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EXHIBIT 10(jj)(1)
ASSIGNMENT AND ASSUMPTION OF INTERIM MANAGEMENT AGREEMENT
This Assignment and Assumption of Interim Management Agreement
("Agreement") is made and entered into this 15th day of July, 1997, by and
between National Medical Review Offices, Inc., with offices at 0000 Xxxxxxxx
Xxxxxxxxx, Xxxxx 000, Xxx Xxxxxxx, Xxxxxxxxxx ("Assignor"), and Substance
Abuse Technologies, Inc., a corporation organized under the laws of the
State of Delaware, with offices at 0000 X.X. 00xx Xxxxxx, Xx. Xxxxxxxxxx,
Xxxxxxx 00000 ("Assignee"). Assignor and Assignee are collectively referred
to as the "Parties."
WITNESSETH
WHEREAS, Assignor entered into a letter of intent with Global Med
Technologies, Inc. ("GMTI"), dated June 20, 1997 (the "GMTI Letter")(the Parties
acknowledge that Assignor has not provided Assignee with a copy of the GMTI
Letter), which describes the terms of the proposed acquisition by Assignor from
GMTI (the "NMRO Acquisition") of the DataMed International Division of GMTI
("DataMed"), located at 00000 Xxxx Xxxxxx, Xxxxx X-000, Xxxxxxxx, Xxxxxxxx
00000-0000 (the "Premises");
WHEREAS, pursuant to the GMTI Letter, Assignor and GMTI entered into an
Interim Management Agreement dated July 3, 1997 (the "Management Agreement"),
pursuant to which direction and control of the operations of DataMed have been
transferred from GMTI to NMRO as of June 30, 1997, on an interim basis until the
closing of the NMRO Acquisition;
WHEREAS, Assignor and Assignee entered into a Letter of Agreement (the
"Letter Agreement"), dated July 3, 1997, pursuant to which the Assignor agreed
to sell, and Assignee agreed to purchase, subject to certain conditions and
reservations, the assets of DataMed purchased by Assignor from GMTI, in
consideration of the payment by Assignee of $1,600,000.00 and the assumption by
Assignee of certain scheduled liabilities (the "SAT Acquisition");
WHEREAS, the Letter Agreement provides for Assignee to assume directly
the operations of DataMed no later than July 11, 1997 (with a retroactive effect
to June 30, 1997);
WHEREAS, Assignor announced its intention to assign the Management
Agreement to Assignee, and in response, GMTI stated that (i) GMTI adamantly
objected to any such assignment, and (ii) GMTI would not sign the final asset
purchase agreement with Assignor unless the asset purchase agreement contained a
provision amending the Management Agreement to make it non-assignable;
WHEREAS, Assignor has been managing DataMed pursuant to the Management
Agreement, and the Parties jointly elected to delay temporarily the assignment
of the Management Agreement by Assignor to Assignee, in order to allow the
Parties to be better positioned to take
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immediate action in response to any action taken by GMTI that would obstruct or
otherwise interfere with the assignment and assumption of the Management
Agreement;
WHEREAS, Assignor now desires to assign all of its rights, title and
interests in and to the Management Agreement to Assignee, and Assignee now
desires to accept assignment and assume and perform the obligations of Assignor
under the Management Agreement, in accordance with the covenants, conditions and
restrictions of this Agreement.
AGREEMENTS
NOW, THEREFORE, in consideration of the premises and of the mutual
covenants, conditions, and restrictions hereinafter set forth, the Parties
hereby agree as follows:
1. Assignment. Subject to the covenants, conditions, and restrictions
set forth herein, Assignor hereby unconditionally assigns and transfers to
Assignee, effective as of the 11th day of July, 1997 (the "Effective Date"), all
of Assignor's right, title and interest in and to the Management Agreement, a
copy of which is attached hereto as Exhibit A. Assignor represents and warrants
that (i) the Management Agreement attached hereto as Exhibit A constitutes the
entire agreement between Assignor and GMTI with respect to the management of
DataMed by Assignor, and (ii) the Management Agreement is in full force and
effect as of the date hereof.
2. Assumption. Subject to the covenants, conditions, and restrictions
set forth herein, Assignee hereby accepts the foregoing assignment and agrees
fully and faithfully to assume and perform each and every obligation, term,
condition and covenant to be performed by Assignor in accordance with and
subject to the covenants, conditions and restrictions set forth in the
Management Agreement, including, without limitation, the provisions creating a
retroactive effect to June 30, 1997. Notwithstanding the foregoing, the Parties
acknowledge and agree that Assignee shall not be liable to Assignor for failure
to perform any of the obligations required under the Management Agreement if and
to the extent that such performance by Assignee is prevented by the actions or
conduct of GMTI.
3. Withdrawal of Assignor on Future Date Certain. The Parties agree
that Assignor will withdraw from direct participation in the direction and
control of DataMed on a future date to which the Parties will hereafter agree.
The Parties agree that this date will be selected in order to maximize the
ability of the Parties to effectively oppose any action that GMTI may take to
obstruct or otherwise interfere with the assignment and assumption of the
Management Agreement in accordance with this Agreement, and the performance by
Assignee of the management functions thereunder. If GMTI takes any action that
obstructs or otherwise interferes with the assignment and assumption of the
Management Agreement, or the performance by Assignee of the management functions
thereunder, then the Parties agree that Assignor will continue to manage DataMed
in accordance with the following: (i) Assignor agrees to manage DataMed as SAT's
agent under the Management Agreement in accordance with the provisions of
Section 4 below; (ii) Assignee agrees to reimburse all of Assignor's labor and
expenses incurred in such management of DataMed; and (iii) Assignor's
obligations will terminate at such time as the Parties mutually agree, but not
later than termination of the Management Agreement.
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4. Relation Prior to Withdrawal by Assignor. Prior to the withdrawal by
Assignor from direct participation in the direction and control of DataMed on
the date set by the Parties in accordance with Section 3 above, Assignor will
continue to participate in the direction and control of DataMed at the Premises,
subject to the rights of Assignee hereunder and under the Management Agreement.
Assignor will not be a fiduciary or trustee, or have any fiduciary duty or
obligation to Assignee. Assignor's sole obligation shall be to maintain the
status quo of DataMed operations, except pursuant to the prior instruction or
authorization of Assignee. Assignor makes no warranties, express or implied, as
to the results of operation of DataMed, or the net book value, net worth,
liquidation value, or any other value of DataMed or any of its assets upon
withdrawal by Assignor as required hereunder, and in no event will Assignor be
liable to Assignee, or any person or entity engaged by or under contract with
Assignee, for any losses, liabilities, or damages, including, without
limitation, any lost profits, lost savings, or other incidental, special or
consequential damages, incurred by Assignee, its agents or employees, as a
result of Assignor's participation in the operation of DataMed as described
hereunder, even if Assignor has been advised of the possibility of such damages,
except for any such damages or liability caused by the unlawful conduct or gross
negligence of Assignor, its agents or employees.
5. Continuing Access to Information. During the term of this Agreement,
Assignor and its agents shall have the continuing right during DataMed's normal
business hours and upon reasonable prior notice, to inspect, copy and make
extracts from, DataMed's books of account and records, and GMTI's books of
account and records relating to the operations of DataMed and maintained by GMTI
during the period from and including June 20, 1997 through and including the
termination date of this Agreement, including specifically but without
limitation, records of xxxxxxxx, collections, expenses and disbursements,
records of meetings of GMTI's shareholders, board of directors and any and all
committees thereof, and records of agreements, instruments, judgments orders and
other written obligations of Company that materially affect Assignor's rights or
the performance of its duties hereunder.
6. Continuing Access to Premises. During the term of the Management
Agreement, Assignor and its agents shall have the continuing right to enter,
inspect, and use the Premises at such times as may be reasonably necessary and
appropriate under this Agreement and the Letter Agreement, including, but not
limited to, the right for Assignor's employees and agents, and any equipment,
inventory or other supplies or documents owned or leased by Assignor, to be in
such Premises.
7. Indemnity by Assignee. Assignee shall defend, indemnify and hold
Assignor harmless from and against all liability (statutory or otherwise)
claims, suits, demands, damages, judgments, costs, interests and expenses
(including reasonable attorneys' fees and disbursements incurred in the defense
thereof) which Assignor may incur (except if and to the extent that it arises
out of any error, act or omission of Assignor) as a result of any events that
occur after the Date established pursuant to Section 3, and that arise out of or
are connected with Assignee's performance or failure to perform under the
Management Agreement. The obligations of Assignee set forth in this paragraph
shall survive the expiration or earlier termination of the Management Agreement,
and any conveyance, assignment or other transfer of Assignee's rights
thereunder.
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8. Indemnity by Assignor. Assignor shall defend, indemnify and hold
Assignee harmless from and against all liability (statutory or otherwise)
claims, suits, demands, damages, judgments, costs, interests and expenses
(including reasonable attorneys' fees and disbursements incurred in the defense
thereof) which Assignee may incur (except if and to the extent that it arises
out of any error, act or omission of Assignee) as a result of any events that
occur on or prior to the Date established pursuant to Section 3, and that arise
out of or are connected with Assignor's performance or failure to perform under
the Management Agreement. The obligations of Assignor set forth in this
paragraph shall survive the expiration or earlier termination of the Management
Agreement, and any conveyance, assignment or other transfer of Assignee's rights
thereunder.
9. Further Assurances. Each Party hereto agrees to execute
such other documents and take such other actions as may be reasonably
necessary or desirable to confirm or effectuate the transfer, assignment and
assumption contemplated hereby.
10. Notices. All notices, demands or requests required or authorized
hereunder shall be deemed given sufficiently if in given in writing and sent by
nationally recognized overnight courier, registered mail or certified mail,
return receipt requested and postage prepaid, or by tested telex, telegram or
cable to:
In the case of NMRO:
National Medical Review Offices, Inc.
0000 Xxxxxxxx Xxxx., Xxxxx 000
Xxx Xxxxxxx, XX 00000
Attention: Xxxxxx Xxxxx M.D.
In the case of SAT:
Substance Abuse Technologies, Inc.
0000 X.X. 00xx Xxxxxx
Xx. Xxxxxxxxxx, Xxxxxxx 00000
Attention: Xxxxxx Xxxxxxx, Chief Executive
Officer
If such notice, demand or other communication is served personally, service
shall be conclusively deemed made at the time of such personal service. If such
notice, demand, or other communication is given by mail, service shall be
conclusively deemed given three (3) business days after the deposit thereof in
the United States Mail addressed to the party to whom such notice, demand, or
other communication is to be given, as hereinabove set forth. Any party hereto
may change his or its address for the purpose of receiving notices, demands, or
other communications provided herein by giving a written notice in the manner
stated above to the other party or parties stating such change of address.
11. Entire Agreement. This Agreement constitutes the entire agreement
of the parties with respect to the Management Agreement, and supersedes all
prior written or oral agreements,
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understandings, and negotiations, and all contemporaneous oral agreements,
understandings, and negotiations between the parties with respect to the
Management Agreement.
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00. Severability. Except as provided herein, any portion or
provision of this Agreement which is deemed by law to be invalid, illegal,
or unenforceable shall be ineffective to the extent of such invalidity,
illegality, or unenforceability, without affecting in any way the remaining
portions or provisions hereof.
13. Attorneys' Fees. Attorneys' Fees. If any legal
action, arbitration or other proceeding is initiated for the enforcement of
this Agreement or any portion hereof, or because of any alleged dispute,
breach, or misrepresentation in connection with any of the provisions of this
Agreement, in addition to any other relief to which such party may be
entitled, the prevailing party in such action shall be entitled to recover
its reasonable attorneys' fees, as determined by the arbitrator or court,
and all other costs and expenses awarded in connection with such action or
proceeding.
14. Governing Law. The validity, interpretation and
construction of this Agreement and of each part hereof shall be governed by
the laws of the State of California, and this Agreement shall bind and
inure to the Parties hereto and their respective representatives, successors
and assigns.
15. Counterparts. This Agreement may be signed in one or more
counterparts, all of which when taken together shall constitute one
instrument. For convenience, original signatures may be transmitted by
facsimile.
IN WITNESS WHEREOF, Assignor and Assignee have executed this Assignment
and Assumption of Fund Management Agreement to be effective as set forth above.
ASSIGNEE:
SUBSTANCE ABUSE TECHNOLOGIES, INC.
By
Xxxxxx Xxxxxxx, Chief Executive Officer
ASSIGNOR:
NATIONAL MEDICAL REVIEW OFFICES, INC.
By
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Xxxxxx Xxxxx, M.D., President
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EXHIBIT A
Interim Management Agreement
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