SUBMANAGMENT AGREEMENT
THIS SUBMANAGEMENT AGREEMENT ("Agreement") is dated January 1, 2005, by
and between Reproductive Partners, Inc., a Delaware corporation, with its
principal place of business at 000 Xxxxx Xxxxxxxx Xxxxxx, Xxxxx 000, Xxxxxxx
Xxxxx, Xxxxxxxxxx 00000 ("RPI") and IntegraMed America, Inc., a Delaware
corporation with a principal place of business at Two Xxxxxxxxxxxxxx Xxxx,
Xxxxxxxx, Xxx Xxxx 00000 ("IntegraMed").
WITNESSETH THAT:
WHEREAS, RPI and Reproductive Partners Medical Group, Inc., with a
place of business at 000 Xxxxx Xxxxxxxx Xxxxxx, Xxxxx 000, Xxxxxxx Xxxxx,
Xxxxxxxxxx 00000 ("RPMG") have entered into a certain First Amended Management
Services and Facility Agreement (the "Management Agreement") dated January 1,
2005 and attached hereto as Exhibit A, whereby RPMG has retained the services of
RPI to perform management, services and administrative functions, on its behalf,
relating to its medical practice and the provision of Infertility Services, as
such term is defined in the Management Agreement; and
WHEREAS, pursuant to the Management Agreement, the RPI will be
responsible for provision of all management obligations as set forth in the
Management Agreement, and
WHEREAS, IntegraMed is engaged in the business of furnishing management
services to medical practices specializing in the provision of Infertility
Services; and
WHEREAS, RPI desires to obtain the services of IntegraMed to perform
certain of its duties as contained in the Management Agreement (the
"Submanagement Services"); and
WHEREAS, IntegraMed has offered to provide the Submanagement Services
to RPI on the basis, terms and conditions set forth in this Agreement.
Capitalized terms used herein and not otherwise defined shall have the meaning
given to them in the Management Agreement.
NOW, THEREFORE, in consideration of the foregoing and of the full and
faithful performance of all the terms, conditions, and obligations herein
contained, and intending to be legally bound hereby, RPI and IntegraMed agree as
follows:
1. TERM. Unless otherwise terminated as provided herein, the term of
this Agreement shall commence on January 1, 2005 (the "Commencement Date") and
end December 29, 2029 (the "Term").
2. FEES. RPI shall pay IntegraMed a monthly management fee during the
Term (hereinafter called the "Management Fee") equal to the sum of (a) the Cost
of Services (as defined in the Management Agreement) that IntegraMed incurs on
RPI's behalf, (b) the Base Management Fee (as defined in the Management
Agreement) paid by RPMG to RPI under the Management Agreement, plus (c) ninety
percent (90%) of the Additional Service Fee (as defined in the Management
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Agreement) paid by RPMG to RPI under the Management Agreement. Such Management
Fee shall be paid without set-off or deduction within three (3) business days
after RPI receives its Compensation from RPMG under the terms of the Management
Agreement.
2.1 In addition to any other Cost of Services, as defined in
the Management Agreement, RPMG shall reimburse IntegraMed for RPMG's
allocable portion of a third-party vendor invoice for a product or
service offered through the IntegraMed FertilityPartner network which
is utilized by RPMG in its sole discretion and based on RPMG's actual
volume related usage for or of the particular product or service
without any charge for IntegraMed's Overhead related to the product or
service.
3. SERVICES TO BE PROVIDED, OBLIGATIONS AND COMMITMENTS.
3.1 IntegraMed shall provide such services to be provided by the RPI
under the Management Agreement as requested by the RPI. In providing its
services under this Agreement, IntegraMed shall be subject to all the terms
covenants and conditions in the Management Agreement, in addition to those set
forth herein, including but not limited to the exclusivity provisions contained
in Section 3.1.1 of the Management Agreement. The termination of the Management
Agreement for any reason whatsoever shall cause an automatic and contemporaneous
termination of this Submanagement Agreement. RPI represents and warrants that as
of the Commencement Date it is not in default of any provisions of the
Management Agreement.
3.1.1 Section 1.1.11 of the Management Agreement is hereby
deleted in its entirety and the following is hereby substituted therefor:
"Section 1.1.11 "RPI Overhead" shall mean salaries, bonuses,
payroll taxes and benefits for IntegraMed corporate office
employees, rent and expenses related to the operation of the
IntegraMed's corporate office, travel and entertainment
expenses for corporate employees and expenses related to the
status of RPI's shareholder, IntegraMed, as a publicly-held
corporation."
3.2 IntegraMed shall make available to RPMG the services as described
in the Management Agreement and the "INTEGRAMED RESOURCES, PRODUCTS AND SERVICES
TO PARTNER PRACTICES," attached as Exhibit 3.2, as modified from time to time.
Additionally, such other services as IntegraMed may from time to time make
available to its network of infertility practitioners shall be made available to
RPMG. IntegraMed reserves the right to alter, modify or cease any service;
provided, however, there is no material alteration of RPMG's ability to continue
its business in a manner substantially similar to operations prior to the
decision to alter, modify or cease any Service. IntegraMed will provide those
business services described in Exhibit 3.2 which are part of IntegraMed's
Overhead and for which value is attributed as part of the services described
therein, at no additional cost to RPMG. Other services described in Exhibit 3.2
which are not included within IntegraMed's Overhead, shall be provided, at
RPMG's request, as a Cost of Services to RPMG.
3.3 In case of any breach or default of this Submanagement Agreement by
IntegraMed, RPI shall have the same rights against IntegraMed as would be
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available to RPMG against RPI under the Management Agreement if such breach were
by RPI thereunder. IntegraMed will duly and faithfully observe all the terms and
restrictions and perform all the obligations imposed upon RPI under the
Management Agreement.
3.4 IntegraMed shall not do or permit anything to be done which would
cause the Management Agreement to be terminated or forfeited by reason of any
right of termination or forfeiture reserved or vested in RPMG under the
Management Agreement.
3.5 IntegraMed shall keep and maintain all insurance required of RPI
pursuant to the Management Agreement, on the terms and as provided in the
Management Agreement, naming RPI and RPMG as additional insureds.
3.6 RPMG agrees to (i) participate in the IntegraMed's network
activities and programs, including, but not limited to, the Council of
Physicians and Scientists, (ii) use best efforts in offering IntegraMed
Pharmaceutical Services to RPMG patients, (iii) use best efforts in offering the
Shared Risk Refund Program to RPMG patients, and participating in other product
and service offering IntegraMed has in effect from time to time, unless RPMG
believes it not to be in the best medical interests of RPMG patients to offer
such products and services.
4. LICENSE OF INTEGRAMED TRADEMARKS
4.1 GRANT OF LICENSE. IntegraMed hereby grants to RPMG a revocable,
non-exclusive and non-assignable license for the term of this Agreement to use
the names Reproductive Science Center(R), Shared Risk(TM), Artworks(R),
IntegraMed(R), the IntegraMed Network(TM) and a revocable, non-exclusive and
non-assignable license with respect to any other service names, acquired or
developed names, trademark names and logos of IntegraMed (the "Trade Names") in
conjunction with the provision of Infertility Services by RPMG within the
Territory. The use of such Trade Names shall be within the discretion of RPMG,
except that RPMG agrees to use the phrases "a member of the IntegraMed Network"
or "an IntegraMed affiliate" in connection with its marketing materials,
letterheads, business cards, etc.
4.2 FICTITIOUS NAME PERMIT. If necessary, RPMG shall file or cause to
be filed an original, amended or renewal application with an appropriate
regulatory agency to obtain a fictitious name permit which allows RPMG to
practice at its Facilities under the Trade Names and shall take any other
actions reasonably necessary to procure protection of or protect IntegraMed's
rights to the Trade Names. IntegraMed shall assist RPMG in obtaining any such
original, amended or renewal fictitious name permit.
4.3 RIGHTS OF INTEGRAMED. RPMG acknowledges IntegraMed's exclusive
right, ownership, title and interest in and to the Trade Names and will not at
any time do or cause to be done any act or thing contesting or in any way
impairing or tending to impair any part of such right, title and interest. In
connection with the use of the Trade Names, RPMG shall not in any manner
represent that it has any ownership interest in the Trade Names, and RPMG's use
shall not create in RPMG's favor any right, title, or interest in or to the
Trade Names other than the right of use granted hereunder, and all such uses by
RPMG shall inure to the benefit of IntegraMed. RPMG shall notify IntegraMed
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immediately upon becoming aware of any claim, suit or other action brought
against it for use of the Trade Names or the unauthorized use of the Trade Names
by a third party. RPMG shall not take any other action to protect the Trade
Names without the prior written consent of IntegraMed. IntegraMed, if it so
desires, may commence or prosecute any claim or suit in its own name or in the
name of RPMG or join RPMG as a party thereto. RPMG shall not have any rights
against IntegraMed for damages or other remedy by reason of any determination of
IntegraMed not to act or by reason of any settlement to which IntegraMed may
agree with respect to any alleged infringements, imitations or unauthorized use
by others of the Trade Names, nor shall any such determination of IntegraMed or
such settlement by IntegraMed affect the validity or enforceability of this
Agreement.
4.3.1 IntegraMed will defend, indemnify, and hold RPMG harmless from
any claim, suit, action or expense (including reasonable attorney's
fees) alleging that RPMG's use of the Trade Names infringe or violate
any rights of third parties.
4.4 RIGHTS UPON TERMINATION.
4.4.1 Upon termination of this Agreement, RPMG shall within 30
days of the termination (i) cease using the Trade Names in all respects
and refrain from making any reference on its letterhead, consents or
other information or material to its former relationship with
IntegraMed and (ii) return to IntegraMed all Proprietary Materials as
defined herein including, but not limited to, consents, policy and
procedure manuals, Risk Management and Clinical Standards Review
Manuals. Additionally RPMG will take any and all actions required to
make the Trade Names available for use by any other person or entity
designated by IntegraMed.
4.4.2 RPMG's failure (except as otherwise provided herein) to
cease using the Trade Names at the termination or expiration of this
Agreement will result in immediate and irreparable damage to IntegraMed
and to the rights of any licensee of IntegraMed. There is no adequate
remedy at law for such failure. In the event of such failure,
IntegraMed shall be entitled to equitable relief by way of injunctive
relief and such other relief as any court with jurisdiction may deem
just and proper. Additionally, pending such a hearing and the decision
on the application for such permanent injunction, IntegraMed shall be
entitled to a temporary restraining order relating to RPMG's failure to
cease using the Trade Names, without prejudice to any other remedy
available to IntegraMed. All such remedies hereunder shall be at the
expense of RPMG and shall not be a Cost of Services.
5. ACCOUNTS RECEIVABLES. RPMG acknowledges and understands that
IntegraMed's bank has a security interest in RPMG's accounts receivable
purchased by IntegraMed in connection with the Management Agreement. In that
connection, IntegraMed's bank requires that the various medical practices with
which IntegraMed enters into an agreement, executes and delivers to such bank a
Continuing General Limited Security Agreement in the form of Exhibit 5 attached
hereto, which RPMG has executed and delivered to IntegraMed.
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6. INDEMNIFICATION.
6.1. RPI does hereby indemnify and hold harmless IntegraMed
from and against any loss, cost, claim, damage, liability or expense, including
reasonable attorneys' fees which IntegraMed may suffer, incur, or expend arising
out of any failure on the part of RPI to perform fully any of its obligations
hereunder.
6.2. IntegraMed does hereby indemnify and hold harmless RPI
from and against any loss, cost, claim, damage, liability or expense, including
reasonable attorneys' fees, which RPI may suffer, incur, or expend arising out
of any failure on the part of IntegraMed to perform fully any of its obligations
hereunder.
7. NOTICES. In every instance in which notice is required or permitted
to be given hereunder, such notice shall be in writing and personally delivered
or sent by overnight courier service for next day delivery, or by certified
mail, return receipt requested, postage prepaid, addressed as follows:
If to RPI: Reproductive Partners, Inc.
Attention: President
000 Xxxxx Xxxxxxxx Xxxxxx
Xxxxx 000
Xxxxxxx Xxxxx, XX 00000
If to IntegraMed: IntegraMed America, Inc.
Attention: Xxxxxxx Xxxxx, CEO
Two Xxxxxxxxxxxxxx Xxxx
Xxxxxxxx, Xxx Xxxx 00000
If to RPMG: Reproductive Partners Medical Group, Inc.
Attention: Xxxxx Xxx, M.D., President
000 Xxxxx Xxxxxxxx Xxxxxx
Xxxxx 000
Xxxxxxx Xxxxx, XX 00000
All notices sent by mail, as described above, shall be deemed given the
second regular business day after the same are posted. Notices personally
delivered or sent by overnight mail courier service shall be deemed given on the
day received. Either party may change the address to which notices to it are to
be sent by providing written notice of such new address to the other party, as
described above.
8. MISCELLANEOUS
8.1. This Agreement may not amended except by a written
instrument signed and delivered by the parties hereto.
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8.2. This Agreement constitutes the entire understanding
between the parties hereto with respect to the subject matter hereof, and all
other agreements relating to the subject matter hereof are hereby superseded.
8.3. This Agreement shall be governed by, and construed in
accordance with, the laws of the State of California.
8.4. Nothing contained in this Agreement shall be construed to
create a joint venture, partnership, association, employer-employee or other
affiliation or like relationship between the parties.
8.5 Reproductive Partners Medical Group, Inc. shall be a
express third party beneficiary of this Agreement and shall have the right to
enforce this Agreement as a third party beneficiary.
IN WITNESS WHEREOF, the parties hereto have caused this Submanagement
Agreement to be properly executed, under seal, as of the day and year first
above written.
Reproductive Partners, Inc.
By: /s/Xxx Xxxxxx
------------------------
Xxx Xxxxxx, President
IntegraMed America, Inc.
By: /s/Xxx Xxxxxx
------------------------
Xxx Xxxxxx, President
CONSENT AND AGREEMENT
The undersigned hereby consents to this Agreement pursuant to Section 3.11 of
the Management Agreement and agrees to be bound by Sections 2.1, 3.1.1, 3.2,
3.6, 4.1 through 4.4.2 and 5 of this Agreement.
Reproductive Partners Medical Group, Inc.
By: /s/Xxxxx Xxx
-----------------------------
Xxxxx Xxx, M.D., President
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Exhibit 3.2
IntegraMed Resources, Products and Services to Partner Practices
[Attached]
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Exhibit 5
Continuing General Limited Security Agreement
[Attached]
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