MARKETING
SERVICES AGREEMENT


 


This
Marketing Services Agreement is entered into as of the 23rd day of January, 2015 by and between Mesa Pharmacy, Inc., a California
corporation (“Client”) and Products for Doctors, Inc., a California corporation (“Consultant”).


 


Article
I — Marketing Services


 


1.1 Marketing
Services. Consultant will provide the following marketing services for the benefit of Client (the “Services”):


 


(a) Consultations
with Client on the preparation of marketing materials (“Marketing Materials”), which will include descriptions of
the compounded medication offerings of Client (“Products”), Client’s general business operations, health plan
and payor arrangements, contact information and other information provided by Client necessary to provide a profile that Consultant
deems satisfactory to use in connection with the other Services to be provided.


 


(b) Direct
marketing to physicians who may elect to prescribe Products to their patients (“Prospects”).


 


(c) Market
research to identify opportunities for marketing the Products to Prospects.


 


(d) Consultations
with Client on new product opportunities and product development.


 


(e) Promotion
of Client and the Products at conferences and seminars attended by Prospects.


 


(f) Periodic
reports of marketing activities, including numbers of meetings and contacts with Prospects and appearances at conferences and
meetings.


 


The
Services shall be provided in a professional fashion, consistent with prevailing industry standards. Consultant shall devote such
time and effort to providing the Services as is reasonably necessary to comply with the terms of this Agreement; provided that
Consultant shall determine the time allocated to providing the Services and the manner in which the Services are provided.


 


1.2 Exclusions.
Nothing in Section 1.1 shall be interpreted as requiring or providing that Consultant shall:


 


(a) Pay
or furnish any inducement, discount, rebate or other compensation to any person or entity for the purpose of inducing prescriptions
or orders for Products by Prospects.


 




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(b)
Make any commitments or representations on behalf of Client except as reflected in the Marketing Materials.


 


(c) Assume
any responsibility for the accuracy of any descriptions of Products or Client’s services in any Marketing Materials as Consultant
shall be entitled to rely on Client to provide accurate information in the preparation of the Marketing Materials.


 


(d) Make
any contacts or engage in any activity that could constitute promotion of Client or its Products to any person who is not a Prospect
with professional responsibilities to patients to exercise judgment with respect to any decision to prescribe Products.


 


(e) Make
any use of intellectual property of Client, including trademarks, logos and artwork, whether in the Marketing Materials or otherwise,
except as expressly directed by Client.


 


1.3
 Compliance with Law. Consultant will, in providing the Services, comply with laws applicable to its business, maintain
an internal compliance program acceptable to Client and comply with the terms of compliance programs maintained from time to time
by Client, which are made known to Consultant by Client in writing. The parties will execute a Business Associate Addendum, in
the form attached as Exhibit A, to address any protected health information to which Consultant may require access to perform
its duties under this Agreement.


 


Article
II — Client Duties


 


2.1 Provision
of Information. Client shall produce, at its own cost and expense, the Marketing Materials and advise Consultant of any
changes in the information provided in the Marketing Materials or to be used in presentations to Prospects. Client hereby warrants
and represents to Consultant that all information in the Marketing Materials will be accurate and contain no misstatement or misleading
information that would constitute a violation of applicable law. Consultant is not authorized to amend or modify the Marketing
Materials from the form in which they are approved by Client.


 


2.2 Operation
of Client’s Business. Client will operate its business in accordance with any representations made to Consultant
pursuant to Section 2.1.


 


2.3 Compliance
with Law and Licensure. Client shall be responsible for compliance with all laws related to the operation of its business
and maintain all licenses necessary for the sales and shipment of Products.


 


2.4 Cooperation.
Client shall cooperate with Consultant as requested, including having a representative of Client, with appropriate authority
to make presentations and commitments on behalf of Client, present at meetings with Prospects.


 




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2.5 Non-Solicitation.
During the terms of this Agreement, Client shall not, directly or indirectly, (i) solicit orders from any doctor referred
by Consultant or other Consultant customer that has been referred to Client without Consultant’s written approval. (ii)
solicit any sales agents of Consultant without Consultant’s written approval.


 


Article
III — Compensation


 


3.1 Compensation.
In consideration of the provision of the Services Client shall pay to Consultant a marketing fee as provided in Exhibit B
(“Compensation”)


 


3.2 Adjustments
to Compensation. Not later than sixty (60) days prior to each Renewal Date of this Agreement, as defined in Section 4.2,
Consultant shall have the right to propose an adjustment to the rate of Compensation. If such proposed adjustments are not acceptable
to Client, Consultant shall be entitled to terminate this Agreement on not less than thirty (30) days’ notice, effective
as of the end of the then current term of this Agreement.


 


3.3 Principles
of Compensation. The parties intend that the compensation due under this Agreement shall be consistent with applicable
laws. The compensation set forth herein is based on an agreement of the parties as to the fair market value for the Services.
The parties have made such investigation as is necessary to satisfy themselves as to the appropriateness of the levels of compensation.
To the extent that any change in law, regulation or judicial interpretation of applicable law would render any element of compensation
hereunder to be illegal, upon the request of either party, the parties shall confer promptly to negotiate an adjustment to the
relevant element of compensation or modification of the Services to conform to the law. If the parties are unable to agree upon
an adjustment to compensation or modification of the Services, then either party may give notice of termination of this Agreement
in accordance with Section 6.3.


 


 3.4 Expenses
and Taxes. Consultant shall be responsible for the payment of all expenses that it incurs in the provision of the Services
and all taxes, whether based on income, payroll or otherwise, that may be imposed on the Compensation paid to Consultant under
this Agreement. Client shall have no obligation to reimburse or pay any expenses on behalf of the Consultant.


 


Article
IV — Term


 


4.1 Effective
Date and Initial Term. This Agreement shall be effective as of the date first written above (the “Effective Date”)
and terminate on July 23, 2016, representing a term of approximately eighteen months (the “Initial Term”).


 


4.2 Renewal
Terms. Not less than sixty (60) days prior to July 23, 2016, Consultant shall have the right to propose a renewal of this
Agreement for an additional one (1) year term (the “Renewal Term”) and specify any adjustment to Compensation for
such renewal term, as provided in Section 3.2. Client shall have thirty (30) days to accept or decline the proposed renewal; provided
that the failure to accept the Renewal Term within the thirty (30) day response period Client shall be deemed to have declined
the proposed renewal term and this Agreement shall terminate as of the end of the then current term.


 




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Article
V — Confidentiality


 


The
parties understand and acknowledge that during the term of this Agreement they may receive or have access to information of a
proprietary and confidential nature concerning the other party or the subject matter of this Agreement. “Confidential Information”
shall mean all information designated in writing by a party to be confidential and all information concerning a party that is
not otherwise publicly available, including but not limited to contents of any of the Products, computer codes, software applications,
customer names, and pricing information. The parties shall use Confidential Information of the other solely for the purposes of
this Agreement and enforce appropriate restrictions on their authorized employees or agents who need to know such information
to carry out the terms of this Agreement. Upon the termination of this Agreement, each party will deliver to the other party any
Confidential Information of the other, whether delivered or created pursuant to this Agreement. No party shall retain any of the
other party’s Confidential Information, and upon written request, shall certify in writing to the return or destruction
of such Confidential Information. This covenant concerning Confidential Information shall survive the termination of this Agreement
for a period of two (2) years. The parties hereto agree that Prospects that did not previously do business with Client prior to
January 23, 2015 are the confidential and proprietary information of solely the Consultant and constitute trade secrets of the
Consultant under the California Uniform Trade Secrets Act.


 


Article
VI — Termination


 


6.1. Termination
for Cause by Either Party. Except as provided in Sections 6.2 and 6.3, either party may terminate this Agreement for cause
upon written notice to the other party specifying the nature of the alleged breach of this Agreement. For purposes of this Agreement,
“cause” shall be construed to mean a material breach of an obligation to be performed hereunder, that is not cured
within thirty (30) days or for which reasonable steps to cure are not undertaken and diligently and continuously pursued if such
cure cannot reasonably be achieved during such thirty (30) day period.


 


6.2. Bankruptcy.
Either party may terminate this Agreement effective immediately upon written notice, if the other party files a petition in
bankruptcy, is adjudicated bankrupt, or takes advantage of the insolvency laws of any jurisdiction, makes an assignment for the
benefit of creditors, is voluntarily or involuntarily dissolved, or has a receiver, trustee, or other court officer appointed
with respect to its property.


 


6.3 Violation
of Law. Either party may terminate this Agreement immediately upon written notice, if the other party is determined by
a governmental authority to be operating in violation of any law that governs this Agreement unless the parties are unable to
negotiate an adjustment to the compensation or modification to the Services in accordance with Section 3.3 to conform to the requirements
of the law and address all legal obligations related to the violation.


 




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6.4 Effects
of Termination. Upon termination of this Agreement, as provided herein, neither party shall have any further obligations
hereunder except for (a) obligations accruing prior to the date of termination, and (b) obligations, promises, or covenants contained
herein that are expressly made to extend beyond the Term of this Agreement, including, without limitation, confidentiality obligations.
The termination of the Agreement shall not relieve either party of duties or obligations to promptly account for and pay to the
other all amounts due under this Agreement through the date of such termination; provided that in the event of a termination in
accordance with Section 6.3, the parties’ obligations shall be limited by conformity to applicable law, i.e., neither party
shall be entitled to performance of any obligation or payment of any amount that would constitute a violation of law. By way of
clarification and notwithstanding any provisions herein or in any exhibits hereto to the contrary, if for any reasons this Agreement
is terminated or is not renewed, all obligations under this Agreement to pay Compensation, including, without limitation, with
respect to the provisions under Exhibit B, shall continue and remain in full force and effect with respect to all orders or prescriptions
for Products from Prospects that (i) were received by the Client on or prior to the effective date of termination or expiration
of this Agreement and (ii) are received by the Client for the 12 month period commencing on the effective date of termination
or expiration of this Agreement.


 


Article
VII — Indemnification


 


7.1
Indemnification of Consultant. Client shall indemnify and hold harmless Consultant, its shareholders, directors, officers,
agents, members, managers and employees and their respective successors and assign (“Consultant Indemnified Parties”)
from all cost, loss or expense (including reasonable attorneys’ fees) which the Consultant Indemnified Parties may suffer
as a result of the breach by Client of this Agreement or any violation of law by Client which affects the Consultant Indemnified
Parties.


 


7.2
Indemnification of Client. Consultant shall indemnify and hold harmless Client, its shareholders, directors, officers,
agents, members, managers and employees and their respective successors and assigns (“Client Indemnified Parties”)
from all cost, loss or expense (including reasonable attorneys’ fees) which the Client Indemnified Parties may suffer as
a result of the breach by Consultant of this Agreement or any violation of law by Consultant which affects the Client Indemnified
Parties.


 


7.3
Procedure for Indemnification. Upon notice of any claim by an Indemnified Party (whether a Consultant Indemnified Party
or a Client Indemnified Party) under this Article VII, the other party shall assume the defense of such Indemnified Party with
counsel reasonably acceptable to such indemnified party.. If the party obligated to provide indemnification fails to assume the
defense within such period of time as is necessary to avoid prejudice to the legal position of the Indemnified Party, the Indemnified
Party shall be entitled to engage counsel and defend such claim at the expense of the other party.


 




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Article
VIII — Dispute Resolution


 


8.1. Party
Negotiations. The parties will attempt to resolve all claims, disputes or questions arising under or related to this Agreement
by negotiation conducted by duly authorized representatives. A party that is aware of an issue arising under this Agreement shall
give prompt written notice to the other party of such matter.


 


8.2. Venue
Arbitration. Any controversy or claim arising out of or relating to this Agreement, or the breach thereof, shall be
settled by arbitration administered by the American Arbitration Association in accordance with its Commercial Arbitration Rules,
including the Optional Rules for Emergency Measures of Protection, and judgment on the award rendered by the arbitrator(s) may
be entered in any court having jurisdiction thereof. The Arbitration shall be conducted in Orange County, California.


 


Article
IX — General Provisions


 


9.1. Governing
Law. This Agreement and all rights and remedies arising hereunder or related hereto shall be governed by and construed
and enforced in accordance with the laws of the State of California, without regard to choice of law.


 


9.2. Relationship
of the Parties. For purposes of this Agreement and all Services to be provided hereunder, the parties shall be and shall
be deemed to be independent contractors and not or employees of the other party. Consultant has no authority as an agent of Client
except to the extent specified in this Agreement. Consultant will not make any statements, representations, warranties or other
commitments of any kind which are binding on Client, except as may be expressly provided for herein or otherwise authorized in
writing.


 


9.3. Entire
Agreement and Waiver. This Agreement contains the entire agreement between the parties hereto concerning the subject matter
hereof and supersedes all prior and contemporaneous agreements, arrangements, negotiations and understandings between the parties
relating to the subject matter hereof. There are no other understandings, statements, promises or inducements, oral or otherwise
contrary to the terms of this Agreement. No representations, warranties, covenants or conditions, express or implied, whether
by statute or otherwise, other than as set forth herein, have been made by any party hereto. No waiver of any term, provision
or condition of this Agreement whether by conduct or otherwise, in any one or more instances, shall be deemed to be, or shall
constitute, a waiver of any other provision hereof, whether or not similar, nor shall such waiver constitute a continuing waiver,
and no waiver shall be binding unless executed in writing by the party making the waiver.


 


9.4. Amendment.
No supplement, modification or amendment of this Agreement shall be binding or enforceable unless executed in writing by duly
authorized representatives of the parties hereto.


 




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9.5. Assignment.
This Agreement and rights and duties hereunder may not be assigned by either party without the prior written consent of the
other party; provided that either party may assign this Agreement to an entity that is owned, controlled by or under common control
with such party without the consent of the other.


 


 9.6. Severability.
Should any provision of this Agreement be declared by a court of competent jurisdiction to be invalid, void, or unenforceable
at law or in equity, it is the express intention of the parties hereto that such part, term, or provision shall be construed in
such manner as to provide for the enforcement thereof to the maximum extent and in the broadest scope permitted under law and
all remaining parts, terms and provisions shall remain in full force and effect and shall in no way be invalid or impaired or
affected thereby.


 


9.7. No
Third Party Beneficiaries. Nothing in this Agreement, whether express or implied is intended to confer upon any person
other than the parties hereto, their respective representatives, and permitted assigns, any rights or remedies under or by reason
of this Agreement.


 


9.8 Counterparts.
This Agreement may be executed in one or more counterparts, each of which shall be deemed an original, and all of which together
shall constitute one and the same instrument. For purposes of this Agreement, an electronic or digital image of a signature shall
be treated as an original.


 


9.9. Construction
of Agreement. This Agreement is a negotiated document, based on input by both parties and shall not be construed against
a party on the theory that the party was responsible for the language being construed. Every provision of this Agreement shall
be construed as though the parties participated equally in the drafting of the language of the provision. Any legal rule of construction
that a document is to be construed against the drafting party shall not be applicable and is expressly waived by the parties.


 


9.10. Notices.
All notices, requests and other communications hereunder shall be in writing and shall be deemed to have been given only if
mailed, certified return receipt request, or if sent by a well-recognized private delivery service or if personally delivered
to, or if sent by fax with the original thereby sent by a means specified in this Section 9.10:


 


If
to Consultant:


Products
for Doctors

27001 La Paz, Suite 348, Mission Viejo, CA 92691

Attn: Richard J. Valenta


 Fax:
(888) 438-7274


 


If
to Client:


Mesa
Pharmacy, Inc.

18013 Sky Park Cir, Suite D

Irvine, CA 92614

Attn: President

Fax: (949) 955-2925


 




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All
notices, requests and other communications shall be deemed received on the date of acknowledgment or other evidence of actual
receipt in the case of certified mail, courier delivery or personal delivery or in the case of fax delivery, upon the date of
fax receipt provided the original is delivered within two (2) business days. Any party hereto may designate different or additional
parties for the receipt notice, pursuant to notice given in accordance with the foregoing.


 


9.11.
Survival. The following provisions of this Agreement shall survive the termination or expiration of this Agreement
and shall remain in full force and effect: Article V (Confidentiality), Article VI (Termination), Article VII (Indemnification),
Article VIII (Dispute Resolution), Article (IX)(General Provisions), and Exhibit B (Compensation).


 


IN
WITNESS WHEREOF, the parties to this Agreement have executed and delivered this Agreement on the date first above written.



 


	 	MESA PHARMACY, INC.
	 	 	 
	 	By:	/s/
    Edward Kurtz
	 	Title:	 Chief Executive Officer
	 	 	 
	 	PRODUCTS
    FOR DOCTORS, INC.
	 	 	 
	 	By:	/s/
    James Bradford
	 	Title:	Chief
    Executive Officer


  




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EXHIBIT
A


BUSINESS
ASSOCIATE ADDENDUM


 


This
Business Associate Addendum (“Addendum”) supplements and is made a part of the underlying Marketing Services Agreement
by and between Mesa Pharmacy, Inc. (“Covered Entity”) and Products for Doctors (“Business Associate”),
(each a “Party” and collectively, the “Parties”), dated as of January 23, 2015 (the “Agreement”).


 


RECITALS


 


WHEREAS,
the Parties have entered into the Agreement, to which this Addendum is appended, under which Business Associate has agreed to
provide certain services to Covered Entity.


 


WHEREAS,
under the terms of the Agreement, Covered Entity shall provide, and Business Associate shall have access to, certain information
some of which may constitute Protected Health Information (“PHI”) and Electronic Protected Health Information (“ePHI”).


 


WHEREAS,
the Parties desire to protect the individual privacy and provide for the security and confidentiality of the PHI and ePHI disclosed
to Business Associate by Covered Entity or generated by Business Associate on behalf of Covered Entity in accordance with the
Health Insurance Portability and Accountability Act of 1996 (Public Law 104-191 ) (“HIPAA”) and its accompanying privacy
and security regulations (“HIPAA Regulations”), Health Information Technology for Economic and Clinical Health Act,
enacted as part of the American Recovery and Reinvestment Act of 2009 (Public Law 111-5), and its attendant regulations and guidance
(“HITECH Act”), and other applicable laws.


 


WHEREAS,
consistent with Section 1.3 of the Agreement, the Parties desire to set forth the terms under which Business Associate is required
to handle any PHI and ePHI disclosed to it by Covered Entity, or created or received on behalf of Covered Entity.


 


WHEREAS,
as part of the HIPAA Regulations, Covered Entity is required to obtain “satisfactory assurances” from Business Associate
that it will appropriately handle and safeguard any PHI disclosed to it by Covered Entity or generated by it on behalf of Covered
Entity and that Business Associate will implement safeguards that “reasonably and appropriately’’ protect the
confidentiality, integrity, and availability of any ePHI that it creates, receives, maintains, or transmits on behalf of Covered
Entity. Accordingly, the Parties enter into this Addendum governing Business Associate’s use and disclosure of PHI and Business
Associate’s implementation of safeguards to reasonably and appropriately protect the confidentiality, integrity, and availability
of ePHI.


 




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In
consideration of the mutual promises below and the exchange of information pursuant to this Addendum, the Parties agree as follows:


 


1. Definitions:


 


a. Data
Aggregation. “Data Aggregation” shall have the same meaning given to such term in 45 C.F.R. § 164.501 and
shall include the combining of PHI received or created by Business Associate to permit data analyses relating to Health Care Operations
of Covered Entity.


 


b. Designated
Record Set. “Designated Record Set” shall have the same meaning given to such term in 45 C.F.R. § 164.501
and shall include patients’ medical or billing records or any Covered Entity of records which contains PHI that are maintained,
in whole or in part, by or for Covered Entity.


 


c. Electronic
Protected Health Information. “Electronic Protected Health Information” or “ePHI” shall have the same
meaning as the term “electronic protected health information” in 45 C.F.R. § 160.103, limited to the information
created, received, maintained or transmitted by Business Associate from or on behalf of Covered Entity.


 


d. Health
Care Operations. “Health Care Operations” shall have the meaning set out in its definition at 45 C.F.R. §
164.501, as such provision is currently drafted and as it is subsequently updated, amended or revised.


 


e. Individual.
“Individual” shall have the same meaning as the term “individual” in 45 C.F.R. § 160.103 and shall
include a person who qualifies as a personal representative in accordance with 45 C.F.R. § 164.502(g).


 


f. Privacy
Rule. “Privacy Rule” shall mean the Standards for Privacy of Individually Identifiable Health Information at 45
C.F.R. part 160 and part 164, Subparts A and E.


 


g. Protected
Health Information. “Protected Health Information” or “PHI” shall have the same meaning as the term
“protected health information” in 45 C.F.R. § 160.103, limited to the information created, received, maintained
or transmitted by Business Associate from or on behalf of Covered Entity.


 


h. Required
by Law. “Required by Law” shall have the same meaning as the term “required by law” in 45 C.F.R. §
164.103.


 


i. Secretary.
“Secretary” shall mean the Secretary of the Department of Health and Human Services or his or her designee.


 


j. Security
Rule. “Security Rule” shall mean the Standards for Security of Electronic Protected Health Information at 45 C.F.R.
part 160 and part 164, Subparts A and C.


 


Any
other terms used in this Addendum, but not otherwise defined, shall have the same meaning as those terms in the Privacy Rule,
Security Rule, or any other HIPAA Regulations existing now or promulgated in the future.


 


2. Limits
on Use and Disclosure of PHI: Except as otherwise specified herein, Business Associate may use and disclose PHI only as necessary
to perform its obligations under the terms of the Agreement. All other uses and disclosures not specifically permitted or required
by this Addendum or as required by state or federal law are strictly prohibited.


 




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3. Privacy
Rule Obligations and Activities of Business Associate: With regard to the use and/or disclosure of PHI, Business Associate
shall:


 


a. Not
use or further disclose PHI other than as permitted or required by this Addendum or as Required by Law;


 


b. Use
appropriate safeguards to prevent the use or disclosure of PHI other than as provided for by this Addendum;


 


c. Mitigate,
to the extent practicable, any harmful effect that is known to Business Associate of a use or disclosure of PHI by Business Associate
in violation of the requirements of this Addendum;


 


d. Report
to Covered Entity’s designated privacy officer or other designated administrator or officer, within a reasonable period
of time, any use and/or disclosure of the PHI that is not permitted or required by the terms of this Addendum and of which Business
Associate becomes aware;


 


e. Require
that any and all agents, including subcontractors, that create, receive, maintain or transmit PHI on behalf of Business Associate
for services provided to Covered Entity agree, in writing, to adhere to the same restrictions and conditions on the use and disclosure
of PHI that apply throughout this Addendum to Business Associate with respect to such PHI;


 


f. Upon
request of Covered Entity, provide access to PHI maintained by Business Associate on behalf of Covered Entity in a Designated
Record Set to Covered Entity or to an Individual, as directed by Covered Entity, in accordance with the requirements of 45 C.F.R.
§ 164.524. Such access shall be permitted within a reasonable period of time and in a manner designated by Covered Entity;


 


g. Upon
request of Covered Entity, amend PHI maintained in a Designated Record Set by Business Associate on behalf of Covered Entity.
Any such amendments shall be made within a reasonable period of time and in a manner designated by Covered Entity. Further, Business
Associate shall incorporate any such amendments into the PHI maintained by it in a Designated Record Set on behalf of Covered
Entity;


 


h. Make
available its internal books, and records relating to the use and disclosure of PHI received from, or created or received by Business
Associate on behalf of, Covered Entity available to Covered Entity, or to the Secretary, in a time and manner designated by Covered
Entity or the Secretary, for purposes of the Secretary determining Covered Entity’s compliance with the Privacy Rule;


 


i. Make
information available to Covered Entity regarding Business Associate’s disclosures of PHI, and document such disclosures,
sufficient to permit Covered Entity to respond to a request by an Individual for an accounting of disclosures of PHI in accordance
with 45 C.F.R. § 164.528; and


 




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j. Upon
termination of the Addendum, as provided for in Section 8 herein, if feasible, return to Covered Entity, or, at Covered Entity’s
request, destroy, all PHI received from, or created or received by, Business Associate on behalf of Covered Entity that Business
Associate still maintains in any form and retain no copies of such PHI or, if such return or destruction is not feasible, Business
Associate shall notify Covered Entity in writing of the conditions that make such return or destruction infeasible and shall extend
the protections of this Addendum to such PHI and limit further use or disclosure to those purposes that make the return or destruction
of such PHI infeasible, for so long as Business Associate maintains such PHI. This provision shall apply to PHI that is in the
possession of subcontractors or agents of Business Associate.


 


4. Permitted
Uses and Disclosures by Business Associate. Except as otherwise limited m this Addendum:


 


a. Business
Associate may use or disclose PHI to perform functions, activities, or services for, or on behalf of, Covered Entity as specified
in the Agreement, provided that such use or disclosure would not violate the Privacy Rule or other applicable state or federal
laws if done by Covered Entity itself;


 


b. Business
Associate may use PHI in its possession for the proper management and administration of Business Associate or to carry out the
legal responsibilities of Business Associate;


 


c. Business
Associate may disclose PHI for the proper management and administration of Business Associate, provided that such disclosures
are Required By Law, or provided that Business Associate represents to Covered Entity in writing that it has obtained reasonable
assurances, from the person to whom the PHI is disclosed that it will remain confidential and be used or further disclosed only
as Required By Law or for the purpose for which it was disclosed to the person, and that person notifies Business Associate of
any instances of which it is aware in which the confidentiality of the PHI received has been breached;


 


d. Except
as otherwise limited in this Addendum, Business Associate may use PHI to provide Data Aggregation services to Covered Entity as
permitted by 45 C.F.R. § l64.504(e)(2)(i)(B); and


 


e. Business
Associate may use PHI to report violations of law to appropriate state or federal authorities as permitted by 45 C.F.R. §
164.502(b)(2)(v).


 


5. Privacy
Rule Obligations of Covered Entity: Covered Entity shall:


 


a. Provide
Business Associate with its notice of privacy Covered Entity’s produced in accordance with 45 C.F.R. § 164.520, as
well as any changes, amendments or modifications to such notice;


 


b. Provide
Business Associate with any changes in, or revocation of, authorization by an Individual to use or disclose PHI, if such changes
affect Business Associate’s permitted or required uses and disclosures;


 




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c. Notify
Business Associate of any restriction to the use or disclosure of PHI that Covered Entity has agreed to in accordance with 45
C.F.R. § 164.522, provided such changes affect Business Associate’s permitted or required uses and disclosures of PHI;
and


 


d. Not
request Business Associate to use or disclose PHI in any manner that would not be permitted under the Privacy Rule if done by
Covered Entity, except for Data Aggregation or management and administrative activities of Business Associate.


 


6. Security
Rule Obligations of Business Associate: With regard to the Security Rule, Business Associate agrees that it shall:


 


a. Implement
administrative, physical, and technical safeguards that reasonably and appropriately protect the confidentiality, integrity and
availability of the ePHI that Business Associate creates, receives, maintains or transmits on behalf of Covered Entity;


 


b. Ensure
that any agent, including a subcontractor, to whom Business Associate provides such ePHI agrees to implement reasonable and appropriate
safeguards to protect that ePHI; and


 


c. Report
to Covered Entity any “security incident” (as that term is defined at 45 C.F.R. § 164.304) of which Business
Associate becomes aware.


 


7. Breach
Notification: Business Associate shall be required to notify Covered Entity of any breach of “unsecured PHI” (as
that term is defined at 42 U.S.C. § 17932(h)(1), 45 C.F.R. § 164.402 and in further guidance issued by the Secretary
under Section 13402(h)(2) of the HITECH Act) in accordance with 45 C.F.R. §164.410, without reasonable delay but in no event
later than ten (10) calendar days after discovery of a breach; provided, however, that the Parties acknowledge and agree that
this Section constitutes notice by Business Associate to Covered Entity of the ongoing existence and occurrence of attempted but
Unsuccessful Security Incidents (as defined below) for which notice to Covered Entity by Business Associate shall be required
only upon request. “Unsuccessful Security Incidents” shall include, but not be limited to, pings and other broadcast
attacks on Business Associate’s firewall, port scans, unsuccessful log-on attempts, denials of service and any combination
of the above, so long as no such incident results in unauthorized access, use or disclosure of PHI. The notice of any breach of
unsecured PHI must include, to the extent possible, the identification of each individual whose unsecured PHI has been, or is
reasonably believed by Business Associate to have been accessed, acquired, used or disclosed during the breach and any of the
following information Covered Entity is required to include in its notice to the individual pursuant to 45 C.F.R. §164.404(c):


 


a. A
brief description of what happened, including the date of the breach and the date of discovery of the breach, if known;


 


b. A
description of the types of unsecured PHI that were involved in the breach (e.g. social security number, full name, date of birth,
address, diagnosis);


 




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c. Any
steps the individual should take to protect themselves from potential harm resulting from the breach;


 


d. A
brief description of what is being done to investigate the breach, mitigate the harm and protect against future breaches; and


 


e. Contact
procedures for individuals to ask questions or learn additional information which shall include a toll-free number, an e-mail
address, Web site, or postal address (this subsection e. is only applicable if Covered Entity specifically requests Business Associate
to establish contact procedures).


 


f. Such
information must be submitted to Covered Entity at the time Covered Entity is required to notify the individual of a breach of
unsecured PHI or as promptly thereafter as the information becomes available.


 


8. Term
and Termination:


 


a. The
Term of this Addendum shall be effective as of the commencement of the term of the Agreement, and shall terminate when the Agreement
terminates.


 


b. If
Covered Entity makes the determination that Business Associate has breached a material term of this Addendum, Covered Entity may:
(i) provide Business Associate with 30 days written notice of the existence of an alleged material breach; and (ii) afford Business
Associate an opportunity to cure the alleged material breach upon mutually agreeable terms. Nonetheless, in the event that mutually
agreeable terms cannot be achieved within 30 days, such a failure to cure the alleged material breach shall be grounds for the
immediate termination of this Addendum and the Agreement.


 


c. Upon
Business Associate’s knowledge of a material breach by Covered Entity, Business Associate shall notify Covered Entity of
such breach in reasonable detail, and provide an opportunity for Covered Entity to cure the breach or violation, or if cure is
not possible, Business Associate may immediately terminate this Agreement.


 


d. In
the event this Addendum is terminated, the destruction, return or continued maintenance of PHI in possession of Business Associate
shall be controlled by Section 3.j of this Addendum, and Business Associate’s obligations set forth thereunder shall survive
termination of this Addendum.


 


9. Integration:
This Addendum shall be incorporated into and made a part of the Agreement. In the event that any term or provision of this Addendum
contradicts or conflicts with a term or provision of the Agreement, that term or provision of this Addendum shall control.


 


10. Miscellaneous:


 


a. Regulatory
References. A reference in this Addendum to a section in the Privacy Rule means the section as in effect or as amended, and
for which compliance is required.


 




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b. Survival.
The respective rights and obligations of Business Associate under Section 3.j of this Addendum shall survive the termination of
this Addendum.


 


c. Interpretation.
Any ambiguity in this Addendum shall be resolved in favor of a meaning that permits compliance with the Privacy Rule and the Security
Rule.


 


d. No
Third Party Rights. This Addendum shall be binding upon and inure to the benefit of the Parties hereto and their respective
successors and assigns; provided, however, that nothing in this Addendum is intended, nor shall it be construed, to confer upon
any person or entity other than the Parties hereto and their respective successors and assigns, any rights remedies, obligations
or liabilities whatsoever.


 


e. Applicable
Law. The validity, enforceability and interpretation of this Addendum shall be governed by the same laws as are applicable
to the Agreement and by the Privacy Rule and the Security Rule.


 


f. Entire
Agreement. This Addendum constitutes the entire agreement between the Parties regarding the confidentiality of PHI and the
security and integrity of ePHI, and supersedes all other agreements, express or implied, oral or written, between the Parties
related to the subject matter of this Addendum.


 


g. No
Limitations on Liability. No limitations in, or exclusions from, liability set forth in the Agreement or any other agreement
between the Parties shall apply to breaches of any of the provisions contained in this Addendum.


 


IN
WITNESS WHEREOF, the Parties have duly executed this Addendum on the day and year first above written.


 


	Mesa
    Pharmacy, Inc.	 	Products
    for Doctors
	 	 	 	 	 
	By:	/s/
    Edward Kurtz	 	By:	/s/
    James Bradford
	 	 	 	 	 
	Title:	Chief
    Executive Officer	 	Title:	Chief
    Executive Officer


  




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Exhibit
B

compensation


 


Workers
Compensation Beneficiaries


 


Client
shall pay the Consultant:


 


(a)
All Qualified Prescriptions (as defined below) will be sent to a factoring company. In the event that Client is unable to secure
a factoring arrangement, Client will provide Consultant within 48 hours within receiving notice. For accounts receivable resulting
from Qualified Prescriptions which are sold to third parties for factoring – thirteen percent (13%) of the face amount of
the accounts receivable. By way of clarification, Consultant is not paid based on the cash proceeds paid to Client by the third
party factor, but instead is paid based on the gross amount of the accounts receivables resulting from Qualified Prescriptions
and notwithstanding the amount of collections or cash received by Client with respect to such accounts receivable that are factored.
Such amounts shall be due and payable to Consultant within 5 days with respect to all proceeds that are received from accounts
receivable factoring.(b) for accounts receivable resulting from Prescriptions which are not sold to third parties for factoring
due to Client not being able to secure a factoring arrangement or where Prescription is not qualified or where a Prescription
is rejected by factoring company – fifty percent (50%) of the amounts collected by Client after first deducting 25% of the
amount collected for Client’s collections services. Such amounts shall be due and payable to Consultant by the 15th day
of each calendar month for the prior month with respect to all amounts collected by Client from accounts receivable that are not
sold to third party factors.


 


Qualified
Prescriptions


 


A
Qualified Prescription shall mean a Prescription for Products from a Prospect attributable to Consultant or Consultant’s
Services (referred to herein as a “Prescription”) and that contains all reasonably necessary insurance information
as well as a complete copy of the Request for Authorization and PR2’s (i.e., a doctor’s progress report) that were
submitted to the insurance company specifically stating the medication to be dispensed as well as the reasons for treatment per
applicable law. In the event Client is paid on a Non-Qualified Prescription by either a factoring company or through collections,
Consultant will still be entitled to Compensation.


 


Rejection
of Prescriptions


 


Company
may reject a prescription, with notice to Consultant and the prescribing physician if Company concludes that the prescription
meets the following criteria:


 


	 	1.
    	It
    appears to be fraudulent.
	 	 	 
	 	2.
    	The
    case to which the prescription pertains has been settled and no further claims will be allowed.
	 	 	 
	 	3.
    	The
    prescription has been the subject of a previous claim which has been paid.
	 	 	 
	 	4.
    	The
    prescription is excessive, unnecessary or otherwise unreasonable for the care of the patient.
	 	 	 
	 	5.
    	The
    prescription relates to an unconfirmed worker’s compensation claim not in EDEX.
	 	 	 
	 	6.
    	The
    carrier responsible for the claim is insolvent and the California Insurance Guaranty Association has not assumed responsibility
    for payment of the claim.


 




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In
the event that a prescription is rejected, no compensation shall be payable to Consultant; provided that the prescribing physician
shall have a reasonable opportunity to replace the rejected prescription with a Qualified Prescription, or to demonstrate to the
sole satisfaction of Client that the basis for rejection is inappropriate.


 


Disallowed
and Unpaid Claims


 


In
the event that claims based on Qualified Prescriptions are disallowed, reversed by a payor, rejected by a factor or otherwise
unpaid, and provided that and to the extent that Client previously paid Consultant with respect to such claim in accordance with
this Exhibit B, Client shall be entitled to offset the amount of such disallowance or non-payment against the next payment of
compensation due Consultant; provided that prior to taking an offset, Client shall give notice of the reason for disallowance
or non-payment and Consultant shall have thirty (30) days in which to investigate and remedy the basis for disallowance.


 


Right
to Inspect and Access Information


 


During
the Term of this Agreement and for an 18 month period after the termination or expiration of this Agreement, or until any on going
dispute with Consultant is resolved if such a dispute continues beyond such 18 month period, Client hereby grants to Consultant
and Consultant’s advisors and accountants the following rights which may be exercised at any time and from time to time:


 


a.
read only remote access via the internet to Consultant’s billing and collections software and systems so that Consultant
can access and monitor the status of all Prescriptions and orders; and


 


b.
and on site access during regular business hours to all of Client’s books and records that relate to prescriptions and to
billings and collections by Client with respect to its Products and prescriptions and that relate to the determination of Consultant’s
Compensation under the provisions of this Agreement .


 






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