MANAGEMENT SUPPORT AND MARKETING AGREEMENT

Exhibit 10.12

 

MANAGEMENT SUPPORT AND MARKETING AGREEMENT

 

This MANAGEMENT SUPPORT AND MARKETING AGREEMENT (“Agreement,”) entered into and effective as of the 1st day of September, 2002 (notwithstanding the date of actual execution) by and between DOCTORS PRACTICE MANAGEMENT, INC., A Texas business corporation (“DPM”), and MEDICAL MULTIMEDIA ADVERTISING, INC. (“MMA”).

 

WITNESSETH:

 

WHEREAS, MMA is a duly and validly existing Texas corporation that has been organized for the purpose of providing investment opportunities and management support and marketing services for medical and related healthcare providers (“Healthcare Services”) to the general public in the Greater Houston, Texas area;

 

WHEREAS, DPM is experienced in providing management and related items and services to physicians, professional associations, and other professional healthcare entities and individuals and has been engaged as manager by VISTA COMMUNITY MEDICAL CENTER, L.L.C., (“VISTA”) a Texas business corporation organized for the purpose of operating an outpatient surgical and diagnostic clinic and providing medical and related healthcare services (“Healthcare Services”) in the Greater Houston, Texas area;

 

WHEREAS, DPM desires and intends to obtain such management, administrative, and business services necessary and appropriate for VISTA’S business operations and the provision of Healthcare Services by VISTA, and MMA is capable of assisting DPM in providing, all such management, administrative, and business services; and

 

WHEREAS, DPM and MMA mutually desire an arrangement that:

 

(1)

ensures consistency of service, quality of care, and safety of VISTA’S patients;

 

(2)

facilitates effective utilization of Healthcare Services;

 

(3)

ensures consistent and customary patterns for the provision of Healthcare Services;

 

(4)

facilitate the establishment and maintenance of a public image of excellence and high quality for VISTA, all for the benefit of those persons seeking Healthcare Services as patients of VISTA.

 

NOW, THEREFORE, for and in consideration of the mutual covenants set forth herein, and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged and confessed, the parties agree as follows:

 

Covenants and Conditions Regarding Management and Advertising:

 

1.1 MMA agrees that it has the primary responsibility for the marketing of the facilities, including but not limited to the following:

 

(a)

recruitment of physicians as tenants in the professional building;

 

(b)

recruitment of physicians to use and otherwise employ the services of the hospital;

 

(c)

general efforts to improve the reputation and market the benefits of VISTA; and

 

(d)

create and publish multi-media advertising (subject to advance DPM approval).

 

1.2 DPM agrees to pay Two Hundred Thousand Dollars ($200,000.00) a month to be used for advertising and to pay fees and expenses of MMA. MMA and DPM agree that these funds will be deposited in an account to be managed and controlled solely by MMA. From these funds, MMA agrees to expend at least $165,000.00 monthly, directly on advertising and the general marketing of VISTA, and the associated services of the Vista Medical Center at 1401 and 1401A Vista, Pasadena, Texas. Further, MMA will provide to DPM a written report and verification of these expenditures quarterly, with said report being due not later than thirty (30) days after the end of each respective quarter.

 

1.3 Management and Clerical Personnel. MMA shall employ or otherwise retain, and shall be responsible for selecting, training, supervising, scheduling, and terminating, all management and clerical personnel as MMA deems reasonably necessary and appropriate in the performance of its duties and obligations under this Agreement. MMA shall have sole responsibility for determining the salaries, wages, and fringe benefits of all such management and clerical personnel, for paying such salaries and wages, and for providing such fringe benefits, and for withholding as required by law, any sums for income tax, unemployment insurance, social security, or any other withholding required by applicable law or governmental requirement.

 

1.4 Insurance. Throughout the Term, MMA shall, at MMA’s expense, obtain and maintain with commercial carriers, through captive insurance companies, through self-insurance, or some combination thereof, professional, casualty, and comprehensive general liability insurance covering MMA, its personnel, and all of its equipment in such amounts, on such basis, and upon such terms and conditions as DPM deems appropriate.

 

1.5 Indemnification by MMA. MMA shall indemnify and hold DPM harmless from and against any and all liability losses, damages, claims, causes of action, and expenses, including, without limitation, reasonable attorney’s fees and associated costs, associated with or resulting, directly or indirectly, from any act or omission of MMA, its employees, agents, or independent contractors in or about the Facility during the Term. To be entitled to such indemnification, DPM shall give MMA prompt written

 

Management Support And Marketing Agreement

Between Doctors Practice Management, Inc. and Medical Multimedia Advertising, Inc.

(dynacy/doctorspractice/contracts)

 

Page 2 of 9

notice of the assertion by a third party of any claim with respect to which DPM might bring a claim for indemnification hereunder, and in all events must provide such written notice to MMA within the applicable period for defense of such claim by MMA. MMA shall, at its own expense, have the right to defend and litigate any such third-party claim.

 

2.1 Organization and Existence. DPM is a Texas corporation duly organized, validly existing and in good standing under the laws of the State of Texas and has all requisite legal and corporate power to carry on its business as now conducted and to enter into and perform this Agreement.

 

2.2 Compliance with Laws. DPM is in compliance in all material respects with all applicable foreign, federal, state, municipal and other political subdivision or governmental agency statutes, ordinances and regulations, including, without limitation, those imposing taxes, in every applicable jurisdiction in respect of the ownership of DPM properties and conduct of DPM’s business.

 

2.3 Brokers. DPM in not a party to or in any way obligated under any contract or other agreement for, and there are no outstanding claims against DPM for the payment of any broker’s or finder’s fee in connection with the origin, negotiation, execution or performance of this Agreement.

 

2.4 DPM’s Authority Relative to this Agreement. The execution, delivery and performance of this Agreement by DPM has been duly authorized and approved by the Board of Directors and no further corporate action is necessary on the part of DPM to make this Agreement valid and binding upon DPM in accordance with its terms. Neither the execution, delivery nor performance of this Agreement by DPM will result in a violation or breach of any term or provision under the Articles of Incorporation or Bylaws of DPM or constitute a default or breach of, or accelerate the performance required under, any indenture, mortgage, deed of trust or other contract or agreement to which DPM is a party or by which it or any of its respective assets are bound, or, violate any order, writ, injunction or decree of any court, administrative agency or governmental body.

 

3.1 Organization and Existence. MMA is a Texas corporation duly organized pursuant to the laws of Texas and in good standing, and has all requisite legal power to enter into and perform this Agreement.

 

3.2 Authority Relative to this Agreement. The execution, delivery and performance of this Agreement has been duly authorized, and no further action is necessary on the part of MMA to make this Agreement valid and binding upon MMA in accordance of its terms. Neither the execution, delivery nor performance of this Agreement by MMA will result in a violation or breach of any term or provision or constitute a default or breach of, or accelerate the performance required under any other contract or agreement to which MMA is a party or by which it or its properties are bound, or violate any order, writ, injunction or decree of any court, administrative agency or governmental body.

 

Management Support And Marketing Agreement

Between Doctors Practice Management, Inc. and Medical Multimedia Advertising, Inc.

(dynacy/doctorspractice/contracts)

 

Page 3 of 9

3.3 Brokers. MMA is not a party to or in any way obligated under any contract or agreement for, and there are no outstanding claims against MMA for the payment of any broker’s or finder’s fee in connection with the origin, negotiation, execution, or performance of this agreement.

 

4.1 Confidential Information. MMA acknowledges that in the course of the performance of this Agreement, it has had and will continue to have access to certain know-how, formulae, processes, data, proprietary information, supplier and patient records and information and other confidential knowledge and trade secrets of DPM’s and VISTA’s business and operations. MMA understands that all such information is confidential and has been or will be conceived or learned by MMA in confidence, and agrees not to reveal any such information to any third person for any reason or under any circumstances. MMA further agrees that it will at no time use any such information for the purpose of competing with or assisting others in competing with the business of DPM or VISTA, or for any purpose which may be harmful or detrimental to the business or interests of DPM or VISTA. The restrictions in this section shall not apply and shall not prohibit the use or disclosure of such confidential information (i) to the extent required by law or court order, or other administrative order in any litigation, arbitration, or similar proceeding; (ii) to the extent such information becomes publicly available other than through a breach of this section; or (iii) to the extent such information would become necessary to support any claim arising between the parties; or (iv) with the written agreement of DPM and VISTA. The parties agrees that any remedy at law for actual or threatened breach of the provisions of this section would be inadequate and that DPM or VISTA shall be entitled to specific performance thereof or injunctive relief by temporary or permanent injunction or such other appropriate judicial remedy, writ or order as may be entered by a court of competent jurisdiction. Any such remedy shall be in addition to any damages which DPM or VISTA may be legally entitled to recover as a result of any breach by the other party of the provisions of this section, and MMA hereby waives any requirement for the securing or posting of any bond in connection with obtaining any such injunctive or other equitable relief.

 

5.1 Initial and Renewal Terms. The term of this Agreement will be for three (3) years commencing as of October 15, 2003, and expiring as of October 15 2006, unless and until terminated as provided hereinafter (“the Term”). DPM is hereby granted and shall, if not at the time in default under this Agreement, have at its sole discretion, an option to extend the term of this Agreement for two (2) years under the same terms contained herein. This option shall be exercised only by DPM’s delivering to MMA before the termination of the original Term written notice of DPM’s election to extend the Term of this Agreement as provided herein.

 

5.2 Termination by DPM. DPM may terminate this Agreement upon thirty (30) days written notice to MMA.

 

5.3 Termination by MMA. MMA may terminate this Agreement upon the occurrence of the dissolution of DPM, or if DPM fails to pay MMA the advertising dollars as provided for in sec. 1.3 of this Agreement within thirty (30) days of the date such amounts are due.

 

Management Support And Marketing Agreement

Between Doctors Practice Management, Inc. and Medical Multimedia Advertising, Inc.

(dynacy/doctorspractice/contracts)

 

Page 4 of 9

5.4 Termination by Agreement. In the event MMA and DPM shall mutually agree in writing, this Agreement may be terminated on the date specified in such written agreement.

 

5.5 Bankruptcy.