[EXHIBIT 10.4]
PROFESSIONAL SERVICES AGREEMENT
NATIONAL SALES SOLUTIONS, LLC (NSS)
A MARKETING AND SALES MANAGEMENT CORPORATION
and
MED GEN, INC. (MGI)
This Agreement is made this 21st day of January, 2005 by and
between National Sales Solutions, LLC. (hereinafter referred to as NSS),
a Missouri corporation, with offices at 0000 Xxxxxxxxx Xxxxxx Xx.,
Xxxxxxxx, Xxxxxxxx 00000-0000, and Med Gen, Inc. (hereinafter referred to
as MGI), a Florida corporation, with offices at 0000 Xxxx Xxxxxxxx Xxxx
Xxxx, Xxxxx 000, Xxxx Xxxxx, XX 00000.
1) Appointment. Subject to all terms and conditions of this
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agreement, NSS is granted as an independent contractor, the
right to solicit orders for the purchase of "products", as
hereinafter defined, in the "market", as hereinafter defined.
2) Definitions.
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a) Products. The term "Products" means those products that
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are manufactured and/or distributed by MGI for sale to
retailers in the United States hereto, as such may be
amended from time to time by MGI. MGI shall notify NSS
in writing ninety (90) days before any such amendment
to the product line.
b) Market. The term "Market" means all retail and
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wholesale customers in the United States.
3) Orders.
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a) Prices and Terms. NSS shall solicit orders in the
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Market for the purchase of the Products at the prices,
discounts and specifications set forth by MGI, and on
the standard terms and conditions of sale specified by
MGI. MGI shall notify NSS in writing of the addition,
modification, substitution, deletion or discontinuation
of any Sale Term at least Sixty (60) days prior to the
date on which such change is to be effective.
b) Purchase Orders. All purchase orders from customers
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in the Market for products will be processed by MGI for
shipment, subject to credit approval and other
customary approvals. MGI is responsible, with the
assistance of NSS, for assuring that all purchase
orders meet MGI terms of sale before MGI ships and
invoices the product. A copy of each invoice and/or
a statement reflecting the key information on the
invoices will be sent to NSS by MGI along with monthly
commission checks.
4) Duties of NSS.
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a) Best Efforts. NSS shall use its best efforts, under
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the terms and conditions of sale, to solicit orders for
the purchase of the Products in the Market. NSS shall
inform MGI immediately of any information regarding the
credit worthiness of a customer when NSS becomes aware
of a change in condition.
b) Conduct of Business. NSS shall conduct its business
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in a manner that reflects favorably on the good name,
goodwill and reputation of MGI.
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c) Commissions Payable to NSS. MGI will pay NNS 5% of
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invoiced shipments, or a monthly retainer, whichever is
greater. See below for retainer schedule.
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2005 2006 2007
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January $ 5,000 $ 12,000 $ 12,000
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February $ 5,000 $ 12,000 $ 12,000
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March $ 5,000 $ 12,000 $ 12,000
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April $ 5,000 $ 12,000 $ 12,000
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May $ 9,000 $ 12,000 $ 12,000
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June $ 9,000 $ 12,000 $ 12,000
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July $ 9,000 $ 12,000 $ 12,000
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August $ 11,000 $ 12,000 $ 12,000
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September $ 11,000 $ 12,000 $ 12,000
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October $ 12,000 $ 12,000 $ 12,000
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November $ 12,000 $ 12,000 $ 12,000
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December $ 12,000 $ 12,000 $ 12,000
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Total $105,000 $144,000 $144,000
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d) Regional Brokers. As an integral part of this
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Agreement, on advice of MGI, NSS will suggest regional
brokers to represent and be approved by MGI as
necessary. All regional broker commissions (typically 5
to 7% of wholesale) are the responsibility of MGI. NSS
will only administer payment of such commissions if and
when requested by MGI.
e) Consultative Services. NSS will provide consulting
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services. This may include, but is not limited to,
meetings with MGI management to discuss, review or
create marketing plans, displays, selling materials,
point-of-sale materials, packaging, market development
funds, allowance structures, dating terms, etc. Fees
for these services are covered by the sales commission
or the Consulting Fee as appears in 4c.
f) Expenses. All expenses incurred by NSS will be the
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responsibility of NSS with the exception of the
following:
* Attendance by NSS personnel at "retail" conventions, if
requested by MGI unless NSS is to attend and represent
others at a regularly attended Trade Show. Then MGI's
share will be prorated. Prior approval by MGI is
necessary.
* Printing, binding and shipping broker manuals, sales
presentations, and other approved training materials to
the brokers and clinical sales representatives if
approved by MGI.
* Attendance at professional meetings and conventions, if
requested by MGI.
* Trips to meet with MGI personnel, if agreed to by MGI
management.
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g) Trade Secrets. During the term of this agreement and
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in the course of the discharge of the duties and
obligations of NSS set forth herein, NSS shall have
access to and become acquainted with information
concerning the operations of MGI, including without
limitation, financial, pricing, costs, personnel,
sales, planning, technical and other information that
is owned, developed or used by MGI and regularly used
in the operation of MGI's business this information and
other acquired information constitutes MGI's trade
secrets.
h) Restrictions on Use of Trade Secrets and Records.
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(1) All account files, business files, records,
documents, drawings, specifications, equipment, and
similar items relating to the business of MGI, whether
they are prepared by NSS or come into NSS' possession
in any other way and whether or not they contain or
constitute trade secrets owned by MGI, are and shall
remain the exclusive property of MGI. NSS promises and
agrees that neither it or any of its representatives
shall misconstrue, misappropriate, or disclose any of
the trade secrets described herein, directly or
indirectly, or use them in any way, either during the
term of this or at any time thereafter, except as
required in the course the performance of its duties in
connection with said agreement.
i) Unfair Competition After Termination of Agreement.
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NSS acknowledges and agrees that the sale,
unauthorized use or direct or indirect disclosure of
any of MGI's trade secrets, as described herein, obtained
by NSS during the term of this agreement and any time
thereafter, including information concerning MGI's
current procedures, products and services, the facts and
any future or proposed procedures, products or services,
the facts that those procedures, products or services
are planned, under consideration, or in production, as
well as any descriptions of the features of those
procedures, products or services constitute unfair
competition. NSS promises and agrees not to engage in
any unfair competition with MGI either during the term
of this agreement or at any time thereafter.
5) Manner of Payment of Commissions/Fees. MGI shall pay
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Commissions to NSS on a monthly basis, within thirty (30)
days after the end of the month in which MGI has received
payment for the invoiced sale of the Products. All
commissions will be calculated and paid to NSS based on
invoiced cost (wholesale selling price). There will be no
reductions of commissions for co-op, slotting, or other
marketing expenses, which may be deducted off invoice by the
retainer unless these deductions are made without the written
prior approval of MGI.
6) Relationship of the Parties. NSS is an independent
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contractor and is alone responsible for its acts and the acts
of its employees and agents. Nothing in this Agreement shall
create a relationship between the parties of employer and
employee or a partnership or joint venture or any other legal
association, which would impose liability on one party for
the act or failure to act of the other party or its agents or
employees. Neither party hereto shall have the right, power,
or authority to make representations or warranties, to
assume, create or enlarge any obligation or responsibility,
express or implies, or to contact debts or other obligations,
in the name of or on behalf of the other party hereto. All
"Good Will" resulting from the sale of MGI products into the
market will remain the property of MGI.
7) Terms of Agreement and Termination. Within the first
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six months of this agreement, either party may terminate this
agreement for any reason with a 30-day notice in writing to
the other party. Thereafter, MGI may terminate this agreement
only by providing notice to NSS of such desire to terminate
agreement by giving notice that MGI intends to terminate this
agreement in 180 days. During this 180 day term period MGI
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will pay NSS commissions on all shipments to accounts in
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Market or the retainer listed in Xxxxxxxxx 0x and NSS will
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continue to service all accounts, attend scheduled meetings
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and act in "good faith" under the performance of this
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Agreement until the expiration of the 180 day period of the
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effective date of termination. NSS shall abide by the same
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rights and rules of termination and notification as MGI.
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This agreement is automatically renewed each year on
January 1st unless the six months termination notification is
implemented. Notwithstanding any of the above, should there
be a default by NSS of any of the terms of this Agreement,
MGI shall immediately notice NSS in writing of this default
and allow thirty (30) business days for NSS to
effect a cure for the default to the satisfaction of MGI.
Should there be no cure for the default, MGI shall have the
right to immediately cancel this Agreement canceling the
terms of termination in Paragraph 7 without further
notification.
8) Indemnification.
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a) Indemnification by NSS. NSS represents and warrants
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that it has the right to enter into this Agreement and
perform its obligations hereunder. NSS shall indemnify
and hold harmless MGI, its successors and assigns ant
their respective shareholders, officers, directors,
employees or agents from any loss, damage, injury, or
other casualty suffered MGI or its employees or agents
to the extent caused by a breach by NSS or its
employees or agents of its warranties or obligations
under this Agreement. This indemnity is in addition to,
an not in lieu of, any other rights or remedies MGI may
have under this Agreement or at law in equity.
b) Further, NSS understands that MGI is subject to certain
"SEC" Rules and Regulations since it is a publicly
traded company. As such, it will contact and receive
approval from MGI before disseminating any news that it
might become aware of in the general course of
business. Such new might consist of the opening of new
accounts, volume of business or new product
introductions, but is not limited to these events. By
virtue of this contact NSS, its management and
employees are hereby notified that they are restricted
from any short term trading in MGI securities due to
information gathered that has not been disseminated to
the public at large through PR or News Releases
("Xxxxxxx Xxxxxxx Regulations").
c) Indemnification by MGI. MGI represents and warrants
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that it has the right to enter into this Agreement and
perform its obligations hereunder. MGI shall indemnify
and hold harmless NSS, its successors and assigns and
their respective shareholders, officers, directors,
employees and agents, from any loss, damage, injury or
other casualty suffered by NSS or its employees or
agents to the extent caused by a breach by MGI or its
employees or agents of its warranties or obligations
under this Agreement or as a result of a claim of
product liability or other equitable or legal claim
arising from the Products. This indemnity is in
addition to, and not in lieu of, any other rights or
remedies NSS may have under this Agreement or at law in
equity.
9) Entire Agreement. This Agreement and the Exhibits and the
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attachments hereto constitute the entire agreement between
NSS and MGI with respect to their relationship and supersede
any and all prior agreements and understandings, whether oral
or written, between them. Except to the extent specifically
provided herein, this Agreement may be modified only in a
writing signed by both parties.
10) Notices. All notices required or permitted under this
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Agreement shall be in writing an shall be effective when
personally delivered or when mailed, by first-class mail with
postage paid, to Xxxxxx X. Xxxx, National Sales Solutions,
0000 Xxxxxxxxx Xxxxxx Xx., Xxxxxxxx, XX 00000-0000 an to Xxxx
Xxxxxxx, Med Gen, Inc., 0000 Xxxx Xxxxxxxx Xxxx Xxxx, Xxxxx
000, Xxxx Xxxxx, XX 00000. NSS or MGI may change its address
or person designated to receive the notice for the purpose of
notice by giving written notice of such change.
11) Governing Law. This Agreement shall be governed by and
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construed in accordance with the laws of the State of
Florida, County of Palm Beach. Any controversy or claim
arising out of or relating to
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this Agreement shall be settled in arbitration in accordance
with the Rules of the American Arbitration Association
located in Palm Beach County, FL. Any judgment upon the award
rendered in such arbitration may be entered in any court of
competent jurisdiction.
12) Binding Effect and Assignment. This Agreement
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shall be binding upon and inure to the benefit of and be
enforceable by the parties to this Agreement and their
successors and assigns. The parties are to perform their
obligations, hereunder, beginning January 1, 2005.
13) Severability. In the event that any court of competent
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jurisdiction declares any clause or term of this Agreement to
be invalid, void, voidable, illegal, unenforceable, or
against public policy, the remaining terms herein shall
remain in full force and effect.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement
effective as of the day and year first above written.
NATIONAL SALES SOLUTIONS, LLC MED GEN, INC.
/S/Xxxxxx X. Xxxx /S/Xxxx Xxxxxxx
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Signature Signature
1/23/05 1/20/05
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Xxxxxx X. Xxxx Xxxx Xxxxxxx
President Chairman & CEO
1421 Ridgetree Trails Dr. 0000 Xxxx Xxxxxxxx Xxxx Xxxx, Xxxxx 000
Xxxxxxxx, XX 00000-0000 Xxxx Xxxxx, XX 00000
Federal Tax ID: 00-0000000 Federal Tax ID#: 00-0000000
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