OFFICE AND EQUIPMENT USE AGREEMENT
This Office and Equipment Use Agreement (hereinafter referred to as the
"Agreement") is made and executed as of the close of business on the 1st day of
April, 2000 by and among New York Laser Management, L.L.C., a Delaware limited
liability company, (hereinafter referred to as "Newco"), Xxx Xxxxxx, M.D.
(hereinafter referred to as "Provider") and Xxx Xxxxxx, M.D., P.C., a New York
professional corporation (hereinafter referred to as "Moadel PC").
Preliminary Statements:
Provider, a licensed medical professional, together with Moadel PC
provides Refractive Surgery and related services in the area of the Borough of
Manhattan, New York City, New York.
Newco owns certain equipment and assets (none of which include the
practice of medicine or the operation of a health care facility) used in the
performance of Refractive Surgery (as hereinafter defined) and related services.
Provider and Moadel PC desire to use Newco's space, equipment,
non-professional personnel and certain administrative services on a turn-key
basis as their professional offices in connection with Provider's and Moadel
PC's provision of medical services.
Moadel PC desires to employ certain employees, for the purpose of
rendering services at the offices and using the equipment of Newco.
Statement of Agreement
In consideration of the mutual covenants and agreements herein
contained, and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, and on the terms and subject to
the conditions herein set forth, the parties hereto agree as follows:
ARTICLE I
Relationship of the Parties
The relationship under this Agreement between Newco, on the one hand,
and Provider and Moadel PC, on the other hand, shall be that of independent
contractors. The provisions hereof are not intended to create any partnership,
joint venture, agency or employment relationship between the parties. Newco
acknowledges and agrees that Provider and Moadel PC shall retain the exclusive
authority to direct the medical, clinical professional, and ethical aspects of
their respective medical practices. Newco shall neither exercise control over
nor interfere with the physician-patient relationships of Provider or Moadel PC,
which shall be maintained strictly between Provider, Moadel PC and their
patients.
ARTICLE II
Services to be Provided by Newco
Section 2.1 General. Moadel PC and Provider will not act in a manner
that would prevent Newco from performing its duties hereunder, and will provide
such information and assistance to Newco as is reasonably required by Newco to
perform its services hereunder. Newco shall, and shall use its best efforts to
cause its employees to, comply with all applicable federal, state and local
laws, rules and regulations in its provision of services hereunder.
Section 2.2 Offices and Equipment. Newco shall make available to Moadel
PC and Provider the real property located at 00 Xxxx 00xx Xxxxxx, 0xx Xxxxx, Xxx
Xxxx, Xxx Xxxx 00000, and the improvements, equipment and assets located thereon
(together with any subsequent property, improvements, equipment or assets
acquired by Newco in replacement of or in addition to the foregoing, the
"Premises"), for the use of Moadel PC and Provider in the performance of
Refractive Surgery and related services. Newco agrees to maintain the Premises
in a commercially reasonable manner in light of the intended use of the
Premises.
Section 2.3 Practice Management. The parties intend and agree that
Moadel PC and Provider shall continue to manage and administer all aspects of
their practices, unless and only to the extent Newco specifically undertakes a
certain aspect of such management and administration. Such management and
administration shall include, without limitation, all administration,
accounting, purchasing, payroll, legal services, record keeping, bookkeeping,
computer services, information management, printing, postage, duplication
services, provision of non-professional personnel, quality assurance programs,
and billing and collecting from, and contracting with, patients, insurance
companies, managed care payors, governmental entities and other third-party
payors with respect to all professional, medical and other services provided by
Moadel PC or Provider. In connection with the management of the practice, Newco
hereby grants a non-exclusive license to Provider and Moadel PC to use the name
"New York Eye Specialists" in the following limited instances: (a) preparation
and dissemination of advertising and promotional materials, as long as such use
is not in connection with, or for the promotion of, any activity that would
constitute a violation of any obligation owed to Newco, Newco's members, or the
affiliates of Newco's members, (b) billing for procedures or services that
involve the use of the Premises, and (c) any other use that is consistent with
the express provisions of this Agreement. The foregoing license and use of such
name shall be terminated upon delivery of notice to Provider by Newco
terminating same.
Notwithstanding any provision of this Agreement to the contrary:
(a) Newco shall not engage in the practice of medicine, and Provider shall
at all times be responsible for all activities that constitute the practice of
medicine;
(b) this Agreement shall not be construed to require Provider,
or any other medically trained or licensed medical professionals under the
direction or control of Provider, to perform Refractive Surgery at or using the
Premises if in the professional medical judgment of a reasonable ophthalmologist
practicing Refractive Surgery, such use would be detrimental to Provider's
patients; and
(c) Provider and Moadel PC shall have the final authority over
their respective personal budgets, professional policies and procedures,
professional hiring, firing and staffing, and clinical practices.
Section 2.4 Events Excusing Performance. In the event of strikes,
lock-outs, calamities, acts of God, unavailability of supplies or other events
over which Newco has no control, Newco shall not be liable to Moadel PC or
Provider for failure to provide any of the Premises hereunder, and Moadel PC and
Provider shall not have the right to terminate this Agreement, for so long as
such events continue and for a reasonable period of time thereafter; provided,
however, that if such events continue and Newco is not able to provide any
Premises hereunder for a period of one hundred and eighty (180) consecutive days
or more, Newco, Moadel PC or Provider may terminate this Agreement by written
notice to the others.
ARTICLE III
Obligations of Moadel PC and Provider
Section 3.1 Premises Fee. The fees payable to Newco by Moadel PC and
Provider in return for use of the Premises and related services made available
by Newco hereunder (the "Premises Usage Fee") shall be determined on a per
procedure basis, and shall be remitted to Newco promptly following the
performance of the procedure for which the Premises Usage Fee is due. The amount
of the undiscounted Premises Usage Fee with respect to any procedure shall be
comprised of a fee for medical supplies and equipment in the amount of $92.50
and a fee for all other use of the Premises and related services in the amount
of $1,850. Newco may from time to time discount the Premises Usage Fee based on
circumstances related to specific types of procedures, but the parties intend
that the aggregate Premises Usage Fees shall equal the fair market value of the
use of the Premises and related services provided by Newco hereunder.
Notwithstanding the foregoing provisions of this Section, Newco agrees
to waive all Premises Usage Fees charged for any retreatment procedure for which
Provider receives no professional fee or other direct monetary benefit and which
is given on a limited basis consistent with Provider's usual and customary
practices and procedures existing prior to the date of this Agreement. In
addition, any manager of Newco may from time to time require that all managers
of Newco examine whether the fair market value of the use of the Premises and
related services has decreased by more than $86 since it was last agreed to
pursuant to this Agreement or by the unanimous vote or consent of Newco's
managers. In such an examination, the managers of Newco must act in good faith,
but each manager shall be entitled to specify the change in fair market value,
if any at all, in his or her sole discretion. If such an examination results in
a unanimous determination by Newco's managers that the fair market value has
changed by more than $86 since it was last agreed to, Newco shall promptly
change the Premises Usage Fee to reflect, dollar for dollar, such change in fair
market value. Notwithstanding the foregoing, Newco may elect, by the affirmative
vote of a simple majority of its managers, to terminate this Agreement without
liability anytime the Premises Usage Fee drops to less than $1,300. Each party
agrees to act in good faith in any renegotiation of the Premises Usage Fee.
Provider and Moadel PC each agree that the Premises Usage Fee shall not
be reduced for any professional fees paid to Provider or any medical
professional employed by or acting under the direction of Provider or Moadel PC.
Section 3.2 Compliance With Laws. Moadel PC and Provider shall provide
professional services to patients in compliance at all times with, and shall
otherwise comply with, all ethical standards, laws, rules and regulations
applicable to the operations of Moadel PC and Provider. Moadel PC and Provider
shall ensure that Provider and the employees of Moadel PC and Provider have all
required licenses, credentials, approvals or other certifications to perform his
or her duties and services for Moadel PC and Provider. In the event that any
disciplinary actions or medical malpractice actions are initiated against
Provider or any employee of Provider or Moadel PC, Moadel PC and Provider shall
promptly inform Newco of such action and the underlying facts and circumstances.
Moadel PC and Provider shall carry out a program to monitor the quality of
medical care practiced by Provider and Moadel PC.
Section 3.3 Moadel PC's and Provider's Internal Matters. Moadel PC and
Provider shall be responsible for matters involving their respective corporate
governance, employees and similar internal matters, including, but not limited
to, preparation and contents of such reports to regulatory and tax authorities
governing Moadel PC and Provider that Moadel PC or Provider are required by law
to provide, distribution of professional fee income among Provider or the
shareholders of Moadel PC, disposition of Moadel PC's and Provider's property
and hiring and firing of their employees and licensing. The legal, accounting
and other professional services fees incurred by Provider or Moadel PC in
connection with the internal matters of Moadel PC, the distribution of the fee
income among Provider or shareholders of Moadel PC and the personal accounting
of Moadel PC and Provider and similar internal and personal matters, shall be
borne exclusively by Moadel PC and/or Provider.
Section 3.4 Personal Expenses. Except as expressly provided above in
Section 3.2, Provider agrees that, notwithstanding the prior practices
associated with the business of Moadel PC and Provider related to Refractive
Surgery as conducted prior to the date of this Agreement, all liabilities,
obligations, costs and expenses that arise after the date of this Agreement and
are personal to Provider (or arose from transactions or occurrences that
directly benefited Provider in a capacity other than as a member of Newco) shall
not be considered expenses of Newco and shall be borne solely by Provider,
unless agreed otherwise by the unanimous vote or written consent of the managers
of Newco. With respect to any such personal expenses that were incurred prior to
the date of this Agreement, such expenses shall not be incurred or reimbursed
by, or charged or netted from amounts owed to, Newco after the date of this
Agreement.
ARTICLE IV
Term and Termination
This Agreement shall commence on the date hereof and shall expire on
the earlier of (a) the 40th anniversary of the date of this Agreement or (b) the
expiration of two (2) full years following the later of (i) the six-year
anniversary of the date of this Agreement or (ii) the first time at which
Provider and his affiliates do not own any direct or indirect ownership interest
in Newco.
ARTICLE V
General Provisions
Section 5.1 Amendments and Waivers. Any modification or amendment to,
or waiver of, any provision of this Agreement (or any document delivered
pursuant to this Agreement unless otherwise expressly provided therein) may be
made only by an instrument in writing executed by each party thereto.
Section 5.2 Successors and Assigns. No party's rights or obligations
under this Agreement may be assigned without the prior written consent of all
parties hereto. Any assignment in violation of the foregoing shall be null and
void. Subject to the preceding sentences of this Section, the provisions of this
Agreement (and, unless otherwise expressly provided therein, of any document
delivered pursuant to this Agreement) shall be binding upon and inure to the
benefit of the parties hereto and their respective heirs, legal representatives,
successors, and assigns.
Section 5.3 Invalid Provisions. If any provision of this Agreement is
held to be illegal, invalid, or unenforceable under present or future laws, such
provision shall be fully severable, this Agreement shall be construed and
enforced as if such illegal, invalid, or unenforceable provision had never
comprised a part of this Agreement, and the remaining provisions of this
Agreement shall remain in full force and effect and shall not be affected by the
illegal, invalid, or unenforceable provision or by its severance from this
Agreement.
Section 5.4 Waiver. No failure or delay on the part of any party in
exercising any right, power, or privilege hereunder or under any of the
documents delivered in connection with this Agreement shall operate as a waiver
of such right, power, or privilege; nor shall any single or partial exercise of
any such right, power, or privilege preclude any other or future exercise
thereof or the exercise of any other right, power or privilege.
Section 5.5 Notices. Any notices required or permitted to be given
under this Agreement shall be given in writing and shall be deemed received (a)
when delivered personally or by courier service to the relevant party at its
address as set forth below or (b) if sent by mail, on the third (3rd) day
following the date when deposited in the United States mail, certified or
registered mail, postage prepaid, to the relevant party at its address indicated
below:
Newco: 0000 Xxxxxxx xx Xxxxx Xxxxxxx
Xxxxx X-000
Xxxxxx, Xxxxx 00000
Attention: President
Facsimile: (000) 000-0000
with a copy to: Xx. Xxxxxxx X. XxXxxx
Akin, Gump, Strauss, Xxxxx & Xxxx, L.L.P.
000 Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Facsimile: (000) 000-0000
Moadel PC: New York Eye Specialists
00 Xxxx 00xx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxx Xxxxxx, M.D.
Facsimile: (000) 000-0000
Provider: Xxx Xxxxxx, M.D.
New York Eye Specialists
00 Xxxx 00xx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Facsimile: (000) 000-0000
with a copy to: Xx. Xxxxxxx Xxxxxx
Xxxxxx Xxxxxx, LLP
The Chrysler Building
000 Xxxxxxxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, XX 00000
Facsimile: (000) 000-0000
Each party may change its address for purposes of this Section by
proper notice to the other parties.
Section 5.6 Survival of Representations, Warranties, and Covenants.
Regardless of any investigation at any time made by or on behalf of any party
hereto or of any information any party may have in respect thereof, all
covenants, agreements, representations, and warranties made hereunder or
pursuant hereto or in connection with the transactions contemplated hereby shall
survive the execution of this Agreement.
Section 5.7 Construction. This Agreement and any documents or
instruments delivered pursuant hereto or in connection herewith shall be
construed without regard to the identity of the person who drafted the various
provisions of the same. Each and every provision of this Agreement and such
other documents and instruments shall be construed as though all of the parties
participated equally in the drafting of the same. Consequently, the parties
acknowledge and agree that any rule of construction that a document is to be
construed against the drafting party shall not be applicable either to this
Agreement or such other documents and instruments.
Section 5.8 Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of Texas.
Section 5.9 Arbitration. Any controversy between the parties regarding
this Agreement, any claims arising out of any breach or alleged breach of this
Agreement and any claims arising out of the relationship between the parties
created hereunder shall be submitted to binding arbitration by all parties
involved. In any arbitration proceeding pursuant to this Section, the prevailing
party in such proceeding shall be entitled to recover its costs and reasonable
attorneys' fees in addition to any other relief granted. The arbitration
proceedings shall be conducted by a single arbitrator pursuant to the Commercial
Arbitration Rules of the American Arbitration Association (subject to the
express provisions of this Section). The arbitration shall be conducted in
Austin, Texas, but the arbitrator shall not have the right to award punitive or
exemplary damages against either party.
Section 5.10 Counterparts. This Agreement may be executed in several
counterparts, each of which shall constitute an original and all of which
together shall constitute one and the same instrument. Any party hereto may
execute this Agreement by signing any one counterpart.
[Signature page follows]
S-1
SIGNATURE PAGE
TO
OFFICE AND EQUIPMENT USE AGREEMENT
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year first above written.
Newco: New York Laser Management, L.L.C.
Xxxxx Xxxxxx, signing as a manager
of Newco and on behalf of Prime, as a member of Newco
Xxx Xxxxxx, signing as both a manager
and a member of Newco
Moadel: _______________________________________________
Xxx Xxxxxx, M.D.
Moadel PC: Xxx Xxxxxx, M.D., P.C.
By:
Xxx Xxxxxx, M.D., President
