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EXHIBIT 10.2
TRANSITION SERVICES AGREEMENT
TRANSITION SERVICES AGREEMENT (this "Agreement"), dated as of ________,
2001, by and between InfoCure Corporation, a Delaware corporation ("InfoCure"),
and PracticeWorks, Inc., a Delaware corporation ("PracticeWorks").
WHEREAS, PracticeWorks is an indirect wholly owned subsidiary of
InfoCure;
WHEREAS, InfoCure and PracticeWorks have entered into an Agreement and
Plan of Distribution, dated as of _________, 2001 (the "Distribution
Agreement"), pursuant to which InfoCure will transfer certain assets to
PracticeWorks and PracticeWorks will assume certain liabilities of InfoCure;
WHEREAS, in connection with the transactions contemplated by the
Distribution Agreement, InfoCure and PracticeWorks wish to enter into this
Agreement;
WHEREAS, by this Agreement, the parties desire to confirm their
agreement with respect to services to be provided to each other commencing on
the Distribution Date, and to set forth the basis for the provision of further
services of the type referred to herein;
WHEREAS, PracticeWorks is able and willing to provide the specified
services to InfoCure, and InfoCure desires to engage PracticeWorks as an
independent contractor to provide the same in accordance with the terms set
forth herein; and
WHEREAS, InfoCure is able and willing to provide the specified services
to PracticeWorks, and PracticeWorks desires to engage InfoCure as an independent
contractor to provide the same in accordance with the terms set forth herein.
NOW, THEREFORE, in consideration of the foregoing and the mutual
agreements, provisions and covenants contained herein, and for other good and
valuable consideration, the receipt and legal sufficiency whereof are hereby
acknowledged, the parties hereto further agree as follows:
ARTICLE I.
DEFINITIONS
"Additional Services" shall have the meaning set forth in Article III
of this Agreement.
"Agreement" shall have the meaning set forth in the preamble to this
Agreement.
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"Agreement Disputes" shall have the meaning set forth in Section 11.1
of this Agreement.
"Applicable Rate" shall mean the rate of interest per annum announced
from time to time by SunTrust Bank, N.A. as its prime lending rate plus 4% per
annum.
"Bankruptcy Event" with respect to a party shall mean the filing of an
involuntary petition in bankruptcy or similar proceeding against such party
seeking its reorganization, liquidation or the appointment of a receiver,
trustee or liquidator for it or for all or substantially all of its assets,
whereupon such petition shall not be dismissed within sixty (60) days after the
filing thereof, or if such party shall (i) apply for or consent in writing to
the appointment of a receiver, trustee or liquidator of all or substantially all
of its assets, (ii) file a voluntary petition or admit in writing its inability
to pay its debts as they become due, (iii) make a general assignment for the
benefit of creditors, (iv) file a petition or an answer seeking reorganization
or an arrangement with its creditors or take advantage of any insolvency law
with respect to itself as debtor, or (v) file an answer admitting the material
allegations of a petition filed against it in any bankruptcy, reorganization,
insolvency proceedings or any similar proceedings;
"Business Day" shall mean any day other than a Saturday, a Sunday or a
day on which commercial banking institutions in Atlanta, Georgia are authorized
or obligated by law or executive order to close.
"Change in Control" of a party shall mean (i) a change in the
composition of the board of directors of such party (other than a change due to
the death or disability of a member of the board of directors) such that at the
end of any period of twelve (12) consecutive months a majority of the persons
constituting such board of directors were not directors at the start of such
period and were not elected by vote of a majority of the directors who were
directors at the start of such period), (ii) the sale or other disposition by
such party of all or substantially all of the assets of such party (other than a
bona fide pledge in connection with a financing), or (iii) a merger,
consolidation or other business combination involving such party, which results
in the stockholders of such party immediately prior to such event owning less
than 50% of the capital stock of the surviving entity;
"Charges" shall have the meaning set forth in Section 4.1 of this
Agreement.
"Distribution" shall mean the distribution of the outstanding common
stock of PracticeWorks to the stockholders of InfoCure.
"Distribution Agreement" shall have the meaning set forth in the
recitals to this Agreement.
"Distribution Date" shall mean such date as may be determined by the
Board of Directors of InfoCure, or such committee of such Board of Directors as
shall be designated by the Board of Directors of InfoCure, as the record date
for the Distribution.
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"Employee Benefits and Compensation Allocation Agreement" shall mean
the Employee Benefits and Compensation Allocation Agreement by and between
InfoCure and PracticeWorks, which agreement shall be entered into prior to or on
the Distribution Date in the form attached as Exhibit B to the Distribution
Agreement.
"Fees" shall mean, collectively, the Charges, Variable Fees and Fixed
Fees.
"Fixed Fees" shall mean the PracticeWorks Fixed Fees and the InfoCure
Fixed Fees.
"Indemnifying Party" shall have the meaning set forth in Section 7.3(a)
of this Agreement.
"Indemnitee" shall have the meaning set forth in Section 7.3(a) of this
Agreement.
"InfoCure" shall have the meaning set forth in the preamble to this
Agreement.
"InfoCure Fees" shall mean the InfoCure Variable Fees and the InfoCure
Fixed Fees.
"InfoCure Fixed Fees shall have the meaning set forth in Section 4.3.2
of this Agreement.
"InfoCure Services" shall have the meaning set forth in Section 2.2 of
this Agreement.
"InfoCure Variable Fees" shall have the meaning set forth in Section
4.2.2 of this Agreement.
"Loss" shall mean any damage, claim, loss, charge, action, suit,
proceeding, deficiency, tax, interest, penalty and reasonable costs and expenses
(including reasonable attorneys' fees).
"Management Services" shall mean the PracticeWorks Services and the
InfoCure Services.
"Person" shall mean any natural person, corporation, business trust,
limited liability company, joint venture, association, company, partnership or
government, or any agency or political subdivision thereof.
"PracticeWorks" shall have the meaning set forth in the preamble to
this Agreement.
"PracticeWorks Fees" shall mean the PracticeWorks Variable Fees and the
PracticeWorks Fixed Fees.
"PracticeWorks Fixed Fees" shall have the meaning set forth in Section
4.2.1 of this Agreement.
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"PracticeWorks Services" shall have the meaning set forth in Section
2.1 of this Agreement.
"PracticeWorks Variable Fees" shall have the meaning set forth in
Section 4.3.1 of this Agreement.
"Reimbursed Party" shall have the meaning set forth in Section 4.1 of
this Agreement.
"Reimbursing Party" shall have the meaning set forth in Section 4.1 of
this Agreement.
"Rules" shall have the meaning set forth in Section 11.3 of this
Agreement.
"Services" shall mean, collectively, the Management Services and, if
agreed to provide the Additional Services, the Additional Services.
"Tax Disaffiliation Agreement" shall mean the Tax Disaffiliation
Agreement by and between InfoCure and PracticeWorks, which agreement shall be
entered into prior to or on the Distribution Date in the form attached as
Exhibit C to the Distribution Agreement.
"Third Party Claim" shall have the meaning set forth in Section 7.3(a)
of this Agreement.
"Variable Fees" shall mean the PracticeWorks Variable Fees and the
InfoCure Variable Fees.
ARTICLE II.
MANAGEMENT SERVICES
SECTION 2.1 PROVISION OF SERVICES BY PRACTICEWORKS. Commencing on the
Distribution Date, InfoCure hereby engages and retains PracticeWorks to provide
or otherwise make available to InfoCure the services described in this Section
2.1 (collectively, the "PracticeWorks Services"), and PracticeWorks hereby
accepts and agrees to provide the PracticeWorks Services to InfoCure, for the
term and consideration as specified herein. The fee payable for the
PracticeWorks Services shall be determined in accordance with Article IV of this
Agreement.
SECTION 2.1.1 TAX SERVICES. Subject to the applicable
provisions of the Tax Disaffiliation Agreement, PracticeWorks shall
provide InfoCure with the following tax services: preparation of
federal income tax returns; preparation of state and local tax returns
(including income tax returns); business license renewals; property tax
returns; filing of state sales and other state tax returns; preparation
of financial statement disclosures and calculation of tax provisions
for financial statement purposes; conducting negotiations with tax
authorities as necessary; and providing tax research and planning and
assistance with respect to federal, state and local audits initiated
during the term of this Agreement. The tax services described in this
Section 2.1.1 shall be provided by PracticeWorks until terminated
pursuant to the provisions of Article IX hereof. Upon termination of
such services for any reason, PracticeWorks shall provide to InfoCure
copies of its records relating to federal, state and local tax
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returns filed by or on behalf of InfoCure, and all other correspondence
and documentation reasonably required by InfoCure relating to payment
of its taxes.
SECTION 2.1.2 ACCOUNTING SERVICES. PracticeWorks shall provide
InfoCure with the following accounting services: maintenance of
InfoCure's general ledger; maintenance of InfoCure's accounts payable
and accounts receivable records; Form 1099 preparation;
employee-incurred expense reimbursement services; and maintenance of
InfoCure's fixed asset records and treasury and cash management
services. Such services shall also include information services
support, including account maintenance and reporting support, access to
the on-line intranet reporting tools, access to SofTrax (or its
equivalent), access to sales commission database software services and
sales commission database support, and continued remote access
availability to PracticeWorks' corporate databases. The services
described in this Section 2.1.2 shall also be provided by PracticeWorks
at the request of InfoCure in connection with InfoCure's preparation of
financial statements and any required filings with the Securities and
Exchange Commission pursuant to federal securities laws. The services
described in this Section 2.1.2 shall be provided by PracticeWorks
until terminated pursuant to the provisions of Article IX hereof.
SECTION 2.1.3 CORPORATE RECORD-KEEPING SERVICES. PracticeWorks
shall maintain all past tax, accounting and payroll records relating to
InfoCure, until such time as such records shall be disposed of in
accordance with applicable legal requirements and PracticeWorks' normal
record disposition policies. PracticeWorks shall give InfoCure thirty
(30) days' prior written notice of its intention to dispose of such
records and shall provide InfoCure with the opportunity to retain the
same.
SECTION 2.1.4 PAYROLL SERVICES. Until terminated pursuant to
the provisions of Article IX hereof, PracticeWorks shall provide
InfoCure with payroll services, including payment processing by an
outside vendor; Form W-2 preparation; assistance with any required
regulatory compliance in connection with any payroll services provided
pursuant to this Section 2.1.4; and distribution and maintenance of the
InfoCure employee database. Upon termination of such services,
PracticeWorks shall provide InfoCure with all payroll records for
InfoCure employees, including information for calendar year 2000.
SECTION 2.1.5 INFORMATION TECHNOLOGY SERVICES. Until
terminated pursuant to the provisions of Article IX hereof,
PracticeWorks shall provide InfoCure with information technology
services as such services are requested, including assistance with,
installation of, and maintenance of InfoCure's telephonic and computer
equipment, including maintaining infrastructure related to WAN T-1
lines, LAN connections, related server and end-user hardware helpdesk
support and Telecom T-1's. In addition, PracticeWorks will provide to
InfoCure support and maintenance for Softrax, ConnectCare, helpdesk
end-user application support and telecom application support.
SECTION 2.1.6 CORPORATE OFFICE SERVICES. PracticeWorks shall
maintain the corporate facilities, including utilities, cleaning,
security, maintenance and repairs, procurement of office supplies, mail
and transportation services. In addition, PracticeWorks shall provide
to InfoCure switchboard operators and receptionist services.
SECTION 2.2 PROVISION OF SERVICES BY INFOCURE. Commencing on the
Distribution Date, PracticeWorks hereby engages and retains InfoCure to provide
or otherwise make available to PracticeWorks the services described in this
Section 2.2 (collectively, the "InfoCure Services"), and InfoCure hereby accepts
and agrees to provide the InfoCure Services to PracticeWorks, for the term and
consideration as specified herein. The fee payable for the InfoCure Services
shall be determined in accordance with Article IV of this Agreement.
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SECTION 2.2.1. INSURANCE SERVICES. InfoCure shall from and
after the Distribution Date continue in force the then existing
liability, property, casualty, indemnity and other business insurance
policies applicable to PracticeWorks as a division or subsidiary of
InfoCure. All of such insurance coverage shall be maintained by
InfoCure until the respective termination dates of the current policies
in effect with respect thereto. Thereafter, until terminated pursuant
to Article IX of this Agreement, InfoCure shall provide or cause to be
provided to PracticeWorks insurance in such amount and on such terms as
are customary for businesses such as PracticeWorks.
SECTION 2.2.2. EMPLOYEE BENEFITS SERVICES. Subject to the
applicable provisions of the Employee Benefits and Compensation
Allocation Agreement, from and after the Distribution Date until
terminated pursuant to the provisions of Article IX hereof, InfoCure
shall provide administrative services with respect to the following
benefit plans: medical, dental, vision, life, accidental, death and
dismemberment and long-term disability insurance programs. Upon
termination of the administrative services provided under this Section
2.2.2, InfoCure shall provide PracticeWorks with such information and
records as are reasonably requested by PracticeWorks to enable it to
administer the benefit plans in which its employees are enrolled from
and after the Distribution Date.
SECTION 2.2.3 INFORMATION TECHNOLOGY SERVICES. Until
terminated pursuant to the provisions of Article IX hereof, InfoCure
shall provide PracticeWorks with information technology services as
such services are requested, including assistance with, installation
of, and maintenance of PracticeWorks' telephonic and computer
equipment.
ARTICLE III.
ADDITIONAL SERVICES
Beginning on such date or dates subsequent to the Distribution Date as
are mutually agreed to in writing by the parties, InfoCure and its corporate
staff, or PracticeWorks and its corporate staff, will provide or otherwise make
available to the other party to this Agreement, such services in addition to
those described in Article II hereof as are reasonably requested by
PracticeWorks or InfoCure, subject in each case to the parties' agreement to
financial consideration and other terms (the "Additional Services"). In the
event that either party desires to avail itself of any of such Additional
Services, the parties shall negotiate in good faith to reach agreement on the
scope and term of such services. When and if an agreement is reached, the
parties shall prepare an appropriate schedule or addendum to this Agreement, in
which the nature, scope and quality of such services is described in detail.
Each such addendum shall be executed on behalf of each party hereto, shall be
effective as of its date and shall, upon the Distribution Date, be incorporated
into and made an integral part of this Agreement.
ARTICLE IV.
REIMBURSEMENT OF EXPENSES
SECTION 4.1 REIMBURSEMENT GENERALLY. In connection with the Management
Services pursuant to Article II hereof and Additional Services pursuant to
Article III hereof, each party (the "Reimbursing Party") shall reimburse the
other party (the "Reimbursed Party") for any and all out-of-pocket expenses or
costs (collectively, the "Charges") incurred or paid by the Reimbursed Party on
behalf of the Reimbursing Party in the performance of any of its
responsibilities under this Agreement (including an appropriate allocation for
overhead and general and administrative costs).
SECTION 4.2 VARIABLE FEES.
SECTION 4.2.1 PRACTICEWORKS VARIABLE FEES. Unless InfoCure and
PracticeWorks shall agree in writing to a different arrangement,
InfoCure shall pay to PracticeWorks a
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fee(s) (collectively, the "PracticeWorks Variable Fees") for the
PracticeWorks Services described in Section 2.1.4 of this Agreement in
an amount equal to the following formulation: (i) the overall amount of
expenses and costs attributable to PracticeWorks' provision of such
Management Services on a company-wide basis, including provision of
such services to InfoCure, (ii) multiplied by a fraction, (A) the
numerator of which shall be the number of employees employed by
InfoCure and its subsidiaries as of the end of each monthly period and
(B) the denominator of which shall be the number of employees employed
by PracticeWorks and its subsidiaries, plus the number of employees
employed at InfoCure, as of the end of each monthly period. (By way of
example only, if the overall expenses and costs attributable to
PracticeWorks' payroll services are $20,000 for a monthly period, and
PracticeWorks has 9,800 employees, and InfoCure has 200 employees, the
Variable Fee payable by InfoCure to PracticeWorks for such monthly
period for accounting services shall be 20,000 x 200/10,000, which
equals a Variable Fee for this monthly period for accounting services
of $400.)
SECTION 4.2.2 INFOCURE VARIABLE FEES. Unless InfoCure and
PracticeWorks shall agree in writing to a different arrangement,
PracticeWorks shall pay to InfoCure a fee(s) (collectively, the
"InfoCure Variable Fees") for the InfoCure Services described in
Section 2.2.2 of this Agreement in an amount equal to the following
formulation: (i) the overall amount of expenses and costs attributable
to InfoCure's provision of such Management Services on a company-wide
basis, including provision of such services to PracticeWorks, (ii)
multiplied by a fraction, (A) the numerator of which shall be the
number of employees employed by PracticeWorks and its subsidiaries as
of the end of each monthly period and (B) the denominator of which
shall be the number of employees employed by InfoCure and its
subsidiaries (excluding PracticeWorks), plus the number of employees
employed at PracticeWorks, as of the end of each monthly period.
SECTION 4.3 FIXED FEES.
SECTION 4.3.1 PRACTICEWORKS FIXED FEES. Unless PracticeWorks
and InfoCure shall agree in writing to a different arrangement,
InfoCure shall pay to PracticeWorks a monthly fee(s) (collectively, the
"PracticeWorks Fixed Fees") for the PracticeWorks Services described in
Sections 2.1.1, 2.1.2, 2.1.3 and 2.1.5 of this Agreement in an amount
that is fixed for each calendar year prior to January 1 of that year.
The Fixed Fees for 2001 shall be as set forth on Schedule A attached
hereto. The Fixed Fees shall be based on an estimate of the overall
amount of expenses and costs attributable to PracticeWorks' provision
of such services to InfoCure.
SECTION 4.3.2 INFOCURE FIXED FEES. Unless InfoCure and
PracticeWorks shall agree in writing to a different arrangement,
PracticeWorks shall pay to InfoCure a monthly fee(s) (collectively, the
"InfoCure Fixed Fees") for the InfoCure Services described in Sections
2.2.1 and 2.2.3 of this Agreement in an amount that is fixed for each
calendar year prior to January 1 of that year. The Fixed Fees for 2001
shall be as set forth on Schedule A attached hereto. The Fixed Fees
shall be based on an estimate of the overall amount of expenses and
costs attributable to InfoCure's provision of such services to
PracticeWorks.
SECTION 4.4 TAXES. InfoCure shall pay any applicable sales or use taxes
payable with respect to the PracticeWorks Fees and PracticeWorks shall pay any
applicable sales or use taxes payable with respect to the InfoCure Fees.
SECTION 4.5 PREPARATION OF REPORTS. PracticeWorks shall, as and when
necessary, prepare all applications, reports, statements and other documents
showing the Charges, Fees and the related costs and expenses incurred or paid by
PracticeWorks on behalf of InfoCure in the performance of any of its
responsibilities under this Agreement. InfoCure shall, as and when necessary,
prepare all applications, reports, statements and other documents showing the
Charges, Fees and the related costs and expenses incurred or paid by InfoCure on
behalf of PracticeWorks in the performance of any of its responsibilities under
this Agreement.
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SECTION 4.6 PAYMENT GENERALLY. To the extent that either party is
billed by an outside provider directly, such party shall pay such xxxx directly.
If either party is billed by outside providers for services performed for the
other party pursuant to this Agreement, the party receiving the xxxx may pay the
xxxx and charge the other party the amount of the xxxx or forward the xxxx to
the other party for payment by such other party. A Fee will be payable on all
amounts paid in connection with services provided hereunder, regardless of
whether InfoCure or PracticeWorks paid such amounts; provided, however, that to
the extent that either party uses an outside provider directly for any services
within the scope of this Agreement, such party shall not be liable to the other
party for a Fee relating to such services.
SECTION 4.8 TIME OF PAYMENT. Amounts payable by either party for
services provided under this Agreement shall be payable from and after the first
day of the month following the month in which the Distribution Date occurs.
Variable Fees shall be payable 30 days from submission of a xxxx and Fixed Fees
shall be due on the first day of every month.
ARTICLE V.
DISCLAIMER; LIMITED LIABILITY
SECTION 5.1 DISCLAIMER. Each party shall provide the Management
Services (and, if it agrees to provide the Additional Services, the Additional
Services) with substantially the same degree of care as it employs in making the
same services available for its own operations; provided, however, that neither
party shall be liable to the other party or any other person for any loss,
damage or expense which may result therefrom or from any change in the manner in
which such party renders such services, so long as such party deems such change
necessary or desirable in the conduct of its own operations.
SECTION 5.2 LIMITED LIABILITY. Neither InfoCure nor any of its
officers, directors or agents who provide services to PracticeWorks shall be
liable to PracticeWorks or to any third party, including any governmental agency
or PracticeWorks' stockholders, for any claims, damages or expenses relating to
the InfoCure Services (and, if it agrees to provide the Additional Services,
Additional Services) provided pursuant to this Agreement, except for willful
malfeasance, bad faith or gross negligence in the performance of their duties or
reckless disregard of their obligations and duties under the terms of this
Agreement. Neither PracticeWorks nor any of its officers, directors or agents
who provide services to InfoCure shall be liable to InfoCure or to any third
party, including any governmental agency or InfoCure's stockholders, for any
claims, damages or expenses relating to the PracticeWorks Services (and, if it
agrees to provide the Additional Services, Additional Services) provided
pursuant to this Agreement, except for willful malfeasance, bad faith or gross
negligence in the performance of their duties or reckless disregard of their
obligations and duties under the terms of this Agreement.
ARTICLE VI.
LICENSES AND PERMITS.
Each party warrants and covenants that all duties and obligations
(including all Services) to be performed hereunder shall be performed in
compliance with all material applicable federal, state, provincial and local
laws, rules and regulations. Each party shall obtain and maintain all material
permits, approvals and licenses necessary or appropriate to perform its duties
and obligations (including all Services) hereunder and shall at all times comply
with the terms and conditions of such permits, approvals and licenses.
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ARTICLE VII.
INDEMNIFICATION.
SECTION 7.1 INDEMNIFICATION BY PRACTICEWORKS. PracticeWorks agrees to
indemnify, defend and hold InfoCure harmless from and against any Loss to which
InfoCure may become subject arising out of, by reason of or otherwise in
connection with the provision hereunder by InfoCure of the InfoCure Services,
other than Losses resulting from InfoCure's willful malfeasance, bad faith or
gross negligence in the performance of their duties or reckless disregard of
their obligations and duties under the terms of this Agreement. PracticeWorks
further agrees to indemnify, defend and hold InfoCure harmless from and against
any Loss to which InfoCure may become subject arising out of, reason of or
otherwise in connection with the provision hereunder by PracticeWorks of
PracticeWorks Services to InfoCure where such Losses resulted from
PracticeWorks' willful malfeasance, bad faith or gross negligence in the
performance of their duties or reckless disregard of their obligations and
duties under the terms of this Agreement. Notwithstanding any provision in this
Agreement to the contrary, PracticeWorks shall not be liable under this Section
7.1 for any consequential, special or punitive damages (including but not
limited to lost profits), except to the extent that such consequential, special
or punitive damages relate to a Loss resulting from a Third Party Claim (as
defined below).
SECTION 7.2 INDEMNIFICATION BY INFOCURE. InfoCure agrees to indemnify,
defend and hold PracticeWorks harmless from and against any Loss to which
PracticeWorks may become subject arising out of, by reason of or otherwise in
connection with the provision hereunder by PracticeWorks of the PracticeWorks
Services, other than Losses resulting from PracticeWorks' willful malfeasance,
bad faith or gross negligence in the performance of their duties or reckless
disregard of their obligations and duties under the terms of this Agreement.
InfoCure further agrees to indemnify, defend and hold PracticeWorks harmless
from and against any Loss to which PracticeWorks may become subject arising out
of, reason of or otherwise in connection with the provision hereunder by
InfoCure of InfoCure Services to PracticeWorks where such Losses resulted from
InfoCure's willful malfeasance, bad faith or gross negligence in the performance
of their duties or reckless disregard of their obligations and duties under the
terms of this Agreement. Notwithstanding any provision in this Agreement to the
contrary, InfoCure shall not be liable under this Section 7.2 for any
consequential, special or punitive damages (including but not limited to lost
profits), except to the extent that such consequential, special or punitive
damages relate to a Loss resulting from a Third Party Claim (as defined below).
SECTION 7.3 THIRD PARTY CLAIMS. (a) If a claim or demand is
made against PracticeWorks or InfoCure (each, an "Indemnitee") by any
Person who is not a party to this Agreement (a "Third Party Claim") as
to which such Indemnitee is entitled to indemnification pursuant to
this Agreement, such Indemnitee shall notify the party which is or may
be required pursuant to Section 7.1 or Section 7.2 hereof to make such
indemnification (the "Indemnifying Party") in writing, and in
reasonable detail, of the Third Party Claim promptly (and in any event
within fifteen (15) Business Days) after receipt by such Indemnitee of
written notice of the Third Party Claim; provided, however, that
failure to give such notification shall not affect the indemnification
provided hereunder except to the extent the Indemnifying Party shall
have been actually prejudiced as a result of such failure (except that
the Indemnifying Party shall not be liable for any expenses incurred
during the period in which the Indemnitee failed to give such notice).
Thereafter, the Indemnitee shall deliver to the Indemnifying Party,
promptly (and in any event within ten (10) Business Days) after the
Indemnitee's receipt thereof, copies of all notices and documents
(including court papers) received by the Indemnitee relating to the
Third Party Claim.
(b) If a Third Party Claim is made against an Indemnitee, the
Indemnifying Party shall be entitled to participate in the defense
thereof and, if it so chooses and acknowledges in writing its
obligation to indemnify the Indemnitee therefor, to assume the defense
thereof with counsel selected by the Indemnifying Party; provided that
such counsel is not reasonably objected to by the Indemnitee. Should
the Indemnifying Party so elect to assume the defense of a Third Party
Claim, the Indemnifying Party shall, within thirty (30) days (or sooner
if the nature of the Third Party Claim so requires), notify the
Indemnitee of its intent to do so, and the Indemnifying Party shall
thereafter not be liable to the Indemnitee for legal or other expenses
subsequently incurred by the Indemnitee in connection with the defense
thereof; provided, that such Indemnitee shall have the right to employ
counsel to represent such Indemnitee if, in such Indemnitee's
reasonable judgment, a conflict of interest between such Indemnitee and
such Indemnifying Party exists in respect of such claim which would
make representation of both such parties by one counsel
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inappropriate, and in such event the fees and expenses of such separate
counsel shall be paid by such Indemnifying Party. If the Indemnifying
Party assumes such defense, the Indemnitee shall have the right to
participate in the defense thereof and to employ counsel, subject to
the proviso of the preceding sentence, at its own expense, separate
from the counsel employed by the Indemnifying Party, it being
understood that the Indemnifying Party shall control such defense. The
Indemnifying Party shall be liable for the fees and expenses of counsel
employed by the Indemnitee for any period during which the Indemnifying
Party has failed to assume the defense thereof (other than during the
period prior to the time the Indemnitee shall have given notice of the
Third Party Claim as provided above). If the Indemnifying Party so
elects to assume the defense of any Third Party Claim, all of the
Indemnitees shall cooperate with the Indemnifying Party in the defense
or prosecution thereof, including by providing or causing to be
provided agreements, documents, books, records, files and witnesses as
soon as reasonably practicable after receiving any request therefor
from or on behalf of the Indemnifying Party.
(c) If the Indemnifying Party acknowledges in writing
responsibility under this Section 7.3 for a Third Party Claim, then in
no event will the Indemnitee admit any liability with respect to, or
settle, compromise or discharge, any Third Party Claim without the
Indemnifying Party's prior written consent; provided, however, that the
Indemnitee shall have the right to settle, compromise or discharge such
Third Party Claim without the consent of the Indemnifying Party if the
Indemnitee releases the Indemnifying Party from its indemnification
obligation hereunder with respect to such Third Party Claim and such
settlement, compromise or discharge would not otherwise adversely
affect the Indemnifying Party. If the Indemnifying Party acknowledges
in writing liability for a Third Party Claim, the Indemnitee will agree
to any settlement, compromise or discharge of a Third Party Claim that
the Indemnifying Party may recommend and that by its terms obligates
the Indemnifying Party to pay the full amount of the liability in
connection with such Third Party Claim and releases the Indemnitee
completely in connection with such Third Party Claim and that would not
otherwise adversely affect the Indemnitee. If an Indemnifying Party
elects not to assume the defense of a Third Party Claim, or fails to
notify an Indemnitee of its election to do so as provided herein, such
Indemnitee may compromise, settle or defend such Third Party Claim.
(d) Notwithstanding the foregoing, the Indemnifying Party
shall not be entitled to assume the defense of any Third Party Claim
(and shall be liable for the fees and expenses of counsel incurred by
the Indemnitee in defending such Third Party Claim) if the Third Party
Claim seeks an order, injunction or other equitable relief or relief
for other than money damages against the Indemnitee which the
Indemnitee reasonably determines, after conferring with its counsel,
cannot be separated from any related claim for money damages. If such
equitable relief or other relief portion of the Third Party Claim can
be so separated from that for money damages, the Indemnifying Party
shall be entitled to assume the defense of the portion relating to
money damages.
(e) In the event of payment by an Indemnifying Party to any
Indemnitee in connection with any Third-Party Claim, such Indemnifying
Party shall be subrogated to and shall stand in the place of such
Indemnitee as to any events or circumstances in respect of which such
Indemnitee may have any right or claim relating to such Third-Party
Claim against any claimant or plaintiff asserting such Third-Party
Claim. Such Indemnitee shall cooperate with such Indemnifying Party in
a reasonable manner, and at the cost and expense of such Indemnifying
Party, in prosecuting any subrogated right or claim.
(f) The remedies provided in this Section 7.3 shall be
cumulative and shall not preclude assertion by any Indemnitee of any
other rights or the seeking of any and all other remedies against any
Indemnifying Party.
SECTION 7.4 INDEMNIFICATION PAYMENTS. (a) Indemnification
required by this Article VII shall be made by periodic payments of the
amount thereof during the course of the investigation or defense, as
and when bills are received or any Loss is incurred. If the
Indemnifying Party fails to make an indemnification payment required by
this Section 7.4 within thirty (30) days after receipt of a xxxx
therefore or notice that a loss, liability, claim, damage or expense
has been incurred, the Indemnifying
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Party shall also be required to pay interest on the amount of such
indemnification payment, from the date of receipt of the xxxx or notice
of the Loss to, but not including the date of payment, at the
Applicable Rate.
(b) The amount of any claim by an Indemnitee under this
Agreement shall be reduced to reflect any actual tax savings received
by any Indemnitee that result from the Indemnifiable Losses that gave
rise to such indemnity.
SECTION 7.5 SURVIVAL. The parties' obligations under this Article VII
shall survive the termination of this Agreement.
ARTICLE VIII.
CONFIDENTIALITY
Each party shall keep confidential all information received from the
other party regarding the subject matter of this Agreement, including, without
limitation, any information received with respect to products of InfoCure or
PracticeWorks, and to use such information only for the purposes set forth in
this Agreement unless otherwise agreed to in writing by the party from which
such information was received. The covenants in this Article VIII shall survive
any termination of this Agreement for a period of three (3) years from the date
such termination becomes effective.
ARTICLE IX.
TERM AND TERMINATION
SECTION 9.1 TERM. Except as expressly provided in this Article IX, the
initial term of this Agreement shall commence on the Distribution Date and
continue through the end of December 31, 2001. This Agreement shall
automatically renew at the end of the initial term for successive one-year terms
until terminated in accordance with Section 9.2 hereof.
SECTION 9.2 TERMINATION GENERALLY. This Agreement may be terminated at
any time upon mutual consent by the parties.
SECTION 9.3 TERMINATION OF SPECIFIC SERVICES. Any Management Service
specified in Article II hereof may be terminated by the party receiving the
Management Service at any time on 60 days' prior written notice to the other
party provided, however, that in no event may any Management Services be
terminated before February 28, 2001 except as set forth in Sections 9.4 and 9.5.
Specific services provided hereunder may be terminated, or shall expire, as
described in Article II hereof or in any schedule or addendum hereto. If and to
the extent that either party incurs expenses in connection with and resulting
from termination of any specific services provided hereunder, the other party
shall reimburse such party for such costs or expenses promptly upon receipt of
an itemized account thereof.
SECTION 9.4 EARLY TERMINATION BY INFOCURE. InfoCure may terminate this
Agreement by giving written notice to PracticeWorks under the following
circumstances:
(a) if PracticeWorks shall default in the performance of any
of its material obligations under, or breach any of its warranties set
forth in, this Agreement, and such default or breach shall continue and
not be remedied for a period of five (5) Business Days with respect to
any payment obligations hereunder (including without limitation any
payment obligations pursuant to Article IV) or a period of thirty (30)
days with respect to any other obligations hereunder, after InfoCure
has given written notice to PracticeWorks specifying such default or
breach and requiring it to be remedied;
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(b) if a Bankruptcy Event has occurred with respect to
PracticeWorks;
(c) upon the occurrence of a Change in Control of
PracticeWorks; or
(d) if PracticeWorks should assign or subcontract, or attempt
to assign or subcontract, any interest in all or any part of this
Agreement without the prior written consent of InfoCure, except as set
forth in Section 12.13.
SECTION 9.5 EARLY TERMINATION BY PRACTICEWORKS. PracticeWorks may
terminate this Agreement by giving written notice to InfoCure under the
following circumstances:
(a) if InfoCure shall default in the performance of any of its
material obligations under, or breach any of its warranties set forth
in, this Agreement, and such default or breach shall continue and not
be remedied for a period of five (5) Business Days with respect to any
payment obligations hereunder (including without limitation any payment
obligations pursuant to Article IV) or a period of thirty (30) days
with respect to any other obligations hereunder, after PracticeWorks
has given written notice to InfoCure specifying such default or breach
and requiring it to be remedied;
(b) if a Bankruptcy Event has occurred with respect to
InfoCure;
(c) upon the occurrence of a Change in Control of InfoCure;
or
(d) if InfoCure should assign or subcontract, or attempt to
assign or subcontract, any interest in all or any part of this
Agreement without prior written consent of PracticeWorks, except as set
forth in Section 12.13.
SECTION 9.6 POST-TERMINATION SERVICES. In the event of termination of
this Agreement, or a service provided hereunder, pursuant to Section 9.2 hereof,
the party providing the service shall be required at the other parties' option
to continue to provide the terminated services of the type then being provided
during the 60-day period referred to in Section 9.3 hereof and, whether or not
the other party requests continuation of such services, it shall continue to pay
the party providing the service the costs of such services for such 60-day
period. Subsequent to such 60-day period, or in the event of termination of this
Agreement pursuant to Section 9.4 or 9.5, corporate administrative services of
the kind provided under the Agreement may continue to be provided on an
as-requested basis, in which event the party receiving the services shall be
charged by the other party a fee equal to the market rate for comparable
services charged by third-party vendors. Such fee will be charged quarterly and
payable within thirty (30) days. The obligations set forth in this Section 9.6
shall survive the termination of this Agreement.
ARTICLE X.
RECORDS.
Each of the parties shall create and maintain full and accurate books
in connection with the provision of the Services, and all other records relevant
to this Agreement, and upon reasonable notice from the other party shall make
available for inspection and copy by such other party's agents such records
during reasonable business hours.
ARTICLE XI.
DISPUTE RESOLUTION.
SECTION 11.1 NEGOTIATION. In the event of a controversy, dispute or
claim arising out of, in connection with, or in relation to the interpretation,
performance, nonperformance, validity or breach of this Agreement or otherwise
arising out of, or in any way related to this Agreement or the transactions
contemplated
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hereby, including, without limitation, any claim based on contract, tort,
statute or constitution (but excluding any controversy, dispute or claim arising
out of any agreement relating to the use or lease of real property if any Third
Party is a party to such controversy, dispute or claim) (collectively,
"Agreement Disputes"), the management of the parties shall negotiate in good
faith for a reasonable period of time to settle such Agreement Dispute, provided
such reasonable period shall not, unless otherwise agreed by the parties in
writing, exceed thirty (30) days from the time the parties began such
negotiations; provided, further, that in the event of any mediation or
arbitration in accordance with Sections 11.2 and 11.3 hereof, the parties shall
not assert the defenses of statute of limitations and laches arising for the
period beginning after the date the parties began negotiations hereunder, and
any contractual time period or deadline under this Agreement or any Ancillary
Agreement to which such Agreement Dispute relates shall not be deemed to have
passed until such Agreement Dispute has been resolved.
SECTION 11.2 MEDIATION. If after such reasonable period such management
are unable to settle such Agreement Dispute (and in any event, unless otherwise
agreed in writing by the parties, after sixty (60) days have elapsed from the
time the parties began such negotiations) and the Agreement Dispute involves a
controversy, dispute or claim of less than $500,000, such Agreement Dispute
shall be determined, at the request of any party, by binding mediation conducted
in Wilmington, Delaware or at another location which the parties mutually
select, before a retired judge sitting on the panel of Judicial Arbitration &
Mediation Services, Inc. The mediation process shall continue as the exclusive
method of resolving the Agreement Dispute (other than negotiation between the
parties) until the earlier of the Agreement Dispute being resolved and the
mediator finding in good faith that all settlement possibilities have been
exhausted and that the matter is not resolvable through mediation. If the
mediator makes such a finding, at the request of any party, the Agreement
Dispute shall then be determined by binding arbitration in accordance with
Section 11.3 hereof.
SECTION 11.3 ARBITRATION. If after such reasonable period such
management are unable to settle such Agreement Dispute (and in any event, unless
otherwise agreed in writing by the parties, after sixty (60) days have elapsed
from the time the parties began such negotiations) and the Agreement Dispute
involves a controversy, dispute or claim of $500,000 or more, such Agreement
Dispute shall be determined, at the request of any party, by binding arbitration
conducted in Wilmington, Delaware or at another location which the parties
mutually select, before and in accordance with the then-existing International
Arbitration Rules of the American Arbitration Association (the "Rules"). In any
dispute between the parties hereto, the numbers of arbitrators shall be three.
Any judgment or award rendered by the arbitrator shall be final, binding and
nonappealable (except upon grounds specified in 9 U.S.C. Section 10(a) as in
effect on the date hereof). If the parties are unable to agree on an arbitrator
or arbitrators, the arbitrator or arbitrators shall be selected in accordance
with the Rules. Any controversy concerning whether an Agreement Dispute is an
arbitrable Agreement Dispute, whether arbitration has been waived, whether an
assignee of this Agreement is bound to arbitrate, or as to the interpretation of
enforceability of this Article XI shall be determined by the arbitrator or
arbitrators. In resolving any dispute, the parties intend that the arbitrator or
arbitrators apply the substantive laws of the State of Delaware, without regard
to the choice of law principles thereof. The parties intend that the provisions
to arbitrate set forth herein be valid, enforceable and irrevocable. The parties
agree to comply with any award made in any such arbitration proceedings that has
become final in accordance with the Rules and agree to enforcement of or entry
of judgment upon such award, by any court of competent jurisdiction, including
(a) the state courts of the State of Delaware, located in the City of
Wilmington, or (b) the United States District Court for the District of
Delaware, in accordance with Section 12.15 hereof. The arbitrator or arbitrators
shall be entitled, if appropriate, to award any remedy in such proceedings,
including, without limitation, monetary damages, specific performance and all
other forms of legal and equitable relief; provided, however, the arbitrator or
arbitrators shall not be entitled to award punitive damages. Without limiting
the provisions of the Rules, unless otherwise agreed in writing by or among the
parties or permitted by this Agreement, the undersigned shall keep confidential
all matters relating to the arbitration or the award, provided such matters may
be disclosed (i) to the extent reasonably necessary in any proceeding brought to
enforce the award or for entry of a judgment upon the award and (ii) to the
extent otherwise required by Law. Nothing contained herein is intended to or
shall be construed to prevent any party, in accordance with Article 22(3) of the
Rules or otherwise, from applying to any court of competent jurisdiction for
interim measures or other provisional relief in connection with the subject
matter of any Agreement Disputes.
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SECTION 11.4 CONTINUITY OF SERVICE AND PERFORMANCE. Unless otherwise
agreed in writing, the parties will continue to provide service and honor all
other commitments under this Agreement and each Ancillary Agreement during the
course of dispute resolution pursuant to the provisions of this Article XI with
respect to all matters not subject to such dispute, controversy or claim.
SECTION 11.5 OTHER REMEDIES. Nothing in this Article XI shall limit the
right that any party may otherwise have to seek to obtain (a) preliminary
injunctive relief in order to preserve the status quo pending the resolution of
a dispute or (b) temporary or permanent injunctive relief from any breach of any
provisions of this Agreement.
ARTICLE XII.
MISCELLANEOUS.
SECTION 12.1 STATUS OF THE PARTIES. PracticeWorks shall be deemed to be
an independent contractor and, except as expressly provided or authorized in
this Agreement, shall have no authority to act for or represent InfoCure.
InfoCure shall be deemed to be an independent contractor and, except as
expressly provided or authorized in this Agreement, shall have no authority to
act for or represent PracticeWorks.
SECTION 12.2 OTHER ACTIVITIES. Each party hereby recognizes that the
other party now renders and may continue to render management and other services
to other companies that may or may not have policies and conduct activities
similar to those of such party. Each party shall be free to render such advice
and other services, and the other party hereby consents thereto. Each party
shall devote so much of its time and attention to the performance of its duties
under this Agreement as it deems reasonable or necessary to perform the services
required hereunder in a manner consistent with that in which such services have
been performed by such party in the past.
SECTION 12.3 NOTICES. All notices and other communications hereunder
shall be in writing and shall be delivered by hand or mailed by registered or
certified mail (return receipt requested) or transmitted by facsimile to the
parties at the following addresses (or at such other addresses for a party as
shall be specified by like notice) and shall be deemed delivered upon personal
delivery, upon actual receipt or on the third business day after deposit in the
mail:
If to InfoCure:
InfoCure Corporation.
000 Xxxxx Xxxxx Xxxxxxx
Xxxxxxxxxx, XX 00000
Attention: General Counsel
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
With a copy to:
King & Spalding
000 Xxxxxxxxx Xx., X.X.
Xxxxxxx, Xxxxxxx 00000
Attention: Xxxx X. Xxxxxx III
Telephone: (000) 000-0000
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Facsimile: (000) 000-0000
To PracticeWorks:
0000 Xxx Xxxxxxxx
Xxxxx 000
Xxxxxxx, Xxxxxxx 00000
Attention: Corporate Secretary
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
SECTION 12.4 FORCE MAJEURE. Neither party shall be in default of this
Agreement or liable to the other party for any delay or default in performance
where occasioned by any cause of any kind or extent beyond its control,
including but not limited to, armed conflict or economic dislocation resulting
therefrom; embargoes; shortages of labor, raw materials, production facilities
or transportation; labor difficulties; civil disorders of any kind; action of
any civil or military authorities (including priorities and allocations); fires;
floods; and accidents. The dates on which the obligations of a party are to be
fulfilled shall be extended for a period equal to the time lost by reason of any
delay arising directly or indirectly from:
(a) Any of the foregoing causes, or
(b) Inability of that party, as a result of causes beyond its
reasonable control, to obtain instruction or information from the other
party in time to perform its obligations by such dates.
SECTION 12.5 ENTIRE AGREEMENT. This Agreement constitutes the entire
understanding between the parties with respect to the subject matter hereof and
all prior agreements or understandings shall be deemed merged herein. No
representations, warranties and certifications, express or implied, shall exist
as between the parties except as stated herein.
SECTION 12.6 WAIVERS, MODIFICATIONS, AMENDMENTS. Any provision of this
Agreement may be amended or waived if, and only if, such amendment or waiver is
in writing and signed, in the case of an amendment, by PracticeWorks, on the one
hand, and InfoCure, on the other hand, or in the case of a waiver, by the party
against whom the waiver is to be effective. No failure or delay by any party in
exercising any right, power or privilege hereunder shall operate as a waiver
thereof nor shall any single or partial exercise thereof preclude any other or
further exercise thereof or the exercise of any other right, power or privilege.
The rights and remedies herein provided shall be cumulative and in addition to
other or further remedies provided by law or equity.
SECTION 12.7 SEVERABILITY. The provisions of this Agreement shall be
deemed severable and the invalidity or unenforceability of any provision shall
not affect the validity or enforceability of the other provisions hereof. If any
provision of this Agreement, or the application thereof to any person,
corporation, partnership or other entity or any circumstance, is invalid and
unenforceable, (a) a suitable and equitable provision shall be substituted
therefor in order to carry out, so far as may be valid and enforceable, the
intent and purpose of such invalid or unenforceable provision and (b) the
remainder of this Agreement and the application of such provision to other
persons, corporations, partnerships or other entities or circumstances shall not
be affected by such invalidity or unenforceability, nor shall such invalidity or
unenforceability affect the validity or enforceability of such provision, or the
application thereof, in any jurisdiction.
SECTION 12.8 HEADINGS. The heading references herein are for
convenience purposes only, do not constitute a part of this Agreement and shall
not be deemed to limit or affect any of the provisions hereof.
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SECTION 12.9 BINDING EFFECT. This Agreement shall be binding upon the
parties hereto and their respective successors and permitted assigns, if any,
and except as provided herein, shall inure to the benefit of the parties hereto
and their respective successors and permitted assigns, if any.
SECTION 12.10 NO AGENCY OR PARTNERSHIP. Nothing in this Agreement will
create, or will be deemed to create, a partnership or the relationship of
principal and agent or of employer and employee between the parties.
SECTION 12.11 PROVISIONS UNAFFECTED. Nothing contained in this
Agreement shall affect the rights and obligations of InfoCure and PracticeWorks
pursuant to the Distribution Agreement.
SECTION 12.12 COUNTERPARTS. This Agreement may be executed in any
number of counterparts, each of which when so executed shall be deemed to be an
original and all of which when taken together shall constitute this Agreement.
SECTION 12.13 SUCCESSORS AND ASSIGNS. Neither InfoCure nor
PracticeWorks may, directly or indirectly, assign or subcontract, or attempt to
assign or subcontract, any of its rights or obligations under this Agreement, in
whole or in part, by operation of law or otherwise, except with the prior
written consent of the other party; it being understood that such consent shall
not be unreasonably withheld if PracticeWorks or InfoCure assigns this Agreement
to one of its affiliates with the financial and other resources and expertise to
perform all of the obligations of such party hereunder. Any attempted assignment
or delegation not in compliance with the forgoing shall be null and void and of
no effect.
SECTION 12.14 GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the laws of the State of Delaware and of the United
States.
SECTION 12.15 CONSENT TO JURISDICTION. Without limiting the provisions
of Article XI hereof, each of the parties irrevocably submits to the exclusive
jurisdiction of (a) the state courts of the State of Delaware, located in the
City of Wilmington, and (b) the United States District Court for the District of
Delaware, for the purposes of any suit, action or other proceeding arising out
of this Agreement or any transaction contemplated hereby. Each of the parties
agrees to commence any action, suit or proceeding relating hereto either in the
United States District Court for the District of Delaware or if such suit,
action or other proceeding may not be brought in such court for jurisdictional
reasons, in the state courts of the State of Delaware, located in the City of
Wilmington. Each of the parties further agrees that service of any process,
summons, notice or document by U.S. registered mail to such party's respective
address set forth above shall be effective service of process for any action,
suit or proceeding in Delaware with respect to any matters to which it has
submitted to jurisdiction in this Section 12.15. Each of the parties irrevocably
and unconditionally waives any objection to the laying of venue of any action,
suit or proceeding arising out of this Agreement or the transactions
contemplated hereby in (i) the state courts of the State of Delaware, located in
the City of Wilmington, or (ii) the United States District Court for the
District of Delaware, and hereby further irrevocably and unconditionally waives
and agrees not to plead or claim in any such court that any such action, suit or
proceeding brought in any such court has been brought in an inconvenient forum.
SECTION 12.16 NO THIRD-PARTY BENEFICIARIES. This Agreement is solely
for the benefit of the parties hereto and should not be deemed to confer upon
third parties any remedy, claim, liability, reimbursement, claim of action or
other right in excess of those existing without reference to this Agreement.
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IN WITNESS WHEREOF, the undersigned have caused this Agreement to be
duly executed as of the day and year first above written.
INFOCURE CORPORATION
By:
-------------------------------------
Xxxxxxxxx X. Fine
Chief Executive Officer
PRACTICEWORKS, INC.
By:
-------------------------------------
Xxxxx X. Xxxxx
Chief Executive Officer
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SCHEDULE A
Fixed Fees for 2001
