Exhibit 10.12.4
ADDENDUM TO BLUE CROSS CONTROLLED AFFILIATE LICENSE AGREEMENT
This Blue Cross Controlled Affiliate License Agreement
is made by and among Blue Cross and Blue Shield Association
("BCBSA") and Healthy Alliance Life Insurance Company (the
"Controlled Affiliate"), a Controlled Affiliate of the Blue Cross
Plan(s) known as Blue Cross and Blue Shield of Missouri (the
"Plan"), which is also a Party signatory hereto.
Preamble
WHEREAS, BCBSA is the owner of the BLUE CROSS and the
BLUE CROSS Design service marks (collectively the "Licensed
Marks");
WHEREAS the Controlled Affiliate was given the right to
use the Licensed Marks as service marks for health care plans in
its service area and the right to use BLUE CROSS in its trade
name (the "Licensed Name");
WHEREAS, BCBSA has informed the Controlled Affiliate
that the Controlled Affiliate's Blue Cross Controlled Affiliate
License Agreement automatically terminated pursuant to paragraph
7.B. of that Controlled Affiliate License Agreement, as a result
of an order entered by the Circuit Court of Xxxx, County,
Missouri dated October 29, 1998 (the "Missouri Order") in certain
litigation pending among and between the Plan, the Missouri
Department of Insurance, and the Attorney General of the State of
Missouri (the "Litigation");
WHEREAS, the Controlled Affiliate has informed BCBSA
that: (i) the Controlled Affiliate believes that because the
Missouri Order was void and was vacated as void ab initio six
days after it was entered, it was not effective and did not
result in the automatic termination of the Controlled Affiliate's
Blue Cross Controlled Affiliate License Agreement; (ii) the
Controlled Affiliate contends that its Blue Cross Controlled
Affiliate License Agreement remains in effect; and (iii) to avoid
the expense and delay of litigation and to clarify its right to
continue to use the Licensed Marks and Licensed Name, the
Controlled Affiliate is willing to accept benefits and rights
under this Addendum to Blue Cross Controlled Affiliate License
Agreement;
WHEREAS, BCBSA has determined that it is in the best
interest of the Licensed Marks, BCBSA, and its member Plans to
grant the Controlled Affiliate a Blue Cross Controlled Affiliate
license pursuant to the terms of the Blue Cross Controlled
Affiliate License Agreement as amended by this Addendum to Blue
Cross Controlled Affiliate License Agreement;
NOW THEREFORE, in consideration of the foregoing and
the mutual agreements hereinafter set forth and for other good
and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the parties agree as follows:
Addendum
1. BCBSA hereby grants the Controlled Affiliate, upon
the terms, covenants, and conditions of the Blue Cross Controlled
Affiliate License Agreement attached hereto (the "Full Affiliate
License") as amended by this Addendum to Blue Cross Controlled
Affiliate License Agreement ("Addendum"), the right to use the
Licensed Name in its trade name and the right to use the Licensed
Marks in the sale, marketing, and administration of health care
plans and related services in its licensed service area.
Notwithstanding any provision to the contrary in the Full
Affiliate License, paragraphs 1 through 8 of this Addendum shall
control to the extent they conflict with any terms, conditions,
or covenants of the Full Affiliate License. The term "Agreement"
as used in the Full Affiliate License shall be construed to
include this Addendum.
2. The Controlled Affiliate releases any and all
claims, causes of action, actions, suits, or any demands
whatsoever against BCBSA or any of its Member Plans, whether at
law or equity, whether in judicial, arbitral, or alternative
fora, and whether known or unknown, that the Controlled Affiliate
now has or may have had on behalf of itself or any other person
or entity at any time prior to and including the date hereof, or
hereafter can, shall, or may have or claim to have, arising out
of or in any way related to the aforementioned alleged automatic
termination.
3. BCBSA releases any and all claims, causes of
action, actions, suits, or any demands whatsoever against the
Controlled Affiliate, whether at law or equity, whether in
judicial, arbitral, or alternative fora, and whether known or
unknown, that BCBSA now has or may have had on behalf of itself
or any other person or entity at any time prior to and including
the date hereof, or hereafter can, shall, or may have or claim to
have, arising out of or in any way related to the aforementioned
alleged automatic termination.
4. The Controlled Affiliate warrants that, apart from
the Litigation, it is in compliance with all, and has no plans to
engage in conduct that would violate any, BCBSA rules and
regulations, including all provisions of this Addendum. The
Controlled Affiliate warrants that there is no imminent risk of
dissolution of the Controlled Affiliate or of the appointment of
a trustee, interim trustee, receiver, or other custodian for any
of the Controlled Affiliate's business or property. The
Controlled Affiliate shall immediately provide BCBSA's General
Counsel with copies of all pleadings and orders in the Litigation
upon receipt and shall regularly update BCBSA's General Counsel
on the Litigation. If at any time after the effective date of
this Addendum the Controlled Affiliate becomes aware of any event
that indicates that the Controlled Affiliate is in imminent
danger of dissolution, the Controlled Affiliate shall immediately
notify BCBSA's General Counsel in writing.
5. All disputes related to the termination of the
Controlled Affiliate's licenses shall be adjudicated exclusively
in a United States District Court, or if that Court does not have
subject matter jurisdiction, in a Court with competent
jurisdiction in Illinois. The Controlled Affiliate shall not
claim that a Court in Illinois lacks personal jurisdiction over
the Controlled Affiliate concerning any such dispute, nor that a
Court in Illinois is an improper or inconvenient venue for any
such dispute.
6. The provisions of paragraphs 7.G. and 7.H.(1) of
the Full Affiliate License related to notice to customers, and
the provisions of paragraph 7.H.(3) of the Full Affiliate License
related to the reestablishment fee, shall not apply to the
alleged automatic termination triggered by the Missouri Order.
The BCBSA Board of Directors' March 12, 1998 resolution relating
to the Controlled Affiliate's licenses is superseded by the terms
of the Full Affiliate License as amended by this Addendum,
provided, however, that paragraph 7.E.(3)(vii) of the Full
Affiliate License shall not apply with respect to the Litigation
and is superseded by paragraph 8 of this Addendum.
7. The Full Affiliate License as amended by this
Addendum shall automatically terminate upon any judicial act
which: (i) provides that, or approves a transaction pursuant to
which, a person, entity or group other than licensees of BCBSA,
acquires the ability to select the majority of the members of the
Board of Directors of the Controlled Affiliate or otherwise gains
control of the Controlled Affiliate; or (ii) changes the
composition, or the voting rights of the members, of the Board of
Directors of the Controlled Affiliate. This paragraph shall not
apply to a settlement or resolution of the Litigation that
complies with all BCBSA rules, regulations, and standards and is
approved by or conditioned on the approval of BCBSA.
8. The Full Affiliate License as amended by this
Addendum shall automatically terminate on March 11, 1999, unless
the BCBSA Board of Directors takes affirmative action to extend
the license on or before the scheduled Board meeting on March 11,
1999.
9. The Full Affiliate License as amended by this
Addendum shall be deemed effective as of October 29, 1998.
IN WITNESS HEREOF, the parties have caused the Full Affiliate
License as amended by this Addendum to Blue Cross Controlled
Affiliate License Agreement to be executed, effective October 29,
1998:
BLUE CROSS AND BLUE SHIELD ASSOCIATION:
By: /s/ XXXXX X. SEROTO
Title: EXECUTIVE VICE PRESIDENT & COO
Date: NOVEMBER 19, 1998
HEALTHY ALLIANCE LIFE INSURANCE COMPANY
By: /s/ XXXX X'XXXXXX
Title: PRESIDENT
Date: NOVEMBER 19, 0000
XXXX XXXXX XXX XXXX XXXXXX XX XXXXXXXX
By: /s/ XXXX X'XXXXXX
Title: PRESIDENT
Date: NOVEMBER 9, 1998
