Exhibit 10.3
CONFORMED COPY
RETAIL INFORMATICS DATA
AND SERVICES AGREEMENT
THIS RETAIL INFORMATICS DATA AND SERVICES AGREEMENT is made and entered
into as of January 6, 2006 (the "Effective Date") by and between NDC Health
Information Services (Arizona) Inc., a Delaware corporation ("Provider"), and
NDCHealth Corporation, a Delaware corporation ("NDCHealth").
RECITALS
Provider is in the business of the business of providing data, analytics
and information management support solutions to pharmaceutical manufacturers,
Biotechnology Firms, Medical Device Manufacturers, Wall Street investment and
private equity firms (buy and sell side) for purposes of their pharmaceutical
and biotechnology analysis and governmental payors, enabling them, among other
things, to evaluate performance, develop strategies and optimize their marketing
and sales efforts, rebate spend and clinical trial recruitment efforts (the "IM
Business").
NDCHealth is in the business of (i) processing, editing and transmitting
pharmacy and medical data between providers (pharmacy, physician, hospital) and
payers (commercial, non-profit and government) and other parties (government
reporting, etc.), (ii) the development, sale and maintenance of systems for the
pharmacy, high volume (mail order, payers), hospital and physician markets and
claims cash flow management systems for the hospital industry and (iii) the
development, sale, license and conveyance of informatics products to the retail
pharmacy industry, Medical Device Manufacturers (limited to utilization review)
and third-party payers.
Immediately prior to the Effective Date, Provider was a wholly owned
subsidiary of NDCHealth. Upon the closing of the transactions contemplated by
that certain Stock Purchase Agreement, dated as of August 26, 2005, by and among
Wolters Kluwer Health, Inc. ("WKHI"), NDCHealth and Provider, WKHI is acquiring,
as of the Effective Date, all of the issued and outstanding equity interests of
Provider (the "Sale Transaction").
Simultaneously herewith Client and NDCHealth have entered into a Data
Supply and Services Agreement (the "Data Supply Agreement"), a Transition
Services Agreement (the "Transition Services Agreement") and a Contribution
Agreement.
Upon the closing of the transactions contemplated by that certain Agreement
and Plan of Merger, dated as of August 26, 2005, by and among Per-Se
Technologies, Inc., a Delaware corporation ("Patriot"), NDCHealth, and Royal
Merger Co., a Delaware corporation and a wholly owned subsidiary of Patriot
("Purchaser"), Purchaser will merge with and into NDCHealth (the "Merger") such
that NDCHealth will continue as the surviving corporation and a wholly owned
subsidiary of Patriot following the Merger.
Prior to consummation of the Sale Transaction, Provider provided to
NDCHealth through intercompany arrangements access to discrete databases
populated with aggregations of retail pharmacy data requested by NDCHealth,
which aggregations were drawn from Provider's databases of retail pharmacy data
and were used by NDCHealth in its development, sale and servicing of retail
pharmacy and payer informatics products and services. Provider also provided
NDCHealth with certain support services related to such databases. The parties
are entering into this Agreement to set forth the terms and conditions pursuant
to which Provider shall continue to provide NDCHealth with access to data and
related services after consummation of the Sale Transaction.
As an integral part of the long-term commercial relationship contemplated
by this Agreement and as a partial inducement to Provider to enter into this
Agreement, NDCHealth has agreed to contemporaneously enter into the Data Supply
Agreement.
Capitalized terms shall have the meanings ascribed to them in Section 13 of
this Agreement.
NOW, THEREFORE, for and in consideration of the above premises, the mutual
promises contained herein and other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the parties hereto, intending
to be legally bound, hereby agree as follows:
1. DATABASE ACCESS; SCRUBBING; PROVIDER CERTIFICATIONS; MONITORING
(a) RI Data. Subject to the terms and conditions of this Agreement, during
the Term, Provider shall provide NDCHealth with access to the RI Data
Repository, that will be populated by Provider with RI Data and
Purchased Data. Provider shall populate the RI Data Repository with
aggregations of RI Data requested by NDCHealth as more fully set forth
in the Service Level Commitments. The parties acknowledge that
Provider shall maintain the RI Data Repository separate and apart from
Provider's other databases and data storage.
(b) Access to and Population of Databases.
i. Provider shall provide NDCHealth with access to the RI Data and
RI Data Repository in accordance with the RI Data Access
Protocols. NDCHealth's access to the RI Data Repository shall be
subject to reasonable security restrictions, including
restrictions that prohibit NDCHealth from accessing data elements
to the extent such access is prohibited by the terms of Provider
Data Agreements. NDCHealth shall not be permitted to modify any
data located in the RI Data Repository, provided that NDCHealth
shall be permitted to extract data from the RI Data Repository
and copy such data to a separate database for purposes of
developing and delivering Certified Products. Access to the RI
Data Repository shall be sufficient, in all cases, to permit
NDCHealth to
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perform the analyses with respect to the RI Data Products and to
create and deliver the RI Data Products in accordance with the
Service Level Commitments and RI Data Access Protocols. Provider
shall, at its expense, maintain the RI Data Repository in a
manner sufficient to provide NDCHealth with such access to and
use of the RI Data in accordance with the Service Level
Commitments and RI Data Access Protocols.
ii. Provider shall populate the RI Data Repository with the RI Data
with the aggregations requested by NDCHealth and shall refresh
the RI Data included in the RI Data Repository in accordance with
the Service Level Commitments. Provider shall retain no less than
twenty four (24) data months of history (on a rolling basis) of
RI Data in the RI Data Repository. Provider shall make the RI
Data available to NDCHealth within the RI Data Repository in the
format specified in the Service Level Commitments.
iii. Provider covenants and agrees that during the Term, the RI Data
made available to NDCHealth will consist of (a) at least forty
percent (40%) of the Retail Prescription Data (unless otherwise
agreed by the parties) and (b) at least seventy-five percent
(75%) of the IM Prescription Data.
(c) Alterations to Covered Data and Delivery.
i. Notwithstanding the terms of this Agreement, Provider retains the
right at any time during the Term to alter the content, format,
method or timing of delivery of, the RI Data if Provider
determines, in its reasonable discretion exercised in accordance
with Provider's policies and procedures (applied in a
non-discriminatory manner with respect to similar circumstances),
that such alteration is required as a result of (i) changes in
the Act or other Applicable Laws, (ii) the passage of any new
Applicable Laws, (iii) the issuance of a published interpretation
of the Act or any other Applicable Law by a Governmental Body, or
(iv) the terms of the Provider Data Agreements (each of the
enumerated items are hereinafter referred to as a "Data
Alteration Event"). If Provider determines any such alteration is
required, Provider will notify NDCHealth as soon as reasonably
practicable and provide NDCHealth with an explanation of the
reasons for the alteration.
ii. Provider covenants and agrees that it shall use commercially
reasonable efforts to cause the terms of the IM Business
Agreements to permit or, in the case of Provider Data Agreements
that are executory as of the Effective Date, to continue to
permit, Provider to license the data to NDCHealth in the manner
described in this Agreement.
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iii. Provider covenants and agrees that it shall use commercially
reasonable efforts to ensure that any IM Business Agreements also
constitute Provider Data Agreements.
iv. Provider shall use commercially reasonable efforts to provide
NDCHealth with sixty (60) days (or such shorter period as is
practicable under the circumstances) advance notice of any
termination or non-renewal of a Provider Data Agreement.
(d) Repopulation; Retention of Data.
i. If any RI Data is damaged or unreadable and NDCHealth notifies
Provider thereof in writing within five (5) days after NDCHealth
is provided access to such RI Data, Provider shall re-populate
the RI Data Repository with replacement RI Data within two (2)
days of its receipt of written notice from NDCHealth.
ii. Provider shall retain the RI Data on computer magnetic tapes or
other media deemed appropriate by Provider for the RI Data for a
period of the longer of six (6) years or such period as may be
required by the Act or other Applicable Laws. If NDCHealth
desires that Provider retain the RI Data for longer periods,
NDCHealth shall provide Provider with such a request and Provider
shall provide NDCHealth with an estimate of the resulting
increase in costs to Provider. If NDCHealth agrees in writing to
reimburse Provider an amount equal to the lesser of such
estimated increase in costs and Provider's actual increase in
costs pursuant to Section 6(b) of this Agreement, Provider shall
extend its retention of the RI Data for such longer period.
(e) De-Identification and Encryption of Covered Data. Before delivering RI
Data to NDCHealth, Provider shall de-identify the RI Data to Level 1
De-Identification and shall utilize the Encryption Engine to encrypt
the RI Data.
(f) Provider Certifications. Provider shall provide NDCHealth with an
annual RI Data Certification, an annual Level I Certification, an
annual Level II Certification and an annual Security Certification, in
each case in accordance with the Data Security Requirements. Each RI
Data Certification, Level I Certification, Level II Certification and
Security Certification shall be in the form set forth in the Data
Security Requirements and shall be signed by a Qualified Statistician
reasonably acceptable to NDCHealth. All fees and expenses incurred by
Provider in obtaining such Certifications shall be borne by Provider.
(g) DISCLAIMER. NDCHEALTH ACKNOWLEDGES THAT THE COMPLETENESS OF THE DATA
ELEMENTS INCLUDED IN THE RI DATA IS DEPENDENT UPON THE DATA ELEMENTS
INCLUDED IN THE CLAIMS DATA RECEIVED BY PROVIDER FROM THE PHARMACIES
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PROVIDING SUCH DATA. PROVIDER MAKES NO REPRESENTATIONS OR WARRANTIES
REGARDING THE RI DATA, AND HEREBY DISCLAIMS ALL IMPLIED WARRANTIES,
INCLUDING, WITHOUT LIMITATION, WARRANTIES OF MERCHANTABILITY, FITNESS
FOR A PARTICULAR PURPOSE, COMPLETENESS, AND ACCURACY.
(h) Discovery of PHI. NDCHealth shall notify Provider immediately if
NDCHealth becomes aware of any PHI included in the RI Data. Following
such notice, NDCHealth shall consult with Provider regarding treatment
and handling of the RI Data determined to contain PHI and shall
destroy all RI Data including PHI in NDCHealth's possession in a
manner satisfactory to Provider and shall certify such destruction to
Provider in writing.
2. LICENSE TO USE RI DATA; PROHIBITED USES; OWNERSHIP
(a) Licenses. Subject to the restrictions set forth in this Agreement and
any limitations imposed by Applicable Laws, Provider hereby grants to
NDCHealth (i) an exclusive (even as to Provider), world-wide,
transferable, fully-paid, royalty-free, irrevocable license to the RI
Data for use by NDCHealth in the NDC Field, for a period of ten (10)
years commencing on the Effective Date, and (ii) a non-exclusive,
world-wide, transferable, fully-paid, royalty-free, irrevocable
license to the RI Data for all other lawful uses, except the IM Field
during the Term, each in accordance with the terms and conditions of
this Agreement.
(b) Scope of Use. Subject to the restrictions set forth in this Agreement,
NDCHealth shall be permitted to use, copy, extract, compile,
assimilate, manipulate, analyze and otherwise process and modify the
RI Data for purposes of incorporating the RI Data into Certified
Products, and may license, sublicense, transmit and distribute the RI
Data, as incorporated into Certified Products, to third parties in
accordance with the terms of this Agreement, in each case for purposes
of, or in connection with, the development, sale, license or other
conveyance of Certified Products to the Retail Pharmacy Industry,
Health Care Providers, non-governmental third party payers and
consumers.
(c) Certain Covenants. Notwithstanding the licenses granted pursuant to
this Section 2 or any other term of this Agreement, NDCHealth
covenants and agrees that it shall not engage, and shall not cause or
permit any Person acting on its behalf or at its direction to engage,
at any time in any Prohibited Use of the RI Data. Provider covenants
and agrees that it shall not (i) for a period of ten (10) years
beginning on the Effective Date, use the RI Data to create, sell or
deliver to Health Care Providers, non-governmental third party payers
or consumers those NDC Products Provider is restricted from providing
to each of Health Care Providers, non-governmental third party payers
or consumers pursuant to Section 11 of the Data Supply Agreement and
Schedule 11(b) to the Data Supply Agreement, or (ii) during the entire
Term, use the RI Data (1) to create, sell or deliver to customers in
the Retail Pharmacy Industry those NDC Products
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Provider is restricted from providing to customers in the Retail
Pharmacy Industry pursuant to Section 11 of the Data Supply Agreement
and Schedule 11(b) to the Data Supply Agreement or (2) to provide
network services.
(d) Survival. The licenses granted pursuant to this Section 2 shall
survive the expiration or earlier termination of this Agreement with
respect to RI Data provided to NDCHealth before the effective date of
such expiration or termination, provided NDCHealth remains in
compliance with all terms and conditions of this Agreement applicable
to such RI Data and provided further that any such surviving license
shall, in respect of RI Data initially licensed exclusively, revert to
a non-exclusive license six years after the date of purchase but in
any event not sooner than the end of the Term.
(e) Ownership of Purchased Data. As between the parties, (i) all rights in
and to the Purchased Data (including, but not limited to, all
intellectual property rights therein) shall remain the property of
Provider or such other licensor of the Purchased Data to Provider and
(ii) all rights in and to the Certified Products (including, but not
limited to, all intellectual property rights therein), shall remain
the property of NDCHealth. NDCHealth shall acquire no right, title or
interest in or to the Purchased Data except as otherwise expressly
provided in this Section 2. Nothing in this Agreement shall be deemed
to confer upon Provider or any other Person any right, title or
interest in or to the NDC Data, the ownership of which is governed in
all respects by the terms of the Data Supply Agreement.
3. NDCHEALTH CERTIFICATIONS
(a) Security Certification. NDCHealth shall provide Provider with an
annual Level II Certification and an annual Security Certification in
accordance with the Data Security Requirements.
(b) Level II Certifications. Prior to any offer for sale, sale, license,
delivery or other conveyance by NDCHealth, or by any Person acting on
NDCHealth's behalf or at Provider's direction, of an RI Data Product,
NDCHealth shall provide Provider with Level II Certifications for such
RI Data Product in accordance with the Data Security Requirements.
(c) Level III Certifications. Any material change or modification to a
Certified Product or to the permitted or prohibited uses of a
Certified Product must be preceded by a Level III Certification
delivered to and approved by Provider pursuant to this Section 3(b).
The implementation of any material change or modification to a
Certified Product or to the permitted or prohibited uses thereof that
has not been preceded by a Level III Certification delivered to
Provider in accordance with the Data Security Requirements and this
Section 3(b) shall result in the affected RI Data Product(s) no longer
constituting Certified Products for purposes of this Agreement. For
purposes of this Agreement, any modification to
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a Certified Product or to its permitted or prohibited uses shall be
deemed material if, in Provider's reasonable discretion exercised in
accordance with Provider's policies and procedures (applied in a
non-discriminatory manner with respect to similar circumstances), such
modification could reasonably be expected to adversely impact the
validity of the Level II Certification or Level III Certification
applicable to such Certified Product.
(d) Form of Certifications. Each NDCHealth Certification shall be signed
by a Qualified Statistician reasonably acceptable to Provider. All
fees and expenses incurred by NDCHealth in obtaining such
certifications shall be borne by NDCHealth.
(e) Additional Certifications. If any third party from which Provider
obtains data that is included within the Purchased Data is entitled,
pursuant to a Provider Data Agreement governing the provision of such
data, to receive certifications, in addition to those set forth in
this Section 3, NDCHealth shall provide such certifications as a
condition to the inclusion within the Purchased Data of the data
provided by such third party.
NDCHealth may at any time at NDCHealth's reasonable discretion, upon ninety
(90) days' prior written notice to Provider, alter any aspects of the
policies and procedures relating to NDCHealth's determination of whether to
issue a particular NDCHealth Certification; provided that, if at any time
during the 90-day notice period set forth in this paragraph, Provider
determines, in its reasonable discretion, that a proposed alteration would
not be consistent with this Agreement (including the Data Security
Requirements) the Act, Applicable Laws or the Provider Data Agreements,
NDCHealth will refrain from effecting the proposed alteration until such
time as Provider has consented in writing to the proposed alteration.
4. AUDIT RIGHTS AND DATA SUSPENSION
(a) Audit Rights. Subject to the provisions of this Section 4, Provider
may, at any time upon reasonable notice to NDCHealth, engage a third
party auditor reasonably acceptable to NDCHealth to inspect and audit
the systems, operations, processes, records and leased and owned
premises of NDCHealth (or of any Person performing services on behalf
of or at the direction of NDCHealth, that relate to or impact in any
material respect the transmission, processing or storage of the RI
Data or the sale, license, delivery, distribution or other conveyance
of any RI Data Product for purposes of confirming NDCHealth's
compliance with the terms, conditions and requirements of this
Agreement. NDCHealth shall include in its contracts with Persons
performing functions on behalf of or at the direction of NDCHealth,
which functions are within the scope of the audit rights afforded
Provider pursuant to this Section 4(a), terms requiring such Persons
to grant Provider sufficient access to such Persons' systems,
processes, operations, records and premises to enable Provider to
exercise fully its rights hereunder; provided that NDCHealth shall not
be required to include in its leases such terms
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if NDCHealth otherwise has the right to allow Provider access to such
premises. Provider may engage a third party, reasonably acceptable to
NDCHealth, to perform audits in accordance with this Section 4(a) on
behalf of Provider, provided (i) such third party is not engaged in a
business that is competitive with the business engaged in by NDCHealth
and (ii) such third party enters into a confidentiality or similar
agreement placing reasonable restrictions on such third party's use of
any confidential information of Provider obtained by the third party
during its performance of the audit. For purposes of this Section
4(a), "reasonable notice" means notice of at least five (5) calendar
days, or such shorter period that Provider demonstrates it reasonably
requires; provided, however that Provider shall be permitted to
exercise its audit rights under this Section 4(a) immediately and
without advance notice if the audit pertains to a suspected breach of
the terms of Section 2(a), 2(b) or 2(c) of this Agreement or a
suspected violation of the Act or other Applicable Laws. Provider may
perform an audit under this Section 4(a) no more often than twice in
any (12) month period, except that Provider may perform such audits
more often if the audit pertains to a suspected breach of the terms of
Section 2(a), 2(b) or 2(c) of this Agreement or a suspected violation
of the Act or other Applicable Laws, or if otherwise required under
the Act or any other Applicable Laws or if required by a court or
another Governmental Body. NDCHealth shall cooperate, as reasonably
requested by Provider, in any audits performed on behalf of Provider
or by any third party engaged by Provider pursuant to this Section
4(a). Any audits performed by Provider (or a third party engaged by
Provider) pursuant to this Section 4(a) shall be conducted at the
expense of Provider. During the Term and for a period of six (6) years
thereafter, or for such longer period as may be required by the Act or
other Applicable Laws, NDCHealth shall retain sufficient historical
business records, for a period of at least six (6) years, to evidence
compliance with its obligations under this Agreement, the Act and all
other Applicable Laws. Any notice of Provider's intent to conduct an
audit pursuant to this Section 4(a) shall be provided in writing to an
individual designated by NDCHealth to receive such notice, and to
NDCHealth at the address specified in Section 12(d) of this Agreement.
Any audit conducted pursuant to this Section 4(a) shall be conducted
so as to minimize any disruption to the conduct of NDCHealth's
day-to-day operations to the extent reasonably possible in light of
the circumstances, and otherwise in a commercially reasonable manner.
(b) Data Suspension. If Provider's auditor determines, in its reasonable
discretion after completing any audit arising pursuant to Section
4(a), a Data Alteration Event has occurred or that any change in
NDCHealth's transmission, use or storage of the RI Data or any
Certified Product (i) constitutes a breach of the terms of Section
2(a), 2(b) or 2(c) of this Agreement, (ii) is not in compliance with
the Act, other Applicable Laws or the terms of any Provider Data
Agreement or (iii) poses greater than a Very Small risk that RI Data
in a particular RI Data Category could be used or disclosed in a
manner to identify individuals, Provider shall immediately notify
NDCHealth of such determination, and Provider may, upon delivery of
such notice, suspend transmission of the RI Data included in
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each RI Data Category which Provider's auditor determines, in its
reasonable, good faith discretion, should be suspended in response to
such Data Alteration Event or in order to eliminate such breach,
non-compliance or greater risk. In such event (a "Data Suspension
Event"), Provider shall (i) continue to produce, but deny NDCHealth
access to, the RI Data contained in each suspended RI Data Category,
(ii) store all RI Data produced during such Data Suspension Event and
included in the suspended RI Data Category, and (iii) upon a joint
determination by the parties that delivery of the RI Data included in
a suspended RI Data Category may be resumed in compliance with the
Act, other Applicable Laws and the terms of this Agreement and the
Provider Data Agreements, transmit such stored RI Data to NDCHealth
and resume ongoing delivery of the RI Data included in such RI Data
Category.
5. SERVICES; USE OF PROVIDER PREMISES
(a) Data Support Services. During the Term, Provider shall provide
reasonable data support services in accordance with the Service Level
Commitments, and shall make available to NDCHealth employees of
Provider with sufficient experience and expertise in the operational
matters related to the collection, aggregation and transmission of the
RI Data and access to and use of the RI Data Repository to provide the
data support services to Client. The parties anticipate that the data
support services shall be provided primarily by telephone and email
communications. Notwithstanding the foregoing, if requested by
NDCHealth, Provider shall provide the data support services on-site at
NDCHealth facilities; provided that NDCHealth must provide Provider
with reasonable advance notice of a request for on-site support.
Provider shall cause any of its employees providing data support
services at NDCHealth facilities to comply with all rules and
guidelines of NDCHealth applicable to conduct in its premises,
including security protocols. Provider shall be responsible for the
conduct of its employees while present in NDCHealth facilities and
shall take all reasonable precautions to prevent the occurrence of any
injury to persons or property or any interference with the operations
of NDCHealth.
(b) Provider Systems; NDCHealth Materials. Provider hereby grants to
NDCHealth a non-exclusive, non-transferable license to use the IM
Systems during the Term in connection with the development, production
and servicing of Retail Informatics Products.
(c) Select Client Databases. The parties agree that from and after the
relocation of the Select Client Databases from Provider's Data Center
to NDCHealth's facilities, for the remainder of the Term, Provider
shall continue to populate the Select Client Databases with RI Data in
accordance with the terms of this Agreement notwithstanding their
relocation and shall be responsible for transmission of the RI Data to
the Select Client Databases after their relocation to an NDCHealth
facility and all costs associated with such transmission.
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(d) PPE Data Feed. During the Term, Provider shall provide data files
supporting the NDCHealth pre- and post-editing product, and the
NDCHealth Intelligent Network product in accordance with the Service
Level Commitments. Such data files shall include both market
information regarding usual and customary pricing, as well as
physician DEA identification files in the formats identified in, and
provided in accordance with, the Service Level Commitments.
Additionally, Provider shall provide monthly prescription counts and
total associated dollars segregated by retail and mail order segments
on a national basis in order to allow NDCHealth to continue
marketshare calculations. Provider shall be responsible for license
fees associated with the provision of such data files.
(e) New Services. NDCHealth may request from time to time during the Term
that Provider provide to NDCHealth New Services in addition to those
described in this Section 5 as required to be provided to NDCHealth as
of the Effective Date. Provider shall cooperate in good faith
regarding any requests by NDCHealth that Provider perform New
Services. The terms and conditions pursuant to which Provider would
provide New Services, including any fees that would be payable by
NDCHealth to Provider in consideration of its performance thereof,
shall be agreed upon by the parties in writing prior to the
commencement of the performance of any New Services by Provider;
provided, however, that if the parties are unable to agree on the
terms and conditions pursuant to which Provider would provide any New
Services, Provider shall not be required to provide such New Services.
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(f) Use of Provider Premises by NDCHealth Employees. The parties
acknowledge that as of the Effective Date six (6) employees of
NDCHealth that are engaged in NDCHealth's retail informatics business
are provided with office space at Provider's offices located at 0000
Xxxx Xxxxxxxxx Xxxx, Xxxxxxx, Xxxxxxx. During the Term, Provider shall
continue to allow such NDCHealth employees (or new employees who
replace such employees) to occupy and utilize, without charge, similar
office space and facilities at such premises (or any similar premises
to which Provider may relocate during the Term). NDCHealth shall cause
its employees occupying such premises to comply with all rules and
guidelines of Provider applicable to conduct in its premises,
including security protocols. NDCHealth shall be responsible for the
conduct of its employees while present in Provider facilities and
shall take all reasonable precautions to prevent the occurrence of any
injury to persons or property or any interference with the operations
of Provider.
(g) During the Term, Provider shall (i) provide NDCHealth access to
Provider's Delivery Tracking System for use in connection with the
license by Provider to NDCHealth of the RI Data and the access by
NDCHealth to the RI Data Repository and the RI Data; (ii) support and
maintain the Delivery Tracking System, including, without limitation,
appropriate network connectivity, at levels and in a manner consistent
with practices on the Effective Date, and (iii) provide on a periodic
basis such reports containing such information and in a format, in
each case, as reasonably requested by NDCHealth, to allow NDCHealth to
meet its financial reporting obligations.
6. PAYMENTS AND INVOICING
(a) Data Fees. In consideration of the performance by Provider of its
obligations under this Agreement and the license to the RI Data
granted to Provider hereunder, NDCHealth shall pay to Client the Data
Fees.
(b) Reimbursement of Costs. To the extent Provider agrees, in its
discretion, to provide any modified data or modified services
hereunder or any modifications in the manner in which data or services
are provided hereunder, such modifications shall be agreed upon in
writing in advance by the parties. In addition to the payment to
Provider of any fees that may be agreed upon by the parties in
connection with such modifications, NDCHealth shall reimburse Provider
for any actual additional costs incurred by Provider as a result of
such modifications, and shall reimburse Provider for the actual cost
of all travel, travel-related (including food, lodging and incidental)
and out-of-pocket expenses incurred by Provider employees in
performing the Data Support Services at NDCHealth sites, provided in
each case that such expenses are reasonable and evidenced by
sufficient documentation provided to NDCHealth.
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(c) Fees for New Services. Any fees payable by NDCHealth to Provider in
connection with Provider's performance of New Services shall be agreed
upon by the parties in writing pursuant to Section 5(e).
(d) Payment and Invoice. Within fifteen (15) days after the end of each
calendar month during the Term, Provider shall deliver an invoice to
NDCHealth for one-twelfth (1/12) of the applicable year's Data Fees
and any amounts that may be payable pursuant to Section 6(b) and
Section 6(c) of this Agreement with respect to such calendar month.
Each invoice shall provide in reasonable detail a breakdown of the
amounts invoiced among Data Fees, expenses and fees for New Services,
as applicable. Each invoice shall be accompanied by a Provider
certification setting forth, with respect to such calendar month, (a)
the percentage of the Retail Prescription Data of which the RI Data
consists and (b) the percentage of the IM Prescription Data of which
the RI Data consists. NDCHealth shall pay to Provider all invoiced
amounts not in dispute within thirty (30) days of NDCHealth's receipt
of each invoice.
(e) Withholding of Disputed Amounts. NDCHealth shall have the right to
dispute in good faith any amount included in any invoice delivered
pursuant to this Agreement and to withhold from payment of any such
invoice the amount in dispute. If any invoice is disputed, the
undisputed amount shall be timely paid and the parties shall negotiate
in good faith a resolution for the remainder; provided, however, that
if the parties cannot reach agreement on any disputed amount, the
matter shall be resolved in accordance with Section 10 of this
Agreement. If NDCHealth disputes the amount of any invoice, it shall
provide Provider with a written notice setting forth the disputed
amount and the reasons therefor. Any deduction of a disputed amount of
an invoice that is not specifically agreed to by Provider in writing
and that finally is determined to have been improperly withheld shall
be paid promptly by NDCHealth, plus interest thereon computed at a
rate equal to one-half percent (0.5%) per month of the improperly
withheld amount accruing from the date when payment was due until the
date paid.
(f) Late Fees. Provider may assess NDCHealth a late payment charge on any
amount not in dispute that remains unpaid by NDCHealth after it is
due, computed at a rate equal to one-half percent (0.5%) per month of
the unpaid amount accruing from the date when payment was due until
the date paid.
(g) Taxes. NDCHealth shall be responsible for all sales, use, transfer,
privilege, excise, charges; surcharges; or other taxes, however
designated, which are levied or imposed by a Governmental Body by
reason of the transactions contemplated hereby, excluding income taxes
which may be levied against Provider.
(h) Audit Rights. NDCHealth may, at any time upon reasonable notice to
Provider, inspect and audit the books and records of Provider for
purposes of confirming the accuracy of amounts invoiced to NDCHealth
by Provider and the percentage of
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the Retail Prescription Data and the IM Prescription Data of which the
RI Data consists as certified by Provider (but not more than once in
any six month period) pursuant to this Agreement. NDCHealth may engage
a third party to perform audits in accordance with this Section 6(h)
on behalf of NDCHealth, provided (i) such third party is not engaged
in a business that is competitive with the business engaged in by
Provider and (ii) such third party enters into a confidentiality or
similar agreement placing reasonable restrictions on such third
party's use of any confidential information of Provider obtained by
the third party during its performance of the audit. Audits conducted
pursuant to this Section 6(h) shall be conducted in a manner that does
not unreasonably disrupt or delay Provider's business operations and
in compliance with the reasonable security procedures of Provider.
Provider shall cooperate, as reasonably requested by NDCHealth, in any
audits performed by NDCHealth (or by any third party engaged by
NDCHealth) pursuant to this Section 6(h). For purposes of this Section
6(h), "reasonable notice" means notice of at least five (5) calendar
days or such shorter period that Client demonstrates it reasonably
requires. Any audits performed by NDCHealth (or a third party engaged
by NDCHealth) pursuant to this Section 6(h) shall be conducted at the
expense of NDCHealth. Provider shall retain sufficient historical
business records, for a period of at least three (3) years, to
evidence the accuracy of the amounts invoiced to NDCHealth pursuant to
this Agreement during the Term and for a period of three (3) years
thereafter.
7. TERM AND TERMINATION
(a) Term. The term of this Agreement (the "Term") shall begin on the
Effective Date and, unless terminated earlier pursuant to Section 7(c)
or Section 7(d) or extended pursuant to Section 7(b), shall continue
until 12:01 a.m. Atlanta, Georgia time on the twentieth (20th)
anniversary thereof.
(b) Extension of Term. Unless Provider provides written notice to
NDCHealth no less than six (6) months prior to the end of the Term
that Provider will not extend the Term, the parties shall negotiate in
good faith the terms and conditions applicable to, and the duration
of, an extension of the Term. If the parties have not agreed upon the
terms and conditions applicable to an extension of the Term by the
date two (2) months prior to the expiration of the Term, this
Agreement shall expire at the end of the Term.
(c) NDCHealth Rights to Terminate. NDCHealth may terminate this Agreement
immediately upon the occurrence of any one or more of the following
events:
i. upon the fifth anniversary of the Effective Date, pursuant to
written notice delivered to Provider not less than thirty (30)
days prior to the fifth anniversary of the Effective Date; or
ii. upon (A) the adjudication of Provider to be bankrupt or
insolvent, (B) the filing of a petition in bankruptcy or
insolvency by or against Provider, or
13
the filing of a petition seeking the appointment of a receiver
with respect to all or a substantial part of the property of
Provider, (C) the filing by Provider of a petition seeking
reorganization of its debts or financial structure under a law
relating to insolvency or bankruptcy, or (D) the institution by
Provider of any proceedings for liquidation or winding up of its
business (other than for purposes of reorganization,
consolidation or merger), provided that Provider shall have sixty
(60) days to obtain a stay from or dismiss any filings under this
Section 7(c)(ii) that are commenced by third-parties.
(d) Provider Rights to Terminate. Provider may terminate this Agreement
immediately upon the occurrence of any one or more of the following
events:
i. subject to the provisions of Section 6(e), upon NDCHealth's
non-payment of amounts owed to NDCHealth within five (5) days
following an arbitrator's final award in NDCHealth's favor in
accordance with Section 10; or
ii. upon (A) the adjudication of NDCHealth to be bankrupt or
insolvent, (B) the filing of a petition in bankruptcy or
insolvency by or against NDCHealth, or the filing of a petition
seeking the appointment of a receiver with respect to all or a
substantial part of the property of NDCHealth, (C) the filing by
NDCHealth of a petition seeking reorganization of its debts or
financial structure under a law relating to insolvency or
bankruptcy, or (D) the institution by NDCHealth of any
proceedings for liquidation or winding up of its business (other
than for purposes of reorganization, consolidation or merger),
provided that NDCHealth shall have sixty (60) days to obtain a
stay from or dismiss any filings under this Section 7(d)(ii) that
are commenced by third-parties.
(e) Rights and Obligations upon Expiration or Termination. Following the
expiration or termination of this Agreement, neither party shall have
any further rights, privileges or obligations hereunder except that
such expiration or termination shall not (i) relieve either party of
any liability accrued or liability for any breach occurring prior to
the effective date of such expiration or termination and (ii) affect
the continued operation or enforcement of any provision of this
Agreement which by its express terms or reasonable implication is to
survive any expiration or termination of this Agreement, including (A)
Sections 2, 3 and 4, in each case solely with respect to RI Data made
available to NDCHealth prior to the expiration or termination of this
Agreement, (B) Section 6, solely with respect to payment obligations
arising out of periods prior to the expiration or termination of this
Agreement, (C) this Section 7(e), and (D) Sections 8, 9, 10 and 11. In
addition to the foregoing, to the extent this Agreement expires or is
terminated for any reason, but in spite of such expiration or
termination Provider continues to make RI Data available to NDCHealth
subsequent to such expiration or termination, then the terms and
conditions of this Agreement shall continue to
14
govern such RI Data access until such time as another Agreement is
executed by the parties which is meant to supersede this Agreement or
until Provider discontinues the provision of RI Data to Client.
8. CONFIDENTIALITY
(a) Definition of Confidential Information. As used herein, the term
"Confidential Information" means information in the possession or
under the control of a party relating to a party's technical,
marketing, product and business affairs, including customer, prospect,
price, and other proprietary and trade secret information, whether
oral, graphic, written, electronic or in machine readable form, and
includes all computer programs (and source code therefor), all amounts
paid or payable to Provider under Section 6 hereof, all information
relating to the payment of such amounts, all proposals, plans,
programs, analyses, compilations, forecasts, studies or other
documents prepared by a party or by them jointly relating to the
subject matter of this Agreement, including the terms of this
Agreement. Confidential Information does not include information which
(i) was in the public domain before disclosure, (ii) becomes part of
the public domain after disclosure by a publication or other means
except by a breach of this Agreement by the receiving party, (iii) was
received from a third party under no duty or obligation of
confidentiality to the disclosing party, or (iv) was independently
developed by the receiving party without reference to Confidential
Information.
(b) Use of Confidential Information. Each party acknowledges that it and
its affiliates, and its or their respective employees, agents and/or
subcontractors, has had prior to the Effective Date, and/or may have
in performing its obligations and/or exercising rights under this
Agreement, access to or be directly or indirectly exposed to
Confidential Information of the other party. Except as may be required
to: (i) facilitate either party's performance of its obligations
and/or exercise of its rights under this Agreement; or (ii) comply
with any applicable law, court order or Exchange Rule, each party
covenants and agrees that it shall hold confidential all Confidential
Information of the other party and shall not use or disclose such
Confidential Information without the express consent of the disclosing
party. Each party shall take reasonable measures and efforts to
provide protection for the disclosing party's Confidential
Information, including measures at least as strict as those the
receiving party uses to protect its own Confidential Information. A
party may disclose Confidential Information of the other party only
with such other party's prior written consent or as otherwise required
by law, court order or Exchange Rule; provided that in each case the
parties shall use all reasonable efforts to limit the disclosure and
maintain confidentiality of such Confidential Information to the
extent reasonably possible. If a party is served with a court or
administrative order requiring any disclosure of the other party's
Confidential Information, or determines that it is obligated to
disclose the other party's Confidential Information pursuant to an
Exchange Rule, the party receiving such order or bound by such
Exchange Rule shall immediately notify
15
the other party in writing of such service or determination and fully
comply with the provisions of Section 8(c) of this Agreement. Upon
termination or other expiration of this Agreement, all Confidential
Information disclosed by a party to a receiving party shall be
returned to the disclosing party or, upon the request of the
disclosing party, shall be promptly destroyed and certified as
destroyed by the receiving party; provided, however, that any RI Data
shall not be returned or destroyed, but shall be maintained in
accordance with this Agreement. The obligations of the parties under
this Section 8 shall survive the expiration or termination of this
Agreement.
(c) Notice of Orders Requiring Disclosure of Confidential Information.
Each party shall immediately notify the other party in writing of any
subpoena, order (judicial or administrative) or Exchange Rule
requiring disclosure of Confidential Information obtained from the
other party. The party whose Confidential Information is sought to be
disclosed may, at such party's cost, attempt to prevent or limit the
disclosure by appropriate legal means prior to any such disclosure
being made. Each party shall cooperate fully with the other party in
challenging any subpoena, order or Exchange Rule requiring disclosure
of Confidential Information.
(d) Equitable Remedies. The parties acknowledge and agree that irreparable
harm would result to a party upon any breach of the covenants
contained in this Section 8 by the other party and that damages
arising out of such breach may be difficult to ascertain. Therefore,
the parties agree that, in addition to all other remedies provided at
law or in equity, the non-breaching party may seek, without bond, from
a court of law or equity both temporary and permanent injunctive
relief to prevent a breach of any of such covenants.
9. INDEMNIFICATION AND REMEDIES
(a) Obligation to Indemnify. Each party (the "Indemnifying Party") shall
hold harmless, indemnify and defend the other party (the "Indemnified
Party") against all third party claims and shall pay all costs,
damages and attorneys' fees, arising out of or resulting from (i) any
breach by the Indemnifying Party of any of its representations,
warranties, covenants or agreements contained in this Agreement, or
(ii) any breach by the Indemnifying Party of the Act or other
Applicable Laws. Each party agrees that the provisions contained in
this Section 9 shall survive the termination or expiration of this
Agreement.
(b) Indemnification Procedures.
i. Promptly after receipt by any Indemnified Party under this
Section 9 of notice of the commencement or threatened
commencement of any action, proceeding or other claim by a third
party involving a claim in respect of which the Indemnified Party
will seek indemnification, the Indemnified Party shall notify the
Indemnifying Party of such claim in writing and
16
provide to the Indemnifying Party all reasonably available
information requested. Subject to the provisions of Section
9(c)(iv), no failure to so notify an Indemnifying Party shall
relieve it of its obligations under this Agreement except to the
extent that it can demonstrate damages attributable to such
failure. Within thirty (30) days following receipt of notice and
such reasonably available information from the Indemnified Party
relating to any claim, but no later than ten (10) days before the
date on which any response to a complaint or summons is due (the
applicable period referred to herein as the "Notice Period"), the
Indemnifying Party shall notify the Indemnified Party in writing
if the Indemnifying Party assumes full responsibility to
indemnify, defend and hold harmless the Indemnified Party and
elects to assume control of the defense and settlement of that
claim (a "Notice of Election"). During the Notice Period, the
Indemnified Party shall use commercially reasonable efforts to
extend the date on which a response to the claim is due until the
Indemnifying Party has provided its Notice of Election. The
Indemnifying Party shall be responsible for all costs and
expenses related to such claim (including reasonable legal fees
and disbursements and reasonable out-of-pocket costs of
investigation and litigation) incurred by the Indemnified Party
("Costs and Expenses") during the Notice Period if the
Indemnifying Party is obligated to indemnify the Indemnified
Party.
ii. If the Indemnifying Party delivers a Notice of Election relating
to any claim within the required Notice Period, the Indemnifying
Party shall be entitled to have sole control over the defense and
settlement of such claim; provided, however, that (i) the
Indemnified Party shall be entitled to participate in the defense
of such claim and to employ counsel at its own expense to assist
in the handling of such claim, and (ii) the Indemnifying Party
shall obtain the prior written approval of the Indemnified Party
before entering into any settlement of such claim or ceasing to
defend against such claim. The Indemnified Party shall not
unreasonably withhold its consent to any such settlement,
provided that it shall be deemed reasonable to withhold consent
if the settlement would cause harm to the reputation of the
Indemnified Party. After the Indemnifying Party has delivered a
Notice of Election relating to any claim in accordance with the
preceding paragraph, the Indemnifying Party shall not be liable
to the Indemnified Party for any legal expenses incurred by such
Indemnified Party in connection with the defense of that claim.
In addition, the Indemnifying Party shall not be required to
indemnify the Indemnified Party for any amount paid or payable by
such Indemnified Party in the settlement of any claim for which
the Indemnifying Party has delivered a timely Notice of Election
if such amount was agreed to without the written consent of the
Indemnifying Party.
iii. If the Indemnifying Party does not deliver a Notice of Election
relating to any claim within the Notice Period, or otherwise
fails to acknowledge its
17
indemnification obligations, the Indemnified Party shall have the
right to defend the claim in such manner as it may deem
appropriate, at the cost and expense of the Indemnifying Party.
The Indemnifying Party shall promptly reimburse the Indemnified
Party for all Costs and Expenses related to such claim. If no
Notice of Election is delivered, the Indemnified Party may settle
any such claim without the consent of the Indemnifying Party,
except that the Indemnified Party must use reasonable commercial
efforts to reduce the amount of any such settlement. If it is
determined that the Indemnifying Party failed to defend a claim
for which it was liable, the Indemnifying Party shall not be
entitled to challenge the amount of any settlement or compromise
paid by the Indemnified Party.
(c) Liability Limitations.
i. In no event shall Provider have any liability, whether based on
contract, tort (including, without limitation, negligence),
warranty or any other legal or equitable grounds, for any
punitive, special, or exemplary loss or damage suffered by
NDCHealth arising from or related to this Agreement even if
Provider is advised of the possibility of such losses or damages,
provided that these limitations shall not apply to consequential
damages or lost profits. Notwithstanding anything in this
Agreement to the contrary, in no event (1) shall Provider's
aggregate liability with respect to a single event or
circumstance giving rise to a claim for damages by NDCHealth
exceed $100,000 and (2) shall Provider's aggregate liability
pursuant to this Section 9 exceed $2,000,000.
ii. Without limiting NDCHealth's rights more specifically set forth
in Section 9(a) above, Provider acknowledges that any breach of
this Agreement by Provider will cause NDCHealth irreparable harm
the nature of which cannot be measured or remedied by monetary
damages alone and, accordingly, in the event of any breach of
this Agreement by Provider, NDCHealth shall be entitled to seek
equitable relief including, without limitation, specific
performance and injunctive relief.
iii. Without limiting Provider's rights more specifically set forth in
Section 9(a) above, NDCHealth acknowledges that any breach of
this Agreement by NDCHealth will cause Provider irreparable harm
the nature of which cannot be measured or remedied by monetary
damages alone and, accordingly, in the event of any breach of
this Agreement by NDCHealth, Provider shall be entitled to seek
equitable relief including, without limitation, specific
performance and injunctive relief.
iv. Notwithstanding anything contained herein, in no event shall the
Indemnifying Party be liable for indemnification pursuant to this
Section 9 if the Indemnified Party fails to provide notice to the
Indemnifying Party pursuant to Section 9(b)(i) within two (2)
years after the Indemnified Party
18
obtains knowledge of the event, act, fact or circumstances giving
rise to such claim.
10. DISPUTE RESOLUTION
All disputes arising under this Agreement that the parties' designated
representatives cannot first resolve by negotiating in good faith shall be
resolved by arbitration in accordance with the Commercial Arbitration Rules
(collectively, the "AAA Rules") of the American Arbitration Association.
Arbitration shall be by a panel of three arbitrators experienced in the
matters at issue and selected jointly by Provider and NDCHealth in
accordance with the AAA Rules. The arbitration shall be held in such place
in Charlotte, North Carolina as may be specified by the arbitrators (or any
place agreed to by Provider, NDCHealth, and the arbitrators). The decision
of the arbitrators shall be final and binding as to any matters submitted
under this Agreement and shall not be subject to judicial review. Judgment
on the arbitration award may be entered and enforced in any court having
jurisdiction over the parties or their assets. It is the intent of the
parties that the arbitration provisions hereof be enforced to the fullest
extent permitted by Applicable Laws. All costs and expenses incurred in
connection with any such arbitration proceeding (including reasonable
attorneys' fees) shall be borne by the party against which the decision is
rendered, or, if no decision is rendered, such costs and expenses
(including reasonable attorneys' fees) shall be borne by the party
incurring such costs and expenses. If the arbitrators' decision is a
compromise, the determination of which party bears the costs and expenses
incurred in connection with any such arbitration proceeding shall be made
by the arbitrators on the basis of the arbitrators' assessment of the
relative merits of the parties' positions. Nothing contained in this
Section 10 or elsewhere in this Agreement shall prevent or delay a party
from seeking injunctive relief of any issue for which injunctive relief is
sought by either party hereto.
11. NON-SOLICITATION
For a period of five (5) years after the Effective Date, NDCHealth shall
not solicit (other than through the use of general employment advertising
where such solicitation is not targeted at Provider's employees) or hire
any employees of Provider without the prior written consent of Provider;
provided, however, that (i) if Provider terminates an employee's employment
with Provider, with or without cause, the foregoing restrictions shall not
apply from and after the date of such employee's termination, and (ii) if
an employee of Provider terminates his or her employment with Provider,
NDCHealth may solicit and hire the former employee without the consent of
Provider at any time after twelve (12) months following such employee's
termination from Provider.
12. MISCELLANEOUS
(a) No waiver, modification or alteration of any of the provisions of this
Agreement shall be binding unless approved in writing by a duly
authorized representative of
19
the party to be so bound. Notwithstanding any provision of this
Agreement to the contrary, the parties agree to take such action as is
necessary to amend this Agreement from time to time as is necessary
for either party to comply with the requirements of the Act, including
the Privacy and Security Rules thereof, as amended from time to time,
and any privacy, security, or other administrative simplification
regulations promulgated pursuant thereto.
(b) This Agreement may not be assigned (by operation of law or otherwise)
by either party in whole or in part without the prior written consent
of the other party, which consent shall not be unreasonably withheld,
conditioned or delayed. Neither the merger of NDCHealth with Royal
Merger Co., nor the merger of WKHI with Provider, shall be deemed an
assignment of this Agreement or any right hereunder. Any assignment in
violation of this Section 12(b) shall be null and void.
(c) This Agreement shall be construed in accordance with the laws of the
State of Delaware, without regard to conflicts of laws provisions.
(d) All notices hereunder shall be in writing and shall be conclusively
deemed to have been received and shall be effective (i) on the day on
which delivered if delivered personally or transmitted by facsimile
transmission, (ii) one business day after the date on which the same
is delivered to a nationally recognized overnight courier service, or
(iii) three business days after being sent by registered or certified
United States mail, return receipt requested, and shall be addressed:
i. If to Provider, to:
NDC Health Information Services (Arizona) Inc.
c/o Wolters Kluwer Health, Inc.
000 Xxxxxx Xxxxxx, 0xx Xxxxx
Xxxxxxxxxxxx, XX 00000
Attn: Xxxxxxx X. XxXxxxxxx
Telephone: 000-000-0000
Facsimile: 000-000-0000
ii. If to NDCHealth, to:
NDCHealth Corporation
c/o Per-Se Technologies, Inc.
0000 Xxxxxxxxx Xxxxxxx, Xxxxx 000
Xxxxxxxxxx, Xxxxxxx 00000
Facsimile: (000) 000-0000
Attn: General Counsel
Either party may change its address for notices upon written notice to
the other party.
20
(e) Nothing in this Agreement shall be construed so as to constitute
Provider and NDCHealth as joint venturers, partners, or agents of each
other, and neither Provider nor Provider shall have the power to
obligate or bind the other in any way whatsoever.
(f) Neither party shall be deemed in default of this Agreement to the
extent that performance of its obligations or attempts to cure any
breach are delayed, restricted, or prevented by reason of any act of
God or Governmental Body, fire, natural disaster, labor stoppage, the
failure of necessary power systems or connections, or any other act or
condition beyond the reasonable control of the parties, provided that
the party so affected suspends performance only to the extent and for
the duration that is reasonably required by the force majeure event
and uses its commercially reasonable efforts to avoid or remove the
causes of non-performance and continues performance promptly after
those causes are avoided or removed.
(g) Headings and captions throughout this Agreement are inserted only as a
matter of convenience and for reference and they in no way define,
limit, or describe the scope of this Agreement or the intent of any
provision hereof.
(h) While the parties have used their best efforts to ensure that this
Agreement accurately reflects the commitments and undertakings
required of each in order to ensure an orderly transition of the
intercompany relationship of the parties without material disruption
to their respective businesses, they agree to cooperate in good faith
if after the Effective Date either party believes that it is
appropriate for the parties to take further actions or provide further
assurances, as may be reasonably required and agreed upon by the
parties to implement and give effect to the understandings of the
parties set forth herein. Without limiting the generality of the
foregoing, each party shall, at any time and from time to time,
execute, acknowledge and deliver or cause to be done, executed,
acknowledged and delivered, all such further documents, assurances or
things, and secure all necessary consents, as may be reasonably
required for the more perfect observance and performance by the
parties of the terms of this Agreement.
(i) Time is of the essence with respect the obligations of each of the
parties to this Agreement.
(j) This Agreement may be executed in two or more counterparts, each of
which shall be deemed an original and all of which together shall
constitute one and the same document.
(k) This Agreement constitutes the entire agreement between the parties
and supersedes all prior agreements, promises, proposals,
representations, understandings and negotiations, whether written or
oral, between the parties respecting the subject matter hereof.
21
(l) This Agreement shall be binding upon, and inure to the benefit of,
each party's authorized successors and assigns including any
successors or assigns to such party's business and assets.
(m) This Agreement shall not become effective unless and until the Data
Supply Agreement is duly executed and delivered by the parties.
13. CERTAIN DEFINITIONS
As used in this Agreement, the following terms shall have the following
meanings:
"AAA Rules" shall have the meaning ascribed to such term in Section 10 of this
Agreement.
"Act" shall mean the Health Insurance Portability and Accountability Act of
1996, as amended, and any regulations issued thereunder.
"Agreement" shall mean this Retail Informatics Data and Services Agreement and
all Exhibits and Schedules hereto.
"Applicable Laws" shall mean all applicable laws (including those arising under
common law), statutes, codes, rules, regulations, reporting or licensing
requirements, ordinances and other pronouncements having the effect of law of
the United States, any foreign country or any domestic or foreign state, county,
city or other political subdivision, including those promulgated, interpreted or
enforced by any Governmental Body.
"Biotechnology Firm" means an entity applying scientific techniques utilizing
living organisms, or substances from such organisms, to manufacture or modify
products for pharmaceutical use or to develop micro-organisms for specific
medical treatments.
"Certification" shall mean any RI Data Certification, Level I Certification,
Level II Certification, Level III Certification or Security Certification.
"Certified Product" shall mean a RI Data Product for which a Level II or Level
III Certification has been issued, and has not been revoked, pursuant to the
Data Security Requirements.
"Change in Control" shall mean any of the following, whether in a single
transaction or a series of related transactions: (a) (i) the merger,
consolidation or other business combination of a party with or into another
Person; (ii) the merger, consolidation or other business combination of another
Person with or into a party; or (iii) the acquisition by any Person of any
equity interests in a party, in each case with the effect that, immediately
after such transaction, the shareholders of such party immediately prior to such
transaction hold none of, or less than a majority in interest of, the total
voting power entitled to vote in the election of directors, managers or trustees
of the Person surviving such transaction or less than fifty percent of the
economic interests in such Person, or (b) the acquisition by any Person or
related group of Persons, by way of merger, sale, transfer, consolidation or
other business combination or acquisition of all or substantially all
22
of the assets, business or properties of a party. Notwithstanding the foregoing,
neither the merger of NDCHealth with Royal Merger Co., nor the merger of WKHI
with Provider, shall be deemed to be a "Change in Control" hereunder.
"Confidential Information" shall have the meaning ascribed to such term in
Section 8(a) of this Agreement.
"Costs and Expenses" shall have the meaning ascribed to such term in Section
9(b)(i) of this Agreement.
"Data Alteration Event" shall have the meaning ascribed to such term in Section
1(c)(ii) of this Agreement.
"Data Fees" shall mean the amounts set forth in Exhibit C attached hereto,
subject to the terms and limitations set forth in Exhibit C.
"Data Security Requirements" shall mean the procedures, certifications and
methods for processing, handling, storing and disclosing PHI Data Sets and RI
Data set forth in Exhibit B attached hereto.
"Data Supply Agreement" shall have the meaning ascribed to such term in the
Recitals of this Agreement.
"Data Suspension Event" shall have the meaning ascribed to such term in Section
4(b) of this Agreement.
"Effective Date" shall have the meaning ascribed to such term in the Preamble of
this Agreement.
"Encryption Engine" shall have the meaning ascribed to it in the Data Supply
Agreement.
"Exchange Rule" shall mean any rules of any exchange or other trading
environment in which the securities of a party are publicly traded.
"Governmental Body" means any government or governmental or regulatory body
thereof, or political subdivision thereof, whether federal, state, local or
foreign, or any agency, instrumentality or authority thereof, or any court or
arbitrator (public or private).
"Health Care Provider" shall have the meaning ascribed to such term in the Act.
"IM Business" shall have the meaning ascribed to such term in the Recitals of
this Agreement.
"IM Business Agreements" shall mean agreements between Provider and any other
Person entered into after the Effective Date which provide for the delivery to
Provider of PHI Data Sets; provided that the term IM Business Agreements shall
not include any agreement between
23
Provider and any other Person if such Person does not allow the use of such
Person's PHI Data Sets for retail pharmacy purposes.
"IM Field" shall mean the provision of IM Products to Pharmaceutical Companies,
Biotechnology Firms, Medical Device Manufacturers and Wall Street investment
analysts.
"IM Prescription Data" shall mean the retail prescription data that Provider
receives pursuant to IM Business Agreements.
"IM Products" shall mean the types of Products set forth on Exhibit D.
"IM Systems" shall mean the platforms and applications owned or otherwise
controlled by Provider, in their current or enhanced states, as set forth in
Exhibit E to this Agreement.
"Indemnified Party" shall have the meaning ascribed to such term in Section 9(a)
of this Agreement.
"Indemnifying Party" shall have the meaning ascribed to such term in Section
9(a) of this Agreement.
"Legacy RI Data" shall mean RI Data to which NDCHealth was afforded access on or
before the Effective Date.
"Legacy Product" shall mean an RI Data Product which contains Legacy RI Data and
which Provider had obtained Level III Certification on or before the Effective
Date, which certification remains valid.
"Level I Certification" shall mean a certification, made in accordance with
Level I of the Data Security Requirements, including all applicable Privacy and
Security Rules, that Purchased Data stored in the RI Data Repository and to
which NDCHealth is afforded access is de-identified in accordance with the Act,
including the Privacy and Security Rules.
"Level II Certification" in respect of any RI Data Product, shall mean a
certification, made in accordance with Level II of the Data Security
Requirements, including all applicable Privacy and Security Rules, that applying
generally accepted statistical and scientific methods for rendering information
not individually identifiable, the risk is Very Small that the RI Data included
in the RI Data Product could be used, alone or in combination with other
reasonably available information, by an anticipated recipient to identify an
individual who is a subject of the information.
"Level III Certification" in respect of any RI Data Product, shall mean a
certification, made in accordance with Level III of the Data Security
Requirements, including all applicable Privacy and Security Rules, that applying
generally accepted statistical and scientific methods for rendering information
not individually identifiable, the risk is Very Small that the RI Data included
in the RI Data Product could be used, alone or in combination with other
reasonably
24
available information, by an anticipated recipient to identify an individual who
is a subject of the information.
"Merger" shall have the meaning ascribed to such term in the Recitals of this
Agreement.
"NDC Data" shall mean the independent pharmacy data licensed from and supplied
by NDCHealth to Provider pursuant to the Data Supply Agreement.
"NDC Field" shall mean the (A) provision of network services to the Retail
Pharmacy Industry, Health Care Providers, non-governmental third party payers
and consumers and (B) provision or delivery of the types of products listed in:
(i) the Network Services Category, Provider Applications Category, and
Financial Services Transaction Processing Category set forth on
Exhibit F to the Retail Pharmacy Industry, Health Care Providers,
non-governmental third party payers and consumers;
(ii) the Patient Safety and Compliance Category and Other Messaging, Fraud
and Abuse Category, Key Account Agreements, Wall Street and Private
Equity Firms set forth on Exhibit F to Health Care Providers,
non-governmental third party payers and consumers.
(iii) the Information Management Category set forth on Exhibit F to the
Retail Pharmacy Industry and non-governmental third party payers;
(iv) the Longitudinal Record Category set forth on Exhibit F to
non-governmental third party payers and Health Care Providers.
(v) the Private Label PBM, Mail Order and Rebate Capture Category set
forth on Exhibit F to the Retail Pharmacy Industry.
"NDCHealth" shall have the meaning ascribed to such term in Preamble of this
Agreement.
"NDCHealth Certification" shall mean any Security Certification, Level II
Certification or Level III Certification.
"NDC Products" shall mean the types of products set forth on Exhibit F hereto.
"New Services" shall mean services provided by Provider to NDCHealth which
services either (i) were not provided prior to the Effective Date, but are
agreed upon by Provider and NDCHealth during the Term and thereafter provided by
Provider to NDCHealth, or (ii) constitute a modification of services to be
provided by Provider to NDCHealth as of the Effective Date pursuant to Sections
5(a) through 5(d).
"Notice of Election" shall have the meaning ascribed to such term in Section
9(b)(i) of this Agreement.
25
"Notice Period" shall have the meaning ascribed to such term in Section 9(b)(i)
of this Agreement.
"Patient" shall have meaning ascribed to such term in the Act.
"Patriot" shall have the meaning ascribed to such term in the Recitals of this
Agreement.
"Person" shall mean an individual, corporation, limited liability company,
partnership, trust, association, joint venture, unincorporated organization or
entity of any kind or nature, or a Governmental Body.
"PHI" shall mean protected health information, as that phrase is defined in the
Act.
"PHI Data Set" shall mean an original electronic record of a single transaction
or interaction (including, among other things, reject and reversal transactions,
hospital transaction data and physician claim data) between one Patient and one
Health Care Provider, or between two Health Care Providers, which record,
immediately prior to encryption and delivery to Provider, contains PHI or, if
associated with one or more other PHI Data Sets, could be used to determine PHI.
"Privacy and Security Rules" shall mean the Standards for Privacy of
Individually Identifiable Health Information at 45 C.F.R. part 160 and part 164,
subparts A and E, and the regulations promulgated thereunder; and the Security
Standards at 45 C.F.R. parts 160, 162 and 164, and the regulations promulgated
thereunder, in all cases, as in effect or amended from time to time.
"Prohibited Use" shall mean:
i. any offer for sale, sale, license, delivery, distribution or other
conveyance of any RI Data Product that does not constitute a Certified
Product at the time of such offer for sale, sale, license, delivery,
distribution or other conveyance;
ii. any use of the Purchased Data (whether alone or in combination with
any other data) to identify any pharmacy, hospital, payer or
individual; provided, however, that NDCHealth may use Purchased Data
to identify to a pharmacy or to a payer data that was provided by such
pharmacy or payer, respectively;
iii. any attempt, directly or indirectly, to derive PHI from any RI Data;
and
iv. any offer for sale, sale, license, delivery, distribution, other
conveyance or use of the Covered Data in a manner that violates this
Agreement, the Act or any other Applicable Laws.
"Provider" shall have the meaning ascribed to such term in the Preamble of this
Agreement.
"Provider Data Agreements" shall mean agreements between Provider and any other
Person which provides for the delivery to Provider of PHI Data Sets and the
terms of which Provider has determined, in its reasonable discretion, permit
Provider to license to NDCHealth the retail
26
prescription data provided pursuant to such agreement in the manner contemplated
by this Agreement.
"Provider's Data Center" shall mean the facility owned or otherwise controlled
by or on behalf of Provider and dedicated to receiving and processing RI Data in
connection with the conduct of the IM Business, which facility is, as of the
Effective Date, located at 0000 Xxxx Xxxxxxxxx Xxxx, Xxxxxxx, Arizona. Provider
shall notify NDCHealth in writing of any change in the physical location of
Provider's Data Center.
"Purchased Data" shall mean data that is obtained by Provider pursuant to
Provider Data Agreements.
"Purchaser" shall have the meaning ascribed to such term in the Recitals of this
Agreement.
"Qualified Statistician" shall mean a person with appropriate knowledge of and
experience with generally accepted statistical and scientific methods for
rendering information not individually identifiable.
"Retail Informatics Products" shall mean informatics products intended for use
in the Retail Pharmacy Industry or by any Health Care Provider, non-governmental
third party payer or consumer.
"Retail Pharmacy Industry" shall mean the business of owning or operating
establishments or operations where prescriptions are filled for consumers,
including without limitation, pharmacies, general merchandise stores, hospitals,
long-term care facilities, mail order and specialty operations and future
locations where prescription fulfillment and drug sales to consumers occur.
"Retail Prescription Data" shall mean the universe of all PHI Data Sets
generated in the Retail Pharmacy Industry.
"RI Data" shall mean pharmacy transaction data consisting of NDC Data and
Purchased Data that has been cleansed, aggregated, de-identified and presented
in a format more fully described and set forth in the Service Level Commitments.
"RI Data Access Protocol" shall mean the remote access to RI Data stored on the
RI Database Repository in accordance with the Service Level Commitments.
"RI Data Category" shall mean a particular type of RI Data sharing one or more
common attributes such as the identity of the entity from whom the RI Data is
received, a particular discrete item of PHI (e.g., date of birth) or other
identifiable characteristic.
"RI Data Certification" shall mean an annual written certification from a
Qualified Statistician that, provided the RI Data is used in accordance with the
terms and conditions of this Agreement, the risk is Very Small that the RI Data
could be used, alone or in combination with other reasonably available
information, by an anticipated recipient to identify an individual who is a
subject of the information.
27
"RI Data Product" shall mean any data, report, study, analysis, service or
product that includes, is based upon or derived from (whether alone or in
combination with any other data) any portion of the RI Data or any Legacy RI
Data.
"RI Data Repository" shall mean the databases, hosted on servers owned and
maintained by Provider or a third party on behalf of Provider, populated by
Provider with RI Data and Purchased Data pursuant to the terms of this
Agreement.
"Sale Transaction" shall have the meaning ascribed to such term in the Recitals
of this Agreement.
"Security Certification" shall mean a certification, made in accordance with the
Data Security Requirements, that all access, extraction, compilation,
assimilation, manipulation, analysis and other processing of the RI Data by the
party making such Certification, or by any Person acting on behalf of or at the
direction of, such party, is being conducted in compliance with the Act,
including the Privacy and Security Rules.
"Select Client Databases" shall mean those databases located, as of the
Effective Date, in Provider's Data Center, that both (i) will be relocated to
NDCHealth's facilities and (ii) pursuant to the terms of the Transition Services
Agreement, receive, as of the Effective Date, direct feeds of RI Data purchased
by Provider pursuant to data supply agreements between Provider and retail
pharmacies, which RI Data is used in connection with NDCHealth's "Retail
Insight" products.
"Service Level Commitments" shall mean the technical, qualitative, quantitative
and other standards and commitments, consistent with the standards and
commitments on the date hereof, examples of which are set forth and including
those set forth on Exhibit A attached hereto.
"Term" shall have the meaning ascribed to such term in Section 7(a) of this
Agreement.
"Very Small" shall have the meaning given it by the National Institute of
Standards and Technology, or such other standard as may be required from
time-to-time by the Act.
[Signatures on next page]
28
SIGNATURE PAGE
TO
RETAIL INFORMATICS DATA
AND SERVICES AGREEMENT
IN WITNESS WHEREOF, the parties hereto, each acting under due and proper
authority, have executed and delivered this Agreement as of the Effective Date.
Joinder for Purposes of Section 11. By execution below Per-Se Technologies, Inc.
does hereby agree that it and its Affiliates are, and shall be bound by the
provisions of Section 11 hereof and shall be liable to Provider and WKHI for any
breach of section 11 by Per-Se Technologies, Inc., NDCHealth or any of their
respective Affiliates
NDCHEALTH:
NDCHealth Corporation
By: /s/ Xxxxxxxx X.X. Xxxxx
------------------------------------
Name: Xxxxxxxx X.X. Xxxxx
Title: EVP
PER-SE TECHNOLOGIES, INC.: PROVIDER:
NDC Health Information Services
By: /s/ Xxxxxx X. Xxxx (Arizona) Inc.
---------------------------------
Name: Xxxxxx X. Xxxx
Title: President By: /s/ Xxxxxxxx X.X. Xxxxx
------------------------------------
Name: Xxxxxxxx X.X. Xxxxx
Title: EVP
