Document:

Exhibit 10.1

 

COLOCATION
CENTER TERMINATION AGREEMENT

THIS COLOCATION
CENTER TERMINATION AGREEMENT (this “Termination Agreement”) is made and entered
into as of the 29th day of December, 2006, by and between OMTek,
LLC, a Utah limited liability company, (“Lessor”) and Overstock.com, Inc., a
Delaware corporation, (“Lessee”).

R E C I T A L S:

A.  Lessor and Lessee entered into a Colocation
Center Agreement dated July 1, 2005 (the “Colocation Agreement”) with respect
to certain premises on the first floor of the building known as Old Mill
Corporate Center II (the “Building”) consisting of 11,289 rentable square feet
and 9,567 useable square feet (the “Premises”).

B.  Lessee desires to terminate the Colocation
Agreement, and Lessor is willing to terminate the Colocation Agreement on the
terms and conditions set forth hereinafter.

NOW, THEREFORE, in
consideration of their mutual promises and covenants set forth hereinafter, the
parties agree as follows:

1.  Termination of Colocation Agreement.  Lessor and Lessee hereby agree that the
Colocation Agreement shall be terminated effective as of the date hereof,
subject to the terms and conditions of this Termination Agreement.

2.  Termination Payment.  As consideration for
termination of the Colocation Agreement, Lessee shall pay to Lessor the sum of
Five Million Four Hundred Ninety-Nine Thousand Four Hundred Six and 88/100s
Dollars ($5,499,406.88) (the “Termination Amount”) on or before February 1, 2007.

Any amount not
paid when due or within five (5) days thereafter shall be subject to a late
charge in the amount of five percent (5%) of the delinquent amount.  Further, any payment not paid when due shall
bear interest at the rate of twelve percent (12%) per annum from the date five
(5) days after the due date.  Any late
charge shall bear interest at the rate of twelve percent (12%) per annum from
the date five (5) days after the due date.

3.  Failure to Pay Termination Amount.  Notwithstanding any other
provision herein, in the event Lessee fails to pay the entire Termination
Amount, this Termination Agreement shall be null and void; and any amounts paid
by Lessee shall be credited against rent owed under the Colocation Agreement.

4.  Termination of Possession.  Lessee shall terminate its possession of the
Premises on or before April 30, 2007.  In
the event Lessee is unable to terminate its possession of the Premises on or
before April 30, 2007, Lessee shall give Lessor not less than fifteen (15) days
written notice in which Lessee specifies the date by which it will terminate
its possession of the Premises; and in such event Lessee shall be entitled to
occupy the Premises through the date 

 

specified in the
notice.  During any period of time that
Lessee occupies the Premises after April 30, 2007, Lessee shall reimburse Lessor
for the actual costs incurred by Lessor as a result of Lessee’s continued
possession of the Premises.  Such
reimbursement shall be due and payable within ten (10) days after Lessor gives
Lessee written notice of the amount of such costs.  Until Lessee terminates its possession of the
Premises, all terms and conditions of the Colocation Agreement other than the
provisions of Sections 1.2 (Term) and 3.1 (Rent) shall apply.  Lessee shall surrender possession of the Premises
to Lessor in good order and condition in accordance with the provisions of
Section 16.2 of the Colocation Agreement. 
Lessee shall be responsible for any damages to the Premises or the
Building caused by Lessee, its employees, agents or invitees.

5.  Release of Lessee’s Obligations.  Subject to the provisions of this Termination
Agreement, Lessor hereby forever releases, discharges, acquits and forgives
Lessee and its shareholders, directors, officers, employees and agents from any
and all claims, suits, actions, demands, liabilities and proceedings of every
nature and description arising from the beginning of time to the date of these
presents, arising out of under the Colocation Agreement.

6.  Release of Lessor’s Obligations.  Subject to the provisions of this Termination
Agreement, Lessee hereby forever releases, discharges, acquits and forgives
Lessor and its managers, members, officers, employees and agents from any and
all claims, suits, actions, demands, liabilities and proceedings of every
nature and description arising from the beginning of time to the date of these
presents, arising out of under the Colocation Agreement.  Lessee acknowledges that Lessee will not be
entitled to any remaining credits under the Colocation Agreement.

7.  Notices. 
Any notice given to Lessor shall be in writing and
delivered personally to the manager of Lessor or deposited in the United States
mail, postage prepaid, certified, return receipt requested, addressed to Lessor
at 6322 South 3000 East, Suite 120, Salt Lake City, Utah 84121.  Any notice given to Lessee shall be in
writing and delivered personally to an officer of Lessee or deposited in the
United States mail, postage prepaid, certified, return receipt requested,
addressed to Lessee at 6350 South 3000 East, Salt Lake City, Utah 84121.  Any notice given by mail shall be deemed to
have been received four (4) days after its mailing.

8.  Attorneys’ Fees.  If either Lessor or Lessee shall obtain legal
counsel or bring an action against the other by reason of the breach of any
covenant, warranty or condition hereof, or otherwise arising out of this
Termination Agreement, the unsuccessful party shall pay to the prevailing party
reasonable attorneys’ fees, which shall be payable whether or not any action is
prosecuted to judgment.  The term “prevailing
party” shall include, without limitation, a party who obtains legal counsel or
brings an action against the other by reason of the other’s breach or default
and obtains substantially the relief sought, whether by compromise, settlement
or judgment.

9.  Successors and Assigns.  This Termination Agreement and all
provisions, covenants and conditions thereof shall be binding upon and inure to
the benefit of the successors and assigns of the parties hereto.

 2
 

 

IN WITNESS
WHEREOF, the parties hereto have executed this Termination Agreement as of the
day and year first above written.

	
  Lessor:

  	
  Lessee:

  
	
   

  	
   

  
	
  OMTek, LLC

  	
  Overstock.com, Inc.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By: 

  	
  /s/ Richard N. Beckstrand

  	
   

  	
  By: 

  	
  /s/ Jason C. Lindsey

  
	
  Its:

  	
  Manager

  	
   

  	
  Its: 

  	
  President & COO

  

 

 

 3Exhibit 10.1

AGREEMENT FOR LOGISTICS
SERVICES

This
Agreement for Logistics Services (this “Agreement”),
executed as of this 1st day of December, 2006, is made by and between MWI
Veterinary Supply Co., located at 651 S. Stratford Drive, Suite 100, Meridian,
ID 83642 (“MWI”), and Medical Management
International, Inc., dba Banfield, The Pet Hospital, located at 8000 NE
Tillamook Street, Portland, OR 97213 (“Banfield”).  The parties agree to the following:

1.                                       Logistics
Fees.  Banfield and
MWI have agreed upon the following logistics fees to be paid by Banfield for
services performed by MWI in accordance with this Agreement (the “Logistics Fees” and each, a “Logistics
Fee”).  The respective
Logistics Fees will be payable in the circumstances described for each fee
below.  The amount of each Logistics Fee
as stated below is per **.  No more than
one Logistics Fee will be payable on any **.

	
  Order Type

  	
   

  	
  Logistics

  Fee

  	
   

  	
  Functions Performed by MWI

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  MWI Inventory

  	
   

  	
  $**

  	
   

  	
  Order
  processing; warehouse;

  
	
  (order fulfilled from
  MWI-owned general inventory at MWI warehouse)

  	
   

  	
   

  	
   

  	
  collection

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Toll Warehouse

  	
   

  	
  $**

  	
   

  	
  Order
  processing; warehouse;

  
	
  (order fulfilled from
  MWI-owned inventory stocked exclusively for Banfield at MWI warehouse)

  	
   

  	
   

  	
   

  	
  collection

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Consignment (**)

  	
   

  	
  $**

  	
   

  	
  Order
  processing; warehouse

  
	
  (order fulfilled from
  inventory owned by Banfield or a third party, and held by MWI at an MWI
  warehouse)

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Drop Shipments

  	
   

  	
  $**

  	
   

  	
  Order
  processing; collection

  
	
  (order fulfilled by direct
  shipment from manufacturer or supplier to Banfield, with payment to MWI)

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Pass-Through

  	
   

  	
  $**

  	
   

  	
  Order processing

  
	
  (order fulfilled directly by
  manufacturer or supplier who bills and collects directly from Banfield)

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Credits

  	
   

  	
  $**

  	
   

  	
  Order
  processing; warehouse;

  
	
  (applies when Banfield
  returns products for reasons other than MWI mis-shipment)

  	
   

  	
   

  	
   

  	
  collection

  

 

The
Logistics Fees will be invoiced and paid in accordance with Section 3
below.  The Logistics Fees will not be
subject to adjustment without the mutual written agreement of Banfield and
MWI.  The above Logistic Fee pricing
assumes that MWI will provide the applicable logistics functions, as set forth
in the above schedule, for all existing Banfield practice-owned hospitals and
any new practice-owned hospitals that will be opened during the term of this
Agreement.  Such pricing also assumes
that Banfield will make reasonable efforts to have Charter Practices utilize
MWI for all such functions.  Orders by
Banfield practice-owned and Charter Practice hospitals will be entered via
BanfieldDirect.com, Oracle I Procurement, or some other electronic

means.  For purposes of this Agreement, “practice-owned”
means those hospitals owned and operated directly by MMI or owned and operated
by A Caring Doctor, P.C.; A Caring Doctor (Minnesota), P.A.; A Caring Doctor
(New Jersey), P.C.; A Caring Doctor (North Carolina), P.C.; or A Caring Doctor
(Texas), P.C.

2.                                       Opening
Order Fees and Hospital Reset Fees.  There will be a $** fee for the special
service requirements related to the initial order for the opening of a
full-service hospital, and a $**fee for an order for a hospital reset or
refurbishment with no additional Logistics Fees (other than those stated in
this agreement) in either case.  However,
when Banfield team members enter orders into BanfieldDirect.com or Oracle I
Procurement and the orders do not require special staging in an MWI warehouse,
then these special fees shall not apply to opening orders, resets and
refurbishments and the regular Logistics Fees will apply.

3.                                       Payment
Terms.  MWI will
extend payment terms to Banfield of ** days from invoice date.  When using the consolidated invoice download,
the invoice date will be considered to be the date of the consolidated invoice weekly report.  Banfield may prepay for purchases by issuing
a payment to MWI for approximately ** days of Banfield’s estimated
purchases.  **.  **. 
Banfield and MWI will review and true up Banfield’s account once each
month by an additional payment from Banfield if the prepayment was less than
the actual invoice total and by a refund to Banfield if the prepayment exceeded
the actual invoice total.  Banfield
agrees to make all payments via electronic funds transfer.

4.                                       On-Site
Training.  MWI will, at no cost to Banfield, provide
ongoing training at the direction of Banfield’s Senior Director of Purchasing
to Banfield team members regarding systems and procedures for hospital ordering
and inventory management.

5.                                       Ordering.  MWI, to Banfield’s specifications, has
developed and will continue to maintain, at MWI’s expense, the Internet based
order entry system BanfieldDirect.com. 
Banfield may use this system or Oracle I-procurement as its primary
method of entering ** supply orders for its hospitals.  ** orders will be placed, at the direction of
Banfield’s Purchasing team, ** each week for processing ** and shipment **,
except in cases of holidays, when shipments can be ** of the week.

6.                                       Shipping
Errors.  In the event that MWI makes a shipping error,
i.e., shipping a product not ordered or shipping a quantity of product not as
ordered, MWI will not charge Banfield for the logistics fee and applicable
freight related to the incorrect shipment. 
When a call is received from a hospital and it is determined that there
has been a shipping error, MWI’s Banfield support team will re-enter an order
to ship the correct product, and at that time will issue a credit to the
hospital for the logistics fee and freight relating to the incorrect shipment,
and will also issue a credit for the logistics fee and freight that will be
assessed when the incorrect product is returned.

7.                                       Supply.  MWI realizes that Banfield relies upon MWI as
Banfield’s sole-source distributor for most products and will therefore program
its inventory system to stock the highest service level available for all
products on the Banfield formulary. 
Unless MWI and Banfield otherwise agree in writing, the “highest service
level available” means, for each product listed in Exhibit A attached hereto
(as such exhibit may be amended from time to time by mutual written agreement
of MWI and Banfield) at each of MWI’s regional warehouses, a **-day supply
based on Banfield’s estimated rolling average requirements for such product in
such region over the coming ** months. 
Banfield will be provided prompt notification whenever any product
listed in Exhibit A falls below a ** day supply at any warehouse and
such deficiency is not cured within ** calendar days.  In addition MWI will stock a **-day supply of
all ** products at all times, barring delivery problems from **.  Banfield branded items and other inventory
items unique to Banfield will be segregated and maintained in a special
Banfield “virtual warehouse” at each of MWI’s regional facilities where
justified by usage and economics and be made available only to Banfield.

 2
 

8.                                       Charter
Hospitals.  MWI will offer its services and products to
each Banfield Charter Practice hospital on the terms described in this
Agreement and the Agreement for Product Purchases.  Banfield will use all reasonable efforts to
encourage Charter hospitals to (1) order all of their products through MWI and
(2) maintain confidentiality regarding terms on which MWI’s services are
provided.  MWI will use all reasonable
efforts to encourage Charter hospitals to utilize the BanfieldDirect.com ordering
system or Oracle I–procurement rather than the MWIVET.com ordering system.  MWI will provide to Banfield each month a
report listing products purchased from MWI by Charter Hospitals that were
purchased outside the Banfield purchasing system.

9.                                       Internet
Reliability Report.  MWI will provide to Banfield, each month, an
Internet reliability report showing total up-time and down-time as percentages
on the days Banfield places orders (**), and listing of any problems that have
occurred during the month which may have resulted in customer inconvenience.

10.                                 Term.  This Agreement shall be effective for an
initial term of December 1, 2006 through November 30, 2009 (the “Initial Term”).  During the final 90 days of the Initial Term,
MWI and Banfield will analyze the fiscal results of the prior three years and
agree upon any revisions to the Logistics Fee pricing or other aspects of this
Agreement (the “Review Period”).  During
this time Banfield and MWI will discuss and assess options to reduce costs to
Banfield.  If the parties reach agreement
in writing upon any adjustments to pricing or other provision of this Agreement
during the Review Period, then the term of this Agreement will continue for an
additional 12 months from the end of the Initial Term.  If, before or during the first 30 days of the
Review Period either party communicates a concern or required revision in
writing and a resolution is not achieved to the mutual satisfaction of both
parties during the Review Period, this Agreement shall terminate at the end of
the Initial Term.  If no such
communications are set forth in writing before or during the first 30 days of
the Review Period, this Agreement will automatically renew for an additional 12
months from the end of the Initial Term. 
This process will continue year after year, unless MWI and Banfield
cannot reach agreement during any Review Period.

11.                                 Termination.  Notwithstanding anything in Section 10
hereof, either party may terminate this Agreement at any time, whether during
or after the Initial Term, with or without cause, provided that Banfield will
give MWI at least one hundred fifty (150) days prior written notice if Banfield
elects to terminate and MWI will give Banfield at least one hundred fifty (150)
days prior written notice if MWI elects to terminate.  Upon termination of this Agreement, any and
all rights and obligations of the parties under this Agreement will terminate,
provided that all rights, obligations or liabilities accrued hereunder prior to
termination, and all rights or obligations which by their nature or express
duration extend beyond the termination of this Agreement, will survive
termination and continue in effect indefinitely or for that express duration.

12.                                 Confidential
Information.  Except for any disclosure required by law,
each party agrees to retain all confidential information received from the
other party in confidence, not to disclose any such information to any other
person, and not to use any such information for its own benefit, to the other
party’s detriment or for any purpose other than in furtherance of this
Agreement.  All information which either
party and any of its agents receives at any time from the other party or any of
its agents shall be deemed confidential and subject to the provisions of this
Section 12, whether the information shall be received orally, in writing,
visually, by inspection of documents, products or processes, by electronic
transmission, or in any other form or manner, excepting only information which
the recipient establishes was generally available to the public at the time of
disclosure or subsequently became generally available to the public other than
as a result, directly or indirectly, of disclosure by the recipient or its
agents.  Information shall be
confidential and shall be subject to this Section 12 whether or not it is
marked or designated “confidential” at the time of disclosure.  Notwithstanding the provisions above, the
recipient may disclose confidential information to its agents only to the
limited extent necessary to carry out this Agreement and maintain the business
relationship.  The recipient shall be
fully

 3
 

responsible for any use or
disclosure of confidential information by any of its agents in violation of
this Section 12.

13.                                 Force
Majeure.  In the event MWI shall be unable or fail at
any time to supply, or Banfield shall be unable or fail at any time to take and
purchase, any product to be sold and purchased hereunder in consequence of
fire, explosion, accident, earthquake, flood, drought, embargo, war (whether or
not declared), riot, terrorist attack, governmental act, delay or failure of
carriers, Acts of God, or any other contingency or delay or failure or cause
beyond the control of the party affected, excluding economic conditions
affecting either party, MWI shall not be liable to Banfield for failure to
supply the product, nor shall Banfield be liable to MWI for failure to take or
purchase the product, during the period of such disability or failure.

14.                                 Notices.  Any notice or demand given by either party to
the other shall be in writing and shall be sent by courier, certified mail,
postage prepaid, return receipt requested, or fax, addressed as follows:

	
  If to MWI:

  	
   

  	
  651 S. Stratford Drive,

  	
   

  	
  If to Banfield:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  8000 NE Tillamook Street

  
	
   

  	
   

  	
  Suite 100

  	
   

  	
   

  	
   

  	
  Portland, OR 97213

  
	
   

  	
   

  	
  Meridian, ID 83642

  	
   

  	
   

  	
   

  	
  Attn: Senior Director of

  
	
   

  	
   

  	
  Attn: Director, Banfield 

  Accounts

  	
   

  	
   

  	
   

  	
  Purchasing

  Fax: 503-922-6147

  
	
   

  	
   

  	
  Fax: 208-955-8999

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  With a copy to:

  	
   

  	
  651 S. Stratford Drive

  	
   

  	
  With a copy to:

  	
   

  	
  Banfield, The Pet Hospital

  
	
   

  	
   

  	
  Suite 100

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  8000 NE Tillamook Street

  
	
   

  	
   

  	
  Meridian, ID 83642

  	
   

  	
   

  	
   

  	
  Portland, OR 97213

  
	
   

  	
   

  	
  Attn: President

  	
   

  	
   

  	
   

  	
  Attn: Legal Counsel

  
	
   

  	
   

  	
  Fax: 208-955-8999

  	
   

  	
   

  	
   

  	
  Fax: 503-922-6112

  

 

Notice
sent by courier shall be deemed effective upon delivery.  Notice sent by certified mail shall be deemed
effective on the third business day after its deposit in the U.S. mail.  Notice sent by fax shall be deemed effective
upon machine confirmation of receipt. 
Either party may by written notice change its address for purposes of
this Agreement.

15.                                 Entire
Agreement, Modifications and Waiver. 
This Agreement constitutes the entire agreement and understanding of
the parties and supersedes any prior agreements and understandings between the
parties with respect to the specific subject matter hereof.  This Agreement cannot be modified except in
writing signed by both parties.  No
waiver of any term or condition of this Agreement shall be deemed to be a
waiver of any other provision hereof, nor shall such waiver constitute a
continuing waiver, and no waiver shall be binding unless executed in writing by
the party making the waiver.

16.                                 Governing
Law.  This
Agreement shall be governed by, interpreted, construed, and the respective
rights of the parties hereto determined and all claims and disputes, whether in
tort, contract or otherwise, resolved according to the laws of the State of
Oregon notwithstanding any conflict of law principles to the contrary.  Any proceeding initiated by MWI arising out
of or in connection with this Agreement will be determined solely by a state or
federal court in Multnomah County, Oregon, and any proceeding initiated by
Banfield arising out of or in connection with this Agreement will be determined
solely by a state or federal court located in Ada County, Idaho, and the
parties consent to the jurisdiction and venue of those courts.

 4
 

17.                                 Successors
and Assignment.  All of the terms and provisions of this
Agreement will be binding on and inure to the benefit of the parties and their
respective successors and assigns. 
Neither party may assign, delegate or transfer to third parties its
rights or obligations hereunder without the prior written consent of the other
party.

18.                                 Attorney
Fees.  In the event
of any legal proceeding arising out of or in connection with this Agreement or
the services provided for herein, or arising with respect to one of the
parties, including but not limited to arbitrations, bankruptcy and
reorganization proceedings and appeals, the prevailing party will be entitled
to recover from the other party its costs, disbursements and reasonable
attorney fees as determined by the court, arbitrator or other presiding
official.

19.                                 Counterpart
Signatures.  This Agreement may be executed in
counterparts, each of which will be deemed an original but all of which will
constitute one and the same instrument.

In Witness Whereof, the parties have
executed this Agreement as of the date first written above.

	
  MEDICAL MANAGEMENT

  	
  MWI VETERINARY SUPPLY CO.

  
	
  INTERNATIONAL, INC.

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ John Payne

  	
   

  	
   

  	
  By:

  	
  /s/ Jim Cleary

  	
   

  
	
   

  	
  John Payne

  	
   

  	
   

  	
  Jim Cleary

  
	
   

  	
  Sr. Vice
  President

  	
   

  	
   

  	
  President &
  CEO

  
	
   

  	
  Practice
  Development

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ Bob Rusunen

  	
   

  	
   

  	
  By:

  	
  /s/ Jim Ross

  	
   

  
	
   

  	
  Bob Rusunen

  	
   

  	
   

  	
  Jim Ross

  
	
   

  	
  Sr. Director,
  Purchasing

  	
   

  	
   

  	
  Director

  
	
   

  	
   

  	
   

  	
   

  	
  Business
  Development, Banfield

  

 

 5

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00116-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00116-of-00352.parquet"}]]