User Agreement

VALIDCARE, LLC
EXHIBIT 1 TO SUPPLIER USER AGREEMENT

(FOR REVIEW ONLY)

TERMS AND CONDITIONS

ARTICLE 1 

BACKGROUND

VALIDCARE operates an on-line, independent app and web-based Customer Experience Platform (the “Platform”) intended to facilitate the real-time, secure transfer of information, money, goods and services between suppliers of products (“Product Supplier”) and current or potential purchasers or consumers of products, known herein as Customers (“Customers” and “Customer Community”).

(“Supplier”) is a Product Supplier company, who desires to use the VALIDCARE Platform with its Customers.

The “Territory” of the Agreement is the United States where Supplier legally conducts commerce directly or through Supplier Affiliates.

VALIDCARE and Supplier now desire to permit Supplier and its approved Supplier Affiliates to gain market insights from Customers and/or to supply Product information for display on the Platform to Customers, and/or to market or sell Products using the Platform.

Customers are authorized to use the Platform after entering into agreement with VALIDCARE via separate Terms and Conditions based on their access and use.

 

ARTICLE 2
THE PLATFORM

2.1.  The Platform.  The Platform provides Supplier(s) with the ability to engage in two-way communication with its Customer Community via a secure, privately branded, configurable, app-based software enabling the sharing, collection and reporting of real time: (i) product catalog & education information (ii) ordering, fulfillment rewards and loyalty programs, for commercial and compassionate use products, (iii) market intelligence and product surveillance activities, (iv) targeted, direct to Customer communications. VALIDCARE grants to Supplier, for the term of this Agreement, a non-exclusive right and license to access and use some or all of the features of the Platform solely for Supplier’s internal use in the Territory, as stipulated in a Statement of Work(s) attached as an Exhibit 2 to this Agreement.

2.2.  Authority and Amendments.  Supplier represents and warrants that it is duly authorized to enter into this Agreement.

2.3.  Upgrades.  Updates and upgrades of the Platform services or software may be implemented by VALIDCARE from time to time.  Such updates and upgrades are included in the services, will not result in additional charges to Supplier, and will not be subject to acceptance or rejection by Supplier.

2.4.  Hardware and Software.  Supplier will be responsible for obtaining and maintaining all hardware and software necessary to access the Internet and the Platform.

2.5.  Services.  VALIDCARE, in its sole discretion, may enhance, delete or modify the features, format, “look and feel,” functions or services of the Platform, the procedures for use of the Platform, or the information offered on the Platform, except to the extent that such changes prevent Suppliers from complying with applicable laws and regulations (collectively, “Requirements of Law”), including Product labeling and other marking requirements and other marketing and distribution regulations.

 

ARTICLE 3
CONTRACT FORMATION

VALIDCARE is not a party to the contracting or sale of Products between Platform Suppliers and will not acquire title to Products or otherwise bear the risk of product performance.  VALIDCARE will not intentionally influence the terms of any contracts between Platform Suppliers and will allow Suppliers of competing products to use the Platform to differentiate their brand and Customer experience.  VALIDCARE will not intentionally influence the distribution channel of any Product.

 

ARTICLE 4
SECURITY

4.1.  Identification.  VALIDCARE will provide Supplier with log-on identifications and passwords (each, an “Identification”) for its representatives approved to use the Platform.  Each of Supplier’s authorized representatives must have a unique Identification to access the Platform.  Supplier shall use best efforts: (i) to protect the security of each Identification; (ii) not to permit individuals other than employees or contractors approved by it to use each Identification to gain access to the Platform; (iii) not to disclose any Identification to any person except on a need-to-know basis; and (iv) to ensure that approved employees or contractors access the Platform only in connection with Supplier’s business purposes.  Supplier will provide VALIDCARE prompt notice of the loss or unauthorized disclosure of any Identification. 

4.2.  Platform Security.  VALIDCARE will use best efforts to maintain the security of the Platform, including, without limitation, constructing and maintaining firewalls and other security devices to limit any unauthorized access to information accessible from the Platform.  VALIDCARE and Supplier each will use best practices to avoid introducing into the other’s computers any “computer virus,” “trojan horse,” “worm” or other malicious computer code.   Except in furtherance of the purposes set forth in Section 2.1 of this Exhibit, Supplier may not upload, download, modify, disassemble, decompile, or copy VALIDCARE Intellectual Property or otherwise take any action that may affect the use or functionality of the Platform.

4.3.  Privacy.  Supplier will not breach or attempt to breach Platform computer or software security, attempt to access the information of another Supplier or otherwise invade the privacy of others in connection with its use of the Platform.

Platform Standards.  Supplier will use its commercially reasonable efforts to: (i) update Product Data whenever it becomes inaccurate, including, without limitation, providing updated catalog information and pricing where applicable; (ii) respond promptly to Customer reports of adverse effects related to Supplier’s products; (iii) not represent any fraudulent, unauthorized, contraband, or stolen merchandise; (iv) not infringe any valid and enforceable third party rights, including, without limitation, copyright, patent, trademark, trade secret or other proprietary rights or rights of publicity or privacy; (v) not include any obscene, indecent or pornographic content; (vi) not include any inaccurate, defamatory, libelous, illegal, threatening, harassing content or content against public policy or content which is otherwise objectionable; (vii) not include any content that is prohibited by this Agreement; (viii) meet all standards set forth by VALIDCARE pursuant to this Agreement; and (ix) not publish misbranded Products or other Products that do not meet the Requirements of Law.  VALIDCARE may refuse to publish or display Product Data on the Platform if Supplier fails to comply with the requirements of this or may terminate this Agreement pursuant to Section 6.2 of this Exhibit. 

 

ARTICLE 5
OWNERSHIP, CONFIDENTIALITY AND LICENSES

5.1.  Definitions. The following terms will have the indicated meanings:

“Aggregated Data” means a compilation of multiple Platform Suppliers’ Customer Data concerning which VALIDCARE has used best practices to ensure that no individual, particular Customer or entity can be identified. 

“Catalog” means the Product Data of multiple VALIDCARE Suppliers organized according to VALIDCARE’s classification scheme. 

“Customer” means any person or entity who is known by Supplier to be a prospective, current or past purchaser or consumer of Supplier’s product(s) and has not requested to be unsubscribed from communication with Supplier.

 “Customer Registry Data” means unique email addresses for Supplier’s Customers provided by Supplier to VALIDCARE.

“Distributor” means any distributor of goods manufactured by others, whether acting as a Supplier or Customer.

“Intellectual Property” means any and all copyrights, patents, patent registration rights, business processes, data rights, mask works, Marks and associated goodwill, trade secrets, know how, moral rights, design and so-called “look and feel” and graphical Supplier interface, data flows, product and connectivity specifications, schematics, documentation, source code and object code, data maps and definitions, and other proprietary rights arising or enforceable under any U.S. law, foreign law, or international treaty regime.

“Marks” means all trademarks, trade names, service marks, service names and logos, worldwide.

“Product Data” means Product information that a Supplier provides to VALIDCARE for display on the Platform, to communicate to Customers including, without limitation, Product descriptions, Product specifications, Marks, catalog prices, catalogs, directions for use, text, pictures, sound, video and other data.

“Product Supplier” means a person or entity or authorized agent therein who sells or has the opportunity to sell products to a Customer.  For clarity, a Product Supplier may include but is not limited to a manufacturer, distributor, retailer, dispensary, and/or reseller of Products.

“Supplier Affiliate” means a person or entity or authorized agent of a Supplier who sells or has the opportunity to sell Supplier’s products to a Customer.  For clarity, a Supplier Affiliate may include but is not limited to a manufacturer, distributor, dispensary, and/or reseller of Products.

“Supplier Data” means any information communicated (i) by VALIDCARE to a Supplier, (ii) by Supplier to VALIDCARE, or (iii) between a Supplier and Customer through the Platform that relates to Product(s), education, market information, and information or active participation in rewards/loyalty programs, advocacy and research opportunities, and product surveillance activities including summaries of such information. 

5.2.  Ownership By VALIDCARE.  As between VALIDCARE and Supplier, VALIDCARE owns, and will own, all right, title and interest in and to all Intellectual Property, whether now existing or hereafter arising, embodied in or associated with: (i) VALIDCARE; (ii) the Platform (including, without limitation, all web pages of the Platform and VALIDCARE’s proprietary schema and document type definitions); (iii) VALIDCARE’s Marks; (iv) the Catalog; and (v) Aggregated Data, but excluding in each of (i) through (v) above, Product Data, and Supplier’s Marks.  The Intellectual Property described in this Section 5.2 constitutes the “VALIDCARE Intellectual Property.”

5.3.  Ownership By Third Parties.  The Platform contains third-party Marks and other Intellectual Property belonging to third parties.  All such Intellectual Property is and will remain the property of its respective owners.  Except as set forth in Section 2.1 of this Exhibit, access to the Platform does not grant a right to Supplier to copy or use any such Intellectual Property.

5.4.  Ownership By Supplier. 

5.4.1.        Customer Data.  Customers will submit data via the Platform based on the services elected by Customer and be subject to the Terms and Conditions agreed to between Customer and VALIDCARE.   As between Supplier and VALIDCARE, to the extent allowable by law, Supplier will own all Customer Data jointly with Customers that are a party to the communication generating the Customer Data where Customer input a Supplier specific code upon registration on the Platform. Customer has the right to discontinue or retract data at any time per the Terms of Service with VALIDCARE in compliance with VALIDCARE’s business terms and with the regulations of the country or locality where the Customer resides.  

5.4.2.        Supplier will be solely responsible for maintaining and sharing Customer Registry Data with VALIDCARE on a minimum of a monthly basis in the format specified by VALIDCARE.  If Supplier fails to provide Customer Registry Data which meets these requirements or fails to keep Customer Registry Data current (i.e., monthly updates), VALIDCARE may terminate this Agreement pursuant to Section 6.2 of this Exhibit, and Supplier may lose all access to the Platform.

5.4.3.        Product Data.  Supplier grants to VALIDCARE, for the term of the Agreement, a non-exclusive, royalty-free, right and license to sublicense Supplier’s Product Data in the Territory.  As between Supplier and VALIDCARE, Supplier will own all rights to data with respect to any information it supplies to VALIDCARE for display, including, without limitation, Product Data, and URLs or other identifiers used on Supplier’s web page accessed through or linked to the Platform.  Supplier will be solely responsible for: (i) creating, maintaining and updating all Product Data; (ii) the content, ongoing completeness and accuracy of such Product Data or of information contained on Supplier’s Platform-accessed web-site; (iii) complying with all Requirements of Law; and (iv) maintaining, updating and ensuring the security of Supplier’s Platform-accessed website.  If Supplier fails to provide Product Data which meets these requirements or fails to keep Product Data current (i.e., monthly updates), VALIDCARE may terminate this Agreement pursuant to Section 6.2 of this Exhibit, and Supplier may lose all access to the Platform.

5.4.4.        Aggregated Data.  Customers grant VALIDCARE a worldwide, perpetual, royalty-free license to use Customer Data for the preparation of Aggregated Data, which may be released or sold to Suppliers. 

5.5.  Web Page Link License VALIDCARE grants to Supplier for the Term of this Agreement a non-exclusive, worldwide, royalty-free license to use VALIDCARE’s Marks, URLs or other Platform identifiers (i) on Supplier’s web page and to link such web page to VALIDCARE’s home page; (ii) in Supplier’s Product and marketing materials to identify the Platform as a purchasing mechanism for Supplier’s Products; and (iii) to identify Supplier as a Supplier of the Platform.

5.6.  Reserved Rights. Except as provided in Section 11.2.1 of this Exhibit, nothing in this Agreement grants Supplier any right to use VALIDCARE’s Marks in any Product Data, sales promotion, or press release without VALIDCARE’s prior written approval.  Except in furtherance of the purposes set forth in Section 2.1 of this Exhibit, access to the Platform does not constitute a right to copy or use any of VALIDCARE Intellectual Property or the Intellectual Property of any other Supplier of the Platform.

5.7.  Confidentiality. 

5.7.1.        Confidential Information.  Certain information furnished or disclosed by each party to this Agreement, including, without limitation, Product Data, Customer Data and non-public information about each party’s business strategies and future product or Platform offerings may contain or reflect the confidential information of such party.  Confidential information of VALIDCARE is referred to hereinafter as “VALIDCARE Confidential Information.”  Except as provided below in this Section 5.7.1, VALIDCARE Confidential Information includes, without limitation, all VALIDCARE Intellectual Property, Information about or of other Platform Suppliers and information accessed through use of or concerning the Platform.  Confidential information of Supplier is referred to hereinafter as “Supplier Confidential Information.”  Supplier Confidential Information includes, without limitation, all Customer Registry Data expressly provided to VALIDCARE by Supplier.  VALIDCARE Confidential Information and Supplier Confidential Information are collectively referred to hereinafter as “Confidential Information.”  Confidential Information of the disclosing party also includes information that a reasonable person would generally understand and expect to be confidential or proprietary, as well as information that the disclosing party identifies at the time of disclosure as confidential.  Confidential Information does not include information that the receiving party demonstrates:

(a)    was published or otherwise became available to the general public without breach of this Agreement;

(b)    was furnished by a third party without a breach of such third party’s obligations to the disclosing party;

(c)    was in a party’s possession prior to the disclosure by the other party; and

(d)    was developed independently by an employee or agent who was not aware of Confidential Information furnished to it pursuant to this Agreement.

              Notwithstanding anything to the contrary set forth herein, any party to this Agreement (and each employee, representative, or other agent of such party) may disclose to any and all persons, without limitation of any kind, the tax treatment and tax structure of the relationship contemplated by this Agreement and all materials of any kind (including opinions or other tax analyses) that are provided to it relating to such tax treatment and tax structure.  This authorization of tax disclosure is retroactively effective to the commencement of the first discussions between the parties regarding the relationship contemplated herein.  The preceding two sentences will be interpreted to comply with the requirements of Treasury Regulation 1.6011-4(b)(3)(iii).

5.7.2.        Obligations.  Each party agrees to protect the confidentiality of the other’s Confidential Information in the same manner that it protects the confidentiality of its own proprietary and confidential information of like kind, but in no event with less than due care and attention.  Neither party will reproduce or use any Confidential Information of the other party, except pursuant to the limited license set forth in this Exhibit and for the purpose of conducting authorized communications on the Platform.  Neither party will disclose to any other person the other party’s Confidential Information without the prior written consent of the other party.  Each party will give prompt notice to the other of any unauthorized disclosure of the other party’s Confidential Information of which it becomes aware. 

5.7.3.        Legal Process.  If either party receives a subpoena or other validly issued administrative or judicial process requesting the Confidential Information of the other party, the party receiving the subpoena or other process will provide prompt notice to the other party of such receipt and the substance of such subpoena or process if reasonably practical and permitted by law.  In addition, to the extent permitted by applicable law, the receiving party will cooperate with the other party in any attempt to contest or limit such required disclosure, at such other party’s sole expense.  The receiving party will thereafter be entitled to comply with such subpoena or process to the extent reasonably required by law.  Notice will not be required prior to disclosure of Confidential Information to tax authorities to the extent reasonably required in connection with tax audits of VALIDCARE or Supplier. 

5.7.4.        Return of Confidential Information.  Upon termination or expiration of this Agreement, each party will promptly return to the other party and/or destroy all copies of the other party’s Confidential Information in its possession, custody or control, except that VALIDCARE may retain Product Data solely for archive purposes and Customer Data for archive purposes and for purposes of its joint owner.  If a party becomes aware of the unauthorized disclosure of the other party’s Confidential Information, it will give prompt notice to the other party of such disclosure. 

 

ARTICLE 6
TERM AND TERMINATION

6.1.  Term.  Unless sooner terminated as provided below, this Agreement will commence on the Effective Date and continue in effect until the longer of the thirty (36) six months or the Termination of any Scope of Work hereunder. Thereafter, this Agreement will automatically renew for additional one-year terms, unless either party notifies the other in writing of its intent to terminate this Agreement, at least sixty (60) days prior to the end of the then current term.   

6.2.  Termination By VALIDCARE.  VALIDCARE may terminate this Agreement upon thirty (30) days’ prior written notice and failure by Supplier to cure the complained of activity within such notice period, if: (i) Supplier breaches any material term of this Agreement; (ii) Supplier fails to pay any Fees when due; (iii) Supplier’s Product Data does not meet the standards of VALIDCARE, is inaccurate, or is not regularly updated by Supplier; (iv) VALIDCARE receives multiple, significant complaints which VALIDCARE reasonably believes to be well-founded from Platform Suppliers, including Customers of Supplier’s Products, concerning Supplier’s business practices or the safety of its Products and Supplier fails to take appropriate corrective action; or (v) Supplier is involved in any activity likely to undermine the reputation of VALIDCARE or in any illegal activity.  VALIDCARE may terminate this Agreement immediately if VALIDCARE, in the exercise of its reasonable discretion, determines that failure to take such action is likely to cause irreparable harm as a result of (iv) or (v).

6.3.  Termination By Supplier.  Supplier may terminate this Agreement (a) upon thirty (30) days’ prior written notice and failure by VALIDCARE to cure the complained of activity within such notice period, if VALIDCARE breaches any material term of this Agreement or (b) for convenience upon sixty (60) days prior written notice to VALIDCARE of a contract year.

6.4.  Consequences of Termination. 

6.4.1.        For VALIDCARE.  Upon termination of this Agreement, VALIDCARE will (i) comply with Section 5.7.4 of this Exhibit; (ii) terminate any hyperlinks to Supplier’s Product Data and website; (iii) de-activate Supplier’s Identifications; and (iv) if due to breach by VALIDCARE, will refund an allocable portion of Fees paid for any period after the termination. 

6.4.2.        For the Supplier.  Upon termination of this Agreement, Supplier will: (i) cease all use of the Platform (ii) pay all outstanding Fees; (iii) comply with Section 5.7.4 of this Exhibit; and (iv) honor all outstanding contracts with other Platform Suppliers.

6.4.3.        All rights and obligations with regard to information disclosed or matters occurring or arising before the effective date of termination will survive the termination or expiration of this Agreement, including without limitation, the rights and obligations set forth in ARTICLE 5, Section 6.4, ARTICLE 8, ARTICLE 9, and ARTICLE 10.

 

ARTICLE 7
DISCLAIMER

              OTHER THAN AS EXPRESSLY SET FORTH IN THIS AGREEMENT, INCLUDING MY NOT LIMITED TO THE SLA IN EXHIBIT 4, VALIDCARE MAKES NO REPRESENTATIONS, WARRANTIES OR COVENANTS TO ANY PERSON OR ENTITY WITH RESPECT TO THE SERVICES, THE PLATFORM OR ANY PRODUCTS SOLD THROUGH THE PLATFORM.  OTHER THAN AS EXPRESSLY SET FORTH ABOVE, VALIDCARE PROVIDES ALL SERVICES PERFORMED HEREUNDER “AS IS.”  VALIDCARE HEREBY DISCLAIMS ALL IMPLIED WARRANTIES, INCLUDING, WITHOUT LIMITATION, WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, ACCURACY OF DATA, NONINFRINGEMENT AND IMPLIED WARRANTIES ARISING FROM COURSE OF DEALING OR COURSE OF PERFORMANCE WITH REGARD TO THE PLATFORM, THE PLATFORM SOFTWARE AND ITS USER INTERFACE.  VALIDCARE DOES NOT WARRANT THAT IT WILL BE ABLE TO CORRECT ALL REPORTED DEFECTS IN THE PLATFORM OR THAT USE OF THE PLATFORM, ACCESS TO PRODUCT DATA OR LINKS TO OTHER SUPPLIER MATERIALS WILL BE UNINTERRUPTED OR ERROR-FREE.  VALIDCARE PROVIDES NO WARRANTIES WITH RESPECT TO THE FUNCTIONALITY OF THE SOFTWARE AND ITS USER INTERFACE.  VALIDCARE MAKES NO WARRANTY REGARDING FEATURES, SOFTWARE OR SERVICES PROVIDED BY THIRD PARTIES.

 

ARTICLE 8
LIMITATION OF LIABILITY

              EXCEPT FOR EACH PARTY’S INDEMNIFICATION OBLIGATIONS UNDER SECTIONS 9.1 AND 9.2 OF THIS EXHIBIT, EACH PARTY’S AGGREGATE LIABILITY FOR ALL CLAIMS OF ANY KIND (INCLUDING DEATH OR BODILY INJURY), WHETHER BASED ON CONTRACT, INDEMNITY, WARRANTY, TORT (INCLUDING NEGLIGENCE), STRICT LIABILITY OR OTHERWISE, FOR ALL LOSSES OR DAMAGES ARISING OUT OF, CONNECTED WITH, OR RESULTING FROM THIS AGREEMENT OR FROM THE PERFORMANCE OR BREACH THEREOF, OR FROM ANY SERVICES COVERED BY OR FURNISHED UNDER THIS AGREEMENT, WILL IN NO CASE EXCEED THE GREATER OF (1) THE AMOUNT OF FEES ACTUALLY PAID BY SUPPLIER TO VALIDCARE HEREUNDER OR (2) $2,000,000.  EXCEPT FOR EACH PARTY’S INDEMNIFICATION OBLIGATIONS UNDER SECTIONS 9.1 AND 9.2 OF THIS EXHIBIT, NEITHER PARTY WILL BE LIABLE FOR ANY LOSS OF BUSINESS, USE OR DATA, INTERRUPTION OF BUSINESS, LOST PROFITS OR GOODWILL, OR OTHER INDIRECT, SPECIAL, INCIDENTAL, EXEMPLARY OR CONSEQUENTIAL DAMAGES OF ANY KIND, EVEN IF SUCH PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH LOSS, AND NOTWITHSTANDING ANY FAILURE OF ESSENTIAL PURPOSE OR OF ANY LIMITED REMEDY.  THIS EXCLUSION INCLUDES ANY LIABILITY THAT MAY ARISE OUT OF THIRD PARTY CLAIMS AGAINST SUPPLIER OR VALIDCARE.  NEITHER PARTY WILL APPLY FOR, SEEK OR OTHERWISE REQUEST FROM ANY COURT, RELIEF OR REMEDY IN THE FORM OF EXEMPLARY OR PUNITIVE DAMAGES.

 

ARTICLE 9
INDEMNITY

9.1.  Indemnity by Platform.  VALIDCARE will defend, indemnify and hold harmless Supplier, its officers, directors, agents, assigns and successors-in-interest (collectively the “Supplier Indemnitees”) from and against any claims, demands, suits, causes of action, legal or administrative proceedings and pay all damages, costs and expenses, including, without limitation, reasonable attorneys’ fees and expenses, paid, incurred or suffered by any of the Supplier Indemnitees directly or indirectly attributable to any third party claims (i) that any VALIDCARE Intellectual Property infringes, misappropriates or violates such third party’s rights under any trademark, copyright, trade secret or any patent issued as of the Effective Date unless such claim is caused by misuse or modification by Supplier (except as authorized by VALIDCARE or by Supplier’s use of such VALIDCARE Intellectual Property in combination with any product or information not owned by or developed by VALIDCARE, (ii) failure by VALIDCARE to comply with Requirements of Law, or (iii) resulting from VALIDCARE’s gross negligence or willful misconduct.  To the fullest extent permitted by law, the foregoing indemnification will apply regardless of the fault, active or passive negligence (other than gross negligence or willful misconduct) or breach of warranty or contract by any of the Supplier Indemnitees.

9.2.  Indemnity by Supplier.  Supplier will defend, indemnify and hold harmless VALIDCARE, its officers, directors, agents, assigns and successors-in-interest (collectively the “VALIDCARE Indemnitees”) from and against all claims, demands, suits, causes of action, legal or administrative proceedings and pay all damages, costs and expenses, including, without limitation, reasonable attorneys’ fees and expenses, paid, incurred or suffered by any of the VALIDCARE Indemnitees, directly or indirectly attributable to any third party claims related to:  (i) the purchase, sale or performance of any Product purchased by or from Supplier through the Platform; (ii) intellectual property issues regarding Product Data supplied by Supplier, or posted by Supplier on its web-site linked to the Platform or Products marketed, offered or sold by Supplier through the Platform; (iii) information posted, supplied or used in connection with VALIDCARE or the Platform by Supplier; (iv) VALIDCARE’s acts or omissions in accordance with Supplier’s instructions with respect to the delivery of Customer Data; (v) the failure by Supplier to comply with Requirements of Law; (vi) any errors in any data supplied to VALIDCARE by Supplier; or (vii) Supplier’s gross negligence or willful misconduct.  To the fullest extent permitted by law, the foregoing indemnification will apply regardless of the fault, active or passive negligence (other than gross negligence or willful misconduct), or breach of warranty or contract by any of the VALIDCARE Indemnitees.

9.3.  Indemnification Procedures.  Promptly after receipt by an indemnified party of a notice of any third party claim or the commencement of any action, such indemnified party must (a) notify the indemnifying party in writing of any such claim; (b) provide the indemnifying party with reasonable assistance to settle or defend such claim at the indemnifying party’s own expense; and (c) grant to the indemnifying party the right to control the defense and/or settlement of such claim, at the indemnifying party’s own expense; provided, however, that (i) the failure to so notify, provide assistance or grant authority and control will only relieve the indemnifying party of its obligation to the indemnified party to the extent that the indemnifying party is prejudiced thereby; (ii) the indemnifying party will not, without the indemnified party’s consent (such consent not to be unreasonably withheld or delayed), agree to any settlement which: (x) makes any admission on behalf of the indemnified party; or (y) consents to an injunction against the indemnified party (except an injunction relating solely to the indemnified party’s continued use of any infringing intellectual property); and (iii) the indemnified party will have the right, at its expense, to participate in any legal proceeding to contest and defend a claim and to be represented by legal counsel of its choosing, but will have no right to settle a claim without the indemnifying party’s written consent, such consent not to be unreasonably withheld or delayed, and (iv) in the event the indemnifying party elects not to assume the control granted pursuant to clause (c) above, the indemnified party will have the right, notwithstanding anything in the preceding clause (iii) to the contrary, to control the defense and/or settlement of such claim, at the indemnifying party’s expense.

 

ARTICLE 10
GENERAL

10.1.         Independent Contractors; Non-Exclusive.  Each party to this Agreement is an independent contractor with respect to the other, and neither will have any authority to bind or commit the other.  Nothing in this Agreement will create a joint venture, partnership, or agency relationship between the parties.  This Agreement is not intended to be an exclusive arrangement and nothing contained herein will prevent Supplier from communicating with its Customers through any other electronic or other medium or channel. 

10.2.         Integration and Waiver.  This Agreement and any Exhibits attached hereto constitute the entire agreement between the parties relating to this subject matter.  All previous and collateral agreements, representations, warranties, promises, and conditions relating to the subject matter of this Agreement are superseded by this Agreement.  Any understanding, promise, representation, warranty, or condition not incorporated into this Agreement will not be binding on either party.  Waiver by a party of any default by the other will not be deemed a waiver of any other default irrespective of whether such default is similar. 

10.3.         Severability.  The invalidity or unenforceability of any term or provision herein will in no way affect the validity or enforceability of any other term or provision.

10.4.         Disputes. 

10.4.1.     If any dispute arises between the parties, either party may provide the other party with written notice of such dispute that reasonably, accurately and completely explains the dispute, and which requests that one senior executive from each party meet to discuss and attempt to settle the dispute within fifteen (15) business days after the other party receives such notice.  The designated executives of each party will meet and attempt to settle the dispute in good faith within such fifteen (15) day time period.  If the dispute is not settled to the mutual satisfaction of both parties with such fifteen (15) day time period, then they will have recourse to settle the dispute pursuant to Section 10.4.2 of this Exhibit.

10.4.2.     Upon the expiration of the fifteen-day period contemplated by Section 10.4.1 of this Exhibit, all disputes will be subject to arbitration pursuant to the rules of, and before three (3) arbitrators selected by, the Center for Public Resources Institute for Dispute Resolution.  Arbitrations will take place in a location selected by the party who received the initial written notice of dispute.  The cost of any arbitration is to be shared equally by the disputing parties.  Arbitration will be the only method, apart from good faith negotiations and requests for injunctive or other preliminary relief in a court of law, by which the parties resolve disputes.

10.5.         Governing Law; Jurisdiction.  This Agreement will be governed by and construed in accordance with the laws of the State of Colorado as though all acts or omissions related hereto occurred in such state.  All court actions arising out of or relating to this Agreement will be brought exclusively in a state or federal court located in Denver County, Colorado.  Supplier hereby consents to the jurisdiction of such courts.

10.6.         Force Majeure.  Except for obligations to make payment, neither party will be liable to the other for any delay in performance or inability to perform due to Force Majeure.  In the event of VALIDCARE’s inability to perform for more than five days as a result of Force Majeure, no Fees will be owed by Supplier to the extent that Supplier is affected by the inability to perform during such period.  “Force Majeure” means any acts or omissions of any civil or military authority, acts of God, acts or omissions of the other party hereto, terrorism, fires, strikes or other labor disturbances, major equipment failures, fluctuations or non-availability of electrical power, heat, light, air conditioning or telecommunications equipment that cannot reasonably be foreseen or prevented, or any other act, omission or occurrence beyond either party’s reasonable control, irrespective of whether similar to the foregoing enumerated acts, omissions or occurrences.  If either party’s performance is delayed by Force Majeure, the time for performance will be reasonably extended.

10.7.         Assignment and Sublicense.  Supplier will not assign, delegate, sublicense, transfer or subcontract the whole or any part of this Agreement or its rights hereunder without VALIDCARE’s prior written consent, provided however, that the merger, consolidation, reorganization or change in control or the acquisition of substantially all of the business and assets of Supplier will not be deemed an assignment and will not require the consent of VALIDCARE provided that Supplier’s successor-in-interest undertakes in writing to be bound by the terms of this Agreement.  Supplier may extend this Agreement to additional Affiliates by notice to VALIDCARE.  VALIDCARE may assign, delegate, sublicense, transfer, or subcontract any of its rights or obligations hereunder to any of its wholly-owned subsidiaries.  Subject to the foregoing, this Agreement will be binding upon, and will inure to the benefit of, the parties hereto and their respective permitted successors and assigns.

10.8.         Notices.  All notices, requests and other communications required or permitted to be given under this Agreement, except those specifically permitted to be given by e-mail, must be in writing, and must be mailed by registered or certified mail, postage prepaid and return receipt requested, or delivered by express mail, private courier or facsimile to the party to whom such notice is required or permitted to be given.  Any such notice will be considered to have been given when received, or if mailed, five business days after it was mailed, as evidenced by the postmark.  The mailing address or electronic mail address for notice to either party will be the address shown on the signature page of this Agreement.  Either party may change its mailing address or electronic mail address by notice as provided by this Section 10.8.

10.9.         Third-Party Rights.  Except as expressly provided in this Agreement, this Agreement will not be construed to confer any right or benefit on any party other than the parties hereto and their permitted successors and assigns.

 

ARTICLE 11
SPECIAL PROVISIONS FOR SUPPLIERS

11.1.          Fees and Payments.  

11.1.1.      Fees.  As consideration for Supplier’s access to the Platform and use of the services provided by VALIDCARE, Supplier will pay to VALIDCARE a User Fee (the “Fee”) in accordance with the schedule set forth in Platform Order Form.  In addition, Supplier will pay all taxes levied in connection with this Agreement other than taxes based on VALIDCARE’s net income.

11.1.2      Invoicing and Payment.  VALIDCARE will invoice Supplier for Fees and Supplier will make payment on the terms set forth in Exhibit 2.  On all sums past due, Supplier agrees to pay interest at the lesser of one and one‑half percent (1.5%) per month or the then-highest interest rate allowable under applicable law, plus collection costs (including, without limitation, reasonable attorneys’ fees), until paid in full.  VALIDCARE reserves the right to suspend further display of Supplier’s Product Data, suspend Supplier’s access to the Platform or cancel this Agreement on thirty (30) days written notice to Supplier if Supplier fails to pay any amount when due.

 

ARTICLE 12 

SERVICE LEVELS

This section details VALIDCARE Service Level Agreement (“SLA”) between VALIDCARE, LLC (“VALIDCARE”) and Supplier governing the availability of the VALIDCARE Platform as described under section 2.1 of User Agreement.

12.1.         Service Commitment VALIDCARE will use best efforts to make the VALIDCARE Platform available with an annual Uptime Percentage of at least 99% during any calendar month (the “Service Commitment”).  Such efforts include, but are not limited to, monitoring network, server and application availability through its monitoring servers or services, and software twenty-four (24) hours a day, seven (7) days a week and three hundred and sixty-five (365) days a year through the use of automated monitoring systems and on-call personnel. Subject to the VALIDCARE SLA Exclusions, if VALIDCARE does not meet the Service Commitment, Supplier will be eligible to receive a Service Credit.  An annual Uptime Percentage of 99% means that VALIDCARE guarantees Supplier will experience no more than 5,256 min/year of Unavailability.

12.2.         Definitions

                 “Chronic Failure” shall mean when the Service Commitment is not met for two or more occurrences of unplanned downtime during any thirty (30) calendar day period for ten (10) or more hours of cumulative downtime.

“Maintenance” means scheduled Unavailability of the VALIDCARE Platform, as announced by VALIDCARE prior to the VALIDCARE Platform becoming Unavailable as reasonably necessary for application maintenance, updates, or repair.  VALIDCARE will give Supplier at least 24 hours’ advance notice of Maintenance, unless a shorter notice period is required under the circumstances. The notice will specify the date and start time of the Maintenance and the expected period during which the VALIDCARE Platform will be Unavailable. VALIDCARE shall use commercially reasonable efforts to minimize the effects of such Maintenance on Supplier’s regular business operations, including scheduling all Maintenance, whenever possible, outside of regular business hours.

“Monthly Uptime Percentage” is calculated by subtracting from 100% the percentage of minutes during the month in which the VALIDCARE Licensed Products were Unavailable. Monthly Uptime Percentage measurements exclude downtime resulting directly or indirectly from any VALIDCARE SLA Exclusion.

“Service Credit” means a credit denominated in US dollars, calculated as set forth below, that VALIDCARE may credit back to an eligible account.

“Unavailable” and “Unavailability” mean when the VALIDCARE Platform is not operational in accordance with the User Agreement and the applicable Documentation, as confirmed by its monitoring.

12.3.         Service Commitments and Service Credits Service Credits are calculated as a percentage of the total annual VALIDCARE Platform Subscription (as a Licensed Product) paid by Supplier, divided by 12. Service Credits are owed by VALIDCARE to Supplier for Unavailability for any Monthly Uptime Percentage less than 99%.  Supplier will be eligible for Service Credit(s) on a pro-rata basis for the duration of the outage. For example, if in a given calendar month the Monthly Uptime Percentage was calculated as 98.5%, the Service Credit would be calculated as 1% multiplied by the total Annual Platform Subscription paid by Supplier, divided by 12.

12.4.         Credit Request and Payment Procedures To receive a Service Credit, a paying Supplier must submit a claim of a reported outage by emailing support@validcare.com and including the dates and times of each event. For the unavailability incident that Supplier is claiming to be eligible, the outage must be verified by VALIDCARE.  Once verified, VALIDCARE will confirm existence of the outage and will provide detail as to duration to Supplier. 

VALIDCARE will apply any Service Credits against future payments otherwise due from Supplier for the VALIDCARE Platform, unless those Service Credits accrue in a final year of an agreement between the parties.  In such case, VALIDCARE will refund the eligible amount within sixty (60) calendar days after final termination of the Agreement.

12.5.         VALIDCARE SLA Exclusions The Service Commitment does not apply to any unavailability, suspension or termination of the VALIDCARE Platform, or any other VALIDCARE performance issues (i) caused by factors outside of VALIDCARE’s reasonable control, including any force majeure event, Internet access, or problems beyond the demarcation point of the VALIDCARE network; (ii) That result from any actions or inactions of Supplier or any third party; (iii) That result from the equipment, software or other technology of Supplier or any third party (other than third party equipment within VALIDCARE’s direct control); (iv)  That result from any Maintenance.

If availability is impacted by factors other than those used in the Annual Uptime Percentage calculation, then VALIDCARE may issue a Service Credit considering such factors at its discretion.

 

The parties agree that failure to meet the Service Commitment set forth above that amounts to a “Chronic Failure” shall give Supplier a right to terminate the Supplier Agreement or the applicable SOW upon thirty (30) days written notice without the ability of VALIDCARE to cure.