Exhibit 10.6
HEALTHEXTRAS INC.
July 8, 1997
Xx. Xxxxx X. Xxxx
Xxxxxxx Xxxxxx Agency, Inc.
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, XX 00000
Re: Final Terms And Conditions of the Agreement ("Agreement") Between
Cambria Productions, Inc. f/s/o Xxxxxxxxxxx Xxxxx and HealthExtras, Inc.
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Dear Xxxxx:
This shall serve as the terms and conditions of the Agreement executed this
8th day of July, 1997, by and between, Cambria Productions, Inc., hereinafter
referred to as "Lender", f/s/o Xxxxxxxxxxx Xxxxx, hereinafter referred to as
"Artist," and HealthExtras, Inc., hereinafter referred to as "Company", a
Delaware Corporation and affiliated company of United Payors & United Providers,
Inc. Execution by the parties shall constitute a binding Agreement.
PRODUCT: All HealthExtras, Inc. Cards
APPROVAL.: Artist shall have complete and absolute approval of
production and/or distribution of all scripts, storyboards,
still photography and other materials produced hereunder.
Artist shall have complete and absolute approval of
advertising usage of Artist's name, likeness and/or image.
Such approvals of materials and use of Artist's name or
likeness as recommended by Company shall be provided by
Artist's Company no later than five business days after
Artist's receipt of recommended materials to be approved. If
disapproval is not communicated to Company within this time
frame, then Company shall deem materials to be approved. If
Company and Artist fail to agree on content of materials
referenced above within ten working days after disapproval
by Artist, then either party may terminate the Agreement.
The terms and conditions of this Agreement shall remain
confidential for the duration of the Agreement and any
renewals except as required to authorized agents and
representatives who, upon receipt of such information, shall
also keep the same terms and conditions confidential. The
parties, their agents and representatives, further agree
that the existence of this Agreement shall not be disclosed
to anyone prior to September 2, 1997.
[FN]
* Removed pursuant to a confidentiality request.
Mr. Xxxxx Xxxx
July 8, 1997
Page 2
TERM: The initial term ("Term") of the Agreement shall be three
years commencing upon execution of this Agreement.
SERVICES: Lender shall make Artist available for up to three service
days, with up to two of these three days to fall within the
period of July 5, 1997 to August 5, 1997 (currently
scheduled for July 24th) to record one sixty-second on-
camera television commercial and one sixty-second radio
commercial and participate in a photography session to shoot
print. Scheduling for remaining day(s) will be mutually
agreed upon. Each day shall last no more than eight hours
including a two hour meal break. Artist's appearance on the
on-camera commercial shall last no more than twenty seconds.
Company shall have the right to create one additional
television and radio commercial per year as well as
additional print material. One additional day of Artist's
services will be made available to Company by Lender in each
of years two and three, with all new materials subject to
Artist's approval prior to usage thereof. In any case, no
more than two new T.V. commercials will be broadcast in any
year of this Agreement or renewals.
Company shall have the right to use Artist's name, testimony
and public statements in creating additional advertising
materials, but subject to Artist's approval of all materials
prior to usage thereof. All service days, other than those
referenced in the time frame indicated above in year one,
shall be at mutually agreeable dates, times and locations.
TERRITORY: United States, its possessions, territories and
commonwealths.
COMPENSATION: A guarantee of $[________]* payable as follows. Upon
execution of this Agreement, $ [_______]* will be paid to
Lender on behalf of Artist. On completion of the first T.V.
and Radio commercials and Print-ad photo session, that is on
or about August 1, 1997, Lender on behalf of Artist shall
receive $ [________]*. Thereafter, Lender on behalf of
Artist shall receive $ [________]* on January 15, 1998;
$ [________]* on July 15, 1998; and, a final payment under
the initial Term of the Agreement of $ [________]* paid to
Lender on behalf of Artist on January 15, 1999. The portion
of the guarantee associated with payments for television and
radio commercials shall applied against any and all payments
due under the applicable union agreement including, without
limitation, double scale session use and holding fees.
*Removed pursuant to a confidentiality request.
Mr. Xxxxx Xxxx
July 8, 1997
Page 3
In the event that any portion of the guaranteed payment or
other payments due under this Agreement are not received
within thirty days of its due date, Lender shall have the
absolute right to terminate this Agreement immediately upon
giving notice to Company. In the event of such termination
for non-payment, Company and its agents and employers, agree
that it will not use any materials previously created, which
includes any name, likeness or endorsement by Artist to
promote any HealthExtras, Inc. products. In addition, Lender
and/or Artist shall be entitled to injunctive relief to
prevent the use of any such material. Any cost and/or legal
fees incurred by Lender or Artist in effecting such
injunctive relief, shall be repaid in their entirety by
Company to Artist and/or Lender.
Company shall pay Lender on behalf of Artist $ [____]* per
card, per year, for all dual purpose health benefits and
credit cards, to include any cards that may be promoted by
Artist and issued through HealthExtras, Inc. to cardholders
that subscribe to the card benefits to be promoted
hereunder. A synopsis of those benefits that may be
initially promoted by Artist are attached as Exhibit A to
the Agreement and made a part thereof. Such payments to
Lender on behalf of Artist shall continue for a ten year
period commencing upon completion of the initial three year
Term. If the Two Year Option hereunder is exercised, such
$ [____]* per card, per year payments shall commence upon
completion of the Two Year Option. Payments shall be made
within sixty days of the end of each year, accompanied by a
detailed accounting.
In the event that the amount of $ [____]* per card, per
year, for all cards issued through HeathExtras, Inc.
programs (as referenced above) to cardholders that subscribe
to the benefits promoted by Artist hereunder exceeds the sum
of $ [________]* for any year of the Term, or any year of
the Two Year Option if exercised, then Lender on behalf of
Artist shall receive the amount in excess of $ [________]*,
within sixty days of the end of such year. Company shall
provide Lender with a detailed accounting of number of
subscribers enlisted yearly along with such payment, if any.
[FN]
* Removed pursuant to a confidentiality request.
Mr. Xxxxx Xxxx
July 8, 1997
Page 4
Lender's authorized representatives may, upon reasonable
notice, audit Company's relevant books and records to verify
the number of cards issued and such payments.
USE: During the Term or Two Year Option, and within the Territory
only, the Company shall have the exclusive right to use
broadcast television and radio, Internet and print,
including newspapers, magazines, direct mail and other
consumer print materials but excluding life-size cut-outs,
billboards and shelf or aisle-facing packaging. Company
shall have the usage right of all materials produced
hereunder for the Term of this Agreement plus the Two Year
Option period, if applicable, and ten year annuity period
thereafter.
EXCLUSIVITY: During the Term and within the Territory, Lender shall
insure that Artist shall not promote, render services in
commercials, or endorse any other product that combines
credit cards and health related benefits. Notwithstanding
the foregoing, Artist may render services during the Term in
the entertainment portions of any program, theatrical
production, television presentation, motion picture, etc.
even if said performance is sponsored by competitive
products, companies and/or services, and Artist may record
and/or appear in network and cable promotions featuring
appearances by Artist.
EXPENSES: The rider attached hereto is by this reference made part
hereof.
NOTIFICATION: Option for additional Two Year Term shall be exercised in
writing and received by the Xxxxxxx Xxxxxx Agency offices no
later than sixty days prior to the expiration of the third
year of the Term.
TWO YEAR
OPTION: A guarantee of $ [________]*, payable to Lender on behalf of
Artist in increments of $ [________]* per year at the
commencement of each year. Lender on behalf of Artist, shall
continue to be eligible to receive the $ [____]* per card,
per year, payments as described in paragraph three of the
"Compensation" section of this Agreement. All other terms
and conditions shall remain the same as in the initial Term
including services. If the Two Year Option is exercised by
the Company, Lender on behalf of Artist shall have the right
to disapprove such exercise and the Two Year Option shall be
deemed not to have been exercised.
[FN]
* Removed pursuant to a confidentiality request.
*
Mr. Xxxxx Xxxx
July 8, 1997
Page 5
ADDITIONAL
DAYS: Lender on behalf of Artist shall receive a guarantee of
$ [_____]* for each additional day of service requested by
Company. Company shall be entitled to one additional day per
year during the Term, and Two Year Option if exercised.
Payment shall be made upon completion of services. Each such
day shall not exceed eight hours each in duration, including
a two hour meal break.
SIGNATORY: Company is and will remain during the Term(s) a signatory to
the applicable union(s) having jurisdiction over Artist's
services hereunder.
PENSION
& WELFARE: Company will pay applicable union Pension & Welfare
contributions on behalf of Artist directly to the union and
will send the Xxxxxxx Xxxxxx Agency office verification that
the payments have been made.
INDEMNITY
& INSURANCE: Company shall indemnify Lender and Artist and his agents,
affiliates, subsidiaries and related entities, against any
and all claims, settlements, penalties, damages, expenses,
attorney's fees, costs, and judgments obtained against,
imposed upon or suffered by Lender and/or Artist by reason
of this Agreement, including but not limited to a breach or
alleged breach by Company and/or their obligations hereunder
and the use and/or content of the materials produced
hereunder and the products and services advertised therein
and thereby. In addition, Company shall name Lender and
Artist as additional insureds under Company's comprehensive
general liability insurance policies, including but not
limited to products liability, errors and omissions, and an
extended liability endorsement (including advertising
liability), and shall provide Lender and Artist with
certificates of insurance evidencing such coverage, and
prior written notice of any termination thereof. Such
insurance shall be maintained for the length of the Term,
Two Year Option if applicable, Annuity Period, and one year
thereafter.
PAYMENT: All payments will be made to and in the name of XXXXXXX
XXXXXX AGENCY, INC. as agent for Artist and remitted to
Xxxxxxx Xxxxxx Agency, 0000 Xxxxxx xx xxx Xxxxxxxx, Xxx
Xxxx, XX 00000 Attn: Xxxxx X. Xxxx.
[FN]
* Removed pursuant to a confidentiality request.
Mr. Xxxxx Xxxx
July 8, 1997
Page 6
NOTICES: Notices for Lender and Artist will be sent to: Artist c/o
Xxxxxxx Xxxxxx Agency, Inc., 0000 Xxxxxx xx xxx Xxxxxxxx,
Xxx Xxxx, XX 00000, Attn: Xxxxx X. Xxxx. Notices for Company
will be sent to HealthExtras, Inc., 0000 Xxxxxxxx Xxxxxxxxx,
Xxxxxxxxx, XX 00000, Attn: Xxxxxx Xxxx.
This Agreement supersedes and replaces any prior negotiations or Agreements
either written or verbal. In executing this Agreement through their authorized
signatories as indicated below, the parties agree to the terms and conditions as
stated herein.
For: HealthExtras, Inc. For: Cambria Productions, Inc.
f/s/o Xxxxxxxxxxx Xxxxx
/s/ Xxxxxxx X. Xxxxxx /s/ Xxxx Xxxxx
--------------------- -----------------------------
Title: President Title: Assistant Secretary
EXHIBIT A
Synopsis of Health Benefit Descriptions
Additional Lifetime Coverage: When the cardholders exhausts his/her lifetime
limit of at least $1,000,000, then he/she will receive an additional $5,000,000
in health plan coverage.
Catastrophic Injury and Disability: If the cardholder becomes totally and
permanently disabled, by accident, wherein he/she is prevented from attending to
their business or occupation, he/she will receive $1,000,000 lump sum payment
after twelve months of continuing disability.
Job Loss Coverage: If the cardholder losses his/her job (either fired or laid
off), then they will receive $400 per month for up to 6 months, while they seek
employment. Cardholder, over 18 years old, must be employed for 9 consecutive
months by the same employer to be eligible.
Organ Transplant: The cardholder and family are eligible receive $250,000 for
those expenses for Organ Transplants that exceed their base plan coverage of
$250,000.
Out of Area Coverage: Provides cardholder and his/her family with $2,500 per
year in additional coverage, over and above their standard health plan coverage,
for reimbursement of co-pay and deductibles when over 100 miles from home.
Nurse-On-Call: General health care advocacy and medical information and
referral recommendations (where appropriate to UP&UP Network providers) provided
to cardholder and family 24 hours per day, 7 days per week by telephone from
centralized nursing staff.
Emergency Evacuation, Repatriation and Return of Mortal Remains: Provides
cardholder and his/her family with access to worldwide emergency care,
relocating cardholder and/or their family to closest provider or facility
appropriate to deliver emergency care required. Coverage provides return of
cardholder and his/her family to home by way of emergency medical transport if
required. Provides for return of mortal remains to home upon death. Benefit
provides for a $50,000 cap.
Worldwide Travel and Emergency Assistance: Provides cardholders and his/her
family with access to emergency travel assistance including: credit card
replacement, worldwide legal assistance, lost document assistance, emergency
travel arrangements, return of minor children, Embassy and Consular assistance.
HEALTHEXTRAS
0000 Xxxxxxxx Xxxxxxxxx
Xxxxx Xxxxx
Xxxxxxxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (301) 548-8844
May 27, 1999
Xx. Xxxx Xxxxx By Facsimile to: 212.903.1489
Cambria Productions, Inc. and by Federal Express
f/s/o Xxxxxxxxxxx Xxxxx
0000 Xxxxxxxx, Xxxxx 000
Xxx Xxxx, XX 00000
Mr. Xxxxx Xxxx
Xxxxxxx Xxxxxx Agency, Inc.
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, XX 100 19
Dear Xxxx and Xxxxx:
The terms of the July 8, 1997 Agreement ("Agreement") by and between Cambria
Productions, Inc. f/s/o, Xxxxxxxxxxx Xxxxx and HealthExtras contains an Option
for Additional Two Year Term ("Two Year Option"). This Two Year Option states
that the terms and conditions of that Agreement will be extended for an
additional two years, commencing July 9, 2000.
This letter shall serve as written notification of HealthExtras intent to
exercise this Two Year Option under the terms contained in the Agreement and
when signed below by Cambria Productions, Inc., will indicate Cambria's approval
of the exercise of the option period.
Concurrently, the Agreement shall be amended such that compensation to Lender on
behalf of Artist will be changed from "$[___]* per card" to "$[___]* per
enrollee" per year for all customers subscribing to the insurance benefits
promoted by the artist and issued through HealthExtras, Inc. This Amendment to
the Agreement is retroactive to July 8, 1997 and prospective through the
remaining term of the Agreement and the Two Year Option.
Additionally, the Agreement shall be amended to increase the number of radio
recording spots to two per year through the term of the Two Year Option.
[FN]
* Removed pursuant to confidentiality request.
Xx. Xxxx Xxxxx
Mr. Xxxxx Xxxx
May 27, 1999
Page 2 of 2
The following wording of the first sentence under the two year option clause of
the original agreement shall be changed to read as follows: "A guarantee of $
2,000,000 payable to Lender in increments of $ 1,000,000 per year, shall be
payable at the commencement of each year (July 2000 and July 2001). The payments
shall be due no later than July 15 of each option year. If a payment is not
received in a timely manner, Lender on behalf of the artist reserves the right
to terminate the contract immediately and in addition to its other rights
pursuant to the contract, Lender may cancel the approval of the remaining option
period. In the event of such a cancellation, Company shall continue to be
responsible for the deferred compensation of $[***] per enrollee per year as
described above." The balance of that paragraph shall be unchanged.
Sincerely,
/s/ Xxxxxxx X. Xxxxxx
--------------------------
Xxxxxxx X. Xxxxxx
MCM/dw
The undersigned agree to exercise the terms of the Two Year Option as contained
in the Agreement.
/s/ Xxxxxxx X. Xxxxxx /s/ Xxxx Xxxxx
------------------------------ ------------------------------------
Xxxxxxx X. Xxxxxx Xxxx Xxxxx
For: HealthExtras, LLC For: Cambria Productions, Inc.
f/s/o Xxxxxxxxxxx Xxxxx
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* Removed pursuant to a confidentiality request.
