SOFTWARE LICENSE AND SERVICES AGREEMENT
This SOFTWARE LICENSE AND SERVICES AGREEMENT (this "Agreement") is
entered into this 1st day of September, 1999 (the "Effective Date"), between
University Affiliates IPA, Inc., a California nonprofit mutual benefit
corporation ("IPA"), and x-XxxXxxx.xxx., a Nevada corporation ("E-Med").
Pursuant to the terms and conditions of this Agreement, E-Med licenses
certain software to IPA, provides to IPA the right to sublicense such
software, and agrees to provide related services to IPA and DHCPs, and it is
the intention of the parties that IPA will utilize such software.
1. Definitions.
1.1. "Accepts" and "Acceptance" means the written certification by
IPA that an item of software performs in a manner satisfactory for use by the
IPA Members. There shall be no default Acceptance, and none other than by
this affirmative written certification.
1.2. "Asset Purchase Agreement" means that agreement dated of even
date herewith by and between Sanga e-Health, LLC, a California limited
liability company, IPA, and E-Med, pursuant to which E-Med purchased SamSyn
from IPA.
1.3. "Default" shall have the meaning set forth in Section 12.1
hereof.
1.4. "Designated Health Care Professionals" shall have the meaning
set forth in Section 5.1 hereof.
1.5. "DHCPs" shall mean Designated Health Care Professionals.
1.6. "E-Med" shall have the meaning set forth in the preamble
hereto.
1.7. "E-Med Software" means SamSyn, NS and the Other E-Med Software.
1.8. "E-Med Software List" shall have the meaning set forth in
Section 6.1 hereof.
1.9. "Go Live" means, with respect to each item of E-Med Software,
the point in time at which there is fully functioning data exchange with
respect to such software on the computer systems of IPA or DHCPs, as the case
may be.
1.10. "Including" means including without limitation.
1.11. "Indemnifying Party" shall have the meaning set forth in
Section 10.3 hereof.
1.12. "Indemnified Party" shall have the meaning set forth in
Section 10.3 hereof.
1.13. "IPA" shall have the meaning set forth in the preamble hereto.
1.14. "IPA Members" means DHCPs who have entered into agreements
with IPA such that they become participating providers of IPA and who use
SamSyn, NS or any Other E-Med Software.
1.15. "New Software" shall have the meaning set forth in Section 4.1
hereof.
1.16. "NS" means New Software.
1.17. "Other E-Med Software" means all software owned by E-Med, and
the Upgrades thereto from time to time, other than SamSyn and NS.
1.18. "Person" means any individual, corporation, company, limited
liability company, trust, governmental authority or other entity.
1.19. "Proprietary Information" shall have the meaning set forth in
Section 11.1 hereof.
1.20. "Project Manager" shall have the meaning set forth in Section
4.6 hereof.
1.21. "Right of First Refusal Notice" shall have the meaning set
forth in Section 5.3 hereof.
1.22. "SamSyn" means that certain clinical management computer
software system known and used by IPA as SamSyn, including object and source
code, as more particularly described in Section 4.1 hereof.
1.23. "SamSyn Agreement" means that certain SamSyn Agreement between
USC and IPA effective as of January 1, 1998 relating to the assignment of
SamSyn to IPA.
1.24. "Services" shall have the meaning set forth in Section 7.1
hereof.
1.25. "Termination Date" shall have the meaning set forth in Section
3.1 hereof.
1.26. "Term" means ten years from the Effective Date, except as set
forth in Section 5.5.
1.27. "Territory" means the California counties of Los Angeles,
Orange, Riverside, San Bernardino and Ventura.
1.28. "Third Party Non-Territory License" shall have the meaning set
forth in Section 5.3 hereof.
1.29. "Upgrades" means bug fixes, upgrades, new versions, updates,
enhancements, and added functionality without regard to the manner in which
such functionality is added to the software upgraded.
1.30. "Y2K" refers to the problem that some computer systems
currently have, or may or will have, with respect to the change of year from
1999 to 2000, including leap year and including the use of "99" as year data
as a function of which such systems are not able correctly to read, calculate,
or output using dates before, during, or after 1999.
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2. Representations and Warranties.
2.1. E-Med represents and warrants to IPA that:
2.1.1. It has full power and authority to enter into and
perform this Agreement and that such ability is not limited or restricted by
any agreements or understandings between E-Med and other Persons;
2.1.2. Immediately subsequent to the execution of the Asset
Purchase Agreement, E-Med will have all rights in E-Med Software and no Person
other than E-Med will have any ownership claim to the rights licensed,
assigned, or otherwise provided to IPA under this Agreement;
2.1.3. Any information or materials contained in or relating
to the Other E-Med Software are either original with E-Med, in the public
domain, or E-Med is licensed to dispose of them as contemplated by this
Agreement. Such materials, and their contemplated disposition under this
Agreement, do not and shall not infringe any Person's rights including without
limitation, patents, copyrights, including rights in a joint work, trademarks,
trade dress, rights of publicity, privacy, moral rights, literary rights,
performance, trade secret, libel and intellectual property rights including
rights under patent, copyright, and trademark law, or any other right;
2.1.4. All rights granted to IPA hereunder are free and clear
of all liens, claims and encumbrances, including such of any Person that
contributed in any way to Other E-Med Software;
2.1.5. There is no claim, action, suit or proceeding relating
to the rights of E-Med in and to the Other E-Med Software pending or
threatened before any court, examiner, board, tribunal, arbiter, or other
adjudicatory entity;
2.1.6. E-Med is solvent and has the financial resources to
complete and deliver the Services and E-Med Software;
2.1.7. E-Med has the technical expertise and resources to
fulfill its obligations under this Agreement;
2.1.8. The E-Med Software shall be of good and marketable
quality, be free from all defects in design, materials, workmanship,
performance and title; and the Other E-Med Software and the NS shall meet the
needs of the IPA Members;
2.1.9. The E-Med Software shall provide adequate security for
the protection of the Proprietary Information;
2.1.10. The E-Med Software shall not experience difficulties,
bugs, or other than correct performance, as a consequences of Y2K, or any
other feature of the software or its interaction with the hardware with which
it is reasonably expected to interact and does not contain any viruses or
other code that will delay or disrupt the use of the E-Med Software, destroy
or render less than fully useful any data manipulated by the E-Med Software;
2.1.11. The Services shall be provided in a workmanlike
manner, and will result in the E-Med Software, at all times during the Term,
complying with the provisions of Section 2.1.8; and
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2.1.12. The E-Med Software can, with currently commercially
available additional interface software, permit third parties to enter and
read data, such as in a web based environment.
2.2. IPA represents and warrants to E-Med that it has full power
and authority to enter into and perform this Agreement, and that such ability
is not limited or restricted by any agreements or understandings between IPA
and other Persons, other than as expressly set forth herein.
3. Term.
3.1. This Agreement will begin on the Effective Date and will
terminate on the date which is the tenth (10th) anniversary of the Effective
Date, unless earlier terminated by either party pursuant to the terms hereof
and except as otherwise provided in Section 5.5 (the "Termination Date"). The
parties may agree to extend the Term by executing an addendum in writing to
that effect not less than sixty (60) days prior to the expiration of the Term.
Neither the expiration nor earlier termination of this Agreement shall relieve
either party of any obligation it may owe to the other which may have accrued
as of the date of such termination.
4. Development of NS; Deployment; Related Costs.
4.1. E-Med will have sole responsibility for the development of new
software which utilizes E-Med technology and the current version of SamSyn
(the "New Software" or "NS"). The Workplan for such development is set forth
on Exhibit A. The parties acknowledge and agree that NS will be completely new
software, with different functionality than SamSyn, and is not an update,
upgrade, modification or enhancement of SamSyn. In this respect, the parties
acknowledge that SamSyn is a clinical management computer software system,
utilizing a Unix operating system and a Universe based database that uses
TOADS to perform all front end activity and that SamSyn performs scheduling,
billing and managed care activities requiring Termite as an emulator.
4.2. The NS will be an integrated office management system
performing all functions necessary for office management and providing access
to all patient, insurance and physician information based on user definitions
and will have the following features:
4.2.1. be web based;
4.2.2. be logic driven;
4.2.3. use Java, and Java Scripting as a language; and
4.2.4. use Oracle as a database.
4.3. The NS will enable IPA and DHCP's to engage in an online
submission and review of at least the following information:
4.3.1. eligibility;
4.3.2. referrals and authorizations;
4.3.3. submission and payment of claims;
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4.3.4. physician information; and
4.3.5. covered benefits.
4.4. E-Med shall enable NS to Go Live on IPA's computer systems no
later than December 31, 1999.
4.5. IPA will cooperate with E-Med and will provide the personnel
set forth in Exhibit B to assist in the development of NS by E-Med and to be
responsible for the deployment of NS by IPA. The persons set forth in Exhibit
B shall devote to the deployment of NS that percentage of their full time
indicated opposite their respective names on Exhibit B.
4.6. E-Med shall each be solely responsible for paying directly or
reimbursing IPA, within fifteen (15) days of a written request from IPA, for
all costs and expenses relating to the work to be performed by IPA personnel
in connection with E-Med's development of NS and IPA's deployment thereof,
including salaries, benefits and expenses of the persons listed in Exhibit B
based on the portion of their full time devoted to such development and/or
deployment as set forth in Exhibit B.
4.7. E-Med shall reimburse IPA, within fifteen (15) days of a
written request from IPA, for all installation, deployment, training,
marketing, sales and similar costs incurred by IPA or its employees in IPA's
effort to attain Acceptance of NS on IPA's computer systems and the computer
systems of DHCPs.
4.8. Both E-Med and IPA shall appoint a project manager (each a
"Project Manager") whose duties will include acting as the primary liaison
between the parties in connection with the development and deployment of NS.
The Project Managers shall, until the Acceptance of NS, meet on a periodic
basis as mutually agreed upon for the purpose of reporting on the progress of
the development effort and resolving any technical issues that may arise.
E-Med shall be responsible for all costs incurred by either party in attending
these meetings.
5. License Grants.
5.1. E-Med grants to IPA, for the Term, a worldwide license to use
SamSyn and to exclusively, to the exclusion of all other Persons including
E-Med, sublicense or otherwise permit the use of SamSyn to any IPA Member or
any other designated provider of health care services (collectively with IPA
Members, the "Designated Health Care Professionals" or "DHCPs") in exchange
for the payment by IPA to E-Med, from the Effective Date until the date of
Acceptance of NS by IPA, of $100,000 each calendar quarter, payable upon the
first day of each such quarter and prorated with respect to any partial
quarter. In the event that E-Med is in Default hereunder, IPA shall have the
right to use SamSyn, and sublicense or otherwise permit the use of SamSyn to
DHCPs, without any further payment of any fees to E-Med.
5.2. E-Med grants to IPA, for the Term, a worldwide license to use
NS and to exclusively, to the exclusion of all other Persons including E-Med
within the Territory, sublicense or otherwise permit the use of NS in the
Territory to DHCPs in exchange for the payment by IPA to E-Med monthly,
commencing upon the date of Acceptance of NS by IPA, of license fees equal to
the following:
For the managed care functions of NS, as described in part in
Section 4.3, the greater of:
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1.92% of the monthly gross revenues derived by IPA from
managed care payors in the form of capitation payments for professional
medical services in the Territory on a prospective basis, and for which IPA
bears financial risk with respect to the future provision of such DHCPs'
services; or
$45,000 unless IPA requires that the managed care
functions of NS be more extensive than those set forth in Section 4.3 (in
which event the parties shall agree to an increase in such amount).
For the billing and collection functions of NS, (i) 3.5%
of the monthly revenues collected by IPA on behalf of DHCPs in the Territory
who are IPA Members as a result of the billing and collection services
provided by IPA to such DHCPs, or, as the case may be, (ii) such percentage of
the monthly revenues collected by IPA on behalf of DHCPs in the Territory who
are not IPA Members as a result of the billing and collection services
provided by IPA to such DHCPs as shall be determined unanimously by the Board
of Directors of E-Med based on market factors.
5.3. Pursuant to the provisions of this Section 5.3, if at any time
after the Effective Date, E-Med shall propose to license NS to a third party
for the purpose of such third party sublicensing, or otherwise permitting the
use of, NS to entities outside of the Territory (a "Third Party Non-Territory
License"), E-Med shall adhere to the following procedures. Prior to its entry
into any Third Party Non-Territory License, E-Med shall notify IPA in writing
(the "Right of First Refusal Notice") of its intentions to enter into a Third
Party Non-Territory License, and, in such writing, E-Med shall set forth the
terms under which it proposes to enter into such Third Party Non-Territory
License. Within thirty (30) days after its receipt of the Right of First
Refusal Notice, IPA shall notify E-Med whether it seeks to exclusively license
NS on the same terms and conditions as those set forth in the Right of First
Refusal Notice. In the event that IPA declines to license NS on the terms and
conditions set forth in the Right of First Refusal Notice, or does not respond
to E-Med within thirty (30) days of its receipt of the Right of First Refusal
Notice, E-Med may enter into the Third Party Non-Territory License. If IPA
notifies E-Med that it will exclusively license NS on such terms and
conditions, the parties shall amend this Agreement or shall enter into a new
agreement on the terms and conditions set forth in the Right of First Refusal
Notice and/or such other terms and conditions on which the parties may agree.
5.4. E-Med grants to IPA, for the Term, a worldwide license to use
the Other E-Med Software and to exclusively, to the exclusion of all other
Persons including E-Med in the Territory, sublicense or otherwise permit the
use of the Other E-Med Software to DHCPs in exchange for the prompt payment by
IPA to E-Med, commencing upon the Acceptance of the Other E-Med Software by
IPA, of license fees equal to the lowest of (a) ninety percent (90%) of
E-Med's listed price available or intended to be available to third party
customers for any item of Other E-Med Software, (b) the lowest price paid to
E-Med for such other item of E-Med Software by any other customer of E-Med ,
or (c) such other price as may be agreed upon by the parties.
5.5. E-Med acknowledges that it has reviewed the SamSyn Agreement
and that, pursuant to the SamSyn Agreement, the University of Southern
California, a California nonprofit public benefit corporation, USC Care
Medical Group, Inc. and the faculty practice groups affiliated with the
University of Southern California (collectively, "USC") retain a perpetual,
royalty-free license to use and adopt SamSyn for their internal purposes and
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have the right to license or otherwise make SamSyn available to any third
party controlled by or under the control of USC. E-Med agrees that its
rights in SamSyn are subject to the rights of USC pursuant to the SamSyn
Agreement and that it will take no action with respect to SamSyn that would in
any way interfere with or be inconsistent with such rights of USC.
Accordingly, and as required by the SamSyn Agreement, any modifications,
updates or enhancements of SamSyn that may be delivered by USC shall not be
used by E-Med without the express written consent of USC. Notwithstanding the
provisions of Sections 1.26 or 3.1, with respect only to USC's use of SamSyn
pursuant to the terms of the SamSyn Agreement, the term of the license granted
under Section 5.1 of this Agreement shall be perpetual. As set forth in
Section 4, the parties acknowledge and agree that NS will be completely new
software, with different functionality than SamSyn, and will not be an update,
upgrade, modification or enhancement of SamSyn.
5.6. E-Med grants to IPA the right to (a) make copies of the E-Med
software for distribution to DHCPs, (b) make such copies of the E-Med Software
as are convenient for the purposes of backup or archiving, and (c) make such
copies of user manuals or documentation for internal distribution or
distribution to DHCPs as is otherwise convenient.
5.7. E-Med shall not permit any Person other than IPA to use,
sublicense or otherwise permit the use of the E-Med Software in the Territory.
6. Delivery of Software
6.1. Monthly Product Lists. E-Med shall provide IPA with a
comprehensive list of the E-Med Software owned by E-Med and the price list
relating thereto on a monthly basis (the "E-Med Software List"). The E-Med
Software List shall be provided to IPA no later than the fifth (5th) day of
every month.
6.2. Prompt Delivery After Order. Upon the order by IPA of any
E-Med Software, E-Med shall deliver such software to IPA no later than fifteen
(15) calendar days after E-Med's receipt of such order.
6.3. Acceptance. Subsequent to IPA's receipt of any E-Med Software,
including NS, IPA shall have ninety (90) days to Accept such software, and
upon such Acceptance, IPA's payment obligations with respect to the software
shall arise.
7. Services to be Provided.
7.1. E-Med shall provide to IPA, and shall provide to DHCPs, on
behalf of IPA, all installation, implementation, training, consulting or other
services required to (i) enable the E-Med Software to Go Live on the computer
and electronic systems of, as the case may be, IPA or DHCPs, and (ii) maintain
the E-Med Software in operation ((i) and (ii) to be collectively known as the
"Services"). E-Med shall provide the Services commencing on the installation
of any such E-Med Software. E-Med will only use Approved Employees in its
provision of the Services.
7.2. The Services shall include at least:
7.2.1. An "800" number help desk support, 6:00 a.m. to 9:00
p.m. Pacific time, on weekdays, holidays (such dates previously provided to
IPA in writing) excepted;
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7.2.2. 24 hour Beeper service for emergency calls.
7.2.3. Helpdesk support which extends to all specific
questions and problems, including interactions between hardware and software.
7.2.4. A range of services including answering simple "how to"
questions, to in-depth application and technical assistance, and shall include
assistance on (i) all software in use by IPA and DHCPs and (ii) communications
between the E-Med Software and third party systems.
7.2.5. An average response time to support calls during the
week (normal support hours) of less than one hour of the call, and within an
average of two hours at all other times.
8. Upgrades. E-Med shall provide to IPA:
8.1. All Upgrades pertaining to any E-Med Software licensed by IPA.
Such Upgrades shall be provided to IPA prior to being provided to any other
customer of E-Med.
8.2. All manuals and documentation pertaining to such Upgrades;
8.3. All support and/or Services necessary for the use of such
Upgrades; and
8.4. Any training on Upgrades that E-Med provides to any other
client.
9. Ownership of Inventions.
9.1. Subsequent to the Effective Date, the E-Med Software, the NS
and all discoveries, improvements, inventions, and trade secrets, conceived
and first reduced to practice with respect thereto, shall be the sole and
exclusive property of E-Med, subject to the licenses granted herein, and E-Med
shall retain any and all rights to make any filings relating to intellectual
property protection thereon.
10. Indemnification.
10.1. E-Med shall indemnify and hold harmless IPA and DHCPs, their
parents, affiliated and subsidiary entities, assignees, licensees, and
purchasers, and the officers, employees, and agents of all of them, against
any suits, losses, liabilities, damages, claims, settlements, costs and
expenses, including reasonable attorneys' and experts' fees, arising from: (i)
any breach of E-Med's representations and warranties or any other provision of
this Agreement by E-Med; (ii) any use of proprietary information E-Med has
obtained from sources other than IPA; or (iii) any claim that the Other E-Med
Software or the NS infringes any patent, copyright, trademark, trade secret or
other proprietary or intellectual property right of any third party.
10.2. IPA shall indemnify and hold harmless E-Med, its assignees,
licensees and purchasers, and the officers, employees, and agents of all of
them, against any suits, losses, liabilities, damages, claims, settlements,
costs and expenses, including reasonable attorneys' and experts' fees, arising
from: (i) any breach of IPA's representations and warranties or any other
provision of this Agreement by IPA; or (iii) any use of proprietary
information IPA has obtained from sources other than E-Med.
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10.3. Under this Section, the party required to provide the
indemnification (the "Indemnifying Party"), at the Indemnifying Party's sole
expense, shall maintain control and direction of the defense of such a claim
or claims brought against the party entitled to indemnification (the
"Indemnified Party"). The Indemnified Party must promptly and in writing
notify the Indemnifying Party of the claim and cooperate in defending against
the claim. If, in the reasonable judgment of the Indemnified Party, the
Indemnifying Party is financially unable to conduct a reasonable defense of
the action, then the Indemnified Party may undertake complete control of the
action, all the while reserving its right to obtain full restitution of all
its fees and costs, including attorneys' and experts' fees, under this
section.
10.4. If in E-Med's reasonable opinion any of the E-Med Software
used under this Agreement is likely to become the subject of such a claim, IPA
agrees to permit E-Med, at E-Med's option and expense, to attempt to either
secure for IPA the right to continue using the E-Med Software or, at no cost
to IPA, replace or modify it so that it becomes noninfringing without
affecting the functionality of the E-Med Software.
11. Proprietary Information.
11.1. During the course of this Agreement, each party may become
aware of information relating to the other party's products, project and
product plans, research and development, inventions, processes, techniques,
designs or other technical, financial, creative and business information, as
well as financial, insurance, and medical information of third parties, such
as patients and clients of IPA or DHCPs. All such information is considered
proprietary and confidential ("Proprietary Information"). Proprietary
Information includes, without limitation, financial information, patient
identities and their medical and financial information, pricing, strategic
partnering and or alliances.
11.2. The parties shall: (i) preserve and protect the
confidentiality of all Proprietary Information (including the execution of
nondisclosure and work for hire agreements by employees or other Persons with
access to Proprietary Information); (ii) not disclose to anyone except as
necessary to carry out the terms hereof, the existence, source, content or
substance of the Proprietary Information; (iii) not use Proprietary
Information in any way other than in furtherance of this Agreement; and (iv)
not disclose, use or copy any information or materials received in confidence
during or subsequent to the term of this Agreement from a third party or about
a third party.
11.3. This Section does not impose any obligation on either party if
the information is: (a) publicly known at the time of disclosure; (b) already
known to the receiving party at the time; (c) furnished by the disclosing
party to others without restrictions on its use or disclosure; or (d)
independently developed by the receiving party without use of the Proprietary
Information.
12. Default; Termination.
12.1. A party will be considered to be in default (a "Default") if
(a) such party breaches or fails to comply with any term of this Agreement,
and it does not correct such breach or failure within thirty (30) days (the
"Cure Period") of receiving notice from the non-defaulting party demanding
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that such breach or failure be corrected; (b) it makes an assignment for the
benefit of its creditors, or a receiver, trustee in bankruptcy or similar
officer is appointed to take charge of all or substantially all of its assets;
(c) it files for relief under any bankruptcy or insolvency laws; (d) it is
declared a bankrupt or insolvent by a court having jurisdiction; or (e)
proceedings are instituted for the liquidation or winding up of its business
or for the termination of its charter. Upon the occurrence of any of such
events, the non-defaulting party may terminate this Agreement without
liability to the other party by delivering a notice of termination to the
defaulting party.
12.2. Neither party shall be deemed to be in Default or liable for
any costs or damages as a result of its failure to comply with its obligations
under this Agreement if such failure is caused by acts of God, riots, fires,
epidemics, war (declared or undeclared), insurrection, rebellion, civil or
military disturbances or unusually severe weather ("Force Majeure"). The
party claiming Force Majeure shall give the other party prompt written notice
of the occurrence of any of the above circumstances and such notice shall
include a statement of the anticipated delays. The period of performance of a
party claiming Force Majeure shall be extended for a period not exceeding the
period of delay; provided that should any of the above circumstances continue
for a period of ten (10) days, the non-performing party shall be considered to
be in Default and the other party shall have the right to immediately
terminate this Agreement by providing written notice to the non-performing
party of such termination.
12.3. Notwithstanding any provision of this Agreement to the
contrary, IPA shall have the right to terminate this Agreement upon payment to
E-Med of the Termination Payment specified on Exhibit C hereto.
13. Relationship of the Parties.
13.1. Each party will be deemed to be an independent contractor and
not an agent, joint venturer, or representative of the other, and neither
party may create any obligations or responsibilities on behalf of or in the
name of the other. Under no circumstances may either party hold itself out to
be a partner, employee, franchisee, representative, servant or agent of the
other party. Each party also agrees not to make false or misleading
statements, claims or representations about the other party, its products, or
the relationship of the parties.
14. Assignment.
14.1. Either party may assign this agreement or any of its rights,
obligations, or privileges hereunder to any successor organization in
connection with the transfer of substantially all of its assets. No other
assignment may be made by either party without the prior written consent of
the other party. Any assignment under this Agreement, to be effective, must
contain the assignee's written assumption of all of the assignor's obligations
hereunder.
15. Nonsolicitation
15.1. Other than the individuals specified on Exhibit D hereto, if
any (whom the Parties have agreed will be hired by E-Med), for the Term,
neither party shall employ a person who was previously employed by the other
party without the other party's prior written consent.
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16. Resolution of Disputes
16.1. General. Except as otherwise provided in this Agreement, in
the event any disagreement, dispute or claim arises between the parties with
respect to the enforcement or interpretation of this Agreement or any specific
terms and provisions set forth in this Agreement (collectively, a "Dispute"),
such Dispute shall be settled in accordance with the following procedures:
16.1.1. Meet and Confer. In the event of a Dispute between
the parties, either party may give written notice to the other party setting
forth the nature of such Dispute ("Dispute Notice"). Such parties shall meet
and confer to discuss the Dispute in good faith within fifteen (15) days of
the other party's receipt of a Dispute Notice in an attempt to resolve the
Dispute ("Meet and Confer Discussions"). Each such party shall select two (2)
representatives, who shall meet at such date(s) and time(s) as are mutually
convenient to the representatives of each participant within the Meet and
Confer Period (as defined below).
16.1.2. Mediation. If the parties are unable to resolve the
Dispute within forty-five (45) days following the date of receipt of the
Dispute Notice (the "Meet and Confer Period"), then the parties agree to try
in good faith to settle the Dispute through non-binding mediation by a single
disinterested third party mediator in accordance with the procedures of
JAMS/Endispute, Inc. A single disinterested third-party mediator shall be
selected by the parties within thirty (30) days following the end of the Meet
and Confer Period. If the parties are unable to agree upon a mediator within
such thirty (30) day period, then the parties shall proceed to binding
arbitration as provided in Section 16.2. Each party shall pay one-half (1/2)
of the expenses of the mediator and the other costs of mediation. The
mediation proceeding shall commence not more than thirty (30) days after the
written notice initiating the mediation process is given by one party to the
other party hereto and shall be conducted in the County of Los Angeles, State
of California. The mediator shall be given written statements of the parties
and may inspect any applicable documents or instruments. All mediation
proceedings shall be attended by the parties with reasonable authority to
resolve the dispute. Further, each party shall bear its own attorneys fees and
costs in connection with the mediation process regardless of the results
thereof.
16.1.2.1. If as a result of the mediation, a settlement is
reached and the parties agree that such settlement shall be reduced to
writing, then (i) the mediator shall be appointed an arbitrator for the sole
purpose of signing the settlement agreement reached through the mediation
process, (ii) the settlement agreement shall have the same force and effect as
an arbitration award, and (iii) judgment may be entered upon the settlement
agreement in accordance in any court of competent jurisdiction with applicable
law.
16.1.2.2. The Meet and Confer Discussions and the mediation
proceeding shall be subject to California Evidence Code Sections 1152 and
1152.5.
16.2. Arbitration of Disputes. If the parties are unable to resolve
the any dispute by mechanism of the mediation process described above, then
the Dispute shall be submitted to binding arbitration by either party giving
written notice to the other party, which arbitration shall be conducted in
accordance with the following provisions:
11
16.2.1. Venue. The arbitration shall be conducted in the
County of Los Angeles, State of California.
16.2.2. Law. The governing law shall be the internal law,
and not the law of conflicts, of the State of California. The parties shall
have the rights of discovery as provided for in Part 4 of the California Civil
Code Procedure and the provisions of Section 1283.05 of the California Code of
Civil Procedure are hereby incorporated by reference into this Agreement
pursuant to the provisions of Section 1283.1(b) of the California Code of
Civil Procedure. In the event that either of said Sections is amended in a
manner which limits or reduces the discovery rights contained in said Sections
as of the date hereof, said amendment shall not be deemed to apply to this
Agreement unless the parties agree in writing that the same shall apply. In
the event that either Section 1283.5 or 1283.1(b) is repealed, the provisions
of Section 1283.05 shall nevertheless continue to apply and the parties shall
have the discovery rights as provided therein as of the date of this
Agreement. The California Evidence Code shall apply to all testimony and
documents submitted to the arbitrator.
16.2.3. Selection. There shall be one (1) impartial third
party arbitrator. If the parties are unable to agree upon a mutually
acceptable arbitrator within thirty (30) days after the demand for arbitration
is given, then the parties stipulate to the arbitration before a single
impartial third party arbitrator who is a retired judge on the Los Angeles
panel of JAMS/Endispute, Inc. and who is selected by the then serving chief
executive officer of JAMS/Endispute, Inc.
16.2.4. Administration. Arbitration shall be administered by
JAMS/Endispute, Inc.
16.2.5. Award. The award rendered by arbitration shall be
final and binding upon the parties, and the award may be entered in any court
of competent jurisdiction in the United States. The award shall be beyond the
power of the arbitrator if the findings of fact are not supported by
substantial evidence or the award is based on an error of law. The award
shall include written findings of fact, a summary of the evidence and reasons
underlying the decision and conclusions of law. As part of the award, the
arbitrator may award reasonable and necessary costs actually incurred by the
prevailing party, including that party's share of the arbitrator's fees, costs
and expenses, as well as any administration fees. The arbitrator or a court
of competent jurisdiction may issue a writ of execution to enforce the
arbitrator's decision. Judgment may be entered upon such decision in
accordance with applicable law in any court having competent jurisdiction
thereof. The prevailing party in the arbitration shall be entitled to have
its attorney's fees paid by the other party.
17. Miscellaneous Provisions.
17.1. Publicity. No party to this Agreement shall issue or cause
the publication of any press release or make any other announcement with
respect to this Agreement or the transactions contemplated hereby without the
prior consent of the other parties, except where such release or announcement
is required by applicable law.
17.2. Notices. All notices, requests, consents, instructions and
other communications required or permitted to be given hereunder shall be in
writing and hand delivered or sent by (i) nationally-recognized next business
12
day delivery service, (ii) facsimile, with a hard copy to be sent by next
business day courier or first class U.S. Mail, or (iii) mailed by certified or
registered first class mail, return receipt requested, postage prepaid,
addressed as set forth below; receipt shall be deemed to occur on the earlier
of the date of actual receipt or receipt by the sender of confirmation that
the delivery was completed or that the addressee has refused to accept such
delivery or has changed its address without giving notice of such change as
set forth herein.
if to E-Med, as follows:
00000 Xxxxxxx Xxxxxxxxx, Xxxxx 000
Xxxxxxxx Xxxxx, Xxxxxxxxxx 00000
Attention: Chief Executive Officer
Facsimile No.: (000) 000-0000
if to IPA as follows:
0000 Xxxxx Xxxxxxx Xxxxxx, X-00
Xxxxxxxx, Xxxxxxxxxx 00000
Attention: Chief Executive Officer
Facsimile No.: (000) 000-0000
or such other address or persons as the parties may from time to time
designate in writing in the manner provided in this Section.
17.3. Entire Agreement. This Agreement, together with the Exhibits
attached hereto, represents the entire agreement and understanding of the
parties hereto with respect to the transactions contemplated herein and
therein, and no representations, warranties or covenants have been made in
connection with this Agreement, other than those expressly set forth herein.
This Agreement supersedes all prior negotiations, discussions, correspondence,
communications, understandings and agreements among the parties relating to
the subject matter of this Agreement and all prior drafts of this Agreement,
all of which are merged into this Agreement.
17.4. Amendments and Waivers. This Agreement may be amended,
superseded, cancelled, renewed or extended, and the terms hereof may be
waived, only by a written instrument signed by the Parties or, in the case of
a waiver, by the party waiving compliance. No delay on the part of any party
in exercising any right, power or privilege hereunder shall operate as a
waiver thereof; nor shall any waiver on the part of any party of any such
right, power or privilege, nor any single or partial exercise of any such
right, power or privilege, preclude any further exercise thereof or the
exercise of any other such right, power or privilege.
17.5. Severability. This Agreement shall be deemed severable and
the invalidity or unenforceability of any term or provision hereof shall not
affect the validity or enforceability of this Agreement or of any other term
or provision hereof.
17.6. Headings. The article and section headings contained in this
Agreement are solely for convenience of reference and shall not affect the
meaning or interpretation of this Agreement or of any term or provision
hereof.
13
17.7. Terms. All references herein to Articles, Sections, and
Exhibits shall be deemed references to such parts of this Agreement, unless
the context shall otherwise require. All references to singular or plural
shall include the other as the context may require.
17.8. Exhibits. The Exhibits attached hereto are a part of this
Agreement as if fully set forth herein.
17.9. Third Party Beneficiaries. Except as expressly contemplated
in this Agreement, this Agreement shall be binding upon and inure solely to
the benefit of each party hereto and nothing in this Agreement is intended to
confer upon any other person any rights or remedies of any nature whatsoever
under or by reason of this Agreement.
17.10. Expenses. Except as expressly provided otherwise in this
Agreement (including Sections 4.6, 4.7, 4.8 and 5.2, each party shall bear all
expenses incurred on behalf of such party in connection with the preparation,
execution and performance of this Agreement, and the transactions contemplated
hereby and thereby.
17.11. Construction. This Agreement was initially prepared by
IPA's counsel as a matter of convenience only, and has been thoroughly
reviewed by E-Med and its legal counsel and, therefore, no interpretation will
be made in favor of E-Med with respect to this Agreement for the reason that
such document was prepared by IPA's legal counsel.
17.12. Counterparts. This Agreement may be executed in
counterparts, each of which shall be deemed an original and all of which
together shall be considered one and the same agreement.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the Effective Date.
X-XXX.XXXX.XXX,
a Nevada corporation
By: /s/ Xxxx Xxxxxxx
Name: Xxxx Xxxxxxx
Title: President
UNIVERSITY AFFILIATES IPA, INC.,
a California nonprofit mutual
benefit corporation
By: /s/ Xxx X. X. Xxxxx
Name: (print) Xxx X. X. Xxxxx
Title: President
14
GUARANTY
This GUARANTY (the "Guaranty") is made as of September 1, 1999 by and
among University Affiliates IPA, Inc., a California nonprofit mutual benefit
corporation ("IPA"), X-XxxXxxx.xxx, a Nevada corporation ("E-Med"), and Sanga
e-Health, LLC, a California limited liability company ("Guarantor").
Capitalized terms used herein have the same meanings as set forth in the
Software License And Services Agreement between IPA and E-Med dated of even
date herewith to which this Guaranty is attached (the "Agreement").
NOW THEREFORE, in order to induce IPA to enter into the Agreement and for
other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the parties agree as follows:
1. Performance and Payment Guaranty.
Guarantor hereby absolutely, unconditionally and irrevocably
guarantees to IPA E-Med's full and prompt payment and full and timely
performance and observance of all the terms and conditions of the Agreement
and will perform E-Med's obligations under the Agreement in the event that
E-Med fails to perform. Guarantor hereby covenants and agrees that if E-Med
should default under the Agreement, Guarantor shall forthwith faithfully
perform and fulfill all of such terms, covenants, conditions and agreements.
Guarantor shall also forthwith pay to IPA all damages, costs and expenses that
may arise in consequence of any default by IPA or the enforcement of this
Guaranty.
This Guaranty shall be a continuing guaranty and the liability of
Guarantor shall in no way be affected, modified or diminished by reason of any
assignment, amendment, renewal, supplement or modification of the Agreement.
2. Waiver.
Guarantor hereby waives: (a) presentment, demand for payment, notice
of dishonor, protest, notice of protest and all other notices or demands in
connection with delivery, acceptance and performance of this Guaranty; (b) any
right to require IPA to pursue any other remedy; and (c) any defense arising
by reason of any defense of E-Med except for a defense arising by reason of
the full performance of its obligations under the Agreement.
3. Further Assurances.
Guarantor will, at its expense, execute, acknowledge and deliver all
such further documentation, instruments and assurances and the like and take
all such further action as IPA shall reasonably require in order to carry out
the intentions of the Agreement or facilitate the performance of E-Med's
obligations under the Agreement.
4. Independent Obligations.
The obligations of Guarantor under this Guaranty are independent of
the obligation of E-Med and separate dispute resolution procedures may be
brought and prosecuted against Guarantor whether or not dispute resolution
procedures are initiated against E-Med, and without the necessity of any
notice of nonpayment, nonperformance or nonobservance, or any notice of
acceptance of this Guaranty, or any other notice or demand to which Guarantor
might otherwise be entitled, all of which Guarantor hereby expressly waives.
Guarantor hereby expressly agrees that the validity of this Guaranty and the
obligations of Guarantor hereunder shall in no way be terminated, affected,
diminished or impaired by reason of the assertion or the failure to assert by
IPA against E-Med, or against E-Med's successors and assigns, of any of the
rights of IPA under the Agreement or otherwise by (a) the release or discharge
of E-Med in any creditors' proceedings, receivership, bankruptcy or other
proceedings, (b) the impairment, limitation or modification of the liability
of E-Med in bankruptcy, or of any remedy for the enforcement of E-Med's
obligations under the Agreement resulting from the operation of any present or
future provision of the United States Bankruptcy Code or other federal or
state statute or from the decision in any court, or (c) the rejection or
disaffirmance of the Agreement in any such proceedings.
5. Notices.
Section 17.2 of the Agreement is incorporated herein by reference as
if Guarantor were a party to the Agreement with the addition of the following
address:
if to Sanga, as follows:
00000 Xxxxxxx Xxxxxxxxx, Xxxxx 000
Xxxxxxxx Xxxxx, Xxxxxxxxxx 00000
Attention: Chief Executive Officer
Facsimile No.: (000) 000-0000
6. Remedies Cumulative.
Each and every right, remedy and power granted to IPA under the
Agreement, by law and equity, shall be cumulative and not exclusive of any
other, and may be exercised by IPA from time to time in such order as IPA
shall determine.
7. Resolution of Disputes.
Section 16 of the Agreement is incorporated herein by reference as if
Guarantor were a party to the Agreement.
8. Miscellaneous.
Sections 17.4, 17.5, 17.11 and 17.12 of the Agreement are
incorporated herein by reference as if Guarantor were a party to the
Agreement.
IN WITNESS WHEREOF, the parties have executed this Guaranty as of the day
and year above written.
UNIVERSITY AFFILIATES, IPA, INC.
By: /s/ Xxx X. X. Xxxxx
Name: Xxx X. X. Xxxxx
Title: President
"IPA"
2
X-XXXXXXX.XXX.
By:/s/ Xxxx Xxxxxxx
Name: Xxxx Xxxxxxx
Title: President
"E-MED"
SANGA E-HEALTH, LLC
By: /s/ Xxxx Xxxxxxx
Name: Xxxx Xxxxxxx
Title: President
"GUARANTOR"
3
EXHIBIT A: WORKPLAN FOR DEVELOPMENT OF NS
Tasks Target Completion Date
EXHIBIT B: IPA PERSONNEL
% of Full Time
Name to be spent on NS
Xxxx Xxxxx
Vice President, Marketing 50%
Xxxx Xxxxx
Marketing Specialist 100%
Xxxx Xxxxxxxxxxx
Marketing Specialist 100%
One support staff to
be named 100%
EXHIBIT C: TERMINATION FEES
TERMINATION DATE: TERMINATION FEE:
Prior to 2nd Anniversary Lesser of (i) $2,000,000 plus the value of
of the Effective Date the stock received by IPA under the Asset
Purchase Agreement to be determined by
multiplying the number of shares of E-Med
Common Stock received by IPA under the Asset
Purchase Agreement by the average closing
price of E-Med Common Stock over the thirty
(30) trading days immediately preceding the
date of termination ("Stock Value), and (ii)
$6,486,162
On or after the 2nd Lesser of (i) $2,000,000 plus the Stock
Anniversary of the Value on the Termination Date, and (ii)
Effective Date and $5,486,162
prior to 3rd Anniversary
of Effective Date
On or after the 3rd Lesser of (i) $2,000,000 plus the Stock
Anniversary of the Value on the Termination Date, and (ii)
Effective Date and prior $4,486,162
to 4th Anniversary of
the Effective Date
On or after the 4th Lesser of (i) $2,000,000 plus the Stock
Anniversary of the Value of the Termination Date, and (ii)
Effective Date and prior $3,486,162
to 5th Anniversary of
the Effective Date
On or after the 5th Lesser of (i) $2,000,000 plus the Stock
Anniversary of the Effective Value on the Termination Date, and (ii)
Date and prior to 6th $2,486,162
Anniversary of the Effective
Date
On or after the 6th Lesser of (i) $2,000,000 plus the Stock
Anniversary of the Effective Value of the Termination Date, and (ii)
Date and prior to 7th $1,486,162
Anniversary of the Effective
Date
On or after the 7th Lesser of (i) $2,000,000 plus the Stock
Anniversary of the Effective Value on the Termination Date, and (ii)
Date and prior to 8th $486,162
Anniversary of the Effective
Date
On or after the 8th Zero (0)
Anniversary of the
Effective Date
EXHIBIT D: CURRENT IPA EMPLOYEES TO BE HIRED BY E-MED
Xxxxxx Xxxxxxx
