EXHIBIT 10.8
ADMINISTRATIVE SERVICES AGREEMENT
THIS ADMINISTRATIVE SERVICES AGREEMENT (this "Agreement") made as of the
1ST day of August, 2003 (the "Effective Date") by and between BIOCHEMICS, INC.,
a corporation organized under the laws of the State of Delaware, United States
of America ("BioChemics"), and VASO ACTIVE PHARMACEUTICALS, INC., a corporation
organized under the laws of the State of Delaware, United States of America
("VAP", together with BioChemics, the "Parties" and each individually a
"Party").
WHEREAS BioChemics owns a 100 percent interest in VAP but otherwise deals
with VAP with respect to all matters on an arm's length basis;
AND WHEREAS the administrative resources that BioChemics uses in its
business are similar to those that are required by VAP for its business and
BioChemics is willing to provide such administrative resources to VAP in
accordance with the terms and conditions of this Agreement;
AND WHEREAS the Parties wish to establish the principles which shall
henceforth govern the provision by BioChemics to VAP of the services referred to
herein at a fair market value for the duration of the term of this Agreement.
NOW, THEREFORE, THIS AGREEMENT WITNESSETH THAT, in consideration of the
mutual covenants contained herein, it is agreed by and between the Parties as
follows:
ARTICLE I
INTERPRETATION
1.1 Definitions. For the purposes of this Agreement or any notice, consent,
request, authorization, permission, direction or other communication required or
permitted to be given hereunder, the following words and phrases shall have the
following meanings, respectively, unless the context otherwise requires:
(a) "Administrative Services" shall have the meaning ascribed thereto at
Subsection 2.2.
(b) "Indemnified Party" shall have the meaning ascribed thereto at
Section 6.1.
(c) "Indemnifying Party" shall have the meaning ascribed thereto at
Section 6.1.
(d) "Person" means any individual, sole proprietorship, trust, estate,
executor, legal representative, unincorporated association, association,
institution, corporation, company, partnership, limited liability company,
limited liability partnership, joint venture, government (whether national,
Federal, state, county, city, municipal or otherwise, including, without
limitation, any instrumentality division, agency, body or department thereof) or
other entity.
(e) "subsidiary" of a Person means any other Person directly, or indirectly
through one or more intermediaries, controlling, controlled by or under common
control with the first Person. As used in this definition of the term
"subsidiary", and elsewhere herein with respect to any affiliate of any Person,
"control" (including the terms "controlled by" and "under common control with")
means the possession, directly or indirectly, of the power to direct or cause
the direction of the management policies of a Person, whether through the
ownership of voting securities, by voting trust, contract or similar
arrangement, as trustee or executor, or otherwise.
(f) "Services Fee" shall have the meaning ascribed thereto at Section 4.1.
1.2 Gender. Any reference in this Agreement to any gender shall include both
genders and the neuter and words used herein imparting the singular number only
shall include the plural and vice-versa.
1.3 Headings. The division of this Agreement into Articles, Sections,
Subsections and other subdivisions and the insertion of headings are for
convenience of reference only and shall not affect or be utilized in the
construction or interpretation hereof.
ARTICLE II
ADMINISTRATIVE SERVICES
2.1 Administrative Services. During the term of this Agreement, BioChemics,
whether directly or indirectly, shall provide to VAP, either through BioChemics
personnel or through qualified personnel hired by BioChemics, all Administrative
Services
reasonably required or requested by VAP which are of a type normally used by
BioChemics in respect of its own business and in a manner and at a level of
service consistent with the same services utilized by BioChemics, in order to
support, advise and assist in the operations and business affairs of VAP as they
may evolve from time to time over the term of this Agreement.
2.2 Description of Administrative Services. Upon and subject to the terms of
Section 2.1, BioChemics shall provide to VAP, at VAP's reasonable request,
administrative support services including, but not limited to (i) secretarial
support services, (ii) accounting and tax services; (iii) data processing
services; (iv) the provision of utilities; (v) the provision and maintenance of
designated office space; (vi) the provision of designated warehouse and storage
space; (vii) the provision of office supplies; (viii) telephone and computer
services and equipment; and (ix) such other office and corporate support
services as may be reasonably required by VAP from time to time (each an
"Administrative Service" and collectively, the "Administrative Services").
ARTICLE III
PROVISION OF SERVICES
3.1 Representations, Warranties and Covenants of BioChemics. BioChemics
represents, warrants and covenants to and in favor of VAP that it shall use the
same degree of care and skill in the provision of the Administrative Services to
VAP as BioChemics uses in providing similar services to itself. Except as
aforesaid, BioChemics makes no other representation, warranty or covenant,
express or implied, statutory or otherwise, as to the quality, scope or
availability of any of the Administrative Services.
ARTICLE IV
FEES
4.1 Services Fee. As consideration for BioChemics performing and providing the
Administrative Services in accordance with this Agreement, VAP shall pay to
BioChemics a fee equal to BioChemics' fully loaded costs (i.e. including
incidental costs) of the Administrative Services provided by BioChemics during a
given period, plus a 10% administration fee (the "Services Fee"). Where
applicable, the fee associated with a particular Administrative Service shall be
calculated on a pro-rated basis, based on the actual portion of such service
used by VAP during a given period. The Services Fee shall be paid in full within
thirty (30) days of receipt of an invoice from BioChemics. Both Parties agree
and acknowledge that the Monthly Fee is a fair and reasonable fee for the
provision of the Administrative Services by BioChemics under this Agreement.
ARTICLE V
TERM AND TERMINATION
5.1 Term. This Agreement shall become effective on the Effective Date and,
except as otherwise provided herein, shall be in effect for an initial term of
five (5) years (the "Initial Term") and shall be automatically renewed on each
anniversary date hereof for an additional period of twelve (12) months so long
as this Agreement has not been terminated as permitted herein.
5.2. Termination by BioChemics. BioChemics may terminate this Agreement for a
material breach by VAP (including, but not limited to non-payment of Monthly
Fees) by giving VAP written notice specifying the breach relied on and giving
VAP three (3) months to cure such breach. If the default has not been cured at
the end of such three (3) month cure period, then, upon written notice thereof
to VAP by BioChemics, this Agreement shall terminate. Termination for breach
will have no effect on performance obligations or amounts to be paid which have
accrued up to the effective date of such termination.
5.3 Termination by VAP. VAP may terminate this Agreement at any time by
providing thirty (30) days written notice of such termination to BioChemics.
[5.4 Notwithstanding any other provision of this Agreement, in the event
BioChemics ceases to own beneficially, directly or indirectly, such number of
the issued and outstanding shares of the capital stock of VAP to which are
attached at least forty-nine percent (49%) of the votes that may be cast to
elect directors of VAP, then either VAP or BioChemics may terminate the
respective rights and obligations of VAP and BioChemics under this Agreement by
providing no less than forty-five (45) days prior written notice to the other,
as the case may be.]
5.5 Notwithstanding any other provision of this Agreement, in the event that
VAP shall have disposed of all or substantially all of its assets, then either
VAP or BioChemics may immediately terminate the respective rights and
obligations of VAP and BioChemics under this Agreement by providing to the other
written notice to that effect.
5.6 Obligations Upon Termination. As soon as reasonably practicable following
the date of the termination of this Agreement for any reason, BioChemics shall:
(a) Segregate and deliver to VAP all books and records, or copies thereof,
pertaining exclusively to VAP used in the course of, or generated by, the
provision of the Administrative Services and, after a reasonable period of time
sufficient to remove information which does not pertain to the business of VAP,
all books and records, or copies thereof, pertaining to VAP used in the course
of, or generated by, the provision of the Administrative Services; and
(b) For a period of ninety (90) days after the termination of this
Agreement, provide to and at the option of VAP such Administrative Services as
may be reasonably requested by VAP in order to help ensure the continuity of the
business of VAP. BioChemics shall be entitled to the payment of fees for any
transitional services rendered under this Section 5.6. Such fees shall be
calculated and payable in the same manner as the Monthly Fees.
ARTICLE VI
REMEDIES
6.1 Indemnification. Each Party (the "Indemnifying Party") shall indemnify and
save harmless the other Party and their directors, officers and employees
(individually, an "Indemnified Party") from and against any claims, demands,
actions, causes of action, judgments, damages (excluding indirect or
consequential damages), losses (which shall include any diminution in value),
liabilities, costs or expenses (including, without limitation, interest,
penalties and reasonable attorneys' and experts' fees and disbursements) which
may be made against any Indemnified Party or which any Indemnified Party may
suffer or incur as a result of, arising out of, or relating to, any breach of
this Agreement by the Indemnifying Party.
6.2 Survival of Indemnification. Each Party's obligations of indemnification
under this Agreement shall survive the termination of this Agreement or any
termination of any Party's respective rights and obligations under Article II
hereof.
6.3 Default Interest. If any Party fails to pay as and when due and payable any
amount hereunder (including, without limitation, the Monthly Fees), then such
Party shall pay interest to the other Party on such amount from the due date up
to and including the date when such amount and all interest thereon are paid in
full at the rate of two percent (2%) per annum.
6.4 Waiver of Consequential Damages. Each Party hereby waives any right to
recover consequential, punitive, exemplary or similar damages in any
arbitration, lawsuit, litigation or proceeding arising out or resulting from
this Agreement. Each Party certifies and acknowledges that (a) no
representative, agent or attorney of any other Party has represented, expressly
or otherwise, that such other Party would not, in the event of arbitration,
litigation or other proceeding, seek to enforce the foregoing waiver, (b) it
understands and has considered the implications of this waiver, (c) it makes
this waiver voluntarily, and (d) it has been induced to enter into this
Agreement by, among other things, the mutual waivers and certifications in this
Section 6.4.
ARTICLE VII
MISCELLAENOUS
7.1 Utilization of Others. For the avoidance of doubt the Parties hereby
expressly agree that in providing the Administrative Services hereunder
BioChemics may utilize the advice and assistance of such other firms or persons,
including its subsidiary or affiliated companies, as it may reasonably determine
necessary or appropriate and the costs and expenses of such services shall,
without duplication, be recoverable from VAP in accordance with the provisions
of this Agreement. It is further agreed that VAP is not required to obtain any
of the Administrative Services or any other or similar services exclusively from
BioChemics and may utilize the advice and assistance of such other firms or
persons, including any subsidiaries or affiliated companies, as it may
reasonably determine necessary or appropriate in order to operate its business.
7.2 Research and Development. For the avoidance of doubt, the Parties
acknowledge and agree that the Administrative Services contemplated hereunder do
not, and shall not be construed so as to, include any transfer, license or grant
of rights from BioChemics to VAP in respect of any intellectual property rights
(including, without limitation, all domestic and foreign patents, trademarks,
copyrights, trade secrets, inventions and know-how) owned, used, developed,
leased or licensed by BioChemics or any research and development undertaken by
BioChemics (together "Intellectual Property Rights"), PROVIDED ALWAYS that any
such Intellectual Property Rights transferred to VAP from BioChemics pursuant to
any other agreement shall remain in full force and effect and shall not be
affected in any manner by the operation of this Agreement.
7.3 Assignment by BioChemics. Except as provided in this Section 7.3, this
Agreement may not be assigned by BioChemics in whole or in part. Notwithstanding
the foregoing, at any time during the term hereof, BioChemics may assign this
Agreement, upon prior written notice to VAP, to any Person that is and at all
times remains a subsidiary of BioChemics, or that merges or consolidates with or
into BioChemics or any of its subsidiaries, or that acquires all or
substantially all of the assets of BioChemics or of any of its subsidiaries.
BioChemics shall cause any Person that merges or consolidates with or into
BioChemics or any of its subsidiaries (in the event BioChemics is not the
surviving corporation in any such merger or consolidation), or that acquires all
or substantially all of the assets of BioChemics, to assume all liabilities and
obligation of BioChemics under this Agreement pursuant to
an instrument in form and substance reasonably satisfactory to VAP. Any
purported assignment or transfer of this Agreement in violation of this Section
7.3 shall be void and of no force or effect.
7.4 Assignment by VAP. Except as provided in this Section 7.4, this Agreement
may not be assigned by VAP in whole or in part. Notwithstanding the foregoing,
at any time during the Term, VAP may assign this Agreement (a) to any lender or
lenders as security for obligations to such lender or lenders in respect of
financing arrangements of VAP or any affiliate thereof with such lender or
lenders, or (b) upon prior written notice to BioChemics, to any Person that is
and at all times remains a subsidiary of VAP controlled by VAP, or that merges
or consolidates with or into VAP, or that acquires all or substantially all of
the assets of VAP. VAP shall cause any Person that merges or consolidates with
or into VAP (in the event VAP is not the surviving corporation in any such
merger or consolidation), or that acquires all or substantially all of the
assets of VAP, to assume all liabilities and obligation of VAP under this
Agreement pursuant to an instrument in form and substance reasonably
satisfactory to BioChemics. Any purported assignment or transfer of this
Agreement in violation of this Section 7.4 shall be void and of no force or
effect.
7.5 Notices. All notices, requests, demands and other communications hereunder
shall be in writing or by electronic means producing a written record (facsimile
machine, telex, telecopier or telegraph), personally-delivered or sent by
nationally-recognized overnight courier service, effective upon delivery, or two
(2) days after sending if by overnight courier, addressed as follows:
If to VAP:
Vaso Active Pharmaceuticals, Inc.
00 Xxxxxxxx Xxxxx, Xxxxx 000
Xxxxxxx, XX 00000
Attn.: Xxxx X. Masiz, President
Telephone Number: 000.000.0000
Facsimile Number: 978.750.0085
with a copy to:
Xxxxxxxx & Xxxx LLP
Xxx Xxxxxx Xxxxx
Xxxxxx, XX 00000
Attn.: Xxxxx X. Xxxxxx, Esq.
Telephone Number: (000) 000-0000
Facsimile Number: (000) 000-0000
If to BioChemics:
BioChemics, Inc.
00 Xxxxxxxx Xxxxx, Xxxxx 000
Xxxxxxx, XX 00000
Attn.: Xxxx X. Masiz, President
Telephone Number: 000.000.0000
Facsimile Number: 978.750.0085
Either Party may change its address or the addressee specified for notices by
designating a new address or addressee by notice in accordance with this Section
7.5.
7.6 Amendment; Waiver. No amendment, modification or discharge of this
Agreement, and no waiver hereunder, shall be valid or binding unless set forth
in writing and duly executed by the Party against whom enforcement of the
amendment, modification, discharge or waiver is sought. Any such waiver shall
constitute a waiver only with respect to the specific matter described in such
writing and shall in no way impair the rights of the party granting such waiver
in any other respect or at any other time. The failure of either Party to insist
in any one or more instances upon strict performance of any of the provisions of
this Agreement or take advantage of any of its rights hereunder shall not be
construed as a waiver of any such provisions or the relinquishment of any such
rights, but the same shall continue and remain in full force and effect.
7.7 Entire Agreement. This instrument constitutes the entire agreement between
the Parties relating to the subject matter hereof and there are no agreements,
understandings, conditions, representations or warranties not expressly set
forth herein.
7.8 Governing Law. All questions concerning the construction, validity, and
interpretation of this Agreement and the performance of the obligations imposed
by this Agreement shall be governed by the internal law, but not the law of
conflicts, of the State of Delaware, United States of America.
7.9 Severability. Any term or provision of this Agreement that is invalid or
unenforceable in any jurisdiction shall, as to that jurisdiction, be ineffective
to the extent of such invalidity or unenforceability, without rendering invalid
or unenforceable the remaining terms and provisions of this Agreement or
affecting the validity or unenforceability of any of the terms or provisions of
this Agreement in any other jurisdiction. If any term or provision of this
Agreement is so broad as to be invalid or unenforceable, the provision shall be
interpreted to be only as broad as is valid or enforceable. Subject to the
foregoing provisions of this Section 7.9, if any term or provision of this
Agreement is invalid or unenforceable for any reason, such circumstances shall
not have the effect of rendering such term or provision invalid or unenforceable
in any other case or circumstance.
7.10 Counterparts. This Agreement may be signed by the Parties executed in one
or more counterparts as may be deemed necessary, each of which so signed shall
be deemed to be an original, and all such counterparts together shall constitute
one and the same instrument. Delivery of an executed signature page to this
Agreement by facsimile transmission shall be as effective as delivery of a
manually signed counterpart of this Agreement.
[THE NEXT PAGE IS THE SIGNATURE PAGE]
IN WITNESS WHEREOF, the Parties have executed this Agreement on the date and at
the place first above-mentioned.
For: VASO ACTIVE PHARMACEUTICALS, INC.
Name: Xxxx X. Masiz
Title: President
Signature: /s/ Xxxx X. Masiz
-----------------
Date: 8/26/2004
For: BIOCHEMICS, INC.
Name: Xxxx X. Masiz
Title: President
Signature: /s/ Xxxx X. Masiz
-----------------
Date: 8/26/2004
