Exhibit 10.20
SFBC New Drug Services, Inc.
0000 Xxxxxxxx Xxxxxxxxx
Xxxxx, Xxxxxxx 00000
March 13, 2004
Drug Research Services, Inc.
000 XxXxxxxx Xxxx, Xxxxx 000
Xxxxxxx Xxxxxx, XX 00000
Attention: Xx. Xxxxxxx Xxxxx, President
RE: ASSET PURCHASE AGREEMENT
Dear Xx. Xxxxx:
SFBC New Drug Services, Inc., a Florida corporation (the "Company"), in
connection with our discussions regarding the Earn-Out, has agreed to offer Drug
Research Services, Inc., formerly known as New Drug Services, Inc. ("NDS"), a
Delaware corporation, the following terms and conditions in connection with the
modification of certain payments under the Earn-Out contained in the Asset
Purchase Agreement dated September 6, 2002, by and among the Company, SFBC
International, Inc. ("SFBC"), and New Drug Services, Inc. ("Asset Purchase
Agreement"). These terms provide for guaranteed advance payments in exchange for
a reduction in the total amount of the Earn-Out due to NDS if, as and when
earned. If these terms and conditions reflect our discussions and are acceptable
to NDS, please execute a copy of this letter agreement ("Amendment"), and return
it to the Company at the above address. Capitalized terms herein shall have the
same meaning ascribed to them as in the Asset Purchase Agreement.
The Company shall make an advance payment of the Level 1 Earn-Out
referenced in Section 4.03 (a) of the Asset Purchase Agreement in the amount of
$400,000 no later than March 31, 2004.
The Company shall make an advance payment of the Level 2 Earn-Out
referenced in Section 4.03 (b) of the Asset Purchase Agreement in the amount of
$150,000 no later than March 31, 2004.
In consideration for these payments, the Earn-Out and any payments
thereunder shall be reduced by 12.1875%. The maximum cumulative amount payable
for Level 1 Earn-Out shall be reduced to $3,512,500 and the amount otherwise
payable by the Company for Level 2 Earn-Out shall be reduced to a maximum of
$2,919,766 making the maximum total Earn-Out payable under the Asset Purchase
Agreement $6,432,266. The final two installments of the advance payments of
Level 2 Earn-Out Referenced in Section 4.03 (b) of the Asset Purchase Agreement
shall be reduced by $75,000 each, and the reduced amount shall be paid when due.
Except as otherwise provided herein, the Asset Purchase Agreement is
not otherwise amended, and is hereby confirmed and ratified in all respect by
the Company, NDS, and SFBC. All payments made to NDS under the Agreement and
this Amendment shall be made subject to
Drug Research Services, Inc.
March 13, 2004
Page 2
applicable withholding requirements as may be required by law. NDS agrees to
indemnify the Company and hold the Company harmless from any and all taxes,
penalties, and other assessments that the Company is, or may become, obligated
to pay on account of any payments made to NDS under the Agreement and this
Amendment.
This Amendment sets forth the entire agreement between the Company and
NDS and supersedes any and all prior and contemporaneous oral and written
agreements and understandings between the Company and NDS concerning its subject
matter. This Amendment shall be governed by and construed in accordance with the
laws of the State of Florida, without regard to conflict of laws principles.
This Amendment may be executed in separate counterparts and by
facsimile, and each such counterpart shall be deemed an original, and together
one agreement.
Sincerely,
/s/ Xx. Xxxxxxx X. Xxxxx
-------------------------
Xx. Xxxxxxx X. Xxxxx
Chief Executive Officer
SFBC International, Inc.
By: /s/ Xxxxxx Xxxxxxx
----------------------------
Xxxxxx Xxxxxxx
Chief Executive Officer
ACCEPTED AND AGREED TO, This ___ day of March, 2004.
Drug Research Services, Inc.
/s/ Xx. Xxxxxxx Xxxxx
--------------------------------
Xx. Xxxxxxx Xxxxx, President
/s/ Xx. Xxxxxxx Xxxxx
--------------------------------
Xx. Xxxxxxx Xxxxx
