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EXHIBIT 10.5
THE FIRST NATIONAL BANK OF BOSTON
PROPOSED AGREEMENT
TO SERVE
AS
DISTRIBUTION AGENT
FOR THE SPIN-OFF
OF
CARDIO TECH INTERNATIONAL
This Agreement sets forth the terms and conditions under which The First
National Bank of Boston ("Bank of Boston") will serve as Distribution Agent,
providing the services stated in Section C in accordance with the fees set forth
in Section B to Polymedica Industries (hereinafter referred to as Polymedica).
A. TERM
The term of this Agreement shall be for a period of ONE (1) YEAR,
commencing from the effective date of this Agreement, MAY 1, 1996.
B. *FEES FOR SPIN-OFF OF CARDIO TECH BY POLYMEDICA INDUSTRIES:
For the spin-off services as stated in Section C provided by Bank of Boston
under this Agreement, Polymedica will be charged as follows:
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$ 5,000.00 FLAT FEE
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C. SPIN-OFF SERVICES
Bank of Boston agrees to provide the following services to Cardio Tech in
accordance with the fees set forth in Section B hereinabove.
SERVICES COVERED:
1. Administrative coordination of all services related to the spin-off
2. Responding to all shareholder and broker telephone and written
inquiries on Cardio Tech's behalf
3. Designation of a specialized administrative/operational task force to
carry out our duties as Distribution Agent
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4. Preparation and/or review of all agreements and related documentation
5. Preparing and mailing of "broker split" letters regarding
denominational breakdowns
6. Coordination with the Banknote Company relating to the delivery of new
stock certificates
7. Performance and balancing of the spin-off calculation
8. Issuance and registration and mailing of stock certificates to include
up to two (2) additional enclosures
9. Affixing restrictive legends to appropriate stock certificates, as
instructed by Cardio Tech
10. Establishing the new Cardio Tech shareholder file
11. Posting of all certificate and account detail to the Cardio Tech file
12. Performing all file adjustments relating to the Cardio Tech name change
13. Preparing a spin-off journal detailing the transaction in hardcopy
14. Effecting the necessary sales resulting from fractional shares
15. Preparing and mailing checks to shareholders representing proceeds of
sales from fractional shares
D. ITEMS NOT COVERED
- Legal review fees ($500.00 minimum / $1,000.00 maximum), if referred
to outside counsel
- Services required by legislation or regulatory fiat which become
effective after the date of this Agreement shall not be a part of the
Services Covered and shall be billed by appraisal
- All out-of-pocket expenses such as telephone line charges, cost of
stock certificates, Letters of Transmittal, insurance, stationery,
excess material disposal, etc. will be billed as incurred.
- Funds to cover postage expenses in excess of $5,000 for shareholder
mailings must be received by Bank of Boston one business day prior to
the scheduled mailing date. Postage expenses less than $5,000 will be
billed as incurred.
- Overtime charges will be assessed in the event of late delivery of
material for mailings to shareholders unless the mail date is
rescheduled. Receipt of material for mailing to shareholders by Bank
of Boston's Mail Unit must be in accordance with Shareholder
Services' Schedule of Required Material Delivery Time Frames published
in November, 1990.
All services not specifically covered under this Agreement will be
billed in accordance with Bank of Boston's published Schedule of Fees,
or by appraisal as applicable.
E. PAYMENT FOR SERVICES
The Fees will be calculated and rendered and payable within thirty (30)
days after the effective date of this Agreement and thereafter on a monthly
basis. It is agreed that out-of-pocket expenses will be rendered and
payable on a monthly basis. Each billing period will, therefore, be of
one-month duration.
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F. CONFIDENTIALITY
The information contained in this Agreement is confidential and proprietary
in nature. By receiving this Agreement, Polymedica agrees that none of its
directors, officers, employees, or agents without the prior written consent
of Bank of Boston, will divulge, furnish or make accessible to any third
party, except as permitted by the next sentence, any part of this Agreement
or information in connection therewith which has been or may be made
available to it. In this connection, Polymedica agrees that it will limit
access to the Agreement and such information to only those officers or
employees with responsibilities for analyzing the Agreement and to such
independent consultants hired expressly for the purpose of assisting in
such analysis. In addition, Polymedica agrees that any persons to whom such
information is properly disclosed shall be informed of the confidential
nature of the Agreement and the information relating thereto, and shall be
directed to treat the same appropriately.
G. NON-ASSIGNABILITY
This Agreement, and the duties, obligations and services to be provided
herein, may not be assigned or otherwise transferred without the prior
written consent of Cardio Tech.
H. CONTRACT ACCEPTANCE
In witness whereof, the parties hereto have caused this Agreement to be
executed by their respective officers, hereunto duly agreed and authorized,
as of the effective date of this Agreement.
THE FIRST NATIONAL BANK OF BOSTON POLYMEDICA INDUSTRIES
By: By:
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Title: Title:
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Date: Date:
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