CONSULTING AGREEMENT
by and between
CRESTLINE PACKAGING SOLUTIONS LLC
and
DR. RAYMOND ALCOTT
Dated as of August 15, 2025
CONSULTING AGREEMENT
This CONSULTING AGREEMENT (this "Agreement") is made and entered into as of August 15, 2025 (the "Effective Date"), by and between:
CRESTLINE PACKAGING SOLUTIONS LLC, a Delaware limited liability company with its principal office located at 8400 Scioto Darby Road, Suite 300, Columbus, OH 43228 (the "Company");
and
DR. RAYMOND ALCOTT, an individual residing at 14 Tobey Trail, Pittsford, NY 14534 (the "Consultant").
The Company and the Consultant are each sometimes referred to herein individually as a "Party" and collectively as the "Parties."
RECITALS
WHEREAS, the Company, through its wholly owned subsidiary or as assignee under that certain Asset Purchase Agreement, dated as of June 16, 2025 (the "APA"), by and among the Company and Lakewood Regional Health Partners, LLC, a New York limited liability company ("Lakewood"), and Dr. Raymond Alcott and Dr. Nadia Petrosian, as the members of Lakewood (the "Members"), has acquired substantially all of the assets of Lakewood (the "Acquisition");
WHEREAS, the Consultant served as Co-Managing Member of Lakewood, holding sixty percent (60%) of the issued and outstanding membership interests in Lakewood, and possesses extensive knowledge of Lakewood's clinical operations across its eleven (11) clinic locations in the States of New York and Pennsylvania, its provider networks, payor relationships, patient populations, referral relationships, and quality programs, which knowledge is critical to the successful integration of the Acquired Business;
WHEREAS, as a material condition and inducement to the Company's willingness to consummate the Acquisition and to pay the Purchase Price (as defined in the APA), and as contemplated by Section 7.14 of the APA, the Consultant has agreed to provide consulting services to the Company for a transitional period following the Closing (as defined in the APA) on the terms and conditions set forth herein; and
WHEREAS, capitalized terms used but not otherwise defined herein shall have the meanings ascribed to such terms in the APA.
NOW, THEREFORE, in consideration of the mutual covenants and agreements set forth herein, the Purchase Price paid in connection with the Acquisition, the consummation of the transactions contemplated by the APA, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:
ARTICLE 1 — DEFINITIONS
As used in this Agreement, the following terms shall have the meanings set forth below. Capitalized terms used but not defined in this Article 1 or elsewhere in this Agreement shall have the meanings ascribed to such terms in the APA.
"Acquired Business" means the business formerly conducted by Lakewood and acquired by the Company pursuant to the APA, including the clinical operations conducted at the eleven (11) clinic locations identified by CMS Certification Numbers 33-7021, 33-7022, 33-7023, 33-7024, 33-7025, 33-7026, 33-7027, 33-7028, 39-6011, 39-6012, and 39-6013.
"Affiliate" means, with respect to any Person, any other Person that directly or indirectly controls, is controlled by, or is under common control with such Person. For purposes of this definition, "control" (including the terms "controlled by" and "under common control with") means the possession, direct or indirect, of the power to direct or cause the direction of the management and policies of such Person, whether through ownership of voting securities, by contract, or otherwise. Without limitation, the term "Affiliate" as applied to the Company shall include CPS Holdings, Inc. and Pinnacle River Capital Partners, LP and their respective portfolio companies and controlled entities.
"APA" has the meaning set forth in the Recitals.
"Board" means the board of managers (or equivalent governing body) of the Company.
"Business Day" means any day other than a Saturday, a Sunday, or a day on which banking institutions in the State of New York or the State of Ohio are authorized or required by law to be closed.
"Closing Date" has the meaning set forth in the APA.
"Competing Business" means any Person or business enterprise that provides, directly or indirectly, healthcare services, clinical consulting services, healthcare management services, or ancillary healthcare services that are the same as or substantially similar to those provided by the Acquired Business as of the Closing Date, including without limitation primary care, specialty outpatient, and diagnostic services.
"Confidential Information" has the meaning set forth in Section 6.1.
"Deliverables" means all reports, analyses, memoranda, recommendations, protocols, procedures, transition playbooks, quality dashboards, and any other tangible or intangible work product to be prepared or delivered by the Consultant in connection with the performance of the Services, as further described in Exhibit A.
"Effective Date" has the meaning set forth in the preamble to this Agreement.
"Engagement Period" means the period commencing on the Effective Date and ending on the earlier of (a) August 15, 2027, or (b) the date on which this Agreement is terminated in accordance with Article 9.
"HIPAA" means the Health Insurance Portability and Accountability Act of 1996, as amended by the Health Information Technology for Economic and Clinical Health Act ("HITECH"), and the implementing regulations promulgated thereunder at 45 C.F.R. Parts 160 and 164, each as amended from time to time.
"Intellectual Property" means all patents, patent applications, trademarks, service marks, trade names, copyrights, trade secrets, know-how, inventions, discoveries, improvements, processes, techniques, methodologies, software, databases, and all other intellectual property rights of any kind, whether registered or unregistered.
"Key Payors" means the commercial and governmental payors that, individually or in the aggregate, represent a material portion of the revenue of the Acquired Business, including without limitation Meridian Shield Health Plans, Inc., the Medicare program (administered through Keystone MAC Services, LLC as the Medicare Administrative Contractor), and the Medicaid programs of the States of New York and Pennsylvania.
"Person" means any individual, corporation, limited liability company, partnership, joint venture, association, trust, unincorporated organization, governmental authority, or other entity.
"PHI" means Protected Health Information as defined in 45 C.F.R. § 160.103.
"Restricted Area" means the geographic area within a seventy-five (75) mile radius of any clinic location comprising the Acquired Business as of the Closing Date, as identified by the CMS Certification Numbers set forth in the definition of "Acquired Business."
"Restricted Period" means the period commencing on the Closing Date and ending on the date that is three (3) years following the Closing Date (i.e., August 15, 2028).
"Services" means the consulting services to be performed by the Consultant during the Engagement Period as described in Article 3 and Exhibit A, and such additional services as may be mutually agreed upon in writing by the Parties.
"Term" means the Engagement Period.
"Territory" means the States of New York and Pennsylvania and such other jurisdictions in which the Acquired Business conducts operations or has active patient or payor relationships as of the Effective Date.
"Work Product" has the meaning set forth in Section 7.1.
ARTICLE 2 — ENGAGEMENT; INDEPENDENT CONTRACTOR STATUS
Section 2.1 — Engagement
The Company hereby engages the Consultant, and the Consultant hereby accepts such engagement, to provide the Services described in Article 3 and Exhibit A during the Engagement Period, subject to the terms and conditions of this Agreement. The engagement of the Consultant hereunder is non-exclusive, and the Consultant may pursue other professional activities, business interests, and consulting arrangements during the Term; provided, however, that any such activities shall not (a) interfere with the Consultant's performance of the Services or compliance with the time-commitment requirements set forth in Section 3.5, (b) violate the non-competition, non-solicitation, or confidentiality restrictions set forth in Article 6, Article 8, or the APA, or (c) create an actual or apparent conflict of interest with respect to the Consultant's obligations under this Agreement.
Section 2.2 — Independent Contractor Relationship
The Consultant's relationship with the Company under this Agreement is that of an independent contractor, and nothing contained herein shall be construed to create an employer-employee relationship, agency, partnership, joint venture, or any other relationship between the Parties other than that of independent contracting parties. The Consultant shall have no authority to bind the Company or any of its Affiliates or to make any representations, commitments, or agreements on behalf of the Company or any of its Affiliates, and the Consultant shall not hold himself out as having any such authority. No employment relationship, express or implied, is created or intended by this Agreement. The Consultant acknowledges and agrees that, as an independent contractor, the Consultant is not entitled to participate in, or receive any benefits under, any employee benefit plan, program, or arrangement of the Company or any of its Affiliates, including without limitation any group health, dental, vision, life, or disability insurance plan; any paid time off, vacation, or sick leave policy; any workers' compensation or unemployment insurance program; or any retirement or savings plan, including the retirement plan administered by Grandview Retirement Services, Inc. (the "Grandview 401(k) Plan") or any other Company-sponsored defined contribution or defined benefit plan.
Section 2.3 — Tax Matters
The Consultant shall be solely responsible for, and shall timely pay, all federal, state, and local income taxes, self-employment taxes, estimated taxes, and any other tax obligations arising from compensation received under this Agreement. The Company shall not withhold or pay on the Consultant's behalf any federal, state, or local income tax, Social Security tax, Medicare tax, Federal Unemployment Tax Act (FUTA) contributions, State Unemployment Tax Act (SUTA) contributions, or any other payroll-related tax or withholding. The Company shall report all payments made to the Consultant under this Agreement on IRS Form 1099-NEC, or such other form as may be required under applicable law, for each calendar year during which payments are made. The Consultant shall provide the Company with a fully completed and duly executed IRS Form W-9 (Request for Taxpayer Identification Number and Certification) upon execution of this Agreement and promptly following any change in the information set forth therein.
ARTICLE 3 — SCOPE OF SERVICES
Section 3.1 — Clinical Transition Support
During the Engagement Period, the Consultant shall assist the Company with the orderly transition of Lakewood's clinical operations to the Company's management and operational framework. Without limiting the generality of the foregoing, the Consultant shall:
(a) facilitate continuity of patient care across all eleven (11) clinic locations comprising the Acquired Business, including the eight (8) New York Article 28 facilities (CMS Certification Numbers 33-7021 through 33-7028) and the three (3) Pennsylvania outpatient facilities (CMS Certification Numbers 39-6011 through 39-6013), with particular attention to minimizing patient disruption and ensuring uninterrupted access to care during the post-Closing transition;
(b) advise on the integration of Lakewood's existing clinical protocols, clinical workflows, and standard operating procedures into the Company's healthcare division operational framework, including identification of best practices, gaps, and areas requiring harmonization or modification;
(c) support the credentialing and re-credentialing processes with the Medicare program (including coordination with Keystone MAC Services, LLC in its capacity as the Medicare Administrative Contractor), applicable state Medicaid programs, and commercial payors, including assisting with the preparation of provider enrollment applications, responding to payor inquiries, and ensuring continuity of provider participation in payor networks;
(d) assist with the transition of the Clearpath Health Systems, Inc. electronic health record ("EHR") platform (License Agreement No. CP-ENT-2022-0487) and related clinical data migration, including advising on data integrity, clinical documentation continuity, workflow customization, user training requirements, and interface configurations with ancillary systems;
(e) advise on the management of the pending inquiry by the Office of Inspector General of the United States Department of Health and Human Services ("OIG") at the Syracuse facility relating to potential upcoding of evaluation and management services under CPT code 99214 (estimated financial exposure of $350,000 to $900,000), including coordinating with the Company's legal counsel, supporting the preparation of responsive documentation, and advising on remedial compliance measures; and
(f) perform such other clinical transition support services as may be reasonably requested by the Company from time to time and that are consistent with the general scope of the Services described herein.
Section 3.2 — Provider Relationship Management
During the Engagement Period, the Consultant shall use commercially reasonable efforts to preserve and strengthen the Acquired Business's relationships with its clinical providers and referral sources. Without limiting the generality of the foregoing, the Consultant shall:
(a) maintain and strengthen relationships with Lakewood's thirty-eight (38) physicians and twenty-four (24) nurse practitioners and physician assistants during the transition period, including through regular outreach, in-person meetings at clinic locations, and participation in provider forums and town halls as reasonably requested by the Company;
(b) assist the Company with provider retention strategies, including identification of key providers at risk of departure, development of retention initiatives, and support for recruitment and onboarding of replacement or additional providers as the needs of the Acquired Business may require;
(c) serve as a liaison between the Acquired Business's clinical staff and the Company's management team, facilitating communication, addressing clinical staff concerns, and promoting alignment between the clinical workforce and the Company's operational objectives; and
(d) support the renegotiation and management of relationships with key referral sources, affiliated health systems, and other clinical partners that contribute to the patient volume and revenue of the Acquired Business.
Section 3.3 — Quality Assurance Advisory Services
During the Engagement Period, the Consultant shall provide advisory services to the Company regarding clinical quality, outcomes management, and regulatory compliance for the Acquired Business. Without limiting the generality of the foregoing, the Consultant shall:
(a) advise on clinical quality metrics, outcomes reporting, clinical benchmarking, and compliance with applicable accreditation standards (including any standards imposed by The Joint Commission, the National Committee for Quality Assurance, or other accrediting bodies) and regulatory requirements;
(b) participate in quality committee meetings, peer review processes, and clinical governance activities as reasonably requested by the Company, including attendance at meetings of the Acquired Business's medical executive committee and quality improvement committee;
(c) advise on compliance with the Health Insurance Portability and Accountability Act of 1996, as amended ("HIPAA"), the federal physician self-referral law (42 U.S.C. § 1395nn) (the "Stark Law"), the Anti-Kickback Statute (42 U.S.C. § 1320a-7b(b)), the False Claims Act (31 U.S.C. §§ 3729–3733), and applicable New York and Pennsylvania healthcare regulations, including the New York Public Health Law, the Pennsylvania Health Care Facilities Act, and related regulations; and
(d) support the Company's engagement with Marchand Healthcare Regulatory Advisors, LLC on regulatory filings, including the preparation and submission of change-of-ownership applications with the New York State Department of Health ("NY DOH") and the Pennsylvania Department of Health ("PA DOH"), and advise on any conditions or corrective action plans imposed in connection with such applications.
Section 3.4 — Additional Services
From time to time during the Engagement Period, the Company may request the Consultant to perform additional services that are reasonably related to the scope of the Services described in this Article 3 and Exhibit A. The Consultant shall use commercially reasonable efforts to accommodate such requests, subject to the time-commitment limitations set forth in Section 3.5. Any material expansion of the scope of the Services beyond that described in this Article 3 and Exhibit A shall be agreed upon in a written amendment or supplement to this Agreement executed by both Parties.
Section 3.5 — Time Commitment
The Consultant shall devote the following minimum time to the performance of the Services during the Engagement Period:
(a) First Twelve (12) Months (August 15, 2025 through August 15, 2026): A minimum of twenty (20) hours per week, on average, calculated on a monthly basis.
(b) Second Twelve (12) Months (August 16, 2026 through August 15, 2027): A minimum of ten (10) hours per week, on average, calculated on a monthly basis.
The scheduling of the Consultant's working hours shall be at the Consultant's reasonable discretion, consistent with the needs of the Acquired Business and the Company's reasonable requests. The Consultant shall maintain reasonable availability for on-site presence at the Rochester Main facility located at 450 East Ridge Road, Rochester, NY 14621, and at such other clinic locations as the Company may reasonably request from time to time. The Consultant acknowledges that the Services may require periodic travel to clinic locations outside the Rochester, New York metropolitan area, including the Syracuse, Buffalo, and Pennsylvania facilities.
Section 3.6 — Reporting
The Consultant shall report to Marcus Waverly, Chief Executive Officer of the Company, or such other officer of the Company as may be designated in writing by the Company from time to time (the "Company Contact"). The Consultant shall provide the Company Contact with monthly written status reports summarizing the status of transition milestones, open items, issues requiring management attention, and the Consultant's recommendations. Such monthly reports shall be submitted no later than the tenth (10th) Business Day of each calendar month with respect to the immediately preceding calendar month. In addition to such monthly reports, the Consultant shall be available for periodic meetings, conference calls, and other communications with the Company Contact and other members of the Company's management team as reasonably requested.
ARTICLE 4 — TERM
Section 4.1 — Engagement Period
The engagement of the Consultant under this Agreement shall commence on the Effective Date and shall continue for a period of two (2) years, expiring at 11:59 p.m. (Eastern Time) on August 15, 2027 (the "Term"), unless earlier terminated in accordance with Article 9 of this Agreement.
Section 4.2 — No Renewal
The Term shall not automatically renew upon its expiration. Any extension or renewal of the Term shall require a written amendment to this Agreement duly executed by both Parties.
ARTICLE 5 — COMPENSATION AND EXPENSES
Section 5.1 — Consulting Fee
In consideration for the Consultant's performance of the Services during the Term, the Company shall pay the Consultant an annual consulting fee of Four Hundred Fifty Thousand Dollars ($450,000) (the "Annual Fee"), payable in equal monthly installments of Thirty-Seven Thousand Five Hundred Dollars ($37,500) each. Each monthly installment shall be due and payable on the first (1st) Business Day of each calendar month during the Term. In the event the Term commences or terminates on a date other than the first day of a calendar month, the consulting fee for such partial month shall be prorated on a per diem basis (calculated by dividing the applicable monthly installment by the number of calendar days in such month and multiplying by the number of calendar days during which this Agreement was in effect during such month). All payments shall be made by wire transfer of immediately available funds to a bank account designated by the Consultant in writing.
Section 5.2 — Expenses
The Company shall reimburse the Consultant for reasonable, documented, and pre-approved out-of-pocket expenses actually incurred by the Consultant in connection with the performance of the Services, including travel expenses incurred in connection with travel to clinic locations outside of the Rochester, New York metropolitan area. The Consultant shall submit itemized expense reports on a monthly basis, accompanied by supporting receipts and documentation reasonably satisfactory to the Company. The Company shall reimburse approved expenses within thirty (30) days following submission of a complete expense report. The following travel policies shall apply unless otherwise approved in writing by the Company Contact:
(a) Airfare: Coach class for flights with a scheduled duration of less than four (4) hours; business class permitted for flights with a scheduled duration of four (4) hours or longer.
(b) Hotel Accommodations: Nightly room rates shall not exceed Two Hundred Fifty Dollars ($250) per night without the prior written approval of the Company Contact.
(c) Ground Transportation: Reasonable costs for rental cars, rideshare services, taxis, or mileage reimbursement at the then-current IRS standard mileage rate for business use.
(d) Meals and Incidentals: Reasonable meal expenses, not to exceed One Hundred Dollars ($100) per day, unless incurred in connection with business entertainment pre-approved by the Company Contact.
Section 5.3 — No Additional Compensation
Except as expressly set forth in this Article 5, the Consultant shall not be entitled to any bonus, equity interest, profit participation, incentive compensation, signing payment, retention payment, or other form of compensation from the Company or any of its Affiliates in connection with the performance of the Services. For the avoidance of doubt, nothing in this Section 5.3 shall affect the Consultant's rights to receive the Purchase Price or any Earnout Payments (as defined in the APA) to which the Consultant may be entitled under the APA.
Section 5.4 — Benefits
The Consultant acknowledges and agrees that, as an independent contractor, the Consultant is not eligible for participation in or receipt of benefits under any health insurance, dental insurance, vision insurance, life insurance, short-term or long-term disability, paid time off, sick leave, 401(k) retirement savings, pension, profit sharing, or any other employee benefit plan, program, or arrangement sponsored or maintained by the Company or any of its Affiliates, including the Grandview 401(k) Plan.
ARTICLE 6 — CONFIDENTIAL INFORMATION
Section 6.1 — Definition of Confidential Information
For purposes of this Agreement, "Confidential Information" means all non-public, confidential, or proprietary information of or relating to the Company, its Affiliates (including without limitation CPS Holdings, Inc. and Pinnacle River Capital Partners, LP and their respective portfolio companies), and the Acquired Business, whether disclosed to or obtained by the Consultant before or after the Effective Date, whether disclosed orally, in writing, electronically, or by any other means, and whether or not marked or designated as "confidential." Without limiting the generality of the foregoing, Confidential Information includes:
(a) all patient information, individually identifiable health information, and PHI, in any form, relating to patients treated at any of the eleven (11) clinic locations comprising the Acquired Business;
(b) clinical data, clinical protocols, outcomes data, quality metrics, peer review information, and credentialing information;
(c) financial information, including but not limited to the seventy-eight million four hundred thousand dollar ($78,400,000) trailing twelve-month ("TTM") net revenue figure, the sixteen million one hundred thousand dollar ($16,100,000) TTM Adjusted EBITDA figure, and all related financial data, projections, budgets, forecasts, and business plans;
(d) business plans, strategies, market analyses, competitive intelligence, growth initiatives, and acquisition or disposition plans;
(e) trade secrets, proprietary methodologies, processes, techniques, and know-how;
(f) the terms, conditions, reimbursement rates, and performance of payor contracts, including without limitation the arrangements with Meridian Shield Health Plans, Inc. and other managed care organizations and governmental payors;
(g) provider compensation arrangements, employment agreements, independent contractor agreements, and related terms;
(h) information obtained through or stored in the Clearpath Health Systems, Inc. EHR platform (License Agreement No. CP-ENT-2022-0487), including clinical data, operational data, and system configurations;
(i) information relating to the reference laboratory services arrangement with Redstone Diagnostics, Inc. (including pricing, volumes, and contractual terms) and the imaging equipment lease arrangements with Marlowe Asset Management Medical Equipment Finance, LLC (including Schedules VML-2023-1140, VML-2023-1141, and VML-2024-0219);
(j) information relating to employees, contractors, and providers of the Company and the Acquired Business, including compensation, performance, and personal information;
(k) information concerning the Company's and its Affiliates' investors, limited partners, portfolio companies, investment strategies, and financial condition; and
(l) any other information that a reasonable person would understand to be confidential or proprietary given the nature of the information and the circumstances of disclosure.
Section 6.2 — Non-Disclosure Obligation
The Consultant shall not, during the Term or at any time thereafter, directly or indirectly, use, disclose, publish, disseminate, or otherwise make available to any Person any Confidential Information, except (a) as necessary to perform the Services in accordance with this Agreement, (b) as expressly authorized in writing by the Company, or (c) as required by applicable law, regulation, or legal process in compliance with Section 6.4. The Consultant shall use at least the same degree of care to protect the Confidential Information as the Consultant uses to protect his own confidential information, but in no event less than a reasonable degree of care. The non-disclosure obligation set forth in this Section 6.2 shall survive the expiration or termination of this Agreement (i) in perpetuity with respect to Confidential Information that constitutes a trade secret under applicable law, and (ii) for a period of five (5) years following the expiration or termination of this Agreement with respect to all other Confidential Information.
Section 6.3 — Exceptions
The obligations of the Consultant under Section 6.2 shall not apply to information that:
(a) is or becomes generally available to the public other than as a result of a disclosure by the Consultant in violation of this Agreement;
(b) is independently developed by the Consultant without reference to, reliance upon, or use of any Confidential Information, as demonstrated by the Consultant's contemporaneous written records;
(c) is received by the Consultant from a third party that is not, to the Consultant's knowledge, under any obligation of confidentiality to the Company or its Affiliates with respect to such information; or
(d) was in the Consultant's lawful possession prior to the Effective Date; provided, however, that information received by the Consultant in his capacity as Co-Managing Member of Lakewood or in connection with the Acquisition shall be deemed Confidential Information and shall not be subject to this exception.
Section 6.4 — Compelled Disclosure
If the Consultant is compelled by applicable law, subpoena, civil investigative demand, court order, or other legal process to disclose any Confidential Information, the Consultant shall, to the extent legally permissible, provide the Company with prompt written notice of such requirement so that the Company may seek a protective order, confidential treatment, or other appropriate remedy. In the event that such protective order or other remedy is not obtained, or the Company waives compliance with this Section 6.4, the Consultant shall disclose only that portion of the Confidential Information that is legally required to be disclosed. The Consultant shall exercise commercially reasonable efforts to preserve the confidentiality of the Confidential Information so disclosed, including by cooperating with the Company to obtain an appropriate protective order or other reliable assurance that confidential treatment will be afforded to the Confidential Information. Nothing in this Agreement is intended to, or shall, prohibit or restrict the Consultant from making disclosures protected under applicable whistleblower statutes or other provisions of law, including pursuant to the Defend Trade Secrets Act of 2016 (18 U.S.C. § 1833(b)).
Section 6.5 — Return of Materials
Upon the expiration or termination of this Agreement, or at any time upon the Company's written request, the Consultant shall promptly return to the Company (or, at the Company's election, destroy) all documents, files, records, data, correspondence, notes, memoranda, electronic media, and all other materials (in any form or medium, including digital and electronic copies) that contain, reflect, or are based upon any Confidential Information. The Consultant shall provide the Company with a written certification of such return or destruction, signed by the Consultant, within ten (10) Business Days following the effective date of expiration or termination of this Agreement (or the date of such request, as applicable). Notwithstanding the foregoing, the Consultant may retain one (1) archival copy of Confidential Information solely for purposes of monitoring compliance with this Agreement and applicable legal obligations, provided that such archival copy shall remain subject to the confidentiality obligations set forth herein.
Section 6.6 — HIPAA Compliance
The Consultant acknowledges and agrees that, in connection with the performance of the Services, the Consultant may have access to, use, or disclose PHI that is subject to HIPAA, HITECH, and applicable state privacy laws, including the New York Information Security Breach and Notification Act (N.Y. Gen. Bus. Law § 899-aa) and the Pennsylvania Breach of Personal Information Notification Act (73 Pa. Stat. §§ 2301–2329). To the extent the Consultant accesses, receives, creates, maintains, uses, or discloses PHI in connection with the Services, the Consultant shall comply with the terms and conditions of the Business Associate Agreement attached hereto as Exhibit B and incorporated herein by reference. The Consultant shall implement and maintain appropriate administrative, physical, and technical safeguards to protect the confidentiality, integrity, and availability of all PHI to which the Consultant has access in connection with the Services, including PHI contained in the patient records maintained at all eleven (11) clinic locations comprising the Acquired Business.
ARTICLE 7 — WORK PRODUCT AND INTELLECTUAL PROPERTY
Section 7.1 — Work Product Ownership
All Deliverables, reports, analyses, memoranda, recommendations, protocols, procedures, transition playbooks, quality dashboards, presentations, and any and all other work product created, developed, conceived, or reduced to practice by the Consultant, whether alone or jointly with others, in connection with the performance of the Services (collectively, "Work Product") shall be the sole and exclusive property of the Company. To the fullest extent permitted by applicable law, all Work Product shall be considered "works made for hire" as that term is defined in Section 101 of the United States Copyright Act (17 U.S.C. § 101). To the extent that any Work Product does not qualify as a "work made for hire" under applicable law, the Consultant hereby irrevocably and unconditionally assigns, transfers, and conveys to the Company all of his right, title, and interest in and to such Work Product, including all intellectual Property rights therein, throughout the world, in all media now known or hereafter devised, for the full duration of such rights (including any extensions and renewals thereof). The Company shall have the right to use, reproduce, modify, distribute, display, perform, license, sublicense, and otherwise exploit the Work Product in any manner and for any purpose, without any further compensation to the Consultant.
Section 7.2 — Moral Rights Waiver
To the fullest extent permitted by applicable law, the Consultant hereby irrevocably waives, and agrees not to assert, any and all moral rights (including rights of attribution, integrity, disclosure, and withdrawal) that the Consultant may have in or with respect to the Work Product, whether arising under the Copyright Act, the Berne Convention, the Visual Artists Rights Act of 1990 (17 U.S.C. §§ 106A, 113(d)), or any other federal, state, or foreign law, treaty, or regulation.
Section 7.3 — Further Assurances
The Consultant shall, upon the Company's reasonable request, execute, acknowledge, and deliver such further instruments, documents, and assignments as the Company may reasonably require to perfect, evidence, register, or record the Company's ownership of the Work Product and the intellectual Property rights therein, including without limitation patent applications, copyright registrations, assignments, and declarations. The Consultant's obligations under this Section 7.3 shall survive the expiration or termination of this Agreement. If the Company is unable, after reasonable effort, to obtain the Consultant's signature on any document needed to apply for or prosecute any patent, copyright, or other right or protection relating to any Work Product, the Consultant hereby irrevocably designates and appoints the Company and its duly authorized officers and agents as the Consultant's agent and attorney-in-fact (which appointment is coupled with an interest) to act for and on the Consultant's behalf for the limited purpose of executing and filing any such application or document with the same legal force and effect as if executed by the Consultant.
Section 7.4 — Pre-Existing Materials
The Consultant has identified, on Schedule 7.4 attached hereto, all pre-existing intellectual property owned by the Consultant as of the Effective Date that may be incorporated into or used in connection with the Work Product (the "Pre-Existing Materials"). To the extent any Pre-Existing Materials are incorporated into or used in connection with any Work Product, the Consultant hereby grants to the Company a perpetual, irrevocable, royalty-free, fully paid-up, non-exclusive, worldwide license (with the right to sublicense through multiple tiers) to use, reproduce, modify, display, distribute, perform, and create derivative works of such Pre-Existing Materials, solely to the extent necessary for the Company's use of the Work Product into which such Pre-Existing Materials are incorporated. The Consultant shall not incorporate any Pre-Existing Materials into the Work Product without the prior written consent of the Company.
ARTICLE 8 — RESTRICTIVE COVENANTS
Section 8.1 — Non-Competition
The Consultant acknowledges and agrees that, as a condition to the Company's willingness to consummate the Acquisition and to enter into this Agreement, and in consideration of the Purchase Price paid in connection with the Acquisition and the compensation payable hereunder, the Consultant is bound by the non-competition covenant set forth in Section 7.06 of the APA. Without limiting the foregoing, and as a supplemental covenant in support of the Company's interests in the Acquired Business and the goodwill associated therewith, the Consultant agrees that, during the Restricted Period (i.e., the period commencing on the Closing Date and ending on August 15, 2028), the Consultant shall not, directly or indirectly, whether as a principal, owner, member, partner, shareholder (other than as a passive holder of not more than two percent (2%) of the outstanding equity securities of a publicly traded company), officer, director, employee, consultant, advisor, agent, independent contractor, or in any other capacity:
(a) own, manage, operate, control, finance, or participate in the ownership, management, operation, control, or financing of any Competing Business within the Restricted Area;
(b) be employed by or provide consulting, advisory, or other services to any Competing Business within the Restricted Area; or
(c) otherwise engage in or assist any Person in engaging in any Competing Business within the Restricted Area.
This Section 8.1 supplements, and does not limit or replace, the non-competition covenant set forth in the APA. In the event of any conflict or inconsistency between the terms of this Section 8.1 and the non-competition covenant in the APA, the more restrictive provision shall govern.
Section 8.2 — Non-Solicitation of Employees and Providers
During the Restricted Period, the Consultant shall not, directly or indirectly, whether on his own behalf or on behalf of any other Person:
(a) solicit, recruit, hire, or engage, or attempt to solicit, recruit, hire, or engage, any individual who is, or was at any time during the six (6) months preceding such solicitation, an employee, physician, nurse practitioner, physician assistant, or independent contractor of the Acquired Business or the Company or any of its Affiliates; or
(b) encourage, induce, or attempt to encourage or induce any such individual to terminate or reduce his or her employment or engagement with the Company or any of its Affiliates, or to accept employment or engagement with any other Person.
Without limiting the generality of the foregoing, the restrictions set forth in this Section 8.2 shall apply with respect to all approximately four hundred ten (410) full-time equivalent employees and sixty-two (62) clinical providers (including thirty-eight (38) physicians and twenty-four (24) nurse practitioners and physician assistants) of the Acquired Business as of the Closing Date. Notwithstanding the foregoing, this Section 8.2 shall not prohibit the Consultant from (i) making general solicitations of employment through advertisements, job postings, or similar means not specifically targeted at any individual covered by this Section 8.2, or (ii) providing an employment reference for any such individual at such individual's request.
Section 8.3 — Non-Solicitation of Patients and Payors
During the Restricted Period, the Consultant shall not, directly or indirectly, whether on his own behalf or on behalf of any other Person:
(a) solicit, divert, or take away, or attempt to solicit, divert, or take away, any patient of the Acquired Business or any referral source that has referred patients to the Acquired Business at any time during the twelve (12) months preceding such solicitation;
(b) solicit, divert, or take away, or attempt to solicit, divert, or take away, any payor of the Acquired Business, including without limitation Meridian Shield Health Plans, Inc. and any other Key Payor, for the purpose of providing healthcare services that are the same as or substantially similar to those provided by the Acquired Business; or
(c) encourage, induce, or attempt to encourage or induce any patient, referral source, or payor of the Acquired Business to terminate, reduce, or otherwise alter its relationship with the Company or the Acquired Business.
Section 8.4 — Reasonableness; Reformation
The Consultant acknowledges and agrees that the scope, duration, and geographic limitations of the restrictive covenants set forth in this Article 8 are reasonable and necessary to protect the Company's legitimate business interests, including the goodwill of the Acquired Business, the Company's investment in the Acquisition, the Confidential Information, and the relationships with patients, providers, employees, referral sources, and payors. The Consultant further acknowledges that the Consultant has received adequate consideration for such covenants, including the Purchase Price paid in connection with the Acquisition and the compensation payable under this Agreement. In the event that any court of competent jurisdiction determines that any provision of this Article 8 is invalid or unenforceable by reason of it being too broad in scope, duration, geographic area, or otherwise, the Parties intend that such court shall reform such provision to the minimum extent necessary to render it valid and enforceable, and that the remaining provisions of this Article 8 shall continue in full force and effect.
Section 8.5 — Injunctive Relief
The Consultant acknowledges and agrees that any breach or threatened breach of the restrictive covenants set forth in this Article 8 would cause the Company and its Affiliates irreparable harm for which monetary damages would be an inadequate remedy. Accordingly, in addition to all other remedies available at law or in equity (including damages), the Company and its Affiliates shall be entitled to seek temporary, preliminary, and permanent injunctive relief and specific performance to enforce the provisions of this Article 8, without the necessity of posting any bond or other security and without the requirement to prove actual damages. The Consultant hereby consents to the issuance of such injunctive relief. The rights and remedies of the Company under this Article 8 are cumulative and shall not be construed to limit any other rights or remedies that the Company may have at law, in equity, or under the APA.
ARTICLE 9 — TERMINATION
Section 9.1 — Expiration
This Agreement shall terminate automatically, without the need for any action or notice by either Party, at 11:59 p.m. (Eastern Time) on August 15, 2027, unless earlier terminated in accordance with the provisions of this Article 9.
Section 9.2 — Termination for Cause by Company
The Company may terminate this Agreement immediately upon written notice to the Consultant if any of the following events occurs:
(a) the Consultant materially breaches any provision of this Agreement and, to the extent such breach is curable, fails to cure such breach within fifteen (15) days after receipt of written notice from the Company specifying the nature of such breach in reasonable detail;
(b) the Consultant is convicted of, or enters a plea of guilty or nolo contendere to, any felony or any crime involving moral turpitude, dishonesty, or fraud;
(c) the Consultant engages in fraud, embezzlement, misappropriation, dishonesty, or gross misconduct in connection with the performance of the Services or that otherwise materially and adversely affects the Company or the Acquired Business;
(d) the Consultant is excluded, debarred, or suspended from participation in any federal or state healthcare program, including Medicare or Medicaid, or any governmental investigation or proceeding that could reasonably be expected to result in such exclusion, debarment, or suspension is commenced;
(e) the Consultant's license to practice medicine in the State of New York is suspended, revoked, restricted, or made subject to any material conditions or limitations by any governmental or regulatory authority; or
(f) the Consultant materially breaches any of the restrictive covenants set forth in Article 8 or any non-competition, non-solicitation, or confidentiality covenant set forth in the APA.
Section 9.3 — Termination for Cause by Consultant
The Consultant may terminate this Agreement upon thirty (30) days' prior written notice to the Company if:
(a) the Company fails to pay any undisputed amount due to the Consultant under this Agreement within thirty (30) days after receipt of written demand from the Consultant specifying such failure; or
(b) the Company materially breaches any other provision of this Agreement and fails to cure such breach within thirty (30) days after receipt of written notice from the Consultant specifying the nature of such breach in reasonable detail.
Section 9.4 — Termination Without Cause by Company
The Company may terminate this Agreement at any time, without cause, upon sixty (60) days' prior written notice to the Consultant.
Section 9.5 — Effect of Termination
Upon the expiration or termination of this Agreement for any reason:
(a) Accrued Fees. The Company shall pay to the Consultant all accrued and unpaid consulting fees under Section 5.1, prorated through the effective date of termination, and shall reimburse the Consultant for all approved and documented expenses incurred prior to such date in accordance with Section 5.2, in each case within thirty (30) days following the effective date of termination.
(b) Termination Fee. If this Agreement is terminated by the Company without cause pursuant to Section 9.4, the Company shall pay to the Consultant, in addition to the accrued fees described in clause (a) above, a termination fee equal to three (3) months of the Annual Fee, i.e., One Hundred Twelve Thousand Five Hundred Dollars ($112,500), payable in a lump sum within thirty (30) days following the effective date of termination. The Consultant acknowledges and agrees that such termination fee shall constitute the Consultant's sole and exclusive remedy in connection with a termination by the Company without cause under Section 9.4 (other than the accrued fees described in clause (a)).
(c) Transition Cooperation. The Consultant shall cooperate fully with the Company in the orderly transition of any ongoing matters, open projects, and pending Deliverables, and shall use commercially reasonable efforts to transfer institutional knowledge and key relationships to the Company's designated personnel.
(d) Survival. The following provisions shall survive the expiration or termination of this Agreement: Article 1 (Definitions), Article 6 (Confidential Information), Article 7 (Work Product and intellectual Property), Article 8 (Restrictive Covenants), Article 10 (Representations and Warranties; Indemnification), Article 11 (Insurance, with respect to periods during the Term), and Article 12 (General Provisions), together with any other provisions that by their nature or express terms are intended to survive.
ARTICLE 10 — REPRESENTATIONS AND WARRANTIES; INDEMNIFICATION
Section 10.1 — Consultant Representations
The Consultant represents and warrants to the Company as of the Effective Date as follows:
(a) the Consultant has full legal capacity and authority to enter into, execute, and deliver this Agreement and to perform his obligations hereunder, and the execution, delivery, and performance of this Agreement have been duly authorized by all necessary action on the part of the Consultant;
(b) the execution, delivery, and performance of this Agreement by the Consultant do not and will not (i) violate, conflict with, or result in a breach of or default under any agreement, contract, instrument, obligation, or understanding to which the Consultant is a party or by which the Consultant is bound, or (ii) violate any applicable law, rule, regulation, judgment, order, or decree;
(c) the Consultant holds a valid, unrestricted license to practice medicine in the State of New York (License No. 218649), and such license is in good standing and is not subject to any pending or threatened disciplinary action, restriction, suspension, or revocation;
(d) the Consultant has not been excluded, debarred, or suspended from participation in any federal or state healthcare program, including the Medicare and Medicaid programs, and has not been listed on the OIG's List of Excluded Individuals and Entities ("LEIE") or the General Services Administration's System for Award Management ("SAM");
(e) the Consultant is not subject to any pending or, to the Consultant's knowledge, threatened claim, action, suit, proceeding, or investigation that would materially impair the Consultant's ability to perform the Services or that would constitute a breach of any representation, warranty, or covenant contained herein;
(f) all information provided by the Consultant to the Company in connection with the APA, this Agreement, and the transactions contemplated hereby is true, correct, and complete in all material respects and does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements contained therein, in light of the circumstances under which they were made, not misleading; and
(g) the Consultant has not entered into, and during the Term will not enter into, any agreement or understanding with any Person that would conflict with or impair the Consultant's ability to perform the Services or to comply with the restrictive covenants set forth in Article 8 and the APA.
Section 10.2 — Company Representations
The Company represents and warrants to the Consultant as of the Effective Date as follows:
(a) the Company is a limited liability company duly organized, validly existing, and in good standing under the laws of the State of Delaware, and is qualified to do business in each jurisdiction in which the nature of its business or the ownership or leasing of its properties makes such qualification necessary;
(b) the Company has all requisite limited liability company power and authority to enter into, execute, and deliver this Agreement and to perform its obligations hereunder, and the execution, delivery, and performance of this Agreement have been duly authorized by all necessary action on the part of the Company; and
(c) the execution, delivery, and performance of this Agreement by the Company do not and will not (i) violate the Company's certificate of formation, limited liability company agreement, or other organizational documents, (ii) violate any applicable law, rule, regulation, judgment, order, or decree, or (iii) violate, conflict with, or result in a breach of or default under any material agreement, contract, or instrument to which the Company is a party or by which the Company is bound.
Section 10.3 — Mutual Indemnification
(a) Consultant's Indemnification. The Consultant shall indemnify, defend, and hold harmless the Company and its Affiliates, and their respective members, managers, officers, directors, employees, agents, successors, and assigns (collectively, the "Company Indemnitees"), from and against any and all claims, actions, suits, proceedings, losses, damages, liabilities, costs, and expenses (including reasonable attorneys' fees and expenses) (collectively, "Losses") arising out of or relating to (i) any breach of any representation, warranty, covenant, or obligation of the Consultant under this Agreement, (ii) the Consultant's gross negligence or willful misconduct in connection with the performance of the Services, or (iii) any claim by a governmental authority or third party arising from the Consultant's failure to comply with applicable laws, rules, or regulations in connection with the Services.
(b) Company's Indemnification. The Company shall indemnify, defend, and hold harmless the Consultant and his heirs, executors, administrators, and permitted assigns (collectively, the "Consultant Indemnitees") from and against any and all Losses arising out of or relating to (i) any breach of any representation, warranty, covenant, or obligation of the Company under this Agreement, or (ii) the Company's gross negligence or willful misconduct.
(c) Indemnification Procedures. A Party seeking indemnification under this Section 10.3 (the "Indemnified Party") shall promptly notify the other Party (the "Indemnifying Party") in writing of any claim or proceeding for which indemnification is sought; provided, however, that the failure to provide such timely notice shall not relieve the Indemnifying Party of its indemnification obligations except to the extent that the Indemnifying Party is actually and materially prejudiced by such failure. The Indemnifying Party shall have the right to assume and control the defense of any such claim or proceeding with counsel reasonably satisfactory to the Indemnified Party, at the Indemnifying Party's expense. The Indemnified Party shall cooperate fully with the Indemnifying Party in the defense of such claim and shall have the right to participate in such defense at its own expense. The Indemnifying Party shall not settle or compromise any claim without the prior written consent of the Indemnified Party (which consent shall not be unreasonably withheld, conditioned, or delayed) if such settlement or compromise would impose any liability, obligation, or restriction on the Indemnified Party or would not include a full and unconditional release of the Indemnified Party.
Section 10.4 — Limitation of Liability
EXCEPT IN CASES OF (A) BREACH OF ARTICLE 6 (CONFIDENTIAL INFORMATION) OR ARTICLE 8 (RESTRICTIVE COVENANTS), (B) OBLIGATIONS UNDER SECTION 10.3 (INDEMNIFICATION), OR (C) GROSS NEGLIGENCE OR WILLFUL MISCONDUCT, NEITHER PARTY SHALL BE LIABLE TO THE OTHER PARTY FOR ANY CONSEQUENTIAL, INCIDENTAL, SPECIAL, PUNITIVE, EXEMPLARY, OR INDIRECT DAMAGES ARISING OUT OF OR RELATING TO THIS AGREEMENT, INCLUDING DAMAGES FOR LOST PROFITS, LOST REVENUE, LOSS OF BUSINESS, OR LOSS OF GOODWILL, REGARDLESS OF WHETHER SUCH DAMAGES WERE FORESEEABLE OR WHETHER SUCH PARTY WAS ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.