EXHIBIT 10.2
MANAGEMENT SERVICES AGREEMENT
THIS MANAGEMENT SERVICES AGREEMENT, dated January 28, 2005, but effective
as of October 15, 2004 by and between Union Dental Corporation, a Florida
corporation ("UDC") and Xxxxxx X. Xxxxx, D.D.S., P.A., a Florida professional
association (the "Practice").
RECITALS
A. UDC engages in the business of managing dental practices, including
providing space, equipment, furnishings and certain administrative personnel
necessary for the operation of dental practices.
B. The Practice is a professional association which has as its shareholders
and/or employees physicians who are duly licensed to practice dentistry in the
State of Florida.
C. The Practice desires to engage UDC to provide management services to the
Practice in order to enable the Practice to devote its efforts on a concentrated
and continuous basis to the rendering of dental services to its patients.
D. The Practice and UDC desire to enter into a written agreement to provide
a full statement of their respective rights and responsibilities during the term
of this Agreement.
The parties or agree as follows:
1. Definitions For purposes of the Agreement, the following terms shall
have the meanings ascribed to them below:
1. Bank shall mean, Xxxxxx X. Xxxxx, D.D.S., P.A. at Community Bank of
Broward.
2. Bank Account shall mean the bank account referred to in Section 1.1
of this Agreement of which the Practice shall be the sole owner from which
UDC shall have the sole right to make withdrawals.
3. Business Plans and Budgets shall mean the annual business plan and
related budgets referred to in Section 2.2 hereof.
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4. Fees shall mean the furniture, fixtures, equipment and supplies
collectively referred to in Section 2.2 of this Agreement.
5. Management Expenses shall mean the operating and non- operating
expenses incurred in the operation of the Practice and the Dental Offices,
whether by UDC or the Practice, including, but not limited to: (i)
depreciation, amortization, salaries, benefits and other direct and
indirect costs of all employees of UDC providing services for the Practice
(but not including Practice Providers) ; (ii) obligations under leases or
subleases for the dental offices and equipment owned or leased by UDC and
used by the Practice; (iii) personal property and intangible taxes assessed
against assets used by the Practice; (iv) state and local business taxes,
fees and charges; (v) charitable contributions budgeted and approved by UDC
and the Practice; (vi) interest expense on indebtedness; (vii) utility
expenses relating to the Dental Offices; and (viii) insurance premium
expenses (other than those referred to in Section 1.8 below), recruitment
expenses, and other expenses incurred by UDC in carrying out its
obligations under this Agreement; and (ix) expenses associated with
business, legal and financial management consultation and advice reasonably
required or requested by the Practice and directly related to the
operations of the Practice.
6. Management Services shall mean the management services, personnel,
equipment and supplies provided for in Article III of this Agreement.
7. Dental Offices shall mean the dental offices identified on Exhibit
1.6 attached hereto, or at such other place or places as may be agreed upon
by the parties.
8. Practice Expenses shall mean all expenses of the Practice which are
not Management Expenses, including but not limited to: (i) any federal,
state or local income taxes of the Practice or UDC or the costs of
preparing federal, state or local tax returns; (ii) any and all salaries
and benefits, workers' compensation insurance, retirement plan
contributions, health, disability and life insurance premiums, payroll
taxes or cellular phone and automobile expenses incurred by or in
connection with the Practice Providers; (iii) Practice Provider licensure
fees, and costs of membership in professional associations; (iv) costs of
continuing professional education for Practice Providers; (v) costs
associated with legal, accounting and professional services incurred by or
on behalf of the Practice other than those referred to in Section; (vi)
insurance premium expenses for policies of professional liability or
malpractice insurance, deductibles under such policies of professional or
malpractice liability insurance, any and all costs and expenses incurred
with respect to claims under such policies of professional liability or
malpractice insurance and professional liability
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or malpractice liability judgments assessed against the Practice or
Practice Providers in excess of policy limits or within the deductible
limit of any policy of insurance; (vii) direct personal expenses of
Practice Providers of a kind which the Practice has historically charged to
its Practice Providers (including, but not limited to, costs of employees
providing personal services to particular Practice Providers and like
expenses personal in nature); (viii) any other expenses which are expressly
designated herein as expenses or responsibilities of Practice.; and, (ix)
UDC compensation as provided in Section 4.
9. Practice Providers shall mean individuals who are duly licensed to
practice dentistry in the State of Florida and those categories of
individuals who provide services incident to a dentist's services listed on
Exhibit 1.9 and who are employed by or shareholders in the Practice,
including other individuals who are employees of the Practice or otherwise
under contract with the Practice to provide dental services to patients of
the Practice (including, but not limited to, dentists, dental hygienists,
dental assistants, and any other individuals required by contract, law or
regulatory authority to be employees of the Practice for purposes of
obtaining payment or reimbursement or otherwise for services rendered by
the Practice. A list of all Practice Providers and their relationship to
the Practice is set forth as Exhibit 1.9 attached hereto. The Practice
shall use its best efforts to consult with UDC with regard to the terms and
conditions of contracts or other arrangements entered into between the
Practice and Practice Providers.
10. Practice Revenues shall mean all revenues collected by or on
behalf of the Practice or the Practice Providers as a result of
professional dental services furnished to patients, ancillary services
provided to patients, pharmaceuticals and other items and supplies sold to
patients and other fees or income generated by the Practice or Practice
Providers.
11.Proprietary Information shall mean the items described in the first
sentence of Article XII of this Agreement.
2. Obligations of UDC
1. Provision of Management Services. UDC shall provide to the Practice
the management services, personnel, equipment and supplies provided for in
this Article 2 at the Dental Offices. UDC shall adhere to commercially
reasonable business practice in the performance of its duties hereunder.
2. Furniture.Fixtures, Equipment and Supplies. UDC agrees to provide
to the Practice those supplies and items of furniture, fixtures and
equipment as are determined by UDC , after consultation with the Practice,
to be necessary and/or appropriate for the Practice's operations, and as
are contemplated by the Business Plan and Budgets, initially including
those items identified on Exhibit 2.2 attached hereto; subject, however to
the following conditions:
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1.The Practice shall have the use of the FFES only during
the term of this Agreement and title to the FFES shall be and
remain in UDC at all times during such term.
2.UDC shall be responsible for all repairs, maintenance and
replacement of the FFES, except for repairs, maintenance and
replacement necessitated by willful misconduct of the Practice,
its employees or agents.
3.THE PRACTICE ACKNOWLEDGES THAT UDC MAKES NO WARRANTIES OR
REPRESENTATIONS, EXPRESS OR IMPLIED, AS TO THE FITNESS,
SUITABILITY OR ADEQUACY OF ANY FURNITURE, FIXTURES, EQUIPMENT,
INVENTORY, OR SUPPLIES LEASED OR PROVIDED PURSUANT TO THIS
AGREEMENT FOR THE CONDUCT OF A DENTAL PRACTICE OR FOR ANY OTHER
PARTICULAR PURPOSE.
4.Nothing in this Agreement shall be construed to affect or
limit in any way the professional discretion of the Practice to
select and use equipment, furnishings, inventory, and supplies
purchased by UDC in accordance with the terms of this Agreement
insofar as such selection or use constitutes or might constitute
the practice of dentistry.
0.Xxxxxxxxx Planning and Goals. UDC will prepare, in consultation with
the Practice, an annual business plan and annual capital and operating
budgets for the Practice, reflecting in reasonable detail anticipated
revenues and expenses and sources and uses of capital for the Practice,
anticipated personnel staffing and support services arrangements,
anticipated ancillary services and the like.
0.Xxxxxxxx Office Services. The Practice hereby appoints UDC as its
sole and exclusive manager and administrator of all business functions and
services related to the Practice's services during the term of this
Agreement. UDC is hereby expressly authorized to perform its business
office services hereunder in whatever manner it deems appropriate to meet
the day-today requirements of the non-dental business functions of the
Practice's dental practice at the Dental Offices and is consistent with the
Business Plans and Budgets; provided, however, that all such services shall
be provided in a commercially reasonable manner. UDC may perform some or
all of the business office functions of the Practice at a location other
than at the Dental Offices. Without limiting the generality of the
foregoing, in providing the Management Services, UDC shall perform the
following functions:
5.Contracts.UDC shall evaluate, negotiate, and administer all dental
insurance and managed-care contacts and other third party payor contracts
on behalf of the Practice and shall consult with the Practice on all
professional or clinical matters relating thereto.
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6.Assessment Services.UDC shall provide ongoing assessment of business
activity including product line analysis, outcomes monitoring and patient
satisfaction.
7.Supplies.UDC shall be responsible for the ordering and purchasing of
all dental and office supplies required in the day-today operation of the
Practice at the Dental Offices and contemplated by the Business Plans and
Budgets.
8.Billing.UDC shall xxxx for and, to the extent are not assigned
pursuant to this Agreement, collect all Practice Revenues to the extent
permitted by law and the applicable payor. In seeking such payment, UDC
shall act as Practice's agent in billing and collecting all Practice
Revenues and shall only xxxx under the Practice's provider number. In this
regard, the Practice hereby appoints UDC for the term of this Agreement as
its true and lawful attorney-in- fact for the following purposes with
respect to any Practice, Revenues which are not otherwise assigned to UDC
pursuant to this Agreement:
0.Xx xxxx patients in the Practice's name and on the Practice's
behalf, and in the name and on behalf of all Practice Providers;
0.Xx collect accounts receivable in the name of and on behalf of
the Practice and all Practice Providers, including, where deemed
appropriate by UDC , settling and compromising claims, and, where
deemed appropriate by UDC , assigning such accounts receivable to a
collection agency or the bringing of a legal action against a patient
or payor on Practice's behalf;
3. To receive, in the name of and on behalf of the Practice and
all Practice Providers, all cash, notes, checks, money orders, payor
payments, and any other instruments received on behalf of Practice or
the Practice Providers as payments from patients, Blue Shield,
insurance companies, Medicare, Medicaid and all other payors, and UDC
hereby covenants to deposit such payments in the Bank Account;
0.Xx take possession of and endorse, in the name of and on behalf
of the Practice and all Practice Providers, any cash, notes, checks,
money orders, payor payments and any other instruments received as
payment of such accounts receivable; and
0.Xx collect in the name of and on behalf of the Practice and all
Practice Providers, all Practice Revenues.
6.Notwithstanding anything herein to the contrary, the payment
disposition instructions as they relate to billing and collecting for
services covered in whole or part by Medicare and Medicaid and the use
of the Bank Account may be modified at any time by the Practice as
required
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by Medicare and Medicaid rules and manual provisions governing
reassignment to a billing agent.
0.Xxxx Account: Deposit of Practice Revenues. During the term of this
Agreement, all Practice Revenues collected shall be deposited directly into
a bank account at the Bank. UDC shall maintain its accounting records in
such a way as to clearly segregate Practice Revenues from other funds of
UDC. The Practice hereby appoints UDC as its true and lawful
attorney-in-fact to deposit in the Bank Account all Practice Revenues
collected. The Practice and UDC hereby agree to execute from time to time
such documents and instructions as shall be required by the Bank to
effectuate the provisions of this Agreement and to extend or amend such
documents and instructions during any extended term to this Agreement.
10.Revenue Reports. UDC shall maintain revenue reports, as determined
by the books and records of UDC, with respect to the Practice. Revenue
reports shall reflect the total Practice Revenues generated by or on behalf
of the Practice. UDC shall cooperate with Practice's tax advisors to
provide year-end reports within a sufficient time frame, as may be
subsequently agreed by the parties, to complete year end tax planning. UDC
will cooperate with Practice to achieve tax results. UDC shall provide the
Practice with monthly revenue reports and shall provide a year-end revenue
report for the Practice within ninety (90) days after the end of the
calendar year.
00.Xxxxxxx Services. UDC shall provide all reasonable and necessary
computer, bookkeeping, billing and collection services, accounts receivable
and accounts payable management services, laundry, linen, janitorial and
cleaning services and management services to improve efficiency and
workflow systems and procedures, as determined by UDC after consultation
with the Practice.
12.Practice Manager. UDC shall provide a practice manager selected by
UDC, and approved by the Steering Committee to manage and administer all of
the day-to-day business functions and services of the Practice. UDC shall
determine the salary and fringe benefits of the, practice manager
consistent with the Business Plans and Budgets.
13.Personnel. UDC shall provide such non-dentist personnel are as
determined by UDC , after consultation with the Practice, to be reasonably
necessary for the effective operation of the Practice at the Dental offices
and are contemplated by the Business Plans and Budgets, subject, however,
to the following:
1.UDC shall provide to the Practice such dental records personnel
and other dental support personnel as are requested by the Practice,
deemed by UDC to be necessary for efficiency and contemplated by the
Business Plans and Budgets. UDC shall determine the salary and
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fringe benefits of such personnel consistent with the Business Plan
and Budgets. UDC shall also recommend the assignment of all such
personnel to perform services at the Dental offices; provided,
however, that the Practice shall have the right to approve, based
solely on professional competence, the assignment of all non-physician
dental support personnel to provide services at the Dental Offices and
UDC shall, at the Practice's request, reassign and replace such
personnel from time to time who are not, in the Practice's judgment,
adequately performing the required professional services.
2.UDC shall provide to the Practice such business office
personnel (whether through consolidated services or otherwise), i.e.,
such clerical, secretarial, bookkeeping and collection personnel, as
are deemed by UDC to be necessary for the maintenance of patient
records, collection of accounts receivable and upkeep of the financial
books of account to the extent that same are required for, and
directly related to, the operation of the Practice and are
contemplated by the Business Plans and Budgets. UDC shall determine
the salaries and fringe benefits of all such personnel provided under
this section.
0.Xx exercising its judgment with regard to personnel as provided
herein, the Practice agrees not to discriminate against such personnel
on the basis of race, religion, age, sex, disability or national
origin.
0.Xx recognition of the fact that personnel provided to the
Practice under this Agreement (including the practice manager referred
to in Section 2.12) may perform services from time to time for others,
this Agreement shall not prevent UDC from performing such services for
others or restrict UDC from so using such personnel. UDC will make
every effort consistent with sound business practices to honor the
specific requests of the Practice with regard to the assignment of
such personnel; provided, however, that except for non-dentist dental
support personnel, UDC hereby retains the sole and exclusive
decision-making authority regarding all such personnel assignments.
0.Xx the event that the Practice requests secretarial, clerical,
bookkeeping, management and non-physician dental support personnel in
addition to personnel determined to be necessary and/or appropriate by
UDC and/or contemplated by the Business Plans or Budgets, and such
personnel and/or services are provided by mutual agreement between UDC
and the Practice, all costs and expenses, incurred by UDC in providing
such additional personnel shall be paid to UDC by the Practice.
14.Facilities Utilities and Other Practice Expenses. UDC shall lease
or sublease the Dental Offices. UDC shall provide, manage and maintain
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the Dental Offices in good condition and repair, including the provision of
routine maintenance, reasonable wear and tear excepted, during the term of
this Agreement. UDC shall lease or sublease such additional offices and
facilities as the Practice and UDC agree, from time to time. UDC shall also
provide the Practice with all utilities (including water, gas, and
electricity), heat, air conditioning, telephone, janitorial services, and
disposal services (including disposal of all dental wastes) required in
connection with the Dental Offices and the operation of the Practice,
including, but not limited to, related lease costs, taxes and
property/casualty insurance and all costs of repairs, maintenance and
improvements.
15.Practice Professional Services. UDC shall arrange for or render to
the Practice such business, legal and financial management consultation and
advice as may be reasonably required or requested by the Practice and
directly related to the operations of the Practice.
16.Establishment of Fees. UDC shall propose, for approval by the
Practice, the fees, charges, premiums or other amounts due in connection
with all services and pharmaceutical and other items provided in connection
with the Practice.
17.Patient and Financial Records. UDC shall maintain all files and
records relating to the operation of the Practice, including, but not
limited to, customary financial records and patient files. Notwithstanding
the foregoing, the Practice shall supervise the preparation and direct the
contents of patient dental records. All such patient dental records shall
be and shall remain the property of Practice and the contents thereof shall
be solely the responsibility of Practice. UDC shall have reasonable access
to such records and, subject to applicable laws and regulations as
necessary to perform his duties under this Agreement.
18.Use of Names. At the option of UDC , the name of UDC or its
affiliates may be included on any letterhead, professional announcements,
brochures, promotional materials or the like relating to the Practice
and/or the name of the Practice and the Practice Providers may be included
in any brochures, promotional materials or the like relating to UDC .
19.Force Majeure. Neither party shall be liable to the other for
failure to perform any of the services, duties or obligations required of
such party herein in the event of strikes, lockouts, calamities, acts of
God, unavailability of supplies or other events over which such party has
no control for so long as such event continues and for a reasonable period
of time thereafter; provided, however, that each party agrees to use
reasonably diligent efforts to perform such services, duties and
obligations required of such party herein notwithstanding such events and
shall be liable to the other for the failure to use such reasonable
diligent efforts.
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20.Payment of Practice Expenses. UDC shall pay all Practice Expenses
as they fall due from the Practice Revenues; provided, however, that UDC
may, in the name and on behalf of the Practice and the Practice Providers,
contest in good faith any claimed Practice Expense to which there is any
dispute regarding the nature, existence or validity of the claimed Practice
Expense. UDC agrees to indemnify and hold the Practice and the Practice
Providers harmless from and against any liability, loss, damages, claims,
causes of actions or reasonable expenses of the Practice or the Practice
Providers resulting from the contest of any Practice Expense.
3.Obligations of the Practice
1.Professional Standards. It is expressly acknowledged by the parties
to the Agreement that all dental services provided at the Dental Offices
shall be performed solely by dentists duly licensed to practice dentistry
in the State of Florida.
2.Professional Dues and Education Expenses. The Practice and its
Practice Providers shall be solely responsible for all costs and expenses
associates with membership in professional associations and continuing
professional education. The Practice shall ensure that each of its Practice
Providers participates in such continuing dental education activities as
are necessary for such Practice Providers to remain current under
applicable laws, rules and regulations pertaining to the practice of
dentistry.
4.Compensation
0.Xxxxxxxxxx Fee. The Practice shall compensate UDC for the services
provided by UDC in this Agreement in a monthly amount equal to One Hundred
and 00/100 ($100.00) Dollars per month to be paid from the Practice
Revenues, plus UDC shall retain the excess of the Practice Revenue over the
Practice Expenses. With respect to any partial calendar month during which
this Agreement is in effect, the compensation due UDC shall be prorated
according to the number of calendar days actually elapsed during such
partial calendar month.
2.Payment Due Date. On or before the fifteenth (15th) or last day of
each calendar month during the term of this Agreement and on or before the
earlier of the fifteenth (15th) or last day of the calendar month following
the expiration or earlier termination of this Agreement, all amounts owed
by Practice since the preceding payment to UDC in accordance with Section
4.1 of this Agreement shall be due and payable to UDC. UDC is hereby
irrevocably authorized to withdraw all such amounts or any other amounts
owed to UDC under this Agreement from the Bank Account without any further
notice to or authorization from the Practice or any of the Practice
Providers. If, in any time
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period, there are insufficient funds in Bank Account to pay any amounts
owed to UDC under this Agreement, such amounts may accrue and shall be paid
from the next collected Practice Revenues prior to the payment of any
future amount(s) owed by UDC under this Agreement. In any event, the
Practice shall remain liable to pay such amounts to UDC in accordance with
the provisions of this Agreement.
3.Basis of Compensation. The parties acknowledge and agree that the
compensation set forth herein represents the fair market value of the
services and supplies provided by UDC to the Practice negotiated in an
arm's- length transaction and has not been determined in a manner which
takes into account the volume or value of any referrals or business
otherwise generated between UDC and the Practice or any UDC affiliate and
the Practice.
5.Term and Termination
1.Term. The initial term of this Agreement shall be for a period of
ten (10) years commencing on the date of this Agreement (the "Commencement
Date") and continuing until the tenth (10th) anniversary of the
Commencement Date (the "Initial Term"). This Agreement may be extended for
separate and successive five (5) year periods (each such five (5) year
period referred to hereinafter as an "Extended Term"), under such terms and
conditions as stated herein with respect to any such Extended Term,
provided that the Practice and UDC mutually agree to extend the term hereof
and mutually agree upon the documents to be in effect during any such
Extended Term hereto, not less than sixty (60) days prior to expiration of
the Initial Term or Extended Term then in effect and the Practice is not in
material default hereunder on the date of commencement of the Extended
Term.
2.Termination.
1.Termination by UDC. UDC may terminate this Agreement, and have
no further liability or obligation hereunder, upon the occurrence of
one or more of the following events:
1.The Practice fails to pay any portion of the sums due UDC
under this Agreement when due and such failure continues uncured
for a period of ten (10) days after the Practice's receipt of
written notice specifying such failure.
2.The Practice ceases to substantially perform or cause to
be performed its duties and responsibilities hereunder or
breaches any material term or condition of this Agreement, and
such cessation or breach continues uncured for a period of thirty
(30) days after UDC 's receipt of written notice specifying such
breach; provided, however, that if the breach is of a type that
cannot be cured within such thirty (30) day period, UDC shall
have
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such longer period of time as may be reasonably necessary
provided UDC commences the cure within such thirty (30) day
period and thereafter prosecutes such cure diligently to
completion.
3.The Practice voluntarily files a petition in bankruptcy or
makes an assignment for the benefit of creditors or otherwise
seeks relief from creditors under any federal or state
bankruptcy, insolvency, reorganization or moratorium statute, or
the Practice is the subject of an involuntary petition in
bankruptcy which is not set aside within sixty (60) days of its
filing.
4.Any representations and warranties made by the Practice in
this Agreement prove to be untrue or incorrect as of the date of
this Agreement or any representations or warranties of a
continuing nature made by the Practice in this Agreement cease to
be true and correct at any future date.
2.Termination by Practice.The Practice may terminate this
Agreement, and have no further liability hereunder, upon the
occurrence of one or more of the following events:
1.UDC fails to pay any portion of the sums due the Practice
under this Agreement when due and such failure continues uncured
for a period of ten (10) days after UDC's receipt of written
notice specifying such failure.
2.UDC ceases to substantially perform or cause to be
performed its duties and responsibilities hereunder or breaches
any material term or condition of this Agreement, and such
cessation or breach continues uncured for a period of thirty (30)
days after UDC 's receipt of written notice specifying such
breach; provided, however, that if the breach is of a type that
cannot be cured within such thirty (30) day period, UDC shall
have such longer period of time as may be reasonably necessary
provided UDC commences the cure within such thirty (30) day
period and thereafter prosecutes such cure diligently to
completion.
3.UDC voluntarily files a petition in bankruptcy or makes an
assignment for the benefit of creditors or otherwise seeks relief
from creditors under federal or state bankruptcy, insolvency,
reorganization or moratorium statute, or UDC is the subject of an
involuntary petition in bankruptcy which is not set aside within
sixty (60) days of its filing.
3.Remedies Upon Termination. Upon the expiration or termination of
this Agreement:
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1.Neither party shall be released or discharged from any
obligation, debt or liability which has previously accrued or
been incurred and remains to be performed upon the date of
termination or expiration;
2.Any sums of money owing by one party to the other shall be
paid immediately, prorated through the effective date of such
termination or expiration; including without limitation, any
amounts owed by the Practice pursuant to this Section 5 herein;
3.The Practice shall return to UDC all originals and copies
of the Proprietary Information as defined in Article 12 which are
in the possession of the Practice or any other person or entity
to whom it has delivered such originals and copies; and
4.If this Agreement is terminated pursuant to Sections 5.2.1
or 5.2.2 hereof, the non-breaching party may pursue such other
legal or equitable relief as may be available.
4.Winding up of Affairs. Upon the expiration or termination of
this Agreement, the Practice and UDC shall, in addition to the duties
and obligations elsewhere provided in this Agreement, perform such
matters as are necessary to wind up their activities under this
Agreement in an orderly manner. These activities shall include
provision to the Practice of patient billing records on paper or
electronic data (in the discretion of the Practice).
6.Representations and Warranties of the Practice. The Practice hereby
represents and warrants to UDC as follows:
1.Organization and Good Standing. The Practice is a professional
association duly organized, validly existing and in good standing
under the laws of the State of Florida. The Practice has all necessary
power to own all of its properties and assets and to carry on its
business as now being conducted.
0.Xx Violations. The Practice has the corporate authority to
execute, deliver and perform this Agreement and all agreements
executed and delivered by it pursuant to this Agreement, and has taken
all action required by law, its Articles or Certificate of
Incorporation, its Bylaws or otherwise to authorize the execution,
delivery and performance of this Agreement and such related documents.
The execution and delivery of this Agreement does not and, subject to
the consummation of the transactions contemplated hereby, will not,
violate any provisions of the Articles or Certificate of Incorporation
or Bylaws of the Practice or any agreement, instrument, order,
arbitration award, judgment or decree, to which the Practice is a
party, or by which it is bound. This Agreement has been duly executed
and delivered by the Practice and constitutes the legal, valid and
binding obligation of the Practice, enforceable in accordance with its
terms.
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6.3Financial Information. The Practice has hereto furnished UDC
with complete copies of certain financial information about the
Practice which information is true and correct and presents fairly the
financial results experienced by the Practice for the periods set
forth in such information.
6.4 Professional Liability. No Practice Provider has ever (a) had
his/her license to practice medicine in any state or his/her Drug
Enforcement Agency number suspended, relinquished, terminated,
restricted or revoked; (b) been reprimanded, sanctioned or disciplined
by any licensing board, or any federal, state or local society or
agency, governmental body or specialty board; (c) had entered against
him/her final judgment in, or settled without judgment, a malpractice
or similar action for an aggregate award or amount to the plaintiff in
excess of $25,000; or (d) had his/her dental staff privileges at any
hospital or dental facility suspended, terminated, restricted or
revoked.
7. Representations and Warranties of UDC . UDC hereby represents and
warrants to the Practice as follows:
7.1. Organization in Good Standing. UDC is a corporation duly
organized, validly existing and in good standing under the laws of the
State of Florida. UDC has all necessary power to own all of its
properties and assets and to carry on its business as now being
conducted.
7.2. No Violations. UDC has the corporate authority to execute,
deliver and perform this Agreement and all agreements executed and
delivered by it pursuant to this Agreement, and has taken all action
required by its Articles of Incorporation, its Bylaws or otherwise to
authorize the execution, delivery and performance of this Agreement
and such related documents. The execution and delivery of this
Agreement does not and, subject to the consummation of the
transactions contemplated hereby, will not, violate any provisions of
the Articles of Incorporation or Bylaws of UDC or any agreement,
instrument, order, arbitration award, judgment or decree, to which UDC
is a party, or by which it is bound, which would adversely affect the
ability of UDC to perform its obligations hereunder. This Agreement
has been duly executed and delivered by UDC and constitutes the legal,
valid and binding obligation of UDC, enforceable in accordance with
its terms.
8. Insurance to be Maintained by the Practice. The Practice shall
provide, or arrange for the provision of, and maintain throughout the
entire term of this Agreement, for the Practice, each Practice Provider and
each of the Practice's other employees and agents, professional
liability/malpractice insurance coverage in the minimum amount of
$250,000.00 per occurrence and $750,000.00 annual aggregate and workers,
compensation insurance coverage in the minimum amounts required by
applicable law. The Practice shall, at its sole cost and expense, pay the
premium costs of all such insurance coverage during the term of this
Agreement and, upon request by UDC, provide UDC with evidence of such
coverage.
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8.1. Indemnification by UDC. UDC hereby agrees to indemnify, hold
harmless and defend the Practice from and against any and all
liability, loss, damages, claims, caused or asserted to have been
caused, directly or indirectly, by or as a result of the negligent
performance of Management Services by UDC , its employees or agents
during the term hereof. Under this provision, UDC shall have the right
to defend any claim, cause of action, liability or obligation (actual
or alleged) and control the defense and settlement thereof. The
Practice agrees to cooperate fully as necessary in the defense of such
matters. The provisions of this Section 8.1 shall survive the
expiration or earlier termination of this Agreement.
8.2 Indemnification by the Practice. The Practice hereby agrees
to indemnify, hold harmless and defend UDC from and against any and
all liability, loss, damages, claims, causes of action and expenses
associated therewith (including reasonable attorneys fees) caused or
asserted to have been caused, directly or indirectly, by or as a
result of the performance of services or provision of goods by the
Practice, the Practice Providers and the Practice's employees or
agents during the term hereof. Under this provision, the Practice
shall have the right to defend any claim, cause of action, liability
or obligation (actual or alleged) and control the defense and
settlement thereof. UDC agrees to cooperate fully as necessary in the
defense of such matters. The provisions of this Section 8.2 shall
survive the expiration or earlier termination of this Agreement.
9.Assignment. The parties hereby agree that this Agreement shall not
be assigned or transferred by either party without the prior written
consent of the other; provided, however, that this Agreement may be
assigned, in whole or in part, by UDC, in its sole discretion, in
connection with the sale of substantially all of the assets of UDC with the
consent of the Practice, which may not be unreasonably withheld.
10.Independent Contractor Status. The Practice and UDC are at all
times acting and performing hereunder as independent contractors. UDC shall
neither have nor exercise any control or direction over the methods by
which the Practice or the Practice Providers practice medicine. The sole
function of UDC hereunder is to provide all Management Services in a
competent, efficient and satisfactory manner. UDC shall not, by entering
into and performing its obligations under this Agreement, become liable for
any of the obligations, liabilities, debts or losses of the Practice unless
otherwise specifically provided for under the terms of this Agreement. UDC
will, in its management role, have only an obligation to exercise
reasonable care in the performance of the Management Services. UDC shall
have no liability whatsoever for damages suffered on account of the willful
misconduct or negligence of any employee, agent or independent contractor
(other than UDC) of the Practice. Each party shall be solely responsible
for compliance with all state and federal laws pertaining to employment
taxes, income withholding, unemployment compensation contributions and
other employment related statutes regarding their respective employees,
agents and servants. In the event that any court or regulatory authority
shall determine that the relationship established hereby creates an
employment relationship (or in the event that UDC, in good faith,
determines that there is a material risk that such a determination
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would be made by any court or regulatory authority), the parties will
negotiate in good faith to modify the Agreement, in order to maintain the
independent contractor arrangement, or if not possible enter into an
employment arrangement between UDC and the then current Practice Providers,
which modification or employment substantially preserves for the parties
the relative economic benefits of this Agreement. If the parties cannot
reach agreement on such a modification or employment arrangement, then UDC
may terminate this Agreement upon thirty (30) days prior written notice to
the Practice.
11. Practice of Dentistry. The parties hereto acknowledge that UDC is
not authorized or qualified to engage in any activity which may be
construed or deemed to constitute the practice of dentistry and that
nothing herein shall be construed as the practice of dentistry by UDC. To
the extent any act or service required to UDC is construed or deemed to
constitute the practice of dentistry, UDC is released from any obligation
to provide such act or service without otherwise affecting the terms of
this Agreement.
12.Confidential Information. At no time during the term of this
Agreement or after the date that this Agreement shall terminate or expire
shall the Practice, its Practice Providers, or any of its or agents
disclose to anyone any confidential or secret information concerning (a)
the business, affairs or operation, (b) any trade secrets, new product
developments, special or unique processes or methods, or (c) any marketing,
sales, advertising or other concepts or plans, of UDC or any of its
parents, subsidiaries or affiliates. All officers, directors, employees,
and agents of the Practice who will have access to all or any part of such
Proprietary Information may be required to execute an agreement, at the
reasonable request of UDC, and in a form acceptable to UDC and its counsel,
committing themselves to maintain the Proprietary Information in strict
confidence and not to disclose it to any unauthorized person or entity. The
Practice hereby acknowledges that in the event that it or any of its
shareholders, partners, employees or agents engage in activities within the
limitations of this Article 12, money damages shall be an inadequate
remedy, and the Practice agrees that UDC shall be entitled to obtain, in
addition to any other remedy provided by law or equity, an injunction
against the violation of the Practice's obligations to UDC hereunder.
13.Miscellaneous
13.1 Notices. Any notice required or permitted by this Agreement
or any agreement or document executed and delivered in connection with
this Agreement shall be deemed to have been served properly if hand
delivered or sent by overnight express, charges prepaid and properly
addressed, to the respective party to whom such notice relates at the
following addresses:
If to the Practice: Xxxxxx X. Xxxxx, D.D.S., P.A.
0000 Xxxxxxxxxx Xx., Xxxxx 000
Xxxxx Xxxxxxx, XX 00000
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with a copy to: Xxxxxx X. Xxxxxxxx, Esquire
XXXXX, XXXXXXXX & BLACK, P.L.
0000 X.X. 0xx Xxxxx
Xxxxxxxxxx, Xxxxxxx 00000
If to UDC: Union Dental Corp.
0000 Xxxxxxxxxx Xx., Xxxxx 000
Xxxxx Xxxxxxx, XX 00000
or such other addresses shall be furnished in writing by any party to
the other party. All such notices shall be considered received when
hand delivered or one business day after delivery to the overnight
courier.
13.2. Additional Acts. Each party hereby agrees to perform any
further acts and to execute and deliver any documents which may be
reasonably necessary to carry out the provisions of this Agreement.
13.3. Governing Law. This Agreement shall be interpreted,
construed and enforced in accordance with the laws of the State of
Florida, applied without giving effect to any conflicts of law
principles.
13.4. Captions. The captions or headings in the Agreement are
made for convenience and general reference only and shall not be
construed to describe, define or limit the scope or intent of the
provisions of this Agreement.
13.5. Severability. In the event that any provision or part of
any provision of this Agreement shall be determined by a court of
competent jurisdiction to be invalid or unenforceable, such
determination shall not affect the remaining parts or provisions of
this Agreement which shall continue in full force and effect.
13.6. Contract Modification for Prospective Legal Events. In the
event any state or federal laws or regulations, now existing or
enacted or promulgated after the date of this Agreement, are
interpreted by judicial decision, a regulatory agency, or legal
counsel of both parties in such a manner as to indicate that the
structure of this Agreement may be in violation of such laws or
regulations, the Practice and UDC shall amend this Agreement to the
maximum extent possible to preserve the underlying economic and
financial arrangements between the Practice and UDC. If an amendment
is not possible, either party shall have the right to terminate this
Agreement.
13.7. Modifications. This instrument contains the entire
agreement of the parties and supersedes any and all prior or
contemporaneous negotiations, understandings or agreements between the
parties, written or oral, with respect to the transactions
contemplated hereby. This Agreement may only be modified by an
agreement in writing signed by the parties hereto.
13.8. Counterparts. This Agreement may be executed in several
counterparts, each of which, when so executed, shall be deemed to be
an original, and such counterparts shall, together, constitute and be
one and the same instrument.
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13.9. Binding Effect. This Agreement shall be binding on and
shall inure to the benefit of the parties hereto, and their successors
and permitted assigns. Subject to the foregoing sentence, no person
not a party hereto shall have any right under or by virtue of this
Agreement.
13.10. Costs of Enforcement. In the event that either party files
suit in any court against the other party to enforce the terms of this
Agreement against the other party or to obtain performance by it
hereunder, the prevailing party will be entitled to recover all
reasonable costs, including reasonable attorneys' fees, from the other
party as part of any judgment in such suit. The term "prevailing
party" shall mean the party in whose favor final judgment after appeal
(if any) is rendered with respect to the claims asserted in the
complaint. "Reasonable attorneys' fees" are those attorneys' fees
actually incurred in obtaining a judgment in favor of the prevailing
party.
IN WITNESS WHEREOF, the parties have duly executed this Agreement on the
day and year first above written.
Xxxxxx X. Xxxxx, DDS, P.A.
By:/s/ Xxxxxx X. Xxxxx
----------------------
Union Dental Corp.
By:/s/ Xxxxxx X. Xxxxx
----------------------
Its: CEO and President
----------------------
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