CONFIDENTIAL TREATMENT REQUESTED
EXHIBIT 10.23
STRATEGIC ALLIANCE AGREEMENT
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This Strategic Alliance Agreement (the "Agreement") is entered into this
15th day of June, 1998, by and between ENDEAVOR TECHNOLOGIES, INC., a Georgia
corporation ("Endeavor"), and ENVOY CORPORATION, a Tennessee corporation (the
"Company").
WHEREAS, Endeavor is engaged in, among other things, the business of
promoting, selling and providing under its "WebMD/SM/" brand name certain
Internet-based information and communications services ("WebMD");
WHEREAS, the Company is engaged, directly and through its affiliates, in
the business of promoting, selling and providing healthcare-related services
(the "Company Services"); and
WHEREAS, the parties to this Agreement desire to enter into a strategic
alliance pursuant to the terms and conditions set forth in this Agreement.
NOW, THEREFORE, in consideration of the mutual promises and covenants
contained in this Agreement, the parties hereto agree as follows:
1. MARKETING AND PROMOTION OF WebMD. Endeavor grants the Company a
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nonexclusive, nontransferrable, nonassignable and limited right to market WebMD
solely as set forth in this Agreement and pursuant to the following obligations
and goals:
(a) Endeavor's Obligations.
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(i) Consultation. Endeavor will consult with and advise
the Company regarding strategies for marketing and selling WebMD,
both directly and through various third party channels, and will,
at the Company's request and at Endeavor's expense, hold up to
five seminars in Atlanta, Georgia or other mutually agreeable
locations, for the Company's sales personnel regarding the
features, uses and pricing of WebMD.
(ii) Resources. At no cost to the Company, Endeavor will
make marketing materials available to assist the Company in
marketing WebMD.
(iii) Fulfillment. Endeavor agrees to allow WebMD
subscribers who are enrolled by Endeavor through the Company's
marketing efforts (the "Subscribers") to subscribe to WebMD at
the prices set forth on Exhibit A hereto.
(iv) Endeavor agrees to use ENVOY's EDI Services
exclusively during the term of the Agreement as an integrated
product with WebMD. No competitive services will be permitted
unless otherwise agreed to by ENVOY. ENVOY and WebMD will
mutually agree to the form and contract of End User's Agreements
for the EDI Services with WebMD. The exclusive integration and
branding of the ENVOY EDI Services in WebMD shall be subject to
the following conditions. Should ENVOY fail to be successful in
obtaining the first
milestone (*** per Subscriber Target December 31, 1998 - Exhibit
B), Endeavor shall have the right to give the Company written
notice within 30 days that it deems ENVOY behind schedule and
that Endeavor is not satisfied with results to date. In that
event, ENVOY shall have a cure period of 180 days to not only
achieve the first milestone but to bring current the pro rata
second milestone (an additional *** units by that date). Should
ENVOY fail to cure, at Endeavor's option, the WebMD browser and
site may be additionally branded and integrated with other EDI
services. Should Endeavor choose to allow other EDI services
branded and integrated with its browser and site, it will use its
best efforts to require such services to use ENVOY as the back
end switch.
(b) Company Obligations.
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(i) Channels and Strategies. The Company agrees to use
commercially reasonable efforts to market WebMD and to enroll
subscribers to WebMD by employing the following marketing
strategies:
(A) Direct Sales. Use the Company's direct and indirect
sales personnel who are currently marketing the Company
Services to market WebMD and enroll subscribers to WebMD
and, in connection therewith, to cause the Company's direct
and indirect sales personnel to be educated on the features,
uses and pricing of WebMD.
(B) Web Site. Promote WebMD on all Web sites maintained
by the Company.
(C) Direct Mail and Telemarketing. At the Company's
option and with the consent of Endeavor, promote WebMD using
direct mail and/or telemarketing.
(D) Partner Programs. When and if commercially
reasonable, market WebMD to its strategic partners and
encourage such strategic partners to market WebMD through
such strategic partners' direct and indirect sales
personnel.
(ii) Goals. The Company agrees to use commercially
reasonable efforts to enroll the number of new subscribers to
WebMD that are specified on Exhibit B hereto, within the
respective time periods set forth on Exhibit B, it being
understood and agreed that the targets set forth on Exhibit B
merely constitute a good faith estimate by the Company of the
number of WebMD subscribers that it expects to enroll during the
specified time periods and that the
*** Omitted pursuant to a request for confidential treatment and filed
separately with the Commission.
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failure to meet the targets set forth on Exhibit B shall not by
itself constitute a breach of this Agreement by the Company.
2. PAYMENT TERMS. Endeavor shall remit to the Company a one-time
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incentive commission per new paid Subscriber as indicated on Exhibit C hereto
within 30 days of Endeavor's receipt of the initial monthly fee from such
Subscriber. Fees pursuant to Section 1(a)(iii) hereof shall be payable by the
Subscriber within 30 days following the end of each calendar month in which such
fees accrue.
3. WARRANTIES AND LIMITATION OF LIABILITY.
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(a) THE PARTIES MAKE NO EXPRESS OR IMPLIED WARRANTIES TO EACH
OTHER, SUBSCRIBERS OR ANY THIRD PARTY WITH RESPECT TO WebMD OR ANY UPDATES,
REVISIONS OR ADDITIONS THERETO, OR ANY COPIES THEREOF, OR OTHERWISE
REGARDING THIS AGREEMENT, WHETHER ORAL OR WRITTEN, EXPRESS OR IMPLIED,
INCLUDING, WITHOUT LIMITATION, THE IMPLIED WARRANTY OF MERCHANTABILITY, THE
IMPLIED WARRANTY AGAINST INFRINGEMENT AND THE IMPLIED WARRANTY OF FITNESS
FOR A PARTICULAR PURPOSE.
(b) EACH PARTY ACKNOWLEDGES AND AGREES THAT THE OTHER PARTY
SHALL HAVE NO LIABILITY TO THE PARTY OR ANY THIRD PARTY IN WARRANTY,
CONTRACT, NEGLIGENCE, STRICT LIABILITY, TORT OR OTHERWISE REGARDING ANY
DESIGN, DEVELOPMENT, PRODUCTION, PERFORMANCE, COMPATIBILITY, USE OF OR
INABILITY TO USE WebMD OR ANY UPDATES, REVISIONS OR ADDITIONS THERETO, OR
ANY COPIES THEREOF, OR OTHERWISE REGARDING THIS AGREEMENT.
(c) IN NO EVENT WILL EITHER PARTY'S LIABILITY FOR ANY DAMAGES TO
THE OTHER PARTY OR ANY THIRD PARTY EVER EXCEED THE AMOUNT OF COMMISSIONS OR
OTHER FEES PAID BY ENDEAVOR TO THE COMPANY HEREUNDER, REGARDLESS OF THE
FORM OF ACTION, WHETHER IN CONTRACT, NEGLIGENCE, STRICT LIABILITY, TORT,
PRODUCTS LIABILITY OR OTHERWISE.
(d) NOTWITHSTANDING ANYTHING HEREIN TO THE CONTRARY, IN NO EVENT
SHALL EITHER PARTY BE LIABLE, DIRECTLY OR INDIRECTLY, FOR SPECIAL,
INDIRECT, INCIDENTAL OR CONSEQUENTIAL DAMAGES, LOSS OF PROFITS OR LOSS OF
GOODWILL, REGARDLESS OF CAUSE OF ACTION, ARISING OUT OF OR RELATED TO THIS
AGREEMENT OR THE PERFORMANCE THEREOF, EVEN IF THE PARTY WAS AWARE OF AND
WAS NOTIFIED OF THE POSSIBILITY OF SUCH DAMAGES.
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(e) The provisions of this Section 3 shall survive the
termination or expiration of this Agreement.
4. ADVERTISING, TRADEMARKS AND COPYRIGHTED MATERIALS.
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(a) Endeavor hereby grants the Company a revocable license to
use any Endeavor service xxxx, trademark, trade name and logo associated
with WebMD (the "Endeavor Marks") solely in the advertisement and promotion
of WebMD during the term of this Agreement. The Company shall not use any
xxxx, name or logo to identify WebMD other than the Endeavor Marks without
Endeavor's prior written consent. The Company acknowledges that the
Endeavor Marks are valid service marks, trademarks, trade names and logos
and the sole property of Endeavor, and the Company shall not disparage or
challenge the validity of the Endeavor Marks during the term of this
Agreement. The Company shall promptly notify Endeavor of any actual or
alleged infringements of Endeavor Marks of which the Company becomes aware
during the term. Nothing contained herein shall be construed to authorize
the Company: (i) to use any Endeavor Marks as a xxxx, name or logo or as
part of the xxxx, name or logo of any firm, partnership or corporation;
(ii) to apply any Endeavor Xxxx to any goods or to use any Endeavor Xxxx in
connection with any services except as set forth in this Agreement; or
(iii) at any time after the termination of this Agreement, to apply any
Endeavor Xxxx to goods or to otherwise use any Endeavor Xxxx in any manner
whatsoever.
(b) The Company hereby grants Endeavor a revocable license to
use any of the Company's service marks, trademarks, trade names and logos
(the "Company Marks") solely in the advertisement and promotion of WebMD
during the term of this Agreement as set forth in this Section 4(b).
Endeavor may use the Company Marks, mention the Company's name and mention
and/or describe the strategic relationship between the Company and Endeavor
in print and online advertisements, marketing materials, registration
statements and other reports that are filed with the Securities and
Exchange Commission (pursuant to which Endeavor may also file this
Agreement as an exhibit) and other information; provided, however, that the
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Company shall be given five days prior written notice of Endeavor's
intention to use the Company Marks, and the Company shall not have
reasonably objected to Endeavor's use of the Company Marks prior to the
expiration of such five-day period. Endeavor acknowledges that the Company
Marks are valid service marks, trademarks, trade names and logos of the
Company and the sole property of the Company, and Endeavor shall not
disparage or challenge the validity of the Company Marks during the term of
this Agreement. Endeavor shall promptly notify the Company of any actual or
alleged infringements of the Company Marks of which Endeavor becomes aware
during the term of this Agreement.
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5. CONFIDENTIALITY.
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(a) For purposes of this Section 5, the following terms shall
have the meanings as specified below:
(i) "Trade Secrets" means information which: (A) derives
economic value, actual or potential, from not being generally known
and not being ascertainable by proper means by, other persons who can
obtain economic value from its disclosure or use; and (B) is the
subject of efforts that are reasonable under the circumstances to
maintain its secrecy.
(ii) "Confidential Information" means information, other than
Trade Secrets, that is of value to its owner and is treated as
confidential.
(iii) "Proprietary Information" means Trade Secrets and
Confidential Information.
(b) Each party ("Receiving Party") agrees to hold the
Proprietary Information of the other party ("Disclosing Party") in
strictest confidence and not to, directly or indirectly, copy, reproduce,
distribute, duplicate, reveal, report, publish, disclose, cause to be
disclosed, or otherwise transfer the Proprietary Information of the
Disclosing Party to any third party, or utilize the Proprietary Information
of the Disclosing Party for any purpose whatsoever other than as
specifically authorized by this Agreement. With regard to the Trade
Secrets, this obligation shall continue for so long as such information
constitutes a trade secret under applicable law. With regard to the
Confidential Information, this obligation shall continue for the term of
this Agreement and for a period of five years thereafter. The Receiving
Party acknowledges and agrees that the Proprietary Information of the
Disclosing Party is and shall at all times remain the sole and exclusive
property of the Disclosing Party and in the event of termination or
expiration of this Agreement for any reason, the Receiving Party shall
return immediately to the Disclosing Party all Proprietary Information of
the Disclosing Party and any copies thereof in its possession or under its
control. Upon the return of such Proprietary Information, the Receiving
Party shall provide the Disclosing Party with a signed written statement
certifying that it has returned all Proprietary Information of the
Disclosing Party and any copies thereof to the Disclosing Party.
(c) Without limiting the general obligations specified in
subparagraph (b) above, the Receiving Party agrees to implement the
following security steps in order to protect the confidentiality and
security of the Proprietary Information of the Disclosing Party:
(i) Implement internal procedures to limit, control and
supervise the use of the Proprietary Information of the Disclosing
Party.
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(ii) Make the Proprietary Information of the Disclosing Party
available only to full-time employees of the Receiving Party who have
executed written agreements requiring them to recognize the
proprietary and confidential nature of the Proprietary Information of
the Disclosing Party and to comply with the nondisclosure obligations
set forth herein.
(iii) Notify the Disclosing Party in writing of any suspected or
known breach of the obligations and/or restrictions set forth in this
Section 5.
(iv) Use those security procedures it uses for its own
proprietary information which it protects against unauthorized
disclosure, appropriation or use.
(d) The obligations imposed on a Recipient Party with respect
to Confidential Information shall not apply to Confidential Information
disclosed to it hereunder which (a) the Recipient Party can demonstrate is
at the time of disclosure already known to the Recipient Party, (b) is or
becomes generally known to the public or is otherwise deemed to be in the
public domain through no wrongful act of the Recipient Party, (c) is
received from a third party which the Recipient Party reasonably believes
has the legal right to so furnish such Confidential Information, or (d) the
Recipient Party can demonstrate is independently developed by or for the
Recipient Party without use of Confidential Information.
6. NOTICES. All notices, consents, requests, instructions, approvals, and
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other communications made, required or permitted hereunder (each herein, a
"Notice") shall be given in writing and delivered to the receiving party to its
respective address set forth below (i) by personal delivery to a responsible
officer of such party, (ii) by certified or registered mail (return receipt
requested), (iii) by a nationally recognized courier service or (iv) by
facsimile transmission (such to be confirmed by mail). The effective date of
such Notice shall be deemed to be the date upon which any such Notice is
personally delivered or, if it is given by mail, courier service or facsimile
transmission, the date upon which it is received by the addressee. Any party
hereto may change its address set forth below by written notice to the other
party hereto in accordance with the terms of this Section 6.
If to Endeavor:
Endeavor Technologies, Inc.
0000 Xxxxxxxxx Xxxx XX
000 Xxx Xxxxx Xxxxxxxx
Xxxxxxx, XX 00000
Attn: Xx. Xxxxxxx X. Xxxxxx
Facsimile: (000) 000-0000
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With a copy to (which shall not constitute notice):
Xxxxxx Xxxxxxx Xxxxx & Scarborough, LLP
First Union Plaza, Suite 1400
000 Xxxxxxxxx Xxxxxx
Xxxxxxx, XX 00000
Attn: Xxxxx X. Xxxxx, Esq.
Facsimile: (000) 000-0000
If to the Company:
ENVOY Corporation
Two Lakeview Place
00 Xxxxxxx Xxxxxxxxx, Xxxxx 000
Xxxxxxxxx, XX 00000
Attn: Xx. Xxx X. Xxxxx
Facsimile: (000) 000-0000
With a copy to (which shall not constitute notice):
ENVOY Corporation
Two Lakeview Place
00 Xxxxxxx Xxxxxxxxx, Xxxxx 000
Xxxxxxxxx, XX 00000
Attn: Xxxxxxx X. Xxxxxxx, Esq.
Facsimile: (000) 000-0000
7. REPRESENTATIONS AND WARRANTIES. Each party represents and warrants that
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it is under no obligation or restriction which would prohibit it from entering
or performing this Agreement, or cause it to be in breach of this Agreement.
Each party to this Agreement represents and warrants to the other party that
this Agreement, when signed on behalf of it, constitutes the legal, valid and
binding obligation of such party enforceable in accordance with its terms.
8. REPORTS. Each party shall provide the other party with such reports as
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reasonably requested in order to facilitate each party's obligations under this
Agreement.
9. TERM AND TERMINATION.
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(a) Term; Renewal Term. This Agreement shall take effect on the
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date first set forth above and shall continue until the fifth anniversary
thereof. Thereafter, this Agreement shall automatically renew for
successive one-year periods (each, a
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"Renewal Term") unless either party gives the other party written notice of
termination at least 90 days in advance of the beginning of a Renewal Term.
(b) Termination for Breach. Upon a material breach of any
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provision of this Agreement, the non-breaching party shall give notice of
such breach to the breaching party. The breaching party shall have 60 days
from the receipt of said notice to cure the breach described in the notice.
If the breach is not cured within said 60-day period, the non-breaching
party shall have the right, thereafter, to terminate this Agreement by
giving written notice thereof to the breaching party.
(c) Termination for Insolvency. Upon notice, either party may
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terminate this Agreement with immediate effect: (i) upon the institution
by the other party of proceedings to be adjudicated a bankrupt or
insolvent, or the consent by the other party to institution of bankruptcy
or insolvency proceedings against it or the filing by the other party of a
petition or answer or consent seeking reorganization or release under the
Federal Bankruptcy Act, or any other applicable Federal or state law, or
the consent by the other party to the filing of any such petition or the
appointment of a receiver, liquidator, assignee, trustee, or other similar
official of the other party or of any substantial part of its property, or
the making by the other party of an assignment for the benefit of
creditors; (ii) if, within 60 days after the commencement of an action
against the other party seeking any bankruptcy, insolvency, reorganization,
liquidation, dissolution or similar relief under any present or future law
or regulation, such action shall not have been dismissed or all orders or
proceedings thereunder affecting the operations or the business of the
other party stayed, or if the stay of any such order or proceeding shall
thereafter be set aside; or if, within 60 days after the appointment
without the consent or acquiescence of the other party of any trustee
receiver or liquidator or similar official of the other party, or of all or
any substantial part of the property of the other party, such appointment
shall not have been vacated.
(d) Effect of Termination. Termination or expiration of this
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Agreement shall not relieve the parties of any liability which accrued
hereunder prior to the effective date of such termination nor preclude
either party from pursuing all rights and remedies it may have hereunder or
at law or in equity with respect to any breach of this Agreement.
10. ASSIGNMENTS. This Agreement shall be binding upon and inure solely to
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the benefit of the parties hereto and their respective successors and permitted
assigns. This Agreement may not be assigned by either party hereto without the
prior written consent of the other party hereto.
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11. GEORGIA LAW. This Agreement shall be governed by and construed in
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accordance with the laws of the State of Georgia applicable to agreements
entirely made and performed within the State.
12. INDEPENDENT PRINCIPALS. Endeavor and the Company are independent
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principals in all relationships and actions under and contemplated by this
Agreement. This Agreement shall not be construed to create any employment,
partnership, joint venture or agency relationship between the parties or to
authorize the Company to enter into any commitment or agreement binding on
Endeavor. The Company shall not make any warranties, guarantees or any other
commitment on behalf of Endeavor.
13. MISCELLANEOUS.
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(a) No party shall be liable for a delay in the performance of
its obligations and responsibilities under this Agreement due to causes
beyond its reasonable control, including, but not limited to, prohibitions
or requirements of applicable laws, failures or delays in transportation or
communication, failure or substitutions of equipment, labor disputes,
accidents, shortages of labor, fuel, raw materials or equipment or
technical failures, provided that the delayed party has taken reasonable
measures to notify the other, in writing, of the delay. The time for
completion of any obligation to which this provision applies shall be
extended for a period equivalent to the delay.
(b) No failure or delay (in whole or in part) on the part of any
party to exercise any right or remedy shall operate as a waiver thereof,
nor affect any other right or remedy. All rights and remedies hereunder
are cumulative and are not exclusive of any other rights or remedies
provided hereunder or by law.
(c) If any provision contained in this Agreement is or becomes
invalid, illegal, or unenforceable in whole or in part, such invalidity,
legality, or unenforceability shall not affect the remaining provisions and
portions of this Agreement.
(d) The headings in this Agreement are for convenience only and
shall not affect the construction or interpretation of this Agreement.
(e) This Agreement constitutes the entire agreement between the
parties with respect to the subject matter hereof and supersedes all prior
or contemporaneous oral or written understandings or agreements among the
parties which relate to the subject matter hereof. No modification or
amendment of this Agreement or any of its provisions shall be binding upon
any party unless made in writing and duly executed by authorized
representatives of the parties; provided, however, that Endeavor may, in
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its sole discretion, amend Exhibit A and/or Exhibit C hereto upon 180 days
prior notice to the Company; provided further that Endeavor may not
increase the prices
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specified in Exhibit A during the initial term of the subscription
agreements which are in effect on the effective date of the price increase;
and provided further that if Endeavor amends Exhibit A or Exhibit C, the
Company may terminate this Agreement within 30 days after receiving written
notice of such amendment.
(f) This Agreement may be executed in any number of
counterparts, each of which shall constitute an original, but all of which
together shall constitute one instrument notwithstanding that all parties
are not signatories to the same counterparts.
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IN WITNESS WHEREOF, Endeavor and the Company, intending to be legally bound
by the terms of this Agreement, have caused this Agreement to be executed by
their duly authorized representatives.
ENDEAVOR TECHNOLOGIES, INC.
By: /s/ W. Xxxxxxx Xxxxxx
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Name: W. Xxxxxxx Xxxxxx
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Title: Chief Operating Officer
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ENVOY CORPORATION
By: /s/ Xxxxxxx X. Xxxxxxx
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Name: Xxxxxxx X. Xxxxxxx
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Title: Vice President and General Counsel
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EXHIBIT A
WEBMD PRICING SCHEDULE
Endeavor will provide the following WebMD service offerings:
1. Promotional Package - $***/month/physician office:
a. Online EDI Services - provided by ENVOY Corporation for
electronic eligibility verifications and referrals.
b. Subscription to WebMD.
c. Virtual Receptionist - integrated messaging platform which is
fully accessible via telephone or Internet, featuring 800-access
voice mail, text-to-speech e-mail, fax on demand, conference
calling, calling card and contact manager.
d. Personal Physician Internet home page supplied in conjunction
with the Virtual Receptionist service offering.
e. Network Computer Hardware Package - including terminal, monitor
and printer.
f. Unlimited Local Dial-up Internet Access - provided via an ISP
facilitated by Endeavor.
The Promotional Package requires a three-year enrollment commitment by
Subscriber and is not terminable. In addition, only one Promotional Package may
be placed per physician office site.
2. Basic Package - $***/month/Subscriber:
a. Online EDI Services.
b. Subscription to WebMD.
c. Virtual Receptionist.
d. Customized Physician Internet Home Page - supplied in conjunction
with the templated Web site service offering.
e. Patient Advice Lines library - accessible via physician Internet
home page.
The Basic Package requires a one-year enrollment commitment by Subscriber
and is terminable upon 90 days prior written notice to the Company.
3. Plus Package - $***/month/Subscriber:
a. Online EDI Services.
b. Subscription to WebMD.
*** Omitted pursuant to a request for confidential treatment and filed
separately with the Commission.
c. Virtual Receptionist.
d. Customized Physician Internet Home Page.
e. Network Computer Hardware Package.
f. Unlimited Local Dial-up Internet Access.
g. Patient Advice Lines Library.
4. Premium Package - $***/month/Subscriber:
a. Online EDI Services.
b. Subscription to WebMD.
c. Virtual Receptionist.
d. Customized Physician Internet Home Page.
e. Network Computer Hardware Package.
f. Unlimited Local Dial-up Internet Access.
g. Patient Advice Lines Library.
h. Endeavor OnCall physician-only answering service.
The Plus and Premium Packages require a three-year enrollment
commitment by Subscriber, terminable upon 90 days written notice, with a
cancellation charge equal to $*** per month times the number of months remaining
in the original three-year contract. A one-time set-up fee of $***/Subscriber
is required for the Plus and Premium Package.
*** Omitted pursuant to a request for confidential treatment and filed
separately with the Commission.
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EXHIBIT B
SUBSCRIBER TARGETS
An aggregate of *** WebMD Subscribers enrolled by the Company on or before
December 31, 1998.
An additional *** WebMD Subscribers enrolled by the Company on or before
December 31, 1999.
An additional *** WebMD Subscribers enrolled by the Company on or before
December 31, 2000.
*** Omitted pursuant to a request for confidential treatment and filed
separately with the Commission.
EXHIBIT C
INCENTIVE COMMISSION SCHEDULE
(ONE-TIME PAYMENT PER NEW PAID SUBSCRIBER)
1. Basic Package: $***
2. Plus Package: $***
3. Premium Package: $***
*** Omitted pursuant to a request for confidential treatment and filed
separately with the Commission.
