing sources for productsand inventory needed for the operation of the Pharmacy and purchasing of same;

(v) establishing and applying quality controls on theoutput of the compounding Pharmacy;

(vi) maintaining, repairing, refurbishing and replacingall Pharmacy equipment, machinery, vehicles, fixtures, and leasehold improvements;

(vii) assisting Pharmacy and Implex in applying for,obtaining, re-applying for, and retaining all licenses, permits and other authorizations required for operation of the Pharmacyas a compounding pharmacy;

(viii) establishing, applying andenforcing all governmental workplace safety (e.g. OSHA) and environmental regulations and requirements;

(ix) insuring the Pharmacy, and all of its equipment,machinery, vehicles, fixtures, and leasehold improvements against damage or loss to the extent required by all lenders, but notless than full market value; and

(x) maintaining the Pharmacy and the security thereof.

 

6. OWNER’S DRAWS. (a) Implex shall be entitledto draw certain amounts, each month, commencing April 1, 2014 and continuing for the term of this Agreement, which amounts shalleither be paid over to Implex or paid to such persons and/or entities as Implex may direct. Such amounts shall be an AllowableDeduction for purposes of calculating the Management Fee payable to Scrips pursuant to Paragraph 7 following.

 

(b) Commencing April 1, 2014 and continuing to, and including,March 1, 2015, Implex shall be entitled to a monthly draw calculated as the total of (i) $26,654.44, (ii) $7,160.64, (iii) $13,187.88and (iv) a sum calculated as $30 per prescription processed by the Pharmacy during the preceding month, except that the paymentfor April 1, 2014 shall include all prescriptions processed since the First Closing by Implex.

 

(c) Commencing April 1, 2015 and continuing to, and including,March 1, 2016, Implex shall be entitled to a monthly draw calculated as the total of (i) $7,160.64, (ii) $ 1,666.66 and (iii),subject to sub-paragraph (e) following, a sum calculated as $30 per prescription processed by the Pharmacy during the precedingmonth.

 

(d) Commencing April 1, 2016 and continuing thereafter, Implexshall be entitled to a monthly draw calculated as $30 per prescription processed by the Pharmacy during the preceding month.

 

(e) At such time as the Pharmacy shall have processed 10,000prescriptions, the sum to be paid shall be reduced, commencing with the 10,001st prescription, to $10 per prescriptioninstead of $30.

 

 

7. COMPENSATION OF SCRIPS. In consideration for SCRIPSproviding (i) the financing of the day-to-day operations of Pharmacy and (ii) its management services hereunder, Pharmacy shallpay to SCRIPS a combined Financing Fee (including interest on all funds advanced or loaned) and Management Fee in an amount calculatedas ninety-seven percent (97%) of the Calculation Basis as defined herein (“Fee”). The Fee shall be calculated monthlybased upon the data from the preceding calendar month. The “Calculation Basis” is Pharmacy’s total receipts frompaid invoices during the preceding calendar month *(i.e., total revenue on a cash basis)* less the Allowable Deductions asdefined herein. The “Allowable Deductions” shall consist of (i) the owner’s draw as provided in Paragraph 6 above,(i) the purchase cost of the pharmaceutical products sold during the preceding calendar month, together with the related in-boundfreight and out-bound delivery costs, and the warehousing and storage costs allocated for such sold products, (iii) rent, CDR salaryper employment agreement, salesmen’s commissions and all other reasonable overhead and operating costs such as telephone,utilities, office supplies, travel and entertainment, etc., but shall exclude (iii) interest, (iv) income taxes, and (v) depreciation/amortizationand other non-cash deductions. The Fee calculated for each month’s Calculation Basis shall be drawn from the Pharmacy accountdescribed in Paragraph 5(a) at such times as Scrips shall determine, given Scrips’ responsibility for the tiomely cash managementof the Pharmacy. There shall be no carryback nor carryforward from month to month and no loss shall be distributed to SCRIPS. Inthe event of a subsequently discovered error or discrepancy, the parties shall true-up the data and adjust currently for the priorunderpayment or overpayment. Any true-up shall be only with respect to correction of any data relied upon at the time of the calculationand payment of the Fee for any month.

 

8. BOOKS AND RECORDS. Scrips, at its sole expense, shallmaintain separate and complete books and records, on the appropriate accrual basis, in accordance with sound and generally acceptedaccounting principles (which, having been adopted, shall not be changed without unanimous consent of the parties) showing all revenues,sales, receipts, costs, expenses, liabilities, receivables, profits and losses. Implex and Pharmacy shall have full access, duringnormal business hours, to all such books and records and the supporting documentation therefor.

 

9. REPORTS AND TAX REPORTS. (a) Promptly after each fiscalyear, such accountant as Scrips may, from time to time, appoint, shall prepare such financial reports of Pharmacy from the bookswhich it keeps, as would be required for delivery to an auditor for audit purposes and deliver copies thereof to Implex and Pharmacy.Such financial statements shall be at the expense of Scrips.

(b) The accountant appointed by Scrips shall also prepare atax return and constituent schedules for Pharmacy for the fiscal year then ended, for use by Implex in filing a consolidated taxreturn to the IRS. The costs and expenses of such preparation will be borne by Scrips.

 

10. TERMINATION. This Agreement may be terminated byany of the parties as follows:

(a) Upon failure of the other party to curea default under, or a breach of, this agreement within thirty (30) days after written notice is given as to such default or breachby the terminating party;

(b) Upon the bankruptcy or liquidation ofthe terminated party; whether voluntary or involuntary;

(c) Upon the terminated party taking thebenefit of any insolvency law; and/or

(d) Upon the termionated party having, orapplying to have, a receiver appointed for all or a substantial part of such party's assets or business.

 

 

**MISCELLANEOUS**

 

10. Should a party default in the terms or conditions of thisAgreement and suit be filed as a result of such default, the prevailing party shall be entitled to recover all costs incurred asa result of such default including all costs and reasonable attorney fees, expenses and court costs through trial and appeal.

 

11. The failure of either party to object to, or to take affirmativeaction with respect to, any conduct of another party which is in violation of the terms of this Agreement shall not be construedas a waiver of such violation or breach, or of any future breach, violation, or wrongful conduct. No delay or failure by any partyto exercise any right under this Agreement, and no partial or single exercise of that right, shall constitute a waiver of thator any other right, unless otherwise expressly provided herein.

 

12. The rights and obligations of the parties under this Agreementshall inure to the benefit of, and shall be binding upon, the successors and assigns of the parties. This Agreement may not beassigned by any party or by operation of law or otherwise, except by the express prior written consent of the other parties.

 

13. All notices or other communications to be sent as providedfor in this Agreement shall be in writing and shall be sent by certified mail, postage prepaid, to the persons and addresses hereindesignated or such other persons and/or addresses as may hereafter be designated in writing by the parties:

 

If to Pharmacy:

 

If to Scrips:

 

If to Implex:

 

A copy of any notice may be sent by e-mail or fax, but shallnot be deemed served until three (3) days after the date of mailing.

 

14. This instrument contains the entire agreement of the partiesand all prior negotiations, memoranda, understandings and interim agreements have been merged herein. It may be modified only byan amendment in writing, signed by the party against whom enforcement of any waiver, change, modification, extension or dischargeis sought. No representations were made or relied upon by any party other than those expressly set forth in this Agreement.

 

 

15. If any provision of this Agreement is declared void, suchprovision shall be deemed severed from this Agreement, which shall otherwise remain in full force and effect.

 

16. This Agreement shall be a contract made in the State ofNew Jersey and shall be interpreted and governed by, and construed in accordance with, the laws of the State of New Jersey.

 

17. Any and all taxes, excises, assessments, levies, interestand penalties, which may be assessed, levied, demanded, or imposed by any governmental agency in connection with this Agreement,shall be paid by the party upon which they are imposed and shall be the sole obligation of such party.

 

18. This Agreement may be executed in two or more counterparts,each of which shall be deemed an original but all of which together shall constitute one and the same instrument.

 

**IN WITNESS WHEREOF,** the parties hereto,intending to be legally bound, have executed this Agreement.

 

**MAIN AVENUE PHARMACY, INC.**.

 

 

By:  /s/ Dmitriy Naydenko 

        Dmitriy Naydenko, Pres

 

**SCRIPSAMERICA, INC.**

 

 

By:  /s/ Robert Schneiderman 

        Robert Schneiderman, Pres

 

**IMPLEX CORPORATION**

 

 

By:  /s/ Richard C. Fox 

        Richard C. Fox, Pres