License Agreement - SmithKline Beecham Clinical Laboratories Inc. and ActaMed Corp.
LICENSE AGREEMENT
between
SMITHKLINE BEECHAM CLINICAL LABORATORIES, INC.
and
ACTAMED CORPORATION
December 31, 1997
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TABLE OF CONTENTS
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ARTICLE 1 - DEFINITIONS. . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.1 ActaLab Software . . . . . . . . . . . . . . . . . . . . . . . . 1
1.2 Affiliate. . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.3 Confidential Information . . . . . . . . . . . . . . . . . . . . 2
1.4 Derivative Work. . . . . . . . . . . . . . . . . . . . . . . . . 2
1.5 Documentation. . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.6 Exclusive Developments . . . . . . . . . . . . . . . . . . . . . 2
1.7 Health Care Field. . . . . . . . . . . . . . . . . . . . . . . . 2
1.8 Information Services . . . . . . . . . . . . . . . . . . . . . . 3
1.9 Object Code. . . . . . . . . . . . . . . . . . . . . . . . . . . 3
1.10 Other Lab. . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
1.11 ProviderLink . . . . . . . . . . . . . . . . . . . . . . . . . . 3
1.12 [*]. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
1.13 Providers. . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
1.14 Related Entity . . . . . . . . . . . . . . . . . . . . . . . . . 3
1.15 SBCL Software. . . . . . . . . . . . . . . . . . . . . . . . . . 3
1.16 SBCL Trademark . . . . . . . . . . . . . . . . . . . . . . . . . 3
1.17 SCAN Agreements. . . . . . . . . . . . . . . . . . . . . . . . . 3
1.18 SCAN Developments. . . . . . . . . . . . . . . . . . . . . . . . 4
1.19 Software . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
1.20 Source Code. . . . . . . . . . . . . . . . . . . . . . . . . . . 4
1.21 Specifications . . . . . . . . . . . . . . . . . . . . . . . . . 4
1.22 Territory. . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
1.23 Third Party Software . . . . . . . . . . . . . . . . . . . . . . 4
1.24 Trigger Date . . . . . . . . . . . . . . . . . . . . . . . . . . 4
ARTICLE 2 - LICENSE GRANTS; RELATED PROVISIONS . . . . . . . . . . . . . . . 4
2.1 SCAN Development License . . . . . . . . . . . . . . . . . . . . 4
2.2 ActaLab Development License. . . . . . . . . . . . . . . . . . . 5
2.3 Conditions . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
2.4 Technology Transfer. . . . . . . . . . . . . . . . . . . . . . . 6
2.5 Royalties. . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
ARTICLE 3 - SCAN DEVELOPMENTS OWNERSHIP; RELATED PROVISIONS. . . . . . . . . 6
3.1 Ownership. . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
3.2 Limitations. . . . . . . . . . . . . . . . . . . . . . . . . . . 7
ARTICLE 4 - LICENSE BACK . . . . . . . . . . . . . . . . . . . . . . . . . . 8
4.1 License Grant. . . . . . . . . . . . . . . . . . . . . . . . . . 8
4.2 Term of License. . . . . . . . . . . . . . . . . . . . . . . . . 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.
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4.3 Sublicenses. . . . . . . . . . . . . . . . . . . . . . . . . . . 8
4.4 Usage Fees . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
4.5 ActaLab Software Escrow. . . . . . . . . . . . . . . . . . . . . 9
ARTICLE 5 - MARKINGS . . . . . . . . . . . . . . . . . . . . . . . . . . . .10
5.1 By ActaMed . . . . . . . . . . . . . . . . . . . . . . . . . . .10
5.2 By SBCL. . . . . . . . . . . . . . . . . . . . . . . . . . . . .11
ARTICLE 6 - DEVELOPMENT AGREEMENT AMENDMENTS . . . . . . . . . . . . . . . .11
ARTICLE 7 - WARRANTIES . . . . . . . . . . . . . . . . . . . . . . . . . . .11
7.1 Warranty of Title and Noninfringement. . . . . . . . . . . . . .11
7.2 Authorization. . . . . . . . . . . . . . . . . . . . . . . . . .12
7.3 Disclaimers. . . . . . . . . . . . . . . . . . . . . . . . . . .12
ARTICLE 8 - INDEMNITY. . . . . . . . . . . . . . . . . . . . . . . . . . . .12
8.1 General. . . . . . . . . . . . . . . . . . . . . . . . . . . . .12
8.2 Services . . . . . . . . . . . . . . . . . . . . . . . . . . . .13
8.3 Infringement . . . . . . . . . . . . . . . . . . . . . . . . . .13
8.4 Claims Notice. . . . . . . . . . . . . . . . . . . . . . . . . .13
8.5 Procedures Involving Non-Third Party Claims. . . . . . . . . . .13
8.6 Procedures Involving Third Party Claims. . . . . . . . . . . . .14
8.7 No Release for Fraud . . . . . . . . . . . . . . . . . . . . . .15
8.8 Payment. . . . . . . . . . . . . . . . . . . . . . . . . . . . .15
8.9 Survival . . . . . . . . . . . . . . . . . . . . . . . . . . . .15
ARTICLE 9 - LIMITATION OF LIABILITY. . . . . . . . . . . . . . . . . . . . .16
ARTICLE 10 - CONFIDENTIALITY . . . . . . . . . . . . . . . . . . . . . . . .16
ARTICLE 11 - ASSIGNMENT. . . . . . . . . . . . . . . . . . . . . . . . . . .16
11.1 By SBCL. . . . . . . . . . . . . . . . . . . . . . . . . . . . .16
11.2 By ActaMed . . . . . . . . . . . . . . . . . . . . . . . . . . .17
11.3 Other. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .17
ARTICLE 12 - DISPUTE RESOLUTION. . . . . . . . . . . . . . . . . . . . . . .17
12.1 Informal Dispute Resolution. . . . . . . . . . . . . . . . . . .17
12.2 Arbitration. . . . . . . . . . . . . . . . . . . . . . . . . . .18
12.3 Immediate Injunctive Relief. . . . . . . . . . . . . . . . . . .19
12.4 Jurisdiction . . . . . . . . . . . . . . . . . . . . . . . . . .19
12.5 Continued Performance; Continuation of Licenses. . . . . . . . .19
ARTICLE 13 - MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . . . . . .20
13.1 Further Assurances . . . . . . . . . . . . . . . . . . . . . . .20
13.2 Integration. . . . . . . . . . . . . . . . . . . . . . . . . . .20
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13.3 Force Majeure. . . . . . . . . . . . . . . . . . . . . . . . . .20
13.4 No Agency. . . . . . . . . . . . . . . . . . . . . . . . . . . .20
13.5 No Waiver. . . . . . . . . . . . . . . . . . . . . . . . . . . .20
13.6 Severability . . . . . . . . . . . . . . . . . . . . . . . . . .21
13.7 Notices. . . . . . . . . . . . . . . . . . . . . . . . . . . . .21
13.8 Governing Law; Interpretation. . . . . . . . . . . . . . . . . .21
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SCHEDULES
Schedule A SBCL Software
Schedule B Amendments to Development Agreement
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CONFIDENTIAL TREATMENT REQUESTED
LICENSE AGREEMENT
THIS LICENSE AGREEMENT ("License Agreement") dated December 31, 1997
(the "Effective Date") is by and between SMITHKLINE BEECHAM CLINICAL
LABORATORIES, INC., a Delaware corporation ("SBCL") and ACTAMED CORPORATION, a
Georgia corporation ("ActaMed").
WHEREAS, SBCL and ActaMed have entered into an Assets Purchase
Agreement dated of even date herewith (the "Purchase Agreement") pursuant to
which ActaMed has agreed to purchase certain assets owned by SBCL and used to
provide certain services to health care service providers;
WHEREAS, the Purchase Agreement contemplates that the parties will
enter into a license agreement substantially on the terms set forth herein, as
well as a Services Agreement (the "Services Agreement") pursuant to which
ActaMed shall provide certain services to SBCL and to health care service
providers;
WHEREAS, SBCL and ActaMed have previously entered into a Development
Agreement dated October 31, 1997 (the "Development Agreement") pursuant to which
ActaMed agreed to perform certain development services; and
WHEREAS, the parties desire to amend the provisions of the Development
Agreement pursuant to which SBCL authorized ActaMed to use SBCL software and
related materials in the performance of work under the Development Agreement,
and pursuant to which the parties allocated ownership of deliverables created
under the Development Agreement and intellectual property rights therein;
NOW THEREFORE, in consideration of the foregoing premises and other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, and intending to be legally bound, SBCL and ActaMed agree as
follows:
ARTICLE 1 - DEFINITIONS
1.1 "ACTALAB SOFTWARE" means (i) any updated, upgraded, corrected, modified,
or enhanced version of ProviderLink created by or for ActaMed, and any
Derivative Works made from ProviderLink by or for ActaMed, and any other
Software owned and employed by ActaMed in providing Information Services
or related services in accordance with the terms of the Services
Agreement, in each case embodying, incorporating or practicing the SBCL
Software or any portion thereof, (ii) any compiler or other program
reasonably required to create Object Code from the Source Code of the
foregoing or use any of the foregoing in the provision of Information
Services, and (iii) any Documentation relating to any of the
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foregoing created by or for ActaMed. Without limiting the foregoing,
"ActaLab Software" shall include [*] (as the term is defined in the
Services Agreement).
1.2 "AFFILIATE" of an entity means a company or other person controlling,
controlled by or under common control with such entity.
1.3 "CONFIDENTIAL INFORMATION" means any and all proprietary information
disclosed or made available by a party hereto to the other party
pursuant to this License Agreement, whether in written, oral, magnetic,
photographic, optical or other form and whether now existing or
hereafter created, including, without limitation, all trade secrets,
know-how, information systems, technology, data, computer programs,
processes, methods, operational procedures, plans, strategies or
results, and other information of a similar nature that is not generally
disclosed by such party to the public. Without limiting the foregoing,
ActaMed's Confidential Information shall include the Source Code and
Documentation for the ProviderLink Software and ActaLab Software, and
SBCL's Confidential Information shall include the Source Code and
Documentation for the SBCL Software and the SCAN Developments.
Confidential Information shall not include any information which (a) is
proven by written evidence to have been in the receiving party's
possession prior to disclosure by the other party; (b) is received from
a third party having the right to disclose such information; (c) is or
hereafter becomes public knowledge through no act or fault of the
receiving party; or (d) is proven by written evidence to have been
independently developed by the receiving party without access to the
Confidential Information of the other party.
1.4 "DERIVATIVE WORK" means a work that is based upon one or more
preexisting works, such as a revision, modification, translation,
abridgment, condensation, expansion, or any other form in which such
preexisting works may be recast, transformed, translated or adapted, and
that, if prepared without authorization of the owner of the copyright in
such preexisting work, would constitute a copyright infringement.
1.5 "DOCUMENTATION" means manuals (e.g., user, utility reference and
language reference) and other written materials that relate to
particular Software, including materials useful for the operation of the
Software by a user (collectively, "USER DOCUMENTATION"), and information
(e.g., data flows, data structures, control logic, flow diagrams, and
principles of operation) useful for design, modification and maintenance
of the Source Code by a programmer (collectively, "PROGRAMMER
DOCUMENTATION").
1.6 "EXCLUSIVE DEVELOPMENTS" shall have the meaning ascribed to it by
Section V.E of the Services Agreement.
1.7 "HEALTH CARE FIELD" means the provision of electronic data interchange
technology relating to patients, patient-related services or the
practice of medicine, to Providers, Healthcare Payors and Healthcare
Administrators. "Healthcare Payor," for the purposes of this
definition, means any person or entity that pays for the provision of
healthcare services,
[*] 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.
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including without limitation employers, insurance companies,
regional healthcare alliances, and federal, state and local
governmental agencies. "Healthcare Administrator" means those
entities engaged in the administration of healthcare services,
including without limitation managed care companies, utilization
review companies and third party administrators. Notwithstanding
the foregoing, "Health Care Field" shall exclude services relating
to or provided to [*].
1.8 "INFORMATION SERVICES" means the transmission of orders for laboratory
tests and/or laboratory test results and reports.
1.9 "OBJECT CODE" means the form of Software resulting from the translation
or processing of the Source Code by a computer into machine language or
intermediate code in a form that is not convenient to human
understanding but which is appropriate for execution or interpretation
by a computer, together with related User Documentation.
1.10 "OTHER LAB" shall have the meaning ascribed to it by the Services
Agreement.
1.11 "PROVIDERLINK" means the ActaMed proprietary Software known as
ProviderLink as it exists on the Effective Date, together with any
updates, upgrades, enhancements, modifications or Derivative Works made
thereto or therefrom by or for ActaMed other than under the licenses
granted by this License Agreement, and the Specifications and
Documentation relating to and of the foregoing prepared by or for
ActaMed.
1.12 [*].
1.13 "PROVIDERS" means physicians, clinics, hospitals and other providers of
clinical health care services other than [*].
1.14 "RELATED ENTITY" means an entity that is engaged in the laboratory
testing business and in which SBCL or an SBCL affiliate has a legal or
beneficial ownership of ten percent (10%) or more.
1.15 "SBCL SOFTWARE" means the Software described in Schedule A hereto.
"SBCL Software" shall in no event be construed to include [*] or Third
Party Software.
1.16 "SBCL TRADEMARK" means SBCL's trade names, logos, trademarks, trade
devices, product names and/or service marks.
1.17 "SCAN AGREEMENTS" means the Development Agreement, Purchase Agreement,
Services Agreement and this License Agreement.
[*] 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.
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1.18 "SCAN DEVELOPMENTS" means (i) any updated, upgraded, corrected,
modified, or enhanced version of the SBCL Software created by or for
ActaMed under the rights granted by this License Agreement, and (ii) any
Documentation relating to any of the foregoing created by or for
ActaMed, provided, that SCAN Developments shall in no event be construed
to include the ActaLab Software.
1.19 "SOFTWARE" means computer programming code consisting of Object Code
and/or Source Code and/or associated procedural code, as applicable,
including updates and revisions thereto.
1.20 "SOURCE CODE" means program instructions and codes written by humans
with the intention that the instructions and codes be compiled and
interpreted by a computer, including all existing commentary,
explanations, control procedures, record layouts for all files and
program listings-source codes, design documentation, user manuals,
programmers' guides, system guides, current compilation instructions,
and all other User Documentation and Programmer Documentation.
1.21 "SPECIFICATIONS" means a description of the design, operating
procedures, performance, functions and other requirements for Software.
1.22 "TERRITORY" means the United States of America, including all
territories and possessions thereof.
1.23 "THIRD PARTY SOFTWARE" means Software that SBCL prior to the Effective
Date licensed from third parties for use in delivery of automated order
entry and results reporting services, including without limitation
Software known as [*] and [*].
1.24 "TRIGGER DATE" shall have the meaning ascribed to it by Section 4.4.1
hereof.
ARTICLE 2 - LICENSE GRANTS; RELATED PROVISIONS
2.1 SCAN DEVELOPMENT LICENSE. Subject to the terms and conditions of this
License Agreement, SBCL hereby grants ActaMed a perpetual, irrevocable,
nonexclusive, non-transferable (except as otherwise expressly set forth
herein) right and license in the Health Care Field in the Territory to:
2.1.1 possess and use the SBCL Software to update, upgrade, enhance,
modify and create Derivative Works from the SBCL Software and
otherwise create SCAN Developments; and
2.1.2 possess and use, update, upgrade, enhance, modify and create
Derivative Works from the SBCL Software, SCAN Developments and
ActaLab Software;
[*] 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.
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2.1.3 possess and use the SBCL Software and SCAN Developments for the
purposes of performing ActaMed's obligations under the SCAN
Agreements; and
2.1.4 possess and use the SCAN Developments for the purpose of
providing Information Services in support of the laboratory
testing services offered by Other Labs only to the extent such
SCAN Developments do not constitute Exclusive Developments under
the Service Agreement.
The foregoing license shall include the right to (i) sublicense the SBCL
Software and/or SCAN Developments to one or more contractors performing
the activities described in Sections 2.1.1 or 2.1.2 hereof for ActaMed's
benefit and for ActaMed's account, and (ii) sublicense Providers, [*]
and Other Labs to use the Object Code version of the SBCL Software
and/or the SCAN Developments as ActaMed reasonably determines necessary
or appropriate in connection with its provision of the services
contemplated by Section 2.1.3, in each case provided that each
sublicensee executes a written agreement (x) prohibiting such
sublicensee from disclosing SBCL Confidential Information or using the
same other than as contemplated by this Section 2.1, and (y) precluding
the sublicensee or any of its employees or agents from gaining or
holding any right or interest in the SBCL Software.
2.2 ACTALAB DEVELOPMENT LICENSE
2.2.1 GRANT. Subject to the terms and conditions of this License
Agreement, SBCL hereby grants ActaMed a perpetual, irrevocable,
nonexclusive, non-transferable (except as otherwise expressly set
forth herein) right and license to possess and use the SBCL
Software to update, upgrade, enhance, modify and create
Derivative Works from ProviderLink and otherwise create ActaLab
Software pursuant to the Development Agreement and otherwise.
The license granted by this Section 2.2.1 shall survive the
termination of this License Agreement.
2.2.2 OWNERSHIP. Ownership of Deliverables (as defined by the
Development Agreement) relative to the ActaLab Software shall be
governed by Section 5 of the Development Agreement, as amended.
Ownership of all other ActaLab Software and all intellectual
property rights therein (including but not limited to copyrights
and all renewals and extensions thereof) shall vest in ActaMed,
except that nothing in this Agreement shall be construed to
transfer to ActaMed, or otherwise divest SBCL of SBCL's ownership
of, the SBCL Software or SCAN Developments or the patents,
copyrights, trade secrets and other intellectual property rights
therein. ActaMed shall own the ActaLab Software Exclusive
Developments.
2.3 CONDITIONS.
2.3.1 As a material inducement for SBCL's grant of the licenses
contemplated by this Agreement and the amendments to the
Development Agreement contemplated by
[*] 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.
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Article 6 of this Agreement, ActaMed hereby covenants and
agrees that, except as SBCL may authorize in writing, ActaMed
(and any sublicensee of ActaMed) shall use the ActaLab
Software solely within the Territory and solely in the Health
Care Field.
2.3.2 ActaMed further covenants and agrees that, except as SBCL may
otherwise agree in writing, ActaMed shall not use or license the
use of the ActaLab Software Exclusive Developments for the
benefit of any party other than in support of SBCL's laboratory
testing services.
2.4 TECHNOLOGY TRANSFER. SBCL, within thirty (30) days following the
Effective Date, shall provide ActaMed with one copy of all currently
existing SBCL Software not previously provided in connection with the
Development Agreement or otherwise. Thereafter, during the term of the
Services Agreement, SBCL shall promptly provide ActaMed with such
updates, upgrades and enhancements to the SBCL Software as SBCL, in its
sole discretion, may make or have made during the term of the Services
Agreement.
2.5 ROYALTIES.
2.5.1 If ActaMed uses the SBCL Software, SCAN Developments or ActaLab
Software in the provision of Information Services to [*] ActaMed
shall agree to pay SBCL a royalty equal to [*] of Royalty
Revenues for the Royalty Period applicable to such [*]. "Royalty
Revenues," for these purposes, means the [*] ActaMed collects for
such Information Services. The "Royalty Period," with respect to
Software or services provided in support of a given [*] means
the [*] period commencing on the date [*].
2.5.2 The royalties accruing pursuant to this Section 2.4 shall be
payable on a [*] basis, and shall be due within [*] days
following the end of the [*] in which they accrue. Each such
royalty payment shall be accompanied by a report showing, by each
[*] the total Royalty Revenue collected during the applicable
[*] and the royalty amount due in respect of such Royalty
Revenue.
ARTICLE 3 - SCAN DEVELOPMENTS OWNERSHIP; RELATED PROVISIONS
3.1 OWNERSHIP.
3.1.1 Subject to the provisions of Section 3.2 hereof, SBCL, as between
ActaMed and SBCL, shall have sole and exclusive ownership in and
title to the SBCL Software and SCAN Developments, including all
intellectual property rights therein. Without limiting the
foregoing, the SCAN Developments shall be "works made for hire"
for
[*] 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.
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the benefit of SBCL. To the extent that any of the SCAN
Developments, by operation of law, may not be works made for
hire, or to the extent ActaMed otherwise would retain any rights
in the SCAN Developments, ActaMed, subject to the provisions of
Section 3.2.2 hereof, hereby assigns to SBCL the ownership of any
patent or copyright in the SCAN Developments and SBCL shall have
the right to obtain and hold in its own name copyrights, patents,
registrations and similar protections which may be available with
respect to the SCAN Developments.
3.1.2 Nothing in this Agreement shall be construed to transfer to SBCL,
or otherwise divest ActaMed of ActaMed's ownership of,
ProviderLink, the ActaLab Software or the patents, copyrights,
trade secrets and other intellectual property rights therein,
provided, that, subject to the provisions of Section 3.2.1
hereof, ActaMed hereby grants SBCL a perpetual, nonexclusive,
royalty-free license (with right of sublicense) under such
intellectual property rights to use, possess, update, upgrade,
enhance, modify, reproduce, market, distribute and sell the SCAN
Developments.
3.1.3 ActaMed shall provide SBCL with the Source Code for the SCAN
Developments on or before the first release of the same to a
commercial customer or the use of the same in providing a
commercial service (the "Release Date") and, thereafter, on or
before the Release Date of any updates, upgrades, enhancements or
modifications thereto and, in any event, [*] during the term of
the Services Agreement (including any renewal terms thereof).
3.2 LIMITATIONS.
3.2.1 SBCL covenants and agrees that, prior to the expiration or
termination of the Services Agreement, it shall not use, or
sublicense any other party to use, the SCAN Developments except
(i) in the Territory solely for the purpose of performing
Information Services in support of the laboratory testing
services offered [*] that has not been transferred to ActaMed
pursuant to the Purchase Agreement, and (ii) outside of the
Territory. In the event SBCL uses the SCAN Developments to
provide Information Services in support of [*] within the
Territory, SBCL shall pay ActaMed a usage fee to be negotiated by
the parties, such usage fee to be determined in accordance with
the provisions, and during the term, of the Services Agreement.
3.2.2 Except to the extent such SCAN Developments constitute Exclusive
Developments, nothing in this Agreement shall be construed to (i)
grant SBCL or any other party ownership of such portions of the
SCAN Developments as are devoted solely to the process of
checking patient eligibility for third party payor benefits or
reimbursement, or claim status checking (collectively,
"Eligibility Services"), or (ii) grant SBCL any right or license
to use the SCAN Developments for the purposes of performing or
providing Eligibility Services, except that SBCL shall not be
required to delete or
[*] 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.
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remove the Eligibility Code from the SCAN Developments prior
to exercising the rights and licenses granted by this Article
3.
ARTICLE 4 - LICENSE BACK
4.1 LICENSE GRANT. Subject to the provisions of this Article 4, ActaMed
hereby grants SBCL an irrevocable, nonexclusive, non-transferable
(except as expressly set forth herein) right and license in the
Territory in the Health Care Field to:
4.1.1 possess and use the ActaLab Software to create [*] and update,
upgrade, modify, enhance and create Derivative Works from [*]
(such Derivative Works being referred to herein as the [*]) as
SBCL reasonably determines necessary to perform Information
Services in support of laboratory test services offered by SBCL
and/or Related Entities, including without limitation to ensure
compliance with laws and regulations applicable to the business
of SBCL and Related Entities, PROVIDED, that SBCL covenants and
agrees that it shall not exercise the licenses granted by this
Section 4.1.1 prior to the earlier of [*] (the "Trigger Date");
and
4.1.2 possess and use [*] and [*] for internal business purposes of
SBCL and Related Entities, including without limitation the
provision of Information Services to Providers in support of
their respective laboratory testing services, PROVIDED, that
SBCL covenants and agrees that it shall not exercise the licenses
granted by this Section 4.1.2 prior to the date on which the
Services Agreement expires as a result of ActaMed's notice of
nonrenewal or the date on which the Services Agreement terminates
for ActaMed's breach, as applicable.
4.2 TERM OF LICENSE. The licenses granted by this Article 4 shall expire on
the second anniversary of the date on which SBCL first uses ActaLabSB on
a commercial basis in support of SBCLs laboratory testing services.
4.3 SUBLICENSES. The licenses granted by Section 4.1 shall include the
right to (a) sublicense the ActaLab Software, and [*] to one or more
contractors performing any of the foregoing for the benefit and account
of SBCL or a Related Entity, and (b) sublicense Providers to use the
Object Code version of [*] as reasonably may be required to provide the
services contemplated by Section 4.1.2, in each case provided that each
sublicensee executes a written agreement (x) prohibiting such sublicensee
from disclosing ActaMed Confidential Information or using the same other
than as contemplated
[*] 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.
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by this Article 4, and (y) precluding the sublicensee or any of
its employees or agents from gaining or holding any right or
interest in the ActaLab Software.
4.4 USAGE FEES.
4.4.1 SBCL, in addition to the other consideration contemplated by the
SCAN Agreements, agrees to pay, as a royalty, a Usage Fee on each
Royalty Transaction. For the purposes of this Section 4.4.1:
(i) "Royalty Transaction" means a Requisition (as defined in
the Services Agreement) entered [*] (pursuant to Sections
XII.E.1.b or XII.E.3.c. of the Services Agreement) to or
for a site other than one of the Permitted Number of
sites.
(ii) "Usage Fee" means the lesser of (i) [*] per Requisition
and [*] of the Transaction Fee then prevailing under
Article IV of the Services Agreement or (ii) [*] of an
amount competitive with the market for Information
Services, such amount [*] to be calculated in accordance
with the principles established by Section IV of the
Services Agreement.
(iii) "Permitted Number" means [*] the number of sites [*] the
largest number of sites with respect to which [*].
4.4.2 The royalties accruing pursuant to this Section 4.4 shall be
payable on a [*] and shall be due within [*] days following the
end of the [*] in which they accrue. Each such royalty payment
shall be accompanied by a report showing the manner in which the
payment amount was calculated.
4.5 ACTALAB SOFTWARE ESCROW.
4.5.1 Promptly upon the execution of this License Agreement, ActaMed
shall give written notice to Fort Knox Escrow Services, Inc.
("Fort Knox") instructing Fort Knox to add SBCL to the list of
Licensees maintained pursuant to that certain Master Escrow
Agreement dated February 20, 1995 (the "Escrow Agreement").
ActaMed shall deposit the Source Code for all ActaLab Software in
accordance with the terms of the Escrow Agreement on or before
the first release of the same to a commercial customer or the use
of the same in providing a commercial service (the "Release
Date") and, thereafter, on or before the Release Date of any
updates, upgrades,
[*] 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.
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enhancements or modifications thereto and, in any event, no
less often than once [*] during the term of the Services
Agreement (including any renewal terms thereof).
4.5.2 ActaMed, within thirty (30) days of the date of this Agreement
shall enter into an amendment to the Escrow Agreement with Fort
Knox, reasonably acceptable to SBCL in form and substance, to the
effect that Fort Knox, at SBCL's request and expense, agrees to
inspect the deposit materials supplied by ActaMed for the purpose
of confirming their identity and completeness.
4.5.3 ActaMed, promptly upon SBCL's demand made at any time following
the Trigger Date, shall notify Fort Knox in accordance with
Section 4.1(a) of the Escrow Agreement to deliver the Source Code
for the ActaLab Software to SBCL, which notice shall be
accompanied by the fees specified in such Section 4.1(a).
4.5.4 ActaMed covenants and agrees to maintain the Escrow Agreement in
full force and effect during the term of the Services Agreement,
and acknowledges that its failure to do so will constitute a
material breach of this License Agreement and the Services
Agreement.
4.5.5 ActaLab hereby appoints SBCL as its attorney in fact for the
limited purpose of providing to Fort Knox the notices
contemplated by this Section 4.4.1 and 4.4.3.
ARTICLE 5 - MARKINGS
5.1 BY ACTAMED. ActaMed shall reproduce SBCLs copyright notice on all SBCL
Software and SCAN Developments in accordance with the practice
prevailing in the software industry. Subject to the foregoing sentence:
5.1.1 ActaMed, on or before the date on which ActaMed switches any site
from the SBCL gateway to the ActaMed gateway (as described in
Section II.B of the Services Agreement), shall remove SBCL
Trademarks from the sign-on screen for the ActaLab Software and
SCAN Developments resident on the computer at such site, and from
any other screens that might reasonably suggest that SBCL, rather
than ActaMed, is the source of the Information Services provided
using such Software; and
5.1.2 ActaMed, with the reasonable assistance of SBCL's Distribution
Service Representatives in accordance with Section II.B.4 of the
Services Agreement, shall remove SBCL Trademarks from any
equipment owned or controlled by ActaMed and located at a given
site within three (3) months of the Transfer Date for such site,
but in any event prior to the date on which ActaMed transfers
ownership of such equipment to any other party.
[*] 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.
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5.2 BY SBCL. SBCL shall reproduce ActaMeds copyright notice on all copies
of the ActaLab Software in accordance with the practice prevailing in
the software industry.
ARTICLE 6 - DEVELOPMENT AGREEMENT AMENDMENTS
The parties hereby agree to amend the Development Agreement as set forth in
Schedule B hereto.
ARTICLE 7 - WARRANTIES
7.1 WARRANTY OF TITLE AND NONINFRINGEMENT.
7.1.1 ActaMed represents and warrants to SBCL that:
(i) Unless ActaMed provides SBCL with advance written notice
to the contrary in accordance with Section 5.2(b) of the
Development Agreement, ActaMed is and will be the sole
author of all works used by ActaMed in preparing the
ActaLab Software and SCAN Developments;
(ii) ActaMed shall require all officers, employees,
contractors, representatives and agents who provide
services with respect to the ActaLab Software, SBCL
Software or SCAN Developments under the SCAN Agreements
to assign to ActaMed all intellectual property rights
created or arising therein;
(iii) Subject to the provisions of Section 7.1.2 hereof,
ActaMed has and will have full and sufficient right in
the ActaLab Software to grant the licenses and rights
contemplated by Article 4 of this License Agreement, free
and clear of any liens, claims or encumbrances;
(iv) Subject to the provisions of Section 7.1.2 hereof, the
terms and conditions set forth in Article 3 hereof are
sufficient to convey to SBCL all right, title and
interest in and to the SCAN Developments, and following
such conveyance neither ActaMed nor any third party shall
retain any right, title or interest in the SCAN
Developments other than the licenses expressly set forth
herein; and
(v) Subject to the provisions of Section 7.1.2 hereof, none
of the ActaLab Software or SCAN Developments infringes
any patents, copyrights, trademarks, or other
intellectual property rights (including trade secrets),
privacy or similar rights of any third party, nor has any
claim of such infringement been threatened or asserted.
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7.1.2 SBCL represents and warrants to ActaMed that:
(i) SBCL is the sole author of the SBCL Software;
(ii) SBCL has required all officers, employees, contractors,
representatives and agents who prior to the date of this
Agreement provided services with respect to the Software
to assign to SBCL all intellectual property rights
created or arising therein;
(iii) SBCL has and will have full and sufficient right in the
SBCL Software to grant the licenses and rights
contemplated by Article 2 of this License Agreement, free
and clear of any liens, claims or encumbrances; and
(iv) none of the SBCL Software provided to ActaMed by SBCL
hereunder infringes any patents, copyrights, trademarks,
or other intellectual property rights (including trade
secrets), privacy or similar rights of any third party,
nor has any claim of such infringement been threatened or
asserted.
7.2 AUTHORIZATION. Each of ActaMed and SBCL represents and warrants that,
as of the Effective Date of this License Agreement (i) it is duly
authorized to enter into this License Agreement, and (ii) it is free of
any obligation or restriction that would prevent it either from entering
into or performing this License Agreement.
7.3 DISCLAIMERS. THE FOREGOING WARRANTY IS IN LIEU OF ANY OTHER WARRANTY,
EXPRESS OR IMPLIED, INCLUDING BUT NOT LIMITED TO ANY IMPLIED WARRANTIES
OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE WHICH ARE HEREBY
SPECIFICALLY EXCLUDED AND DISCLAIMED. WITHOUT LIMITING THE FOREGOING,
(i) NOTHING IN THIS LICENSE AGREEMENT SHALL BE CONSTRUED TO EXPAND OR
EXTEND THE WARRANTIES ACTAMED GRANTS IN THE OTHER SCAN AGREEMENTS WITH
RESPECT TO THE ACTALAB SOFTWARE OR SCAN DEVELOPMENTS, AND (ii) SUBJECT
TO SUCH WARRANTIES AND REPRESENTATIONS AS ARE CONTAINED IN THE OTHER
SCAN AGREEMENTS, ACTAMED ACKNOWLEDGES THAT SBCL IS LICENSING THE SBCL
SOFTWARE TO ACTAMED ON AN AS IS BASIS, AND HEREBY DISCLAIMS ANY
WARRANTIES WITH RESPECT TO THE OPERATION THEREOF.
ARTICLE 8 - INDEMNITY
8.1 GENERAL. Each party hereto shall indemnify, defend and hold harmless the
other party and its officers, employees, representatives and agents
against any and all damages, losses, or expenses suffered or paid as a
result of any claims, demands, suits, causes of action,
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proceedings, awards, judgments, and liabilities (including
reasonable attorneys fees) incurred in litigation, arbitration
or otherwise, assessed, incurred, or sustained (each, a Claim)
with respect to or arising out of the breach by the
Indemnifying Party of any representation, warranty, covenant
or agreement made herein.
8.2 SERVICES. ActaMed shall indemnify, defend and hold harmless SBCL and
its officers, employees, representatives and agents against any Claim
arising from or relating to ActaMeds provision of the ActaLab Software,
SCAN Developments or any services, in each case in support of any Other
Lab pursuant to this License Agreement. SBCL shall indemnify, defend
and hold harmless ActaMed and its officers, employees, representatives
and agents against any Claim arising from or relating to SBCLs provision
of the SCAN Developments or any services outside the Territory or to [*]
as contemplated by Section 3.2 hereof.
8.3 INFRINGEMENT.
8.3.1 ActaMed, subject to the provisions of Section 8.3.2 hereof, shall
indemnify, defend and hold harmless SBCL and the Related Entities
and their respective officers, employees, representatives and
agents against any Claim alleging the ActaLab Software or any
SCAN Development infringes or constitutes misappropriation of any
U.S. or foreign patent or any other U.S. or foreign proprietary
right of a third party.
8.3.2 SBCL shall indemnify, defend and hold harmless ActaMed and its
Affiliates and their respective officers, employees,
representatives and agents against any Claim alleging the SBCL
Software infringes or constitutes misappropriation of any U.S. or
foreign patent or any other U.S. or foreign proprietary right of
a third party.
8.4 CLAIMS NOTICE. A Claim shall be made by any entity or individual
eligible for indemnification pursuant to this Article 8 (an Indemnitee)
by delivery of a Claims Notice to the party owing a duty of
indemnification under this Article 8 (the Indemnifying Party) requesting
indemnification and specifying the basis on which indemnification is
sought and the amount of asserted Losses (as defined in the Services
Agreement) and, in the case of a Third Party Claim (as defined in the
Services Agreement), containing (by attachment or otherwise) such other
information as such Indemnitee shall have concerning such Third Party
Claim.
8.5 PROCEDURES INVOLVING NON-THIRD PARTY CLAIMS. If the Claim involves a
matter other than a Third Party Claim, the Indemnifying Party shall
raise any objection to such Claim within a reasonable period of time by
delivery of a written notice of such objection to such Indemnitee
specifying in reasonable detail the basis for such objection. If an
objection is timely interposed by the Indemnifying Party, the
Indemnifying Party and the Indemnitee shall cooperate in the compromise
of the Claim or resolve any disagreement in accordance with Article 12
hereof.
[*] 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.
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<PAGE>
8.6 PROCEDURES INVOLVING THIRD PARTY CLAIMS. The obligations and
liabilities of the parties hereunder with respect to a Third Party Claim
shall be subject to the following terms and conditions:
8.6.1 The Indemnitee shall give the Indemnifying Party written notice
of a Third Party Claim promptly after receipt by the Indemnitee
of notice thereof, and the Indemnifying Party may undertake the
defense, compromise and settlement thereof by representatives of
its own choosing reasonably acceptable to the Indemnitee. The
failure of the Indemnitee to notify the Indemnifying Party of
such claim shall not relieve the Indemnifying Party of any
liability that they may have with respect to such claim except to
the extent the Indemnifying Party demonstrates that the defense
of such claim is prejudiced by such failure. The assumption of
the defense, compromise and settlement of any such Third Party
Claim by the Indemnifying Party shall be an acknowledgment of the
obligation of the Indemnifying Party to indemnify the Indemnitee
with respect to such claim hereunder. If the Indemnitee desires
to participate in, but not control, any such defense, compromise
and settlement, it may do so at its sole cost and expense. If,
however, the Indemnifying Party fails or refuses to undertake the
defense of such Third Party Claim within ten (10) days after
written notice of such claim has been given to the Indemnifying
Party by the Indemnitee, the Indemnitee shall have the right to
undertake the defense, compromise and settlement of such claim
with counsel of its own choosing. In the circumstances described
in the preceding sentence, the Indemnitee shall, promptly upon
its assumption of the defense of such claim, make a Claim as
specified in Section 8.3 which shall be deemed a Claim that is
not a Third Party Claim for the purposes of the procedures set
forth herein.
8.6.2 If, in the reasonable opinion of the Indemnitee, any Third Party
Claim or the litigation or resolution thereof involves an issue
or matter which could have a material adverse effect on the
business, operations, assets, properties or prospects of the
Indemnitee, the Indemnitee shall have the right to control the
defense, compromise and settlement of such Third Party Claim
undertaken by the Indemnifying Party, and the reasonable costs
and expenses of the Indemnitee in connection therewith shall be
included as part of the indemnification obligations of the
Indemnifying Party hereunder. If the Indemnitee shall elect to
exercise such right, the Indemnifying Party shall have the right
to participate in, but not control, the defense, compromise and
settlement of such Third Party Claim at its sole cost and
expense.
8.6.3 No settlement of a Third Party Claim involving the asserted
liability of the Indemnifying Party under this Article shall be
made without the prior written consent by or on behalf of the
Indemnifying Party, which consent shall not be unreasonably
withheld or delayed. If the Indemnifying Party assumes the
defense of such a Third Party Claim, (1) no compromise or
settlement thereof may be effected by the Indemnifying Party
without the Indemnitee's consent unless (a) there is no finding
or
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admission of any violation of law or any violation of the
rights of any person and no effect on any other claim that may be
made against the Indemnitee (b) the sole relief provided is
monetary damages that are paid in full by the Indemnifying Party
and (c) the compromise or settlement includes, as an
unconditional term thereof, the giving by the claimant or the
plaintiff to the Indemnitee of a release, in form and substance
satisfactory to the Indemnitee, from all liability in respect of
such Third Party Claim, and (2) the Indemnitee shall have no
liability with respect to any compromise or settlement thereof
effected without its consent.
8.7 NO RELEASE FOR FRAUD. Nothing contained in this Agreement shall relieve
or limit the liability of a party or any officer or director of such
party from any Liability arising out of or resulting from common law
fraud or intentional misrepresentation in connection with the
transactions contemplated by this Agreement or in connection with the
delivery of this Agreement. Each ActaMed Indemnitee or SBCL Indemnitee,
as the case may be, shall have a right to indemnification for any Loss
incurred as the result of any common law fraud or intentional
misrepresentation by SBCL or ActaMed, respectively, or any officer or
director thereof.
8.8 PAYMENT.
8.8.1 If any party is required to make any payment under this Article
8, such party shall promptly pay the Indemnified Party the amount
so determined. If there is a dispute as to the amount or manner
of determination of any indemnity obligation owed under this
Article 8, the Indemnifying Party shall nevertheless pay when due
such portion, if any, of the obligation as shall not be subject
to dispute. The difference, if any, between the amount of the
obligation ultimately determined as properly payable under this
Article 8 and the portion, if any, theretofore paid shall bear
interest as set forth in Section 8.8.3 hereof.
8.8.2 Any items as to which an Indemnified Party is entitled to payment
under this Article may be paid by set off against amounts payable
to the Indemnifying Party to the extent that such amounts are
sufficient to pay such items.
8.8.3 If all or part of any indemnification obligation under this
Agreement is not paid when due, then the Indemnifying Party shall
pay the Indemnified Party interest on the unpaid principal amount
of the obligation from the date the amount became due until
payment in full, at the per annum rate of interest announced from
time to time by NationsBank South, N.A., to be its "prime rate."
8.9 SURVIVAL. The provisions of this Article 8 shall survive the
termination of this License Agreement.
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ARTICLE 9 - LIMITATION OF LIABILITY
NEITHER PARTY SHALL BE LIABLE TO THE OTHER PARTY IN TORT, CONTRACT OR OTHERWISE
FOR ANY LOST PROFITS, SPECIAL, INDIRECT, INCIDENTAL, PUNITIVE OR CONSEQUENTIAL
DAMAGES ARISING OUT OF, OR IN CONNECTION WITH THIS LICENSE AGREEMENT THAT THE
OTHER PARTY, OR ANY THIRD PARTY, MAY INCUR, EXPERIENCE OR CLAIM, EVEN IF THE
PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH CLAIM.
ARTICLE 10 - CONFIDENTIALITY
In the course of exercising this License Agreement each party will likely obtain
Confidential Information of the other party. The parties agree to safeguard
against the unauthorized use and disclosure of any Confidential Information and
to use the same degree of care that each uses to protect its own information of
a similar nature, but in no event less than a reasonable degree of care under
the circumstances. Neither party to this License Agreement will disclose the
other party's Confidential Information to any third person, except (i) with the
prior written consent of the other party; (ii) to the extent necessary to comply
with law or legal process, in which event the party making the disclosure will,
subject to applicable law, notify the other party as promptly as practicable
prior to making any disclosure and seek confidential treatment of the
information; (iii) to the extent necessary, as a part of its normal reporting or
review procedure to its parent company, or its auditors and attorneys on a
confidential basis; or (iv) in connection with the enforcement of the party's
rights hereunder or under any related agreements. The parties hereto agree to
restrict disclosure of the Confidential Information solely to its employees or
others under its control who have a need to know the same in furtherance of the
purposes of this License Agreement and who have been directed and contractually
or legally restricted from disclosing the Confidential Information at least to
the degree required under this License Agreement. Each party shall be liable to
the other for any breach of the covenants of confidentiality contained herein by
its agents or employees. The provisions of this section shall survive the
expiration or termination of this License Agreement.
ARTICLE 11 - ASSIGNMENT
11.1 BY SBCL. SBCL may assign all of its rights and obligations under this
License Agreement or any license granted hereunder to any Affiliate, or
to any corporation or other entity pursuant to a merger, consolidation,
or other reorganization. SBCL agrees to notify ActaMed of any such
assignment, in writing, specifying the name and address of the other
entity.
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11.2 BY ACTAMED. ActaMed may assign all of its rights and obligations under
this License Agreement or any license granted hereunder to any Affiliate
or to any other corporation or other entity pursuant to a merger,
consolidation, or other reorganization. ActaMed agrees to notify SBCL
at least thirty (30) days prior to the date of any such assignment, in
writing, specifying the name and address of the assignee.
Notwithstanding the foregoing:
(i) Nothing in this License Agreement shall be construed to
authorize ActaMed to assign this License Agreement to any
assignee if such assignee or any Affiliate of the
assignee is engaged in the business of performing
laboratory services similar to those performed by SBCL as
of the date of the assignment, and
(ii) SBCL shall have the right to require ActaMed to void the
assignment if the assignee or any Affiliate of the
assignee enters the business of performing laboratory
services similar to those performed by SBCL as of the
date of this Agreement or the date of the assignment.
11.3 OTHER. Except as expressly set forth in this Article 11 and except as
the other party may consent in writing, neither party may assign or
transfer this License Agreement or any right or obligation hereunder to
any third party, and any attempt to do so in contravention of this
Article 11 shall be void and shall have no force or effect.
ARTICLE 12 - DISPUTE RESOLUTION
12.1 INFORMAL DISPUTE RESOLUTION. Any dispute between the parties arising out
of or with respect to this License Agreement, either with respect to the
interpretation of any provision of this Agreement or with respect to the
performance by ActaMed or SBCL, shall be resolved as provided in this
Article.
12.1.1 Prior to the initiation of formal dispute resolution procedures,
the parties shall first attempt to resolve their dispute
informally, as follows:
(i) The Representatives (as defined in the Services
Agreement) for each party shall meet for the purpose of
endeavoring to resolve such dispute. They shall meet as
often as the parties reasonably deem necessary in order
to gather and furnish to the other all information with
respect to the matter in issue which the parties believe
to be appropriate and germane in connection with its
resolution. The Representatives shall discuss the
problem and negotiate in good faith in an effort to
resolve the dispute without the necessity of any formal
proceeding. During the course of negotiations, all
reasonable requests made by one party to another for
nonprivileged information, reasonably
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related to this Agreement, shall be honored in order that
each of the parties may be fully advised of the other's
position.
(ii) If, within fifteen (15) days after a matter has been
identified for resolution pursuant to this Article,
either of the Representatives concludes in good faith
that amicable resolution through continued negotiation in
this forum does not appear likely, the matter will be
escalated by formal written notification to the SBCL
President and the ActaMed President (both as defined in
the Services Agreement). The parties will use their
respective best efforts to cause the SBCL President and
the ActaMed President to meet to attempt to resolve the
dispute.
(iii) Formal proceedings for the resolution of a dispute may
not be commenced until the earlier of: (i) the date on
which the SBCL President and the ActaMed President
conclude in good faith that amicable resolution through
continued negotiation of the matter does not appear
likely; or (ii) thirty (30) days after the dispute has
been referred to the SBCL President and the ActaMed
President.
12.1.2 The provisions of this Article 12 shall not be construed to
prevent a party from instituting, and a party is authorized to
institute, formal proceedings earlier to avoid the expiration of
any applicable limitations period.
12.2 ARBITRATION. If the parties are unable to resolve any controversy
arising under this Agreement as contemplated by Section 12.1 and if such
controversy is not subject to Section 12.3 or Section 12.4, then such
controversy shall be submitted to mandatory and binding arbitration at
the election of either Party (the Disputing Party) pursuant to the
following conditions:
12.2.1 The Disputing Party shall notify the AAA and the other Party in
writing describing in reasonable detail the nature of the dispute
(the "DISPUTE NOTICE"). The parties shall each select a neutral
arbitrator in accordance with the rules of AAA and the two (2)
arbitrators selected shall select a third neutral arbitrator.
The three (3) arbitrators so selected are herein referred to as
the "PANEL."
12.2.2 The Panel shall allow reasonable discovery as permitted by the
Federal Rules of Civil Procedure, to the extent consistent with
the purpose of the arbitration. The Panel shall have no power or
authority to amend or disregard any provision of this Article 12.
The arbitration hearing shall be commenced promptly and conducted
expeditiously, with each of ActaMed and SBCL being allocated
one-half of the time for the presentation of its case. Unless
otherwise agreed to by the parties, an arbitration hearing shall
be conducted on consecutive days.
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12.2.3 Should any arbitrator refuse or be unable to proceed with
arbitration proceedings as called for by this Section, such
arbitrator shall be replaced by an arbitrator selected in
accordance with the rules of the AAA and consistent with this
Article 12.
12.2.4 The Panel rendering judgment upon disputes between parties as
provided in this Article 12 shall, after reaching judgment and
award, prepare and distribute to the parties a writing describing
the findings of fact and conclusions of law relevant to such
judgment and award and containing an opinion setting forth the
reasons for the giving or denial of any award. The award of the
arbitrator shall be final and binding on the parties, and
judgment thereon may be entered in a court of competent
jurisdiction.
12.2.5 Arbitration hearings hereunder shall be held in Washington D.C.
or another mutually agreeable location.
12.2.6 The Panel shall be instructed that time is of the essence in the
arbitration proceeding. The Panel shall render its judgment or
award within fifteen (15) days following the conclusion of the
hearing. Recognizing the express desire of the parties for an
expeditious means of dispute resolution, the arbitrator shall
limit or allow the parties to expand the scope of discovery as
may be reasonable under the circumstances.
12.3 IMMEDIATE INJUNCTIVE RELIEF. The nonbreaching party may file a pleading
with a court seeking immediate injunctive relief in the event the other
party commits a breach of the confidentiality obligations set forth in
this Agreement, SBCL violates the limitations imposed by Section 3.2
hereof, ActaMed violates the limitations imposed by Section 2.2 or 2.3
hereof, or in the event a party makes a good faith determination that a
breach of the terms of this Agreement by the other party is such that
the damages to such party resulting from the breach will be so
immediate, so large or severe, and so incapable of adequate redress
after the fact that a temporary restraining order or other immediate
injunctive relief is a necessary remedy. If a party files a pleading
with a court seeking immediate injunctive relief and this pleading is
challenged by the other party and the injunctive relief sought is not
awarded in substantial part (or in the event of a temporary restraining
order is vacated upon challenge by the other party), the party filing
the pleading seeking immediate injunctive relief shall pay all of the
costs and attorneys fees of the party successfully challenging the
pleading.
12.4 JURISDICTION. ActaMed and SBCL each consent to venue in Philadelphia,
Pennsylvania and to the nonexclusive jurisdiction of competent
Pennsylvania state courts or federal courts located in Philadelphia for
all litigation which may be brought, subject to the requirement for
arbitration hereunder, with respect to the terms of, and the
transactions and relationships contemplated by, this Agreement.
12.5 CONTINUED PERFORMANCE; CONTINUATION OF LICENSES. Each party agrees to
continue performing its obligations under this Agreement while any
dispute is being resolved unless
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and until such obligations are terminated or expire in accordance with
the provisions by the termination or expiration of this Agreement not
in dispute. Nothing in this Agreement shall be construed as altering
the perpetual and irrevocable nature of the licenses granted by this
Agreement or as authorizing any arbitrator or court in any way to
enjoin or otherwise interfere with the proper exercise of such
licenses by either party hereto.
ARTICLE 13 - MISCELLANEOUS
13.1 FURTHER ASSURANCES. From time to time SBCL and ActaMed and their
respective officers, employees, contractors, representatives and agents,
shall confirm the provisions of this Agreement by execution and delivery
of such assignments, confirmations or other written instruments as may
be reasonably requested by the other party in order to vest each party
with the rights mentioned in this Agreement. ActaMed and SBCL shall
obtain appropriate assignments, covenants and obligations from its
officers, employees, representatives, agents and any contractors hired
to carry out its obligations under the SCAN Agreements prior to their
performance thereof to ensure SBCL or ActaMed, as the case may be, may
own the rights specified in this Agreement.
13.2 INTEGRATION. This License Agreement (including all of the Schedules
hereto) supersedes all prior agreements and understandings between the
parties with respect to the subject matter of this License Agreement,
and is intended by the parties as the complete and exclusive statement
of their agreement, and supersedes all prior understandings and
agreements, whether oral or written, between the parties with respect to
the same subject matter.
13.3 FORCE MAJEURE. Each party shall be excused from delays in performing or
from its failure to perform hereunder to the extent that such delays or
failures result from causes beyond the reasonable control of such party;
PROVIDED that, in order to be excused from delay or failure to perform,
such party must act diligently to remedy the cause of such delay or
failure.
13.4 NO AGENCY. Each party hereto, is acting solely as an independent
contractor. In no way is either party to be construed as the agent or
to be acting as the agent of the other party in any respect. Each party
has the sole obligation to supervise, manage, contract, direct, procure,
perform, or cause to be performed all work to be carried out by such
party under any SCAN Agreement.
13.5 NO WAIVER. No delay or omission by either party to exercise any right
arising upon any noncompliance with, or breach of, any covenant,
condition or agreement to be performed by the other party shall impair
any such right or be construed to be a waiver thereof. A waiver by
either of the parties hereto of any noncompliance with, or breach of,
any covenant, condition or agreement to be performed by the other
party must be in writing and signed by both parties. No waiver of any
right upon any one occurrence of noncompliance or breach
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<PAGE>
shall be construed to be a waiver of any succeeding noncompliance or
breach. Unless stated otherwise, all remedies provided for in this
License Agreement shall be cumulative and in addition to and not in
lieu of any other remedies available to either party at law, in
equity, or otherwise.
13.6 SEVERABILITY. If any term, covenant, condition or provision of this
License Agreement or the application thereof to any circumstance shall
be invalid or unenforceable to any extent, the remaining terms,
covenants, conditions and provisions of this License Agreement shall not
be affected thereby and each remaining term, covenant, condition and
provision of this License Agreement shall be valid and enforceable to
the fullest extent permitted by law. If any provision of this License
Agreement is so broad as to be unenforceable, such provision shall be
interpreted to be only as broad as is enforceable.
13.7 NOTICES. If one party is required or desires to give notice to the
other, such notice shall be deemed given if mailed by U.S. mail, first
class, postage prepaid, or via a nationally recognized overnight
carrier, with all freight charges prepaid, and addressed as follows (or
as subsequently noticed to the other party):
If to SBCL: SmithKline Beecham Clinical Laboratories, Inc.
1201 S. Collegeville Road
Collegeville, PA 19426
ATTN: [*]
If to ActaMed: ActaMed Corporation
7000 Central Parkway Suite 600
Atlanta, GA 30328
ATTN: MIKE HOOVER
13.8 GOVERNING LAW; INTERPRETATION. This License Agreement shall be
construed, interpreted and enforced under the laws of the Commonwealth
of Pennsylvania, excluding its provisions regarding conflicts of law.
The section and subsection headings used herein are for reference and
convenience only, and shall not enter into the interpretation hereof.
[*] 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.
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<PAGE>
IN WITNESS WHEREOF, the parties have caused this License Agreement to be
executed on the date set forth below.
SMITHKLINE BEECHAM CLINICAL ACTAMED CORPORATION
LABORATORIES, INC.
BY: /s/ John B. Okkerse, Jr. BY: /s/ Michael K. Hoover
--------------------------- -------------------------
NAME: John B. Okkerse, Jr. NAME: Michael K. Hoover
--------------------------- -------------------------
TITLE: President TITLE: President
--------------------------- -------------------------
DATE: 12-31-97 DATE: 12-31-97
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<PAGE>
SCHEDULE A
SBCL SOFTWARE
- SBCL proprietary Software known as [*] (including without limitation
the [*]) and [*].
- Download programs and routines and other SBCL proprietary Software
reasonably required to perform Information Services as SBCL is
performing them as of the date of the License Agreement.
- Documentation owned by SBCL and related to any of the foregoing.
- Specifications owned and possessed by SBCL with respect to the
foregoing.
- Such Specifications for the Software known as [*] and [*] as SBCL
determines reasonably necessary for the SBCL Software, SCAN Developments
and ActaLab Software [*] and [*].
- Such updates, upgrades, corrections, modifications, and enhancements to
any of the foregoing created during the term of the Services Agreement.
- All patents, patent applications, copyrights, trade secrets, know-how,
information and other intellectual property rights that are currently
owned or controlled by SBCL and that are embodied or practiced in the
foregoing.
[*] 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.
<PAGE>
SCHEDULE B
AMENDMENTS TO DEVELOPMENT AGREEMENT
SBCL and ActaMed hereby agree this day of December, 1997, to amend their
Development Agreement October 31, 1997, as set forth herein as of the effective
dates set forth herein.
1. Effective as of the date of the Development Agreement, Article I
of the Development Agreement is hereby amended to include the following
additional or revised definitions:
"ActaLab Software" has the meaning ascribed to it by the License
Agreement.
"Deliverable" means all Software, Documentation and other
materials developed by ActaMed under this Agreement and described in a
Statement of Work.
"License Agreement" means that certain License Agreement between
SBCL and ActaMed dated December 22, 1997.
"SBCL Software" has the meaning ascribed to it by the License
Agreement.
"SOW No. 1" shall mean the Statement of Work dated October 31,
1997.
2. The second "Whereas" clause is hereby deleted.
3. The fourth "Whereas" clause is hereby revised to delete the words
"to SBCL."
4. Section 5.1(a) of the Development Agreement is hereby revised as
of the date of the Development Agreement to read as follows:
(a) The parties hereby acknowledge and agree that:
(i) The Deliverables under SOW No. 1 do not
[*] the SBCL Software, but instead [*] which will be used in conjunction
with and/or will be integrated into ActaMed's ProviderLink software.
All Deliverables (including but not limited to, the ActaLab Software)
under SOW No. 1, and all intellectual property rights (including but not
limited to copyrights and all renewals and extensions thereof) in such
Deliverables, shall be [*]. Subject to the provisions of Section
5(a)(iv) hereof, SBCL hereby grants, transfers and assigns all of its
right, title and interest in such Deliverables, including patents,
copyrights, trade secrets and other intellectual property developed or
acquired in the course of creating such Deliverables, to ActaMed and
ActaMed shall have the right to obtain and hold in its own name
copyrights,
[*] 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.
<PAGE>
patents, registrations and similar protections which may be available
with respect to such Deliverables.
(ii) The parties contemplate that additional
SOWs may be entered into from time to time for the purpose of enhancing,
modifying or upgrading the ActaLab Software (an "ActaLab SOW"). All
Deliverables under an ActaLab SOW and all intellectual property rights
(including but not limited to copyrights and all renewals and extensions
thereof) in such Deliverables, shall be [*]. Subject to the provisions
of Section 5(a)(iv) hereof, SBCL hereby grants, transfers and assigns all
of its right, title and interest in such Deliverables, including patents,
copyrights, trade secrets and other intellectual property developed or
acquired in the course of creating such Deliverables, to ActaMed and
ActaMed shall have the right to obtain and hold in its own name
copyrights, patents, registrations and similar protections which may be
available with respect to such Deliverables.
(iii) The parties contemplate that additional
SOWs may be entered into from time to time for the purpose of enhancing,
modifying or upgrading the SBCL Software (a "SCAN Development SOW").
Ownership of any Deliverables under a SCAN Development SOW, and
ownership of any intellectual property rights therein (including but not
limited to copyrights and all renewals and extensions thereof), shall be
governed in all respects by Article 3 of the License Agreement. Subject
to the provisions of Section 5(a)(iv) hereof, ActaMed hereby grants,
transfers and assigns all of its right, title and interest in such
Deliverables, including patents, copyrights, trade secrets and other
intellectual property developed or acquired in the course of creating
such Deliverables, to SBCL.
(iv) Nothing in this Section 5(a) shall be
construed to transfer to ActaMed, or otherwise divest SBCL of SBCL's
ownership of, the SBCL Software and, subject to the licenses granted by
the License Agreement, SBCL (as between SBCL and ActaMed) shall be the
sole owner of the patents, copyrights, trade secrets and other
intellectual property rights therein. Nothing in this Section 5(a)
shall be construed to transfer to SBCL, or otherwise divest ActaMed of
ActaMed's ownership of, any software or work of authorship owned by
ActaMed as of the effective date of the Development Agreement and,
subject to the licenses granted by the License Agreement, ActaMed (as
between SBCL and ActaMed) shall be the sole owner of any patent,
copyright, trade secret right or other intellectual property right
therein.
(v) Any Statement of Work, by mutual agreement
of the parties, may include limitations and restrictions on ActaMed's use of the
applicable Deliverables in support of laboratory testing services of commercial
laboratories other than SBCL.
6. Sections 5.1(d) and (e) and Section 5.2(a) as of the date of this
Amendment are hereby deleted from the Development Agreement.
[*] 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.
<PAGE>
7. In the event of conflict between the Development Agreement and
the License Agreement, the License Agreement shall control.
9. Except as expressly set forth herein, the Development Agreement
shall continue in full force and effect as originally executed by the parties.
10. Nothing in this Agreement shall be construed to modify or change
in any respect the ownership and use rights with respect to Exclusive
Developments (as defined in the Services Agreement between SBCL and ActaMed
dated the date hereof) pursuant to the License Agreement and Section V of said
Services Agreement.
In witness whereof, the parties have caused this Amendment to be
signed this day of December, 1997.
SMITHKLINE BEECHAM CLINICAL ACTAMED CORPORATION
LABORATORIES, INC.
BY: /s/ BY: /s/
---------------------------- ---------------------------
NAME: John B. Okkersee Jr. NAME: Michael K. Hoover
-------------------------- -------------------------
TITLE: President TITLE: President
------------------------- ------------------------
DATE: DATE:
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