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EXHIBIT 10.23
AGREEMENT FOR MEDICAL DIRECTORSHIP
THIS AGREEMENT is made this 1st day of April, 1992, by and between
SmithKline Xxxxxxx Clinical Laboratories, Inc., a Delaware corporation, with a
principal office located at 0000 Xxxx Xxxxxx Xxxxxx, Xxxxx, Xxxxxxx 00000
("SBCL") and Xxxxxxx and Associates Pathology, P.A., a professional corporation
organized under the laws of the state of Florida with a principal office
located at 0000 Xxxxxxxxxx Xxxxx, Xxxxx 000, Xxxxxxx, Xxxxxxx 00000
("Association").
WITNESSETH
WHEREAS, SBCL is a corporation organized under the laws of the state of
Delaware which owns and operates or manages clinical laboratories or provides
laboratory services, management support and reference testing to laboratories
which perform various tests for the purpose of providing information for the
diagnosis, prevention or treatment of disease or the assessment of medical
conditions; and
WHEREAS, Association is a professional corporation organized under the
laws of the state of Florida, which employs physicians who are duly licensed to
practice medicine in the state of Florida and specialists that are Board
Certified in the fields of anatomic and clinical pathology; and
WHEREAS, SBCL owns a laboratory facility located at 0000 Xxxxxxxx
Xxxxxx, Xxxxxxx, Xxxxxxx 00000 (the "Laboratory") for which professional
pathology services and medical director services are needed from time to time
to ensure its proper operation; and
WHEREAS, SBCL desires to contract with Association for the provision by
Association of clinical pathology and medical director services to the
Laboratory and to compensate Association therefor; and
WHEREAS, Association desires to provide clinical pathology and medical
director services to SBCL; and
WHEREAS, Association and SBCL desire to provide a statement of their
respective rights, obligations and duties in connection with the performance of
services hereunder.
NOW, THEREFORE, in consideration of the foregoing and of the mutual
covenants and agreements herein contained, and intending to be legally bound
hereby, the parties agree as follows:
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A. RESPONSIBILITIES OF ASSOCIATION
1. Medical Director. Association agrees to make available to
the Laboratory the services of a qualified pathologist, who shall be designated
by Association (subject to SBCL's approval and consent), to perform the duties
of Medical Director of the Laboratory ("Medical Director") and qualified
substitutes on a temporary basis when the appointed Medical Director of that
facility is temporarily absent. If Association is unable to designate a
qualified pathologist who meets with SBCL's approval to act as a replacement or
substitute Medical Director for the Laboratory, SBCL may terminate this
Agreement as set forth in paragraph D 2 hereof. Said Medical Director will
initially be on-site at the Laboratory a minimum of four (4) hours per week.
As the testing activities of the Laboratory increase, the number of hours
on-site shall be increased accordingly as agreed by Association and SBCL.
2. Responsibilities of Medical Director.
a. Director of Laboratory. Medical Director shall act as
Director of the Laboratory and shall be responsible for the administration of
all technical and scientific operations of the Laboratory, including
supervision of testing procedures and result reporting. Medical Director shall
be responsible for ensuring that the Laboratory is in compliance with all
applicable local, state and federal laws, rules and regulations.
b. Quality Assurance. Medical Director will be a
participating member of SBCL's Quality Assurance Committee, which includes
participating in national quality assurance assignments at SBCL's request.
Each week Medical Director will devote at a minimum thirty percent (30%) of
Medical Director's on-site time at the Laboratory to qualify assurance matters.
3. Additional Professional Services. At such time as SBCL
requires professional pathology services and medical direction for any
additional laboratory or laboratories which SBCL owns or provides management
support in the Florida counties of Brevard, Orange, Osceola, Seminole, Indian
River, Lake, Okeechobee, St. Lucie and Volusia, Association agrees to provide
clinical pathology services and a medical director (subject to SBCL's approval
and consent) upon the request of SBCL, unless the parties mutually agree that
Association need not perform these additional services. Additional
compensation for such services will be negotiated in good faith as required.
SBCL retains the right to choose the pathology group and medical director for
the additional laboratory or laboratories at its sole discretion.
4. Nondisclosure of Proprietary Information.
a. Proprietary Information. Association acknowledges
that this Agreement creates a relationship of confidence and trust
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between the parties with respect to any information disclosed by SBCL to
Association during the course of this Agreement including, but not limited to,
secret processes, formulas, trade secrets, techniques, inventions (whether or
not patentable) and know-how (hereinafter collectively called "proprietary
information"). Association agrees to hold such proprietary information
communicated to it by SBCL and documents containing it such as customer lists,
specifications, sales and service manuals, samples and correspondence, in trust
and confidence at all times during the term of this Agreement and after its
termination and will refrain from using or disclosing any such proprietary
information except when acting pursuant to this Agreement.
b. Nondisclosure. All proprietary information received from SBCL
either prior to this Agreement or during its existence shall remain the
property of SBCL, shall be treated as proprietary by Association, shall be
treated with the same degree of care with which Association treats its own
proprietary information, and shall not be divulged or disclosed to others
except with the prior written consent of SBCL. Association agrees that it will
not, without prior written consent of SBCL, communicate proprietary information
to any person or organization other than to those of Association's partners,
associates, employees, agents or representatives to whom it shall be necessary
to disclose it in order to carry out the purposes of this Agreement.
Association agrees to use its best efforts to prevent its partners, associates,
employees, agents or representatives from disclosing any proprietary
information to any other person or organization. Association will promptly
return all such proprietary information provided in written form upon the
written demand therefor by SBCL.
c. Exceptions. The provisions of this paragraph 4 shall not apply to
the extent (i) the information is in the public domain or is publicly known,
(ii) the Association obtains said information from a third party who is not
under any duty of confidentiality, (iii) any disclosure is made with the
consent of SBCL or is otherwise required in order for the Association to
fulfill its duties and obligations under this Agreement, or (iv) the
Association is compelled to do so by legal process or the disclosure is
otherwise required by applicable law.
B. RESPONSIBILITIES OF SBCL
1. Fees. SBCL shall pay Association for the professional services
rendered Twenty-four Thousand Dollars ($24,000.00) per year. Such fee-for
service remuneration shall be paid in equal monthly installments of Two
Thousand Dollars ($2,000.00) per month on the last day of each month following
the month in which services have been provided by Association hereunder. The
installments must at all times, comply with all applicable laws, rules,
regulations and contractual arrangements with third-party payors.
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2. Nonsolicitation. During the term of this Agreement and any
renewals thereof and continuing for a period of one (1) year following
expiration, nonrenewal or termination of this Agreement, SBCL agrees not to
solicit directly or indirectly the services, including employment or consulting
agreements, of any person employed by Association without the consent of
Association which consent shall not be unreasonably withheld.
C. PROFESSIONAL LIABILITY INSURANCE AND NOTICE
1. Professional Liability Insurance Coverage. Each party shall obtain
and maintain at its own expense respectively, professional liability insurance,
or in the case of SBCL only self-insurance, in the minimum amount of One
Million Dollars ($1,000,000) per claim/occurrence and Three Million Dollars
($3,000,000) in the aggregate to cover said party for any and all liability it
may have with respect to the provision of services pursuant to this Agreement
or with respect to its responsibilities hereunder.
2. Notice. Each party hereto shall promptly notify the other in
writing of any claim asserted against the other party, or any of either party's
employees, agents, servants or representatives, relating to the services
provided under this Agreement or the responsibilities hereunder, and further
shall promptly deliver to the other party a true copy of any such claim
including, but not limited to, a true copy of any summons or other process,
pleading or notice issued in any lawsuit or other proceeding to assert or
enforce any such claim.
D. TERM AND TERMINATION
1. Initial Term and Renewal. This Agreement shall commence on the 1st
day of April, 1992 and shall remain in effect for an initial term of one (1)
year. Thereafter, this Agreement shall automatically renew for successive
terms of three (3) years subject to all terms and conditions herein contained
(except that the installments provided for in paragraph B.1, above, are subject
to review and adjustment on an annual basis), unless and until either the
Association or SBCL shall give the other party written notice not less than
ninety (90) days prior to expiration of the then current term of its intention
to terminate this Agreement as of the expiration of the initial or any
subsequent yearly term.
2. Termination. This Agreement will immediately and automatically
terminate on and as of the date any of the following to occur:
a. Default. Failure of either party to comply with any of the
material terms of this Agreement after thirty (30) days written notice of such
failure or violation by the other party
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giving notice of such default or noncompliance and written notice of its
intention to so terminate, unless within such thirty (30) day period the
defaulting party has cured such default; or
b. Discontinuance of Operations. Discontinuance of its operations by
either party by law or otherwise for a period of fifteen (15) or more days; or
c. Bankruptcy. The filing of a petition in bankruptcy by either party
or the making by either party of any assignment for the benefit of creditors;
or if any involuntary petition in bankruptcy or petition for an arrangement
pursuant to the Bankruptcy Act is filed against either party and is not
dismissed within thirty (30) days; or if a receiver is appointed for the
business of either party, or any part thereof.
d. Sale of Association. The sale of the Association or any part of
the Association or any part of the Association to a third party.
e. SBCL may terminate this Agreement immediately upon written notice
to Association under the following circumstances:
(1) Medical Director is charged with gross misconduct of either a
professional or personal nature, or engages in other conduct
which is grounds for immediate discharge without pay under
SBCL's personnel policies; or
(2) Medical Director is convicted of a crime other than a minor
traffic violation; or
(3) Medical Director has his or her right to practice medicine in
the State either suspended, lapsed, revoked, or placed under
probation, or is excluded from the Medicare or Medicaid
programs, or fails to maintain his or her standing as a
Board-Certified clinical and anatomic pathologist or licensed
cytotechnologist; or
(4) Medical Director has guardian or conservator of the person or
estate appointed by a court of competent jurisdiction; or
(5) Medical Director becomes permanently disabled to the extent he
or she is unable to perform the duties required by this
Agreement and ABCL does not approve the pathologist designated
by Association to act as the replacement or substitute for the
Medical Director.
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This subparagraph e. shall not apply if, within thirty (30) days after the
receipt by the Association of said notice, the Association in regard to said
Medical Director either terminates said Medical Director or undertakes said
actions as are necessary so that said Medical Director will no longer be
involved in the rendering of services to SBCL under this Agreement and
Association designates a pathologist who is approved by SBCL to act as the
replacement or substitute for the Medical Director.
E. Miscellaneous
1. Nonbreach. Each party represents and warrants that execution of and
performance under this Agreement shall not constitute or cause a breach of any
other agreement between that party and any third party.
2. Entire Agreement; Amendments. This Agreement contains the entire
understanding between the parties hereto and supersedes any and all prior
agreements, understandings and arrangements between the parties relating to the
subject matter hereof. No amendment, change, modification or alteration of the
terms and conditions hereof shall be binding unless evidenced by a writing
signed by all the parties hereto.
3. Waiver. The failure of any party to this Agreement to exercise or
enforce any right conferred upon it hereunder shall not be deemed to be a
waiver of any such right nor operate to bar the exercise or performance thereof
at any time or times thereafter, nor shall a waiver of any right hereunder at
any given time, including rights to any payments, be deemed a waiver thereof
for any other time.
4. Force Majeure. No party to this Agreement shall be liable for failure
to perform any duty or obligation that said party may have under the Agreement
where such failure has been occasioned by any act of God, fire, strike,
inevitable accident, war or any cause outside the reasonable control of the
party who had the duty to perform.
5. Severability. If any provision of this Agreement is held to be
illegal, invalid or unenforceable by a court of competent jurisdiction, the
parties shall, if possible, agree on a legal, valid and enforceable substitute
provision which is as similar in effect to the deleted provision as possible.
The remaining portion of the Agreement not declared illegal, invalid or
unenforceable shall, in any event, remain valid and effective for the term
remaining unless the provision found illegal, invalid or unenforceable goes to
the essence of this Agreement.
6. Assignment. Without prior written consent of the other party hereto,
neither party may assign any of its rights or delegate any of its obligations
hereunder. Notwithstanding anything
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to the contrary herein contained, SBCL may assign its rights hereunder to
SmithKline Xxxxxxx Corporation or any of its affiliated companies without the
consent of Association. Subject to the foregoing, this Agreement inures to the
benefit of, and is binding upon, the successors and assigns of the parties
hereto.
7. Legislative/Regulatory Modification. In the event Medicare, Medicaid
or any third-party payor, or any other federal, state or local law, rule,
regulation or interpretation thereof at any time during the term of this
Agreement prohibits, restricts or in any way substantially changes the method
or amount of reimbursement or payment for services under this Agreement, then
this Agreement shall, in good faith, be amended by the parties to provide for
payment of compensation in a manner consistent with any such prohibition,
restriction or change Association incurs additional costs, SBCL shall
compensate Association for such additional costs. However, if as a result of
any such prohibition, restriction or change Association's costs are reduced,
Association shall pay SBCL an amount equal to such reduction. With respect to
any such prohibitions, restriction or changes that require amendment of this
Agreement, if this Agreement is not so amended in writing prior to the
effective date of said change, this Agreement shall terminate, unless otherwise
agreed upon.
8. Notice. All notices hereunder shall be in writing, personally
delivered or sent by certified mail, return receipt requested, addressed to the
other party as follows:
If to Association: Xxxxxxx & Associates Pathology, P.A.
0000 Xxxxxxxxxx Xxxxx, Xxxxx 000
Xxxxxxx, Xxxxxxx 00000
Attention: Xxxxxx X. Xxxxxx, CEO
If to SBCL: SmithKline Xxxxxxx Clinical
Laboratories, Inc.
0000 Xxxx Xxxxxx Xxxxxx
Xxxxx, Xxxxxxx 00000
Attention: Xxxx X. Xxxxxxx, Xx.,
Vice President and
General Manager
With a copy to: SmithKline Xxxxxxx
Law Department (FP2225)
Xxx Xxxxxxxx Xxxxx
X.X. Xxx 0000
Xxxxxxxxxxxx, Xxxxxxxxxxxx 00000
Attention: Xxxxxx X. Xxxxxxx, Esq.
and
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Akerman, Xxxxxxxxxx Xxxxxx
17th Floor, Firstate Tower
000 Xxxxx Xxxxxx Xxxxxx
Xxxx Xxxxxx Xxx 000
Xxxxxxx, Xxxxxxx 00000-0000
Attention: Xxxxxxx X. Xxxxxxxxxxxx, Esq.
Either party may change its address to which notices shall be sent by a notice
similarly sent.
9. Execution in Counterpart. This Agreement may be executed
simultaneously in one or more counterparts, each of which shall be deemed an
original, but all of which together shall constitute one and the same
instrument.
10. Section Headings. Section headings contained in this Agreement
are for reference purposes only and shall not affect, in any way, the meaning
and interpretation of this Agreement.
11. Parties as Independent Contractors. The parties to this
Agreement understand and agree that no agency, employment, partnership or joint
venture is created by this Agreement, and the businesses operated by SBCL and
Association are separate. The parties further agree that neither party in the
general agent of the other and no representation shall be made by either party
that would create apparent agency, employment, partnership or joint venture.
Neither party will have the authority to act for the other in any manner, nor
to create obligations or debts that would be binding upon the other.
12. Governing Law. This Agreement and the rights and obligations
of the parties hereunder shall in all respects be governed by the substantive
law of the state of Florida, including all matters of construction, validity
and performance, but without giving effect to Florida choice-of-law or
conflict-of-law principles.
13. No Third Party Beneficiaries. This Agreement in solely
between SBCL and the Association, and no other parties shall have any rights or
privileges hereunder either as third party beneficiaries or otherwise.
14. Cross Default/Cross-Termination. This Agreement has been
entered into simultaneous with the parties also entering into a certain
Agreement for Professional Pathology Services (the "Pathology Services
Agreement"). This Agreement and the Pathology Services Agreement shall be
subject to cross default and cross termination provisions such that a default
under either agreement shall be and constitute a default under the other
agreement and the
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termation or expiration of one agreement shall also constitute the termination
or expiration of the other agreement.
(INTENTIONALLY LEFT BLANK)
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IN WITNESS WHEREOF, the duly authorized representatives of the parties
have executed this Agreement in duplicate effective as of the date first above
written, each party to retain a duplicate original.
SMITHKLINE XXXXXXX CLINICAL
LABORATORIES, INC. ("SBCL")
By: /s/Xxxx X. Xxxxxxx, Xx.
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Name: Xxxx X. Xxxxxxx, Xx.
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Title: Vice President/General Manager
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XXXXXXX & ASSOCIATES PATHOLOGY
P.A. ("ASSOCIATION")
By: /s/Xxxx X. Xxxxxx, M.D.
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Name: Xxxx X. Xxxxxx, M.D.
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Title: President
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