EXHIBIT 10.5
STRATEGIC ALLIANCE AGREEMENT
This Strategic Alliance Agreement (this "Agreement") is entered into this
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16th day of February, 2000, by and between IMS Health Incorporated, a Delaware
corporation ("IMS"), and Allscripts, Inc., a Delaware corporation
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("Allscripts").
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WHEREAS, IMS is engaged in, among other things, the business of providing
information solutions to the pharmaceutical and healthcare industries;
WHEREAS, Allscripts is engaged in, among other things, the business of
providing physicians with Internet and client/server medical management
solutions designed to improve the quality and cost effectiveness of
pharmaceutical healthcare;
WHEREAS, as soon as practicable after the date hereof, IMS and Allscripts
intend to organize a limited liability company pursuant to the laws of the State
of Delaware (such entity being referred to herein as "JV") and to enter into a
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limited liability company agreement with respect to the operation of JV;
WHEREAS, on the date hereof, IMS and Allscripts are entering into a
Subscription Agreement pursuant to which IMS will purchase shares of common
stock, par value $0.01 per share, of Allscripts for an aggregate purchase price
of $10,000,000;
WHEREAS, the parties to this Agreement desire to enter into a strategic
alliance pursuant to the terms and conditions set forth in this Agreement; and
WHEREAS, certain capitalized terms used herein shall have the meanings
ascribed to such terms in Annex A hereto.
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NOW, THEREFORE, in consideration of the mutual promises and covenants
contained in this Agreement, the parties hereto agree as follows:
ARTICLE I
Service Commitments
Section 1.01 Formation of JV; Development of Business Plan.
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(a) As soon as practicable after the date hereof, IMS and Allscripts agree to
cooperate in order to organize JV. IMS and Allscripts shall (i) each
receive a 50% membership interest in JV and (ii) jointly manage JV. Upon
the formation of JV, IMS and Allscripts shall amend and restate this
Agreement in order to provide that JV shall become a party to this
Agreement.
(b) All rights, obligations and duties of JV contained herein shall become
effective and binding on JV upon the execution of an amendment and
restatement of this
Agreement pursuant to which JV becomes a party hereto and bound by the
terms and provisions hereof.
(c) IMS and Allscripts agree to use their respective reasonable best efforts
to agree in writing upon a business plan (the "Business Plan") for JV
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within 90 days of the date hereof. The Business Plan shall set forth: (i)
the business objectives of JV; (ii) the financial plan and operating
budget of JV for calendar year 2000 and financial projections for
calendar years 2001 and 2002; (iii) the manner in which revenues derived
from the sale, license or other distribution of data products jointly
developed by IMS and Allscripts shall be shared among IMS, Allscripts and
JV; and (iv) such other matters as IMS and Allscripts shall mutually
agree upon. IMS and Allscripts acknowledge and agree that it is their
intent that the Business Plan shall also provide that: (i) JV shall
derive revenues from the sale, license or other distribution of any
product developed by JV; (ii) IMS and Allscripts shall mutually agree
upon which new products JV will design, develop, implement and market;
and (iii) if, subsequent to December 31, 2001, JV and/or IMS derives
revenues from the sale, license or other distribution of any product
which incorporates substantial Allscripts data or technology, IMS and
Allscripts shall agree on an appropriate sharing of revenues derived from
such products.
Section 1.02 Technology, Research & Development.
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(a) Related Goals. The parties agree to cooperate with each other: (i) to
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facilitate the commercialization of the information assets generated by
the TouchScript Service; (ii) to leverage the TouchScript Service as an
enabling technology for promotion, research and interactive communication
with physicians; and (iii) to develop next generation products using the
TouchScript Service platform for use by pharmaceutical companies,
insurance companies and other payors, and healthcare providers, including
physicians (together, the "Tech/R&D Goals"). Such next generation
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products may include, but are not limited to, potential next generation
products that relate to the following: (1) daily data and longitudinal
prescription data; (2) diagnosis to prescription "click" data; (3)
physician prescribing feedback and benchmark data; (4) rapid disease and
related therapy monitoring; (5) physician research data; (6) patient
compliance program enrollment; (7) sponsor programs; (8) prescription
sample request and fulfillment; and (9) e-Commerce. It is understood that
"e.Detailing" shall not be within the scope of this Agreement.
(b) Commitments of Resources. (i) In seeking to achieve the Tech/R&D Goals,
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Allscripts hereby agrees to provide the resources, among other things,
(1) to develop new TouchScript Service application software; (2) to
ensure data is centrally stored at a physical location; (3) to ensure the
secure transmission of data (VPN) to IMS on a nightly (or potentially on
a transaction-by-transaction) basis; (4) to manage reference files used
on TouchScript devices; (5) to modify databases as necessary by
applications; (6) to perform ongoing product
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engineering; (7) to incorporate changes to the software used on the
TouchScript Service to include the data fields and design specifications
mutually agreed to by Allscripts and IMS to generate source data for new
products and services; and (8) to collaborate with IMS in developing
interfaces between the Allscripts I/T systems and the IMS I/T systems to
permit the transmission of data from Allscripts to IMS.
(ii) In seeking to achieve the Tech/R&D Goals, IMS hereby agrees to
provide the resources, among other things, (1) to collect the User Data
from a central location on a nightly (or potentially on a transaction-by-
transaction) basis; (2) to ensure the secure receipt of the User Data
(VPN); (3) to standardize, scrub and edit the User Data to enable its use
in a data-based product; (4) to store the User Data; (5) to merge the
User Data with reference and client data; (6) to utilize statistical
analysis to project the data (if the parties deem it reasonably
necessary); (7) to provide input and advice to Allscripts relating to
data fields and the design specifications that would generate source data
for new information products and services in connection with Allscripts's
development of TouchScript Service applications software; (8) to provide
technical input and resources to Allscripts in connection with product
engineering; and (9) to collaborate with Allscripts in developing
interfaces between the Allscripts I/T systems and the IMS I/T systems
(including IMS and Erisco) to permit the transmission of data from
Allscripts to IMS.
(c) Dedicated Employees. In seeking to achieve the Tech/R&D Goals, Allscripts
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and IMS shall mutually agree upon the number of full-time equivalent
employees per year to be dedicated by each of Allscripts and IMS to the
Tech/R&D efforts.
Section 1.03 Sales and Marketing.
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(a) Related Goals. The parties agree to cooperate with each other (i) to
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expand market opportunities resulting in new revenue for Allscripts and
IMS and (ii) to accelerate the market penetration rate of Allscripts and
its existing TouchScript Service product offerings (together, the "Sales
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and Marketing Goals").
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(b) Contributions. In seeking to achieve the Sales and Marketing Goals, each
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of Allscripts and IMS agrees to cooperate with the other in the sales and
marketing of existing and future TouchScript Service product offerings.
Allscripts's primary marketing target will be physicians; and IMS's
primary marketing target will be pharmaceutical and biotechnology
companies. In marketing to their respective target constituencies, each of
Allscripts and IMS agrees to commit a dedicated sales force (as further
described in subsection (c) below) and conduct sales presentations
(including joint presentations) in furtherance of the Sales and Marketing
Goals. In addition to the foregoing, and in furtherance of the Sales and
Marketing Goals, Allscripts agrees, among other things: (1) to create end-
deliverables; (2) to deliver end results to Users; and (3) to process
orders (web-
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enabled); and IMS agrees to provide to JV and Allscripts profile
information for high prescribing physicians.
(c) Dedicated Employees. In seeking to achieve the Sales and Marketing Goals,
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Allscripts and IMS shall mutually agree upon the number of full-time
equivalent employees per year to be dedicated by each of Allscripts and
IMS to the Sales and Marketing efforts.
Section 1.04 Support Services.
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(a) Related Goals. The parties agree to cooperate with each other to support
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the efforts of each other in achieving the Tech/R&D Goals and the Sales
and Marketing Goals in respect of both existing and next generation
product offerings (together, the "Support Goals").
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(b) Commitments of Resources. (i) In seeking to achieve the Support Goals,
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Allscripts hereby agrees to provide the resources, among other things, (1)
to manage TouchScript Service inventories; (2) to provide help desk
support for TouchScript Service applications and hardware; (3) to
establish a joint management panel of physicians with IMS for recruitment,
obtaining data rights and reporting; (4) to provide 24-hour/7-day support
of data collection from TouchScript users and transmission of that data
from the users; and (5) to provide upgrades and enhancements to the
TouchScript Service as necessary in order to maintain Allscripts as a
Leading Provider.
(ii) In seeking to achieve the Support Goals, IMS hereby agrees to provide
the resources, among other things, (1) to support and facilitate the
transmission to, and receipt by, pharmaceutical companies of any User Data
customized by IMS; (2) to provide support to ensure network interfacing
and data exchange between Allscripts and IMS; and (3) to establish a joint
management panel of physicians with Allscripts for recruitment, obtaining
data rights and reporting.
(c) Dedicated Employees. In seeking to achieve the Support Goals, Allscripts
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and IMS shall mutually agree upon the number of full-time equivalent
employees per year to be dedicated by each of Allscripts and IMS to the
support efforts.
Section 1.05 Access to Doctors. Each of the parties agrees to commit all
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resources and efforts reasonably necessary to design, develop, implement, market
and support new technologies to facilitate access to Users by IMS including
enabling interactive communications with physicians. Such interactive
communications are designed to facilitate, among other things, research
projects, on behalf of pharmaceutical and biotechnology companies, promotions,
on behalf of Sponsoring Entities, and providing data and other information to
such Users.
Section 1.06 Licenses of User Data.
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(a) Allscripts hereby grants to JV a perpetual, worldwide, TRANSFERABLE,
EXCLUSIVE and sub-licensable license to use and license any User Data
generated during the term of this Agreement for the purpose of the (i)
granting of a license pursuant to subsection (b) of this Section 1.06 and
(ii) development of products utilizing the User Data as agreed between
Allscripts and IMS; provided, that Allscripts shall retain the rights to
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use the User Data for its internal administrative purposes and for
incidental purposes in connection with its sales and marketing efforts.
Without limiting the generality of the foregoing, Allscripts agrees that
during the term of this Agreement Allscripts shall not sell, license or
provide the User Data to any party other than JV. The license granted to
JV pursuant to this Section 1.06(a) shall include the right to sell,
license, create derivative works and sub-license the User Data and such
works to IMS; provided, however, that the parties acknowledge that JV's
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ability to sell, license or provide any individual patient data to IMS may
be limited by applicable laws.
(b) JV hereby grants to IMS a perpetual, worldwide, TRANSFERABLE, EXCLUSIVE
sub-license to use any User Data generated during the term of this
Agreement for any business purpose. Without limiting the generality of the
foregoing, JV agrees that during the term of this Agreement (i) JV shall
not sell, license or provide the User Data to any party other than IMS
except in accordance with the terms of the Business Plan and (ii) (as
against IMS) JV's sole right to the User Data shall be to develop products
as mutually agreed between Allscripts and IMS in the Business Plan. The
license granted to IMS in this Section 1.06(b) shall include the right to
sell, license, create derivative works and sub-license the User Data and
such works to third parties; provided, however, that the parties
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acknowledge that IMS's ability to sell, license or provide any individual
patient data to third parties may be limited by applicable laws.
(c) Notwithstanding anything to the contrary contained in subsections (a) and
(b) of this Section 1.06, nothing herein shall impair the rights of the
sources, related payor or associated pharmacy benefit manager of User Data
with respect to the portion of the User Data attributable to them.
(d) Subject to Section 4.01, Allscripts acknowledges and agrees that nothing
herein shall in any manner limit or restrict IMS from acquiring and/or
commercializing any data of any type (including data of a similar
character to the User Data) from any other third party or source.
(e) The parties hereto shall collaborate in the design and development of
processes in order to provide for the collection, storage and transmission
on a daily basis of the User Data for such day from Allscripts to JV and
from JV to IMS.
Section 1.07 Working Capital. The parties will evaluate and discuss the
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working capital needs of JV prior to commencement of any activities by JV. If
so agreed upon by the parties, IMS shall enter into a working capital facility
with JV on terms and
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conditions to be mutually agreed upon by the parties; provided, that in no event
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shall IMS's commitment pursuant to such facility exceed $10,000,000.
ARTICLE II
Physician Sponsorships
Section 2.01 General.
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(a) IMS agrees to use its reasonable best efforts in order to solicit
manufacturers and distributors of pharmaceutical products to enter into
Sponsorship Agreements upon terms and conditions mutually agreed upon by
IMS and the applicable pharmaceutical or drug company and reasonably
acceptable to Allscripts.
(b) Allscripts agrees to provide the Service to Sponsored Physicians, at an
agreed upon cost to such Sponsored Physicians, in the manner and for the
period specified in the applicable Sponsorship Agreement.
(c) Upon termination of the period during which a Sponsored Physician is to
receive the Service pursuant to the applicable Sponsorship Agreement,
Allscripts shall offer such physicians the opportunity to subscribe to the
Service on the same terms as Allscripts offers the Service to physicians
other than Sponsored Physicians.
Section 2.02 Reports and Payments for Physician Sponsorships.
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(a) On a quarterly basis, IMS shall provide JV and Allscripts with a report
that sets forth the terms of each Sponsorship Agreement then in effect.
Simultaneously with the delivery of such report, Allscripts shall be
entitled to receive a percentage (to be mutually agreed upon by Allscripts
and IMS) of the total revenues received as sponsorship fees pursuant to
Physician Sponsorship Agreements (the "Sponsorship Agreement Net
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Proceeds").
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(b) Immediately upon receipt of the Sponsorship Agreement Net Proceeds from
IMS, JV shall promptly pay Allscripts such funds received from IMS in
consideration for Allscripts's provision of the Service to the Sponsored
Physicians.
(c) Allscripts agrees to cooperate with IMS and to take all actions necessary
to ensure that the Sponsorship Agreements comply with all applicable laws
including, without limitation, all laws requiring full disclosure.
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ARTICLE III
Conduct of Business; Support
Section 3.01 Conduct of Allscripts Business. During the term of this Agreement,
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Allscripts shall carry on its business in compliance with all applicable laws
and regulations and use its reasonable best efforts consistent with past
practices and policies (i) to preserve its relationships with existing Users
(subject to customary attrition); and (ii) to solicit additional Users.
Section 3.02 Conduct of IMS Business. During the term of this Agreement, IMS
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shall carry on its business as it relates to the activities arising out of this
Agreement in compliance with all applicable laws and regulations.
Section 3.03 Costs and Expenses. Except as expressly contemplated hereby,
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Allscripts shall bear all costs and expenses in connection with the conduct of
its business and providing the Service, and shall not be entitled to any
additional compensation from IMS or JV in connection therewith.
Section 3.04 Market Penetration of Service. Allscripts agrees that on December
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31, 2000 it will have 4,250 Active Users utilizing the Service and on December
31, 2001 it will have 8,000 Active Users utilizing the Service.
ARTICLE IV
Fees, Compensation and Indemnification
Section 4.01 Fees and Compensation. In consideration for all obligations of
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Allscripts under Article I for calendar years 2000 and 2001, JV shall pay
Allscripts fees in the amount of $1,500,000 by December 31, 2000 and an
additional $2,000,000 by December 31, 2001 plus such other compensation as may
be agreed upon by IMS and Allscripts, and for periods subsequent to 2001 any
such compensation shall be as mutually agreed upon by Allscripts and IMS;
provided, that in the event that Allscripts fails to achieve its Active User
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target set forth in Section 3.04 in a particular year, such fact shall be taken
into account in assessing the amount of consideration to be paid to Allscripts
for the following year (including 2001). In consideration for all obligations
of IMS pursuant to Article I, JV shall pay IMS such compensation as may be
agreed upon by IMS and Allscripts. As set forth in Section 1.01, the terms
pursuant to which Allscripts and IMS shall share revenues with respect to future
products developed jointly by Allscripts and IMS that utilize the User Data
shall be mutually agreed upon by Allscripts and IMS.
Section 4.02 Indemnification.
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(a) Allscripts, at its own expense, shall indemnify and hold harmless JV, IMS
and each of their respective directors, officers, employees and agents from
and defend
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any action brought against the same with respect to any claim,
demand, cause of action, debt or liability, including reasonable attorneys'
fees, relating to any claim arising out of any breach of Allscripts's
representations, warranties, covenants, licenses and agreements set forth
in this Agreement.
(b) IMS, at its own expense, shall indemnify and hold harmless JV, Allscripts
and each of their respective directors, officers, employees and agents from
and defend any action brought against the same with respect to any claim,
demand, cause of action, debt or liability, including reasonable attorneys'
fees, relating to any claim arising out of any breach of IMS's
representations, warranties, covenants, licenses and agreements set forth
in this Agreement.
ARTICLE V
Nonpromotion
Section 5.01 Nonpromotion. Except as otherwise set forth herein, each of
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Allscripts and IMS agrees that at all times during the term of this Agreement,
neither it nor any of its respective Affiliates shall sell, distribute or
otherwise promote any services in the United States that are similar to the
Service being provided by Allscripts hereunder using a technology similar to the
TouchScript Service (the "Competitive Services"). Notwithstanding the
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foregoing, (i) if at any time during the term of this Agreement, Allscripts is
not a Leading Provider, IMS shall have the right to sell, distribute or
otherwise promote Competitive Services and (ii) the parties agree to discuss
business opportunities involving the prescription information industry outside
of the United States that may arise from time to time.
Section 5.02 Competitor Business Combinations. In the event that IMS enters
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into a business combination with a direct competitor (a "Competitor") of
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Allscripts, then Allscripts shall have the right, upon 10 days' prior written
notice (and within 90 days of the consummation of such business combination) to
elect to convert IMS's exclusive right to the User Data to a non-exclusive right
to the User Data, in which event, (i) Allscripts shall have the right to sell
and market User Data to third parties; (ii) IMS shall have the right to sell,
distribute or otherwise promote Competitive Services; and (iii) IMS shall have
the right to license the User Data from Allscripts during the term of this
Agreement at the lowest price paid by any third party (under comparable terms
and conditions) to Allscripts for the User Data or similar non-exclusive data
streams. In the event that Allscripts enters into a business combination with a
Competitor of IMS, then IMS shall have the right, upon 10 days' prior written
notice (and within 90 days of the consummation of such business combination),
(i) to extend the term of this Agreement (including the exclusivity provisions
contained herein) to the later of (x) the date that is two years from the date
of such election and (y) the then current termination date; and (ii) to sell,
distribute or otherwise promote Competitive Services. Either party may dispute
the claim that the third party with whom it has entered into a business
combination is, in fact, a Competitor of the other party, by delivering to the
other party a notice of dispute
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within 10 days of receiving the notice from such other party referred to in this
Section 5.02. Such a dispute will be settled according to the procedures
specified in Section 8.11. The sole issue in such dispute shall concern whether
the Competitor is, in fact, a direct competitor of the party not entering into a
business combination.
Article VI
Term and Termination
Section 6.01 Term. The term of this Agreement and the licenses and rights
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granted hereunder shall be for five (5) years from the date hereof, and for
successive one (1) year periods thereafter unless either party gives written
notice to the other party of its intention not to renew this Agreement at least
30 days prior to the expiration of the original term or any such one (1) year
renewal period.
Section 6.02 Termination. Notwithstanding anything to the contrary contained
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in Section 6.01, this Agreement may be terminated:
(a) if one party breaches the contractual obligations established herein,
and fails to cure such breach within a period of 30 days from the date
on which the breaching party receives written notice from the non-
breaching party regarding such breach, the non-breaching party shall
have the right to terminate this Agreement; and
(b) if one party enters judicial or extrajudicial liquidation or
reorganization proceedings, or files for bankruptcy, the other party
shall have the right to terminate this Agreement.
Article VII
Representations and Warranties
Section 7.01 Representations and Warranties of Allscripts. Allscripts hereby
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represents and warrants to each of JV and IMS as follows:
(a) Allscripts has the full power and authority to execute, deliver and
perform this Agreement.
(b) This Agreement has been duly and validly authorized, executed and
delivered by Allscripts and constitutes a valid and binding obligation
of Allscripts enforceable against it in accordance with its terms.
(c) The execution, delivery and performance by Allscripts of this
Agreement as contemplated hereby will not (i) conflict with, or result
in the breach or termination of, or constitute a default under, any
agreement of any kind or any judgment or decree, to which Allscripts
is in any way bound, except for such
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conflicts, breaches or defaults as would not, in the aggregate, have a
material adverse effect on the ability of Allscripts to perform its
obligations under this Agreement or (ii) constitute a violation by
Allscripts of any applicable law or regulation of any governmental
body, or any rule or written policy of any industry association of
competent jurisdiction, or require Allscripts to obtain or make any
consent, approval, or filing of any kind with, or notification to, any
person or governmental body.
(d) Allscripts has the rights to or owns, free and clear of any legal or
contractual encumbrances, all of the User Data and any Intellectual
Property Rights therein, and has all rights necessary to grant the
licenses and make the transfers under this Agreement under the terms
and conditions provided herein without the approval or consent of any
other party, subject to restrictions on the disclosure and
sublicensing of immaterial data.
(e) Allscripts is not, and will use its reasonable best efforts to not
become, subject to any contractual or other obligation or restriction
that prohibits or would prohibit, or impairs or would impair, its
grants of license and transfers or the performance of its obligation
under this Agreement, subject to restrictions on the disclosure and
sublicensing of immaterial data.
(f) The User Data and the use of the User Data by JV or IMS will not in
any material manner contravene, breach or constitute an unauthorized
use, infringement or misappropriation of any Intellectual Property
Right or any proprietary or property right of any other party.
(g) When the User Data is licensed to JV, JV will have all of the rights
necessary to grant the license to IMS hereunder on the terms and
conditions provided herein without the approval or consent of any
third party.
Section 7.02 Representations and Warranties of IMS. IMS hereby represents and
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warrants to each of JV and Allscripts as follows:
(a) IMS has the full power and authority to execute, deliver and perform
this Agreement.
(b) This Agreement has been duly and validly authorized, executed and
delivered by IMS and constitutes a valid and binding obligation of IMS
enforceable against it in accordance with its terms.
(c) The execution, delivery and performance by IMS of this Agreement as
contemplated hereby will not (i) conflict with, or result in the
breach or termination of, or constitute a default under, any agreement
of any kind or any judgment or decree to which IMS is in any way
bound, except for such conflicts, breaches or defaults as would not,
in the aggregate, have a material adverse effect on the ability of IMS
to perform its obligations under this Agreement or (ii)
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constitute a violation by IMS of any applicable law or regulation of any
governmental body, or any rule or written policy of any industry
association of competent jurisdiction, or require IMS to obtain or make any
consent, approval, or filing of any kind with, or notification to, any
person or governmental body.
Article VIII
Miscellaneous
Section 8.01 Notices. All notices and other communications hereunder shall be
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in writing and shall be deemed given if delivered personally or by commercial
delivery service, or sent via facsimile (receipt confirmed) to the parties at
the following addresses or facsimile numbers (or at such other address or
facsimile numbers for a party as shall be specified by like notice):
if to IMS, to:
IMS Incorporated
000 Xxxxx Xxxxx
Xxxxxxxx, XX 00000
Attention: Chief Executive Officer
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
with copies to:
IMS Incorporated
000 Xxxxx Xxxxx
Xxxxxxxx, XX 00000
Attention: Xxxxx Xxxxxxx
Xxxxx Xxxxxxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
and
Xxxx X. Xxxxxxxxxx, Esq.
Xxxxx X. Xxxxxxx, Esq.
Xxxxxxxx & Xxxxxxxx
000 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
if to Allscripts, to:
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Allscripts, Inc.
0000 Xxxxxxxx Xxxxx
Xxxxxxxxxxxx, XX 00000
Attention: Chief Executive Officer
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
with a copy to:
Xxxxxxx X. Xxxxxxxxxx, Esq.
Xxxxxxxx & Xxxxxx, Ltd.
00 Xxxxx Xxxxxx Xxxxx - 00xx Xxxxx
Xxxxxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Section 8.02 Counterparts. This Agreement may be executed in one or more
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counterparts, all of which shall be considered one and the same agreement and
shall become effective when one or more counterparts have been signed by each of
the parties and delivered to the other party, it being understood that all
parties need not sign the same counterpart.
Section 8.03 Entire Agreement; Third Party Beneficiaries. This Agreement and
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Annex A hereto (a) constitute the entire agreement among the parties with
respect to the subject matter hereof and supersede all prior agreements and
understandings, both written and oral, among the parties with respect to the
subject matter hereof; and (b) are not intended to confer upon any other person
any rights or remedies hereunder.
Section 8.04 Severability. In the event that any provision of this Agreement
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or the application thereof becomes or is declared by a court of competent
jurisdiction to be illegal, void or unenforceable, the remainder of this
Agreement will continue in full force and effect and the application of such
provision to other persons or circumstances will be interpreted so as reasonably
to effect the intent of the parties hereto. The parties further agree to replace
such void or unenforceable provision of this Agreement with a valid and
enforceable provision that will achieve, to the extent possible, the economic,
business and other purposes of such void or unenforceable provision.
Section 8.05 Remedies. Except as otherwise provided herein, any and all
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remedies herein expressly conferred upon a party will be deemed cumulative with
and not exclusive of any other remedy conferred hereby, or by law or equity upon
such party, and the exercise by a party of any one remedy will not preclude the
exercise of any other remedy.
Section 8.06 Governing Law. This Agreement shall be governed by and construed
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in accordance with the laws of the State of New York, regardless of the laws
that might otherwise govern under applicable principles of conflicts of law
thereof.
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Section 8.07 Rules of Construction. The parties hereto agree that they have
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been represented by counsel during the negotiation and execution of this
Agreement and, therefore, waive the application of any law, regulation, holding
or rule of construction providing that ambiguities in an agreement or other
document will be construed against the party drafting such agreement or
document.
Section 8.08 Assignment. Neither party may assign either this Agreement or any
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of its rights, interests, or obligations hereunder without the prior written
consent of the other party; provided, however, that in the event of dissolution
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of JV, all rights of JV hereunder shall vest in and accrue to the party
ultimately benefited thereby prior to such dissolution. Subject to the preceding
sentence, this Agreement shall be binding upon and shall inure to the benefit of
the parties hereto and their respective successors and permitted assigns.
Section 8.09 Survival. The rights and obligations of the parties pursuant to
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Sections 1.06 and 8.13 hereof shall survive the termination of this Agreement
indefinitely.
Section 8.10 Further Assurances. From and after the date hereof, each of the
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parties hereto further agrees to take such actions as may reasonably be required
in order to more fully effectuate the intent of the parties hereto.
Section 8.11 Dispute Resolution.
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(a) In the event of any controversy or claim arising from or relating to
this Agreement or the breach thereof, including a claim under Section
5.02 (each, a "Claim"), IMS, on the one hand, and Allscripts, on the
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other hand, shall use commercially reasonable efforts to resolve the
Claim. To this end, representatives of each party shall consult and
negotiate with each other in good faith and, recognizing their mutual
interests, attempt to reach a just and equitable solution satisfactory
to all parties. If they do not reach such solution within a period of
10 days from the date of their first meeting, such Claim shall be
referred to the chief executive officers of each of IMS and
Allscripts, who shall consult and negotiate with each other in good
faith and, recognizing their mutual interests, attempt to reach an
agreement to resolve the Claim. If such agreement is not reached by
such chief executive officers within 20 days from the date of their
first meeting, then the parties shall commence an arbitration in
accordance with this Section 8.11.
(b) If the Claim is not resolved by negotiation by the conclusion of the
negotiation periods referred to above, such Claim shall be resolved by
final and binding arbitration administered by the American Arbitration
Association (the "AAA") in accordance with its Commercial Arbitration
---
Rules and Title 9 of the U.S. Code. Judgment on the award rendered by
the arbitrators may be entered in any court having jurisdiction
thereof. The place of arbitration shall be New York, New York.
(c) Any party desiring to commence arbitration shall send a written notice
(an "Arbitration Notice") to the other party and to the AAA describing
------------------
the dispute
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and setting forth the matters to be resolved by the arbitration.
Within 20 days of the date of such notice (the "Notice Period"), the
-------------
other party may, if such party does not agree with the description or
statement of matters to be resolved, send an Arbitration Notice to the
other party and to the AAA describing the dispute and setting forth
the matters to be resolved by the arbitration. Within 10 days of the
end of the Notice Period, the parties shall, if they can agree, select
an arbitrator to resolve the dispute. In the event that the parties
have not selected an arbitrator within 10 days of the end of the
Notice Period, then the dispute shall be resolved by majority decision
of a panel of three arbitrators, selected by the AAA in accordance
with its rules.
(d) In selecting arbitrators, the parties or the AAA shall select persons
who are experienced in and knowledgeable about the information
technology and healthcare industries and are rendering no advice or
services to, and within the past two years have rendered no material
advice or services to, either party to this Agreement.
Section 8.12 Allscripts Inspection Right. Allscripts shall have the right, at
---------------------------
its sole expense, to inspect and audit the accounts, books and records of IMS
pertaining to Sponsored Physicians and Sponsored Agreements, upon reasonable
notice and during reasonable business hours.
Section 8.13 Public Announcements. IMS and Allscripts shall consult with each
--------------------
other prior to issuing any press release or otherwise making any public
statement regarding this Agreement or the transactions contemplated hereby and,
except as otherwise required by law or by obligations pursuant to any listing
agreement with, or rules of, any national securities exchange or national
securities interdealer quotation service, neither IMS nor Allscripts shall issue
any such press release or make any such public statement without the prior
written consent of the other party.
14
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their duly authorized respective officers as of the date first
written above.
IMS HEALTH INCORPORATED
By: /s/ Xxxxx Xxxxxxx
-------------------------------------
Name: Xxxxx Xxxxxxx
Title:
ALLSCRIPTS, INC.
By: /s/ Xxxxx X. Xxxxxx
-------------------------------------
Name: Xxxxx X. Xxxxxx
Title: President and Chief Financial
Officer
Annex A
DEFINITIONS
As used in the Agreement, the following terms shall have the respective
meanings set forth below:
"Active User" shall mean a User who has not remained inactive during any
-----------
four-month period.
"Affiliate" shall mean, with respect to any person, any other person or
---------
entity that directly or indirectly through one or more intermediaries controls
or is controlled by or is under common control with such person.
"Intellectual Property Right" shall mean any U.S. patent or patent
---------------------------
application, copyright, trademark, service xxxx (and any application or
registration respecting the foregoing), trade secret, know-how and other
intellectual property right of any type.
"Leading Provider" shall mean one of the top two providers of services
----------------
similar to the Service in the United States, based on the number of active user
physicians subscribing to a service similar to the Service.
"Service" shall mean the equipment and software offered by Allscripts to
-------
physicians which collectively enable electronic prescribing, routing of
prescription information and capturing of prescription data at the point of
care.
"Sponsored Physicians" shall mean any physician who is provided the Service
--------------------
pursuant to a Sponsorship Agreement.
"Sponsoring Entities" shall mean any pharmaceutical or drug manufacturer or
-------------------
distributor that has entered into a Sponsorship Agreement.
"Sponsorship Agreement" shall mean an agreement between IMS and a
---------------------
pharmaceutical or drug manufacturer or distributor pursuant to which such
manufacturer or distributor agrees to pay for all or a portion of the amounts
for the provision of the Service to physicians, as set forth more particularly
in such Sponsorship Agreement.
"Subscriber Agreement" shall mean an agreement between a physician and
--------------------
Allscripts pursuant to which such physician subscribes to the Service.
"TouchScript Service" shall mean the personal digital assistant based on
-------------------
the Microsoft CE operating system and associated software.
"User Data" shall mean any data provided by Users in connection with their
---------
use of the Service.
"User" shall mean a physician who has executed a Subscriber Agreement, but
----
shall not include any physician whose Subscriber Agreement has been cancelled or
terminated.
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