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EXHIBIT 10.9
FORM OF CONSULTING AND BUSINESS SERVICES AGREEMENT
THIS CONSULTING AND BUSINESS SERVICES AGREEMENT (this
"Agreement"), dated as of _______________, 199__ , by and between BETTER IMAGE,
INC., a Georgia corporation, and its successors or assigns ("BII") and
_________________________________, a ____________ professional corporation (the
"Entity").
W I T N E S S E T H:
WHEREAS, the Entity owns and operates a cosmetic and
reconstructive surgery practice with offices located in the facilities
(identified in Exhibit A, as amended from time to time (collectively, the
"Center"), and furnishes specialized medical care to the general public through
the services of the surgeons affiliated with the Entity at the Center (the
"Surgeon(s)"); and
WHEREAS, BII is a company which has been formed to provide
business and consulting services to cosmetic and reconstructive surgery
practices;
WHEREAS, BII's services are designed to improve the efficiency
and profitability of cosmetic and reconstructive surgery practices while
enhancing the ability of the surgeons in such practices to render quality
specialized medical care to their patients;
WHEREAS, the Entity and BII mutually desire to enter into a
business relationship under the terms of this Agreement.
NOW THEREFORE, in consideration of the foregoing, and of the
mutual covenants and agreements herein contained, the parties hereto agree as
follows:
I. RESPONSIBILITIES OF BII
1.1 General. BII shall furnish the Entity the business and
consulting services described in this Agreement, subject to the requirements of
New York law relating to, without limitations, the control by physicians and
surgeons over the practice of medicine.
1.2 Facilities and Equipment. BII will consult with and advise
the Entity on its equipment and office needs and the efficient configuration of
its office space and will arrange for all equipment and furnishings determined
by the Entity to be necessary for the operation of the Center, as specified on
Exhibit 1.2 (together with any future asset purchases in accordance herewith,
the "Assets"). The Entity shall have complete custody and control over the
Assets provided to the Entity by BII, including, without limitation, the right
to make decisions, after consultation with BII, with respect to the repair,
replacement, modification and upkeep of such Assets. Unless the Entity
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chooses to directly purchase furnishings, equipment and related assets in the
future, BII shall purchase such assets and lease such assets to the Entity under
a capital leasing arrangement with such terms as mutually agreed to by the
Entity and BII. If the Entity chooses to purchase such assets, then it shall
depreciate such assets in accordance with generally accepted accounting
principles ("GAAP").
1.3 Personnel and Payroll. BII will consult with the Entity on
its staffing needs. BII will employ the staff determined by the Entity to be
necessary for the Center's operations, as specified on Exhibit 1.3, except for
the Surgeons and other personnel required by applicable state law or regulation
to be employed by the Surgeon (the "Medical Staff"), who will be employed by the
Entity. At the election of the Entity, BII will additionally assist in staff
scheduling, administer the Center's payroll and provide payroll accounting
services. The parties expressly agree that the Entity will have discretion and
control over all personnel and staffing matters in respect to the Center's
staff.
1.4 Business Systems, Procedures and Forms. BII will advise
the Entity on and assist in the implementation and operation of business systems
and procedures. BII will provide training to the Center's staff in the use of
such systems and procedures. BII will additionally provide the Entity clinical
forms developed in consultation with the Entity and will provide training to the
Center's staff in the use of such forms. The Entity expressly acknowledges and
agrees that it shall have no property rights in the foregoing systems,
procedures or clinical forms, and further agrees that such systems, procedures
and forms shall be deemed to constitute Confidential Information within the
meaning of Section 2.8 hereof and shall be subject to the restrictions on the
use, appropriation and reproduction of such Confidential Information provided
for in Section 2.8. The parties agree that the Entity's use of any such systems,
procedures and forms shall be at the Entity's sole discretion and,
notwithstanding its use of any such systems, procedures, or forms, the Entity
shall retain control over the management of all aspects of the Center's
operations, including, without limitation, patient scheduling.
1.5 Purchasing and Inventory Control. BII, in consultation
with the Entity, will provide the Entity purchasing services for inventory and
supplies and will be responsible for maintaining the Center's inventory. The
price charged to the Center for such inventory and supplies shall be the same as
the price paid by BII, including any rebates. In any event, the Entity has the
right to purchase its supplies from the supplier of its choice.
1.6 Accounting Services and Financial Reporting. BII will
advise the Entity with respect to and provide or arrange for all accounting and
bookkeeping services reasonably required for the Center's normal and routine
operations. BII will additionally advise the Entity on and assist in
implementing information systems designed in consultation with the Entity to
generate financial and operational data concerning the Center. BII will prepare
and submit to the Entity monthly operating data and quarterly financial reports
with respect to the Center's operations. BII will analyze such data on an
ongoing basis to advise the Center on improving productivity.
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1.7 Malpractice Insurance. BII shall use reasonable efforts
to obtain under its blanket policies for the Surgeon as a Center Expense
malpractice insurance that meets the coverage requirements set forth in Section
4.1 hereof.
1.8 Marketing. BII will advise the Entity in designing and
assist in executing a marketing plan to promote the Center's professional
services. In connection with the development of the marketing plan, BII will
advise the Entity on establishing an installment plan for patient payments, and,
in the event the Entity elects to offer such a plan, will assist in implementing
and administering the plan. The Entity shall exercise sole discretion and
control over all policies and decisions relating to marketing, pricing, credits,
refunds, warranties and advertising. All marketing activities hereunder will be
conducted in compliance with applicable laws and regulations of the State of New
York governing the medical profession.
1.9 Planning. BII will assess the business potential of
establishing offices in new locations, and, in the event the Entity elects to
relocate or open an office in a new location, subject to mutual agreement, BII
will provide assistance to the Entity as appropriate.
1.10 Billing and Collections. BII shall provide billing and
collection services for all professional services rendered at the Center, all
such billing and collections to be done in the name of and subject to the
control of the Entity.
1.11 Payment Services. On a continuous basis, the accounts
receivable of the Entity shall be deposited with BII for the Entity's account,
and BII shall use the funds collected from such accounts receivable to pay the
Consulting Fee (as hereinafter defined) and to pay, on the Entity's behalf as a
Center Expense (as hereinafter defined) and otherwise, all expenses of the
Entity duly authorized for payment by the Entity and shall return to the Entity
any funds remaining after payment in full of such items.
1.12 Disbursement of Funds. (a) All monies collected by BII
from the Entity's accounts receivable pursuant to Section 1.10 above shall be
deposited into an account (the "Entity Account") with a bank whose deposits are
insured with the Federal Deposit Insurance Corporation. The Entity Account shall
contain the name of the Entity, but BII shall make all disbursements therefrom.
BII shall account for all monies so disbursed from the Entity Account. From the
funds collected and deposited each month by BII in the Entity Account, BII shall
make the following disbursements, among others, promptly when payable.
(i) Compensation payable to all employees of the Entity, and
all taxes and assessments payable to local, state and Federal
governments in connection with the employment of such
personnel; and
(ii) All other sums otherwise due and payable by the Entity as
Center Expenses or otherwise, including, without limitation,
the Consulting Fee.
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(b) In the event the funds in the Entity Account will, at any
time, be insufficient to cover current expenses, BII shall notify the Entity and
BII shall advance to the Entity the necessary funds to pay current expenses for
the benefit of the Entity, which advances will be deemed to be loans to the
Entity to be repaid upon such terms as agreed to by the Entity and BII, which
indebtedness shall be deemed a Center Expense for purposes of Article III
hereof; provided, however, that in any event the outstanding principal amount of
such indebtedness shall bear interest at an annual rate adjusted on the first
calendar day of each month to reflect that certain rate from time to time
published by the Wall Street Journal as the prime rate, as of the last business
day of the immediately preceding month for which such prime rate was published
(the "Prime Rate"), plus one percent (1%).]
1.13 Records. BII shall organize and develop systems in
consultation with the Entity with respect to all files and records relating to
the business operations of the Center, including, but not limited to,
accounting, billing and collection records. The parties expressly acknowledge
and agree that patient records shall at all times be and remain the property and
under the control of the Orthodontist and shall be located at the Entity's
facilities so that they are readily accessible for patient care. The management
of all files and records shall comply with applicable state and federal
statutes. BII shall use its reasonable efforts to preserve the confidentiality
of patient medical records and use information contained in such records only
for the limited purpose necessary to perform the services set forth herein;
provided, however, in no event shall a breach of said confidentiality be deemed
a default under this Agreement.
II. OBLIGATIONS OF THE ENTITY
2.1 General. The Entity will be responsible for the
management of the Center, in accordance with the requirements of New York law.
2.2 Employment of Surgeons and Rendering of Patient Care. The
Entity will be responsible for the employment of all Surgeon(s) and Medical
Staff affiliated with the Entity and supervision of all care and services
rendered to patients.
2.3 Professional Services. The Entity shall use and occupy
the offices and facilities designated on Exhibit 1.2 exclusively for the
practice of cosmetic and reconstructive surgery services and shall comply with
all applicable local rules, ordinances and all standards of medical care. It is
expressly acknowledged by the parties that the surgical practice conducted at
the Center shall be conducted solely by the Surgeons associated with the Entity
and no other surgeon shall be permitted to use or occupy the Center or Centers,
except as provided in Exhibit B. The Entity shall provide professional services
to patients hereunder in compliance at all times with ethical standards and laws
and regulations applying to the medical profession. The Entity shall ensure that
each Surgeon providing medical services to patients at the Center is licensed by
the state in which such services are provided. In the event that any
disciplinary, medical malpractice or other actions
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are initiated against any such Surgeon, the Entity shall immediately notify BII
of such action and the underlying facts and circumstances. The Entity shall
cooperate with and participate in quality assurance/utilization review programs
established by BII or mandated by accreditation and/or licensure standards
applicable to the practice of medicine.
2.4 Records. The Entity will keep or cause to be kept
accurate, complete and timely medical and other records of all patients. Such
records shall be sufficient to enable BII, on behalf of the Entity, to obtain
payment for the services and facilities and to facilitate the delivery of
quality patient care by the Surgeon.
2.5 Professional Expenses. Payments expended each fiscal year
by the Entity on behalf of the Surgeon and other surgeons delivering patient
care at the Center(s) for continuing education, seminars, professional license
fees and dues, professional memberships, expenses related to a company
automobile for the Surgeon, and all other expenses of the Surgeon and other
surgeons delivering patient care at the Center(s) that do not directly benefit
the Entity (as reasonably determined by BII), up to the amount of three percent
(3%) of the Entity's Adjusted Gross Revenue, shall be considered a Center
Expense. To the extent that such expenses exceed three percent (3%) of the
Entity's Adjusted Gross Revenue for such year, the Center Expenses shall be
reduced by such excess amount solely for the purpose of calculating the
Consulting Fee; provided, however, that the Entity shall pay such excess
expenses. Notwithstanding the foregoing, the Entity shall be solely responsible
for the cost of professional licensure fees and board certification fees,
membership in professional associations and continuing professional education
incurred by the Surgeon. The Entity shall ensure that the Surgeon participates
in such continuing education as is necessary for such Surgeon to remain current.
2.6 Professional Insurance Eligibility. The Entity shall
cooperate in the obtaining and retaining of professional liability insurance by
assuring that each of its Surgeons is insurable and participating in an on-going
risk management program.
2.7 Employment Agreement. The parties recognize that the
services to be provided by BII are feasible only if the Entity operates an
active practice to which it and each Surgeon devote their full time and
attention. Simultaneously with the execution of this Agreement, each Surgeon who
is or becomes an equity owner of the Entity or who delivers patient care at the
Center(s) on average more than ten (10) days each month, whether on the date
hereof or at any time during the term of this Agreement, shall enter into an
employment agreement with the Entity in substantially the form attached hereto
as Exhibit C.
2.8 Confidentiality. The Entity agrees and acknowledges that
all materials provided by BII or a BII Affiliate (as hereinafter defined) to the
Entity or an Entity Agent (hereinafter defined), including all trade secrets,
constitute "Confidential Information" and are disclosed in confidence and with
the understanding that such materials constitutes valuable business information
developed by BII at great expenditures of time, effort, and
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money. Trade secrets are property rights protected by law and, for purposes of
this Agreement, shall have the meaning provided under applicable state and
Federal law. The Entity shall not, directly or indirectly, without the express
prior written consent of BII, use or disclose such Confidential information for
any purpose other than in connection with the services to be rendered hereunder.
The Entity shall: (i) keep strictly confidential and hold in trust all
Confidential Information and not disclose such Confidential Information to any
third party without the express prior written consent of BII; and (ii) impose
this obligation of confidentiality on the Entity's affiliates, co-owners,
associates, partners, employees, shareholders, members and independent
contractors (collectively, the "Entity Agents"). The Entity acknowledges that
the disclosure of Confidential Information to it by BII is done in reliance upon
its representations and covenants hereunder. Upon expiration or termination of
this Agreement by either party for any reason whatsoever, the Entity shall
immediately return and shall cause all Entity Agents to immediately return to
BII all Confidential Information (except to the extent such Confidential
Information includes patient information), and the Entity shall not, and shall
cause all Entity Agents not to, thereafter use, appropriate, or reproduce such
Confidential Information. The Entity further expressly acknowledges and agrees
that any such use, appropriation, or reproduction of any such Confidential
Information by any of the foregoing after the expiration or termination of this
Agreement will result in irreparable injury to BII, that the remedy at law for
the foregoing would be inadequate, and that in the event of any such use,
appropriation, or reproduction of any such Confidential Information after the
termination or expiration of this Agreement, BII, in addition to any other
remedies which may be available to it, shall be entitled to injunctive or other
equitable relief. As used in this Agreement, the term "BII Affiliate" shall mean
(i) each corporation or other business entity directly or indirectly
controlling, controlled by, or under common control with BII and (ii) each
cosmetic or reconstructive surgery practice to which BII provides management or
consulting services, other than the Entity, the employees and principals of such
practices, and each corporation or other business entity directly or indirectly
controlling, controlled by, or under common control with each such practice or
the principals thereof.
2.9 Covenant Not to Compete. During the term of this
Agreement, the Entity, and any of its members or shareholders, agrees not to
establish, develop or open any offices for the provision of cosmetic and
reconstructive surgery services within a ten (10) mile radius of any facility
compromising the Center (the "Area of Dominant Influence") without the express
written consent of BII. For a period of two (2) years following the termination
of this Agreement, the Entity and each of its shareholders shall be prohibited
within the Area of Dominant Influence (i) from advertising in print (except for
yellow page advertising and announcements for the opening of a practice) or
electronic media of any kind, (ii) from soliciting in any manner patients,
surgeons or staff associated with the Centers, and (iii) from soliciting any
referrals from any physician who referred one or more patients to the Center
within the three (3) years prior to the date of such termination. In the event
the Entity terminates this Agreement pursuant to Section 5.2(b), then this
Section 2.9
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shall be void and of no further effect; provided, however, the remainder of this
Agreement shall remain in full force and effect.
III. FINANCIAL ARRANGEMENTS
3.1 Consulting Fees. BII shall receive an annual Consulting
Fee, subject to the provisions of Section 3.3 below, of __________ per year,
payable montly. On the first anniversary thereafter during the term hereof, the
Consulting Fee shall be increased by three percent (3%) per year.
3.2 Center Expenses. BII shall be responsible for the payment
of all Center Expenses, as defined below, during the term of this Agreement and
the Entity shall immediately reimburse BII for such payments from funds held in
the Entity Account.
3.3 Definitions. For the purposes of this Agreement, the
following definitions shall apply and shall comply with generally accepted
accounting principles:
a. "Center Expenses" shall mean all operating and
non-operating expenses incurred in the operation of the
Center, including, without limitation:
(i) Salaries, benefits, payroll taxes, workers
compensation, health insurance, 401(k) and other benefit
plans, and other direct costs of all employees of BII at
the Center, including nurses, (but excluding all
Surgeons); provided that only expenses for health
insurance, 401(k) and other benefit plans approved by the
Entity shall be included;
(ii) Direct costs of all employees or consultants of BII
who, upon mutual agreement of BII and the Entity, provide
services at or, if consented to by the Entity, in
connection with the Center required for improved clinic
performance, such as work management, materials
management, purchasing, charge and coding analysis, and
business office consultation;
(iii) Obligations of BII under leases or subleases entered
into in connection with the operation of the Center;
(iv) Personal property and intangible taxes assessed
against BII's assets used in connection with the operation
of the Center, commencing on the Effective Date
(hereinafter defined);
(v) Malpractice insurance expenses and Surgeon recruitment
expenses as agreed to by BII and the Entity;
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(vi) Property, casualty and liability insurance for the
Center and its operations;
(vii) In the event an opportunity arises for additional
Surgeons in the Area of Dominant Influence to become
employed by or merge with the Entity, actual out-of-pocket
expenses of BII personnel working on a specified merger,
whether or not such merger is completed if such merger is
approved or requested by the Entity;
(viii) Amortization of intangible asset value as a result
of each such acquisition referred to in subsection (vii)
above;
(ix) Depreciation of all assets used by the Entity in the
operation of the Center;
(x) Repayment of interest on any funds loaned to the
Entity by BII in connection with the operation of the
Center, at an interest rate not in excess of the Prime Rate
plus one percent (1%);
(xi) Advertising and other marketing expenses
attributable to the promotion of the Center and/or its
Surgeon(s); and
(xii) Other expenses incurred by BII with the consent of
the Entity in carrying out its obligations under this
Agreement for the benefit of the Center or the Entity;
provided, however, that such expenses shall not include
BII's home office overhead expenses.
b. "Center Expenses" shall not include:
(i) Any federal or state income taxes; or
(ii) Any personal expenses of the Surgeon as permitted in
the first sentence of Section 3(b) of that certain
employment agreement(s) by and between the Surgeon(s) and
the Entity, in excess of three percent (3%) of the Entity's
Adjusted Gross Revenue.
3.4 Additional Facilities. In the event the parties agree
to add an additional facility in which the Entity or Surgeons will provide
services, the consulting fees payable to BII shall be determined by aggregating
the results of the operations of each additional facility with the results of
the operations of the existing Center or Centers and such fees payable to BII
shall be calculated in accordance with Article III. As part of its strategic
growth strategy, BII may, in its own discretion, provide capital support or
arrange
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favorable funding for surgical practice expansion and development. Any
expenditures on practice growth, acquisition or development shall be subject to
approval by BII's Board of Directors.
IV. INSURANCE AND INDEMNITY
4.1 Insurance to be Maintained by the Entity. Throughout the
term of this Agreement, the Entity shall maintain comprehensive professional
liability insurance with limits of not less than $1,000,000 per claim and with
aggregate policy limits of not less than $3,000,000 per Surgeon providing
services at the Center and a separate limit for the Entity or such other amounts
required by the applicable state laws, regulations, rules or directives. The
Entity shall be responsible for all such liabilities in excess of the limits of
such policies. BII agrees to negotiate for and cause premiums to be paid with
respect to such insurance. Premiums and deductibles with respect to such
policies shall be a Center Expense.
4.2 Insurance to be Maintained by BII. Throughout the term of
this Agreement, BII shall provide and maintain, as a Center Expense,
comprehensive general liability and property insurance covering the Center
premises and operations.
4.3 Tail Insurance Coverage. The Entity shall cause each
individual Surgeon providing services at the Center to enter into an agreement
with the Entity that upon termination of such Entity's relationship with the
Surgeon, for any reason, tail insurance coverage for a period of three (3) years
will be purchased by each Surgeon. Such provisions may be contained in
employment agreements, restrictive covenant agreements or other agreements
entered into by the Entity and the individual Surgeons, and the Entity hereby
covenants with BII to enforce such provisions relating to the tail insurance
coverage or to provide such coverage at the expense of the Entity.
4.4 Additional Insureds. It permitted under applicable law,
the Entity shall have BII named as an additional insured on the Entity's
professional liability insurance programs.
4.5 Indemnification. The Entity shall indemnify, hold harmless
and defend BII, its officers, directors, shareholders, members and employees,
from and against any and all liabilities, losses, damages, claims, causes of
action, and expenses (including reasonable attorneys' fees), whether or not
covered by insurance, caused or asserted to have been caused, directly or
indirectly, by or as a result of the performance of medical services or the
performance of any intentional acts, negligent acts or omissions by the Entity
and/or its affiliates, shareholders, members, agents, employees, surgeons and/or
subcontractors (other than BII) prior to and after the date of this Agreement
and throughout the term hereof. BII shall indemnify, hold harmless and defend
the Entity, and its directors, shareholders, members and employees, from and
against any and all liabilities, losses, damages, claims, causes of action, and
expenses (including reasonable attorneys' fees), caused or asserted to
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have been caused, directly or indirectly, by or as a result of the performance
of any intentional acts, negligent acts or omissions by BII, a BII Affiliate
and/or their members, shareholders, agents, employees and/or subcontractors
(other than the Entity) during the term of this Agreement.
V. TERM AND TERMINATION
5.1 Term of Agreement. This Agreement shall commence on the
date BII closes the sale of $25,000,000 of BII's common stock in an initial
public offering (the "IPO") pursuant to a registration statement on Form S-1
(the "Effective Date"), and shall expire on the twentieth (20th) anniversary
thereof unless earlier terminated pursuant to the terms hereof.
5.2 Termination by the Entity. The Entity may terminate this
Agreement as follows:
a. In the event of the filing of a petition in voluntary
bankruptcy or an assignment for the benefit of creditors by
BII, or upon other action taken or suffered, voluntarily or
involuntarily, under any federal or state law for the benefit
of debtors by BII, except for the filing of a petition in
involuntary bankruptcy against BII which is dismissed within
ninety (90) days thereafter, the Entity may give written
notice of the immediate termination of this Agreement.
b. In the event BII shall materially default in the
performance of any duty or obligation imposed upon it by this
Agreement and such default shall continue for a period of
ninety (90) days after written notice thereof has been given
to BII by the Entity (which notice shall contain specific
details of the reason for such default), the Entity may
terminate this Agreement; provided, however, if the nature of
such default is such that cure is not capable within said
90-day period, then BII shall have such additional time as may
be required to effect and complete such cure provided that BII
shall commence such cure within the aforesaid 90-day period
and shall prosecute such cure to completion with reasonable
diligence.
c. In the event that a "Change in Control" (as herein defined)
occurs with respect to BII, the Entity may, within ten (10)
days after the expiration of the Approval Period (as herein
defined), terminate this Agreement by providing five (5) days
prior written notice to BII. For purposes of this Section,
"Change in Control" means an acquisition or aggregation of any
voting securities of BII by a "person" (as defined in Sections
13(d) and 14(d) of the Securities Exchange Act of 1934)
immediately after which such person is or becomes the
beneficial owner, directly or indirectly, of 15% or more of
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the combined voting power of BII's then outstanding voting
securities; provided, however, that no acquisition or
aggregation of BII's voting securities shall be deemed a
"Change in Control" if such acquisition or aggregation (i) has
the prior approval of BII's board of directors, or (ii) is
approved by BII's board of directors within 60 days after BII
receives notice of such acquisition or aggregation (the
"Approval Period").
5.3 Termination by BII. BII may terminate this Agreement as
follows:
a. In the event of the filing of a petition in voluntary
bankruptcy or an assignment for the benefit of creditors by
the Entity, or upon other action taken or suffered,
voluntarily or involuntarily, under any federal or state law
for the benefit of debtors by the Entity, except for the
filing of an involuntary petition in bankruptcy against the
Entity which is dismissed within thirty (30) days thereafter,
BII may give written notice of the immediate termination of
this Agreement.
b. In the event the Entity shall materially default in the
performance of any duty or obligation imposed upon it by this
Agreement, and such default shall continue for a period of
thirty (30) days after written notice thereof has been given
to the Entity by BII, BII may terminate this Agreement.
5.4 Actions after Termination. Upon termination of this
Agreement by either party for any reason other than a default by the Entity or
upon expiration of this Agreement, the Entity may, and upon termination of this
Agreement by BII due to the reasons set forth in Section 5.3(b) hereof, the
Entity shall:
a. Purchase all improvements, additions or leasehold
improvements which have been made by BII and which relate
solely to the performance of its obligations under this
Agreement at adjusted book value;
b. Assume all debt and all contracts, payables and leases
which are obligations of BII and which relate solely to the
performance of its obligations under this Agreement or the
properties subleased by BII; and
c. Purchase from BII at adjusted book value all of the
equipment of the Center, including all replacements and
additions thereto made by BII pursuant to the performance of
its obligations hereunder, and all other assets, including
inventory and supplies, tangibles and intangibles (including
but not limited to accounts receivable), set forth on the
balance sheet prepared for the month most recently ended prior
to the date of such termination in accordance with GAAP to
reflect operations of the Center, depreciation, amortization
and other adjustments of assets shown on such balance sheet.
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5.5 Closing of Repurchase by the Entity and Effective Date of
Termination. Unless another form of payment is agreed to by BII at such time,
the Entity shall pay cash to BII for (i) the assets repurchased pursuant to
Section 5.4 and (ii) an amount equal to the Consulting Fee that would have been
payable hereunder for services rendered to patients by the Entity prior to the
termination of this Agreement; provided, however, that such cash Consulting Fee
payment shall only be made as payment for such services as are actually
collected by the Entity. The amount of the purchase price shall be reduced by
the amount of debt and liabilities of BII assumed by the Entity and shall also
be reduced by any payment BII has failed to make under this Agreement. The
Entity and any Surgeon associated with the Entity shall execute such documents
as may be required to assume the liabilities set forth in Section 5.4(c) and
shall use its best efforts to remove BII from any liability with respect to such
repurchased assets and with respect to any property leased or subleased by BII.
The closing date for the repurchase shall be determined by the Entity, but shall
in no event occur later than 180 days from the date of the notice of
termination. The termination of this Agreement shall become effective upon the
closing of the sale of the assets and the Entity and BII shall be released from
the restrictive covenants provided for in Section 2.9 on the closing date. From
and after any termination, each party shall provide the other party with
reasonable access to books and records then owned by it to permit such
requesting party to satisfy reporting and contractual obligations which may be
required of it.
5.6 Patient Records. Upon termination of this Agreement, the
Entity shall retain all patient medical records maintained by the Entity or BII
in the name of the Entity. During the term of this Agreement, and thereafter,
the Entity or its designee shall have reasonable access during normal business
hours to the Entity's and BII's records, including, but not limited to, records
of collections, expenses and disbursements as kept by BII in performing BII's
obligations under this Agreement, and the Entity may copy any or all such
records.
VI. INDEPENDENT CONTRACTOR
6.1 Entity's Control Over Medical Services. Notwithstanding
the authority granted to BII herein, BII and the Entity agree that the Surgeons,
personally or through any Medical Employees or agents, shall have complete
control and supervision over the business aspects of the Entity's practice, as
well as the provision of all professional services, including, without
limitation, the selection of a course of treatment for a patient, the procedures
or materials to be used as a part of such course of treatment, and the manner in
which such course of treatment is carried out by the Surgeon(s). The Surgeon(s)
shall have sole authority to direct the business, professional, and ethical
aspects of the surgical practice. BII will have no authority, directly or
indirectly, to perform, and will not perform, any medical function, or to
influence or otherwise interfere with the exercise of the Surgeon(s)
professional judgment. BII may, however, advise the Entity as to the
relationship
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between its performance of surgical functions and the overall administrative and
business functions of its practice.
6.2 Independent Relationship. The Entity and BII intend to act
and perform as independent contractors, and the provisions hereof are not
intended to create any partnership, joint venture, agency or employment
relationship between the parties.
6.3 Other Professionals. No provision of this Agreement is
intended to limit BII's right, authority, or ability under applicable law to
contract with other physicians, or to employ, contract with, or enter into any
partnership or joint venture with any healthcare professional, provided that the
exercise of such right, authority or ability does not contravene the terms of
this Agreement.
6.4 Patient Care. Nothing in this Agreement is intended to
interfere, or shall be construed as interfering, in any way with the
Surgeon(s)'s ability to independently exercise professional and ethical judgment
in the performance of his patient care responsibilities.
VII. GENERAL PROVISIONS
7.1 Assignment. This Agreement shall be assignable by BII to
any person, firm or corporation that controls or is under common control with
BII. This Agreement shall not be assignable by the Entity. Subject to this
provision, this Agreement shall be binding upon the parties hereto, and their
successors and assigns.
7.2 Whole Agreement; Modification. There are no other
agreements or understandings, written or oral, between the parties regarding
this Agreement, the Exhibits and the Schedules, other than as set forth herein.
This Agreement shall not be modified or amended except by a written document
executed by both parties to this Agreement, and such written modification(s)
shall be attached hereto.
7.3 Notices. All notices required or permitted by this
Agreement shall be in writing and shall be addressed as follows:
To Better Image:
Better Image, Inc.
Two Midtown Plaza
Suite 1220
0000 Xxxxxxxxx Xxxxxx, X.X.
Xxxxxxx, Xxxxxxx 00000
Attn: Xxxxxxxx X. Xxxxxxx
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With a copy to:
King & Spalding
000 Xxxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxx 00000-0000
Attn: Xxxx X. Xxxxxx
Telecopier No.: (000) 000-0000
Telephone No.: (000) 000-0000
To the Entity:
or to such other address as either party shall notify the other.
7.4 Waiver of Provisions. Except as otherwise provided in this
Section 7.4, any waiver of any terms and conditions hereof must be in writing,
and signed by the parties hereto. The waiver of any of the terms and conditions
of this Agreement shall not be construed as a waiver of any other terms and
conditions hereof. The parties acknowledge that BII is not authorized or
qualified to engage in any activity which may be construed or deemed to
constitute the practice of medicine.
7.5 Governing Law. The validity, interpretation and
performance of this Agreement shall be governed by and construed in accordance
with the laws of the State of New York. To the extent any act or service
required of BII in this Agreement should be construed or deemed, by any
governmental authority, agency or court to constitute the practice of medicine,
the performance of said act or service by BII shall be deemed waived and forever
unenforceable and the provision of Section 7.12 shall be applicable.
7.6 Events Excusing Performance. Neither party shall be liable
to the other party for failure to perform any of the services required herein in
the event of strikes, lock-outs, calamities, acts of God, unavailability of
supplies or other events over which that party has no control for so long as
such events continue, and for a reasonable period of time thereafter.
7.7 Compliance with Applicable Laws. Both parties shall comply
with all applicable federal, state and local laws, regulations and restrictions
in the conduct of their obligations under this Agreement.
7.8 Severability. In the event that any provision of this
Agreement or the application thereof to any of the parties hereto or any
circumstance in any jurisdiction governing this Agreement shall, to any extent,
be invalid or unenforceable under any applicable statute, regulation or rule of
law, then such provision shall be deemed inoperative
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to the extent that it may conflict herewith and shall be deemed modified to
conform to such statute, regulation or rule of law, and the remainder of this
Agreement and the application of any such invalid or unenforceable provision to
parties, jurisdictions or circumstances other than to whom or to which it is
held invalid or unenforceable shall not be affected thereby nor shall the same
affect the validity or enforceability of any other provision of this Agreement.
7.9 Additional Documents. Each of the parties hereto agrees
to execute any document or documents that may be requested from time to time by
the other party to implement or complete such party's obligations pursuant to
this Agreement.
7.10 Attorneys' Fees. If legal action is commenced by either
party to enforce or defend its rights under this Agreement, the prevailing party
in such action shall be entitled to recover its costs and reasonable attorneys'
fees in addition to any other relief granted.
7.11 Confidentiality. Neither party hereto shall disseminate
or release to any third party any information regarding any provision of this
Agreement, or any financial information regarding the other (past, present or
future) that was obtained by the other in the course of the negotiation of this
Agreement or in the course of the performance of this Agreement, without the
other party's written approval; provided, however, the foregoing shall not apply
to information which is required to be disclosed by law, including federal or
state securities laws, or pursuant to court order.
7.12 Contract Modifications for Prospective Legal Events. In
the event any state or federal laws or regulations, now existing or enacted or
promulgated after the effective date of this Agreement, are interpreted by
judicial decision, a regulatory agency or legal counsel for 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 Entity and BII shall amend this Agreement as
necessary. To the maximum extent possible, any such amendment shall preserve the
underlying economic and financial arrangements between the Entity and BII.
7.13 Remedies Cumulative. No remedy set forth in this
Agreement or otherwise conferred upon or reserved to any party shall be
considered exclusive of any other remedy available to any party, but the same
shall be distinct, separate and cumulative and may be exercised from time to
time as often as occasion may arise or as may be deemed expedient.
7.14 Language Construction. The language in all parts of this
Agreement shall be construed, in all cases, according to the parties' intent and
the parties hereto acknowledge that each party and its counsel have reviewed and
revised this Agreement and that the normal rule of construction to the effect
that any ambiguities are to be resolved against the drafting party shall not be
employed in the interpretation of this Agreement.
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7.15 No Obligation to Third Parties. None of the obligations
and duties of BII or the Entity under this Agreement shall in any way or in any
manner be deemed to create any obligation of BII or of the Entity to, or any
rights in, any person or entity not a party to this Agreement.
7.16 Counterparts. This Agreement may be executed in
counterparts, each of which shall constitute an original and all of which
together shall constitute one and the same Agreement.
7.17 Singular and Plural; Gender. Where the context so
requires or permits, the use of the singular form includes the plural, and the
use of the plural form includes the singular, and the use of any gender includes
any and all genders.
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IN WITNESS WHEREOF, the parties hereto have executed this
Agreement as of the date first written above.
ENTITY:
By:
--------------------------------
Name:
Title:
BII:
BETTER IMAGE, INC.
By:
--------------------------------
Xxxxxxxx X. Xxxxxxx, Chairman
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