EXHIBIT 10.8
ADVERTISING AGENCY AGREEMENT
THIS AGREEMENT is made effective October 1, 2001 between Endeavor
Pharmaceuticals, Inc., a Delaware corporation, with Headquarters located at 127
Racine Drive, Suite 202, Wilmington, NC 28403 and with the Sales and Marketing
Office located at 8 Campus Drive, Third Floor East, Parsippany, NJ 07054
(hereinafter referred to as "Company") and Accel Healthcare Communications,
LLC., a Delaware limited liability company with a place of business at 30 Irving
Place, New York, NY 10003 (hereinafter referred to as "Agency").
WHEREAS, Company is interested in retaining the services of an
advertising agency for advertising and promotional activities for CE10
(conjugated estrogens) with brand name to be determined (hereinafter referred to
as the "Product"); and
WHEREAS, Company and Agency have executed a CONFIDENTIAL DISCLOSURE
AGREEMENT dated July 23, 2001 (the "CONFIDENTIAL DISCLOSURE AGREEMENT"); and
WHEREAS, Agency has represented to Company that it possesses all
requisite skills, knowledge, experience and technical capabilities to perform
these services for Company;
NOW, THEREFORE, and in consideration of the mutual promises and
covenants hereinafter set forth, Company and Agency agree as follows:
1. AGENCY SERVICES
Company appoints Agency to serve as Company's advertising agency on a
non-exclusive basis in the United States with respect to such Product
and such services as Company may designate in accordance with a
mutually agreed upon Scope of Work. Agency agrees that it will not
accept other clients or work on other products where such work would
create a conflict of interest with Company's Product without the prior
written approval of Company. The Scope of Work for 2001-2002 is
attached to this Agreement as Schedule A and made part hereof. Company
may from time-to-time revise the Scope of Work for reallocation of
hours from anticipated projects to others and, such revised Scope of
Work shall govern thereafter. In addition to the tasks outlined in the
Scope of Work, Agency's duties shall include upon Company's request but
not be limited to:
1.1 Assigning and obtaining Company approval of a highly
professional integrated team to provide services as requested
in the Scope of Work. The team must represent all Agency
services and departments, and one person, whose identity must
be approved by Company, must be
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designated as sole head of that team: Charlene Prounis,
Managing Partner. Agency shall also designate key leaders to
be the main contact for certain Agency functions. The
composition of the team will comply with the specifications of
the staffing plan, attached to this Agreement as Schedule B.
1.2 Ensuring the team assigned to Company understands the assigned
Product, services and offerings, the category/industry within
which Company operates, and the key customer categories where
the assigned Product will be marketed.
1.3 Providing monthly and quarterly reporting to Company on all
work performed in hours spent on Company business in a
mutually agreed upon format. Monthly reports will include:
monthly hours by project and by employee, with year-to-date
totals and variances from estimated hours.
1.4 Analyzing present and potential marketing and advertising
opportunities and providing Company with verbal and/or written
(as requested) point-of-view on such.
1.5 Analyzing and reviewing market research to provide Company
with timely counsel and a verbal and/or written (as requested)
point-of-view on implications and recommended actions.
1.6 Providing Company with input for pre-launch and launch
marketing plans, which put forward reasonable proposals for
reaching Company objectives.
1.7 Preparing all recommendations, materials and other elements as
may be necessary to present ideas to Company or as may be used
in the execution of ideas into finished communications.
1.8 Supervising production of communications materials when
requested.
1.9 Advising Company of the availability of all media that can be
appropriately used in promoting the Company Product and
services.
1.10 Rendering all services necessary for the proper and efficient
use of all media in accordance with industry standards.
1.11 Negotiating and arranging for the contracting for all talent
including residuals. All such contracts with talent shall
reflect the independent contractor status of the talent and
shall provide that Company will not be responsible for taxes
or benefits of any kind on behalf of the talent.
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1.12 Except as set forth herein or otherwise agreed by the parties,
negotiating, arranging and contracting for all photography,
models, special effects, etc., as required within the Scope of
Work for the production of communications materials whether
broadcast or other.
1.13 Conducting research on and analyzing competitive spending and
messages when requested by the Company.
1.14 Providing reviews and assessing implications of significant
industry trends, such as direct response advertising and
evolving FDA regulations when requested by the Company.
1.15 Attending strategy and other meetings and performing research
as requested by Company.
1.16 Providing comprehensive project management and reporting for
all Agency departments, which can be used to plan and track
all programs and projects.
1.17 Providing other services as requested by Company and agreed to
by Agency with appropriate adjustments in the Scope of Work
and personnel assigned to the Product, if necessary.
1.18 Coordinating and cooperating as necessary with other agencies
or vendors retained by Company for the Product.
2. GENERAL TERMS
2.1 The parties recognize that this is a non-exclusive agreement
and during the term hereof, Agency may act as an advertising
agency for other pharmaceutical or chemical manufacturers
provided that Agency's services for/with such other companies
will not create, in the judgment of Company, a conflict of
interest (including, but not limited to, products related to
menopause including vasomotor symptoms, vaginal-vulvar
atrophy, osteoporosis, female sexual dysfunction, androgen
insufficiency, rapid wasting syndrome). Agency agrees that it,
including subsidiary companies, will not provide the services
contemplated herein for any product or service, which is
competitive with the Product, without specific written
approval from Company. Additionally, no individual performing
services under this Agreement shall perform similar services
for any product or service, which is competitive with the
Product for any affiliate of Agency, without specific written
approval from Company. It is also understood that Company may
engage advertising agencies for the Product other than Agency.
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2.2 Agency agrees to devote its reasonable best efforts to
Company's interests and to attempt in every way to make
Company's programs successful; Company agrees to aid Agency in
so doing by making available to Agency needed information and
materials pertaining to Company's Product and to cooperate
with Agency in expediting its work on Company's behalf.
2.3 Agency shall in no event place any advertisements of Company
in any advertising medium without first submitting the text
and designs therefor to Company and obtaining Company's
written approval. Agency agrees to comply with reasonable
requests of Company to deliver proposed pieces with sufficient
time for internal review.
Before incurring liability on Company's behalf for any item of
space or time in an advertising medium, or for artwork,
mechanical arts, printed matter, services or expenditures
within the scope of this Agreement, Agency shall obtain the
Company's prior written approval.
Agency shall be entitled to rely and act upon authorization
given by the members of the Company marketing team assigned to
work on the Product who are designated by Company in writing
as being empowered to give such instruction, approval, or
authorization as attached hereto and incorporated herein
Schedule C, as amended.
2.4 Agency shall use its reasonable best efforts to guard against
any loss to Company through failure of media or suppliers to
properly execute their commitments; but Agency shall not be
held responsible for any failure on the part of said media or
suppliers, unless such failure is due to or caused by the
negligence of Agency. However, when media or suppliers fail to
properly execute their commitments, Agency shall not settle
any disputes regarding such deficient performance without the
Company's prior written approval of the form and substance of
such settlement. Company shall be a third party beneficiary to
such agreement and shall have the right to seek recourse
against said media or supplier and Agency hereby agrees to
subrogate its rights thereto, except where agreements existing
on the effective date of this Agreement prohibit the
subrogation of Agency's rights, at Company's request.
2.5 Agency represents and warrants that performance of the
services required under this Agreement does not violate any
agreements or relationships existing between Agency and any
persons by whom Agency may otherwise be employed or with whom
Agency may have contractual arrangements.
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2.6 Agency represents and warrants that all material supplied to
Company or used on behalf of Company pursuant to this
Agreement shall either (i) not infringe the copyright of any
third party, or (ii) be licensed at net cost to Company under
a third party copyright. Company shall have the right, in its
discretion, to examine copies of releases obtained by Agency.
Agency further represents and warrants that Company shall be
free to use such material under this Agreement without
interference by or claims of third parties, subject to any
limitations on usage contained in the aforesaid releases,
licenses or other documentation and brought to the attention
of Company in writing prior to Company incurring any costs
related thereto.
In addition, in the event that the work carried out by Agency
in connection with this Agreement may utilize the names or
likenesses of independent third parties, Company shall not, in
such instance, be obligated for any additional consideration
or payment to such individuals, except where Agency has
obtained Company's prior approval to incur such additional
consideration or payment obligation, and Agency hereby
covenants and warrants that use of such names or likenesses
shall be legally and properly arranged.
2.7 All documents or other materials supplied to Agency by Company
and/or prepared by Agency for Company under this Agreement
("Work Product") shall be property of Company and shall be
delivered to Company at any time upon Company's request, or no
later than the termination of this Agreement, provided Agency
has been timely paid for the Work Product to be delivered.
Agency hereby transfers and assigns to Company any copyright
in such Work Product, including all of the exclusive rights
comprised in such copyright, whether published or unpublished
except for any proprietary products and software the Agency
developed, such as STAGES and e-visor, in which case the
Agency shall grant the Company a fully-paid non-exclusive
world-wide license in such products and software if they are
incorporated into any of the Company's Work Product to the
extent required to use such Work Product. Agency shall ensure
and hereby covenants that all individuals working on such Work
Product have assigned to Agency their rights to such Work
Product. Agency agrees to execute any documents necessary to
assign to Company Agency's full copyright interest in the Work
Product either solely or jointly with others for Company
pursuant to this Agreement. Also, it is clearly understood
that no restrictions will be placed on Agency by third parties
with respect to any Work Product without the prior written
consent of Company.
2.8 Agency shall not disclose the terms of this Agreement. This
Agreement does not entitle Agency to use the Company's name or
trademarks of Company, in any way, without prior written
authorization.
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2.9 The parties agree that the CONFIDENTIAL DISCLOSURE AGREEMENT
between the parties executed on July 23, 2001 (set forth in
Schedule F) is hereby incorporated by reference into this
Agreement, except that the term of said CONFIDENTIAL
DISCLOSURE AGREEMENT shall continue for seven years past the
termination of this Agreement. Agency agrees that all
information (oral, written or computerized), report,
instrument, document or paper generated or developed for
Company or provided to Agency by or on behalf of Company,
including the terms of this Agreement, shall be considered a
trade secret, proprietary and confidential information of the
Company as defined in the CONFIDENTIAL DISCLOSURE AGREEMENT
(the "Confidential Information").
Agency agrees (i) to use the Confidential Information only in
connection with its performance of this Agreement; (ii) to
disclose the Confidential Information only to those employees
who need to know such Confidential Information because they
are assisting in the performance of the services hereunder;
and (iii) will not disclose Confidential Information to any
third-party without the prior written consent of Company, and
prior to such approved disclosure shall require such third
parties to execute a confidentiality agreement protecting
Confidential Information in a form approved by Company.
2.10 Agency understands and agrees that, for purposes of this
Agreement, Agency and any employee(s) or other individual(s)
designated by Agency to perform services under this Agreement
("staff members") are acting in the capacity of independent
contractors. Agency is responsible for staffing the project
and providing any and all compensation and/or benefits to its
staff members. Company is not responsible for withholding, and
shall not withhold, taxes of any kind from any payments it
owes to Agency unless required by law. Agency agrees to comply
with all laws related to withholding and payment of payroll
taxes related to individuals providing services hereunder.
Neither Agency nor any of its staff members has authority to
represent or act on behalf of Company without Company's prior
written consent. Further, as independent contractors, neither
Agency nor any of its staff members is eligible to participate
in, nor are they eligible for coverage under, any of Company's
benefit plans, programs, employment policies or procedures or
workers' compensation insurance. In consideration of Company
agreeing to use Agency's services hereunder, Company will be
released from any liability arising from Company's failure to
provide such plans, programs, policies, procedures and
workers' compensation insurance. Agency shall defend and
indemnify Company for any and all claims, losses, injuries or
damages that may be asserted against Company as an alleged
employer
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with respect to any Agency employee or third party vendor
employee providing services in connection with this Agreement.
2.11 Any contract or other agreement that Agency enters into with
any third party for purpose of implementing this Agreement
(hereinafter "Agency Contract") will be solely between Agency
and such other third party. Agency has no authority to bind
Company. Each such Agency Contract (i) shall contain terms,
conditions and covenants that are substantially similar to
this Agreement, including, but not limited to, obligations of
confidentiality, assignment of copyrights and inventions (as
set forth in Sections 2.7, 2.9 and 2.12, respectively), and
(ii) shall expressly provide that such Agency Contract neither
creates a third party beneficiary relationship between Company
and such third party, nor vests any right of action to such
third party against Company. Agency remains responsible for
the performance of third parties under Agency Contracts.
Agency shall defend and indemnify Company for any and all
claims, injuries or damages of any kind that occur in
connection with any Agency Contract and/or the performance
thereunder, and Company will not be liable in any manner in
connection with claims of any nature. In the event that this
Agreement is terminated and Company wishes to retain another
agency to perform the services defined in Section 1 above,
Agency shall, at the request of Company, assign to Company or
its designee any such Agency Contract(s). Accordingly, each
Agency Contract shall contain a clause permitting Agency to
assign the contract to Company.
2.12 All information, inventions, discoveries, patent rights,
trademarks and copyrights which result from any services
performed by Agency pursuant to this Agreement ("Inventions"),
will be the exclusive property of Company. Agency shall
promptly disclose in writing to Company each such Invention
and provide to Company all information known to Agency
reasonably relating to such Invention. Agency agrees to sign
all necessary documents or take such other actions as Company
may reasonably request in order to perfect and enforce any and
all of its rights in such Inventions. In particular, Agency
shall assign to Company all of Agency's right, title and
interest in and to each such Invention. All costs and expenses
for perfecting and enforcing its rights in such Inventions
shall be born by Company.
3. AGENCY COMPENSATION
3.1 Company shall pay Agency professional fees at a blended rate
of $130 per hour for work performed by Agency at the request
of Company, consistent with the Scope of Work, as revised.
This fee shall be paid in monthly payments of $85,861.00, (the
"Pro Rata Monthly Fee") with a
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quarterly adjustment based upon the quarterly reconciliation
described below. In addition, Company shall reimburse Agency
for direct out-of-pocket expenses incurred by Agency
consistent with Sections 4 and 5 hereof.
3.2 Before commencing work on any given project, Agency will
provide a creative work plan/project description prior to the
initiation of new projects for Company approval. Agency shall
also submit to Company a cost estimate, including estimated
hours necessary for completion, and out-of-pocket expenses,
and shall obtain the prior written approval of Company to
proceed in accordance with Schedule C. Agency shall not exceed
the estimate by 10% for any project without prior written
approval by Company.
3.3 At the beginning of each calendar month, Agency shall submit
an invoice to Company for the Pro Rata Monthly Fee. Payment
for all invoices is due within thirty (30) days of receipt of
original invoice by Company, unless agreed otherwise by both
parties. Company will not pay for any services invoiced, or
identified in a quarterly reconciliation, more than three (3)
months after such services were performed unless prior written
notification is provided to Company. The Agency shall
reconcile the hours billed by Agency for each calendar quarter
to the Pro Rata Monthly Fee and report on the status of the
project(s). Agency will provide such quarterly reconciliation,
outlining the total hours worked compared to projected hours
with the invoices for the last month in each calendar quarter.
The variance will be addressed through a credit in dollars to
the Company or as an addition in dollars to the Agency. Such
credit or addition shall be applied against or added to the
next invoice for the Pro Rata Monthly Fee.
3.4 The total amount to be paid by Company for services rendered
during the term of this Agreement and for expenses incurred
consistent with Sections 4 and 5 shall not exceed
$2,482,660.00 without the prior written consent of Company.
3.5 Any purchase order issued by Company in connection with this
Agreement shall be for payment purposes only, and shall not be
deemed a contract document and its terms and conditions shall
not apply.
4. AGENCY REIMBURSEMENT
4.1 Agency shall provide estimates of direct out of pocket
expenses to Company for each project. Unless indicated
otherwise in this Section 4, Agency shall invoice Company for
direct out of pocket expenses as
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follows: (i) 20% of the project expenses as an advance upon
approval and start of a project, (ii) an additional 40% of the
project expenses as an advance at disk release or the midway
point of the project, as agreed to by Company, and (iii) a
final invoice upon the completion of the project presenting
total actual project expenses, that are no greater than 10% of
the original estimate, less any advance payments made by the
Company
4.2 Company shall reimburse Agency for reasonable direct expenses
incurred under this Section and Section 5 within thirty (30)
days of its receipt of an invoice, including adequate
supporting documentation. Itemized expenses will be provided
with the final invoice for a project. Such invoice will
include only those expenses incurred pursuant to this Section
and Section 5 of the Agreement, and shall be a separate
invoice from that provided under Section 3. Invoices shall
include receipts for all items in the amount of $25.00 or
more, and such receipts shall be cross-referenced to the
invoice or project.
4.3 Agency shall take advantage of all payment discounts offered
by vendors for the Company's projects. If the advance payments
described in Section 4.1 above does not provide the Agency
with adequate working capital to take advantage of interim
payment discounts offered by vendors or make other advance
payments required by vendors, Agency shall request an
additional advance payment from Company in order to take
advantage of such payment discounts or make other advance
payments required by vendors. Company shall be entitled to a
credit for any potential payment discounts not taken by
Agency, unless Company had instructed Agency in writing not to
take advantage of such payment discounts, to the extent such
potential discounts individually are equal to or greater than
$1,000.
4.4 Agency shall submit all media and other invoices in adequate
time for Company to review such invoices and obtain volume and
cash discounts associated with the final invoice for a
project. Agency will indicate discount payment terms on
invoices to Company. Agency will follow a billing format that
is satisfactory to Company. Invoices must be provided to
Company no more than 120 days after the date the applicable
payment is earned unless prior written approval for delayed
billing is authorized by Company. Notwithstanding the
foregoing, Agency must provide to Company no later than the
first week in December an itemized list of any and all
expenses incurred or to be incurred hereunder prior to year
end, but not yet billed to Company, in order to obtain
reimbursement for such expenses in the following calendar
year.
4.5 Agency shall not share directly or indirectly in the profits
of any third party in connection with Agency services
hereunder without the prior written consent of Company. Agency
shall not "mark up" or take a commission
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for any product or service provided for Company, whether it be
from a third party or a corporate affiliate. Company shall be
entitled to a pro-rata share of any rebates received by Agency
from any third parties.
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4.6 Media
If Agency is directed to buy media space or time, costs will
be billed to Company at net cost (without mark-up and less all
discounts or rebates earned) as follows:
a. Radio, newspaper, television and outdoor and on-line
time or space costs will be billed on an estimated
basis before the month in which the advertising is to
appear. Such invoices will be accompanied by
corresponding media schedules.
b. Consumer and trade magazine space will be billed
during the month prior to the month in which the
advertising is to appear. Such invoices will be
accompanied by corresponding media schedules.
c. Agency will adjust the estimated media costs to
actual cost and refund any overpayment to Company or
bill for additional charges within sixty (60) days of
receipt of invoices from publishers and stations.
d. Agency or its designee will inspect and check tear
sheets for all print insertions on behalf of Company
and maintain a record that each ad has been verified.
Publications (newspapers, magazine, trade papers,
etc.) containing Company's advertising will be
retained in Agency's files for one year after
publication, for Company's inspection.
e. Affidavits from audio and television stations will
also be retained in Agency's files for one year after
the date of the program for Company's inspection.
4.7 Production
a. Agency will commence work upon receipt of an approved
estimate for production costs for marketing
communications.
b. Television, audio-visual and videotape production
costs will be invoiced to Company as follows: (i)
One-third (1/3) of total estimated cost when estimate
and contract have been agreed upon by Company, (ii)
an additional one-third (1/3) of total estimated cost
when filming and or taping is completed, and (iii)
the remaining balance of total actual cost when a
work print or edited tape of commercial is approved
by Company.
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c. Upon receipt of supplier invoices, Agency will submit
final adjustment billing as necessary, but in no case
later than sixty (60) days after a work print or
edited tape of commercial is approved by Company.
4.8 Materials and Services
Postage incurred in shipping, mechanical art, copy and layout
will be charged at cost to Company. Postage costs incurred by
Agency for direct mail will be paid to Agency prior to each
mail date. Company shall not be liable for any portion of
overhead costs and/or subscriptions incurred by Agency in the
normal course of business, such as, but not limited to,
charges associated with basic telephone service and equipment
leases.
4.9 Agency shall exert its reasonable best efforts to obtain for
Company the most favorable rates and terms for all items
charged to Company, shall obtain multiple bids from third
parties for such items, and shall comply with all existing
Company guidelines for soliciting bids from third parties for
such items. Agency will also consult with Company to determine
if there are approved vendors for certain categories of
services, and if such approved vendors exist, will utilize
Company approved vendors.
5. REIMBURSEMENT OF TRAVEL AND ENTERTAINMENT COSTS
Agency shall submit copies of all hotel bills and other reimbursable
expenses along with the associated charges and receipts. Invoices for
all reimbursable expenses shall list the dates, company, persons
visited and business purpose for the expense. Receipts for expenses are
required for all single expenditures of $25.00 or more. If Agency
personnel conduct work on behalf of another client during travel
related to a specific Company project, the number of hours billed to
Company for such travel shall be reduced by the number of hours spent
performing work on such other client's behalf. In the event travel
and/or lodging is related to both a specific Company project and the
business of another client, the cost of such travel, lodging and
related expenses shall be pro-rated.
5.1 Travel. Agency will bear the cost, without charge to Company,
of all normal travel expenses (out-of-pocket) of Agency
personnel engaged in regular activities, including travel
between Agency's offices and Company offices in New Jersey.
With the exception of the foregoing, Company will reimburse
Agency for the actual cost of travel expenses incurred by
Agency personnel when traveling at Company's request or
working on tight deadlines necessitating late nights (after 8
pm) which require Agency
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to provide safe transportation within the Agency's policy
(Taxi service within NYC or to nearest suburban train
station).
5.2 Airline Travel. Air travel, when requested by Company, will be
reimbursed by the Company. All air travel must be directly
related to a specific Company project. Agency shall utilize
the lowest available coach class airfare. The ticket stub or
e-ticket receipt and boarding pass must be presented with the
billing invoice.
5.3 Taxi, bus, rail or car rental. Taxi, bus, rail and car rental
expenses along with associated receipts for tolls and parking
will be reimbursed by the Company. Reimbursement for car
rentals will be made upon presentation of a car rental
agreement/receipt. Car rentals must be contracted at the
lowest available rate and in the compact/subcompact category
where possible, unless special requirements dictate otherwise,
in which case prior Company approval is required.
5.4 Lodging. Agency should use reasonable discretion in regards to
hotel selection and hotel rates. Agency shall only invoice
hotel expenses that are directly related to the work performed
under this Agreement.
5.5 Meals and Entertainment. Working meals with Company employees
during normal business hours will be reimbursed by Company.
Billing should include names of all attendees and the subject
matter discussed. Meals with Company employees during
non-business hours will not be reimbursed. All other
entertainment expenses such as theater tickets etc. are
non-reimbursable, unless authorized in writing by a Vice
President of Company.
5.6 Travel Time. The Company will be charged for travel time at
the lower of actual time spent traveling or five hours per day
when airline or long-distance (Amtrak) train is used or two
hours per day when car or local transportation is used, unless
prior written approval by Company is obtained by Agency.
5.7 All reimbursement for travel costs will be governed by
Schedule E Company Corporate TRAVEL GUIDELINES.
6. CHANGES OR SUSPENSION OF WORK
6.1 Company may, during progress of any work hereunder, by written
or oral order to Agency, require additions, modifications,
suspension or termination of such assigned work. However, any
such oral orders shall
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be confirmed in writing as soon as reasonably possible by
Agency or Company.
6.2 Company reserves the right, in its sole discretion, to modify,
reject, cancel or stop any and all projects, plans, schedules
or work in progress. Company will make every effort to provide
Agency with reasonable notice for substantial increases or
reductions in assigned work. In such event, Agency shall
immediately take all necessary action to execute Company's
instructions. Provided Agency proceeds in full accordance with
Company's instructions, Company will assume liability and make
payment for all non-cancelable commitments and will pay Agency
for charges incurred for canceled or changed work up to the
date of notice of cancellation or change. The provisions of
this Section shall not be construed as committing either party
to breach any lawful contractual commitments to media.
7. ADDITIONAL CHARGES FOR UNSCHEDULED SERVICES
There will be no compensation under this Agreement for (i) preparation
of any estimates or (ii) work done in connection therewith, in the
event Agency prepares a bid or proposal for Company regardless of
whether Agency's bid or proposal is accepted by Company.
8. TEMPORARY/FREE-LANCE HELP
8.1 If administrative personnel are hired through a temporary
employment service, they are employees of the employment
service. As such, their costs should be a direct out of pocket
expense charged to the Company without markup.
8.2 Professional Free-lancers and independent contractors who are
hired by the Agency will track and report their hours in
accordance with this Section 3 of this agreement and have
their hours included and accounted for in the quarterly fee
reconciliation. Such independent contractors will not be
charged as an additional out-of-pocket expense.
9. TERM AND TERMINATION
9.1 This Agreement is effective as of October 1, 2001, and shall
continue through December 31, 2002 unless terminated by
Company, with or without cause, upon the giving of sixty (60)
days written notice to Agency.
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9.2 Upon receipt of the termination notice (the "Notice Date"),
Agency, at the request of and as specified by Company, shall
cancel all cancelable contracts and commitments entered into
by Agency on behalf of Company during the term of this
Agreement. As of the termination date, Agency shall assign to
Company or its designated agents non-cancelable contracts and
work in progress previously approved by Company. With respect
to such contracts and work in progress, Company shall make all
payments to which Agency is entitled under this Agreement
through the termination date.
9.3 After the Notice Date, Company will pay Agency the lesser of
(i) two Pro Rata Monthly Fee payments or (ii) the difference
between the amount specified in Section 3.4 and the total of
all invoices charged or chargeable to the Company through the
Notice Date. Agency shall perform only those services and
incur only those expenses and charges that are specifically
requested by Company or required under this Agreement, after
the Notice Date. All reconciliation's required under this
Agreement will apply to periods through the Notice Date and no
such reconciliation's will be required for periods after the
Notice Date.
9.4 In the event there is any credit due to Company hereunder,
Agency shall promptly reimburse Company for such credit within
thirty (30) days of the termination date.
9.5 Following the termination of this Agreement, to the extent
that either Agency or Company has ownership rights, Agency
shall transfer to Company in the format prescribed by Company,
and Company shall be entitled to use, without further
obligation, all plans, ideas, sketches, copy, layouts,
commercial material, films, and the like submitted to Company
by Agency. Agency shall also promptly return all Company
property and documents in its possession.
9.6 The obligations of the parties contained in Sections 2.4, 2.6,
2.7, 2.8, 2.9, 2.10, 2.11, 2.12, 9.4, 9.5, 10.1, 12, 16.4, and
16.5 hereof shall survive any expiration or termination of
this Agreement.
10. INDEMNIFICATION AND INSURANCE
10.1 Agency agrees to indemnify Company for, and to hold Company
harmless from, any damage claims, including attorneys' fees
and costs of suit, asserted against Company resulting from (i)
any breach by Agency of the representations and warranties
contained in Sections 2.5 and 2.6 and/or (ii) the negligent or
willful actions of Agency, which affect the rights or property
of any third party, including, but not limited to, claims
involving
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copyright infringement, false or misleading statements,
violations of personal rights of privacy, misappropriation of
ideas or rights, and literary piracy or plagiarism. Agency,
prior to the settlement of any such claims at its own expense,
agrees to obtain Company's prior written approval of such
settlement, which shall not be unreasonably withheld.
10.2 Company agrees to similarly indemnify and hold Agency harmless
with respect to, any advertising or promotion materials and
commercial data or material relating to the Company or
Product, including claims about the Product, furnished to
Agency by the Company specifically for inclusion or to be
incorporated into any advertisements or marketing or
promotional materials produced by Agency, as a result of which
claims or suits involving deceptive advertising, unfair
competition or product disparagement are made against Agency.
Company further agrees to indemnify and hold Agency harmless
with respect to claims related to the use or consumption of
Company's products in market testing or general public usage.
10.3 Notwithstanding any other provisions of this Agreement, Agency
shall procure and obtain during any term of this Agreement
insurance in a form and with a carrier satisfactory to Company
as follows:
(a) Worker's Compensation including Occupational Disease
and Employer's Liability Insurance covering all of
Agency's employees engaged in the performance of this
Agreement.
(b) Commercial General Liability including personal
injury and broad form contractual coverages. The
Limit of Liability should be not less than
$10,000,000 combined single limits. The Certificate
of Insurance shall provide that Company is an
additional insured, and shall also provide that
Company is to be notified of a cancellation or
material change in the coverage afforded not less
than thirty (30) days prior to such cancellation or
change.
(c) Advertising Agency Professional Liability Insurance
in an amount of not less than $10,000,000. The
Certificate of Insurance shall provide that Company
is an additional insured, and shall also provide that
Company is to be notified of a cancellation or
material change in the coverage afforded not less
than thirty (30) days prior to such cancellation or
change.
(d) Certificates of the above insurance must be filed
with Company by Agency within ten (10) days after
execution of this Agreement.
16
Certificates shall provide at least thirty (30) days
prior notice of cancellation or non-renewal of
coverage.
11. AUTHORIZED PERSONNEL
Agency may rely on authorized employees per Schedule C or agents
designated in writing by Company to approve with signature or initials
any media placement, advertising copy, graphic, product, marketing
programs and any activity necessary for completion of any project
assigned to Agency.
12. AUDIT AND ACCOUNTING
12.1 Company's Right to Review Agency's Books
During the term of this Agreement and one year thereafter,
Company or an audit firm engaged by Company shall have the
right upon ten (10) business days notice, to review Agency's
books, records, systems, processes and accounting practices as
they pertain to services rendered to Company. Agency shall
maintain complete records including individual time-keeping
cards, the cost of all materials and services purchased and
work subcontracted to other parties, requests for proposal and
bids. Such records shall be maintained under good internal
control practices, in accordance with GAAP and in such a
manner as may be readily audited. Such records, including all
supporting documents, shall be available at Agency's premises.
12.2 Changes in the Agency's Cost Accounting
Agency will not change its cost accounting system, policies or
practices during the term of this Agreement unless ninety (90)
days written notice is provided to Company. Such notice should
describe in adequate detail the nature of changes proposed and
the impact, if any, to Company. The Company will not be
invoiced or charged in any way for added costs resulting from
any change in Agency's cost accounting system without
Company's prior written approval.
13. ASSIGNMENT
This Agreement may be assigned by Company as part of the sale of
substantially all of its business, or may be assigned by Company to a
company controlled by it, or controlling it, or under common control
with it. Agency agrees
17
that if this Agreement is assigned to any such company, all the terms
and conditions of this Agreement shall remain between such other
company and itself with the same force and effect as if said Agreement
had been with such other company in the first instance. This Agreement
is deemed personal to Agency, and Agency shall therefore have no right
or authority to assign this Agreement or any portion thereof or
otherwise delegate its performance under this Agreement.
18
14. NOTICES
Any formal notices permitted or required hereunder shall be in writing
and shall be deemed to have been given on the date of delivery if
delivered, or on the date of receipt, if mailed by registered mail,
postage prepaid, at the respective addresses below or at such other
address as either party hereto may designate by notice pursuant hereto.
All notices forwarded to Company shall be sent as follows:
Ms. Kathleen Milligan,
Vice President, Marketing
Endeavor Pharmaceuticals, Inc.
8 Campus Drive, 3rd Floor
Parsippany, NJ 07054
Telephone (973) 683-0070
Facsimile (973) 683-0075
With a copy to:
Mr. Stephen F. Rizzo
Vice President and Chief Financial Officer.
Endeavor Pharmaceuticals, Inc.
Racine Drive, Suite 202
Wilmington, NC 28403
Telephone (910) 790-9811
Facsimile (910) 790-9041
All notices forwarded to Agency shall be sent to:
Ms. Charlene Prounis
Managing Partner
Accel Healthcare Communications
30 Irving Place
New York, NY 10003
Telephone (646) 602-6904
Facsimile (646) 602-6901
15. COMPANY BUSINESS PRACTICES
Agency recognizes that it is Company's policy to comply with all
applicable laws, regulations, permits and consent orders and to act in
a proper and ethical manner. Accordingly, in connection with the
services provided hereunder for
19
Company, Agency agrees to comply with all applicable laws, regulations,
permits and consent orders. The Company may terminate this Agreement
immediately, without penalty or payment contemplated by Section 9.3, in
the event that Agency breaches the terms of this Section.
16. MISCELLANEOUS PROVISIONS
16.1 The waiver of any breach of this Agreement by either party
shall not constitute a waiver as to any future breach. This
Agreement embodies the entire agreement of the parties hereto
with respect to the subject matter hereof and supersedes any
and all previous agreements, oral or written, between Agency
and Company. This Agreement and any Schedules attached hereto
may not be modified or changed except in writing signed by
both parties. In the event of any inconsistency between the
Agreement and any attachment hereto, the terms of the
Agreement shall prevail.
16.2 Neither party shall be liable for the failure to perform its
obligations under this Agreement if such failure is occasioned
by a contingency beyond such party's reasonable control,
including, but not limited to, strikes or other labor
disturbances, lockouts, riots, wars, terrorist attacks, fires,
earthquakes, floods or storms. A party claiming a right to
excused performance under this Section shall immediately
notify the other party in writing of the extent of its
inability to perform, which notice shall specify the
occurrence beyond its reasonable control that prevents such
performance.
16.3 In the event of the merger of Agency into or with any other
entity, or the acquisition of Agency or its assets by any
entity, or the insolvency or bankruptcy, or the reorganization
or recapitalization which results in a change in the
controlling parties of Agency, or its making a general
assignment for the benefit of creditors, this Agreement may be
terminated forthwith in whole or in part in the sole and
absolute discretion of Company without liability or payment
contemplated by Section 9.3 attaching to Company as a result
thereof.
16.4 This Agreement shall be governed by the laws of the State of
North Carolina as if made in and to be performed in North
Carolina, without regard to its choice of law principles.
16.5 Agency agrees that Company and any of Company's affiliated
companies or assignees may use any of the materials produced
under this Agreement by Agency.
20
16.6 The Section headings of this Agreement are merely for the
convenience of the parties and are not to be construed as
modifying or changing the obligations or conditions expressed
in this Agreement.
16.7 Debarment.
(a) Agency hereby certifies that it has not been debarred
under the provisions of the Generic Drug Enforcement
Act of 1992, 21 U.S.C. Sec. 335a(a) and (b). In the
event that during the term of this Agreement Agency
(i) becomes debarred; or (ii) receives notice of an
action or threat of an action with respect to its
debarment, Agency agrees to immediately notify
Company. Agency also agrees that in the event that it
becomes debarred it shall immediately cease all
activities relating to this Agreement.
(b) In the event that Agency becomes debarred, this
Agreement shall automatically terminate, without any
further action or notice by either party. In the
event that Company receives notice from Agency or
otherwise becomes aware that (i) a debarment action
has been brought against Agency; or (ii) Agency has
been threatened with a debarment action, then Company
shall have the right to terminate this Agreement
immediately without further liability, including any
payment contemplated by Section 9.3, to Company.
(c) Agency hereby certifies that it has not and will not
use in any capacity the services of any individual,
corporation, partnership or association which has
been debarred under 21 U.S.C. Sec. 335a(a) or (b). In
the event that Agency becomes aware of the debarment
or threatened debarment of any individual,
corporation, partnership or association providing
services to Agency which directly or indirectly
relate to the activities under this Agreement, Agency
shall notify Company immediately. Upon the receipt of
such notice by Company or if Company otherwise
becomes aware of such debarment or threatened
debarment, Company shall have the right to terminate
this Agreement immediately without further liability,
including any payment contemplated by Section 9.3, to
Company.
(This space intentionally left blank.)
21
IN WITNESS WHEREOF, the parties by their duly authorized
representatives have caused this Agreement to be executed as of the respective
date written above.
Accel Healthcare Communications, LLC. Endeavor Pharmaceuticals, Inc.
By: By:
--------------------------------- ---------------------------------
Name: R. Forrest Waldon
-------------------------------
Title: President and Chief Executive
------------------------------ Officer
22
SCHEDULE A
AGENCY SCOPE OF WORK
EXHIBIT 1 provides 2002 detail and Agreement totals
EXHIBIT 2 provides 2001 detail
23
ADVERTISING AGENCY AGREEMENT
SCHEDULE A -- EXHIBIT 1
Scope of Work -- 2002
FEE PRINTING AND
PROJECT HOURS (HRS X $130) OOPS ADDITIONAL PRODUCTION OTHER COSTS
Strategic Planning/General (50 hours/month) 600 $ 78,000 $ 12,000 $ -- $ --
DDMAC Material Preparation 200 26,000 20,000
Enjuvia Logo Development 200 26,000 20,000
Enjuvia Message Development 200 26,000 5,000
Media Planning and Maintenance 250 32,500 3,000
General and Administration (25 hours/month) 300 39,000 6,000
Travel and Expenses 25,000
CONCEPT DEVELOPMENT
Positioning/Creative Development 400 52,000 50,000 25,000
Market Research Concept Testing 300 39,000 20,000
Package Insert 50 6,500 5,000
JOURNAL AD
Launch Ad + Brief Summary 225 29,250 25,000
CORPORATE PROMOTION --
Creative Development 150 19,500 45,000 29,750
Corporate Panel 150 19,500 22,000 10,000 1,500
Corporate Brochure (100,000) 175 22,750 25,000 10,000 45,000
DIRECT SELLING MATERIAL --
Sales Aid (2500) 450 58,500 45,000
File Card (30,000) 200 26,000 20,000
Annotated Sales Aid (1000) 200 26,000 10,000
Patient Brochure (500,000) 200 26,000 45,000 15,000
Patient Brochure on Menopause (1,000,000) 200 26,000 30,000 10,000
Dosing Card (30,000) 150 19,500 7,500
Reprint Carriers x 2 (60,000) 300 39,000 15,000
Waiting Room Display (30,000) 200 26,000 15,000
PharmAlert (solo mailing) 100 13,000 10,000 5,000
Telephone Message Pads (100,000) 50 6,500 5,000
Wholesaler Stocking Package 150 19,500 20,000 7,500
Pharmacy Sell Sheet (100,000) 100 13,000 10,000
Product Monograph (30,000) 400 52,000 45,000 15,000
Sample Closet Shelf Talker 225 29,250 20,000
Claims Support Document 100 13,000 5,000
Sample Packet Design 200 26,000 15,000 10,000
Trade Label 100 13,000 5,000
Formulary Kit (10,000) 300 39,000 40,000 20,000 12,000
Strategy Development 100 13,000 5,000
DIRECT-TO-PATIENT
Concept Development 300 39,000 50,000 30,000
Market Research (preparation and attendance) 150 19,500 20,000 5,000
Direct Mail or Pharmacy Package 235 30,550 20,000
DIRECT MAIL
Mediscripts 75 9,750 5,000
Announcement Mailer Med/Pharm Alert (2)
(1 solo; 1 co-op) 150 19,500 8,000 80,000
OPPORTUNISTIC SPENDING (PRODUCT AND PROGRAM OUTCOMES) 500 65,000 250,000
NEW PROGRAMS (TBD) 707 91,910
----------------------------------------------------------------------
TOTAL 2002 BUDGET 9042 $ 1,175,460 $ 1,003,500 $ 192,250 $ 138,500 $ --
TOTAL 2001 BUDGET (EXHIBIT 1) 865 112,450 52,750
------------------------------------------------
GRAND TOTALS 9907 $ 1,287,910 $ 1,056,250 $ 192,250 $ 138,500
=========== =====================
PRINTING AND PRODUCTION TOTAL $ 138,500
-----------
SUM OF OOPS/PRINTING/PRODUCTION $ 1,194,750
===========
TOTAL FEES $ 1,287,910
TOTAL OPPS/PRINTING/PRODUCTION 1,194,750
-----------
SUM OF FEES AND OOPS/PRINTING/PRODUCTION $ 2,482,660
===========
Note: OOP grand total for '02 is $1,056,250 which is inclusive of the additional
$192,250
21-1
ADVERTISING AGENCY AGREEMENT
SCHEDULE A - EXHIBIT 2
Scope of Work - 2001
PRINTING
PROJECTED FEE DEVELOPMENT AND OTHER
PROJECT HOURS (HRS X $130) OOPS ADDITIONAL PRODUCTION COSTS
ITEM AMOUNT
Strategic Planning/General (50 hours/month) 150 $ 19,500 $ -- $ -- $ -- $ --
Name Development 25 3,250 --
General and Administration (25 hours/month) 75 9,750 500
Travel and Expenses -- 25,000
Landscape Research (preparation and attendance) 125 16,250
Brand Research (preparation and attendance) 200 26,000 500
CORPORATE PROMOTION --
Internal Message Discovery 10 1,300 --
Competitive Messages 25 3,250 250
Questionnaire/Summary/Brand Workshop (2) 50 6,500 1,500
Market Research (preparation and attendance) (2) 80 10,400 5,000
Positioning/Tag lines/Message Development 50 6,500 --
Logo Development 75 9,750 20,000 10,000
---------------------------------------------------------------------------
TOTAL BUDGET 865 $ 112,450 $ 52,750 $ 10,000 $ -- $ --
===========================================================================
21-2
SCHEDULE B
AGENCY STAFFING PLAN
ACCEL STAFFING PLAN - 2001 AND 2002
%
Partner, Advertising (Charlene Prounis) 25
Partner (James Pelletier, Co-Chief Creative Officer) 25
Group Account Supervisor (Michael Banner) 70
Account Executive (TBD) 100
Assistant Account Executive 25
Creative Director, Art (Maria Casini) 25
Art Director (Adam Cohen) 100
Copywriter (Sal Diana) 100
Traffic/WP/Editorial/Support 70
Hours
Total hours = 5.4 FTE x 1,820 hours/employee 9,907
Time charges for highly skilled creative artists are not contemplated above and
will be invoiced to Company as out of pocket expenses. Agency shall provide an
estimate of such expenses and obtain Company approval prior to incurring any
such expenses.
100% of employee time is equal to 1,800 hours. This includes vacation, holidays,
summer Fridays and training days.
24
SCHEDULE C
COMPANY AUTHORIZED EMPLOYEES
FORREST WALDON, PRESIDENT & CEO
- Responsible for the strategic direction of the Company
- Will sign off on expenditures greater than $300,000.
KATHLEEN MILLIGAN, VICE PRESIDENT, MARKETING & SALES
- Responsible for overseeing the strategic direction of the
Company and its brands.
- Will sign off on Scope of Work.
- Will sign off on selected creative work plans/project
descriptions, media plans, marketing materials and estimates.
- Will sign off on expenditures up to $300.000.
LUCY HUTCHISON, SENIOR DIRECTOR, MARKETING
- Responsible for strategic direction of the Company and its
brands.
- Responsible for overseeing day-to-day strategy and tactical
execution of programs developed with Agency.
- Will sign off on Scope of Work.
- Will sign off on creative work plans/project descriptions, media
plans, marketing materials and estimates.
- Will sign off on expenditures up to $100,000.
DAVID TEMPLETON, PRODUCT DIRECTOR
- Responsible for the day-to-day strategy and tactical execution
of programs developed with Agency.
- Will act as primary "day-to-day" contact.
- Will sign off on creative work plans/project descriptions, media
plans, marketing materials and estimates.
- Responsible for internal budget tracking of agency fees and
OOPs.
- Will sign off on expenditures up to $10,000.
Any amendments to the Agreement, other than changes and adjustments to project
scope that do not result in an overall increase in Company liability, will
require the prior
25
approval of either R. Forrest Waldon or Stephen F. Rizzo, Vice President and
Chief Financial Officer.
26
SCHEDULE D
NOT USED
27
SCHEDULE E
COMPANY CORPORATE TRAVEL GUIDELINES
Agency is responsible to ensure that each Agency Employee complies fully with
this guideline. Although this guideline does mention Agency Employees, the
purpose of this guideline is to determine how Company will reimburse Agency for
its expenses.
I. Responsibility and Enforcement
Company will not reimburse Agency Employees or even review individual expense
reports, but rather only Agency invoices containing information on expenses
incurred. Company may see supporting documentation if requested for any expenses
it is being requested to reimburse.
The appropriate Company contact or their designees are responsible for reviewing
invoices for accuracy, ensuring compliance with travel expenses and guidelines
outlined in this agreement, and providing guidance regarding reasonable business
expenditures.
The Company will reimburse Agency for all reasonable and necessary expenses, as
more fully delineated in this agreement, while traveling or performing
authorized Company business.
The Company will not reimburse expenses that are not in compliance with this
agreement and travel guidelines, unless an exception authorization is obtained
in advance in writing. (see Section V. Policy Deviations).
Agency Employees who do not comply with travel expenses outlined in this
agreement may subject Agency invoices to delay or withholding of reimbursements.
Any falsification or misrepresentation of names, events, amounts or other
explanations, whether for personal gain or to deceive the person approving any
expense report or for any other reason , is prohibited and considered a serious
disciplinary offense which may subject the Agency to serious consequences, up to
and including termination.
II. Travel - Guidelines
A. Air and Rail Travel
Agency Employees purchasing tickets for travel on business for the
Company must purchase the most economical airline tickets or business class rail
accommodations.
28
The exchange of tickets at airline counters or at other travel agencies
for cash or other personal gain is prohibited.
B. Lowest Airfare Definition
Individuals should be booked using the lowest coach class airfares
available and consistent with business needs. These fares are determined based
on the following parameters.
- specially negotiated fares;
- nonrefundable fares when changes are not expected;
and
- Saturday night stay over
Full fare tickets may be issued for trips, which require frequent
changes, however, approval by Company is required.
An Agency Employee cannot decline an airline or hotel accommodation
because of preferred frequent flyer programs or other incentives for the Agency
Employee's benefit.
C. Domestic Travel
Domestic travel is defined as travel to any of the 50 United States,
Canada, Puerto Rico, or the Virgin Islands.
All domestic air travel must be in coach class, except when medically
restricted. Agency Employees should make every effort to book the most direct,
economical carrier consistent with business needs.
D. International Travel
International travel covers all travel other than that previously
described as domestic.
Any International travel must have prior written authorization from the
Company Vice President of Sales & Marketing.
E. Flight Insurance
Individual flight insurance is not reimbursable.
29
F. Denied Boarding Compensation
Airlines occasionally offer free tickets or cash allowances to
compensate individuals for delays or inconveniences due to overbooking, flight
cancellations, or changes of equipment. Agency Employees must not volunteer for
denied boarding compensation when on Company business and on Company time.
G. Lost Baggage
The airlines have the ultimate responsibility for retrieving and
compensating for lost baggage. Company will not reimburse Agency Employees for
personal items lost while traveling on business. Company encourages the
following steps to be taken to minimize losses:
- carry valuables on board the aircraft;
- carry important or confidential documents on board the
aircraft; and
- tag luggage with name, business address, and phone number
Losses not covered by the airlines should be pursued with Agency
insurance coverage or the Agency Employee's homeowner's or renter's insurance.
Company has no responsibility or liability for loss items
H. Bonus Award Programs
Agency Employees who participate in bonus award or frequent flyer
programs may retain for personal credit any bonus awards they receive from
business travel, as long as the Agency Employee's accommodations or reservations
are made in accordance with this policy. Fees required for participation are not
reimbursable as a business expense. Travelers cannot refuse an accommodation,
airline carrier, or other authorized vendor because of the loss of bonus credits
or program points.
III. Reimbursement of Travel/Business Expenses
In the course of business, certain expenses are incurred by the Agency
Employees which can be categorized as reimbursable. The determination of
reimbursable expenses relies partially on the tax deductibility of those
expenses, as specified in the IRS regulations. Company also realizes that the
nature and amount of travel and business related expenditures may vary with the
objectives of each assignment and surrounding circumstances. Managers are
responsible for clearly
30
communicating the travel and reimbursement policy to all Agency Employees and
how it is applied. The Agency is expected to be in full compliance with these
policies and will be held accountable for unauthorized policy deviations.
All travel and business expenses must be approved by Company before the
expense is incurred.
All expenses must be reported, supported and approved prior to
reimbursement, and receipts covering such expenses must be included with Agency
invoices.
A. Reimbursable expenses
The following business expenses are reimbursable:
1. Travel expenses
a. Air and Rail Travel
All arrangements must be made at the lowest
fare available. Ticket stubs or passenger
receipts (in the case of electronic
ticketing) and the itinerary are to be
attached to the Agency Invoice.
b. Limousine Service
A receipt must be included from the driver,
and this receipt, along with the itinerary
must be attached to the Agency Invoice.
c. Taxi and Airport Limo/Shuttle Service
The cost of taxis, limos or shuttles to or
from places of business, hotels, airports,
or railroad stations is reimbursable. Agency
Employees should use scheduled bus or
shuttle services to and from airports or
hotels, wherever possible.
d. Vehicle Rental
Vehicle rental expenses are reimbursable
when the vehicle is rented for business use.
Agency Employees should rent a compact car
unless:
31
- there are two or more Agency
Employees traveling together;
- they are escorting customers in the
vehicle; and/or
- they need a large trunk to carry
business material or exhibit items
The deciding factors for renting a vehicle
should be the location you are traveling to
or from, and the availability of public
transportation, not personal convenience or
anticipated personal use.
Agency Employees should adhere to Agency
policies on whether or not to accept
Collision Damage and Personal Accident
Insurance for vehicles rented for domestic
(or international) travel for business
purposes. Company will not reimburse for
collision damage and personal accident
insurance or waivers or any other type of
insurance or waivers associated with rental
vehicles.
Rental agreements and receipts must be
retained and attached to Agency invoice.
Vehicles should be fueled to capacity before
returning the rental vehicle to the return
station. Retain and submit all receipts for
gas or oil purchases. If the vehicle is not
fueled to capacity, an explanation as to why
should be included.
Express check out slips are not receipts,
however they will be accepted if they are
submitted with the original rental
agreement.
2. Lodging
Hotel expenses are reimbursable at a cost, which is
usual for the area being visited. A standard single room is
normally acceptable, however, deluxe accommodations may be
requested if the business need exists, (e.g., a suite if
interviewing or local management meetings). Any such upgrades
must be approved by Company in writing prior to booking.
A detailed hotel receipt must be attached to the
Agency invoice. The bill must be marked paid, show a zero
balance, or be accompanied
32
by a charge card receipt. All categories of charges (e.g.,
room rate and tax, phone, room service) must be itemized
separately on a daily basis.
33
3. Meals, Entertainment, and Other Living Expenses
a. Meals
Personal meals are defined as meal expenses
incurred by the Agency Employee when dining alone as
a result of a Company requested business trip or
business function. Meals are reimbursed according to
actual and reasonable cost. The cost of meals should
include tips and taxes. Receipts must be submitted
for any single expense of $25 or more. Charge card
receipts are preferred. Restaurant stubs are not
accepted. Meals must be itemized separately for
breakfast, lunch and dinner.
b. Business Meal Expenses
Business meals are defined as those meals
during which a specific Company business discussion
takes place. Agency will be reimbursed for business
meal expenses according to actual and reasonable
costs. Receipts are required for all business meals.
The documentation for business meals must include the
name(s) of the person(s) being entertained, their
business affiliation and title, and the purpose of
the business meeting.
c. Documentation and IRS Requirements
The IRS and Company require the following
documentation for meals and entertainment:
- an original receipt must be submitted with
the expense report;
- names of the individuals entertained, their
titles, and company affiliation;
- name and location of where the meal or event
took place;
- exact amount and date of the expense;
- specific business topic discussed; and
- in the case of entertainment events, the
time the discussion took place (i.e.,
before, during or after)
34
d. Gratuities
Reasonable tips are reimbursable as
determined by level of service and local custom. As a
general rule, employees should not tip more than they
would on a personal trip. All tips, other than those
for meals (e.g., skycap, bellman, or housekeeping)
should be reported separately on the expense report.
Lavish or unreasonable gratuities as
determined by Company will not be reimbursed.
e. Laundry and Valet Service
Company will not reimburse for any laundry
or valet service.
f. Telephone
Business related phone and fax charges are
reimbursable. This includes calls to home while
traveling on Company business. Good judgment should
dictate the need, duration and number of calls.
Company expects every individual to use good
financial judgment when deciding how the calls should
be made (e.g., credit card, cell phone, hotel or long
distance).
g. Other Reimbursable Expenses
Agency will be reimbursed for the following
miscellaneous expenses:
- air freight for Company business
purposes;
- direct business office expenses
(e.g., copies, faxes);
- overnight delivery of business
materials;
- parking when at a location other
than Agency site;
- seminar fees with prior company
approval
Agency will not be reimbursed for the
following expenses:
35
- airline club membership dues;
- baby-sitting;
- barbers, hairdressers, and any
other personal service;
- clothing;
- dry cleaning;
- charge card delinquency fees;
- commuting expenses between
employees' residence and place of
work, even if working overtime or
scheduled day off;
- country club dues;
- excess baggage charges (unless it
is business materials);
- expenses not supported by a voucher
or receipt without adequate
explanation;
- flight insurance;
- flowers, fruit baskets, cakes, etc.
to fellow employee or their
relative, when they are ill, have a
birthday, have a baby, death in
family, etc.;
- golf fees;
- gum, candy, cigarettes or
toiletries;
- health club facility fees, saunas,
massages;
- in flight telephone charges;
- loss or theft of personal property
or funds;
- lost baggage;
36
- magazines, books, newspapers;
- mini bar refreshments and/or
snacks;
- movies (including in flight and
hotel in house movies);
- no show charges for hotel or car
service;
- parking or traffic tickets;
- personal accident insurance;
- personal entertainment;
- pet care;
- post cards;
- rental car upgrades;
- shoeshine;
- souvenirs/personal gifts;
- travel companions' traveling costs
Agency overhead costs
h. Miscellaneous Expenses
Any miscellaneous expense not mentioned
above should be approved, prior to incurring
the expense, by the Company. A clear
explanation of the business purpose must be
attached to the receipt or the IRS will
disallow the deduction.
4. Expense Reporting
a. Timing and submission
Agency Employees should include expense reimbursement
reports with each invoice to Company for the expense.
37
b. Approval Process
Expense reports submitted to Company for
reimbursement will be reviewed (for reasonableness
and policy compliance).
All expense reports are subject to audit for such
things as:
- accuracy;
- approval signatures;
- business purpose;
- supporting documentation and receipts; and
- policy compliance
c. Documentation
All Agency or Agency Employee expenses must have the
following information in order to be reimbursed for
expenditures:
- business purpose;
- names of individuals present, their titles,
and Company name;
- name and location of where meal or event
took place;
- exact amount and date of each expense; and
- in the case of entertainment events, when
the business discussion took place
The following documentation must be supplied:
- air/rail - original passenger coupon plus
itinerary;
- hotel - hotel folio plus charge card
receipt;
38
- vehicle rental - vehicle rental agreement,
charge card receipt, or express check out
form;
- meals/entertainment - (expenses of $25 or
more) charge card receipt or cash register
receipt (no tear off stubs); and
- other expenses - (of $25 or more) original
charge card or cash register receipts.
Original receipts must be submitted whenever
possible. Photocopies will be accepted only with a
detailed explanation as to why the original is not
available.
IV. Other
A. Group and Meeting Travel
Any assemblage of 10 or more people, Agency Employee and/or
Company, to a common destination for a common purpose is
considered a group. Every effort should be made to negotiate
group discounts on such trips. This includes negotiating and
contracting for guest rooms, meeting space, audio visual
equipment, food functions, ground and air transportation,
discounts, commissions and extra amenities, as well as
auditing and processing all invoices.
V. Policy Deviations
Except where otherwise specified above, any deviations from this policy
must be reviewed and approved by the appropriate Company Vice President
or Marketing Director.
39
Schedule F
CONFIDENTIAL DISCLOSURE AGREEMENT
(Insert copy of CDA in final agreement)
40
CONFIDENTIAL DISCLOSURE AGREEMENT
This Confidential Disclosure Agreement (hereinafter "Agreement') is made this
23rd day of July, 2001 by and between Endeavor Pharmaceuticals, Inc., a Delaware
corporation, located at 127 Racine Drive, Wilmington, North Carolina
28403.(hereinafter "Endeavor"), and Accel Healthcare Communications, LLC., a
Delaware limited liability company located at 25 West 43rd Street, New York, NY
10036 (hereinafter "Accel").
WITNESSETH
WHEREAS, Endeavor proposes to disclose certain proprietary and
confidential information ("CONFIDENTIAL INFORMATION") to Accel as more fully
defined below;
WHEREAS, said CONFIDENTIAL INFORMATION is being disclosed for the sole
and limited purpose of Accel performing certain services for and on behalf of
Endeavor;
WHEREAS, Accel has agreed to keep said CONFIDENTIAL INFORMATION secret
and confidential during the term of this Agreement and to make no use of it
whatsoever except as expressly authorized by Endeavor in writing.
NOW THEREFORE, in consideration of the disclosure of CONFIDENTIAL
INFORMATION to be provided pursuant to this Agreement and in consideration of
the covenants set forth hereinafter, and for other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged, the
parties hereto do agree as follows;
1. CONFIDENTIAL INFORMATION shall mean information relating to,
without limitation, inventions, trade secrets, know-how, processes, methods of
use, methodologies, analytical procedures, clinical procedures, clinical
protocols, clinical results, compositions of matter, formulations, experimental
results, raw material sources, patent applications, business plans, financial
models, and/or marketing strategies whether written, electronic, graphic, oral,
or physical samples and specimens, furnished or disclosed by Endeavor directly
or indirectly to Accel with the exception only of the following:
a) information that is now in the public domain or subsequently
enters the public domain without fault on the part of Accel;
b) information that is presently known to Accel from its own
sources which Accel can demonstrate by written records; or
c) information Accel lawfully receives from any third party not
under any obligation to keep such information confidential.
2. Accel agrees not to use CONFIDENTIAL INFORMATION for any
purpose other than for Accel to perform certain services for and on behalf of
Endeavor.
3. Accel agrees that it will maintain in confidence all
CONFIDENTIAL INFORMATION. In this regard, Accel agrees to disclose CONFIDENTIAL
INFORMATION only to those of its officers and employees who are directly,
concerned with the use and evaluation of the CONFIDENTIAL INFORMATION for the
purpose specified above, and it shall take all necessary and reasonable
precautions to prevent such CONFIDENTIAL INFORMATION from being disclosed to an
unauthorized person, firm, or company. Prior to disclosing CONFIDENTIAL
INFORMATION to its officers and employees, Accel shall advise said officers and
employees of the confidential nature thereof, and shall take all necessary and
reasonable precautions to prevent the unauthorized disclosure of the
CONFIDENTIAL INFORMATION by such officers and employees, including requiring
each such recipient to execute an appropriate Confidential Disclosure Agreement
protecting Endeavor's Confidential Information.
4. Accel further acknowledges that any violation of the
provisions hereof may result in irreparable injury to Endeavor for which there
is no adequate remedy at law, and Accel agrees that, in the event of any breach
of the provisions hereof, Endeavor shall be entitled to injunctive relief in
addition to any other remedy at law or in equity which may be available to
Endeavor. The parties hereto also agree that any court proceeding arising out of
a breach of the provisions hereof shall be brought in New Hanover County, North
Carolina, and that the General Court of Justice, New Hanover County, North
Carolina, shall have jurisdiction over any proceedings arising out of a breach
of this Agreement.
5. The obligations of Accel set forth in this Agreement shall
continue for a period of seven (7) years from the date of the execution of this
Agreement.
6. This Agreement may only be changed by another written
agreement signed by both of the parties hereto.
7. This Agreement shall inure to the benefit of and be binding
upon the undersigned parties, their respective legal successors and assigns.
8. This Agreement shall be governed and construed in accordance
with the laws of the State of North Carolina, U.S.A.
9. This Agreement shall be executed in duplicate originals with
each party retaining one original for its records.
IN WITNESS WHEREOF, Endeavor and Accel have each caused this instrument
to be executed in its corporate name by a duly authorized officer.
ACCEL HEALTHCARE COMMUNICATIONS, LLC
By: /s/ Risa Bernstein
-----------------------------------
Risa Bernstein
Title: President
-----------------------------------
ENDEAVOR PHARMACEUTICALS, INC.
By: /s/ Kathleen Milligan
---------------------------
Kathleen Milligan
Vice President
INDEX
1. Agency Services
2. General Terms
3. Agency Compensation
4. Agency Reimbursement
5. Reimbursement Of Travel And Entertainment Costs
6. Changes Or Suspension Of Work
7. Additional Charges For Unscheduled Services
8. Temporary /Free-Lance Help
9. Term And Termination
10 Indemnification And Insurance
11. Authorized Personnel
12. Audit And Accounting
13. Assignment
14. Notices
15. Company Business Practices
16. Miscellaneous Provisions
Schedule A Scope of Work
Schedule B Agency Staffing Plan
Schedule C Company Authorized Employees
Schedule D NOT USED
Schedule E General Company Corporate Travel Guidelines
Schedule F Confidential Disclosure Agreement
41