AGREEMENT
AGREEMENT
THIS
Agreement (the "Agreement") is made and entered into on February 5, 2007 by
and
between HSA Bank®
a division of Xxxxxxx Bank, N.A. (“HSA”), and Medefile International, Inc., a
Nevada corporation (“Medefile” or the “Company”).
W
I T
N E S S E T H:
WHEREAS,
Medefile
sells memberships to electronically store and provide access to customer medical
records; and
WHEREAS,
HSA
desires to offer Medefile memberships to its clients and employees who are
referred to Medefile by HSA under the terms of this Agreement (the “HSA
Members”) by including information regarding Medefile in mailings, newsletters,
emails and other communications; and
NOW,
THEREFORE,
in
consideration of the mutual premises, covenants and Agreements hereinafter
set
forth, the parties hereby agree as follows:
1. Sales
Arrangement.
The
Company hereby authorizes HSA to solicit memberships for Medefile’s services
(“Memberships”) from time to time during the term of this Agreement. HSA shall
place a hyperlink from its website to the Company’s website, which will enable
HSA Members to sign up for Medefile’s service at the discounted rate set forth
in Schedule A hereto.
2. Term.
This
Agreement shall remain in force and effect for a term of one (1) year (the
"Term") commencing on the date hereof, subject to prior termination by mutual
agreement of the parties hereto or hereinafter provided. Subject to the
Company’s right to terminate the Agreement prior to the expiration of the Term
as enumerated in Section 5 herein below, the Term shall automatically renew
for
additional one-year terms unless either party delivers written notice to the
other party of the intent to not renew this Agreement, which notice shall be
delivered on or prior to ninety (90) days before such renewal date, or is
terminated under paragraph 4.1 of this Agreement.
3. Price
of Memberships, Payment Processing and Compensation.
3.1 Medefile
agrees to sell Medefile memberships to HSA Members at a discounted rate to
be
determined by HSA, as set forth in Schedule A hereto (the “Discounted Rate”).
The Discounted Rate shall be no
lower
than
$100 and no
higher
than
$199. Medefile will waive its customary activation fee for HSA Members. These
individuals shall be identified via application forms (paper or electronic)
which contain information indicating HSA as the source of such
individuals.
3.2 For
each
Medefile membership sold to HSA Members, the Company will retain $100. For
each
Medefile membership sold to HSA Members, the Company will pay to HSA the
difference between $100 and the Discounted Rate (the “Revenue
Share”).
3.3
Medefile
will distribute the Revenue Share as follows:
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(i) For
memberships that are paid in advance, revenue share will be distributed in
full
on the appropriate schedule.
(ii) For
memberships that are purchased through financing and for monthly paying
accounts, Medefile will distribute the Revenue Share on a pro rata basis as
the
fees are collected.
Medefile
will reconcile all sales for the preceding month on the first day of the next
month. Medefile will provide HSA Bank with a reconciliation report five (5)
days
later. Any revenue share owed to HSA Bank will be paid on the first of the
following month (e.g. for month ended September 30, Company reconciliation
will
occur on October 1, a report will be delivered to HSA Bank by October 5 and
payment shall be made on November 1).
4. Termination.
4.1 Termination
by Either Party Without Cause.
This
Agreement may be terminated by either party at any time upon thirty (30) days
written notice to the other party.
4.2 Termination
by Either Party for Cause.
This
Agreement may be terminated by either party for Cause as described herein.
For
purposes of this Agreement, "cause" shall mean:
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(i)
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breach
of any of the provisions of this Agreement; the breaching party shall
be
give 30 days to cure such breach after notice
thereof.
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(ii)
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failure
by a party to comply in any material respect with the terms of any
provision contained in this Agreement, if any, or any written policies
or
directives of the Company’s senior
management.
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(iii)
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a
party is convicted of, pleads guilty to, confesses to any felony
or any
act of fraud, misappropriation or
embezzlement
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(iv)
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a
party engages in a fraudulent act or dishonest act to the damage
or
prejudice of the other party and its affiliates or engages in conduct
or
activities damaging to the property, business or reputation of the
other
party and its affiliates, all as determined by the non-breaching
party in
good faith.
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| (v) |
a
party’s willful malfeasance or gross negligence.
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(vi)
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Any
material misrepresentation or conceal-ment of a material fact made
by
either party in connection with this Agreement.
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| (vii) |
Breach
of any covenant made by either party hereunder.
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| (viii) |
The
failure by either party substantially to perform its duties or obligations
hereunder, within 30 days after notice of such
failure.
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| (ix) |
a
party engaging in misconduct that is materially injurious to the
other.
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| (x) |
a
party engaging in any act that in any way has a direct, substantial,
and
adverse effect on the other party’s
reputation.
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| (xi) |
a
party’s conviction, or entry of a plea of guilty or nolo contendere,
in
a court of competent jurisdiction, for a crime constituting a
felony.
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| (xii) |
A
party (i) voluntarily files for bankruptcy or makes an assignment
for the
benefit of its creditors, admits in writing its inability to pay
its debts
generally as they become due or consents to the appointment of a
receiver,
trustee, liquidator or conservator for it or any part of its property;
(ii) has a receiver, liquidator or trustee appointed by court order
and
such order remains in effect for more than ninety (90) calendar days,
or a
receivership, insolvency or bankruptcy proceeding is commenced or
a
petition is filed against such party under any applicable liquidation,
conservatorship, bankruptcy, moratorium, insolvency, reorganization
or
similar law for the relief of debtors; (iii) commences dissolution,
liquidation or otherwise winding up its business, (iv) is named as
a
defendant in any involuntarily bankruptcy or insolvency proceeding
by any
creditor.
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4.3 Effect
of Termination.
| (i) |
For
a period of twenty four (24) months after the date of any termination
notice delivered by the Company pursuant to Section 4.1 herein, HSA
shall
remain entitled to compensation for fees generated and collected
from
memberships sold to HSA Members by Medefile prior to termination
of the
Agreement.
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| (ii) |
Upon
termination of this Agreement by HSA pursuant to Section 4.1 herein,
the
parties expressly acknowledge and agree that the Company shall have
no
further obligation to pay HSA for any compensation accrued prior
to or
subsequent to termination of the Agreement. Further, the parties
expressly
acknowledge and agree that the Company shall have no further obligation
to
pay HSA for any renewals for any memberships sold to HSA Members
during
the Term of the Agreement.
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3
| (iii) |
Upon
termination of this Agreement by the Company pursuant to Section
4.2
herein, the parties expressly acknowledge and agree that the Company
shall
have no further obligation to pay HSA for any compensation accrued
prior
to or subsequent to termination of the Agreement. the parties expressly
acknowledge and agree that the Company shall have no further obligation
to
pay HSA for any renewals for any memberships sold to HSA Members
during
the Term of the Agreement.
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| (iv) |
Upon
termination of this Agreement by HSA pursuant to Section 4.2 herein,
the
parties expressly acknowledge and agree that, for a period of twelve
(12)
months after the date of any termination notice delivered by HSA
pursuant
to Section 4.2 herein, HSA shall remain entitled to compensation
for fees
generated and collected from memberships sold to HSA Members by Medefile
prior to termination of the
Agreement.
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5. General
Provisions.
5.1 Notices.
All
notices required to be given under the terms of this Agreement shall be in
writing and shall be deemed to have been duly given only if delivered to the
addressee in person, mailed by certified mail, return receipt requested, or
via
facsimile with proof of receipt retained by sender, to the address as included
in the signature page to this Agreement or to any such other address as the
party to receive the notice shall advise by due notice given in accordance
with
this paragraph. Any party hereto may change its or his address for the purpose
of receiving notices, demands and other communications as herein provided,
by a
written notice given in the manner aforesaid to the other party
hereto.
5.2 Benefit
of Agreement and Assignment.
This
Agreement inures to the benefit of and is binding upon the parties hereto and
their respective executors, administrators, successors and assigns; provided,
however, that neither party may assign any of its rights or duties hereunder
except upon the prior written consent by the authorized representatives of
the
other party.
5.3 Applicable
Law. This
Agreement is made in and is to be governed by and construed under the laws
of
the State of New York.
5.4 Captions.
The
captions appearing at the commencement of the sections hereof are descriptive
only and for convenience of reference only and are not intended to be part
of or
to affect the meaning or interpretation of this Agreement.
5.5 Severability.
In the
event that any one or more of the provisions contained in this Agreement or
in
any other instrument referred to herein, shall, for any reason, be held to
be
invalid, illegal or unenforceable in any respect, then to the maximum extent
permitted by law, such invalidity, illegality or unenforceability shall not
affect any other provision of this Agreement or any other such
instrument.
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5.6 Entire
Agreement.
This
Agreement contains the entire Agreement of the parties, and supersedes any
and
all other Agreements, either oral or in writing, between the parties hereto
with
respect to the subject matter hereof. Each party to this Agreement acknowledges
that no representations, inducements, promises, or Agreements, oral or
otherwise, have been made by either party, or anyone acting on behalf of either
party, which are not embodied herein, and that no other Agreement, statement
or
promise not contained in this Agreement shall be valid or binding.
5.7 Amendments.
This
Agreement may be modified or amended only by an Agreement in writing signed
by
the Company and HSA.
5.8 Waiver.
No
waiver of any provision hereof shall be valid unless made in writing and signed
by the party making the waiver. No waiver of any provision of this Agreement
shall constitute a waiver of any other provision, whether or not similar, nor
shall any waiver constitute a continuing waiver.
5.9
Representations
and Warranties.
Each
party hereto represents and warrants that it has the power and authority to
execute and deliver this Agreement and to perform its or his obligations
hereunder.
5.11
Arbitration.
Any
dispute or controversy arising under or in connection with this Agreement,
other
than matters pertaining to injunctive relief, including, without limitation,
temporary restraining orders, preliminary injunctions and permanent injunctions,
shall, upon the written demand of either party served upon the other party,
be
submitted to arbitration. Such arbitration shall be held in the City of New
York, New York (unless otherwise agreed by the parties), and conducted in
accordance with the Rules of the American Arbitration Association.
5.12
Advice
of Counsel.
Each
party
acknowledges and represents that: (a) it has read the Agreement; (b) it clearly
understands the Agreement and each of its terms; (c) it fully and
unconditionally consents to the terms of this Agreement; (d) it has had the
benefit and advice of counsel of their own selection; (e) it has executed this
Agreement, freely, with knowledge, and without influence or duress; (f) it
is
not relying upon any other representations, either written or oral, express
or
implied, made to them by any person; and (g) the consideration received by
it
has been actual and adequate.
6. Indemnification.
6.1 Parties
represent that they comply with all respective applicable laws and regulations,
including, without limitation, all anti-spam laws and regulations and that
each
party’s performance pursuant to the terms of this Agreement will not violate any
laws or regulations governing the use of emails or the Internet.
6.2 HSA
agrees to indemnify and hold harmless, Medefile, its officers, directors,
agents, shareholders, subsidiaries and affiliates (collectively, “Medefile”)
against any liability, loss, damages, claim, settlement payment, cost and
expense, interest, award, judgment, diminution in value, fine, fee, and penalty,
or other charge, other than Litigation Expenses (as defined in 6.4), arising
out
of and relating to HSA’s performance under this Agreement or any agreements
between HSA and HSA Members.
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6.3 Medefile
agrees to indemnify and hold harmless, HSA, its officers, directors, agents,
shareholders, subsidiaries and affiliates against any liability, loss, damages,
claim, settlement payment, cost and expense, interest, award, judgment,
diminution in value, fine, fee, and penalty, or other charge, other than
Litigation Expenses (as defined in 6.4), arising out of and relating to
Medefile’s performance under this Agreement or any agreements between Medefile
and HSA Members.
6.4 “Litigation
Expenses” means any court filing fee, court cost, arbitration fee or cost, and
any other fee and cost of investigating and defending, or asserting any claim
for indemnification under this Agreement, including in each case, attorney’s
fees, other professionals’ fees and disbursements
7. Confidentiality
and Non-Competition Covenants
7.1
Safeguarding
Requirements.
The
Xxxxx-Xxxxx-Xxxxxx (“GLB”) Act requires financial institutions to create
safeguards for customer records and information. The objectives of the
safeguards are to (1) insure the security and confidentiality of customer
records and information; (2) protect against any anticipated threats or hazards
to the security or integrity of such records; (3) detect unauthorized access
to
or use of such records or information and (4) protect against unauthorized
access to or use of such records or information that would result in substantial
harm or inconvenience to any customer (the “Safeguarding Objectives”). In order
to implement these safeguarding requirements, financial institutions are
required to have written contracts with their service providers (any person
or
entity that maintains, processes, or otherwise is permitted access to customer
information) that require the service provider implement appropriate measures
designed to meet the Safeguarding Objectives.
7.2 Safeguards.
The
Company represents and agrees that it has and will maintain in place
commercially reasonable precautions to safeguard the confidentiality, security
and integrity of Confidential Information in a manner designed to meet the
Safeguarding Objectives. These precautions shall include (A) contractual
restrictions on access to the information by vendors and companies, (B)
Intrusion detection systems on all information systems of HSA maintained or
controlled by Company, and (C) notification procedures for notifying HSA
promptly in the event a security breach is detected or suspected, as well as
other response programs when there is a suspected or detected unauthorized
disclosure, access or attempted access of Customer Information. These
precautions shall include, as appropriate: (i) access controls to customer
information systems, including controls to identify and permit access only
to
authorized individuals and controls to prevent access to Customer Information
through fraudulent means; (ii) employee controls and training; (iii) physical
access restrictions at locations where Customer Information is located; (iv)
encryption of electronic Customer Information when appropriate or legally
required; and (v) a disaster recovery plan as appropriate to protect against
loss or damage to Customer Information due to potential hazards such as fire
or
water damage or technological failures. Company agrees that it will (i) monitor
the foregoing measures with periodic audits or testing and (ii) provide copies
of the same sufficient to assure to HSA or its regulatory authorities that
Company is implementing provisions of this Safeguarding Agreement.
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7.3 Confidentiality
Requirements.
The
parties hereto acknowledge that in the general course of doing business under
this Agreement, each party may disclose information to the other party that
is
deemed confidential and is not subject to disclosure to third parties. Unless
previously indicated in writing by the party making the disclosure, all
information disclosed by either party pursuant to this Agreement is to be
considered strictly confidential and the parties hereto will use commercially
reasonable efforts to maintain such information as strictly confidential and
to
inform their respective officers, directors, employees and agents of the
strictly confidential status of such information. The obligations of this
paragraph shall not apply, however, to any information which (a) is already
in
the public domain at the time of disclosure or later becomes available to the
public through no breach of the Agreement by the recipient; (b) was, as between
the recipient and the party making the disclosure, lawfully in the recipient's
possession prior to receipt from the party making the disclosure without
obligation of confidentiality; (c) is received by the recipient independently
from a third party free to lawfully disclose such information to the recipient;
or (d) is subsequently independently developed by the recipient as evidenced
by
its business records.
Parties
agree to (a) use reasonable care to maintain the confidentiality of Confidential
Information and limit its disclosure to only such of its Representatives as
have
a need to know such Confidential Information in order to conduct the
Discussions; (b) be responsible for the compliance by its Representatives with
the provisions of this Agreement; (c) not copy Confidential Information for
any
purpose other than as necessary to provide agreed-upon services to HSA; (d)
Not
use any Confidential Information for any purpose other than as necessary to
provide agreed-upon services under this Agreement; (e) not discuss or disclose
Confidential Information except as authorized by this Agreement or as expressly
authorized by HSA; and (f) promptly report to HSA any actual or suspected
violation of the terms of this Agreement and take all reasonable further steps
as required by HSA to prevent, control or remedy any such
violation.
7.4
Notification
of Required Disclosure.
Notwithstanding the foregoing, each party shall have the right to disclose
and
disseminate Confidential Information to third parties as required by law or
by a
court order, provided that prior to any such disclosure or dissemination, the
party disclosing or disseminating the Confidential Information shall notify
the
other party and the other shall have the opportunity, at its own cost, to
contest such disclosure or dissemination by appropriate proceedings. HSA shall
also have the right to disclose Confidential Information to its internal and
external auditors and legal counsel if such disclosure is required by law and
the auditors and legal counsel are subject to the nondisclosure provisions
of
Section 7.3 hereto.
7.5 Notification
of Security Breach.
The
Company agrees that in the event the Company becomes aware of the occurrence
of
a breach of security with respect to Confidential Information, the Company
will
immediately notify HSA in writing, of the breach, the extent of the breach,
and
possible consequences of the breach. The Company shall undertake all reasonable
actions under the circumstances to respond to the breach and to assure HSA
that
the Company has made its best effort to mitigate any damages that may result
from the breach. This provision shall survive the termination or expiration
of
this Agreement.
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7.6 Return
of Documents.
Upon
the expiration or termination of this Agreement, parties shall not remove,
without written consent of the other, any manuals, files, agreements, contracts,
records, customer lists, any other documents of similar nature, or any copy
or
other reproduction thereof, or any other property or confidential information,
of or pertaining to the other party or any of its subsidiaries. The parties
shall return all of the preceding items provided by the other within 30 days
of
expiration or termination of this Agreement.
[SIGNATURE
PAGE FOLLOWS]
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IN
WITNESS WHEREOF, this Agreement is executed by the parties’ authorized
representatives below, on the day and year first above written.
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0
Xxxxxxxxx Xxxxxx, Xxxxx 000
Xxxxx
Xxxxxx, XX 00000
Facsimile:
(000) 000-0000
By: /s/
Xxxxxx Xxxxxx
Name:
Xxxxxx Xxxxxx
Title:
Chief Executive Officer
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HSA
BANK®
a
division of Xxxxxxx Bank, N.A.
000
X 0xx
Xx
000
Xxxxxxxxx
XX 00000
Facsimile:
(000) 000-0000
By: /s/Xxxx
Xxxxxxxx
Name: Xxxx
Xxxxxxxx
Title:
President
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SCHEDULE
A
DISCOUNTED
RATE
10
