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EXHIBIT 10.1
CONFIDENTIAL TREATMENT REQUESTED: Certain portions of this document have been
omitted pursuant to a request for confidential treatment and, where applicable,
has been marked with an asterisk to denote where omissions have been made. The
confidential material has been filed separately with the Commission.
ASSET PURCHASE AGREEMENT
BETWEEN
MEDICAL DISTRIBUTION SOLUTIONS, INC.,
XXXXXXXX.XXX, INC.
AND
NEOFORMA LIFELINE, INC.
MARCH 31, 2001
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ASSET PURCHASE AGREEMENT
This Agreement entered into as of March 31, 2001 is by and among Medical
Distribution Solutions, Inc., a Georgia corporation ("MDSI"), Xxxxxxxx.xxx,
Inc., a Delaware corporation ("Neoforma"), and Neoforma LifeLine, Inc., a
Delaware corporation and wholly owned subsidiary of Neoforma ("LifeLine"). MDSI,
Neoforma and LifeLine are referred to collectively herein as the "Parties."
This Agreement contemplates a transaction in which MDSI will purchase
substantially all of the assets (and assume certain of the liabilities) of
LifeLine in return for cash and the MDSI Note.
Now, therefore, in consideration of the premises and the mutual promises
herein made, and in consideration of the representations, warranties, and
covenants herein contained, the Parties agree as follows.
1. Basic Transaction.
(a) Purchase and Sale of Acquired Assets. On and subject to the terms and
conditions of this Agreement, MDSI agrees to purchase from LifeLine and
Neoforma, and LifeLine and Neoforma agree to sell, transfer, convey, and deliver
to MDSI, all of the Acquired Assets at the Closing for the consideration
specified in this Section 1.
(b) Assumption of Liabilities. On and subject to the terms and conditions
of this Agreement, MDSI agrees to assume and become responsible for all of the
Assumed Liabilities at the Closing. MDSI will not assume or have any
responsibility, however, with respect to any other obligation or liability of
LifeLine or Neoforma not included within the definition of Assumed Liabilities.
(c) Purchase Price. At the Initial Closing, MDSI agrees to pay to Neoforma
$1.25 million (the "Purchase Price") by delivery of the following:
(i) cash in the amount of Cash on the Closing Date payable by wire
transfer or delivery of other immediately available funds; provided, that
in no event shall MDSI pay Neoforma an aggregate amount greater than
$500,000 in cash pursuant to this clause; the Acquired Assets will include
Cash in the amount of $650,000, of which MDSI will wire $500,000 to
Neoforma; and
(ii) its promissory note (the "MDSI Note") in the form of Exhibit A
attached hereto in the principal amount of $750,000.
(d) The Closings. The initial closing of the transactions contemplated by
this Agreement (the "Initial Closing") shall take place, except for the
assignment of LifeLine's telephone lease, the completion of the Disclosure
Schedule by Neoforma and the provision of Certificates of Good Standing by
Neoforma, on the second business day following the execution of this Agreement
(the "Initial Closing Date"). A subsequent closing ("Subsequent Closing") shall
occur on such date as the telephone lease has been assigned to MDSI, the
Disclosure Schedule is completed and Neoforma provides MDSI with Certificates of
Good Standing.
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(e) Deliveries at the Closing. At the Initial Closing, (i) LifeLine and
Neoforma, as applicable, will deliver to MDSI a signed original of the
Assignment and Assumption Agreement attached hereto as Exhibit B, Services
Agreement attached hereto as Exhibit C, Covenant Not to Compete Agreement
attached hereto as Exhibit E, Technology Transfer and Waiver Agreement, License
Assignment, Database List associated with Intellectual Property as defined in
Section 2(k); (ii) MDSI will deliver to LifeLine and Neoforma a signed original
of the Services Agreement, Assignment and Assumption Agreement, Promissory Note
and Covenant Not to Compete; and (iii) MDSI will deliver to Neoforma the
consideration specified in Section 1(c). At the Subsequent Closing, LifeLine and
Neoforma will deliver to MDSI assignments for the telephone lease, a completed
Disclosure Schedule and Certificates of Good Standing.
2. Representations and Warranties of LifeLine and Neoforma. LifeLine and
Neoforma represent and warrant, jointly and severally, to MDSI that the
statements contained in this Section 2 are correct and complete as of the date
of this Agreement and will be correct and complete as of the Closing Date (as
though made then and as though the Closing Date were substituted for the date of
this Agreement throughout this Section 2), except as set forth in the disclosure
schedule accompanying this Agreement and initialed by the Parties (the
"Disclosure Schedule"). The Disclosure Schedule will be arranged in paragraphs
corresponding to the lettered and numbered paragraphs contained in this Section
2.
(a) Organization. Each of LifeLine and Neoforma is a corporation duly
organized, validly existing, and in good standing under the laws of the
jurisdiction of Delaware. LifeLine is duly authorized to conduct business and is
in good standing under the laws of each jurisdiction where such qualification is
required, except where the lack of such qualification would not have a material
adverse effect on the financial condition of LifeLine. LifeLine has full
corporate power and authority to carry on the businesses in which it is engaged
and to own and use the properties owned and used by it.
(b) Authorization of Transaction. Each of LifeLine and Neoforma has full
power and authority (including full corporate power and authority) to execute
and deliver this Agreement and to perform its obligations hereunder. This
Agreement constitutes the valid and legally binding obligation of each of
LifeLine and Neoforma, enforceable in accordance with its terms and conditions.
(c) Noncontravention. Neither the execution and the delivery of this
Agreement, nor the consummation of the transactions contemplated hereby
(including the assignments and assumptions referred to in Section 1), will (i)
violate any constitution, statute, regulation, rule, injunction, judgment,
order, decree, ruling, charge, or other restriction of any government,
governmental agency, or court to which either of LifeLine or Neoforma is subject
or any provision of the charter or bylaws of either of LifeLine or Neoforma or
(ii) conflict with, result in a breach of, constitute a default under, result in
the acceleration of, create in any party the right to accelerate, terminate,
modify, or cancel, or require any notice under any agreement, contract, lease,
license, instrument, or other arrangement to which either of LifeLine or
Neoforma is a party or by which it is bound or to which any of the Acquired
Assets is subject (or result in the imposition of any Security Interest upon any
of the Acquired Assets), except where the violation, conflict, breach, default,
acceleration, termination, modification, cancellation, failure to give notice,
or Security Interest would not have a material adverse effect on the financial
condition of
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LifeLine or on the ability of the Parties to consummate the transactions
contemplated by this Agreement. Neither of LifeLine or Neoforma needs to give
any notice to, make any filing with, or obtain any authorization, consent, or
approval of any government or governmental agency in order for the Parties to
consummate the transactions contemplated by this Agreement (including the
assignments and assumptions referred to in Section 1), except where the failure
to give notice, to file, or to obtain any authorization, consent, or approval
would not have a material adverse effect on the financial condition of such
Party or on the ability of the Parties to consummate the transactions
contemplated by this Agreement.
(d) Brokers' Fees. Neither Neoforma nor LifeLine has any liability or
obligation to pay any fees or commissions to any broker, finder, or agent with
respect to the transactions contemplated by this Agreement for which MDSI could
become liable or obligated.
(e) Title. LifeLine has good title to, or a valid leasehold interest in,
the Acquired Assets, including but not limited to, all material tangible assets
used regularly in the conduct of LifeLine's business. Neoforma has good title to
all of the capital stock of LifeLine. All of the issued and outstanding shares
of capital stock of LifeLine have been duly authorized and are validly issued,
fully paid, and nonassessable.
(f) Financial Statements. Attached hereto as Exhibit D are the following
financial statements (collectively the "Financial Statements"): (i) unaudited
balance sheets and statements of income, as of and for LifeLine's fiscal year
ended December 31, 2000; and (ii) LifeLine's unaudited balance sheets and
statements of income, (the "Most Recent Financial Statements") as of and for the
month ended February 28, 2001 (the "Most Recent Fiscal Month End"). The
Financial Statements have been prepared in accordance with GAAP applied on a
consistent basis throughout the periods covered thereby and present fairly
LifeLine's financial condition as of such dates and LifeLine's results of
operations for such periods; provided, however, that the Most Recent Financial
Statements are subject to normal year-end adjustments and lack footnotes and
other presentation items. Neoforma maintains a separate Cash account for
LifeLine (into which Neoforma deposits all of the receipts of LifeLine).
(g) Events Subsequent to Most Recent Fiscal Month End. Since the Most
Recent Fiscal Month End, there has not been any material adverse change in
LifeLine's financial condition. Without limiting the generality of the
foregoing, since that date neither LifeLine nor Neoforma has engaged in any
practice, taken any action, or entered into any transaction outside the Ordinary
Course of LifeLine's business.
(h) Legal Compliance. To the knowledge of LifeLine and Neoforma, LifeLine
has complied with all applicable laws (including rules, regulations, codes,
plans, injunctions, judgments, orders, decrees, rulings, and charges thereunder)
of federal, state, local, and foreign governments (and all agencies thereof),
except where the failure to comply would not have a material adverse effect upon
the financial condition of LifeLine.
(i) Tax Matters.
(i) LifeLine has filed all Income Tax Returns that it was required to
file, and has paid all Income Taxes shown thereon as owing, except where
the failure to file
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Income Tax Returns or to pay Income Taxes would not have a material adverse
effect on the financial condition of LifeLine.
(ii) Section 2(i) of the Disclosure Schedule lists all Income Tax
Returns filed with respect to LifeLine for taxable periods ended on or
after March 17, 2000, indicates those Income Tax Returns that have been
audited, and indicates those Income Tax Returns that currently are the
subject of audit. LifeLine has delivered to MDSI correct and complete
copies of all federal Income Tax Returns, examination reports, and
statements of deficiencies assessed against or agreed to by LifeLine since
March 17, 2000.
(iii) Neither of LifeLine nor Neoforma has waived any statute of
limitations in respect of Income Taxes or agreed to any extension of time
with respect to an Income Tax assessment or deficiency.
(iv) Neither LifeLine nor Neoforma are parties to any Income Tax
allocation or sharing agreement between each other.
(v) LifeLine has not been a member of an Affiliated Group filing a
consolidated federal Income Tax Return (other than a group the common
parent of which was Neoforma).
(j) Real Property.
(i) Reserved.
(k) Intellectual Property. Section 2(k) of the Disclosure Schedule
identifies those Acquired Assets which constitute Intellectual Property, as
defined below. MDSI shall purchase as is and where is all right, title and
interest in, or has the right to use, all patent applications, patents,
trademark applications, trademarks, service marks, trade names, mask works,
copyright applications, copyrights, trade secrets, know-how, technology and
other intellectual property and proprietary rights (the "Intellectual Property")
that are material to or reasonably necessary to the conduct of its business as
presently conducted or proposed to be conducted. All such Intellectual Property
will be transferred by LifeLine and Neoforma at closing. Intellectual Property
does not include Fast Trak and Sales Analysis; in addition. Fast Trak and Sales
Analysis are not part of the Acquired Assets. Neither Neoforma nor LifeLine are
aware of any infringement of any Intellectual Property by any third party.
Section (k) of Disclosure Schedule lists all copyright, mask work and trademark
registrations, applications and claimed rights which are not registered and all
patent and patents application for Intellectual Property owned by LifeLine of
which LifeLine and Neoforma are aware Neither Neoforma nor LifeLine are aware of
any material loss, cancellation, termination or expiration of any such
registration or patent. To the knowledge of LifeLine and Neoforma, LifeLine is
not using any confidential information or trade secrets of any former employer
or any past or present employees. Except as set out in the Disclosure Schedule,
neither Neoforma nor LifeLine has granted any reseller, distributor, sales
representative, original equipment manufacturer, value added reseller,
distributor, or other third party any right to reproduce, manufacturer, sell,
license or distribute any of its products or services in any market segment or
geographic location.
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(l) Contracts. Section 2(l) of the Disclosure Schedule lists all written or
oral contracts and other agreements to which LifeLine is a party the performance
of which will involve consideration in excess of $10,000. LifeLine has delivered
to MDSI a correct and complete copy of each contract or other agreement listed
in Section 2(l) of the Disclosure Schedule (as amended to date), including all
such agreements with Neoforma.
(m) Powers of Attorney. To the knowledge of LifeLine and Neoforma, there
are no outstanding powers of attorney executed on behalf of or with respect to
LifeLine.
(n) Litigation. Section 2(n) of the Disclosure Schedule sets forth each
instance in which LifeLine, or Neoforma solely with respect to LifeLine, (i) is
subject to any outstanding injunction, judgment, order, decree, ruling, or
charge or (ii) is a party to any action, suit, proceeding, hearing, or
investigation of, in, or before any court or quasi-judicial or administrative
agency of any federal, state, local, or foreign jurisdiction.
(o) Employee Benefits.
(A) Reserved.
(p) Investment. LifeLine (i) understands that the MDSI Note has not been,
and will not be, registered under the Securities Act, or under any state
securities laws, and is being offered and sold in reliance upon federal and
state exemptions for transactions not involving any public offering, (ii) is
acquiring the MDSI Note solely for LifeLine's own account for investment
purposes, and not with a view to the distribution thereof, (iii) is
sophisticated investor with knowledge and experience in business and financial
matters, (iv) has received certain information concerning MDSI and has had the
opportunity to obtain additional information as desired in order to evaluate the
merits and the risks inherent in holding the MDSI Note, (v) is able to bear the
economic risk and lack of liquidity inherent in holding the MDSI Note, and (vi)
is an Accredited Investor.
(q) Disclaimer of other Representations and Warranties. Except as expressly
set forth in this Section 2, neither LifeLine nor Neoforma makes any
representations or warranties, express or implied, at law or in equity, in
respect of any of LifeLine's assets (including, without limitation, the Acquired
Assets), liabilities or operations, including, without limitation, with respect
to merchantability or fitness for any particular purpose, and any such other
representations or warranties are hereby expressly disclaimed, except that
LifeLine and Neoforma represent and warrant that the Acquired Assets, except for
the Intellectual Property, are in good operable condition. MDSI hereby
acknowledges and agrees that, except to the extent specifically set forth in
this Section 2, MDSI is purchasing the Acquired Assets on an "as-is, where-is"
basis. Without limiting the generality of the foregoing, neither LifeLine nor
Neoforma makes any representations or warranties regarding any assets other than
the Acquired Assets or any liabilities other than the Assumed Liabilities, and
none shall be implied at law or in equity.
(r) Title To Acquired Assets
Except as disclosed in Section 2(s) of the Disclosure Schedule and to
Neoforma's knowledge LifeLine has good and marketable title to the Acquired
Assets (including but not limited to those shown on the balance sheet as of the
Most Recent Fiscal Month End included in
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the Financial Statements), free and clear of all liens, charges or encumbrances
(other than (i) liens for taxes not yet due and payable, (ii) liens reflected on
the Financial Statements and (iii) liens which are not material in character,
amount or extent, and which do not materially detract from the value or
materially interfere with the use of the property subject thereto or affected
thereby. To Neoforma's knowledge, the machinery and equipment included in such
assets are in good condition and repair, normal wear and tear excepted, and all
leases of real or personal property to which LifeLine is a party are fully
effective and afford LifeLine peaceful and undisturbed possession of the subject
matter of the lease. To Neoforma's knowledge, LifeLine is not in violation of
any zoning, building, safety or environmental ordinance, regulation or
requirement or other law or regulation applicable to the operation of owned or
leased properties, and LifeLine has not received any notice of such violation
with which it has not complied or had waived. Notwithstanding the foregoing,
Neoforma and LifeLine represent and warrant that they have full right, title,
and interest in and to the Intellectual Property, which is free of any lien or
encumbrance of any kind.
(s) Absence of Certain Changes
Since March 17, 2000 and to the best knowledge of Neoforma, Neoforma and
LifeLine have carried on LifeLine's business in the ordinary course
substantially in accordance with the procedures and practices in effect on March
17, 2000, and except as disclosed in Section 2(s) of the Disclosure Schedule,
since March 17, 2000 and the best knowledge of Neoforma there has not been with
respect to Neoforma and LifeLine:
(a) any material change in the financial condition, properties,
assets (including the Acquired Assets), liabilities, business, results of
operations or prospects;
(b) any contingent liability incurred thereby as guarantor or
surety with respect to the obligations of others;
(c) any mortgage, encumbrance or lien placed on any of the assets
or properties thereof;
(d) any obligation or liability incurred thereby other than in
the ordinary course of business, which obligations or liabilities do not exceed
in the aggregate $50,000;
(e) any purchase, license, sale or other disposition, or any
agreement or other arrangement for the purchase, license, sale or other
disposition, of any of the properties, assets or goodwill thereof other than in
the ordinary course of business;
(f) any damage, destruction or loss, whether or not covered by
insurance;
(g) any declaration, setting aside or payment of any dividend on,
or the making of any other distribution in respect of, the capital stock of
LifeLine, any split, stock dividend, combination or recapitalization of the
capital stock of LifeLine, any direct or indirect redemption, purchase or other
acquisition of the capital stock of LifeLine,
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(h) any labor dispute or claim of unfair labor practices, any
change in the compensation payable or to become payable to any of its officers,
employees or agents (other than pursuant to existing agreements set out on
Section 2(s) of the Disclosure Schedule or, in the case of non-officers, in the
ordinary course of business consistent with past practice ("Ordinary Course")),
or any bonus payment or arrangement made to or with any of such officers,
employees or agents other than amounts paid pursuant to Employee Plans disclosed
in Section 2(s) of the Disclosure Schedule;
(i) any loss of key executive, management or development
personnel thereof,
(j) any payment or discharge of a lien or liability thereof,
which lien or liability was not either (i) shown on the balance sheet as of
December 31, 2000 included in the Financial Statements or (ii) incurred in the
Ordinary Course after December 31, 2000 as disclosed under Section 2.(s)(d)
above;
(k) any obligation or liability incurred thereby to any of its
officers, directors, shareholders or affiliates, or any loans or advances made
thereby to any of its officers, directors, shareholders or affiliates, except
normal compensation and expense allowances payable to officers;
(l) any loss on or prior to the date of this Agreement of one or
more material customers or such number of customers which together represent a
material amount of business or any indication that such a loss is, or losses
are, reasonably likely, other than in connection with completion of projects and
normal customer turnover in the Ordinary Course;
(m) any issuance or sale of any debt or equity securities
(including, but not limited to, stock) thereby or of any options or other rights
to acquire from LifeLine, directly or indirectly, any debt or equity securities
(including but not limited to stock) thereof;
(n) any written indication or assertion by the other party
thereto of problems with Neoforma and LifeLine's products or services or
performance under a contract, lease, transaction, commitment or other right or
obligation or its desire to so amend, relinquish, terminate or not renew any
such contract, lease, transaction, commitment or other right or obligation;
(o) to Neoforma's knowledge, any execution, amendment,
relinquishment, termination or non-renewal thereby of, any lease or any written
indication or assertion by the other party thereto of problems with Neoforma and
LifeLine's products or services or performance under such lease, or its desire
to so amend, relinquish, terminate or not renew any such lease;
(p) any agreement or arrangement made thereby to take any action
which, if taken prior to the date hereof, would have made any representation or
warranty of Neoforma and LifeLine set forth in this Agreement untrue or
incorrect as of the date when made; or
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(q) any deferral of the payment of any accounts payable outside
the Ordinary Course or in an amount which is material or any discount,
accommodation or other concession made outside the Ordinary Course in order to
accelerate or induce the collection of any receivable.
(t) Agreements and Commitments
Except as disclosed in Section 2(t) of the Disclosure Schedule, Neoforma or
LifeLine are not on the date of this Agreement a party or subject to any oral or
written executory agreement, obligation or commitment that is material to
LifeLine, its financial condition, business or prospects, including but not
limited to the following:
(a) Any contract, commitment, letter agreement, quotation or
purchase order providing for payments by or to LifeLine in an aggregate amount
of (i) $50,000 or more in the Ordinary Course or (ii) $15,000 or more not in the
Ordinary Course;
(b) Any material license agreement under which Neoforma or
LifeLine is licensor, or under which Neoforma or LifeLine is licensee (except
for standard "shrink wrap" licenses for off-the-shelf software products);
(c) Any material agreement by Neoforma or LifeLine to encumber,
transfer or sell rights in or with respect to any material item of LifeLine
Intellectual Property;
(d) Any agreement for the sale or lease of real or personal
property involving more than $15,000 per year;
(e) Any dealer, distributor, sales representative, original
equipment manufacturer, value added remarketer or other agreement for the
distribution of LifeLine's products;
(f) Any franchise agreement;
(g) Any stock redemption or purchase agreement;
(h) Any joint venture contract or arrangement or any other
agreement that involves a sharing of profits with other persons or the payment
of royalties to any other person other than MDSI;
(i) Any instrument evidencing indebtedness for borrowed money by
way of direct loan, sale of debt securities, purchase money obligation,
conditional sale, guarantee or otherwise, except for trade indebtedness or any
advance to any employee of Neoforma or LifeLine incurred or made in the Ordinary
Course, and except as disclosed in the Financial Statements;
(j) Any contract containing covenants purporting to limit
LifeLine's freedom to compete in any line of business, market or industry and/or
in any geographic area; or
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(k) Any contract or commitment for the employment of any officer,
employee or consultant of LifeLine or any other type of contract or
understanding with any officer, employee or consultant of LifeLine that is not
immediately terminable by LifeLine without cost or other liability.
Except as noted in Section 2(t) of the Disclosure Schedule, all items
referred to above are valid and in full force and effect. To Neoforma and
LifeLine's knowledge, no other party is in breach of or default under any
material term of any such agreement, obligation or commitment nor has such other
party threatened such a breach or default. Neoforma or LifeLine are not a party
to any contract or arrangement that they reasonably expect will have a material
adverse effect on or cause a material adverse change to the properties, assets,
material intellectual property rights, financial condition, operating results,
business or prospects of LifeLine. LifeLine has no liability for renegotiation
of government contracts or subcontracts which are material to LifeLine, its
financial condition, business or prospects.
(u) Employees
Except as disclosed in Section 2(u) of the Disclosure Schedule, Neoforma or
LifeLine have no employment contract or consulting agreement currently in effect
that is not terminable at will without penalty or payment of compensation by
Neoforma and LifeLine (other than agreements with the sole purpose of providing
for the confidentiality of proprietary information or assignment of inventions).
Neoforma and LifeLine (a) have never been and are not now subject to a
union organizing effort, (b) have never been and are not now subject to any
collective bargaining agreement with respect to any of its employees, (c) have
never been and are not now subject to any other material contract, written or
oral, with any trade or labor union, employees' association or similar
organization or (d) have no current labor disputes. Neoforma and LifeLine have
good labor relations, and have no knowledge of any facts indicating that the
consummation of the transactions provided for herein (other than any
contemplated reductions in force associated therewith) will have a material
adverse effect on LifeLine's labor relations, and have no knowledge that any of
LifeLine's key development or other employees intend to leave its employ.
Section 2(u) of the Disclosure Schedule contains a list of all employment
and consulting agreements, all severance agreements, pension, retirement,
disability, medical, dental or other health plans, life insurance or other death
benefit plans, profit sharing, deferred compensation agreements, stock, option,
bonus or other incentive plans, vacation, sick, holiday or other paid leave
plans, severance plans or other similar employee benefit plans maintained by
Neoforma and LifeLine or any trade or business which is treated as a single
employer with Neoforma and LifeLine within the meaning of Code Section 414(b),
(c), (m) or (o) (each an " ERISA Affiliate") (the "Employee Plans").
To the knowledge of Neoforma, no employee of LifeLine is in violation of
any term of any employment contract, patent or trade secret disclosure agreement
or non-competition agreement or any other contract or agreement, or any
restrictive covenant, relating to the right of any such employee to be employed
by LifeLine or to use trade secrets or proprietary information
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of others, and the employment of any employee of LifeLine does not subject
LifeLine to any material liability to any third party.
Except as disclosed in Section 2(u) of the Disclosure Schedule, LifeLine is
not a party to any (a) agreement with any employee of Neoforma or LifeLine (i)
the benefits of which are contingent, or the terms of which are materially
altered, upon the occurrence of a transaction involving Neoforma or LifeLine in
the nature of any of the transactions contemplated by this Agreement (ii)
providing any term of employment or compensation guarantee or (iii) providing
severance benefits or other benefits after the termination of employment of such
employee regardless of the reason for such termination of employment other than
as required by law, or (b) agreement or plan, including, without limitation, any
stock option plan, stock appreciation rights plan or stock purchase plan, any of
the benefits of which will be materially increased, or the vesting of benefits
of which will be materially accelerated, by the occurrence of any of the
transactions contemplated by this Agreement. Neoforma or LifeLine are not
obligated to make any parachute payment, as defined in Section 28OG(b)(2) of the
Code, nor will any parachute payment be deemed to have occurred, as a result of
the transactions contemplated by this Agreement.
A list of all employees, officers and consultants of LifeLine and their
current base compensation and benefits as of the date of this Agreement is
disclosed on Section 2(u) of the Disclosure Schedule.
All contributions due from Neoforma and LifeLine with respect to any of the
Employee Plans have been made or accrued on the Financial Statements.
(v) Disclosure
This Agreement, its exhibits and schedules, any of the certificates or
documents to be delivered by Neoforma and LifeLine to MDSI under this Agreement,
taken together, do not contain any untrue statement of a material fact.
(w) Books and Records
To the best knowledge of Neoforma, the books, records and accounts of
LifeLine (a) are in all material respects true and complete, (b) have been
maintained in accordance with reasonable business practices on a basis
consistent with prior years, (c) are stated in reasonable detail and accurately
and fairly reflect the transactions and dispositions of the assets of LifeLine
and (d) accurately and fairly reflect the basis for the Financial Statements.
(x) Insurance
LifeLine maintains the insurance coverage disclosed on Section 2(x) of the
Disclosure Schedule which it believes to be reasonably prudent for similarly
sized and similarly situated business. Section 2(u) sets forth all claims made
under such insurance policies since March 17, 2000 and the premiums that apply
with respect to such insurance policies as of the date of this Agreement.
Neoforma and LifeLine has not changed insurance carriers since March 17, 2000.
(y) Warranties, Guaranties and Indemnities
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Except as disclosed in Section 2(y) of the Disclosure Schedule, or in the
agreements or contract listed herein, and to the knowledge of Neoforma, LifeLine
has not provided to its customers (i) any warranties, guarantees or indemnities
regarding the services and products it provides to such customers; or (ii)
rights to obtain refunds with respect to such services except for rights that
are customary in the industry and do not expose LifeLine to any material risk of
liability.
(z) Environmental
To the knowledge of Neoforma, during the period that LifeLine has leased or
owned its properties or leased, owned or operated any facilities, there have
been no disposals, releases or threatened releases of Hazardous Materials (as
defined below) on, from or under any such properties or facilities that would
expose LifeLine to any material legal liability or otherwise have a Material
Adverse Effect. Neither Neoforma nor LifeLine have any knowledge of any
presence, disposals, releases or threatened releases of Hazardous Materials on,
from or under any of such properties or facilities, which may have occurred
prior to LifeLine having taken possession of any of such properties or
facilities which might reasonably be expected to have a Material Adverse Effect.
For purposes of this Agreement, the terms "disposal," "release", and threatened
release" have the definitions assigned thereto by the Comprehensive
Environmental Response, Compensation and Liability Act of 1980, 42 U.S.C.
Section 9601 et seq., as amended (CERCLA). For the purposes of this Section
2.21, Hazardous Materials mean any hazardous or toxic substance, material or
waste which is or becomes prior to the Closing Date, regulated under, or defined
as a hazardous substance", pollutant", "contaminant", "toxic chemical",
"hazardous material", "toxic substance or "hazardous chemical" under (i) CERCLA;
(ii) the Emergency Planning and Community Right-to-Know Act, 42 U.S.C. Section
11001 et seq.; (iii) the Hazardous Materials Transportation Act, 49 U.S.C.
Section 1801, et seq.; (iv) the Toxic Substances Control Act, 15 U.S.C., Section
2601 et seq.; (v) the Occupational Safety and Health Act of 1970, 29 U.S.C.
Section 651 et seq.; (vi) regulations promulgated under any of the above
statutes; or (vii) any other applicable federal, state or local statute,
ordinance, rule or regulation that has a scope or purpose similar to those
identified above.
To the knowledge of Neoforma, none of the properties or facilities
currently leased or owned by LifeLine or any properties or facilities previoNFLy
leased or owned by LifeLine is in violation in any material respect of any
federal, state or local law, ordinance, regulation or order relating to
industrial hygiene or to the environmental conditions on, under or about such
properties or facilities, including, but not limited to, soil and ground water
condition.
To the knowledge of Neoforma, during LifeLine's occupancy of any properties
or facilities owned or leased at any time by LifeLine, neither LifeLine, nor to
LifeLine's knowledge, any third party, has used, generated manufactured,
released or stored on, under or about such properties and facilities or
transported to or from such properties and facilities any Hazardous Materials
that would expose LifeLine to any material legal liability or otherwise have a
material adverse effect.
To the knowledge of Neoforma, during the time that LifeLine has owned or
leased the properties and facilities currently occupied by it or any properties
and facilities previously occupied by LifeLine, there has been no material
litigation, proceeding or administrative action brought or threatened against
LifeLine, or any material settlement reached
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by LifeLine with, any party or parties alleging the presence, disposal, release
or threatened release of any Hazardous Materials on, from or under any of such
properties or facilities.
To the knowledge of Neoforma, during LifeLine's occupancy of any properties
or facilities owned or leased at any time by LifeLine, to the best knowledge of
LifeLine, no Hazardous Materials have been transported from such premises to any
site or facility now listed or proposed for listing on the National Priorities
List, at 40 C.F.R. Part 300, or any list with a similar scope or purpose
published by any state authority.
(aa) Government Contracts
To the knowledge of Neoforma, there has been no act or omission that
relates to the marketing, licensing or selling to any Government Contract Party
(as defined below) of any of LifeLine technical data, computer software,
products and services and that has led to or is reasonably likely to lead to,
either before or after the Closing Date, any material adverse effect to any of
LifeLine's rights in and to its technical data, computer software, products and
services. There is currently no dispute between LifeLine and any Government
Contract Party. For purposes of this Section 2(aa), the term "Government
Contract Party means any independent or executive agency, division, subdivision,
audit group or procuring office of the federal, state, county, local or
municipal government, including any prime contractor of the federal government
and any higher level subcontractor of a prime contractor of the federal
government, and including any employees or agents thereof, in each case acting
in such capacity.
(bb) Customer Relationships
To the knowledge of Neoforma, LifeLine has good commercial working
relationships with its customers. Except as disclosed in Section 2(bb) of the
Disclosure Schedule and to the knowledge of Neoforma, no customer accounting for
more than 10% of LifeLine's revenues in fiscal 2000 (a "Material Customer ")
has, from March 17, 2000 to the date of this Agreement, canceled or otherwise
terminated its relationship with LifeLine, decreased or limited materially the
amount of product or services ordered from LifeLine, or threatened to take any
such action other than in the Ordinary Course upon completion of customer
projects.
(cc) Product and Service Quality
To the knowledge of Neoforma, all products manufactured, sold, licensed,
leased or delivered by LifeLine and all services provided by LifeLine, to
customers on or prior to the Closing Date conform to applicable contractual
commitments, express warranties, product specifications and quality standards in
all material respects, and LifeLine has no material liability (and there is no
basis for any present or future action, suit, proceeding, hearing,
investigation, charge, complaint, claim or demand against LifeLine giving rise
to any liability) for replacement or repair thereof or other damages in
connection therewith. All material complaints received since the end of 1999
from customers regarding LifeLine's services or any information supplied by or
published by LifeLine are summarized in Section 2(cc) of the Disclosure
Schedule.
3. Representations and Warranties of MDSI. MDSI represents and warrants to
LifeLine and Neoforma that the statements contained in this Section 3 are
correct and complete as of the date of this Agreement and will be correct and
complete as of the Closing Date (as though made then and as though the Closing
Date were substituted for the date of this Agreement
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throughout this Section 3), except as set forth in the Disclosure Schedule. The
Disclosure Schedule will be arranged in paragraphs corresponding to the lettered
and numbered paragraphs contained in this Section 3.
(a) Organization of MDSI. MDSI is a corporation duly organized, validly
existing, and in good standing under the laws of Georgia.
(b) Authorization of Transaction. MDSI has full power and authority
(including full corporate power and authority) to execute and deliver this
Agreement and to perform its obligations hereunder. This Agreement constitutes
the valid and legally binding obligation of MDSI, enforceable in accordance with
its terms and conditions.
(c) Noncontravention. Neither the execution and the delivery of this
Agreement, nor the consummation of the transactions contemplated hereby
(including the assignments and assumptions referred to in Section 1), will (i)
violate any constitution, statute, regulation, rule, injunction, judgment,
order, decree, ruling, charge, or other restriction of any government,
governmental agency, or court to which MDSI is subject or any provision of its
charter or bylaws or (ii) conflict with, result in a breach of, constitute a
default under, result in the acceleration of, create in any party the right to
accelerate, terminate, modify, or cancel, or require any notice under any
agreement, contract, lease, license, instrument, or other arrangement to which
MDSI is a party or by which it is bound or to which any of its assets is
subject. MDSI does not need to give any notice to, make any filing with, or
obtain any authorization, consent, or approval of any government or governmental
agency in order for the Parties to consummate the transactions contemplated by
this Agreement (including the assignments and assumptions referred to in Section
1).
(d) Brokers' Fees. MDSI has no liability or obligation to pay any fees or
commissions to any broker, finder, or agent with respect to the transactions
contemplated by this Agreement for which Neoforma or LifeLine could become
liable or obligated.
4. Pre-Closing Covenants. The Parties agree as follows with respect to the
period between the execution of this Agreement and the Closing.
(a) General. Each of the Parties will use its reasonable best efforts to
take all action and to do all things necessary, proper or advisable in order to
consummate and make effective the transactions contemplated by this Agreement
(including satisfaction, but not waiver, of the closing conditions set forth in
Section 6).
(b) Notices and Consents. LifeLine will give (and Neoforma will cause
LifeLine to give) any notices to third parties, and LifeLine will use its
reasonable best efforts (and Neoforma will cause LifeLine to use its reasonable
best efforts) to obtain any third party consents, that MDSI reasonably may
request in connection with the matters referred to in Section 2(c). Each of the
Parties will give any notices to, make any filings with, and use its reasonable
best efforts to obtain any authorizations, consents, and approvals of
governments and governmental agencies in connection with the matters referred to
in Section 2(c) and 3(c).
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(c) Operation of Business. LifeLine will not, and Neoforma will not cause
or permit LifeLine to engage in any practice, take any action, or enter into any
transaction outside the Ordinary Course of Business.
(d) Full Access. LifeLine will permit representatives of MDSI to have full
access at all reasonable times, and in a manner so as not to interfere with the
normal business operations of LifeLine, to all premises, properties, personnel,
books, records (including tax records), contracts and documents of or pertaining
to LifeLine. MDSI will treat and hold as such any Confidential Information it
receives from either of Neoforma or LifeLine in the course of the reviews
contemplated by this Section 4(d), will not use any of the Confidential
Information except in connection with this Agreement, and, if this Agreement is
terminated for any reason whatsoever, will return to LifeLine all tangible
embodiments (and all copies) of the Confidential Information which are in its
possession.
(e) Notice of Developments.
(i) Neoforma or LifeLine may elect at any time to notify MDSI of any
development causing a breach of any of its representations and warranties
in Sections 2(f)-(o). Unless MDSI has the right to terminate this Agreement
pursuant to Section 8(a)(ii) by reason of the development and exercises
that right within the period of ten (10) business days referred to in
Section 8(a)(ii), the written notice pursuant to this Section 4(e)(i) will
be deemed to have amended the Disclosure Schedule, to have qualified the
representations and warranties contained in Section 2, and to have cured
any misrepresentation or breach of warranty that otherwise might have
existed hereunder by reason of the development.
(ii) Each Party will give prompt written notice to the other Party of
any material adverse development causing a breach of any of its own
representations and warranties in Sections 2(a)-(e) and 3. No disclosure by
any Party pursuant to this Section 4(e)(ii), however, shall be deemed to
amend or supplement the Disclosure Schedule or to prevent or cure any
misrepresentation or breach of warranty.
(f) Exclusivity. Neoforma will not (and will not cause or permit LifeLine
to) solicit, initiate, or encourage the submission of any proposal or offer from
any Person relating to the acquisition of all or substantially all of the
capital stock or assets of LifeLine (including any acquisition structured as a
merger, consolidation, or share exchange).
5. Additional Agreements and Post-Closing Covenants. The Parties agree as
follows with respect to the period following the Closing.
(a) General. In case at any time after the Closing any further action is
necessary or desirable to carry out the purposes of this Agreement, each of the
Parties will take such further action (including the execution and delivery of
such further instruments and documents) as the other Party reasonably may
request, all the sole cost and expense of the requesting Party (unless the
requesting Party is entitled to indemnification therefor under Section 7).
(b) Litigation Support. In the event and for so long as any Party actively
is contesting or defending against any third party action, suit, proceeding,
hearing, investigation, charge,
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complaint, claim, or demand in connection with (i) any transaction contemplated
under this Agreement or (ii) any fact, situation, circumstance, status,
condition, activity, practice, plan, occurrence, event, incident, action,
failure to act, or transaction on or prior to the Closing Date involving
LifeLine, the other Party will cooperate with the contesting or defending Party
and its counsel in the contest or defense, make available its personnel, and
provide such testimony and access to its books and records as shall be necessary
in connection with the contest or defense, all at the sole cost and expense of
the contesting or defending Party (unless the contesting or defending Party is
entitled to indemnification therefor under Section 7).
(c) Transition. Neither Neoforma nor LifeLine will not take any action that
is designed or intended to have the effect of discouraging any lessor, licensor,
customer, supplier, or other business associate of LifeLine from maintaining the
same business relationships with MDSI after the Closing as it maintained with
LifeLine prior to the Closing.
(d) Covenant Not to Compete. At Closing, both Neoforma and LifeLine will
enter into the Covenant Not to Compete attached hereto as Exhibit E, wherein
both Neoforma and LifeLine will be banned from competing against MDSI in select
markets for five (5) years from Closing. The parties agree that separate
consideration was or will be given for this agreement.
(e) MDSI Note. MDSI Note will be imprinted with a legend substantially in
the following form:
"This Note was originally issued on March 31, 2001, and has not been
registered under the Securities Act of 1933, as amended."
(f) Employment Matters.
(i) Neoforma and LifeLine will, and Neoforma will cause LifeLine to,
terminate all of their employees and agents engaged in LifeLine's business
as of the Closing Date except for those employees or agents set forth in
the Disclosure Schedule (the "Retained Employees"). Except for the Retained
Employees, MDSI shall either hire all of the persons employed by Neoforma
or LifeLine engaged in LifeLine's Business as of the Closing Date or
reimburse LifeLine for all accrued vacation and severance payments made to
such employees not hired by MDSI who are not Retained Employees. Employees
hired by MDSI as permanent employees effective on or after the Closing Date
shall be referred to herein as a "Transferred Employee".
(ii) MDSI shall assume the liability for accrued vacations of
Transferred Employees as of the Closing Date, including, without
limitation, any liability for vacations earned, vested and awarded to
Transferred Employees prior to the Closing Date and unused as of the
Closing Date.
6. Conditions to Obligation to Close.
(a) Conditions to Obligation of MDSI. The obligation of MDSI to consummate
the transactions to be performed by it in connection with the Closing is subject
to satisfaction of the following conditions:
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(i) the representations and warranties set forth in Section 2 shall be
true and correct in all material respects at and as of the Closing Date;
(ii) Neoforma and LifeLine shall have performed and complied with all
of their covenants hereunder in all material respects through the Closing;
(iii) there shall not be any injunction, judgment, order, decree,
ruling, or charge in effect preventing consummation of any of the
transactions contemplated by this Agreement;
(iv) the relevant parties shall have entered into all agreements
specified herein, including but not limited to the Services Agreement and
the Covenant Not to Compete as set forth in the Exhibits attached hereto;
and
(v) all actions to be taken by Neoforma and LifeLine in connection
with consummation of the transactions contemplated hereby and all
certificates, opinions, instruments, and other documents required to effect
the transactions contemplated hereby will be reasonably satisfactory in
form and substance to MDSI.
(vii) There shall not have been any material adverse change in the
financial condition of Neoforma, LifeLine, or the Acquired Assets except
for changes in accord with the Ordinary Course of LifeLine's business;
(viii) There shall be no order, decree, or ruling by any court or
governmental agency in effect that would prohibit or render illegal the
transactions provided for in this Agreement.
(ix) There shall have been obtained at or prior to the Closing Date
such permits or authorizations, and there shall have been taken such other
action, as may be required to consummate the transaction contemplated
herein by any regulatory authority having jurisdiction over the parties and
the actions herein proposed to be taken.
(x) MDSI shall have received all written consents, assignments,
waivers, authorizations or other certificates necessary to provide for the
continuation in full force and effect of any and all contracts and leases
of LifeLine.
(xi) No litigation or proceeding shall be threatened or pending which
will have the probable effect of enjoining or preventing the consummation
of any of the transactions provided for in this Agreement or which could
reasonably be expected to have a material adverse effect on Neoforma or
LifeLine.
(xii) Each of Neoforma and LifeLine shall produce (a) a certificate of
good standing from the State of Delaware;
(xiii) Any resignations of officers or directors of LifeLine requested
by MDSI shall have been tendered to MDSI in writing.
MDSI may waive any condition specified in this Section 6(a) if it executes
a writing so stating at or prior to the Closing.
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(b) Conditions to Obligation of Neoforma and LifeLine. The obligation of
each of Neoforma and LifeLine to consummate the transactions to be performed by
it in connection with the Closing is subject to satisfaction of the following
conditions:
(i) the representations and warranties set forth in Section 3 shall be
true and correct in all material respects at and as of the Closing Date;
(ii) MDSI shall have performed and complied with all of its covenants
hereunder in all material respects through the Closing;
(iii) there shall not be any injunction, judgment, order, decree,
ruling, or charge in effect preventing consummation of any of the
transactions contemplated by this Agreement;
(iv) the relevant parties shall have entered into all agreements
specified herein, including but not limited to the Services Agreement,
Promissory Note, Assignment and Assumption Agreement and the Covenant Not
to Compete as set forth in the Exhibits attached hereto, and the same shall
be in full force and effect; and
(v) all actions to be taken by MDSI in connection with consummation of
the transactions contemplated hereby and all certificates, opinions,
instruments, and other documents required to effect the transactions
contemplated hereby will be reasonably satisfactory in form and substance
to Neoforma and LifeLine.
Neoforma and LifeLine may waive any condition specified in this Section
6(b) if they execute a writing so stating at or prior to the Closing.
7. Remedies for Breaches of this Agreement; Indemnification.
(a) Survival of Representations and Warranties. All of the representations
and warranties of the Parties contained in this Agreement shall survive the
Closing and continue in full force and effect for a period of two years from the
Closing Date.
(b) Indemnification Provisions for Benefit of MDSI.
(i) In the event either Neoforma or LifeLine breaches any of their
representations, warranties, and covenants contained in this Agreement,
and, if there is an applicable survival period pursuant to Section 7(a),
provided that MDSI makes a written claim for indemnification against
Neoforma or LifeLine, as applicable, pursuant to Section 9(g) within such
survival period, then Neoforma and LifeLine jointly and severally agree to
indemnify, defend and hold MDSI harmless from and against the entirety of
any Adverse Consequences MDSI shall suffer through and after the date of
the claim for indemnification (but excluding any Adverse Consequences MDSI
shall suffer after the end of any applicable survival period) caused
proximately by the breach.
(ii) Neoforma and LifeLine jointly and severally agree to indemnify,
defend and hold MDSI harmless from and against the entirety of any Adverse
Consequences such Party shall suffer caused proximately by (A) any
liability of LifeLine which is not
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an Assumed Liability, and (B) the operation of LifeLine's business by
Neoforma and/or LifeLine and the ownership, operation or use of the
Acquired Assets prior to the Closing Date.
(c) Indemnification Provisions for Benefit of Neoforma.
(i) In the event MDSI breaches any of its representations, warranties,
and covenants contained in this Agreement and provided that either Neoforma
or LifeLine makes a written claim for indemnification against MDSI pursuant
to Section 9(g) within such survival period, then MDSI agrees to indemnify
such Party from and against the entirety of any Adverse Consequences such
Party shall suffer through and after the date of the claim for
indemnification (but excluding any Adverse Consequences such Party shall
suffer after the end of any applicable survival period) caused proximately
by the breach.
(ii) MDSI agrees to indemnify Neoforma and LifeLine from and against
the entirety of any Adverse Consequences such Party shall suffer caused
proximately by (A) any liability of LifeLine which is an Assumed Liability
or (B) the operation of LifeLine's business by MDSI or MDSI's ownership,
operation or use of the Acquired Assets on or after the Closing Date.
(d) Matters Involving Third Parties.
(i) If any third party shall notify any Party (the "Indemnified
Party") with respect to any matter (a "Third Party Claim") which may give
rise to a claim for indemnification against the other Party (the
"Indemnifying Party") under this Section 7, then the Indemnified Party
shall promptly (and in any event within five (5) business days after
receiving notice of the Third Party Claim) notify the Indemnifying Party
thereof in writing.
(ii) The Indemnifying Party will have the right at any time to assume
and thereafter conduct the defense of the Third Party Claim with counsel of
its choice reasonably satisfactory to the Indemnified Party; provided,
however, that the Indemnifying Party will not consent to the entry of any
judgment or enter into any settlement with respect to the Third Party Claim
without the prior written consent of the Indemnified Party (not to be
withheld unreasonably) unless the judgment or proposed settlement involves
only the payment of money damages and does not impose an injunction or
other equitable relief upon the Indemnified Party.
(iii) Unless and until the Indemnifying Party assumes the defense of
the Third Party Claim as provided in Section 7(d)(ii), however, the
Indemnified Party may defend against the Third Party Claim in any manner it
reasonably may deem appropriate.
(iv) In no event will the Indemnified Party consent to the entry of
any judgment or enter into any settlement with respect to the Third Party
Claim without the prior written consent of the Indemnifying Party (not to
be withheld unreasonably).
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(e) Determination of Adverse Consequences. The Parties shall make
appropriate adjustments for tax benefits in determining Adverse Consequences for
purposes of this Section 7. All indemnification payments under this Section 7
shall be deemed adjustments to the Purchase Price.
(f) Other Indemnification Provisions. The indemnification provisions in
this Section 7 are in addition to, and not in derogation of, any statutory,
equitable, or common law remedy any Party may have for breach of representation,
warranty, or covenant.
8. Termination.
(a) Termination of Agreement. Certain of the Parties may terminate this
Agreement as provided below:
(i) the Parties may terminate this Agreement by mutual written consent
at any time prior to the Closing;
(ii) MDSI may terminate this Agreement by giving written notice to
Neoforma and LifeLine at any time prior to the Closing in the event (A)
either Neoforma or LifeLine has within the then previous ten (10) business
days given MDSI any notice pursuant to Section 4(e)(i) and (B) the
development that is the subject of the notice has had a material adverse
effect upon the financial condition of LifeLine;
(iii) MDSI may terminate this Agreement by giving written notice to
Neoforma or LifeLine at any time prior to the Closing if either Neoforma or
LifeLine has breached any material representation, warranty, or covenant
contained in this Agreement (in any material respect, MDSI has notified
Neoforma and LifeLine of the breach, and the breach has continued without
cure for a period of thirty (30) days after the notice of breach; and
(iv) either Neoforma or LifeLine may terminate this Agreement by
giving written notice to MDSI at any time prior to the Closing if MDSI has
breached any material representation, warranty, or covenant contained in
this Agreement in any material respect, such Party has notified MDSI of the
breach, and the breach has continued without cure for a period of thirty
(30) days after the notice of breach.
(b) Effect of Termination. If any Party terminates this Agreement pursuant
to Section 8(a), all rights and obligations of the Parties hereunder shall
terminate without any liability of any Party to the other Party (except for any
liability of any Party then in breach); provided, however, that the
confidentiality provisions contained in Section 4(d) shall survive termination.
9. Miscellaneous.
(a) Press Releases and Public Announcements. No Party shall issue any press
release or make any public announcement relating to the subject matter of this
Agreement without the prior written approval of the other Party; provided,
however, that any Party may make any public disclosure it believes in good faith
is required by applicable law or any listing or trading
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agreement concerning its publicly traded securities (in which case the
disclosing Party will use its reasonable best efforts to advise the other Party
prior to making the disclosure).
(b) No Third-Party Beneficiaries. This Agreement shall not confer any
rights or remedies upon any Person other than the Parties and their respective
successors and permitted assigns.
(c) Entire Agreement. This Agreement (including the documents referred to
herein) constitutes the entire agreement between the Parties and supersedes any
prior understandings, agreements, or representations by or between the Parties,
written or oral, to the extent they related in any way to the subject matter
hereof.
(d) Succession and Assignment. This Agreement shall be binding upon and
inure to the benefit of the Parties named herein and their respective successors
and permitted assigns. No Party may assign either this Agreement or any of its
rights, interests, or obligations hereunder without the prior written approval
of the other Party ; provided, however, that MDSI may (i) assign any or all of
its rights and interests hereunder to one or more of its Affiliates and (ii)
designate one or more of its Affiliates to perform its obligations hereunder (in
any or all of which cases MDSI nonetheless shall remain responsible for the
performance of all of its obligations hereunder).
(e) Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original but all of which
together will constitute one and the same instrument.
(f) Headings. The section headings contained in this Agreement are inserted
for convenience only and shall not affect in any way the meaning or
interpretation of this Agreement.
(g) Notices. All notices, requests, demands, claims, and other
communications hereunder will be in writing. Any notice, request, demand, claim,
or other communication hereunder shall be deemed duly given if (and then two
business days after) it is sent by registered, certified or electronic mail,
return receipt requested, postage prepaid (if applicable), and addressed to the
intended recipient as set forth below:
If to Neoforma or LifeLine:
Xxxxxxxx.xxx, Inc.
0000 Xxxxxx Xxxx
Xxx Xxxx, Xxxxxxxxxx 00000
Telephone: 000-000-0000
Fax: 000-000-0000
Attention: Xxxxxxx X. Xxxxxxxx, General Counsel
E-mail: xxxxx.xxxxxxxx@xxxxxxxx.xxx
If to MDSI:
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Medical Distribution Solutions, Inc.
0000 Xxxxx Xxxxxx Xxxxxxxxx, Xxxxx 0000
Xxxxxxxx, Xxxxxxx 00000
Telephone: 000.000.0000
Fax: 000.000.0000
Attention: Xxxxx Xxxxx, President
E-mail: xxxxxx@xxxx.xxx
with a copy to:
Brennan, Steil, Basting and XxxXxxxxxx, S.C.
Xxx Xxxx Xxxxxxxxx Xxxxxx (53545)
X.X. Xxx 0000
Xxxxxxxxxx, XX 00000-0000
Telephone: 000.000.0000
Fax: 000.000.0000
Attention: Xxxxxxxx X. Xxxxxxx
E-mail: xxxxxxxx@xxxxxxx.xxx
with a copy to:
The Xxxxxx Xxxxxxx Group, LLC
Xxx Xxxxxx Xxxxx
Xxxxxxxxxx, XX 00000
Telephone: 000.000.0000
Fax: 000.000.0000
Attention: Xxxxxx X. Xxxxxxx
E-mail: xxxxxx@xxxxxxxxxxxx.xxx with a copy to:
Any Party may send any notice, request, demand, claim, or other
communication hereunder to the intended recipient at the address set forth above
using any other means (including personal delivery, expedited courier, messenger
service, telecopy, telex or ordinary mail), but no such notice, request, demand,
claim, or other communication shall be deemed to have been duly given unless and
until it actually is received by the intended recipient. Any Party may change
the address to which notices, requests, demands, claims, and other
communications hereunder are to be delivered by giving the other Party notice in
the manner herein set forth.
(h) Governing Law. This Agreement shall be governed by and construed in
accordance with the domestic laws of the State of Delaware without giving effect
to any choice or conflict of law provision or rule (whether of the State of
Delaware or any other jurisdiction) that would cause the application of the laws
of any jurisdiction other than the State of Delaware.
(i) Amendments and Waivers. No amendment of any provision of this Agreement
shall be valid unless the same shall be in writing and signed by the Parties. No
waiver by any Party of any default, misrepresentation, or breach of warranty or
covenant hereunder, whether intentional or not, shall be deemed to extend to any
prior or subsequent default,
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misrepresentation, or breach of warranty or covenant hereunder or affect in any
way any rights arising by virtue of any prior or subsequent such occurrence.
(j) Severability. Any term or provision of this Agreement that is invalid
or unenforceable in any situation in any jurisdiction shall not affect the
validity or enforceability of the remaining terms and provisions hereof or the
validity or enforceability of the offending term or provision in any other
situation or in any other jurisdiction.
(k) Expenses. Each Party will bear its own costs and expenses (including
legal fees and expenses) incurred in connection with this Agreement and the
transactions contemplated hereby.
(l) Construction. The Parties have participated jointly in the negotiation
and drafting of this Agreement. In the event an ambiguity or question of intent
or interpretation arises, this Agreement shall be construed as if drafted
jointly by the Parties and no presumption or burden of proof shall arise
favoring or disfavoring any Party by virtue of the authorship of any of the
provisions of this Agreement. Any reference to any federal, state, local, or
foreign statute or law shall be deemed also to refer to all rules and
regulations promulgated thereunder, unless the context requires otherwise. The
word "including" shall mean including without limitation.
(m) Incorporation of Exhibits and Schedules. The Exhibits, Schedules, and
other documents referred to in Section 1(e) in this Agreement are incorporated
herein by reference and made a part hereof.
(n) Bulk Transfer Laws. MDSI acknowledges that Neoforma and LifeLine will
not comply with the provisions of any bulk transfer laws of any jurisdiction in
connection with the transactions contemplated by this Agreement. Neoforma and
LifeLine jointly and severally agree to indemnify, defend, and hold MDSI
harmless from and against any liability arising from their failure to comply
with any such bulk transfer laws.
10. Definitions.
"Accredited Investor" has the meaning set forth in Regulation D promulgated
under the Securities Act.
"Acquired Assets" means all of the right, title, and interest in and to all
of the assets that LifeLine possesses and has the right to transfer, including
all of LifeLine's (a) real property, leaseholds and subleaseholds therein,
improvements, fixtures, and fittings thereon, and easements, rights-of-way, and
other appurtenants thereto (such as appurtenant rights in and to public
streets), (b) tangible personal property (such as machinery, equipment,
inventories of raw materials and supplies, manufactured and purchased parts,
goods in process and finished goods, furniture, automobiles, trucks, tractors,
trailers, tools, jigs, and dies), (c) Intellectual Property (as defined in
Section 2(k) above), Databases (as defined in Section 2(dd) above), goodwill
associated therewith, licenses and sublicenses granted and obtained with respect
thereto, and rights thereunder, remedies against infringements thereof, and
rights to protection of interests therein under the laws of all jurisdictions,
(d) leases, subleases, and rights thereunder, (e) agreements, contracts,
indentures, mortgages, instruments, Security Interests, guaranties, other
similar arrangements, and rights thereunder, (f) accounts, notes, and other
receivables,
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(g) securities, (h) claims, deposits, prepayments, causes of action, choses in
action, rights of recovery, rights of set off, and rights of recoupment
(including any such item relating to the payment of taxes), (i) franchises,
approvals, permits, licenses, orders, registrations, certificates, variances,
and similar rights obtained from governments and governmental agencies, (j)
books, records, ledgers, files, documents, correspondence, lists, plats,
architectural plans, drawings, and specifications, creative materials,
advertising and promotional materials, studies, reports, and other printed or
written materials and (k) all Cash; provided, however, that the Acquired Assets
shall not include (x) the corporate charter, qualifications to conduct business
as a foreign corporation, arrangements with registered agents relating to
foreign qualifications, taxpayer and other identification numbers, seals, minute
books, stock transfer books, blank stock certificates, and other documents
relating to the organization, maintenance, and existence of LifeLine as a
corporation or (y) any of the rights of LifeLine under this Agreement (or under
any side agreement between LifeLine on the one hand and MDSI on the other hand
entered into on or after the date of this Agreement).
"Adverse Consequences" means all actions, suits, proceedings, hearings,
investigations, charges, complaints, claims, demands, injunctions, judgments,
orders, decrees, rulings, damages, dues, penalties, fines, costs, liabilities,
obligations, taxes, liens, losses, expenses, and fees, including court costs and
reasonable attorneys' fees and expenses.
"Affiliate" has the meaning set forth in Rule 12b-2 of the regulations
promulgated under the Securities Exchange Act.
"Affiliated Group" means any affiliated group within the meaning of Section
1504 of the Code or any similar group defined under a similar provision of
state, local, or foreign law.
"Assumed Liabilities" means all liabilities relating to "Deferred Income"
of LifeLine as set forth in the Financial Statements and the accrued vacation
liabilities referred to in Section 5(f) above; provided, however, that the
Assumed Liabilities shall not include (x) any liability of LifeLine for unpaid
taxes (with respect to LifeLine or otherwise) for periods prior to the Closing,
(ii) any liability of Neoforma or LifeLine for any Income Taxes arising because
LifeLine is transferring the Acquired Assets, or (iii) any liability or
obligation of LifeLine under this Agreement (or under any side agreement between
LifeLine on the one hand and MDSI on the other hand entered into on or after the
date of this Agreement) or (y) any other liability of any kind or type of
Neoforma or LifeLine.
"Cash" means cash and cash equivalents (including marketable securities and
short term investments) calculated in accordance with GAAP applied on a basis
consistent with the preparation of the Financial Statements.
"Closing" has the meaning set forth in Section 1(d).
"Closing Date" has the meaning set forth in Section 1(d).
"COBRA" means Section 4980B of the Code or similar state law.
"Code" means the Internal Revenue Code of 1986, as amended.
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"Confidential Information" means any information concerning the businesses
and affairs of LifeLine that is not already generally available to the public.
"Continuees" has the meaning set forth in Section 5(f)(v).
"Disclosure Schedule" has the meaning set forth in Section 2.
"Employee Benefit Plan" means any (a) nonqualified deferred compensation or
retirement plan, (b) Employee Pension Benefit Plan, (c) any Multiemployer Plan,
or (d) Employee Welfare Benefit Plan.
"Employee Pension Benefit Plan" has the meaning set forth in Section 3(2)
of ERISA.
"Employee Welfare Benefit Plan" has the meaning set forth in Section 3(1)
of ERISA.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended.
"Financial Statements" has the meaning set forth in Section 2(f).
"GAAP" means United States generally accepted accounting principles as in
effect from time to time.
"Income Tax" means any federal, state, local, or foreign income tax,
including any interest, penalty, or addition thereto.
"Income Tax Return" means any return, declaration, report, claim for
refund, or information return or statement relating to Income Taxes, including
any schedule or attachment thereto.
"Indemnified Party" has the meaning set forth in Section 7(d).
"Indemnifying Party" has the meaning set forth in Section 7(d).
"knowledge" means actual knowledge without independent investigation.
"MDSI" has the meaning set forth in the preface.
"MDSI Note" has the meaning set forth in Section 1(c).
"Most Recent Financial Statements" has the meaning set forth in Section
2(f).
"Most Recent Fiscal Month End" has the meaning set forth in Section 2(f).
"Multiemployer Plan" has the meaning set forth in Section 4001(a)(3) of
ERISA.
"Neoforma" has the meaning set forth in the preface.
"Ordinary Course of Business" means the ordinary course of business
consistent with past custom and practice (including with respect to quantity and
frequency).
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"Party" has the meaning set forth in the preface.
"Person" means an individual, a partnership, a corporation, an association,
a joint stock company, a trust, a joint venture, an unincorporated organization,
or a governmental entity (or any department, agency, or political subdivision
thereof).
"Purchase Price" has the meaning set forth in Section 1(c).
"Retained Employees" has the meaning set forth in Section 5(f)(i).
"Securities Act" means the Securities Act of 1933, as amended.
"Securities Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"Security Interest" means any mortgage, pledge, lien, encumbrance, charge,
or other security interest, other than (a) mechanic's, materialmen's, and
similar liens, (b) liens for taxes not yet due and payable or for taxes that the
taxpayer is contesting in good faith through appropriate proceedings, (c)
purchase money liens and liens securing rental payments under capital lease
arrangements, and (d) other liens arising in the Ordinary Course of Business and
not incurred in connection with the borrowing of money.
"Subsidiary" means any corporation with respect to which a specified Person
(or a Subsidiary thereof) owns a majority of the common stock or has the power
to vote or direct the voting of sufficient securities to elect a majority of the
directors.
"Third Party Claim" has the meaning set forth in Section 7(d)..
"Transferred Employees" has the meaning set forth in Section 5(f)(i).
"LifeLine" has the meaning set forth in the preface.
******
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IN WITNESS WHEREOF, the Parties hereto have executed this Agreement as of
the date first above written.
MEDICAL DISTRIBUTION SOLUTIONS, INC.
/s/ Xxxxx Xxxxx
------------------------
By: Xxxxx Xxxxx
Title: President
XXXXXXXX.XXX, INC.
/s/ Xxxxxx X. Xxxxxx
------------------------
By: Xxxxxx X. Xxxxxx
Title: President
NEOFORMA LIFELINE, INC.
/s/ Xxxxxx X. Xxxxxx
------------------------
By: Xxxxxx X. Xxxxxx
Title: President
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EXHIBIT A
--------------------------------------------------------------------------------
This Note was originally issued on March 31, 2001 and has not been registered
under the Securities Act of 1933, as amended.
--------------------------------------------------------------------------------
NOTE
March 31, 2001
$750,000.00 Norcross, Georgia
The undersigned, for value received, promises to pay to the order of
XXXXXXXX.XXX, INC. ("Neoforma") the amount of Seven Hundred Fifty Thousand
Dollars ($750,000.00), such principal amount to be payable in the amount of One
Hundred Fifty Thousand Dollars ($150,000.00) on April 1, 2003, Two Hundred
Twenty Five Thousand Dollars ($225,000) on April 1, 2004, and Three Hundred
Seventy Five Thousand Dollars on April 1, 2005.
No interest shall be payable by the undersigned on the unpaid principal
amount of this Note from the date hereof until this Note is paid in full.
This Note evidences indebtedness incurred under, and is subject to the
terms and provisions of, the Asset Purchase Agreement, dated as of March 31,
2001, among the undersigned, Neoforma and Neoforma Lifeline, Inc., as amended or
otherwise modified from time to time.
This Note is made under and governed by the laws of the State of Delaware
excluding that body of law pertaining to conflict of laws.
MEDICAL DISTRIBUTION SOLUTIONS, INC.
------------------------------------
Name:
Title:
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EXHIBIT B
SERVICES AGREEMENT
This Services Agreement ("Agreement") is entered into as of March 31, 2001
("Effective Date") by and between Xxxxxxxx.xxx, Inc. ("Neoforma"), a Delaware
corporation with headquarters at 0000 Xxxxxx Xxxx, Xxx Xxxx, XX 00000 and
Medical Distribution Solutions, Inc., a Georgia corporation ("MDSI") with
respect to the following.
R E C I T A L
MDSI desires to provide, and Neoforma desires to have MDSI provide various
news, magazine and advertising services as an independent contractor to
Neoforma.
NOW, THEREFORE, the parties agree as follows:
1. Services.
(a) Performance. MDSI agrees to use its best efforts to perform the
services (the "Services") described in detail on Exhibit A to this Agreement
(the "Project Description") during the term of this Agreement.
(b) Payment. As sole compensation for the performance of the Services,
Neoforma will pay MDSI the fees stated in the Project Description. Any expenses
incurred by MDSI in performing the Services will be the sole responsibility of
MDSI. Neoforma will pay each such invoice no later than thirty (30) days after
its receipt on services exceeding $100,000 in any given year.
2. Relationship of Parties.
(a) Independent MDSI. MDSI is an independent contractor and is not an
agent or employee of, and has no authority to bind, Neoforma by contract or
otherwise. MDSI will determine, in MDSI's sole discretion, the manner and means
by which the Services are accomplished, subject to the requirement that MDSI
shall at all times comply with applicable law. Neoforma has no right or
authority to control the manner or means by which the Services are accomplished.
(b) Employment Taxes and Benefits. MDSI will report as revenue all
compensation received by MDSI pursuant to this Agreement.
3. Neoforma Confidential Information. MDSI acknowledges that MDSI will
acquire information and materials from Neoforma and knowledge about the
business, products, programming techniques, experimental work, customers,
clients and suppliers of Neoforma and that all such knowledge, information and
materials acquired, the existence, terms and conditions of this Agreement, and
the Designs and Materials, are and will be the trade secrets and confidential
and proprietary information of Neoforma (collectively "Neoforma
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Confidential Information"). Neoforma Confidential Information will not include,
however, any information which is or becomes part of the public domain through
no fault of MDSI or that Neoforma regularly gives to third parties without
restriction on use or disclosure. MDSI agrees to hold all such Neoforma
Confidential Information in strict confidence, not to disclose it to others or
use it in any way, commercially or otherwise, except in performing the Services,
and not to allow any unauthorized person access to it, during the term of this
Agreement and for three years after its expiration or termination. MDSI shall
take all action reasonably necessary and satisfactory to protect the
confidentiality of the Neoforma Confidential Information including, without
limitation, implementing and enforcing operating procedures to minimize the
possibility of unauthorized use or copying of the Neoforma Confidential
Information.
4. MDSI Confidential Information. Neoforma acknowledges that Neoforma will
acquire information and materials from MDSI and knowledge about the business,
products, programming techniques, experimental work, customers, clients and
suppliers of MDSI and that all such knowledge, information and materials
acquired, the existence, terms and conditions of this Agreement, and the Designs
and Materials, are and will be the trade secrets and confidential and
proprietary information of MDSI (collectively " MDSI Confidential Information").
MDSI Confidential Information will not include, however, any information which
is or becomes part of the public domain through no fault of Neoforma or that
MDSI regularly gives to third parties without restriction on use or disclosure.
Neoforma agrees to hold all such MDSI Confidential Information in strict
confidence, not to disclose it to others or use it in any way, commercially or
otherwise, except in performing the Services, and not to allow any unauthorized
person access to it, during the term of this Agreement and for three years after
its expiration or termination. Neoforma shall take all action reasonably
necessary and satisfactory to protect the confidentiality of the MDSI
Confidential Information including, without limitation, implementing and
enforcing operating procedures to minimize the possibility of unauthorized use
or copying of the MDSI Confidential Information.
5. Indemnification by MDSI. MDSI shall indemnify Neoforma and hold it
harmless from and against all claims, damages, losses and expenses, including
court costs and reasonable fees and expenses of attorneys, expert witnesses and
other professionals, arising out of or resulting from, and, at Neoforma's
option, MDSI will defend Neoforma against:
(a) any action by a third party against Neoforma that is based on any
claim that any Services performed under this Agreement, or their results,
infringe a patent, copyright or other proprietary right or violate a trade
secret; and
(b) any action by a third party against Neoforma that is based on any
negligent act or omission or willful conduct of MDSI and which results in: (i)
any bodily injury, sickness, disease or death; (ii) any injury or destruction to
tangible or intangible property (including computer programs and data) or any
loss of use resulting therefrom; or (iii) any violation of any statute,
ordinance, or regulation.
6. Indemnification by Neoforma. Neoforma shall indemnify MDSI and hold it
harmless from and against all claims, damages, losses and expenses, including
court costs and reasonable fees and expenses of attorneys, expert witnesses and
other professionals, arising out of or resulting from, and, at MDSI 's option,
Neoforma will defend MDSI against:
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(a) any action by a third party against MDSI that is based on any
claim that any Services performed under this Agreement, or their results,
infringe a patent, copyright or other proprietary right or violate a trade
secret; and
(b) any action by a third party against MDSI that is based on any
negligent act or omission or willful conduct of Neoforma and which results in:
(i) any bodily injury, sickness, disease or death; (ii) any injury or
destruction to tangible or intangible property (including computer programs and
data) or any loss of use resulting therefrom; or (iii) any violation of any
statute, ordinance, or regulation.
7. Termination and Expiration.
(a) Breach. Either party may terminate this Agreement in the event of
a breach by the other party to this Agreement if such breach continues uncured
for a period of thirty (30) days after written notice.
(b) Term. The term of this Agreement shall commence upon the Effective
Date and continue thereafter for five years, unless sooner terminated pursuant
to Section 6(a).
(c) Automatic. This Agreement terminates automatically, with no
further action of either party, if either party is adjudicated bankrupt, files a
voluntary petition of bankruptcy, makes a general assignment for the benefit of
creditors, is unable to meet its obligations in the normal course of business or
if a receiver is appointed on account of either party's insolvency.
(d) No Election of Remedies. The election by either party to terminate
this Agreement in accordance with its terms shall not be deemed an election of
remedies, and all other remedies provided by this Agreement or available at law
or in equity shall survive any termination.
8. Effect of Expiration or Termination. Upon the expiration or termination
of this Agreement for any reason:
(a) each party will be released from all obligations to the other
arising after the date of expiration or termination, except that expiration or
termination of this Agreement will not relieve either party of its obligations
under Sections 2(b), 3, 4, 5, 8, 9(b) and 10, nor will expiration or termination
relieve MDSI or Neoforma from any liability arising from any breach of this
Agreement;
(b) MDSI will promptly notify Neoforma of all Neoforma Confidential
Information, including but not limited to the Designs and Materials, in MDSI's
possession and, at the expense of MDSI and in accordance with Neoforma's
instructions, will promptly deliver to Neoforma all such Neoforma Confidential
Information; and
(c) Neoforma will promptly notify MDSI of all MDSI Confidential
Information, including but not limited to the Designs and Materials, in
Neoforma's possession and, at the expense of Neoforma and in accordance
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with MDSI's instructions, will promptly deliver to MDSI all such MDSI
Confidential Information
9. Limitation of Liability. IN NO EVENT SHALL EITHER PARTY BE LIABLE TO THE
OTHER FOR ANY SPECIAL, INCIDENTAL, INDIRECT OR CONSEQUENTIAL DAMAGES OF ANY KIND
IN CONNECTION WITH THIS AGREEMENT, EVEN IF A PARTY HAS BEEN INFORMED IN ADVANCE
OF THE POSSIBILITY OF SUCH DAMAGES.
10. Covenants.
(a) Pre-existing Obligations. each party represents and warrants that
it is not under any pre-existing obligation inconsistent with the provisions of
this Agreement.
(b) Solicitation of Employment. Because of the trade secret subject
matter of Neoforma's business, each party agrees that it will not solicit the
services of any of the employees, contractors, suppliers or customers of the
other party during the term of this Agreement and for six (6) months thereafter.
11. General.
(a) Assignment. Neither party may not assign its rights or delegate
its duties under this Agreement either in whole or in part without the prior
written consent of the other party. Any attempted assignment or delegation
without such consent will be void.
(b) Equitable Remedies. Because the Services are personal and unique
and because each party will have access to the Confidential Information of the
other, either party will have the right to enforce this Agreement and any of its
provisions by injunction, specific performance or other equitable relief without
prejudice to any other rights and remedies that it may have for a breach of this
Agreement. If Neoforma files for bankruptcy or is declared insolvent, MDSI shall
have the right to offset any amounts owed by Neoforma against the Note dated
March 31, 2001 made by MDSI to LifeLine. If MDSI files for bankruptcy or is
declared insolvent, Neoforma shall have the right terminate this Agreement and
cease all payments hereunder except for payments due to MDSI for services
already furnished.
(c) Attorneys' Fees. If any action is necessary to enforce the terms
of this Agreement, the substantially prevailing party will be entitled to
reasonable attorneys' fees, costs and expenses in addition to any other relief
to which such prevailing party may be entitled.
(d) Governing Law; Severability. This Agreement will be governed by
and construed in accordance with the laws of the State of California excluding
that body of law pertaining to conflict of laws. If any provision of this
Agreement is for any reason found to be unenforceable, the remainder of this
Agreement will continue in full force and effect.
(e) Notices. Any notices under this Agreement will be sent by
certified or registered mail, return receipt requested, to the address specified
below or such other address as the party specifies in writing. Such notice will
be effective upon its mailing as specified.
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(f) Complete Understanding; Modification. This Agreement, together
with Exhibit A, constitutes the complete and exclusive understanding and
agreement of the parties and supersedes all prior understandings and agreements,
whether written or oral, with respect to the subject matter hereof. Any waiver,
modification or amendment of any provision of this Agreement will be effective
only if in writing and signed by the parties hereto.
IN WITNESS WHEREOF, the parties have signed this Agreement as of the
Effective Date.
COMPANY: MDSI:
By: By:
----------------------------------- -----------------------------------
Title:
--------------------------------
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EXHIBIT A
Project Description
1. MDSI shall provide Neoforma with services that shall initially include: (a) a
customized version of the *, (b) a premium medical content service (*), with
specifics to be mutually agreed upon in good faith by the parties, (c)
advertising space at rates agreed upon by MDSI and Neoforma. Neoforma may
request other services in lieu of these services, upon receipt of written
consent from MDSI.
2. Neoforma shall make the first payment of * for the initial year's services on
April 1, 2001 or on the Closing of the Asset Purchase Agreement between the
parties, whichever is later. Neoforma shall make its second and subsequent
annual payments on January 1, 2002, and on each of January 1, 2003, 2004 and
2005. Neoforma's payments shall be allocated annually as follows:
(a) *: *
(b) Premium content service: *
(c) Advertising: * less amounts for the * and * (e.g., *)
provided, that Neoforma may change the allocation between premium content
service and advertising in its reasonable discretion * annually upon three
months prior notice to MDSI Neoforma may request changes to customized services,
such as the * and the premium content service, semi-annually and to
non-customized services, such as advertising, quarterly, but shall continue to
purchase * worth of * as specified above.
3. Neoforma may purchase additional services from MDSI (i.e. in excess of the
annual * commitment) at mutually agreeable rates.
4. MDSI shall pay Neoforma * of the subscription revenue generated from sales of
the premium medical content service and * of the revenue generated from sales of
any other MDSI products or services by Neoforma or through Neoforma distribution
channels.
* Confidential treatment requested.
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