AMENDMENT NO. 2 TO MANAGEMENT SERVICES AGREEMENT
Exhibit 10.3
THIS AMENDMENT NO. 2 TO MANAGEMENT SERVICES AGREEMENT (this “Amendment”) is made and entered
into effective as of April 30, 2009 by and between Virtual Radiologic Corporation, a Delaware
corporation (“VRC”), Virtual Radiologic Professionals of Illinois, S.C., an Illinois professional
corporation (the “Practice”) and Xxxxxx Xxxxxx, M.D., who is hereby joined as a party to the
Agreement (as defined below) solely with respect to the provisions of Sections 12.1 thereof, as
modified by this Amendment. VRC, the Practice and Xx. Xxxxxx are referred to herein each
individually as a “party,” and together the “parties.”
WHEREAS, VRC and the Practice entered into that certain Management Services Agreement
effective January 1, 2006, as amended (the “Agreement”);
WHEREAS, pursuant to the Agreement, VRC provides systems infrastructure and management and
administrative services to the Practice in order to permit the Practice to devote its full effort
to the performance of professional radiology services on behalf of physician groups and other
customers of the Practice;
WHEREAS, the Practice is a single stockholder professional corporation, and the parties wish
to ensure for an orderly transition of the ownership of the Practice in certain circumstances to an
individual who is qualified to own the shares of the Practice.
NOW, THEREFORE, for and in consideration of the premises and the mutual covenants and
agreements contained herein, and other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, and on the terms and subject to the conditions herein set forth,
the Parties have agreed and do hereby agree as follows:
1. Section 12.1 of the Agreement is amended and restated to read as follows:
Section 12.1 Redemption, Sale to Substitute Stockholder.
Upon the occurrence of any of the following events, the shares held by any
then-current stockholder of the Practice will automatically be redeemed by the
Practice, and the Practice, without the need for any further action by any
Practice stockholder, officer or director, will immediately sell such shares to an
individual who is qualified to hold such shares under Delaware law:
(i) Death of the stockholder;
(ii) Disability of the stockholder;
(iii) The stockholder’s “disqualification” within the meaning of the
Illinois Professional Service Corporation Act;
(iv) Actual or proposed voluntary or involuntary transfer of shares,
whether by court or otherwise, including, without limitation, by reason of
the bankruptcy or divorce of a stockholder;
(v) Actual or threatened breach of this Management Agreement by the
stockholder; or
(vi) Any other action or inaction which, in the opinion of VRC following
due consultation with appropriate professionals, would jeopardize the
provision of professional medical services provided by the Practice or any
of VRC’s affiliated medical practices.
VRC shall administer and execute any redemption and subsequent sale of
shares under this Section as part of VRC’s duties under this Agreement,
including without limitation, the designation of an individual to purchase
the shares who is qualified to hold the shares under Delaware law. The
consideration for both any redemption and sale subsequent to a redemption
under this Section shall be the lower of the purchase price paid for such
shares by the relevant stockholder or the book value of such shares. Each
stockholder of the Practice, on behalf of the stockholder and such
stockholder’s successors and assigns, agrees to execute and deliver such
instruments and take such other actions as VRC or the Practice may require
in order to carry out the redemption and sale of shares as provided in
this Section 12.1.
2. Section 12.2 of the Agreement is amended and restated to read as follows:
Section 12.2 Conduct of Business Following Redemption. In the case of
redemption by the Practice as a result of any of the events described in Section
12.1, the Practice agrees that it will conduct its business in the ordinary course
and will comply with all obligations which it is subject to, including, but not
limited to this Management Agreement and all client agreements.
A. Capitalized terms used herein and not defined shall have the meanings ascribed to them in
the Agreement.
B. All of the terms, provisions, covenants, conditions, and obligations of this Amendment
shall be binding upon, and inure to the benefit of, the successors in interest and permitted
assigns of the parties hereto.
C. All other provisions of the Agreement shall remain in full force and effect.
IN WITNESS WHEREOF, the parties have duly executed this Amendment.
| VIRTUAL RADIOLOGIC CORPORATION | ||||||
| By: | /s/ Xxxxxx X. Kill | |||||
| Title: | President and Chief Executive Officer | |||||
| VIRTUAL RADIOLOGIC | ||||||
| PROFESSIONALS OF ILLINOIS, S.C. | ||||||
| By: | /s/ Xxxxxx Xxxxxx, M.D. | |||||
| Title: | President | |||||
| /s/ Xxxxxx Xxxxxx, M.D. | ||||||
| Xxxxxx Xxxxxx, M.D. | ||||||
