EXHIBIT 10.35
FORM OF XXXXX/NEWCO AGREEMENT
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This Xxxxx/NewCo Agreement (the "Agreement") is made and entered into as of
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____ , 1999 (the "Effective Date") by and among Xxxxx HealthSystem Medical,
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Inc., a Delaware corporation ("Xxxxx"), Tendex, Inc., a Delaware corporation
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("NewCo"), Xxxxxxxx.xxx, Inc., a Delaware corporation ("Promedix"), and Chemdex
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Corporation, a Delaware corporation ("Chemdex").
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BACKGROUND
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Xxxxx and Chemdex have entered into a joint venture agreement to create
NewCo for the purpose of providing a WWW (defined below) marketplace for the
sale of commodity healthcare products. Xxxxx operates a group purchasing
program which negotiates group purchasing prices and terms for the benefit of
both Xxxxx-owned and non-Xxxxx-owned health care providers. Promedix operates a
platform for researching and obtaining specialty medical products. The parties
desire to set forth the terms and conditions under which Xxxxx'x group
purchasing members will purchase products from Xxxxx'x group purchasing
suppliers and distributors via NewCo's online platform. In addition, the
parties desire to set forth the terms and conditions under which Promedix will
provide certain integration and training services to Xxxxx organizations, in
consideration for which members of Xxxxx'x group purchasing organization will
purchase certain products from Promedix.
AGREEMENT
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In consideration of the agreements contained herein, the parties agree as
follows:
1. Definitions.
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"Administrative Fees" means the administrative fees and discounts
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which Xxxxx receives from Xxxxx Suppliers for products purchased from such Xxxxx
Suppliers by Members.
"Confidential Information" of a party means any information disclosed
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by that party to another party pursuant to this Agreement, and which the
disclosing party does not specifically identify in writing as non-confidential
to the receiving party, including, but not limited to, that which relates to
patents, patent applications, research, product plans, products, developments,
inventions, processes, designs, drawings, engineering, formulae, markets,
software (including source and object code), hardware configuration, computer
programs, algorithms, regulatory information, medical reports, clinical data and
analysis, business plans, agreements with third parties, services, customers,
marketing or finances of the disclosing party.
"Cost" means the fully loaded cost of providing a service, product, or
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technology, taking into account such factors as (a) labor, travel, insurance,
benefits, tax, and training expenses for consultants and employees, (b) overhead
allocations (including, without limitation, rent, lease, equipment, and related
infrastructure expenses), and (c) other factors mutually agreed upon by the
parties.
"Exclusive Field of Use" means developing, hosting, and commercially
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exploiting a WWW-based system for the sale of healthcare products to any
healthcare group purchasing organization or purchasing aggregator, hospital,
multi-hospital system or network, long-term care facility, retail pharmacy,
physician office, outpatient clinic, or drug and chemical dependency center.
* Confidential Treatment Requested. Bolded and Bracketed portions have been
ommitted and have been filed separately with the SEC.
"Intellectual Property Rights" means all of the following: (a)
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patents, patent applications and related patent rights, including but not
limited to divisions, continuations, continuations in-part, renewals, reissues
and extensions thereof; (b) rights associated with works of authorship including
moral rights, copyrights, registrations and applications therefor, mask work
rights, mask work applications and mask work registrations; (c) rights relating
to the protection of trade secrets and confidential information; and (d) rights
relating to the protection of trademarks or trade names.
"Member" means a health care provider for which Xxxxx acts as an agent
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to negotiate terms of purchase for healthcare products from Xxxxx Suppliers. A
list of Members as of the Effective Date shall be provided separately to all
parties.
"Milestone Completion Date" means the date, with respect to each
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Member, on which Promedix has completed the integration services which Promedix
agrees to provide to each such Member in accordance with Section 3(a) below.
"NewCo Marketplace" means NewCo's WWW platform (including, without
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limitation, buyer and supplier applications) for the sale of Routine Products.
"Non-Xxxxx Participant" means a Member which is not a Xxxxx
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Participant.
"Promedix Commerce Site" means Promedix's WWW platform for the sale of
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Promedix Products.
"Promedix Products" means healthcare products (a) which are not
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Routine Products or (b) are products from contracted suppliers that choose to
use Promedix's services.
"Routine Products" means healthcare products which are (a) stock or
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(b) that Xxxxx has under contract.
"Services" means the services Promedix provides pursuant to Exhibit B.
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"Supplier Agreement" means an agreement between Xxxxx and Xxxxx
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Suppliers for the sale of healthcare products to Members.
"Xxxxx GPO" means Xxxxx'x group purchasing program which negotiates
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group purchasing agreements for prices and terms for the benefit of Members.
"Xxxxx Participant" means a Member owned, operated, leased, or managed
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by Xxxxx, Xxxxx'x parent company, or one of its subsidiary companies.
"Xxxxx Supplier" means a supplier or distributor which agrees to
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provide products and services to Members.
"WWW" means the World Wide Web.
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2. Xxxxx GPO Fees and Administration.
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(a) Assignment of Administrative Fees. After the NewCo Marketplace is
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commercially available, and in consideration for the provision of such NewCo
Marketplace by NewCo, Xxxxx will assign to NewCo one hundred percent (100%) of
the Administrative Fees earned by Xxxxx
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from vendors and distributors, under the terms and conditions of its Supplier
Agreements with such distributors and vendors, with respect to all transactions
conducted through the NewCo Marketplace. After receiving such Administrative
Fees, NewCo shall pay to each Member the percentage of the Administrative Fee,
if any, due to such Member in accordance with the Member agreement in effect
between Xxxxx and such Member. Xxxxx shall provide NewCo with a list of all
Xxxxx Suppliers as of the Effective Date, as well as the Administrative Fees
which Xxxxx receives from such Xxxxx Suppliers, within thirty (30) days after
the Effective Date. In addition, Xxxxx shall provide NewCo with a list of all
Members as of the Effective Date, as well as the percentage of the
Administrative Fee due to such Member, within thirty (30) days after the
Effective Date. Xxxxx shall notify NewCo in writing of any changes to such lists
on the first day of each calendar month during the term of this Agreement. Xxxxx
warrants and represents that is has the right to assign the Administrative Fees
to NewCo as set forth hereunder, and that such assignment, and the payment by
NewCo of Administrative Fees to Members, will not breach Xxxxx'x agreements with
its Members or Suppliers.
(b) Reports. Within thirty (30) days after the end of each month,
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NewCo will send a report to Xxxxx which sets forth (a) the aggregate purchases
of each Member through the NewCo Marketplace during such month and (b) the
Administrative Fees which accrued to NewCo during such month, calculated in
accordance with the rates set forth in the lists provided to NewCo by Xxxxx in
accordance with Section 2(a) above.
(c) Administration. NewCo will provide certain administrative
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services to Xxxxx in connection with the Xxxxx GPO as set forth on Exhibit A
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hereto.
3. Promedix Obligations to Xxxxx. Promedix will use commercially
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reasonable efforts to (a) provide integration services to Members as set forth
on Exhibit B hereto and (b) provide education and training programs to Members
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as set forth on Exhibit B hereto.
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4. Purchases through Promedix Commerce Site.
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(a) Payments for Services. Xxxxx will pay all Costs which Promedix
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reasonably incurs in providing Services to Xxxxx Participants hereunder.
(b) Exclusive Supplier. Subject to the provisions of this Section
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4(b), Xxxxx will ensure that, after the Milestone Completion Date applicable to
each Member, such Member will purchase its Promedix Product requirements
(provided such products are offered for sale through the Promedix Commerce Site)
exclusively through the Promedix Commerce Site. Notwithstanding the foregoing:
(i) any Member will not be obligated to purchase its Promedix
Product requirements through the Promedix Commerce Site and will have the
right to purchase its Promedix Product requirements from third parties
after the applicable Milestone Completion Date if such Member can obtain
such products at lower prices through such third party supplier; and
(ii) Promedix acknowledges that Xxxxx is currently under
agreements with distributors for healthcare products. In the event of a
product source conflict between Promedix and one of these distributors over
a product currently available through such distributors, then Xxxxx
reserves the right to select the source for the term of those existing
agreements.
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This Agreement is not contemplated to change Xxxxx'x traditional business
practices through existing distributors including with respect to extensions or
renewals or future contracts, or require that Xxxxx breach any of its current
distributor agreements. However, Xxxxx agrees that it will not add to its
contracts with distribution-contracted vendors, companies or products that
compete with Promedix.
The provisions of this Section 4(b) shall remain in effect for a period of
[*]; provided that the provisions may be extended for an additional period of
[*] upon the mutual consent of Xxxxx and Promedix.
(c) Purchases through the Promedix Commerce Site. Members will
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purchase products through the Promedix Commerce Site in accordance with a
Supplier Agreement which Xxxxx and Promedix will negotiate in good faith and
will use commercially reasonable efforts to enter into promptly after the
Effective Date.
(d) Introduction to Suppliers. Upon Promedix's request, Xxxxx will
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use its commercially reasonable efforts to introduce Promedix to suppliers of
Specialty Products, and to encourage such suppliers to make their products
available for sale through the Promedix Commerce Site.
(e) Technology Exclusivity. For a period of [*] after the Effective
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Date, Xxxxx shall not collaborate with, work with, or assist, directly or
indirectly in any way, any third party to sponsor, co-develop, make or otherwise
support any technology or business in the Exclusive Field of Use.
(f) Other. Xxxxx will draft and forward a communication to Suppliers
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encouraging them to enter into a contract with Promedix for the sale of their
products through the Promedix Commerce Site. Xxxxx will furnish full-time
office space (cubicle) to one Promedix liason. Xxxxx will allow Promedix to
display its technology to the Xxxxx executive committee.
5. Payment Terms.
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(a) Due Dates. Except as otherwise explicitly set forth in this
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Agreement, all payments due hereunder shall be made within thirty (30) days
after the date of invoice.
(b) Late Fees. All amounts not paid on a timely basis as required by
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this Agreement shall be subject to a late charge equal to [*] per month (or,
if less, the maximum allowed by applicable law).
(c) Taxes. All payments required by this Agreement are exclusive of
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all national, state, municipal or other governmental excise, sales, value-added,
use, personal property, and occupational taxes, excises, withholding taxes and
obligations and other levies now in force or enacted in the future, all of which
the payor will be responsible for and will pay in full, except for taxes based
on the payee's net income.
(d) Audits. Each party will maintain accurate records with respect to
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payments due under this Agreement and methodology used to calculate payment due.
Each party may, upon no less than thirty (30) days prior written notice to
another party which owes such party payments hereunder,
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* Confidential Treatment Requested
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cause an independent Certified Public Accountant to inspect all relevant records
of such other party upon which the calculation of such payments are based during
normal business hours and without unreasonable disruption to such other party's
business. The fees charged by such Certified Public Accountant in connection
with the inspection will be paid by the auditing party unless the payments made
to the auditing party are determined to have been less than ninety percent (90%)
of the payments actually owed to the auditing party, in which case the other
party will be responsible for the payment of the reasonable fees for such
inspection. In addition, the other party shall immediately remit payment to the
auditing party for the full amount of any disclosed shortfalls. The audit rights
set forth herein shall continue for one (1) year following the termination of
this Agreement for any reason. No such audit may occur more than once a year
during the term of this Agreement.
6. Proprietary Rights. Promedix and Xxxxx acknowledge and agree that
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Promedix owns all right, title, and interest, including without limitation all
Intellectual Property Rights therein, to the Promedix Commerce Site, including,
without limitation, all modifications, extensions, and enhancements to such
Promedix Commerce Site made by Promedix for Members pursuant to this Agreement.
7. Confidentiality.
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(a) Nondisclosure. Each party shall treat as confidential all
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Confidential Information of the other parties, shall not use such Confidential
Information except as set forth herein, and shall use reasonable efforts not to
disclose such Confidential Information to any third party. Without limiting the
foregoing, each of the parties shall use at least the same degree of care which
it uses to prevent the disclosure of its own confidential information of like
importance to prevent the disclosure of Confidential Information disclosed to it
by the other parties under this Agreement. Each party shall promptly notify the
applicable party of any actual or suspected misuse or unauthorized disclosure of
such other party's Confidential Information.
(b) Exceptions. Notwithstanding the above, no party shall have
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liability to the other with regard to any Confidential Information of the other
which the receiving party can prove: (i) was in the public domain at the time it
was disclosed or has entered the public domain through no fault of the receiving
party; (ii) was known to the receiving party, without restriction, at the time
of disclosure, as demonstrated by files in existence at the time of disclosure;
(iii) is disclosed with the prior written approval of the disclosing party; (iv)
was independently developed by the receiving party without any use of the
Confidential Information, as demonstrated by files created at the time of such
independent development; (v) becomes known to the receiving party, without
restriction, from a source other than the disclosing party without breach of
this Agreement by the receiving party and otherwise not in violation of the
disclosing party's rights; or (vi) is disclosed pursuant to the order or
requirement of a court, administrative agency, or other governmental body;
provided, however, that the receiving party shall provide prompt notice thereof
to the disclosing party to enable the disclosing party to seek a protective
order or otherwise prevent or restrict such disclosure.
(c) Return of Confidential Information. Upon expiration or
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termination of this Agreement, upon the request of the disclosing party, each
party shall return or destroy all Confidential Information received from the
other parties.
(d) Remedies. Any breach of the restrictions contained in this
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Section 7 is a breach of this Agreement which may cause irreparable harm to the
nonbreaching party. Any such breach shall entitle the nonbreaching party to
injunctive relief in addition to all legal remedies.
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(e) Confidentiality of Agreement. Each party shall be entitled to
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disclose the existence of this Agreement, but agrees that the terms and
conditions of this Agreement shall be treated as Confidential Information and
shall not be disclosed to any third party; provided, however, that each party
may disclose the terms and conditions of this Agreement: (i) as required by any
court or other governmental body; (ii) as otherwise required by law; (iii) to
legal counsel of the parties; (iv) in confidence, to accountants, banks, and
financing sources and their advisors; (v) in connection with the enforcement of
this Agreement or rights under this Agreement; (vi) in confidence, in connection
with an actual or proposed merger, acquisition, or similar transaction; or (vii)
as mutually agreed upon by the parties.
8. Disclaimer. EXCEPT AS OTHERWISE EXPLICITLY SET FORTH IN THIS AGREEMENT
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EACH PARTY PROVIDES THE PRODUCTS AND SERVICES HEREUNDER "AS IS", AND EACH PARTY
EXPRESSLY DISCLAIMS ALL WARRANTIES, WHETHER EXPRESS, IMPLIED, CONTRACTUAL OR
STATUTORY, INCLUDING, WITHOUT LIMITATION, ANY IMPLIED WARRANTY OF
MERCHANTABILITY, NONINFRINGEMENT OR FITNESS FOR A PARTICULAR PURPOSE.
9. Term and Termination.
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(a) Term. This Agreement shall be effective from the Effective Date
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and shall continue in effect for a period of fifteen (15) years unless
terminated earlier pursuant to the provisions of Section 9(b).
(b) [Intentionally left blank]
(c) Effect of Termination. The provisions of Sections 1, 5, 6, 8,
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9(c), 10, and 11 of this Agreement, and all payment obligations incurred prior
to termination, shall survive the termination of this Agreement for any reason.
The provisions of Section 7 of this Agreement shall survive the termination of
this Agreement for a period of three (3) years. All other rights and
obligations of the parties shall cease upon termination of this Agreement.
10. Limitation of Liability. IN NO EVENT SHALL ANY PARTY BE LIABLE TO THE
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OTHERS FOR COSTS OF PROCUREMENT OF SUBSTITUTE PRODUCTS OR SERVICES, LOST
PROFITS, OR ANY CONSEQUENTIAL, SPECIAL, PUNITIVE, INCIDENTAL, OR INDIRECT
DAMAGES, HOWEVER CAUSED AND ON ANY THEORY OF LIABILITY (INCLUDING NEGLIGENCE OR
STRICT LIABILITY), ARISING OUT OF THIS AGREEMENT. THE PARTIES ACKNOWLEDGE AND
AGREE THAT THE AMOUNTS PAYABLE HEREUNDER ARE BASED IN PART UPON THESE
LIMITATIONS, AND FURTHER AGREES THAT THESE LIMITATIONS SHALL APPLY
NOTWITHSTANDING ANY FAILURE OF ESSENTIAL PURPOSE OF ANY LIMITED REMEDY.
11. Miscellaneous.
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(a) Amendments and Waivers. Any term of this Agreement may be amended
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or waived only with the written consent of the parties or their respective
permitted successors and assigns. Any amendment or waiver effected in
accordance with this Section 11(a) shall be binding upon the parties and their
respective successors and assigns.
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(b) Successors and Assigns. No party shall assign any of its rights,
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obligations or privileges (by operation of law or otherwise) hereunder without
the prior written consent of the other parties; provided, however, that any
party shall have the right to assign its rights, obligations and privileges
hereunder, upon thirty (30) days prior written notice to the other parties, to a
merger partner, successor in business or acquirer of all or substantially all of
such party's business or assets without obtaining consent from the other parties
to such assignment. The terms and conditions of this Agreement shall inure to
the benefit of and be binding upon the respective permitted successors and
assigns of the parties. Nothing in this Agreement, express or implied, is
intended to confer upon any party other than the parties hereto or their
respective successors and assigns any rights, remedies, obligations, or
liabilities under this Agreement, except as expressly provided in this
Agreement.
(c) Governing Law. This Agreement and all acts and transactions
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pursuant hereto and the rights and obligations of the parties hereto shall be
governed, construed and interpreted in accordance with the laws of the State of
California, United States of America, without giving effect to principles of
conflicts of law or to the Convention on Contracts for the International Sale of
Goods.
(d) Jurisdiction. The parties consent to the exclusive jurisdiction
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and venue of the state and federal courts of Santa Xxxxx County, California.
(e) Counterparts. This Agreement may be executed in two or more
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counterparts, each of which shall be deemed an original and all of which
together shall constitute one instrument.
(f) Titles and Subtitles. The titles and subtitles used in this
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Agreement are used for convenience only and are not to be considered in
construing or interpreting this Agreement.
(g) Notices. Any notice required or permitted by this Agreement shall
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be in writing and shall be deemed sufficient upon receipt, when delivered
personally or by courier, overnight delivery service or confirmed facsimile or
electronic mail, or forty-eight (48) hours after being deposited in the regular
mail as certified or registered mail (airmail if sent internationally) with
postage prepaid, if such notice is addressed to the party to be notified at such
party's address or facsimile number as set forth below, or as subsequently
modified by written notice.
Chemdex: NewCo:
Chemdex Corporation c/x Xxxxx HealthSystem Medical, Inc.
0000 Xxxxxxxx Xxxxxx 0000 Xxxxx Xxxxxx
Xxxxxxxx Xxxx, XX 00000 Xxxxx Xxxxxxx, XX 00000
Fax: (000) 000-0000 Fax: (000) 000-0000
Attn: Xxxx Xxxxx Attn: Xxxxxxx X. Xxxxxxxx
Promedix: Xxxxx:
Xxxxxxxx.xxx, Inc. Xxxxx HealthSystem Medical, Inc.
000 Xxxx Xxxxxxxxxx Xxxxxx 0000 Xxxxx Xxxxxx
Xxxx Xxxx Xxxx, XX 00000
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Fax: (000) 000-0000 Xxxxx Xxxxxxx, XX 00000
Attn: Xxxxxxx X. Xxxxxxxxxx, Xx.
Fax: (000) 000-0000
Attn: Xxxxxxx X. Xxxxxxxx
(h) Severability. If one or more provisions of this Agreement are
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held to be unenforceable under applicable law, the parties agree to renegotiate
such provision in good faith, in order to maintain the economic position enjoyed
by each party as close as possible to that under the provision rendered
unenforceable. In the event that the parties cannot reach a mutually agreeable
and enforceable replacement for such provision, then (i) such provision shall be
excluded from this Agreement, (ii) the balance of the Agreement shall be
interpreted as if such provision were so excluded and (iii) the balance of the
Agreement shall be enforceable in accordance with its terms.
(i) Independent Contractor. No party shall, for any purpose, be
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deemed to be an agent of any other party and the relationship between the
parties shall only be that of independent contractors. No party shall have any
right or authority to assume or create any obligations or to make any
representations or warranties on behalf of any other party, whether express or
implied, or to bind any other party in any respect whatsoever.
(j) Force Majeure. In the event that any party is prevented from
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performing or is unable to perform any of its obligations under this Agreement
(other than a payment obligation) due to any Act of God, fire, casualty, flood,
earthquake, war, strike, lockout, epidemic, destruction of production
facilities, riot, insurrection, material unavailability, or any other cause
beyond the reasonable control of the party invoking this Section, and if such
party shall have used its best efforts to mitigate its effects, such party shall
give prompt written notice to the other parties, its performance shall be
excused, and the time for the performance shall be extended for the period of
delay or inability to perform due to such occurrences.
(k) Entire Agreement. This Agreement (as amended pursuant to Section
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11(a)) constitutes the entire agreement of the parties pertaining to the subject
matter hereof, and merges all prior negotiations and drafts of the parties with
regard to the transactions contemplated herein. Any and all other written or
oral agreements existing between the parties hereto regarding such transactions
are expressly canceled.
(l) Advice of Legal Counsel. Each party acknowledges and represents
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that, in executing this Agreement, it has had the opportunity to seek advice
regarding its legal rights from legal counsel and that the person signing on its
behalf has read and understood all of the terms and provisions of this
Agreement. This Agreement shall not be construed against any party by reason of
the drafting or preparation thereof.
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The parties have executed this Agreement as of the date first set forth
above.
XXXXX HEALTHSYSTEM MEDICAL, INC. TENDEX, INC.
By:____________________________ By:_______________________________
Name:__________________________ Name:_____________________________
Title:_________________________ Title:____________________________
XXXXXXXX.XXX, INC. CHEMDEX CORPORATION
By:____________________________ By:_______________________________
Name:__________________________ Name:_____________________________
Title:_________________________ Title:____________________________
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EXHIBIT A
XXXXX GPO ADMINISTRATION
A. NewCo Management Services.
In connection with NewCo's provision of technology to enable Xxxxx
Suppliers and Members to conduct online purchase and sale transactions through
the NewCo Marketplace, Xxxxx desires to engage NewCo to perform the functions
and to provide the services described in this Exhibit A with respect to Non-
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Online Transactions which occur after the Effective Date hereof as more
particularly described below. For purposes of this Exhibit A, "Online
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Transactions" shall refer to purchases of products by Members from Xxxxx
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Suppliers via the NewCo Marketplace, and "Non-Online Transactions" shall refer
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to all other purchases of products by Members from Xxxxx Suppliers.
1. Duties of NewCo. NewCo agrees to conduct, supervise and effectively
manage the day-to-day Non-Online Transaction business affairs of the Xxxxx GPO
as reasonably requested by Xxxxx during the term of this Agreement, including
the provision of all personnel reasonably required to accomplish this
undertaking. Any powers not specifically delegated or granted by Xxxxx to NewCo
will remain with Xxxxx. NewCo shall use all reasonable commercial efforts to
implement the Xxxxx GPO's policies and directives with the goal of causing the
Xxxxx GPO to provide quality group purchasing organization services to Members
consistent with the policies and directives set by Xxxxx, the financial
resources available to the Xxxxx GPO, the competitive marketplace in which the
Xxxxx GPO operates, Medicare reimbursement and other laws and, ultimately
migrate Non-Online Transactions to Online Transactions. In the absence of such
oral or written policies or standards, NewCo shall be expected to exercise its
reasonable judgment in its management activities and to conduct such management
activities according to the same standards by which it governs its own affairs.
A description of certain of the management services to be provided by NewCo are
set forth on Attachment A hereto. Without limiting the generality of the
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services described herein, such management services shall include personnel
administration, maintenance of accounting and financial, as required, payment of
accounts, including administrative fees, on behalf of the Xxxxx GPO to Members,
depositing funds in accounts designated by Xxxxx, preparation of an annual
business plan for the Xxxxx GPO including a Xxxxx GPO budget, marketing
services, legal services and pursuit and negotiation of vendor and member
agreements on the Xxxxx GPO behalf, all as reasonably required by Xxxxx.
2. Term. Notwithstanding Section 9 of the Agreement, the term of the
management services described on this Exhibit A shall commence on ___________,
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1999 (the "Commencement Date") and unless sooner terminated as provided herein,
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shall continue for as long as the Xxxxx GPO shall operate as a group purchasing
organization conducting Non-Online Transactions or until such time as Xxxxx,
upon 180 days prior notice to NewCo, because of a general reduction in Non-
Online Transactions, no longer requires such management services.
3. Retention of Authority. Throughout the term of the provision of the
management services described herein, Xxxxx shall retain all authority and shall
exercise control over the business, policies, operation, and assets of the Xxxxx
GPO. NewCo shall perform the services described in this Agreement in accordance
with the reasonable policies and directives of Xxxxx as may be from time to time
provided to it, including approval of vendor and distributor agreements. By
entering into this agreement, Xxxxx does not delegate to NewCo any of the
powers, duties, and responsibilities vested in Xxxxx by the bylaws of Xxxxx. In
matters pertaining to the Xxxxx GPO, NewCo may rely on, assume the
* Confidential Treatment Requested. Bolded and Bracketed portions have been
omitted and have been filed separately with the SEC.
validity of communications from, and report to Xxxxx Xxxxxxxx, his designee or
such other person designated by Xxxxx.
4. Standards of Performance. Xxxxx acknowledges that, while NewCo shall
expend its commercially reasonable efforts in performing its obligations under
this agreement, NewCo does not guarantee any particular results. NewCo shall
act in good faith and with professionalism to assist Xxxxx in the provision of
quality services.
5. Management Fee and Expenses. In exchange for NewCo's services
rendered to Xxxxx under the terms of this Exhibit A, Xxxxx shall pay NewCo the
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following amounts:
a. Management Fee. On or before the tenth (10th) day of each calendar
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month during the term of this Exhibit A, commencing with the second such month,
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and continuing on or before the tenth (10th) day of each calendar month
thereafter until the month following the expiration or earlier termination of
this agreement, NewCo shall provide Xxxxx with an itemization of Costs
attributed to the provision of management services described herein. Within
twenty (20) days of Xxxxx'x receipt of such itemization of Costs, Xxxxx shall
pay to NewCo NewCo's Cost, as defined herein, of providing the management
services described herein. NewCo's Cost of providing the management services
shall be subject to audit in accordance with Section 5(d).
b. Reimbursement of Expenses. In addition to the compensation paid to
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NewCo pursuant to Section 5(a) above, Xxxxx shall reimburse NewCo for reasonable
amounts advanced by NewCo on behalf of Xxxxx. NewCo shall provide Xxxxx with
itemized and documented statements of such amounts no later than the tenth
(10th) day of the month after such expenses were incurred. Subject to the
foregoing, Xxxxx shall reimburse NewCo no later than twenty (20) days after
receipt of such itemized statement.
6. Duty to Cooperate. The parties acknowledge that the parties' mutual
cooperation is critical to the ability of NewCo to perform its duties hereunder
successfully and efficiently. Accordingly, each party agrees to cooperate with
the other fully in formulating and implementing goals and objectives which are
reasonably necessary for the operation of the Xxxxx GPO.
7. Confidentiality. Each party shall protect the Confidential
Information of the other party in accordance with Section 7 of the Agreement.
8. Communications and Reports. NewCo shall present to Xxxxx periodic
written progress reports summarizing NewCo's management actions and results, and
such other written reports as Xxxxx reasonably considers appropriate to keep it
informed as to the status and condition of the operation of the Xxxxx GPO.
9. Annual Budget. Within ninety (90) days of the end of each calendar
year, NewCo shall prepare and submit to Xxxxx a budget for providing the
management services described herein for the coming year. Xxxxx shall have
forty-five (45) days from its receipt of the proposed budget to approve or
disapprove such proposed budget. If Xxxxx accepts the budget, it will
constitute the budget for management fees and expenses for the coming year. If
Xxxxx rejects the proposed budget, the parties will meet, as soon as is
reasonably practicable, and make a good faith attempt to resolve the disputed
items in the budget. In the event the parties are unable to resolve the
disputed items, the parties will utilize the budget for the preceding year as
the budget for the coming calendar year. For the first
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calendar year of this agreement the budget will be equal to the Xxxxx GPO's
departmental budget for Xxxxx'x current fiscal year.
10. Insurance. NewCo shall purchase and maintain throughout the term of
this Exhibit insurance with responsible companies for risks and in amounts as
are commercially reasonable and agreed to by the parties naming Xxxxx as an
additional insured.
11. Termination. Notwithstanding Section 9 of the Agreement, this Exhibit
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A may be terminated by either Xxxxx or NewCo:
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a. If a party shall default in the performance of any material covenant,
agreement, term or provision of this Exhibit to be kept, observed or performed
by such party and such default shall not be cured for a period of sixty (60)
days after written notice is given to the defaulting party stating the specific
default.
b. If the Xxxxx GPO ceases operation.
c. If either Xxxxx or NewCo shall do any of the following: apply for or
consent to the appointment of a receiver, trustee or liquidator of all or a
substantial part of its assets; file a voluntary petition in bankruptcy or admit
in writing its inability to pay its debts as they become due; make a general
assignment for the benefit of creditors, file a petition or an answer seeking
organization or arrangement with creditors; take advantage of any insolvency
law; or, if an order, judgment or decree shall be entered by a court of
competent jurisdiction, on the application of a creditor, adjudicating the party
bankrupt or insolvent or approving a petition seeking reorganization of a party
or appointing a receiver, trustee or liquidator of all or a substantial part of
its assets.
12. Indemnification. To the extent not otherwise covered by insurance,
Xxxxx and NewCo shall each indemnify and hold the other party and its employees
and agents harmless from any and all loss, liability or damage, of any kind
whatsoever, including, but not limited to, attorneys' fees and court costs
arising out of, or in any manner occasioned by, breach by a party, its agents,
employees, servants or subcontractors, of any covenant and/or condition of this
Exhibit, or by the negligence, improper conduct or intentional acts or omissions
of a party, its agents, employees, servants or subcontractors.
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Attachment A
Services
. NewCo will perform all corporate Material Resource Management functions
for the Xxxxx GPO, including providing oversight for IMMS and strategic
directions related to operations and utilization programs
. NewCo will oversee and manage all Xxxxx GPO functions including:
-Negotiation and management of supply and service agreements
-Recruiting and managing all aspects of Xxxxx GPO affiliate
relationships
-Marketing and recruiting new internet customers wanting to access the
NewCo Marketplace
-Serving as the technology liason to Chemdex
-Collection and disbursement of administrative fees, rebates, and
transaction fees
* Confidential Treatment Requested. Bolded and Bracketed portions have been
omitted and have been filed separately with the SEC.
EXHIBIT B
SERVICES PROVIDED BY PROMEDIX TO MEMBERS
1. Integration Services.
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Promedix will integrate with Xxxxx members and participants enterprise systems.
This will include the following steps:
1) Identifying system requirements
2) Mapping necessary information interchange between systems
3) Define systems requirements between systems
4) Beta testing system integration
5) Launch system integration
1. Training Services.
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Promedix will provide some training services to Xxxxx in order to drive
adoption. This will include the following:
1) Product company launch event
2) On site end user training
3) Train -the- trainer course
4) On site administrator training course
5) Computer demo training courses
