EXHIBIT 10.17
INTERIM MANAGEMENT AGREEMENT
by and between
GLOBAL MED TECHNOLOGIES, INC.
a Colorado corporation
and
NATIONAL MEDICAL REVIEW OFFICES, INC.
a Michigan corporation
TABLE OF CONTENTS
PAGE
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AGREEMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1. Preliminary Agreements. . . . . . . . . . . . . . . . . . . . . . 1
1.1 Transfer of DataMed Operations . . . . . . . . . . . . . . . 1
1.2 Completion of Due Diligence. . . . . . . . . . . . . . . . . 2
1.3 Operations Prior to Election . . . . . . . . . . . . . . . . 2
1.4 Operations After Election. . . . . . . . . . . . . . . . . . 2
1.5 Effect of Election Not to Proceed with Acquisition . . . . . 2
2. Representations and Warranties of Company . . . . . . . . . . . . 2
3. Further Representations and Warranties of Company . . . . . . . . 3
4. Representations and Warranties of Manager . . . . . . . . . . . . 3
5. Management of DataMed by Manager. . . . . . . . . . . . . . . . . 4
5.1 Authority of Manager . . . . . . . . . . . . . . . . . . . . 4
5.2 Discharge of Operating Expenses. . . . . . . . . . . . . . . 4
5.3 Non-Assignment of Agreements . . . . . . . . . . . . . . . . 4
5.4 Limitation of Liabilities. . . . . . . . . . . . . . . . . . 5
5.5 Insurance. . . . . . . . . . . . . . . . . . . . . . . . . . 5
5.6 Events Excusing Performance. . . . . . . . . . . . . . . . . 5
5.7 No Limitation on Other Projects. . . . . . . . . . . . . . . 5
6. Compensation to Manager . . . . . . . . . . . . . . . . . . . . . 5
6.1 Revenue Defined. . . . . . . . . . . . . . . . . . . . . . . 5
6.2 Expenses Defined . . . . . . . . . . . . . . . . . . . . . . 6
6.3 Net Income and Net Loss. . . . . . . . . . . . . . . . . . . 6
6.4 Management Fee . . . . . . . . . . . . . . . . . . . . . . . 6
6.5 Net Loss Allocation. . . . . . . . . . . . . . . . . . . . . 6
6.6 Net Loss Reimbursement by Company. . . . . . . . . . . . . . 7
6.7 Assignment of Accounts Receivable. . . . . . . . . . . . . . 7
7. Obligations of Company. . . . . . . . . . . . . . . . . . . . . . 7
7.1 Exclusive Manager. . . . . . . . . . . . . . . . . . . . . . 7
7.2 Assignment of Key Employee . . . . . . . . . . . . . . . . . 8
7.3 Reimbursement Obligations. . . . . . . . . . . . . . . . . . 8
7.4 Insurance. . . . . . . . . . . . . . . . . . . . . . . . . . 8
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7.5 Cooperation and Further Assurances . . . . . . . . . . . . . 8
7.6 Access to Facilities . . . . . . . . . . . . . . . . . . . . 8
7.7 Access to Records. . . . . . . . . . . . . . . . . . . . . . 9
7.8 Adverse Actions. . . . . . . . . . . . . . . . . . . . . . . 9
7.9 Events Excusing Performance. . . . . . . . . . . . . . . . . 9
8. Term and Termination. . . . . . . . . . . . . . . . . . . . . . . 9
8.1 Term of Agreement. . . . . . . . . . . . . . . . . . . . . . 9
8.2 Termination by Company . . . . . . . . . . . . . . . . . . . 9
8.3 Termination by Manager . . . . . . . . . . . . . . . . . . . 10
8.4 Effect of Termination by Manager . . . . . . . . . . . . . . 10
8.5 Non-Solicitation by Manager. . . . . . . . . . . . . . . . . 11
9. General Provisions. . . . . . . . . . . . . . . . . . . . . . . . 11
9.1 Independent Relationship . . . . . . . . . . . . . . . . . . 11
9.2 Assignment . . . . . . . . . . . . . . . . . . . . . . . . . 11
9.3 Resolution of Disputes . . . . . . . . . . . . . . . . . . . 11
9.4 Entire Agreement; Modification . . . . . . . . . . . . . . . 12
9.5 Notices. . . . . . . . . . . . . . . . . . . . . . . . . . . 12
9.6 Binding on Successors. . . . . . . . . . . . . . . . . . . . 12
9.7 Waiver of Provisions . . . . . . . . . . . . . . . . . . . . 12
9.8 Governing Law. . . . . . . . . . . . . . . . . . . . . . . . 12
9.9 Severability . . . . . . . . . . . . . . . . . . . . . . . . 12
9.10 Attorneys' Fees. . . . . . . . . . . . . . . . . . . . . . . 13
9.11 Time is of the Essence . . . . . . . . . . . . . . . . . . . 13
9.12 Confidentiality. . . . . . . . . . . . . . . . . . . . . . . 13
9.13 Remedies Cumulative. . . . . . . . . . . . . . . . . . . . . 13
9.14 Language Construction. . . . . . . . . . . . . . . . . . . . 13
EXHIBIT A. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
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INTERIM MANAGEMENT AGREEMENT
----------------------------
THIS INTERIM MANAGEMENT AGREEMENT ("AGREEMENT"), is made and dated as
of the 7th day of July, 1997, by and between Global Med Technologies, Inc.,
a Colorado corporation ("COMPANY"), and National Medical Review Offices,
Inc., a Michigan corporation ("MANAGER"), with regard to the operation of
DataMed International, a division of the Company ("DATAMED"). Company and
Manager are sometimes referred to herein individually as a "PARTY" or
collectively as the "PARTIES."
WITNESSETH
WHEREAS, the Board of Directors of the Company has determined that it
is in the best interests of the Company, its shareholders and customers, to
divest its interests in DataMed;
WHEREAS, Company and Manager are parties to that certain Letter of
Intent for Proposed Acquisition dated June 20, 1997 (the "LETTER OF
INTENT"), which incorporates by reference the Term Sheet and other terms of
a previous Letter of Intent for Proposed Acquisition dated June 18, 1997;
WHEREAS, the Letter of Intent describes the terms of the proposed
acquisition by Manager from Company of the assets used by Company in the
operation of DataMed (the "ACQUISITION"), which terms include the transfer
of direction and control of the operations of DataMed from Company to
Manager as of June 30, 1997, on an interim basis subject to the final
approval of the Acquisition by the shareholders of Company, and the closing
of the Acquisition in accordance with the terms of mutually acceptable
definitive agreements reflecting the Acquisition (the "PURCHASE
AGREEMENTS"); and
WHEREAS, Manager and Company desire to enter into this Agreement with
the purpose and intent of memorializing their agreements regarding the
terms and conditions for the transfer of direction and control of the
operations of DataMed to Manager on an interim basis, and the related
transactions described herein.
AGREEMENTS
-----------
NOW, THEREFORE, in consideration of the premises and the mutual
covenants of the Parties set forth herein, and of other good and valuable
consideration, the receipt and adequacy of which each Party hereby
acknowledges, the Parties hereto agree as follows:
1. PRELIMINARY AGREEMENTS.
1.1 TRANSFER OF DATAMED OPERATIONS. The operation and control of
DataMed shall be transferred from Company to Manager in accordance with
this Agreement, as of midnight (Mountain Time) on June 30, 1997 (the
"EFFECTIVE DATE").
1.2 COMPLETION OF DUE DILIGENCE. Subject to and in accordance with
the Letter of Intent, Manager agrees to work diligently and in good faith
to complete all of its due diligence investigations of DataMed as soon as
reasonably practical, but in no event later than 5:00 p.m. (Mountain Time)
on Friday, July 11, 1997 (the "DUE DILIGENCE DEADLINE"). Manager agrees to
provide written notice to Company, prior to the Due Diligence Deadline, of
Manager's election to proceed, or not to proceed, with the Acquisition (the
"ELECTION"). Company agrees to cooperate with Manager diligently and in
good faith so as to facilitate the completion by Manager of its due
diligence investigations prior to the Due Diligence Deadline.
1.3 OPERATIONS PRIOR TO ELECTION. During the period beginning on the
Effective Date, and ending on the date upon which Manager makes its
Election, Manager and Company agree to the following: (i) all accounts
payable with regard to DataMed operations shall be frozen, I.E., Company
and Manager agree not to pay or discharge any loans, trade accounts, or
other indebtedness with regard to DataMed operations, except for payments
to physicians who provide medical review officer services to DataMed, and
such other payments as the Parties mutually agree are reasonable and
necessary, which shall be separately identified and recorded by the
Parties; and (ii) all accounts receivable with regard to DataMed operations
shall be frozen, I.E., Company and Manager agree to continue to collect and
hold accounts receivable, but not to sell, assign, transfer, compromise,
write-off or otherwise adjust such accounts receivable.
1.4 OPERATIONS AFTER ELECTION. If Manager's Election is to proceed
with the Acquisition, then after Manager makes such Election, Manager shall
be obligated: to pay and discharge all accounts payable that are Expenses
as defined in Section 6.2, and to xxxx for DataMed services and collect
accounts receivable of the Company relating to the business and operations
of DataMed.
1.5 EFFECT OF ELECTION NOT TO PROCEED WITH ACQUISITION. If Manager
elects not to proceed with the Acquisition, then this Agreement will
terminate as of the date of such Election, and the obligations of Company
and Manager, respectively, shall be governed by Section 8 of this
Agreement.
2. REPRESENTATIONS AND WARRANTIES OF COMPANY. Company hereby covenants,
represents, and warrants as follows:
2.1 Company is a corporation duly organized, validly existing and in
good standing under the laws of the State of Colorado.
2.2 Company has full legal power and authority to enter into and
deliver this Agreement and perform the transactions contemplated herein.
2.3 All consents, approvals, resolutions, authorizations, actions or
orders required of Company for the authorization, execution and delivery
of, and for the consummation of the transactions contemplated by, this
Agreement have been obtained, except if and to the extent that the approval
of the shareholders of Company is required.
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2.4 This Agreement when executed and delivered will constitute
Company's legal, valid and binding obligation enforceable in accordance
with its terms.
2.5 The execution and delivery of this Agreement, and the fulfillment
of and compliance with the terms and provisions hereof do not conflict with
or violate any judicial or administrative order, award, judgment or decree
applicable to Company, or violate or conflict with any of the terms,
conditions or provisions of Company's Articles of Incorporation, Bylaws, or
other organizational documents or any contract between Company and any
third person or entity (whether with or without notice or passage of time).
3. FURTHER REPRESENTATIONS AND WARRANTIES OF COMPANY. Company covenants,
represents, and warrants that as follows:
3.1 Company has sole and complete ownership or lawful control over
the property and facilities used by Company in the operation of DataMed.
3.2 Company has operated its property and facilities, and as of the
commencement of this Agreement will be, in substantial compliance with all
applicable federal, state and local laws, rules and regulations any
violation of which could have a material adverse impact on DataMed, its
operations, financial condition, or its business prospects.
3.3 Company shall have sole and absolute responsibility for and shall
pay when and as due, any and all income taxes imposed on Company.
4. REPRESENTATIONS AND WARRANTIES OF MANAGER. Manager hereby covenants,
represents, and warrants as follows:
4.1 Manager is a corporation duly organized, validly existing and in
good standing under the laws of the State of Michigan.
4.2 Manager has full legal power and authority to enter into and
deliver this Agreement and perform the transactions contemplated herein.
4.3 All consents, approvals, resolutions, authorizations, actions or
orders required of Manager for the authorization, execution and delivery
of, and for the consummation of the transactions contemplated by, this
Agreement have been obtained.
4.4 This Agreement when executed and delivered will constitute
Manager's legal, valid and binding obligation enforceable in accordance
with its terms.
4.5 The execution and delivery of this Agreement, and the fulfillment
of and compliance with the terms and provisions hereof do not conflict with
or violate any judicial or administrative order, award, judgment or decree
applicable to Manager, or violate or conflict with any of the terms,
conditions or provisions of Manager's Articles of Incorporation, Bylaws, or
other organizational documents or any contract between Manager and any
third person or entity (whether with or without notice or passage of time).
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5. MANAGEMENT OF DATAMED BY MANAGER.
5.1 AUTHORITY OF MANAGER. Subject to the covenants, conditions and
restrictions set forth in this Agreement, and subject to existing
contractual obligations of the Company, Manager shall have and Company
hereby delegates to Manager, sole and exclusive responsibility, authority
and discretion to conduct, manage, direct and control all aspects of the
business and operations of DataMed. Without limiting the generality of the
foregoing, Manager shall have the following authorities and
responsibilities:
(a) to conduct, manage, direct and control all aspects of the
business and operations of DataMed, in the exercise of Manager's good faith
business judgment, consistent with applicable laws, and without any
obligation to seek or obtain from Company its advice, recommendation,
concurrence or consent;
(b) effective after the Due Diligence Deadline, to conduct,
manage, direct and control the transition of the ownership of DataMed,
including without limitation, (i) the sale, assignment, or other
disposition or transfer of any or all of the assets or contractual
obligations of DataMed, (ii) the reduction of DataMed's employee or other
work force, and (iii) the assignment or transfer of DataMed's
administrative responsibilities;
(c) to administer Company's contracts with customers, service
providers, and other vendors or purchasers of services or supplies,
including the authority and responsibility to negotiate, enter into,
maintain, amend, any or all of such contracts, provided, however, that
Manager shall not terminate any contract with any DataMed customer, or any
service provided to any DataMed customer, without the prior consent of
Company, which consent Company agrees not to unreasonably withhold or
delay;
(d) to xxxx for DataMed services and collect accounts receivable
of the Company relating to the business and operations of DataMed;
(e) effective after the Due Diligence Deadline, to fix and to
change the location of the offices used by Company for the transaction of
DataMed business, and to locate or relocate from time to time such offices
within or outside of the State of Colorado; and
(f) to rely on information, opinions, reports or statements,
including financial statements and other financial data and records,
prepared or presented to Manager by Company, its officers, agents or
employees, at any time prior to or during the term of this Agreement.
5.2 DISCHARGE OF OPERATING EXPENSES. Subject to the covenants,
conditions and restrictions set forth in this Agreement, Manager agrees to
pay and discharge all Expenses, as defined in Section 6.2 below, incurred
by Manager in the operation of DataMed.
5.3 NON-ASSIGNMENT OF AGREEMENTS. Notwithstanding Manager's
obligation under Section 5.2 above, nothing in this Agreement is intended
to be or shall be construed to
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constitute an assignment by Company of any agreement or contractual
obligation, whether express or implied, that exists between Company and any
other person or entity. Similarly, nothing in this Agreement is intended
to be or shall be construed to constitute an assumption by Manager of any
agreement or contractual obligation, whether express or implied, that
exists between Company and any other person or entity. The Parties
acknowledge and agree that agreements and contractual obligations of
Company cannot be assigned by Company or assumed by Manager except with the
approval of the Company shareholders to the Acquisition and the Purchase
Agreements.
5.4 LIMITATION OF LIABILITIES. Manager makes no warranties, express
or implied, as to the following: the results of operation of DataMed;
any actions that will or will not be taken by Manager in the operation of
DataMed; any services or supplies that will or will not be provided by
DataMed; any customers or clients that will or will not be retained or
acquired by DataMed; or any net book value, net worth, liquidation value,
or any other value of DataMed or any of its assets upon termination of this
Agreement. Except for any Net Loss that is allocable to Manager in
accordance with Section 6.5 of this Agreement, in no event will Manager be
liable to Company, or any person or entity engaged by or under contract
with Company, for any losses, liabilities, or damages, including, without
limitation, any lost profits, lost savings, or other incidental, special or
consequential damages, incurred by Company, its agents or employees, as a
result of Manager's operation of DataMed in the exercise of Manager's good
faith business judgment, even if Manager has been advised of the
possibility of such damages, except for any such damages or liability
caused by the unlawful conduct or negligence, of Manager, or its agents and
employees.
5.5 INSURANCE. Throughout the term of this Agreement, Manager shall
provide and maintain comprehensive general liability, workers compensation,
and professional liability insurance for all employees of Manager (but not
Company employees), with such limits as the Parties agree are commercially
reasonable.
5.6 EVENTS EXCUSING PERFORMANCE. Manager shall not be liable to
Company for failure to perform any of the services required herein in the
event of any strike, lock-out, calamity, act of God, unavailability of
supplies or other event over which Manager has no control, for so long as
such event continues, and for a reasonable period of time thereafter.
5.7 NO LIMITATION ON OTHER PROJECTS. Nothing contained in this
Agreement shall preclude, limit or otherwise affect the right of Manager to
engage in, or possess interests in, other business ventures of every kind
and description.
6. COMPENSATION TO MANAGER
6.1 REVENUE DEFINED. For purposes of this Agreement, "REVENUE" shall
mean and include: (i) all fees and payments to which Company becomes
entitled, either during the term of this Agreement or following termination
or expiration thereof, for or in connection with, the provision of services
or supplies by DataMed, regardless of where such services or supplies are
rendered, or what method of payment is used; and (ii) all investment
income, proceeds of sale of assets, and other income collected by or on
behalf of DataMed during the
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term of this Agreement. Revenue shall be determined on an accrual basis in
accordance with generally accepted accounting principles consistently
applied.
6.2 EXPENSES DEFINED.
(a) For purposes of this Agreement, "EXPENSES" shall mean and
include all expenses that: (i) were fully disclosed and recorded on the
June 30, 1997, balance sheet and the profit and loss statement of DataMed,
copies of which shall be attached to this Agreement as Exhibit A; (ii) are
necessary and appropriate and incurred in the ordinary course of the
operation of DataMed during the term of this Agreement and after the
Effective Date; (iii) are not otherwise insured or subject to reimbursement
or indemnity from a third party; and are not excluded by Section 6.2(b)
below.
(b) For purposes of this Agreement, "EXPENSES" shall not include
any expenses for: (i) borrowed money or interest charges thereon,
including any intercompany loans (but not including capital leases or
similar equipment financing arrangements with third parties); (ii) legal,
accounting and other consulting expenses incurred by Company; (iii) real
property taxes, or taxes based on income or revenue of the Company; (iv)
expenses associated with the purchase and maintenance of insurance (other
than employee health insurance for employees providing services exclusively
to DataMed); (v) any judgments, settlements, and expenses of litigation
(except for such legal actions as may be initiated by Manager to collect
DataMed accounts receivable); (vi) bank charges on any Company accounts or
transactions; (vii) DataMed employee bonuses or compensation increases not
disclosed and recorded in the June 30, 1997, profit and loss statement of
DataMed; (viii) compensation and benefits paid to Company employees whose
services are not rendered exclusively to DataMed; (ix) intercompany charges
for, or allocations of, overhead and support, and intercompany loans, as
mutually agreed by the Parties; and (x) any expenses paid by Company
relating to DataMed operations that are not disclosed and recorded in the
June 30, 1997 profit and loss statement of DataMed. All expenses described
in this Section 6.2(b) shall be the sole and complete responsibility of
Company.
(c) Expenses shall be determined on an accrual basis in
accordance with generally accepted accounting principles consistently
applied.
6.3 NET INCOME AND NET LOSS. For purposes of this Agreement, "NET
INCOME" of DataMed shall mean the amount by which Revenue exceeds Expenses
for the applicable period and "NET LOSS" shall mean the amount by which
Expenses exceed Revenue for the applicable period. Net Income and Net Loss
shall be determined on an accrual basis in accordance with generally
accepted accounting principles consistently applied.
6.4 MANAGEMENT FEE. In consideration for performing its obligations
under this Agreement, Company shall pay to Manager a monthly management fee
in an amount equal to the Net Income, if any, during the applicable month
(the "MANAGEMENT FEE").
6.5 NET LOSS ALLOCATION. Based upon DataMed's previous financial
performance, Company and Manager anticipate that the operation of DataMed
during the term of this
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Agreement will result in a Net Loss. Accordingly, the Parties agree that
any Net Loss resulting from the operation of DataMed in accordance with
this Agreement shall be allocated between the Parties as follows: (i) if
Company shareholders approve the Acquisition within the time and in the
manner required by the Purchase Agreements, and this Agreement is in full
force and effect, and no event has occurred which with the giving of notice
or the passage of time would constitute a breach by Company of any of its
obligations under this Agreement, then any Net Loss incurred hereunder by
Manager shall be the sole responsibility of Manager; and (ii) if Company
shareholders do not approve the Acquisition within the time and in the
manner required by the Purchase Agreements, or if this Agreement has been
terminated in accordance with Section 8.3 below, or if an event has
occurred which with the giving of notice or the passage of time would
constitute a breach by Company of any of its obligations under this
Agreement, then any Net Loss incurred hereunder in the operation of DataMed
shall be the sole responsibility of Company.
6.6 NET LOSS REIMBURSEMENT BY COMPANY. If Company is obligated to
reimburse Manager for Net Losses in accordance with Section 6.5, then
Company agrees to pay to Manager the total amount of such Net Loss in
accordance with the following: (i) within five (5) business days following
Manager's delivery to Company of a written statement showing the total
amount of such Net Loss (the "Net Loss Statement"), Company shall have the
right, at its sole expense, to have the Net Loss Statement reviewed and
verified by Ernst & Young; (ii) any such review and verification by Ernst
& Young must be completed within thirty (30) days of Company's receipt of
the Net Loss Statement from Manager, and a written report of such review
and verification shall be provided by Ernst & Young to Manager concurrently
with the provision of such report to Company; (iii) if Ernst & Young
concludes that any portion of the Net Loss Statement is inaccurate, then
Company agrees to immediately pay to Manager that portion of Net Loss that
is not in dispute, and to resolve the disputed portion in accordance with
Section 9.3 below.
6.7 ASSIGNMENT OF ACCOUNTS RECEIVABLE. Effective as of the Due
Diligence Deadline, Company hereby assigns (or reassigns, as the case may
be), exclusively to Manager all accounts receivable of DataMed, and all
claims, demands and rights of Company to charge, xxxx and collect from
third parties for services and supplies rendered by DataMed. Company
agrees to execute any and all documents necessary to secure and perfect
Manager's interest in such accounts receivable and revenue, and agrees to
cooperate with Manager in any reasonable manner to effectuate an efficient
billing process and to obtain maximum allowable collection consistent with
the services provided. All payments received by DataMed directly, shall be
promptly delivered to Manager. Company further agrees and hereby appoints
Manager, for the term hereof, to be its true and lawful attorney-in-fact
for purposes of (a) billing and collecting in the name of DataMed; and (b)
receiving, taking possession of and endorsing in the name of DataMed any
notes, checks, money orders, insurance payments and other instruments
received in payment of accounts receivable.
7. OBLIGATIONS OF COMPANY
7.1 EXCLUSIVE MANAGER. During the term of this Agreement and except
as otherwise provided herein, Company engages Manager to act as the sole
and exclusive
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manager and administrator of the business and operations of DataMed.
Manager is expressly authorized by Company to perform its services
hereunder in whatever manner it deems appropriate to meet the day-to-day
requirements of the operations of DataMed, in accordance with standards
established by Manager, including, without limitation, performance of some
of the business functions at other locations. Company further agrees that
during the term of this Agreement, Company shall not, without the prior
written consent of Manager, contract for or otherwise purchase or provide
any of the management, administrative or other services, supplies or
equipment provided by Manager to Company hereunder.
7.2 ASSIGNMENT OF KEY EMPLOYEE. Upon execution of this Agreement by
both Parties, Company agrees to assign Xxxx Xxxxxx to provide services on
behalf of DataMed, on the following terms: (i) Xx. Xxxxxx shall not be
required to allocate more than eight (8) hours per week of his time to
Company during the term of this Agreement; (ii) Xx. Xxxxxx shall not be
required to travel for the Company during the term of this Agreement more
than two (2) trips, and each trip may last not more than three (3) days in
duration; (iii) scheduling of Xx. Xxxxxx' time shall be by mutual agreement
of the Parties; (iv) Company agrees to reimburse Manager for the Company's
pro-rata share of salary and benefits paid by Manager to Xx. Xxxxxx; and
(v) such other terms as the Parties may mutually agree.
7.3 REIMBURSEMENT OBLIGATIONS. Company agrees to perform its
reimbursement obligations under Section 6 above.
7.4 INSURANCE. During the term of this Agreement, Company agrees to
obtain and maintain commercial general liability insurance covering the
operations of DataMed, and fire and extended casualty insurance covering
the offices and property of DataMed, upon such terms and with such
coverages as the Parties agree are commercially reasonable. Upon request
of Manager, Company shall provide evidence of such insurance coverage
required hereunder. The Parties agree that premiums for the foregoing
insurance shall be included in Expenses as defined in Section 6.2(a), and
that Manager shall reimburse Company for such Expenses in accordance with
this Agreement.
7.5 COOPERATION AND FURTHER ASSURANCES. Company agrees to cooperate
with Manager, and to execute such other documents and take such other
actions as may be reasonably necessary or desirable, in connection with the
efficient management of the day-to-day operations of DataMed by Manager,
including, without limitation, the addition of Manager and its designated
employee or employees as an authorized signatory or signatories on any and
all bank or depository accounts used by Company in connection with the
operation of DataMed, including the right to make deposits and cash
withdrawals from such accounts when and as required to pay for obligations
arising in connection with the operation of DataMed as required by this
Agreement, and to pay Manager any amounts due to Manager under Section 6 of
this Agreement.
7.6 ACCESS TO FACILITIES. During the term of this Agreement, Manager
shall have the right to enter and use all DataMed offices and facilities at
all times necessary, in the discretion of Manager, to perform its duties
under this Agreement, including, but not limited to, the right for Manager
employees, contractors and agents, and any equipment, inventory
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or other supplies or documents owned or leased by Manager, to be in such
offices and facilities.
7.7 ACCESS TO RECORDS. During the term of this Agreement, and for a
period of one (1) year thereafter, Manager, and its respective designees,
shall have the right during Company's normal business hours and upon
reasonable prior notice, to inspect, copy and make extracts from, DataMed's
books of account and records, and the Company's books of account and
records relating to the operations of DataMed and maintained by Company
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 the Company'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 Manager's rights or the performance of its duties hereunder.
7.8 ADVERSE ACTIONS. Except as otherwise permitted in this
Agreement, Company agrees not to take any action or implement any decision
that would have a material adverse effect on Manager's authority and
discretion to conduct, manage, direct and control all aspects of the
business and operations of DataMed, or the amount of Manager's Management
Fee, or that otherwise would have a material adverse effect on Manager's
financial interests under this Agreement, unless Company obtains the prior
written approval of Manager to such action or decision.
7.9 EVENTS EXCUSING PERFORMANCE. Company shall not be liable to
Manager for failure to perform any of the services required herein in the
event of any strike, lock-out, calamity, act of God, unavailability of
supplies or other event over which Company has no control, for so long as
such event continues, and for a reasonable period of time thereafter.
8. TERM AND TERMINATION
8.1 TERM OF AGREEMENT. The term of this Agreement shall commence as
of July 1, 1997, and shall extend until the closing of the Acquisition in
accordance with the Purchase Agreements, unless earlier terminated pursuant
to the terms of Sections 8.2 or 8.3 below, or pursuant to mutual agreement
of the Parties or any other provision of this Agreement.
8.2 TERMINATION BY COMPANY. Company may terminate this Agreement
under the following circumstances:
(a) The commencement of any voluntary proceeding by Manager
under any reorganization arrangement, readjustment, moratorium law or
statute, including without limitation, the United States Bankruptcy Code or
any successor federal statute, or if any involuntary proceeding under any
reorganization arrangement, readjustment, moratorium law or statute,
including without limitation the United States Bankruptcy Code or any
successor federal statute, is commenced against Manager, or if Manager
makes, negotiates or commences negotiations for partial or complete
assignment of its assets for the benefit of creditors, pursuant to
statutory or common law;
9
(b) Manager suffers an appointment of a receiver, custodian,
examiner or a trustee for any of its property or assets;
(c) The termination, liquidation or dissolution of Manager;
(d) In the event that Manager shall default in the performance
of any material 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 Manager by Company; or
(e) in the event that Company shareholders do not approve the
Acquisition within the time and in the manner required by the Purchase
Agreements.
8.3 TERMINATION BY MANAGER. Manager may terminate this Agreement
under the following circumstances:
(a) the commencement of any voluntary proceeding by Company
under any reorganization arrangement, readjustment, moratorium law or
statute, including without limitation, the United States Bankruptcy Code or
any successor federal statute, or if any involuntary proceeding under any
reorganization arrangement, readjustment, moratorium law or statute,
including without limitation the United States Bankruptcy Code or any
successor federal statute, is commenced against Company; or if Company
makes, negotiates or commences negotiations for partial or complete
assignment of its assets for the benefit of creditors, pursuant to
statutory or common law;
(b) Company suffers an appointment of a receiver, custodian,
examiner or a trustee for any of its property or assets;
(c) the termination, liquidation or dissolution of Company,
except any such action that causes a third party to expressly assume the
obligations and succeed to the interests of Company hereunder;
(d) in the event that Manager makes, prior to the Due Diligence
Deadline, the written Election not to proceed with the Acquisition;
(e) in the event that Company shareholders do not approve the
Acquisition within the time and in the manner required by the Purchase
Agreements; or
(f) in the event Company shall default in the performance of any
material 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 Company.
8.4 EFFECT OF TERMINATION BY MANAGER. If Manager terminates this
Agreement pursuant to Section 8.3, then in addition to any other right or
remedies to which Manager may be entitled hereunder, or by law, Company
will retain all rights (including rights to accounts receivable of
DataMed), and all obligations and liabilities (including accounts
10
payable) relating to the operation of DataMed, and Company will reimburse
Manager's Expenses.
8.5 NON-SOLICITATION BY MANAGER. Manager agrees for a period of two
(2) years following the termination of this Agreement, not to directly
solicit any persons who are employees of DataMed as of the date of such
termination. Manager further agrees for a period of one (1) year following
the termination of this Agreement, not to directly solicit any persons or
entities who are customers of DataMed as of the date of such termination,
provided, however, that the foregoing shall not restrict Manager from
soliciting any former customer of DataMed, or from responding to any
existing customer of DataMed that has generally submitted a request for
proposal to any persons or entities other than DataMed.
9. GENERAL PROVISIONS
9.1 INDEPENDENT RELATIONSHIP. The Parties to this Agreement shall be
and remain independent legal entities, without obligation to each other or
to any third person or entity, except as may be expressly set forth in this
Agreement. The Parties do not intend this Agreement, or any aspect of the
operation of DataMed, to form a partnership, joint venture, or any other
form of legal association under any California or Colorado law. The
Parties to this Agreement do not intend to be partners to one another, or
partners as to any third person or entity not a Party to this Agreement.
Except as otherwise expressly set forth in this Agreement, or as otherwise
may be required by applicable law, no Party shall be held to be a fiduciary
or trustee, or to have any fiduciary obligation, to any other Party.
9.2 ASSIGNMENT. Either Party shall have the right to assign its
rights and delegate its duties hereunder, without the prior consent of the
other Party.
9.3 RESOLUTION OF DISPUTES. In the event of any controversy, claim
or dispute between any Parties arising out of or relating to this
Agreement, or the making, performance or interpretation of it (the
"Dispute"), the Parties agree to comply diligently and in good faith with
the following procedure in order to resolve the Dispute:
(a) A meeting (the "Initial Meeting") shall promptly be held at
which all Parties are present or represented by individuals with full
decision making authority regarding the Dispute. If within thirty (30)
days following the Initial Meeting the Parties have not succeeded in
negotiating a resolution of the Dispute, the Dispute shall be submitted to
mediation facilitated by a mediator ("Mediator"). Such Mediator shall be
a retired judge or mature practicing attorney. Each Party shall bear its
proportionate share of the costs of the mediation, including the Mediator's
fee. The Parties agree to participate in good faith in the mediation and
negotiations related thereto and in all mediation conferences.
(b) If within a period of thirty (30) days following the final
adjournment of the mediation conference(s), the Parties are unable to
resolve the Dispute, the Dispute shall be settled by binding arbitration in
accordance with the Commercial Arbitration Rules of the American
Arbitration Association then existing, including, but not limited to, the
Commercial Arbitration Rules relating to selection of arbitrators and the
place of arbitration.
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Arbitrators will be persons experienced in negotiating, making, and
consummating acquisition agreements. Judgment upon the arbitration award
may be entered in any court having jurisdiction over the subject matter of
the controversy.
9.4 ENTIRE AGREEMENT; MODIFICATION. There are no other agreements or
understandings, written or oral, between the parties regarding the subject
matter of this Agreement, other than as set forth herein. All Exhibits
referred to in this Agreement are intended to and shall be incorporated
into this Agreement by reference and shall be deemed to be a part of this
Agreement. This Agreement shall not be modified or amended except by a
written document executed by both Parties. Each written modification shall
be attached hereto.
9.5 NOTICES. All notices required, desired or permitted to be given
under this Agreement shall be in writing and shall be deemed to have been
duly made and given when given in person, by nationally recognized
overnight courier, or when sent by United States mail, postage prepaid,
registered or certified mail, return receipt requested, or by overnight
delivery addressed as follows:
If to Manager: National Medical Review Offices, Inc.
0000 Xxxxxxxx Xxxxxxxxx, Xxxxx 000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: President
If to Company: Global Med Technologies, Inc.
00000 Xxxx Xxxxxx, Xxxxx X-000
Xxxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxxx X. Xxxxx,
Chief Executive Officer
Any such notice sent by United States mail shall be deemed to have been
given forty-eight (48) hours after posting (if addressed and prepaid as set
forth above) and notices which are personally delivered or delivered by
overnight delivery shall be deemed to have been given when delivered. Each
Party may change the address to which its notices are to be delivered
hereunder, by giving notice as hereinabove provided.
9.6 BINDING ON SUCCESSORS. Subject to Section 9.1, this Agreement
shall be binding upon the Parties, and the Parties' respective successors,
assigns, heirs and beneficiaries.
9.7 WAIVER OF PROVISIONS. Any waiver of any term or provision hereof
must be made in writing, and signed by the Parties hereto. Any such waiver
shall not be construed as a waiver of any other term or provision hereof,
not expressly provided for a written waiver signed by the Parties.
9.8 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 Colorado.
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9.9 SEVERABILITY. The provisions of this Agreement shall be deemed
severable and if any provision hereof shall be held invalid, illegal or
unenforceable for any reason, the remainder of this Agreement shall be and
remain effective and binding upon the Parties, and Company.
9.10 ATTORNEYS' FEES. If legal action is commenced by either Party to
enforce or defend its rights under this Agreement, or to interpret or
enforce this Agreement, the prevailing Party in such action shall be
entitled to recover its costs and reasonable attorneys' fees from the other
Party, in addition to any other relief granted.
9.11 TIME IS OF THE ESSENCE. Time is hereby expressly declared to be
of the essence in this Agreement.
9.12 CONFIDENTIALITY. Except for disclosure to its attorneys and
consultants, or as necessary for the conduct of its business, neither Party
shall disclose to any third party (other than Company) any provision of
this Agreement, or any financial or other information regarding the other
Party obtained by disclosing Party, regardless of when obtained, without
the prior written consent of the other Party.
9.13 REMEDIES CUMULATIVE. No remedy set forth in this Agreement or
otherwise conferred upon or reserved to any Party by law, shall be
considered exclusive of any other remedy available to such Party.
9.14 LANGUAGE CONSTRUCTION. The language in all parts of this
Agreement shall be construed, in all cases, according to its fair meaning,
and not for or against either Party.
IN WITNESS WHEREOF, the Parties hereto have executed this Agreement as
of the date first written above.
"Company" "Manager"
GLOBAL MED TECHNOLOGIES, INC. NATIONAL MEDICAL
a Colorado corporation REVIEW OFFICES, INC.
a Michigan corporation
By: /s/ XXXXXXX X. XXXXX By: /s/ XXXXX XXXXXX
---------------------------- ---------------------------
Its: CEO Its: COO
---------------------------- ---------------------------
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EXHIBIT A
June 30, 1997
Balance Sheet and Profit and Loss Statement
