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Exhibit 10.24
DIALYSIS PROGRAM
MANAGEMENT AGREEMENT
THIS AGREEMENT is made effective this 1st day of March, 1996 ("Effective Date")
by and between The Cleveland Clinic Foundation, an Ohio non-profit corporation,
and Renal Care Group, Inc., a Tennessee corporation ("Management Company").
WITNESSETH:
WHEREAS, Management Company is engaged in the business of managing
dialysis units; and
WHEREAS, The Cleveland Clinic Foundation desires that Management
Company manage its current outpatient dialysis services program ("UNIT")
pursuant to this Agreement; and
WHEREAS, Management Company agrees to manage the UNIT under the name,
The Cleveland Clinic Foundation;
NOW, THEREFORE, in consideration of the mutual covenants and
undertakings contained in this Agreement, The Cleveland Clinic Foundation and
Management Company agree as follows:
I. AUTHORITY OF THE PARTIES
1.1 Ultimate Control. The Cleveland Clinic Foundation shall at all
times exercise ultimate authority and control over the policies and assets of
the UNIT, and shall retain the ultimate authority and responsibility regarding
the powers, duties, and responsibilities vested in The Cleveland Clinic
Foundation with respect to the UNIT by applicable law and regulations. In
accordance with the intent of the parties, Management Company shall, subject to
the approval of The Cleveland Clinic Foundation, establish general
administrative policies which shall be carried out by Management Company as
specified under this Agreement.
1.2 Grant of Day-to-Day Management Authority. Subject to the
foregoing, and to supervision of all professional medical care by the Medical
Director as provided below, The Cleveland Clinic Foundation hereby grants and
delegates to Management Company the authority to supervise and manage the
day-to-day operations of the UNIT and to perform the specific functions set out
in this Agreement. The Cleveland Clinic Foundation shall cooperate with
Management Company in order to facilitate Management Company's efficient
performance of its management responsibilities under this Agreement.
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1.3 Relationship of the Parties. The parties hereto intend by this
Agreement solely to effect the appointment of Management Company for
administrative management of UNIT as described herein, and does not extend to
or involve any other activities of either The Cleveland Clinic Foundation or
Management Company, except as set forth in Section 1.4 herein. No other
relationship is intended to be created between the parties hereto and nothing
in this Agreement shall be construed as to make either party hereto the
employer or employee of the other, agent or principal of the other, the joint
venturer or partner of the other, or have the right to, or control of, or in any
manner conduct the other's business; other than as is herein explicitly
provided.
1.4 Exclusivity. Without the prior consent of The Cleveland Clinic
Foundation, Management Company shall not provide outpatient dialysis management
services other than to The Cleveland Clinic Foundation during the term of this
Agreement within the area outlined on Exhibit A attached hereto and made a part
hereof; provided, however, that this shall not prohibit the Management Company
from providing such services to MetroHealth System (which shall include its
affiliated entities) in Cleveland, Ohio.
II. MANAGEMENT PERSONNEL
2.1 Administrator.
2.1.1 Management Company shall hire and appoint an administrator
for the UNIT ("Administrator"), who shall be an employee of Management Company.
Notwithstanding the above, the appointment of the Administrator shall be
subject to the approval of The Cleveland Clinic Foundation.
2.1.2 The Administrator shall have general day-to-day
responsibility for the management of the UNIT, other than those duties
specifically delegated to the Medical Director pursuant to this Agreement.
2.2 Medical Director.
2.2.1 The Cleveland Clinic Foundation, on the recommendation of
the Director of the Division of Nephrology at The Cleveland Clinic Foundation,
shall hire or retain and appoint, and may remove, the Medical Director of the
UNIT, who shall be and remain an employee of The Cleveland Clinic Foundation.
2.2.2 The Medical Director shall supervise all professional
medical services performed in the UNIT and shall undertake overall coordination
of utilization review, quality assurance, and related functions as directed by
The Cleveland Clinic Foundation. The Medical Director may perform other duties
as The Cleveland Clinic Foundation may deem appropriate, and which do not
interfere with the performance of the Medical Director's duties under this
agreement. The Cleveland Clinic Foundation shall be responsible for the
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compensation, including fringe benefits, expenses, including professional
liability insurance, and other support and operating costs of the Medical
Director.
2.3 Other Personnel. The Cleveland Clinic Foundation and Management
Company each shall, at its sole expense, employ, pay, and supervise some other
personnel reasonably necessary to perform each party's duties under this
Agreement, and in such party's discretion may remove and/or reassign such other
personnel, and locate such personnel at such places as are appropriate.
Subject to the prior approval of the Medical Director and in accordance with
the terms of the Annual Operating Plan, as further described in Section 3.2,
the Management Company shall provide certain personnel, such as registered
nurses, for patient care purposes (hereinafter "Management Company Patient Care
Personnel"). The Cleveland Clinic Foundation and Management Company shall each
be responsible for the compensation, including fringe benefits, expenses, and
other support and operating costs of the personnel it employs; provided,
however, that Management Company shall be reimbursed by The Cleveland Clinic
Foundation, as set forth in the Annual Operating Plan, approved by The
Cleveland Clinic pursuant to Section 3.2 hereon, for the cost of the Management
Company Health Care Personnel assigned to and performing services at the Unit.
2.4 In the event either party reasonably determines that any personnel
provided by the other party should be terminated or re-assigned as a result of
lack of competence, conduct or behavior detrimental to patient care, the party
employing such individual shall promptly review such determination and make
reasonable best efforts to take appropriate personnel action, in accordance
with its customary personnel policies and procedures.
III. ADMINISTRATIVE SERVICES
3.1 General Responsibilities and Services. Management Company shall
perform those services as set forth in this Article III, and all related
functions as are reasonably necessary for the effective management of the
operations of the UNIT. Management Company shall establish operational
policies for the UNIT, subject to The Cleveland Clinic Foundation's approval,
and shall implement those policies. Management Company shall perform its
services diligently in accordance with generally recognized standards of good
management in the health care industry relating to dialysis centers, in the
reasonable exercise of Management Company's judgment, and in accordance with
performance standards to be developed by Management Company and updated
annually, which standards will be subject to the review and approval of The
Cleveland Clinic Foundation. Nothing in this Agreement shall be construed to
require or permit the practice of medicine by Management Company or any
employee thereof.
3.2 Preparation and Adoption of Annual Operating Plan. Management
Company shall prepare, for The Cleveland Clinic Foundation's approval, an
annual operating plan ("Annual Operating Plan") for each fiscal year or part
thereof during which this Agreement is in effect. The Annual Operating Plan
shall set out major operating objectives and anticipated revenues and expenses
of the UNIT and will be presented to The Cleveland Clinic
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Foundation for its acceptance, rejection, or modification not later than three
(3) months prior to the beginning of each fiscal year, except that the first
Annual Operating Plan shall be presented to The Cleveland Clinic Foundation
prior to the execution of this Agreement. After the Annual Operating Plan has
been modified to incorporate any changes made by The Cleveland Clinic
Foundation, and subject to the provisions of this Agreement, it shall serve as
a guide for the operation of the UNIT. The Annual Operating Plan will include
information with respect to the UNIT's major business objectives, anticipated
revenues and expenses, capital expenditures, cash flow, enrollment and staffing
projections, and a discussion of anticipated changes, if any, in utilization,
patient charges, and other significant criteria identified by The Cleveland
Clinic Foundation. Management Company may, from time to time, propose
modifications to the Annual Operating Plan which it deems necessary or
advisable, which modifications shall be incorporated into the Annual Operating
Plan upon approval by The Cleveland Clinic Foundation. The Cleveland Clinic
Foundation may also, from time to time, propose modifications to the Annual
Operating Plan which it deems necessary and advisable, which modifications
shall, after consultation with Management Company, be incorporated into the
Annual Operating Plan.
3.3 Billing and Collection of Accounts. Management Company shall,
at its expense, design, implement and maintain a billing and collection system
and procedures appropriate to the UNIT's operations using the UNIT's End State
Renal Dialysis ("ESRD") Number. These procedures shall be in accordance with
billing and collection policies approved by The Cleveland Clinic Foundation.
Management Company shall supply directly to The Cleveland Clinic Foundation all
patient billing and collection data produced or administered by Management
Company. The Cleveland Clinic Foundation shall retain sole authority to xxxx
and to take prompt action to collect accounts owed to the UNIT in The Cleveland
Clinic Foundation's or the UNIT's name and on The Cleveland Clinic Foundations'
behalf, and to take possession of and endorse in The Cleveland Clinic
Foundation's name any cash, notes, checks, money orders, insurance payments,
and other instruments received in payment for services rendered by the UNIT.
3.4 Deposit and Disbursement of Funds.
3.4.1 Management Company shall promptly deposit all funds it
receives on behalf of The Cleveland Clinic Foundation in federally-insured
accounts established by The Cleveland Clinic Foundation in The Cleveland
Clinic Foundations's name with banks or other appropriate depository
institutions. Management Company shall pay for all operating expenses of the
UNIT as set forth in the Annual Operating Plan approved by The Cleveland Clinic
Foundation, and shall be reimbursed by The Cleveland Clinic Foundation on an
actual cost basis for all approved expenditures. Management Company shall
request reimbursement from The Cleveland Clinic Foundation on a fortnightly or
less frequent basis and shall accompany each request for reimbursement with an
itemized statement of the actual expenditures to be reimbursed. Disbursements
for approved expenses must be supported by vouchers, receipts, or other
reasonable records duly approved by the Administrator or his/her
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delegate, and Management Company shall provide copies of these to The Cleveland
Clinic Foundation upon request.
3.5 Accounting Records and Reports. Management Company shall implement
and maintain an appropriate accounting system adequate for the UNIT's needs and
shall cause to be delivered to The Cleveland Clinic Foundation monthly
unaudited financial statements for the UNIT. These statements shall be
prepared on an accrual basis in accordance with generally accepted accounting
principles. These financial statements shall be delivered to The Cleveland
Clinic Foundation on or before the tenth (10) business day of the following
month, commencing March, 1996. Management Company will also prepare and
deliver to The Cleveland Clinic Foundation such other reports as are necessary
to manage the UNIT including, but not limited to, quarterly service reports
(analyzing the utilization and cost of dialysis services and supplies provided,
and quarterly billing reports. Within twelve (12) days after the end of each
Cleveland Clinic Foundation's fiscal year, Management Company shall prepare and
deliver to The Cleveland Clinic Foundation unaudited financial statements. Any
financial books and records of the Management Company that relate to its
operation of the UNIT shall be available for inspection by The Cleveland Clinic
Foundation or its delegates during normal business hours or otherwise upon
reasonable notice. With respect to all such reports and financial statements,
Management Company shall be entitled to supplement such reports and financial
statements from time to time as deemed necessary by Management Company.
3.6 Ancillary and Other Agreements. On behalf of The Cleveland Clinic
Foundation, Management Company shall negotiate and enter into such
administrative agreements, with terms not exceeding one (1) year (unless a
longer term is approved in writing by The Cleveland Clinic Foundation prior to
execution), as Management Company reasonably deems necessary or advisable for
the furnishing of utilities, services, concessions, and non-physician services
and supplies for the maintenance and operation of the UNIT, other than those
directly provided by Management Company hereunder.
3.7 Other Agreements. Except as provided in the approved Annual
Operating Plan or as otherwise specifically provided herein, Management Company
shall not enter into any contracts, agreements, leases, debts, obligations, or
legal commitments on behalf of The Cleveland Clinic Foundation or make any
capital expenditure involving an expense in excess of $10,000 on behalf of the
UNIT, or dispose of any asset of the UNIT having a value of more than $10,000,
except as approved in writing prior to execution by The Cleveland Clinic
Foundation.
3.8 Limitation of Contractual Liability. In the event this Management
Agreement is terminated by either party as set forth in Section VIII, The
Cleveland Clinic Foundation's sole liability under agreements entered into by
Management Company pursuant to Sections 3.6 and 3.7 shall be limited to payment
for all supplies and services received and accepted by The Cleveland Clinic
Foundation. In addition, the Management Company shall, upon request from The
Cleveland Clinic Foundation, use its best efforts to promptly terminate such
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agreements. Upon receipt of payment for such supplies and services, Management
Company shall hold The Cleveland Clinic Foundation harmless for any other
claims or liabilities alleged or brought by third parties related to such
agreements.
3.9 Regulatory Requirements. Management Company shall prepare and submit
on behalf of the UNIT all necessary reports and filings, including cost and
utilization reports, supporting data and other material required in connection
with reimbursement under Medicare, Medicaid, Nationwide Insurance Company, and
other third-party payment contracts and programs in which the UNIT may from
time to time participate. In addition, Management Company shall take all other
appropriate actions necessary for regulatory compliance or otherwise advisable
in order that The Cleveland Clinic Foundation be in compliance with any
requirements of local, state, or federal agencies having jurisdiction over the
UNIT's operations, or in order to comply with requirements of payors, provided
that Management Company shall consult with The Cleveland Clinic Foundation on
an ongoing basis concerning these functions and compliance.
IV. DUTIES OF THE CLEVELAND CLINIC FOUNDATION
AND MANAGEMENT COMPANY
4.1 Data and Information. The Cleveland Clinic Foundation shall provide
to Management Company without charge all necessary and relevant data and
information in the possession of The Cleveland Clinic Foundation as shall be
reasonably required or requested by Management Company in order to enable it to
perform its duties hereunder.
5.1 Amount of Compensation. In consideration of the services to The
Cleveland Clinic Foundation to be provided by Management Company pursuant to
this Agreement, Management Company will receive a monthly management fee of
Seventy-Six Thousand, Seven Hundred and Thirty-Nine Dollars ($76,739.00) for
each contract month of this Agreement. Such fee represents payment to
Management Company for the general and administrative overhead and executive
management of Management Company. In addition, The Cleveland Clinic Foundation
shall reimburse Management Company for the approved actual operating expenses
of the UNIT as set forth in the Annual Operating Plan approved by The Cleveland
Clinic Foundation pursuant to Section 3.2 hereof. The management fee shall be
paid in monthly installments, payable on or before the tenth (10th) business
day of the following month, commencing as of the Effective Date.
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VI. OWNERSHIP OF WORK PRODUCT
6.1 Work Product
6.1.1 All operating procedures, protocols, information
systems, operating data, patient lists, computer data base, reports, and other
non-public proprietary business systems or information pertaining to or owned
by The Cleveland Clinic Foundation used or obtained by Management Company in
performing its management activities under this Agreement, with respect to the
UNIT, shall be and remain the exclusive property of The Cleveland Clinic
Foundation. All operating procedures, protocols, information systems, computer
data base programs, and other non-public proprietary business systems or
information not uniquely pertaining to The Cleveland Clinic Foundation, that
are or were created, developed, or obtained by Management Company from sources
other than The Cleveland Clinic Foundation shall be the exclusive property of
Management Company. Management Company acknowledges that any and all Cleveland
Clinic Foundation business, patient or financial data residing in any
Management Company database or information system is, and shall remain, the
exclusive property of The Cleveland Clinic Foundation.
6.1.2 Management Company shall not disclose or use for any
other purpose other than for the performance of its obligations hereunder any
confidential or proprietary data, reports, or other information or materials
concerning The Cleveland Clinic Foundation, the UNIT, or its products or
services without the prior written consent of The Cleveland Clinic Foundation,
except as otherwise required by law or regulation applicable to The Cleveland
Clinic Foundation or Management Company.
6.2. Licensure of Service Xxxx.
6.2.1 Management Company acknowledges The Cleveland Clinic
Foundation's exclusive right, title, and interest in and to the trade names and
service marks related to The Cleveland Clinic Foundation, and all related
names, symbols, trade names, and service marks now owned by The Cleveland
Clinic Foundation (the "Marks"). The Marks will not be altered or changed by
Management Company without the prior written approval of The Cleveland Clinic
Foundation. Management Company shall use the Marks only on connection with the
operation and management of the UNIT, and in a manner which shall be subject to
the prior approval of The Cleveland Clinic Foundation. The parties agree that
violations of this Section will result in irreparable harm and that, in
addition to any other rights and remedies provided by law, The Cleveland Clinic
Foundation shall be entitled to injunctive relief to enforce Management
Company's obligations under this Section.
6.2.2 With The Cleveland Clinic Foundation's prior written
approval, the Management Company may, on a non-exclusive basis, use the Marks
in Management Company's service area in connection with the operation of the
UNIT while this Agreement remains in effect. The Cleveland Clinic Foundation
shall have the right to use the marks on its own behalf as well.
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6.2.3 The Cleveland Clinic Foundation shall defend or settle
at its expense any litigation or claim which may be instituted against The
Cleveland Clinic Foundation insofar as such litigation or claim solely contests
the ownership of the Marks.
VII. INSURANCE AND INDEMNIFICATION
7.1 Each party (the"Indemnitor") shall indemnify, save and hold
harmless the other party (the "Indemnitee") from and against any and all
judgments, damages, costs and expenses, including reasonable attorney's fees,
paid or incurred by the Indemnitee in any claim, action or proceeding for damage
to property, injury or death to person, or otherwise, arising solely out of the
proven negligent acts or omissions of Indemnitor in Indemnitor's performance
under this Agreement. Indemnitee obligations as set forth in the preceding
sentence are conditioned upon (i) Indemnitee promptly notifying Indemnitor of
any claim, demand or action, or any incident of which Indemnitee has actual and
constructive knowledge, which may reasonably result in a claim, demand or
action, and for which Imdemnite will look to Indemnitor for indemnification
under this Section, (ii) Indemnitee, its directors, officers, employees and
servants, shall reasonably and in good-faith cooperate with Indemnitor in
Indemnitor's investigation and review of any such claim, demand, action or
incident, and (iii) Indemnitee not entering into any admissions, agreements or
settlements which may affect the rights of Indemnitee or Indemnitor without the
prior written consent and approval of Indemnitor. Indemnitor reserves the
right, in its sole discretion, to assume the defense of Indemnitee in any such
claim, action or proceeding.
7.2 The Indemnitee shall have the right to employ separate counsel
in any such action and to participate in the defense thereof, but the fees and
expenses of such counsel shall be at the expense of such Indemnitee unless (a)
employment of such counsel and payment of the fees and expenses thereof by the
Indemnitor has been specifically authorized by the Indemnitor, or (b) in the
reasonable judgment of such Indemnitee, employment of such counsel is necessary
because the claim or defense for which such counsel is employed is inconsistent
or in conflict with the claims or defenses of the Indemnitor, or (c) the
Indemnitee shall have reasonably concluded that there may be claims or defenses
available to it that are different from or in addition to those available to
the Indemnitor, in any of which events such fees and expenses shall be borne by
the Indemnitor, but in any such event, the Indemnitor shall not have the right
to direct the defense of such action on behalf of the Indemnitee. The
Indemnitor shall not be liable for any settlement of any such action effected
without the Indemnitor's consent by the Indemnitee, but if settled with consent
of the Indemnitor or if there shall be a final judgment for the plaintiff in
such action against the Indemnitee or the Indemnitor with or without the
consent of Indemnitor, the Indemnitor agrees to indemnity and hold harmless the
Indemnitee to the extent provided herein.
7.3 Each party shall procure and maintain for the term of this
Agreement professional liability insurance in a minimum amount of $3,000,000
per incident/$3,000,000 annual aggregate. Each party shall also provide the
other with certificate or affidavit of said coverage. Each party will notify
the other of any cancellation or significant change thirty
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(30) days prior to such cancellation or change. If such coverage is written on
a claims-made form following termination of this Agreement, coverage shall
survive for a period of no less than five (5) years. Coverage shall provide
for a retroactive date of placement coinciding with the Effective Date of this
Agreement. The Cleveland Clinic Foundation shall reimburse Management Company
for that portion of the reasonable cost of such insurance attributable to
Management Company's Health Care Personnel assigned to or performing services
on a full-time basis at the UNIT, provided such costs are set forth in the
Annual Operating Plan, approved by The Cleveland Clinic Foundation, pursuant to
Section 3.2 hereof.
The Cleveland Clinic Foundation, at its expense, will provide
professional liability insurance coverage for the Medical Director of the UNIT
and for its other employees providing services to the UNIT hereunder.
7.4 The Cleveland Clinic Foundation, at its expense, shall provide
fire and extended coverage insurance with respect to the UNIT and its contents.
Management Company shall be named as an additional insured under such policy.
The Cleveland Clinic Foundation also shall obtain general liability insurance
coverage in a minimum amount of $1,000,000 per incident/$3,000,000 annual
aggregate with respect to its ownership of the UNIT. Management Company shall
obtain, at its expense, general liability insurance coverage in a minimum
amount of $1,000,000 per incident /$3,000,000 annual aggregate with respect to
its actions as manager of the UNIT.
Management Company shall procure and maintain workers' compensation
insurance meeting statutory requirements and employer liability insurance
coverage in commercially reasonable amounts with respect to the Management
Company's employees. The Cleveland Clinic Foundation shall reimburse
Management Company for that portion of the reasonable cost of such insurance
attributable to Management Company's Health Care Personnel assigned to or
performing services on a full-time basis at the UNIT, provided such costs are
set forth in the Annual Operating Plan, approved by The Cleveland Clinic
Foundation, pursuant to Section 3.2 hereof.
7.5 Management Company shall be solely responsible for the hiring,
compensation, termination and all matters relating to any persons, companies or
corporations employed by Management Company, for any reason whatsoever in
regard hereto, arising herefrom or otherwise, and shall indemnify and hold The
Cleveland Clinic Foundation harmless from any liability arising from the
employment by Management Company of any such persons or companies, including
any liability arising under the Civil Rights Act of 1964, as amended, the
Americans with Disabilities Act of 1990, the Age Discrimination in Employment
Act, and any other relevant federal, state, and local laws or regulations.
7.6 No individual whose compensation for services is paid by
Management Company shall be in any way, directly or indirectly, expressly or by
implication, deemed an employee of The Cleveland Clinic Foundation or any
related entity, nor shall any such individual, be deemed to be employed by The
Cleveland Clinic Foundation or any related
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entity for the purpose of any payroll taxes, income tax withholding, or
contributions imposed by any federal, state, or local law or regulations, with
respect to employment, workers' compensation, or otherwise. Management Company
accepts exclusive liability for any and all payroll taxes, income tax
withholding or contributions, in any form whatsoever, imposed by federal, state
or local law or regulations, not only with respect to itself, but also with
respect to any and all of its agents or employees.
VIII. TERM AND TERMINATION
8.1 Term. The term of this Agreement shall be one (1) year, unless
earlier terminated as hereinafter set forth. This Agreement may be terminated
at any time without cause by either: i) mutual written consent of the parties;
or ii) The Cleveland Clinic Foundation providing sixty (60) days prior written
notice to the Management Company.
8.2 Termination for Cause.
8.2.1 Bankruptcy Termination. Management Company may
terminate this Agreement upon the "bankruptcy" of The Cleveland Clinic
Foundation and The Cleveland Clinic Foundation may terminate this Agreement
upon the "bankruptcy" of Management Company, in each case upon written notice
thereof to the other party. As used in this Section, "bankruptcy" of a party
means: the filing of a petition commencing a voluntary case against it under
the Bankruptcy Code; a general assignment by it for the benefit of creditors;
its insolvency; its inability to pay its debts as they become due; the filing
by it of any petition or answer in any proceeding seeking for itself or
consenting to, or acquiescing in, any insolvency, receivership, composition,
readjustment, liquidation, dissolution, or similar relief under any present or
future statute, law, or regulation, or the filing by it of an answer or other
pleading admitting or failing to deny or to contest the material allegations of
the petition filed against it in any such proceeding; its seeking or consent
to, or acquiescence in the appointment of, any trustee, receiver, or liquidator
of it or any material part of its property; or the commencement against it of
any involuntary case under the Bankruptcy Code, or a proceeding under any
receivership, composition, readjustment, liquidation, insolvency, dissolution,
or like law or statute, which case or proceeding is not dismissed or vacated
within sixty (60) days from commencement.
8.2.2 Termination for Breach or Default. If either party
("Defaulting Party") fails substantially to perform any of its material
obligations under this Agreement, the other party ("Non-Defaulting Party")
shall have the right to give the Defaulting Party a "Notice of Default." The
Notice of Default shall set forth the nature of the obligation that the
Defaulting Party has not performed. If, within ten (10) business days
following the giving of the Notice of Default, the Defaulting Party in good
faith commences to cure the default, and thereafter diligently and continuously
pursues the curing to completion within thirty (30) days of such notice, unless
the default is impossible to cure within thirty (30) days, in which event the
defaulting party must continuously and diligently pursue a cure to completion
within a reasonable time, it shall be deemed that the Notice of Default has not
been given and the
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Defaulting Party shall not lose any of its rights under this Agreement by
reason thereof, although such Defaulting Party may be required to pay interest
relating to such default if so required by the terms of this Agreement. If,
within the ten (10) day notice period, the Defaulting Party does not commence
in good faith the curing to the default or does not thereafter diligently and
continuously prosecute and achieve the curing to completion within the
applicable cure period, the Non-Defaulting Party shall have the right to
terminate this Agreement upon ten (10) days' written notice to the Defaulting
Party.
8.3 Rights Upon Termination.
8.3.1 The right to terminate this Agreement shall be in
addition to any other remedy available on account of any breach or default.
8.3.2 Upon termination of this Agreement for any reason, and
notwithstanding Section 8.2 hereof, Management Company shall, for a period not
to exceed ninety (90) days, assist The Cleveland Clinic Foundation in effecting
an orderly transfer of all of its management functions, including, without
limitation, billing, collections, and maintenance of data, so as to prevent or
minimize disruption of the UNIT's operations. In addition, upon prior
consultation with Management Company, The Cleveland Clinic Foundation shall have
the right to solicit all non-officer Management Company employees in the event
of a termination by Management Company hereunder. Such assistance shall be
rendered in a manner consistent with usual and customary practice and The
Cleveland Clinic Foundation's needs.
IX. MISCELLANEOUS
9.1 Assignment. This Agreement shall not be assigned by either
party without the prior written consent of the other party.
9.2 Further Documents. The parties do hereby covenant and agree
that they and their successors and assigns will execute any and all
instruments, releases, assignments, and consents which may reasonably be
required of them in order to carry out the provisions of this Agreement.
Notwithstanding expiration or termination of this Agreement, each party hereto
shall take such further actions as are necessary to fulfill its existing
obligations, including those in Section 3.2, Section 6.1, and Article X.
9.3 Effect on Successors. Without in any way limiting the
provisions of Section 9.1, this Agreement shall be binding upon, enforceable by,
and inure to the benefit of the parties and their permitted successors and
assigns.
9.4 Entire Agreement. This Agreement contains the entire agreement
between the parties relating to the subject matter of this Agreement. The
terms of this Agreement may be modified or amended only by a writing signed by
all parties.
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9.5 Governing Law. This Agreement shall be governed by and
construed, interpreted, and enforced pursuant to the laws of the State of Ohio.
9.6 Notices. All notices under this Agreement by any party to the
other shall be in writing. All notices, demands, and requests shall be deemed
given when mailed, postage prepaid, registered or certified mail, return
receipt requested, or sent by prepaid express delivery service:
(a) TO: The Cleveland Clinic Foundation
0000 Xxxxxx Xxxxxx; Xxxx X-000
Xxxxxxxxx, Xxxx 00000
Attention: Xx. Xxxxxxx Xxxxxx
With copies to:
General Counsel; Desk H-18
(b) TO: Renal Care Group, Inc.
University Division
0000 Xxxx Xxx Xxxxxx, Xxxxx 0000
Xxxxxxxxx, XX 00000
Attention: Xxxxxxxx Xxxx, Vice President
With copies to Xxxxxx Xxxxxxxx, Esq.
Fares, Xxxxxxxx & Xxxxxxx
17th Floor
Third National Bank Building
000 Xxxxxx Xxxxxx, Xxxxx
Xxxxxxxxx, XX 00000
9.7 No Waiver. The future of any party to insist at any time upon
the strict observance or performance of any of the provisions of this Agreement
shall not impair any such right or remedy or be construed to be a waiver or
relinquishment. Every right and remedy given by this Agreement to the parties
may be exercised from time to time and as often as may be deemed expedient by
the parties.
9.8 Enforceability, Severability. The invalidity or
unenforceability of any term or provision of this Agreement shall not, unless
otherwise specified, affect the validity or enforceability of any other term or
provision, unless the term or provision is material and its invalidity or
unenforceability results in a substantial economic detriment to The Cleveland
Clinic Foundation or Management Company, in which event the parties hereto
shall negotiate in good faith a resolution which to the maximum extent feasible
preserves to each party the right and benefits contemplated hereunder.
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9.9 Confidentiality. Each party hereto covenants and agrees that
it shall not disclose the terms of this Agreement or any agreement
supplementing this Agreement to third parties, except as and to the extent
disclosure is required by law, or required for the performance of its
obligations hereunder or under related agreements, or as necessary or
appropriate in dealing with the accountants, attorneys, and other
representatives of the respective parties.
9.10 Medicare Access to Books and Records. In the event, and only
in the event, that Section 952 of P.L. 96-499 [(42 U.S.C. Section 1395 x
(v)(1)(1)] is applicable to this Agreement, each party agrees as follows:
a. Until the expiration of four (4) years after the
furnishing of such services pursuant to this Agreement, each party shall make
available, upon written request, to the Secretary of the Federal Department of
Health and Human Services or, upon request to the Comptroller General of the
United States, or any of its duly authorized representatives, this Agreement,
and books, documents and records of each party that are necessary to certify
the nature and extent of the cost of services provided pursuant to this
Agreement; and
b. If any party carries out any of the duties of this
Agreement through a subcontract, with a value or cost of Ten Thousand Dollars
($10,000) or more over a twelve (12) month period, with a related organization,
such subcontract shall contain a clause to the effect that until the expiration
of four (4) years after the furnishing of such services pursuant to such
subcontract, the related organization shall make available, upon written
request, to the Secretary of the Federal Department of Health and Human
Services or, upon request, to the Comptroller General of the United States, or
any of its duly authorized representatives, the subcontract, and books,
documents and records of such organization that are necessary to verify the
nature and extent of the cost of services provided pursuant to such
subcontract;
c. Each party shall notify the other parties immediately
of any request for access to books and records described above. In addition,
each party shall indemnify, defend and hold the other party harmless from any
liability arising out of any refusal by the refusing party or its
subcontractors to grant access to books and records as required above.
9.11 Resolution of Disputes/Binding Arbitration. In the event that
a dispute, the resolution of which is not already provided herein, arises
between the Management Company and The Cleveland Clinic Foundation, the parties
agree that such dispute shall first be submitted to the Chief Executive
Officers of both parties. If such dispute is not resolved to the parties'
satisfaction, said dispute shall be submitted to a panel of arbitrators in
Cleveland, Ohio, who shall be governed the rules of the American Arbitration
Association and whose decision shall be binding and conclusive on the parties.
Costs associated with such arbitration shall be borne proportionate to the
arbitrators' finding of fault.
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X. GOVERNMENTAL APPROVALS
The Management Group and The Cleveland Clinic Foundation acknowledge
that they have, in good faith, made reasonable efforts to comply with any
applicable restrictions under the laws of the United States of America or the
State of Ohio with respect to the practice of medicine and relationships
between physicians and management companies. In the event that: (a) any
applicable licensing, administrative or governmental agency, authority or
office, or any court of competent jurisdiction finds, pursuant to a final
nonappealable determination or order, that any aspect of this Agreement or any
transaction contemplated by this Agreement does or may violate applicable
prohibitions or restrictions with respect to the practice of medicine by
unlicensed persons or relationships between management corporations and
physicians; or (b) any party to this Agreement has reasonable belief that such
findings may be made, then the Management Company and The Cleveland Clinic
Foundation shall use their best efforts to reform or reorganize the structure
of their relationship described in this Agreement so that such violation or
alleged violation no longer exists; provided, however, that notwithstanding
such efforts and reformation or reorganization, in the event of (a) above,
either party may elect to terminate this Agreement by proving sixty (60) days
prior written notice, and upon such termination, neither party shall have any
liability to the other party with respect to this Agreement except incurred
prior to termination or with respect to such violation or alleged violation to
the extent that Hospital and Foundation restructure or reorganize their
relationship, they shall do so to preserve to the greatest extent possible the
economic relationship between them.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first above written.
THE CLEVELAND CLINIC FOUNDATION RENAL CARE GROUP, INC.
By: /s/ Xxxxx X. Xxxxxxxx By: /s/
---------------------------- --------------------------------
XXXXX X. XXXXXXXX
Title: CHIEF OPERATING OFFICER Title: Chief Medical Officer
------------------------ Director, University Division
Renal Care Group
--------------------------------
APPROVED AS TO FORM
COF - Office of
General Counsel
By /s/ Xxxxxx X. Xxxxx
---------------------------
Date 3/17/96
-------------------------
--------------------------------
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EXHIBIT A
EXCLUSIVE SERVICE AREA
CUYAHOGA, LAKE, SUMMIT, GEAUGA, LORAIN, HURON AND ERIE COUNTIES
15
