1
EXHIBIT 10.33
CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY WITH
THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE
OMITTED PORTIONS.
May 19, 1999
Xxxx Xxxx
Chief Executive Officer
Healtheon Corporation
0000 Xxxxxxx Xxxxx Xxxxx
Xxxxx Xxxxx, XX 00000
Dear Xxxx:
This letter of agreement ("LOA") is entered into as of May 19, 1999
("Effective Date") and sets out the principal terms and objectives and
obligations of Healtheon Corporation ("Healtheon"), WebMD, Inc. ("WebMD") and
Microsoft Corporation ("Microsoft") with respect to the strategic relationship
which will exist between the parties in the event that Healtheon acquires WebMD
(with whom Microsoft has existing contractual and equity relationships),
pursuant to an Agreement and Plan of Reorganization under negotiation as of the
date of this LOA or otherwise ( the "H-W Transaction"). All of the terms set
forth in this LOA will need to be memorialized in a definitive written
agreement(s) (the "Agreement") satisfactory in form and substance to each party.
The legal obligations of each party with respect to the terms and conditions set
forth in this LOA will be solely as specified in this LOA. Each party agrees to
work together in good faith with the goal of concluding such Agreement no later
than May 30, 1999 or such other time as the parties mutually agree. This LOA
shall be legally binding until such time as the parties execute the Agreement or
such other time as the parties may mutually agree, provided that if negotiations
are terminated following the public announcement that the H-W Transaction will
not proceed, this LOA will have no legal effect.
1. DEFINITIONS.
1.1 "ASSIGNEE" means Healtheon, or in the case of a merger between
Healtheon and WebMD or some other process by which Healtheon is not the parent
company resulting from the H-W Transaction, that H-W Entity.
1.2 "HEALTHEON SITE" means the Healtheon Web site currently located
at the URL xxxx://xxx.xxxxxxxxx.xxx or any successor site(s) or version(s)
(e.g., localized for an international market, distributed to a specific user
group, etc.) thereof, including but not limited to the Healtheon Consumer Site
and the Healtheon Professionals Section.
1.3 "HEALTHEON CONSUMER SITE" shall mean that part of the Healtheon
Site currently located at the URL xxxx://xxx.xxxxxxxxx.xxx or any successor
site(s) or version(s) thereof which is directed at a consumer market.
1.4 "HEALTHEON PROFESSIONALS SECTION" shall mean that part of the
Healtheon Site currently located at the URL xxxx://xxx.xxxxxxxxx.xxx or any
successor site(s) or version(s) thereof that targets medical professional
market.
1.5 "H-W ENTITY" means the parent company resulting from the H-W
Transaction (which is expected to be Healtheon) in the event the H-W Transaction
results in a parent-subsidiary structure; otherwise, H-W Entity means the
surviving legal entity following the closing of the H-W Transaction, or the
acquiring party in the event that the H-W Transaction is structured as a
purchase of assets.
2. ASSIGNMENT OF DISTRIBUTION AND CROSS PROMOTION AGREEMENT. Healtheon,
Microsoft and WebMD agree that upon closing of the H-W Transaction and
completion of all necessary regulatory requirements (a) WebMD will
[*] CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
2
assign to the Assignee, all of WebMD's rights and obligations under the
Distribution and Cross Promotion Agreement dated as of May 7, 1999 between
Microsoft, WebMD, WebTV and MSNBC ("WebMD Agreement"), (b) the Assignee will
accept such assignment and all such obligations thereunder, except as modified
under this LOA or as otherwise agreed by Microsoft, (c) the Assignee will be
fully and solely responsible for all obligations of WebMD under the WebMD
Agreement, and (d) all references in the WebMD Agreement to WebMD will mean
Assignee and all references in this LOA to Healtheon shall mean Assignee.
Microsoft agrees to approve and secure such other agreements as are necessary to
approve (as required to satisfy the requirements of Section 18.3 of the WebMD
Agreement) such assignment by WebMD. Each party agrees to execute such documents
as are necessary to give effect to the foregoing and such in a form as mutually
agreed between the parties.
3. MODIFICATIONS TO THE WEBMD AGREEMENT. Effective upon the closing of the
H-W Transaction, the parties hereby amend the WebMD Agreement as set forth
below. In the event of any inconsistency between the provisions of the WebMD
Agreement and this LOA, the provisions of this LOA shall control:
3.1 All obligations with respect to the WebMD Site, e.g., as set
forth in Sections 3.2 (Internet Access), 3.4 (Other Microsoft Properties), and
3.5 (MSN Module) of the WebMD Agreement, as such may be modified by this LOA,
will apply to both the WebMD Site and to the Healtheon Site and any successors
or parts thereof.
3.2 With respect to and without limiting anything contained in
Section 3.3 of the WebMD Agreement, in the event that Microsoft elects to create
a combined health care-related directory for the Health Channel (as defined in
the WebMD Agreement), Healtheon's health care-related directory listings shall
also be made available for inclusion in such directory.
3.3 Without limiting anything contained in the WebMD Agreement, with
respect to any rights Microsoft, MSNBC and/or WebTV has with respect to the
WebMD Consumer Site (as defined in the WebMD Agreement), Microsoft, MSNBC and/or
WebTV shall also have such rights with respect to the Healtheon Consumer Site
(e.g., the Health Channel (as defined in the WebMD Agreement) shall include
content, features, technology and the like from the Healtheon Consumer Site)
subject to any agreements Healtheon or WebMD has with third parties in existence
as of the Effective Date. Without limiting anything contained in the WebMD
Agreement, with respect to any rights Microsoft, MSNBC and/or WebTV has with
respect to the WebMD Medical Professionals Section (as defined in the WebMD
Agreement), Microsoft, MSNBC and/or WebTV shall also have such rights with
respect to the Healtheon Professionals Section to the extent that Healtheon is
able to provide such rights under its agreements with third parties in existence
as of the Effective Date. In all agreements executed with third parties after
the Effective Date, Healtheon shall exercise best efforts to obtain the
foregoing rights for Microsoft, except that, Healtheon's obligation as set forth
in this Section 3.3 shall not apply to content, features and technology that it
may create for a custom project so long as such content, features and technology
are not included on the Healtheon Site or WebMD Site. In addition, Healtheon
will provide significant online and offline promotional opportunities
surrounding the successful positioning and launch of Healtheon's Community
Directory Services ("CDS"). CDS is defined as a regional directory and
information service comprising physicians and healthcare institutions that will
include a vehicle for health care institutions and providers to publish
information about themselves to the local community, affording them the
opportunity to interact directly with consumers; it will include the ability for
MSN-generated consumers and professionals to link to healthcare transactions on
the Healtheon website, thereby creating a transaction revenue stream for MSN.
This ability to do a locally-directed search which facilitates consumer to
physician transactions and communications will be unique to the CDS exclusively
distributed on MSN; provided, however, that Healtheon may offer the CDS on the
Healtheon Site, but may not offer or provide the CDS to any third party sites.
Within the proposed CDS, Healtheon will enable broader e-commerce capabilities
to complement the core Healtheon transaction sets. This includes linking the
participating CDS firms with a buying/selling environment for supplies, services
and goods. Participation in the broader CDS will be key to driving commerce
within the Mall area of the MSN Site and in Microsoft's discretion, within the
Mall area of the Healtheon site, which, in Microsoft's discretion, shall also be
accessible and promoted from the Health Channel or other Microsoft Internet
properties.
3.4 TRANSACTION REVENUES. In addition to those amounts set out in
the WebMD Agreement, Healtheon will pay Microsoft a royalty in consideration of
Microsoft's distribution of the Health Channel and other Healtheon consumer and
business to business services. Such royalty shall be equal to * of Healtheon
"Net Transaction Revenues" for "Electronic Transactions" that originate on the
Health Channel or other Microsoft
2
[*] CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
3
properties. "Electronic Transactions" means electronic transactions between
healthcare institutions (e.g. payers and providers) or between consumers and
healthcare institutions, and suppliers and healthcare institutions such as, but
not limited to, claims submissions, claims status inquiries and eligibility
inquiries. Electronic Transactions will include the EDI transaction set
currently processed by Healtheon and any additions to that transaction set that
Healtheon may make during the term of the WebMD Agreement. The parties will
prepare and agree upon a written schedule listing all Electronic Transactions
and update such schedule from time to time as new transactions become available.
"Net Transaction Revenues" means the gross fees paid to Healtheon for such
transactions less direct, variable expenses paid to third parties incurred to
process such transactions. Specific examples of these expenses include:
a. Commercial EDI Claim: PMS vendor transmits claim from
provider office to Healtheon; Healtheon pays PMS vendor
* for such claim; Healtheon routes claim on to
commercial insurance company; Insurance company pays
Healtheon * for such transaction. Healtheon has gross
fees for such transaction of *, direct variable expenses
paid to third parties of *, and Net Transaction
Revenues" of *.
b. Medicare EDI Claim: PMS vendor transmits claim to
Healtheon; PMS vendor pays Healtheon * to accept such
claim; Healtheon routes claim to clearinghouse;
Healtheon pays clearinghouse * to accept such claim.
Healtheon has gross fees of *, direct variable expenses
of *, and Net Transaction Revenues of *.
c. Laboratory Transaction: Provider office transmits order
for clinical lab test to Healtheon; Healtheon transmits
order to Clinical Lab; Clinical Lab transmits result to
Healtheon; Healtheon transmits results to provider.
Clinical Lab pays Healtheon *. No third party fees are
paid. Net Transaction Revenues are *.
3.5 Healtheon shall exercise best efforts to meet the obligations as
specified in the Migration Plan to be developed pursuant to Section 11 below. In
the event that Healtheon fails to meet its obligations under the preceding
sentence, Microsoft shall notify Healtheon of such failure and Healtheon shall
have a 90 day period in which to cure such failure. For purposes of this Section
3.5, "cure" shall mean that Healtheon has demonstrated substantial visible
progress toward the goals as outlined in the Migration Plan. If, at the end of
such 90 day cure period, Healtheon has failed to cure such failure, Microsoft
shall have the right to immediately suspend its obligation under Section 12.2(a)
of the WebMD Agreement to pay * until such time as Healtheon has cured such
failure (the "Suspension Period"). For each day of a Suspension Period, the
applicable Year Guarantee shall be reduced by 1/365th and such amount shall be
forfeited by Healtheon. The remedy provided for in this Section 3.5 is not meant
to waive any other rights or remedies available at law or equity.
3.6 In addition to and without limiting anything contained in
Section 2.5 of the WebMD Agreement, Healtheon agrees not to provide the CDS or
any part thereof to any third party, for distribution on the Internet, without
Microsoft's prior written consent. Further, in the event that Healtheon enters
into an agreement with any *. Nothing in this Section 3.6 is intended to prevent
Healtheon from placing advertisements on the Top Ten Portal Sites or other third
party sites. Microsoft shall have the right to distribute Healtheon's Community
Directory Service, but shall not be obligated to include it on any Other
Microsoft Properties (as defined in Section 3.12 below).
3.7 BASIC MEMBERSHIP FEE. Section 1.25 of the WebMD Agreement is
amended to read as follows:
"BASE MEMBERSHIP FEE" shall mean the lesser of (i) $29.95 per month *
3.8 WEBMD ADVERTISING/SPONSORSHIP REVENUES. The parties agree that
WebMD Advertising/Sponsorship Revenues, WebMD Upsell Revenues, and WebMD
E-Commerce Revenues do not include the Base Membership Fees (or similar
membership fees, however they may be structured in the future; provided,
however, that the definition of such membership fees may not be the same or
substantially similar to the definitions of WebMD Upsell Revenue, WebMD
E-Commerce Revenue or WebMD Advertising Sponsorship Revenues as defined in the
WebMD Agreement) paid by End User Members, or paid by Microsoft, DuPont or other
underwriters of WebMD memberships.
3
[*] CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
4
3.9 HEALTH CHANNEL REQUIREMENTS. The parties agree to the following
points of clarification, which shall override any conflicting provisions of the
WebMD Agreement:
3.9.1 Healtheon may create custom web sites or portals for its
healthcare institution customers (for example, without limitation,
providers such as Baylor Healthcare or payers such as United
Healthcare), and Healtheon will not be required to provide to Microsoft
or notify Microsoft of the content or features of such custom web sites.
Healtheon will promote Microsoft technology to its customers, including
the use of Microsoft platforms for such custom web sites. Healtheon will
advise Microsoft on the extent of Healtheon customer usage of Microsoft
technology on an aggregate basis to the best of Healtheon's knowledge.
By way of example, Healtheon will provide Microsoft with a list of names
of those customers for whom Healtheon builds such custom web sites or
portals based on Microsoft technology, including what percentage of all
custom web sites and portals built by Healtheon such customers
represent, subject to any confidentiality obligations of Healtheon.
3.9.2 In the event that Healtheon desires to offer to third
parties advertisements and sponsorships on the Health Channel, it shall
notify Microsoft of such desire and the parties shall meet to discuss
Healtheon's proposal in this regard. The parties shall agree in advance
in writing on a plan detailing agreed upon packages and sales plans for
such advertisements and sponsorships. Nothing in this Section 3.9.2 is
intended to impair or in any way diminish Microsoft's rights under
Section 6.1 of the WebMD Agreement.
3.10 INTERNATIONAL DISTRIBUTION. The parties agree that the
provisions of Section 2.3 of the WebMD Agreement apply only to markets outside
of the United States.
3.11 USER INFORMATION.
3.11.1 OWNERSHIP/USE. Microsoft and Assignee shall jointly own
any and all User Information collected by either party from Users of the
Health Channel and the party collecting such User Information will use
commercially reasonable efforts to obtain from such Users the right to
share such User Information with the other party, provided that each
such User shall in all cases be given the right to opt out of any use
(including sharing between the parties) of any of such Users' Personal
Information. Microsoft and Assignee shall jointly own any and all User
Information collected from (a) all Users of the WebMD Consumer Site and
Healtheon Consumer Site whose use of either such site originated on the
Health Channel or any MSN Site, (b) all End User Members with
Microsoft-sponsored WebMD Memberships, and (c) relating to End User
Members who receive WebMD Memberships through Microsoft or Microsoft
distribution partners, provided that they party collecting such User
Information will use commercially reasonable efforts to obtain from such
Users the right to share User Information with the other party, provided
further that (i) each such User shall in all cases be given the right to
opt out of any use (including the sharing between the parties) of any of
such Users' Personal Information. The collecting party of any such User
Information described herein shall provide such User Information to the
other party on a monthly basis in such format as reasonably requested by
such other part. As between the parties, each party may use the User
Personal Information in its possession solely for the purpose of
fulfilling the product or service for which the information was
collected and otherwise as requested by a User concerning such User's
Personal Information, provided, however, that subject to any such User
request all User Information shall be treated in the same fashion as
Confidential Information pursuant to Section 10 below and specifically,
without limitation, shall not be provided to any third party nor used on
behalf of any third party, including but not limited to, for promoting
or advertising any third party, without the other party's prior written
consent. Notwithstanding the foregoing, each party hereby approves the
other party using and providing to third parties Aggregate Information
to be used in research projects and statistical reporting. Any other use
of the User Information during the Term shall be by mutual agreement of
the parties. As between the parties, upon termination of this Agreement,
(x) each party may retain the User Information in its possession and no
party shall restrict the other's use in any way and (y) the collecting
party shall provide to the other party all User Information pertaining
to the MSN Users of the WebMD Health Communities (as defined in Section
3.7 of the WebMD Agreement).
4
[*] CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
5
3.11.2 Notwithstanding anything contained in sub-Section 3.11.1
above, (i) neither party shall be required to provide User Information
to the other party if doing so would violate the End User's
instructions, applicable laws or regulations, (ii) Healtheon will not be
required to provide to, or to attempt to obtain User consent to provide
to, Microsoft, WebTV or MSNBC any information that is subject to HIPAA
or any other law or regulation pertaining to the protection of medical
records, and (iii) subject to subsection 3.11.2(i) and (ii), Healtheon
shall use best efforts to provide Microsoft with all User Information
associated with non-medical record Internet and Web site usage, CDS,
health communities directory, and use relating to any Microsoft provided
services including but not limited to, Other Microsoft Internet
Services, Other Microsoft Properties, MSN IA, Passport, and WebMD Health
Communities.
3.11.3 Except where the parties jointly use the User
Information (and thus jointly obtain the user's permission and are
jointly responsible for such use), each party shall be responsible for
ensuring that its own use of the User Information (i) complies with all
User consent requirements, including but not limited to as provided in
Section 3.11.4 below, and (ii) complies with all applicable laws and
regulations, including concerning the security, confidentiality, use or
possession of User Information.
3.11.4 CONSENT. In addition to the foregoing, any collection,
disclosure or use of Personal Information by either party shall be
subject to the User's consent, and the business practices and User
privacy policies of the site from which it is collected (e.g., the
Health Channel, an MSN Site, WebMD Consumer Site or Medical
Professionals Section). The business practices and policies of each such
site shall permit, as their default, the collecting party to grant the
other party the rights required by this Section 3.11, unless the User
specifically requests otherwise, and in all cases shall comply with any
applicable laws governing the collection, dissemination and use thereof.
"Consent" as used in this Agreement shall mean the approval of an adult,
and in the case of minor children, the approval of the child's parent or
legal guardian. WebMD and Microsoft shall mutually agree on the Health
Channel user interface for the collection of Personal Information.
Microsoft shall determine the privacy policy for the Health Channel.
Assignee shall determine the privacy policy for the WebMD Site and
Healtheon Site.
3.12 OTHER MICROSOFT PROPERTIES. Except as prevented by any contracts
between Healtheon and third parties existing as of the Effective Date, Healtheon
agrees that Microsoft and its affiliates shall be the* provided that Healtheon
may elect in its sole discretion not to provide *. For *, if Microsoft or its
affiliates make publicly available such *. For purposes of the immediately
preceding sentence, "commercially reasonable" shall mean those situations where
Healtheon (1) has already made * and (2) has previously made a *. For New
Microsoft Properties that Microsoft or its affiliates make publicly available
after Healtheon makes publicly available *. The foregoing shall exclude,
however, any Microsoft * that are predominantly health care related, unless
mutually agreed upon by the parties. Except as prevented by any contracts in
existence as of the Effective Date, in the event that Healtheon makes available
to end users any non-web-based email technology, whether through the
distribution of work stations or otherwise, Microsoft shall be the sole provider
of such technology for such distribution and shall provide such technology under
standard terms and conditions for such distribution; provided that such
Microsoft technology be Microsoft Outlook or such other Microsoft technology
designated by Microsoft. Without limitation, being the "*" means that *
3.13 MSN MODULE. The provisions of Section 3.5 of the WebMD Agreement
do not apply to the Medical Professionals Section of the WebMD Site or Healtheon
Site.
3.14 DISTRIBUTION OF MEDICAL PROFESSIONALS SECTION. Exhibit J-1 of
the WebMD Agreement is amended by deleting * from such Exhibit. In the event
that Healtheon determines that it will outsource its data center, Healtheon
agrees that Microsoft may nominate vendors to bid on such opportunity and that
Healtheon will provide such vendors a reasonable and equal opportunity to bid.
In addition, the last sentence of Section 11.2(c) of the WebMD Agreement is
hereby modified to read as follows:
In addition, in the event that the parties mutually agree to allow a
third party to host WebMD Offerings, WebMD hereby licenses to Microsoft
and/or such third party all such rights as are necessary to permit
Microsoft and such third parties to use, copy, execute, display,
perform, distribute, transmit, and/or broadcast the agreed upon WebMD
Offerings as necessary for Microsoft and/or such third party(ies) to
host such WebMD Offerings.
5
[*] CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
6
3.15 WEBMD ADDITIONAL PAYMENTS. In order to resolve an ambiguity in
the wording of Section 12.3 of the WebMD Agreement, the parties agree that the
amount on which the * is paid under Section 12.3 is capped at the applicable *
and the * of the applicable *.
3.16 PAYMENTS FOR MICROSOFT SPONSORSHIP COMMITMENT. Section
12.4(a)(iv) of the WebMD Agreement is hereby amended to read as follows:
the amount of Distribution Payments due from WebMD to Microsoft
in accordance with Section 12.5 below.
3.17 WARRANTIES. (a) Subsection 14.1(ii) of the WebMD Agreement is
amended to read as follows:
except for those agreements identified in Exhibit F attached
hereto, it has not previously and will not grant any rights to
any third party that are inconsistent with the rights granted to
Microsoft, MSNBC and/or WebTV herein;
(b) Subsection 14.1(vii) is amended to read as follows: (vii)
the WebMD Content, to the best of WebMD's knowledge after
reasonable inquiry, is factually accurate and does not contain
any information, instruction or formula that might be injurious
to anyone's physical well-being, and that it does not, and its
use by Microsoft as permitted in this Agreement will not, defame
or disparage any third party. Notwithstanding the foregoing, the
parties acknowledge that Healtheon's failure to review content
provided by Healtheon or WebMD for accuracy (including, but not
limited to, medical content) shall not constitute a breach of
this Section 14.1(vii); provided, however, that nothing in this
Section 14.1(vii) is intended to, nor shall it, in any way
lessen or otherwise impact Healtheon's warranty or
indemnification obligations set forth in Section 14.3 below.
3.18 CONTENT SPECIFICATIONS. It is understood that the provisions of
Exhibit A-1 of the WebMD Agreement do not apply to the Medical Professionals
Section of the WebMD Site or Healtheon Site.
4. MICROSOFT ONLINE ID PROGRAM. Healtheon agrees to test, evaluate, and
use, take sign ups for and accept the IDs for Microsoft's proprietary
authentication service ("Microsoft Passport") on both the Health Channel (as
provided in the WebMD Agreement) and on the Healtheon Site and the WebMD Site,
and all of WebMD's existing profiling and authentication mechanisms will also
take sign ups for and accept the IDs for Passport. Healtheon shall use Microsoft
Passport in accordance with the terms of the then-current Microsoft Online ID
Evaluation Program Agreement attached hereto as Exhibit A and such further
standard terms and conditions that are offered from time to time in addition to
or as a replacement for those currently contained in such agreement. The parties
acknowledge and agree that Healtheon may accept other authentication mechanisms
on the Healtheon Site and WebMD Site. Healtheon agrees, however, that Microsoft
Passport will be the only authentication mechanism distributed (i.e., take sign
ups) on the Health Channel (as provided in the WebMD Agreement) and on the
Healtheon Consumer Site and WebMD Consumer Site other than any Healtheon
proprietary authentication mechanisms existing as of the Effective Date or as
mutually agreed between the parties. Healtheon's obligations under this Section
4 shall extend to any localized WebMD Consumer Site, to the extent that a
localized version of Passport is available for the relevant market. In the event
that Healtheon reasonably believes that Microsoft Passport does not meet its
reasonable quality and service standards, or that it fails to comply with
identified legal requirements, Healtheon shall notify Microsoft of the details
of such concerns and Microsoft shall have ninety days in which to resolve such
concerns. In the event that Passport does not meet such reasonable quality and
service standards or Microsoft determines, in its sole discretion, that it is
not commercially reasonable to modify Passport in such a manner as to resolve
such concerns, then Healtheon shall be permitted to distribute and accept other
mechanisms for the purposes identified in Healtheon's notice to Microsoft on the
WebMD Site or the Healtheon Site.
5. OTHER MICROSOFT INTERNET SERVICES. Except as prevented by any contracts
between Healtheon and third parties existing as of the Effective Date, upon
notice from Microsoft that any such service or technology is available for
distribution, Healtheon agrees, as soon as commercially feasible, to prominently
implement on the Healtheon Site, and prominently provide end users with access
from the Healtheon Site to, each Microsoft Internet service and
6
[*] CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
7
technology that is available on the MSN Site as of the Effective Date,
including, but not limited to services and technologies included within the
Other Microsoft Properties, a Microsoft business, e-commerce, communication
service and technology, which includes a common format and process for
exchanging products, business information, promotional information and other
business data over the Internet, and a Microsoft web hosting service and
technology, which includes software and tools that enable web site creation and
hosting, and all other Microsoft Internet services not otherwise specifically
addressed in other Sections of this Agreement that are available on the MSN Site
as of the Effective Date ("Other Microsoft Internet Services") pursuant to
Microsoft's standard user interface and distribution terms. For services or
technologies not included in the Other Microsoft Internet Services ("New
Microsoft Internet Services"), if Microsoft or its affiliates make publicly
available such services or technology before Healtheon, Healtheon agrees that,
where commercially reasonable, Microsoft and its affiliates shall be the sole
providers of such New Microsoft Internet Services for the Healtheon Site and
WebMD Site. For purposes of the immediately preceding sentence, "commercially
reasonable" shall mean those situations where Healtheon (1) has already made
substantial progress toward an alternate solution and (2) has previously made a
significant investment in or contractual commitment to that alternative
solution. For New Microsoft Internet Services that Microsoft or its affiliates
make publicly available after Healtheon makes publicly available substantially
similar services or technology, Microsoft and its affiliates shall be the sole
providers of such new Microsoft Internet Services for the Healtheon Site and
WebMD Site only upon mutual agreement of the parties. To such end, Microsoft
shall provide Healtheon with such materials, technology and support as it
routinely provides to other third parties distributing such technologies. In the
event that Healtheon offers Other Microsoft Internet Services or New Microsoft
Internet Services on the Healtheon Site in accordance with the foregoing,
Healtheon shall not promote any competing technology on the Healtheon Site,
other than during a commercially reasonable transition period for discontinuing
any such promotion. Healtheon's obligations under this Section 5 are subject to
Healtheon's contractual obligations existing as of the Effective Date, and shall
extend to any version of the Healtheon Site localized for any international
market and to any version(s) of the Healtheon Site, to the extent that a
localized version of any Other Microsoft Internet Service(s) or New Microsoft
Internet Service(s) is available for the relevant market. Healtheon shall
develop, maintain, and host that which is necessary and reasonably requested by
Microsoft to implement the services and technologies specified in this Section
5. Upon mutual agreement, the parties shall work together and with appropriate
third parties to create appropriate industry standards.
6. SECURE MESSAGING AND NOTIFICATION SERVICES. The parties agree that
within thirty days of the Effective Date, they will meet to discuss and
determine whether to create a mutually agreed plan pursuant to which they will
pursue opportunities for Healtheon in the following areas: (i) offering of
Healtheon's secure messaging service to HotMail users; and (ii) joint
development and provision of notification services (e.g., schedule an
appointment, prescription refill reminders) to Health Channel users, including
integration of such services into other MSN properties such as personalization
services and Hotmail.
7. MICROSOFT ADCU OBJECTIVES.
7.1 PRESS RELEASE. Consistent with the technology and platform
commitments made in the WebMD Agreement, simultaneously with the announcement of
the H-W Transaction or at such other time as Microsoft and Healtheon mutually
agree, Microsoft and Healtheon will jointly develop a public press release
announcing Healtheon's long-term commitment to Microsoft's technology and
platform and articulating the benefits of building a healthcare portal and
transaction solution on Microsoft technology. In addition, Healtheon agrees to
issue additional subsequent press releases and public announcements pertaining
to successes or milestones of events utilizing Microsoft technology no less
frequently than once per quarter or as otherwise mutually agreed between the
parties, provided that such releases shall be at a time and in a form mutually
agreed between the parties.
7.2 ISV INTEGRATION. Understanding that Microsoft currently works
with over 460 healthcare independent software vendors ("ISVs"), Microsoft and
Healtheon agree to cooperate in good faith to develop a plan ("Plan 1") for
integrating existing ISV applications and systems for transaction processing
into the Healtheon solution for health care (including but not limited to use of
the Healtheon Site and Healtheon healthcare transaction solutions) (i.e., to
make compatible with the back end Healtheon technology). The Plan 1 will be
completed within thirty (30) days of the Effective Date and will incorporate the
following components:
7.2.1 A clear value proposition to ISVs that positions
Healtheon, to the extent reasonably possible consistent with Healtheon's
business plan, as a healthcare web portal providing content, community, and
7
[*] CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
8
services. In the event that Microsoft reasonably determines that * is contrary
to the parties' goals and intent with regard to the ISVs under the WebMD
Agreement and this Agreement, * The parties shall have a *. The preceding
sentence shall not impact Microsoft's * set out below if the parties are unable
to resolve the conflict within the 45-day period. *
7.2.2 A tiered approach to the market based on the ISVs value
to Healtheon and Microsoft moving forward.
7.2.3 A mutually agreed upon list of the top ISVs in the
acute, ambulatory, and payor segments and PMS vendors.
7.2.4 The details of a road show where both Healtheon and
Microsoft meet with each of the agreed strategic ISVs to present the value
proposition and obtain ISV commitments.
7.2.5 A rapid integration methodology (outlined in the Section
11 below (MCS and Technology Commitments)) that provides value to the ISVs
moving forward.
7.2.6 A detailed joint Microsoft and Healtheon proposal to be
presented to the ISVs regarding how to integrate the Healtheon solution for
healthcare (including but not limited to use of the Healtheon Site and Healtheon
healthcare transaction solutions) into the ISVs' line of business applications
and offering the ISVs a Microsoft software subscription model to the extent that
it exists that can be resold by the ISVs within their respective client bases.
Such detailed joint proposal shall at a minimum include a description of the
Healtheon Integration Platform ("HIP"). No later than the completion of the work
outlined in the Migration Plan described in Section 11, HIP shall be based on
the Microsoft Technology Platform and the Microsoft Healthcare Interoperability
Framework. The scope of HIP includes: (I) Webtop integration framework for
integrating third-party info-services (addresses issues such as common login,
context-sharing, personalization etcetera); (II) secure messaging standard;
(III) common document distribution framework; (IV) common role-based security
and authentication model; (V) data exchange interface for back-end integrations
with third-party systems such as PMS, MCS, Payor, Membership, Lab, PBM and HRIS
systems; (VI) standard mechanism for interfacing with other EDI gateways; (VII)
data standards for administrative and clinical information; and (VIII)
middleware-level integration standard. Microsoft will work with Healtheon to
include HIP as relevant in Microsoft's other standards initiatives. Microsoft
will promote interfacing to Healtheon's Internet transaction services through
the Microsoft COM-based interfaces to be included in HIP, at such time as such
interfaces are completed to the parties' reasonable satisfaction, as a
healthcare industry standard means for ISVs to web enable their applications
with Healtheon.
7.2.7 Participation by both parties in the development of
standard interface library(ies) for ISVs, legacy systems, etc. to support broad
industry positioning. To that end, Healtheon shall adopt, and Microsoft and
Healtheon will work together to promote and establish HIP and the Microsoft
Healthcare Interoperability Framework (as defined in the WebMD Agreement). The
Microsoft Healthcare Interoperability Framework is a multilevel standard
designed to provide interoperability between applications and systems across
desktops PCs, servers, networks, and legacy systems in the healthcare industry.
The Microsoft Healthcare Interoperability Framework includes the Active X for
Healthcare standard and BizTalk (which together include components of COM, DCOM,
COM+, and XML or other enhancements).
7.2.8 Participation by both parties in an ISV advisory board
or steering committee which will include representatives of the top (measured in
terms of physician distribution commitment) four ISVs that use and promote the
Healtheon Site.
Plan 1 will provide at a minimum for calls to be made to the ISVs listed in
Exhibit B. Microsoft will position the Healtheon solution for healthcare
(including but not limited to use of the Healtheon Site and Healtheon healthcare
transaction solutions) as a broad electronic health ("E-Health") strategy that
provides healthcare content, community, and services and will use reasonable
efforts to encourage its major ISV alliance partners to develop and integrate
key distributed applications based on Microsoft technologies that would operate
in conjunction with the functionality and content of the Healtheon Site.
Healtheon will do such things as are commercially reasonable to permit existing
ISVs to integrate their applications into the Healtheon solution for health care
(including but not limited to integration into the Healtheon Site and Healtheon
healthcare transaction solutions).
8
[*] CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
9
7.3 MICROSOFT PRODUCT LICENSING COMMITMENT. Healtheon will agree to
work with Microsoft in establishing a mutually agreed upon plan ("Plan 2") with
respect to potentially incorporating a Microsoft software subscription model
into its overall service offering. This Plan 2 shall include a definition of the
products involved (i.e. IE, MSN, Office, BackOffice), pricing methodologies, as
well as specific mechanics for deployment and periodic reporting to ADCU of
sales influenced by Healtheon. This Plan 2 will be completed within thirty (30)
days of the Effective Date. Plan 2 will include new subscription model pricing,
if available, for Healtheon customers and a commission structure to incent
Healtheon to distribute Microsoft software.
7.4 LIMITATIONS. Subject to contracts in existence as of the
Effective Date, during the Term of this LOA and the Agreement, Healtheon shall
not, directly or indirectly, *. Subject to contracts in existence as of the
Effective Date, during the Term of this LOA and the Agreement, if Healtheon,
directly or indirectly, *. Healtheon shall keep Microsoft reasonably informed
regarding all Healtheon Offerings planned or under development, subject to
confidentiality requirements and obligations to third parties. The foregoing
sentence does not apply to custom developments for Healtheon customers. For the
purposes of this Agreement, "Healtheon Offering" means any co-branded or third
party-branded Internet, intranet, broadcast or other electronic offering of
health-related content, features, services, or technology that incorporates all
or portions of the Healtheon Site. In addition, in the event that the parties
mutually agree to allow a third party to host Healtheon Offerings, Healtheon
hereby licenses to Microsoft and/or such third party all such rights as are
necessary to permit Microsoft and such third parties to use, copy, execute,
display, perform, distribute, transmit, and/or broadcast the agreed upon
Healtheon Offerings as necessary for Microsoft and/or such third party(ies) to
host such Healtheon Offerings.
8. BOARD REPRESENTATION. As part of its equity stake in Healtheon,
Microsoft will be entitled to nominate one member of the Healtheon Board of
Directors. At its next meeting of shareholders, Healtheon's board shall
recommend to its shareholders the election of a nominee designated by Microsoft
(the "Microsoft Designee") to the Healtheon Board of Directors. Further, upon
the expiration of the Microsoft Designee's term, or the resignation of the
Microsoft Designee from the Board of Directors, Healtheon's board shall
recommend the election of the Microsoft Designee (or any substitute identified
by Microsoft) at the next meeting of its shareholders following such expiration
or resignation. In addition, Microsoft will have the right to designate one
board observer.
9. HEALTHEON MANAGEMENT. The parties acknowledge and agree that it is
anticipated that Xxxx Xxxx will the Chairman and Chief Operating Officer of the
H-W Entity, and that Xxxx Xxxxxx will be the Chief Executive Officer of the H-W
Entity.
10. OTHER RIGHTS. From time to time, in the event Healtheon receives *.
11. MCS AND TECHNOLOGY COMMITMENTS.
11.1 MICROSOFT TECHNOLOGY PLATFORM. Section 1.11 of the WebMD
Agreement is amended to read as follows:
"MICROSOFT TECHNOLOGY PLATFORM" shall mean those Microsoft technologies
commonly referred to as: Microsoft Windows, Microsoft Office, Microsoft
BackOffice and any of its components, Microsoft Commerce Server,
Microsoft Visual Studio and COM, including any updates and upgrades
thereto released during the term.
11.2 ADOPTION AND USE OF MICROSOFT TECHNOLOGY PLATFORM. Healtheon
agrees to make the Microsoft Technology Platform Healtheon's primary platform
for the development of all new services, defined as those Healtheon services not
in existence or under development as of the Effective Date. However, there will
be well-defined quality of service checkpoints in the development timeline to
address any issues with respect to the ability of the Microsoft Technology
Platform to meet commercial readiness standards for quality, functionality and
reliability.
11.3 MIGRATION OF EXISTING SERVICES. Healtheon will migrate its
existing services to the Microsoft Technology Platform in carefully planned
phases. As part of the MCS engagement referenced in Section 11.4 below,
Healtheon and Microsoft will mutually agree on a phased migration plan which
will be based on, without limitation, the following: quality, functionality and
reliability of the applicable Microsoft technology; the business
9
[*] CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
10
ramifications to Healtheon and its customers of the migration; and the degree
and manageability of the risks involved (the "Migration Plan"). Healtheon and
Microsoft will develop and agree on a detailed Migration Plan no later than 90
days immediately following the Effective Date. The Migration Plan will include,
at a minimum, the Healtheon services selected as candidates for migration, an
anticipated migration schedule, Healtheon's anticipated internal use needs for
Microsoft software products, and the estimated costs of migrating the selected
services. The parties expect initially to migrate one service at a time and
anticipate that migration of all selected services could require up to three
years, but in any event, all migration of services shall be completed no later
than three years from the Effective Date. The Migration Plan will include
regular quality of service checkpoints to ensure that the applicable technology
meets the agreed upon requirements for quality, functionality and reliability.
The primary components of the Migration Plan will be jointly reviewed and
revised as necessary at meetings between the parties held no less often than
quarterly. Healtheon shall make best efforts to meet the requirements of the
Migration Plan, including without limitation, the anticipated schedule and cost
estimate.
11.4 MCS ENGAGEMENT. No later than thirty days immediately following
the Effective Date, Healtheon agrees to execute the Microsoft Master Services
Agreement ("MSA") attached hereto as Exhibit D, pursuant to which it will engage
all Microsoft Consulting Services ("MCS") and Microsoft Premier Support Services
as provided for under this Agreement. Healtheon agrees to engage MCS to
undertake development of the Migration Plan identified in Section 11.3 above, as
further set forth in the MSA and MCS work order ("Work Order") attached hereto
as Exhibit D. Any and all MCS services to be engaged by Healtheon pursuant to
this Agreement and/or the WebMD Agreement shall be set forth in a Work Order
pursuant to the MSA, which Work Order shall be mutually agreed upon and executed
by the parties prior to the commencement of any such MCS services.
11.5 COST OF MIGRATION. Microsoft will provide financial assistance
for Healtheon's migration to Microsoft technology as follows:
11.5.1 * Microsoft will support Healtheon's adoption of the
Microsoft Technology Platform for internal use by providing, * certain
Microsoft software licenses as set forth in Exhibit G attached hereto
and any other Microsoft software licenses reasonably required and agreed
between the parties. Such software shall be used solely for internal
development purposes and internal use and not for use in Healtheon's
production environment or operations. Microsoft's obligation to provide
such software licenses is expressly subject to and conditioned on
Healtheon's purchase of maintenance for such software licenses during
the Term, as follows. No later than 90 days immediately following the
Effective Date, Healtheon will execute a Microsoft Enterprise Select
Agreement or Microsoft Select Agreement (the "Enterprise Agreement")
pursuant to which it will acquire the software licenses and maintenance
as provided in this Section 11.5.1. Healtheon acknowledges and agrees
that for any initial licenses that Microsoft provides during the first
year of the term of this Agreement, Healtheon shall purchase maintenance
as provided in the Enterprise Agreement for a minimum period of three
years. In the event that, at Healtheon's request, Microsoft agrees to
provide additional software licenses *during the second or third year of
the term, Healtheon shall purchase maintenance under the Enterprise
Agreement for such additional licenses for a minimum of two years from
the date on which Microsoft grants any such license. Additional licenses
granted in year three of the term will, subject to the purchase of the
relevant maintenance by Healtheon pursuant to the Enterprise Agreement,
be enrolled under either (i) the Enterprise Agreement as extended into a
fourth year or (ii) a new mutually agreed Select or Open License
Agreement, providing in either case for maintenance for such licenses
for a minimum of two years from the date on which Microsoft grants any
such license.
11.5.2 *. To the extent that prior to the Effective Date
Healtheon has * that it will no longer be able * as a result of the
requirements and obligations of this Agreement *, Microsoft agrees to *
In addition, to the extent that after the Effective Date and before the
completion of the migration at the end of the third year of the term,
Healtheon is required to * Microsoft shall *. Microsoft's * under this
Section 11.5.2 shall be subject to mutual agreement by the parties of *.
11.5.3 HARDWARE AND TRAINING. Subject to all applicable legal
restrictions, Microsoft shall exercise best efforts to work with
Healtheon to provide it with access to the favorable discounts available
from hardware suppliers with whom Microsoft has ongoing business
relationships. Microsoft shall exercise best efforts to assist Healtheon
in establishing relationships with Microsoft Certified Technical
10
[*] CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
11
Education Centers ("CTECs") to assist Healtheon in obtaining favorable
discounts for training services related to Microsoft software products.
11.5.4 MCS CONSULTANT EXPENSE. The parties agree that the
dollar limit of * as provided in Section 4.4 of the WebMD Agreement
shall be increased to *. All other terms and conditions of Section 4.4
shall remain the same.
11.5.5 OTHER FUNDING. Microsoft will make funding available to
Healtheon during the first three years of the term in an amount not to
exceed *. If it is mutually agreed that additional funding is required,
Microsoft will make up to an additional * available during such period.
The parties currently anticipate that part of such amount shall be
available to Healtheon in each of the first two years of the term.
Beginning on the third anniversary of the Effective Date, Healtheon will
begin to *, that will enable Microsoft to * under this Section 11.5.5,
*, no later than the fifth anniversary of the Effective Date.
Microsoft's obligation to provide any funding under this Section 11.5.5
is expressly subject to and conditioned upon the parties reaching mutual
agreement on the terms and conditions of a funding plan within sixty
days immediately following the Effective Date. Failure to agree on the
terms of funding as provided for in this Section 11.5.5 shall not in any
way impact or alleviate Healtheon's other obligations under this LOA.
Other key terms of the funding plan shall include:
o If Microsoft terminates the WebMD Agreement and/or this
LOA due to a breach by Healtheon, Healtheon will, within
30 days of the date of termination, provide the
aggregate amount of the funding back to Microsoft *.
o The funding relationship shall not be assigned without
Microsoft's prior written consent. In the event the
relationship is assigned without Microsoft's consent,
Healtheon will, within 30 days of the date of
assignment, provide the aggregate amount of the funding
back to Microsoft *.
o The parties will *, at the end of the third or fourth
year of the term, that Microsoft will * the end of the
fifth year of the term.
o Microsoft agrees to work with Healtheon to provide the
most favorable accounting treatment. Healtheon's
obligations covered under this Section 11 are not
conditional on this Section 11.5.5 to the extent that
Microsoft and Healtheon cannot agree on the funding
terms as principally outlined above in this Section
11.5.5.
11.6 MICROSOFT PREMIER SUPPORT. No later than thirty days immediately
following the Effective Date, Healtheon shall purchase Microsoft Premier Support
Services for Developers, Level B, pursuant to the terms of the MSA at standard
rates for such services. Healtheon shall maintain such Premier support services
at least at the level specified in this Section 11.6 for a minimum period of
three years.
11.7 To the extent that any of the provisions of this Section 11 are
inconsistent or conflict with the provisions of Section 4 of the WebMD
Agreement, the parties agree that the terms of this Section 11 shall control.
12. GENERAL TERMS AND CONDITIONS
12.1 PROPRIETARY RIGHTS. Each party agrees that except as expressly
licensed to another party, each party shall retain all right, title, and
interest in any and all materials it delivers to any other party for use under
this LOA or the Agreement and no other party shall alter, modify, copy, edit,
format, translate, create derivative works of or otherwise use any materials,
content, feature or technology, etc. without express written approval. If any
parties agree to jointly develop any content, materials, services, technology,
features or otherwise, ownership of such development shall be specifically
detailed in an appropriate agreement prior to the start of any development.
12.2 CONFIDENTIALITY. Each party acknowledges and agree that the
terms and conditions of the Microsoft Corporation Non-Disclosure Agreement dated
as of even date herewith ("NDA"), attached hereto as Exhibit E, is incorporated
into this Agreement and that all of the terms of this LOA and of the Agreement
(including but not limited to its existence) and all discussions and
negotiations related thereto are considered Confidential
11
[*] CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
12
Information as defined in the NDA. In the event that any of the incorporated
terms of the NDA are inconsistent with or conflict with this Agreement, then the
terms of this Agreement shall control.
12.3 TRADEMARKS. Any use of a party's names, brands or logo(s) shall
be pursuant to appropriate agreements and guidelines regarding such use.
12.4 DISTRIBUTION OF CONTENT AND MSN INTERNET TECHNOLOGIES.
Healtheon's distribution of any Microsoft, WebTV or MSNBC content and the MSN
Internet Technologies shall be pursuant to appropriate agreements and guidelines
regarding such distribution.
12.5 PRODUCTS OR SERVICES DELIVERED UNDER THE TERMS OF THIS AGREEMENT
SHALL BE SUBJECT TO THE TERMS OF THE LIMITED WARRANTY STATEMENT, IF ANY,
SPECIFIED BY THE DELIVERING PARTY FOR THE SPECIFIC PRODUCT OR SERVICE. CERTAIN
SOFTWARE PRODUCTS MAY BE PROVIDED TO THE OTHER PARTY "AS IS" WITHOUT WARRANTY OR
CONDITION OF ANY KIND, IF SO DESIGNATED BY THE LICENSOR. FOR SUCH PRODUCTS, THE
ENTIRE RISK AS TO THE RESULTS AND PERFORMANCE OF SUCH SOFTWARE IS ASSUMED BY THE
RECEIVING PARTY AND ITS CUSTOMERS AND SUBLICENSEES, IF ANY. THE WARRANTIES SET
FORTH IN SECTIONS IN THIS SECTION 12.6 OR ELSEWHERE IN THIS LOA OR THE AGREEMENT
ARE THE ONLY WARRANTIES MADE BY THE PARTIES. EACH PARTY DISCLAIMS ANY AND ALL
OTHER WARRANTIES OR REPRESENTATION EXPRESS OR IMPLIED, INCLUDING, BUT NOT
LIMITED TO, THE IMPLIED WARRANTIES OF MERCHANTABILITY, TITLE, AND FITNESS FOR A
PARTICULAR PURPOSE. NO PARTY WARRANTS THAT ACCESS TO OR USE OF THE SITES OR
CHANNELS WILL BE UNINTERRUPTED OR ERROR-FREE, OR THAT ANY SOFTWARE OR SERVICES
WILL MEET ANY PARTICULAR CRITERIA OF PERFORMANCE OR QUALITY.
12.6 LIMITATION OF LIABILITIES. NO PARTY SHALL BE LIABLE TO THE OTHER
FOR ANY INDIRECT, INCIDENTAL, CONSEQUENTIAL, PUNITIVE OR SPECIAL DAMAGES,
ARISING OUT OF OR RELATED TO THIS AGREEMENT INCLUDING, WITHOUT LIMITATION,
DAMAGES FOR LOSS OF BUSINESS PROFITS, BUSINESS INTERRUPTION, LOSS OF BUSINESS
INFORMATION, AND THE LIKE, EVEN IF SUCH PARTY HAS BEEN ADVISED OF THE
POSSIBILITY OF SUCH DAMAGES. THIS SECTION SHALL NOT APPLY TO ANY PARTY'S (A)
ABILITY TO OBTAIN INJUNCTIVE OR OTHER EQUITABLE RELIEF; (B) OBLIGATIONS UNDER
SECTION 10 OR THE NDA; AND (C) INDEMNIFICATION OBLIGATIONS UNDER SECTION 14.
12.7 INSURANCE. Healtheon shall procure and during the Term maintain
such insurance in a form and with insurers reasonably acceptable to Microsoft,
as is required by Microsoft, which shall in no event be less than that required
of WebMD under the WebMD Agreement.
12.8 INDEPENDENT CONTRACTORS. The parties are independent contractors
with respect to each other, and nothing in this LOA or the Agreement shall be
construed as creating an employer-employee relationship, a partnership, agency
relationship or a joint venture between the parties.
12.9 GOVERNING LAW. This LOA and the Agreement shall be governed by
the laws of the State of New York as though entered into by New York residents
and to be performed entirely within the State of New York. The parties consent
to exclusive jurisdiction and venue in the state and federal courts sitting in
New York. In any action or suit to enforce any right or remedy under this
Agreement or to interpret any provision of this Agreement, the prevailing party
shall be entitled to recover its costs, including reasonable attorneys' fees.
12.10 ASSIGNMENT. No party may transfer, assign or sublicense this LOA
or the Agreement, or any rights and/or obligations hereunder, whether by
contract or by operation of law, except with the express written consent of the
other parties, and any attempted transfer, assignment or sublicense by a party
in violation of this Section shall be void and shall constitute a material
default and breach of this Agreement.
12.11 CONSTRUCTION. In the event that any provision of this LOA or the
Agreement conflict with governing law or if any provision is held to be null,
void or otherwise ineffective or invalid by a court of competent jurisdiction,
(i) such provision shall be deemed to be restated to reflect as nearly as
possible the original intentions of
12
[*] CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
13
the Parties in accordance with applicable law, and (ii) the remaining terms,
provisions, covenants and restrictions of this LOA or the Agreement shall remain
in full force and effect. This LOA or the Agreement has been negotiated by the
parties and their respective counsel and will be interpreted fairly in
accordance with its terms and without any strict construction in favor of or
against any party.
12.12 NOTICES. All notices and requests in connection with this
Agreement shall be given in writing and shall be deemed given as of the day they
are received either by messenger, delivery service, or in the United States of
America mail, postage prepaid, certified or registered, return receipt
requested, and addressed as follows:
To Microsoft: To Healtheon:
Microsoft Corporation Healtheon Corporation
One Microsoft Way 0000 Xxxxxxx Xxxxx Xxxxx
Xxxxxxx, XX 00000-0000 Xxxxx Xxxxx, XX 00000
Phone: 000.000.0000 Phone: 000.000.0000
Fax: 000.000.0000 Fax: 000.000.0000
Attention: Attention: Chief Executive Officer
Copy to: Law & Corporate Affairs, Copy to: General Counsel
US Legal
Fax: 000.000.0000 Fax: 000.000.0000
or to such other address as a party may designate pursuant to this notice
provision.
12.13 ENTIRE AGREEMENT. This LOA and the Agreement shall not be
effective until signed by both parties. This LOA constitutes the entire
agreement between the parties with respect to the subject matter hereof,
supersedes all prior and contemporaneous agreements or communications and shall
not be superceded except by execution of the Agreement. This LOA shall not be
modified except by a written agreement dated subsequent to the date of this LOA
and signed on behalf of by each party by their respective duly authorized
representatives. No waiver of any breach of any provision of this LOA shall
constitute a waiver of any prior, concurrent or subsequent breach of the same or
any other provisions hereof, and no waiver shall be effective unless made in
writing and signed by an authorized representative of the waiving party.
13
[*] CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
14
If the foregoing is acceptable to you, please execute it where indicated
below.
Very truly yours,
Xxxxx Xxxxxxxx
Vice President
Microsoft Corporation
ACKNOWLEGED AND AGREED
HEALTHEON CORPORATION.
By
Name (Print)
Title
Date
WEBMD, INC.
By
Name (Print)
Title
Date
14
[*] CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
