Document:

ex10_1.htm

Exhibit 10.1

 

The Partnership has redacted certain confidential information in this agreement in reliance upon its confidential treatment request that it has filed with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934. In this agreement, we indicate each redaction by use of asterisk *.

	
FINAL COPY
PhysicalTransaction Confirmation 

  

Date :  October 10, 2008
To:      PETROLEUM DEVELOPMENT CORPORATION

 

	  	
CONFIDENTIAL
Transaction Number:   155029
Version:                          2
Contract Term:              01/01/2009-01/01/2011

The following confirms the terms of the agreement for the transaction made on April 22,2008 between SUNCOR ENERGY MARKETING INC. and PETROLEUM DEVELOPMENT CORPORATION:

	
COUNTERPARTY:
	
PETROLEUM DEVELOPMENT CORPORATION
	
CONTACT INFO :

	  	
Trader: Tina R. Smith
	
Name: Confirmation Department

	  	
120 GENESIS BLVD
	
Phone: 304-842-8930

	  	
BRIDGEPORT, WV, USA 26330
	
Fax: 1-304-842-8936

	  	  	  
	
COMPANY :
	
SUNCOR ENERGY MARKETING INC.
	
CONTACT INFO :

	  	
Trader: Tim Kirwin
	
Name: Jim Sylvester

	  	
1500, 112 Fourth Avenue S.W.
	
Phone: (403) 920-8346

	  	
Calgary, AB, Canada T2P 2V5
	
Fax: (403)205-7964

	
Suncor Receives

	 
	
B-1
	
Physical/Financial
	
PHYSICAL

	 	 	 
	  	
Delivery Point:
	
Suncor Lease Volume

	 	 	 
	  	
Quantity:
	
Approx, 4,300 BBL/DAY

	 	 	 
	  	
Quality:
	
Colorado Sweet

	 	 	 
	  	
Term:
	
01/01/2009-12/31/2010

	 	 	 
	  	
Price:
	
NYMX_WTISPOT In USD/BBL Current Business Month

* USD/BBL

Payment Terms:    Payable In United States funds on or before the 20th of the month following the month of delivery

 

Special Provisions:

 

	PETROLEUM DEVELOPMENT CORPORATION	 	SUNCOR ENERGY MARKETING INC.
	 	  	 	 	  
	Signature	
/s/ Tina R. Smith
	 	Signature	/s/ Shawn Bray
	Name:	
TINA R. SMITH

Vice President
	 	 	SHAWN BRAY, Interim Mgr. Risk-Controls
	 	  	 	 	  
	Signature	
/s/ Eric R. Stearns
	 	Signature	/s/ Richard Brown
	Name:	
ERIC R. STEARNS

Executive Vice President
	 	 	
RICHARD BROWN
Vice President

	 	  	 	 	
Crude Oil Marketing & Trading

	 	  	 	 	
Suncor Energy Marketing Inc.

This Transaction Confirmation confirms the terms of the transaction between the parties and is subject to the terms and conditions of the Master US Crude Agreement dated July 01, 2008.

If the terms and conditions of this Confirmation as stated above accurately reflect the mutual agreement of the parties hereto, please execute this confirmation in the appropriate space provided below and return one (1) fully executed copy to Suncor by 5:00 P.M. Calgary, Alberta
time on the second (2) Business Day after the clay on which this confirmation has been received (the "Confirm Deadline"). If no objection to this Confirmation has been received in writing by the Confirming Party by the Confirm Deadline, this Confirmation shall be deemed to accurately reflect the mutual agreement of the Parties hereto and shall be binding and enforceable against Seller and Buyer, regardless of whether or not It has been executed by either Party.

	
Runtime:  2008-Oct-10 10:39 am
	
Trans No: 155029
	
Page 1 of 1

 

  

  

  

Master Agreement for U.S. Crude Oil Purchase, Sale, or Exchange Transactions

THIS MASTER AGREEMENT (the "Agreement") is dated July 1, 2008, and is made between Suncor Energy Marketing Inc. ("SEMI") and Petroleum Development Corporation ("Counterparty") (referred to individually as a "Party" and collectively
as the "Parties").

Each of the Parties hereby agrees and confirms that:

1      Acceptance of GTCs: It has accepted the attached ConocoPhillips General Provisions for Domestic Crude Oil Agreements ("GTCs") and the attached Amendments to the GTCs (the "Amendments"),
to govern any and all transactions entered into between SEMI and Counterparty for the purchase, sale, or exchange of crude oil, condensate or other related liquid substances.

2      Master Agreement: All transactions entered into between SEMI and Counterparty for the purchase, sale, or exchange of crude oil, condensate or other related liquid substances
shall be subject to this Agreement, the GTCs, and the Amendments and shall be considered as being transacted under a single master agreement, and, in respect of any such transaction, this Agreement, the GTCs, and the Amendments will be incorporated into and form part of each transaction, without the need to attach a copy of same to any transaction document or confirmation

3       Representations:

 

a                 It is acting for its own account, and has made its own independent decisions to enter into any crude oil purchase and sale transaction, and any such transaction is appropriate or proper for it based upon its own judgment and upon advice from
such advisors as it has deemed necessary; it is not relying on any communication (written or oral) of the other Party as investment advice or as a recommendation to enter into any transaction; no communication received from the other Party shall be deemed to be an assurance or guarantee as to the expected results of any transaction; it is capable of assessing the merits of and understanding (on its own behalf or through independent professional advice), and understands and accepts the terms, conditions and risks
of each transaction; it is capable of assuming, and assumes, the risks of each transaction; and the other Party is not acting as a fiduciary for or an advisor to it in respect of any transaction; and

 

b                 it has all necessary corporate (or analogous) and other requisite authorizations to execute, deliver and perform this Agreement and any transaction with the
other Party entered into by it

4      Forward Contract: This Agreement, the GTCs, the Amendments, any transaction confirmation, special provisions, or other transaction document, and any credit support document provided with respect thereto shall together constitute a "forward
contract" within the meaning of the United States Bankruptcy Code and Buyer and Seller shall each be deemed to be "forward contract merchants" within the meaning of the United States Bankruptcy Code.

5      Confirmation Procedure: It will be legally bound from the time it agrees (orally or otherwise) to the terms of a transaction; provided that the in the case of each individual transaction to purchase or sell crude oil, condensate or other
related liquid substances, the Party that is the seller shall confirm the terms of the transaction by sending a confirmation (also sometimes referred to as special provisions) to the other Party by facsimile or other electronic means within two (2) business days after the Parties have agreed to enter into a transaction (including orally), and, if the receiving Party does not notify the confirming Party, by facsimile or other mutually agreeable electronic means, of material differences between the confirmation
and the receiving Party's understanding of the transaction terms, or otherwise object to the confirmation, within two (2) business days of receipt of the confirmation, the confirmation will then be deemed to constitute the receiving Party's agreement to the terms of the transaction as set out in the confirmation.

If the Party that is the seller in an individual transaction fails to send the other Party a confirmation within two (2) business days after the Parties have agreed to enter into a transaction (including orally) as aforesaid, the other Party may confirm the terms of the transaction by sending a confirmation to the Party that is the seller
by facsimile or other electronic means on the third (3rd) business day after the transaction is entered into, and, if the receiving Party does not notify the confirming Party, by facsimile or other mutually agreeable electronic means, of material differences between the confirmation and the receiving Party's understanding of the transaction terms within two (2) business days of receipt of the confirmation, the confirmation will then
be deemed to constitute the selling Party's agreement to the terms of the transaction as set out in the confirmation provided by the buyer.

	SUNCOR ENERGY MARKETING INC,	 	PETROLEUM DEVELOPMENT CORPORATION
	 	  	 	 	  
	Per:	
/s/ Richard Brown
	 	Per:	
/s/ Eric R Stearns

	Name: 	
RICHARD BROWN
	 	Name: 	
ERIC R STEARNS

	Title: 	
Vice President
	 	Title: 	
EVP

	 	
Crude Oil Marketing & Trading
	 	 	  
	 	
Suncor Energy Marketing Inc.
	 	 	  

 

  

  

  

SCHEDULE A

Amendments to ConocoPhillips General Provisions for Domestic Crude Oil Agreements

ConocoPhillips General Provisions for Domestic Crude Oil Agreements dated January 1,1993 are amended as follows:

	
F.
	
Payment

The last paragraph shall be deleted in its entirety and replaced with the following:

"In the event that Buyer fails to make any payment when due, Seller shall have the right to charge interest on the amount of the overdue payment at per annum rate which shall be two percentage points higher than the prime lending rate as may be published in The Wall Street Journal under "Money Rates" on the date payment was due, but not
to exceed the maximum rate permitted by law

If in respect of any month, amounts are due and owing, or past due and owing, under two or more agreements entered Into by the parties for the purchase, sale or exchange of crude oil and/or condensate, the parties shall net all same currency
amounts such that the party owing the greater amount shall make a single payment in each relevant currency of the net same currency amount to the other party in accordance with this Section; provided that no payment required to be made pursuant to the terms of security given pursuant to Section G, Financial Responsibility, shall be subject to netting under
this paragraph or any other provision of this Agreement. In the event that the parties have executed a separate netting agreement, the terms and conditions therein shall prevail"

	
G.
	
Financial Responsibility

The entire section shall be deleted and replaced with the following:

   "G.1.      Financial Responsibility

   If:

	
  
	
(1)
	
a party to this Agreement ("X") has reasonable grounds for insecurity regarding the other party's ("Y's") ability to perform its obligations hereunder; or

	 	
(2)
	
without limiting the circumstances of (1) above, where credit ratings exist in respect of Y or it's guarantor (where Y's obligations under this Agreement are supported by a guarantee), there has been a decrease in the rating of the unsecured, senior long-term debt of Y or it's guarantor, below BBB- by Standard & Poor's, a division of The McGraw-Hill Companies, Inc, or a successor thereto ("S&P") or below
Baa3 by Moody's Investors Services, Inc, or a successor thereto ("Moody's");

then X shall have the option of requiring security in the form of either (a) a cash prepayment, or (b) an irrevocable standby letter of credit (in form and on terms satisfactory to Seller, acting reasonably) issued by a Canadian or United States bank with a rating for its senior unsecured debt of at least A by S&P or A2 by Moody's.
Any required prepayment or letter of credit shall be in an amount specified by X, acting reasonably, and shall be provided to X within three (3) New York banking days following X's request therefore"

	 	
G.2.
	
Default

If a party to this Agreement (the "Defaulting Party") should (1) become the subject of bankruptcy or other insolvency proceedings or proceedings for the appointment of a receiver, trustee, or similar official, (2) become generally unable to pay its debts as they become due, (3)
make a general assignment for the benefit of creditors, (4) default in the payment or performance of any material obligation to the other party under this Agreement or any other associated contract and such default shall continue for two business days after notice of such default to the Defaulting Party, or (5) fail to provide satisfactory security within three New York banking days following the other party's request therefore, pursuant to Section
G 1 above, then the other party to this Agreement may withhold shipments without notice"

	
H.
	
Liquidation

Subsection (1). Right to Liquidate, is amended by deleting the words "the third paragraph of Section G, Financial Responsibility" and replacing them with "Section G 2 , Default"

	
M.
	
Governing Law

This Section is amended by deleting the word "Texas" and replacing it with the word "New York"

	
Q.
	
Assignment

The Section is amended by adding the following to the end of the Section:

"Notwithstanding the foregoing, Seller may, at any time without the consent of Buyer, transfer, sell, pledge, encumber, assign, or otherwise convey (including by declaration of trust) to a third party all or a portion of its rights or benefits herein, the accounts,
revenues, or proceeds hereof, or any security provided hereunder, in connection with any financing or other financial arrangement; provided that in making such assignment, Seller shall not be released from the performance of its obligations under this Agreement. Both parties acknowledge and agree that where benefits hereunder are assigned by Seller to a third party in accordance with the foregoing sentence, (i) the Seller may enforce benefits hereunder on its own behalf or in the name of the third party, and
(ii) the third party may directly enforce benefits hereunder on its own behalf."

  

  

  

 

GENERAL PROVISIONS

DOMESTIC CRUDE OIL AGREEMENTS

A.    Measurement and Tests: All measurements hereunder shall be made from static tank gauges on 100 percent tank table basis or by positive displacement meters All measurements and tests shall be made in accordance with the latest ASTM or ASME-API (Petroleum PD Meter Code) published
methods then in effect, whichever apply. Volume and gravity shall be adjusted to 60 degrees Fahrenheit by the use of Table 6A and 5A of the Petroleum Measurement Tables ASTM Designation D1250 in their latest revision. The crude oil delivered hereunder shall be marketable and acceptable in the applicable common of segregated stream of the
carriers involved but not to exceed 1% S&W. Full deduction for all free water and S&W content shall be made according to the API/ASTM Standard Method then in effect. Either party shall have the right to have a representative witness all gauges tests and measurements. In the absence of the other party's representative, such gauges, tests and measurements shall be deemed to be correct

B.    Warranty: The Seller warrants good title to all crude oil delivered hereunder and warrants that such crude oil shall be free from all royalties, liens, encumbrances and all applicable foreign, federal, state and
local taxes.

Seller further warrants that the crude oil delivered shall not be contaminated by chemicals foreign to virgin crude oil including, but not limited to chlorinated and/or oxygenated hydrocarbons and lead. Buyer shall have the right, without prejudice to any other remedy available to Buyer, to reject and return to Seller
any quantities of crude oil which are found to be so contaminated, even after delivery to Buyer

C.    Rules and Regulations: The terms provisions and activities undertaken pursuant to this Agreement shall be subject to all applicable laws orders and regulations of all governmental authorities.
If at any time a provision hereof violates any such applicable laws, orders or regulations, such provision shall be voided and the remainder of the Agreement shall continue in full force and effect unless terminated by either party upon giving written notice to the other parly hereto. If applicable,
the parties hereto agree to comply with all provisions (as amended) of the Equal Opportunity Clause prescribed in 41 C.F.R. 60-1.4; the Affirmative Action Clause for disabled veterans and veterans of the Vietnam Era prescribed in 41 C.F.R. 60-250 4; the Affirmative Action Clause for Handicapped
Workers prescribed in 41 C.F.R. 60-741 .4; 48 C.F.R. Chapter 1 Subpart 197 regarding Small Business and Small Disadvantaged Business Concerns; 48 C.F.R. Chapter 1 Subpart 20 3 regarding Utilization of Labor Surplus Area Concerns; Executive Order 12138 and regulations thereunder regarding subcontracts to women-owned business concerns; Affirmative Action Compliance Program (41 C.F.R. 60-1 40); annually file
SF-100 Employer Information Report (41 C.F.R. 60-1,7); 41 C.F.R. 60-1 8 prohibiting segregated facilities; and the Fair Labor Standards Act of 1938 as amended all of which are incorporated in this Agreement by reference

D.    Hazard Communication: Seller shall provide its Material Safety Data Sheet ("MSDS") to Buyer. Buyer acknowledges the hazards and risks in handling and using crude oil. Buyer shall read the MSDS and advise its employees its affiliates, and third parties, who may purchase or
come into contact with such crude oil about the hazards of crude oil, as well as the precautionary procedures for handling said crude oil which are set forth in such MSDS and any supplementary MSDS or written warning(s) which Seller may provide to Buyer from time to time.

E.     Force Majeure: Except for payment due hereunder, either party hereto shall be relieved from liability for failure to perform hereunder for the duration
and to the extent such failure is occasioned by war, riots, insurrections, fire, explosions, sabotage, strikes, and other labor or industrial disturbances, acts of God or the elements, governmental laws regulations, or requests, acts in furtherance of the
International Energy Program disruption or breakdown of production or transportation facilities, delays of pipeline carrier in receiving and delivering crude oil tendered, or by any other cause whether similar or not, reasonably beyond the control of such
party. Any such failures to perform shall be remedied with all reasonable dispatch but neither party shall be required to supply substitute quantities from other sources of supply. Failure to perform due to events of Force Majeure shall not extend the terms of this Agreement.

Notwithstanding the above, and in the event that the Agreement is an associated purchase/sale or exchange of crude oil, the parties shall have the rights and obligations described below in the circumstances described below:

(1)      If, because of Force Majeure the party declaring Force Majeure (the "Declaring Party") is unable to deliver part or all of the quantity
of crude oil which the Declaring Party Is obligated to deliver under the Agreement or associated contract, the other party (the "Exchange Partner") shall have the right but not the obligation to reduce Its deliveries of crude oil under the same Agreement or associated contract by an amount not
to exceed the number of barrels of crude oil that the Declaring Party fails to deliver.

(2)      If, because of Force Majeure the Declaring Party is unable to take delivery of part
or all of the quantity of crude oil to be delivered by the Exchange Partner under the Agreement or associated contract, the Exchange Partner shall have the right but not the obligation to reduce its receipts of crude oil under the same Agreement or associated contract by an amount not to exceed the number of barrels of crude oil
that the Declaring Party fails to take delivery of

F.     Payment: Unless otherwise specified in the Special Provisions of this Agreement, Buyer agrees to make payment against Seller's invoice tor the crude oil purchased hereunder to a bank designated by Seller in
US dollars by telegraphic transfer in immediately available funds. Unless otherwise specified in the Special Provisions of this Agreement, payment will be due on or before the 20th of the month following the month of delivery. If payment due date is on a Saturday or New York
bank holiday other than Monday, payment shall be due on the preceding New York banking day. If payment due date is on a Sunday or a Monday New York bank holiday, payment shall be due on the succeeding New York banking day.

Payment shall be deemed to be made on the date good funds are credited to Seller's account at Seller's designated bank.

In the event that Buyer fails to make any payment when due, Seller shall have the right to charge interest on the amount of the overdue payment at a per annum rate which shall be two percentage points higher than the published prime lending rate of Morgan Guaranty Trust Company of
New York on the date payment was due, but not to exceed the maximum rate permitted by law.

 

Effective January 1,1993

Supersedes November 1983 General Provisions

  

  

  

G.     Financial Responsibility: Notwithstanding anything to the contrary in this Agreement, should Seller reasonably believe it necessary to assure payment, Seller may at any time require by written notice
to Buyer, advance cash payment or satisfactory security in the form of a Letter or Letters of Credit at Buyer's expense in a form and from a bank acceptable to Seller to cover any or all deliveries of crude oil. If Buyer does not provide the Letter of Credit on or before the date specified in Sellers notice under this section, Seller or Buyer may terminate this Agreement forthwith. However, if a Letter of Credit is required under the Special Provisions of this Agreement and Buyer does not provide same, then Seller
only may terminate this Agreement forthwith. In no event shall Seller be obligated to schedule or complete delivery of the crude oil until said Letter of Credit is found acceptable to Seller. Each party may offset any payments or deliveries due to the other party under this or any other agreement between the parties.

If a party to this Agreement (the "Defaulting Party") should (1) become the subject of bankruptcy or other insolvency proceedings, or proceedings for the appointment of a receiver, trustee, or similar official, (2) become generally unable to pay its debts as they become due, or (3) make a general assignment for the benefit of creditors,
the other party to this Agreement may withold shipments without notice.

H.     Liquidation:

(1)      Right to Liquidate: At any time after the occurrence, of one or more of the events described In the third paragraph of Section G, Financial Responsibility, the other party to the Agreement (the "Liquidating Party") shall have the right, at its sole discretion, to liquidate this Agreement by terminating
this Agreement. Upon termination, the parties shall have no further rights or obligations with respect to this Agreement, except for the payment of the amount(s) (the "Settlement Amount" or "Settlement Amounts") determined as provided in Paragraph (3) of this section.

(2)      Multiple Deliveries: If this Agreement provides for multiple deliveries of one or more types of crude oil in the same or different delivery months, or for the purchase or exchange of crude oil by the parties, all deliveries under this Agreement to the same party at the same delivery location during
a particular delivery month shall be considered a single commodity transaction ("Commodity Transaction") for the purpose of determining the Settlement Amount(s). If the Liquidating Party elects to liquidate this Agreement the Liquidating Party must terminate all Commodity Transactions under this Agreement

(3)      Settlement Amount: With respect to each terminated Commodity Transaction the Settlement Amount shall be equal to the contract quantity of crude oil multiplied by the difference between the contract price per barrel specified in this
Agreement (the "Contract Price") and the market price per barrel of crude oil on the date the Liquidating Party terminates this Agreement (the "Market Price"). If the Market Price exceeds the Contract Price in a Commodity Transaction, the selling party shall pay the Settlement Amount to the buying party. If the Market Price is less than the Contract Price in a Commodity Transaction, the buying party shall pay the Settlement Amount to the selling party. If the Market Price is equal to the Contract Price in a Commodity
Transaction, no Settlement Amount shall be due.

(4)      Termination Date: For the purpose of determining the Settlement Amount, the date on which the Liquidating Party terminates this Agreement shall be deemed to be (a) the date on which the Liquidating Party sends written notice of termination
to the Defaulting Party, if such notice of termination is sent by telex or facsimile transaction; or (b) the date on which tha Defaulting Party receives written notice of termination from the Liquidating Party if such notice of termination is given by United States mail or a private mail delivery service.

(5)      Market Price: Unless otherwise provided in this Agreement, the Market Price of crude oil sold or exchanged under this Agreement shall be the price for crude oil for the delivery
month specified in this Agreement and at the delivery location that corresponds to the delivery location specified in this Agreement, as reported in Platt's Oilgram Price Report ("Platt's") for the date on which the Liquidating Party terminates this Agreement. If Platt's reports a range of prices for crude oil on that date, the Market Price shall be the
arithmetic average of the high and low prices reported by Platt's. If Platt's does not report prices for the crude oil being sold under this Agreement the Liquidating Party shall determine the Market Price of such crude oil in a commercially reasonable manner, unless otherwise provided in this Agreement.

(6)      Payment of Settlement Amount: Any Settlement Amount due upon termination of this Agreement Shall be paid in immediately available funds within two business days after the Liquidating Party terminates this Agreement. However if this
Agreement provides for more than one Commodity Transaction or if Settlement Amounts are due under other agreements terminated by the Liquidating Party the Settlement Amounts due to each party for such Commodity Transactions and/or agreements shall be aggregated. The party owing the net amount after such aggregation shall pay such net amount to the other party in immediately available funds within two business days after the date on which the Liquidating Party terminates the Agreement.

(7)      Miscellaneous: This section shall not limit the rights and remedies available to the Liquidating Party by law or under other provisions of this Agreement. The parties hereby acknowledge that this Agreement constitutes a forward contract
for purposes of Section 536 of the U S. Bankruptcy Code.

I.      Equal Daily Deliveries: For pricing purposes only, unless otherwise specified in the Special Provisions, all crude oil delivered hereunder during any calendar month shall be considered to
have been delivered in equal daily quantities during such month

J.      Exchange Balancing: If volumes are exchanged each party shall be responsible for maintaining the exchange in balance on a month-to-month basis as near as pipeline or other transportation conditions
will permit. In all events upon termination of this Agreement and after all monetary obligations under this Agreement have been satisfied any volume imbalance existing at the conclusion of this Agreement of less than 1,000 barrels will be declared in balance. Any volume imbalance of 1,000 barrels or more limited to the total contract volume, will be settled by the underdelivering party making delivery of the total
volume imbalance in accordance with the delivery provisions of this Agreement applicable to the underdelivering party unless mutually agreed to the contrary. The request to schedule all volume imbalances must be confirmed in writing by one party or both parties. Volume imbalances confirmed by the 20th of the month shall be delivered during the calender month after the volume imbalance is confirmed.
Volume imbalances confirmed after the 20th of the month shall be delivered during the second calendar month after the volume imbalance is confirmed.

 

Effective January 1, 1993

Supersedes November 1983 General Provisions

  

  

  

K.    Delivery, Title, and Risk of Loss; Delivery, title, and risk of loss of the crude oil delivered hereunder shall pass from Seller to Buyer as follows:

For lease delivery locations, delivery of the crude oil to the Buyer shall he effected as the crude oil passes the last permanent delivery flange and/or meter connecting the Seller's lease/unit storage tanks or processing facilities to the Buyer's carrier. Title to and risk of loss of the crude oil shall pass from Seller to Buyer at the
point of delivery.

For delivery locations other than lease/unit delivery locations delivery of the crude oil to the Buyer shall be effected as the crude oil passes the last permanent delivery flange and/or meter connecting the delivery facility designated by the Seller to the Buyers carrier. If delivery's by in-line transfer, delivery of the crude oil to
the Buyer shall be effected at the particular pipeline facility designated in this Agreement Title to and risk of loss of the crude oil shall pass from the Seller to the Buyer upon delivery.

L.    Term: Unless otherwise specified in the Special Provisions delivery months begin at 7:00 a.m. on the first day of the calendar month and end at 7:00 a.m on the first day of the following calendar month.

M.   Governing Law: This Agreement and any disputes arising hereunder shall be governed by the laws of the State of Texas.

N.    Necessary Documents: Upon request each party agrees to furnish all substantiating documents incident to the transaction including a Delivery Ticket for each volume delivered and an invoice for any month
in which the sums are due.

O.    Waiver: No waiver by either party regarding the performance of the other party under any of the provisions of this Agreement shall be construed
as a waiver of any subsequent performance under the same or any other provisions.

P.    Assignment: Neither party shall assign this Agreement or any rights hereunder without the written consent of the other party unless such assignment is made to a person controlling, controlled by or under
common control of assignor, in which event assignor shall remain responsible for nonperformance.

 

Q.   Entirety of Agreement: The Special Previsions and these General Provisions contain the entire Agreement of the parties; there are no other promises representations or warranties. Any modification of this Agreement shall be by written instrument. Any conflict between the Special
Provisions and these General Provisions shall be resolved in favor of the Special Provisions. The section headings are for convenience only and shall not limit or change the subject matter of this Agreement.

R.    Definitions: When used in this Agreement, the terms listed below have the following meanings:

"API" means the American Petroleum Institute

"ASME" means the American Society of Mechanical Engineers

"ASTM" means the American Society for Testing Materials.

"Barrel" means 42 U.S., gallons of 231 cubic inches per gallon corrected to 60 degrees Fahrenheit

"Carrier" means a pipeline barge truck or other suitable transporter of crude oil

"Crude Oil" means crude oil or condensate, as appropriate

"Day", "month," and "year" mean, respectively calendar day calendar month, and calendar year unless otherwise specified

"Delivery Ticket" means a shipping/loading document or documents stating the type and quality of crude oil delivered the volume delivered and method of measurement the corrected specifc gravity temperature and S&W content

"Invoice" means a statement setting forth all least the following information: The date(s) of delivery under the transaction; the location(s) of delivery; the volume(s); price(s); the specific gravity and gravity adjustments to the price(s) (where applicable); and the term(s) of payment

"S&W" means sediment and water

 

Effective January 1,1993

Supersedes November 1983 General ProvisionsMANAGEMENT
SERVICES AGREEMENT

    

    This
Management Agreement (“Agreement”) is made and entered into as of this 20th day
of March, 2009, by and between Apollo Medical Management, Inc., a Delaware
corporation (“Manager”), and ApolloMed Hospitalists, a California medical
corporation (“Group”).

     

    Recitals:

     

    A.    
       Manager is a Delaware corporation
engaged in the business of managing physician practices to enhance the quality
and efficiency of the medical practices it manages.

     

    B.            Group
is a California medical corporation that provides hospitalist services to
inpatients at hospitals staffed by Group.

     

    C.         
  Group desires retain Manager to provide assistance to Group in
managing and administering all non-medical aspects of Group’s medical practice
in a manner and to the extent permitted by law.

     

    D.          
 Group and Manager recognize that Group has sole responsibility for
providing medical services to Group’s patients, and Manager shall provide
assistance to Group in managing and administering all non-medical functions of
Group’s medical practice.

     

    THEREFORE,
in consideration of the mutual covenants and agreements contained herein, the
parties agree as follows:

     

    1.           
Management
Services.  During the term of this Agreement, Group engages
Manager to assist Group in providing the following management and administrative
services required by Group for the operation of the Practice:

     

    (a)           Business
Matters.  Supervising and coordinating all day-to-day,
non-medical business aspects of Group’s Practice.

     

    (b)           Supplies and
Equipment.  Ordering and purchasing, after consultation with
Group, all medical and office supplies and equipment required by Group in
connection with the operation of Group’s practice.  All such supplies
shall be of a quality acceptable to Group.

     

    (c)           Bookkeeping.  Providing
all bookkeeping and accounting services, including, without limitation,
maintenance, custody and supervision of Group’s business records, papers and
documents, ledgers, journals and reports, and the preparation, distribution and
recording of all bills and statements for professional services rendered by
Group in the course of Group’s Practice.

     

    
      
        
        

      

      
        -1-

        
          

        

      

      
        
        

      

    

     

    (d)           Management & Clinical
Information Systems.  Upon request and in consultation with
Group, the planning, negotiation with third party vendors, selection,
installation and operation of appropriate hardware and software (including but
not limited to the Apollo Web database technology) to provide Group with
management and clinical information systems support.  All clinical and
financial data pertaining to Group’s practice shall be regularly backed up on
electronic media, with additional hard copy back up when in the judgment of
Manager, after consultation with Group, it is prudent to do so, and copies of
such back up data in both electronic media and hard copy shall be provided to
Group from time to time upon request of Group.  Upon termination of
this Agreement for any reason, all such data and back up data shall be promptly
delivered to Group to ensure continuity of Group’s financial and clinical
operations.  All such services shall comply, as appropriate, with the
Health Insurance Portability and Accountability Act of 1996, and the regulations
promulgated thereto (“HIPAA”).

     

    (e)           Billing &
Collection.  Subject to Section 3(d) below, providing all
billing and collection services for Group’s medical practice.  All
billings shall be accurate and in accord with appropriate and up-to-date payor
coding requirements.  Manager shall diligently pursue collections of
Group and shall follow up billings in a timely fashion to ensure that payments
are received to the greatest extent possible in a commercially reasonable time,
and that aged accounts receivable are maintained within commercially reasonable
limits, for medical practices similar to that of Group.

     

    (i)  Attorney-In-Fact; Assignment
and Limitations.  In performing its billing and collection
duties hereunder, Manager shall act as Group’s agent and shall indicate it is
billing in the name of Group.  Group hereby appoints Manager, for the
term hereof, as its true and lawful attorney-in-fact, with full power of
assignment and substitution, to bill patients or third party payors on Group’s
behalf; collect accounts receivable arising out of billings, and receive
payments on behalf of Group.  Notwithstanding the foregoing, no
assignment shall be made to Manager of any sums or rights to payment, the
assignment of which is prohibited by law (e.g., revenues from patients covered
by the Medicare program).  In lieu of assignment of such payments,
unless otherwise prohibited by law, Group shall remit to Manager the amount of
any such sums within five (5) business days of Group’s receipt
thereof.  Group and Manager shall cooperate in the establishment of a
separate account or accounts to track all such amounts.  In connection
with its billing activities, Manager may take possession of, and endorse in the
name of Group, any and all notes, drafts and other instruments received by way
of payment.  Manager shall assist Group in negotiating or otherwise
communicating with any patient or third party payor regarding claims processing
and any disputes arising therefrom.

     

    (ii)           Bank
Accounts.  Manager is hereby granted a general power of
attorney with respect to the bank accounts of Group and shall have full access
to and signatory rights, with Group, over such bank accounts.  Manager
shall have full power and authority to deposit funds into, and withdraw funds
from, all such accounts in accordance with the terms of this Agreement;
provided, however, that Group may impose such limitations upon Manager’s
signatory rights over such accounts as Group shall determine from time to time,
in Group’s sole discretion.  Manager shall have full authority to
receive and transact on behalf of Group all cash, checks, drafts, notes and
other instruments tendered as payment for professional services rendered by
Group, except as may be precluded by law.

     

    
      
        
        

      

      
        -2-

        
          

        

      

      
        
        

      

    

     

    (f)       
    UR/QA.  Assisting
Group in the establishment and implementation of a program or programs of
utilization review and quality assurance for the activities of Group, and in the
formulation and implementation of related policies, procedures and protocols
including, but not limited to both a monitoring function and the development and
implementation of performance parameters, evidence based medicine protocols, and
outcomes measurements

     

    (g)           Insurance.  Negotiating
and securing appropriate insurance coverage on behalf of Group and in connection
with Group’s Practice, after consultation with Group, including coverage for
malpractice, comprehensive general liability, fire and premises liability,
worker’s compensation, business interruption, and such other coverage as may be
agreed from time to time between Manager and Group.

     

    (h)           Worker’s Compensation,
Etc.  Preparing and filing all forms, reports, and returns
required by law in connection with unemployment insurance, workers’ compensation
insurance, disability benefits, social security, and other similar laws now in
effect or hereafter imposed.

     

    (i)      
     Premises.  Managing
the proper maintenance and physical operation of Group’s medical practice
premises (“Premises”).  Group’s medical office lease(s) are listed on
Exhibit A, which is attached hereto and made a part hereof.

     

    (j)         
  Clerical
Support.  Providing reception, secretarial, human resources,
transcription and clerical personnel and services, including management of the
maintenance of medical records.  All Manager personnel shall be
acceptable to Group in its reasonable discretion and shall be appropriately
trained and supervised for the duties assigned to them in connection with
Group’s practice.

     

    (k)           Advertising.  Marketing
of physician services to hospitals, and otherwise coordinating advertising,
marketing and similar activities conducted on behalf of Group, after
consultation with Group.

     

    (l)     
      Capital.  Consulting
with Group regarding capital and financial needs, including seeking capital,
undertaking the efforts to raise, and providing access to, capital for any
lawful purpose, including without limitation working capital, acquiring other
physician practices and acquiring other business assets of the
practice.

     

    (m)           Contracting.  Manager
shall assist Group in setting the parameters under which Group will enter into,
and in negotiating, contractual relations with hospitals and third party
payors.

     

    
      
        
        

      

      
        -3-

        
          

        

      

      
        
        

      

    

     

    (n)           Other
Services.  Providing such other services as may be agreed
between the parties from time to time which may include, but not be limited to,
Physician recruitment services, contracting services (with hospitals and
payors), physicians scheduling, Payroll services for the physicians (as well as
management company personnel), Case management for patients

     

    2.            Performance
of Manager’s Services.

     

    (a)           Manager’s
Availability.  Manager shall devote its best efforts to
carrying out the terms of this Agreement and shall devote sufficient time and
resources, as determined by Manager after consultation with Group, as is
reasonably required to discharge its duties under this Agreement.

     

    (b)           Manager’s
Authority.  Manager shall perform all additional and ancillary
services, not otherwise described in this Agreement, that may in Manager’s
judgment, after consultation with Group, be reasonable and appropriate in order
to meet Manager’s obligations under this Agreement.  Manager may
subcontract with other persons or entities, including entities related to
Manager by common ownership or control, to perform all or any part of the
services required of Manager by this Agreement.  For purposes of this
Agreement, Manager shall have signatory rights on all bank accounts used by
Group in the conduct of Group’s Practice, and Manager shall have the right to
make deposits to and payments from such accounts as it deems appropriate in
furtherance of its obligations hereunder, in accordance with Paragraph 1(e)(ii)
(Bank Accounts).

     

    (c)           Manager’s
Responsibility.  In all matters under this Agreement, Manager
shall abide by all applicable state and federal laws and regulations, and
applicable policies and procedures of Group.

     

    (d)           Reports to
Group.  On or before the twenty-fifth (25th) day of
the first month of each calendar quarter, Manager shall provide Group with an
accounting of all billings and collections on behalf of Group, and all deposits
to the account(s) of Group and payments from the account(s) of Group, effected
by Manager for the benefit of Group during the immediately preceding calendar
quarter.  All reports shall be in such form as may be agreed between
Manager and Group from time to time.

     

    3.        
   Obligations of Group.

     

    (a)           Designation of
Agent.  Group hereby designates and appoints Manager
to act as Group’s non-physician manager and to provide the services to
Group in connection with Group’s Practice as described in this
Agreement.  Group hereby designates Warren Hosseinion, M.D. as its
designated representative who is duly authorized by the Group to bind the Group
and act on behalf of the Group in all respects pertaining to this
Agreement.

     

    
      
        
        

      

      
        -4-

        
          

        

      

      
        
        

      

    

     

    (b)           Access to
Information.  Group acknowledges and agrees that all
information and records concerning Group and Group’s performance of services
that may be obtained by Manager during the term of this Agreement may be used by
Manager for all purposes necessary or convenient to Manager’s obligations under
this Agreement.

     

    (c)           Selection of Group
Personnel.  Group shall retain responsibility for the
selection, hiring and termination of physicians, allied health professionals and
medical assistants working in clinical capacities for the
Group.  Group, in consultation with Manager, shall be solely
responsible for determining the compensation of all licensed medical
professionals.

     

    (d)           Coding and Billing
Procedures.  Group shall retain responsibility for decisions
relating to coding and billing procedure for patient care services.

     

    4.     
      Confidentiality.

     

    (a)           Trade
Secrets.  All proceedings, files, records and related
information of Group and of Manager are confidential and proprietary information
of Group and Manager, respectively, and each party shall keep and maintain as
strictly confidential all such information to which it may have access by virtue
of this Agreement.  Neither party shall voluntarily disclose all or
any part of such confidential information, orally or in writing, except as
expressly required by law or pursuant to a written authorization from the other
party.  Each party shall include the provisions of this Paragraph in
any written contract with any employed or contracted persons that may be engaged
by such party to render services pursuant to this Agreement, and shall take such
other steps as may be reasonable under the circumstances to ensure that its
respective personnel do not disclose any confidential information in violation
of this provision.  This covenant shall survive the termination of
this Agreement.  Each party agrees that upon termination of this
Agreement for any reason, it shall promptly return to the other party the
originals and all copies of any and all trade secrets, confidential or
proprietary information, it may then possess, including without limitation any
such information stored on computer media.

     

    (b)           Medical Information &
Patient Records.  Each party shall maintain the confidentiality
of all patient records, charts and other patient identifying information, and
shall comply with all applicable State and Federal laws governing the
confidentiality of medical records and related information.  Manager
will serve as a “Business Associate” (as that term is defined under HIPAA) of
Group, Accordingly, and in compliance with the requirements HIPAA, Manager
shall, prior to the commencement of services hereunder, enter into a mutually
acceptable form of Business Associate Agreement.

     

    
      
        
        

      

      
        -5-

        
          

        

      

      
        
        

      

    

     

    (c)           Intellectual Property
Rights.  Group utilizes a proprietary database technology
called ApolloWeb to enhance the quality and efficiency of the medical practices
it manages. (“ApolloWeb”).  From time to time, Group may provide
Manager with software programs and related documentation, or improvements and
upgrades thereto, to facilitate its use of ApolloWeb (“System-Related
Software”).  Group hereby grants Manager a nonexclusive, royalty-free
license to reproduce, install and use on equipment owned or controlled by Group,
and solely for Group’s own purposes (which may be business or non-commercial, as
applicable), any such System-Related Software only in the form it was provided
or made available to Manager by Group, and only in connection with Manager’s use
of the ApolloWeb in accordance with this Agreement.  Manager will not
distribute, sublicense, modify, create derivative works of, sell, transfer or
assign the System-Related Software, nor will Manager reverse engineer, decompile
or disassemble any object code of System-Related Software except to the extent
permitted by applicable law notwithstanding this restriction.  Manager
further agrees not to remove or destroy any proprietary markings or confidential
legends placed upon or contained within any System-Related
Software.

     

    Group and
its licensors reserve all right, title and interest in the  ApolloWeb
and System-Related Software, including all intellectual property rights therein
(including without limitation all copyrights, patents, trade secrets,
trademarks, service marks and trade names) subject to the licenses expressly set
forth in this Agreement.  This Agreement does not include any sale or
transfer to Manager of Group intellectual property rights, including without
limitation with respect to ApolloWeb or any System-Related
Software.

     

    Manager
acknowledges that the content, data and other materials made available by Group
are owned or licensed by Group (the “Third Party Materials”).  Manager
will not reproduce, distribute, modify, create derivative works of, or exercise
any other rights in, such third party materials except as authorized by
Group.

     

    5.       
    Independent Contractors.

     

    In the
performance of services under this Agreement, it is mutually understood and
agreed that Manager is at all times acting and performing as an independent
contractor rendering administrative services to Group.  Neither party
shall have any claim against the other under this Agreement or otherwise for
Workers’ Compensation, unemployment compensation, vacation pay, sick leave,
retirement benefits, Social Security benefits, disability insurance benefits,
unemployment insurance benefits, or any other benefits.

     

    6.     
      Staffing of Manager and Group.

     

    (a)           Non-physician
Personnel.  Manager shall be responsible for the payment to all
persons employed or retained by Manager of all compensation, including
reasonable base salary, fringe benefits, bonuses, health and disability
insurance, workers’ compensation insurance and any other benefits that Manager
may make available to its employees or contractors.

     

    
      
        
        

      

      
        -6-

        
          

        

      

      
        
        

      

    

     

    (b)           Licensed Professional
Personnel.  Group shall employ or contract with all physicians
and other licensed professional personnel that Group, after consultation with
Manager, deems to be required for the conduct of the Practice.  All
such personnel shall be employees or contractors of Group, and Group shall be
responsible for the payment to all such persons of all compensation, including
reasonable base salary, fringe benefits, bonuses, health and disability
insurance, workers’ compensation insurance and any other benefits which Group
may make available to Group’s employees or contractors; provided, however, that
Manager shall have management responsibility over the non-medical aspects
associated with Group’s employment or contracting of such
personnel.

     

    7.            Term
and Termination.

     

    (a)           Term.  This
Agreement shall commence on August 1, 2008 and shall continue in full force and
effect for a term of twenty (20) years (the “Term”) until terminated as provided
in this Agreement.

     

    (b)           No Termination without
Cause.  This Agreement may be terminated only for cause as
specified in Subparagraph (c) below.

     

    (c)           Termination For
Cause.  This Agreement may be terminated by either party for
cause, upon sixty (60) days prior written notice to the other party specifying
the cause upon which such termination is based.  For purposes of this
Agreement, “cause” shall have the meanings set forth
below.  Notwithstanding the foregoing, neither party may terminate
this Agreement if, during the foregoing sixty (60) day period, the party to whom
notice has been given successfully cures the failure or breach of performance
upon which termination is based; provided, however, that if such failure or
breach cannot be cured within the sixty (60) day period, termination shall not
occur if the party to whom notice has been given takes material action during
such sixty (60) day period to cure the failure or breach and thereafter
diligently and continuously prosecutes such cure to completion.

     

    (d)           By
Group.  Cause for termination by Group shall be limited to the
following: (i) failure of any representation or warranty made by Manager in
this Agreement to be true at the date of this Agreement and to remain true
throughout the Term hereof, which failure has a material adverse effect upon
Group; (ii) material failure by Manager to duly observe and perform the
covenants and agreements undertaken by Manager herein;
(iii) misrepresentation of material fact, or fraud, by Manager in the
discharge of its obligations under this Agreement; (iv) if Manager shall
dissolve, shall be adjudicated insolvent or bankrupt, or shall make a general
assignment for the benefit of creditors, or shall consent to or authorize the
filing of a voluntary petition in bankruptcy, which petition shall remain
undismissed for a period of sixty (60) days, or the filing against Manager of
any proceeding in involuntary bankruptcy, which proceeding shall remain
undismissed for a period of sixty (60) days.

     

    
      
        
        

      

      
        -7-

        
          

        

      

      
        
        

      

    

     

    (e)           By
Manager.  Cause for termination by Manager shall be limited to
the following: (i) failure of any representation or warranty made by Group
in this Agreement to be true at the date of this Agreement and to remain true
throughout the Term hereof, which failure has a material adverse effect upon
Manager; (ii) material failure by Group to duly observe and perform all the
covenants and agreements undertaken by Group herein;
(iii) misrepresentation of material fact, or fraud, by Group in the
discharge of Group’s obligations under this Agreement; or (iv) if Group
shall be adjudicated insolvent or bankrupt, or shall make a general assignment
for the benefit of creditors, or shall consent to or authorize the filing of a
voluntary petition in bankruptcy, which petition shall remain undismissed for a
period of sixty (60) days, or the filing against Group of any proceeding in
involuntary bankruptcy, which proceeding shall remain undismissed for a period
of sixty (60) days.

     

    (f)           Effect of
Termination.  Termination of this Agreement shall not discharge
either party from any obligation which may have arisen and which remains to be
performed upon the date of termination, including, but not limited to, the
obligation to compensate Manager in accordance with Section 8 (Management
Fee).  Upon termination of this Agreement, Manager shall promptly
deliver to Group all clinical and financial data maintained by Manager for
Group’s benefit.  Manager shall make diligent efforts to collect
receivables arising from services of Group prior to the date of termination and
shall remit to Group in a timely fashion the allocable portion of all such
collections.  Similarly, following termination, all receivables that
Group may directly collect arising from services of Group prior to the date of
termination shall be allocated as provided herein, and Group shall remit to
Manager in a timely fashion the allocable portion of Group’s collections of the
same.

     

    8.            Management
Fee.

     

    (a)           In
consideration of the management services to be rendered by Manager hereunder,
Group shall pay Manager, each month, a percentage of Group’s gross revenue that
Group receives for the performance of medical services by Group.  This
percentage will be amended or modified each month, according to medical practice
budgets agreed between Manager and Group.

     

    (b)           On
or before the twentieth (20th) day of the month following each month, Manager
may deduct and pay to itself, from any account(s) of Group managed by Manager,
all amounts due and owing to Manager as management fees for the immediately
preceding month.

     

    9.            Rights
of Entry and Inspection.

     

    (a)           By
Manager.  Manager and its duly authorized representatives shall
have the right at all reasonable times to enter upon Group’s Premises for the
purposes of carrying out the duties of Manager hereunder, and for inspection and
verification of Group’s books and records pertaining to Group’s Practice;
provided, however, that any such entry by Manager shall not unreasonably
interfere with the conduct of Group’s Practice.

     

    
      
        
        

      

      
        -8-

        
          

        

      

      
        
        

      

    

     

    (b)           By
Group.  Group and its duly authorized representatives shall
have the right at all reasonable times to enter upon Manager’s premises for the
purposes of carrying out the duties of Group hereunder, and for inspection and
verification of Manager’s books and records pertaining to Group’s Practice;
provided, however, that any such entry by Group shall not unreasonably interfere
with the conduct of Manager’s business.

     

    10.          Group’s
Representations and Warranties.

     

    (a)           Properly
Constituted.  Group is a professional corporation, duly
organized, existing in good standing under the laws of the State of California,
has the corporate power and authority to own its property and to carry on
Group’s business as it is now being conducted, and to enter into and perform
Group’s obligations under this Agreement.

     

    (b)           No
Conflicts.  The execution, delivery and performance of this
Agreement will not contravene or conflict with any agreements, indentures or
contracts to which Group is a party or by which it is bound.

     

    (c)           Licenses and
Permits.  Group has in full force and effect all licenses,
permits and certificates required to operate Group’s Practice as it is being
operated as of the date of this Agreement.  Group shall promptly
notify Manager should any of Group’s shareholders become ineligible to practice
medicine in the State of California.  Group shall not permit any
persons who have become ineligible to practice medicine in California to retain
shares of Group beyond such time periods as may be permitted by
law.

     

    (d)           Consents.  Group
has taken all appropriate corporate action and has obtained all necessary
approvals and consents that are necessary or convenient to enable Group to enter
into this Agreement.

     

    11.          Manager’s
Representations and Warranties.

     

    (a)           Properly
Constituted.  Manager is a corporation duly organized, existing
and in good standing under the laws of the State of Delaware, has the corporate
power and authority to own its property and to carry on its business as it is
now being conducted, and to enter into and perform its obligations under this
Agreement.

     

    (b)           No
Conflicts.  The execution, delivery and performance of this
Agreement will not contravene or conflict with any agreements, indentures or
contracts to which Manager is a party or by which it is bound.

     

    
      
        
        

      

      
        -9-

        
          

        

      

      
        
        

      

    

     

    (c)           Licenses and
Permits.  Manager has in full force and effect all licenses,
permits and certificates required to operate its business as it is being
operated as of the date of this Agreement.

     

    (d)           Consents.  Manager
has taken all appropriate corporate action and has obtained all necessary
approvals and consents that are necessary or convenient to enable Manager to
enter into this Agreement.

     

    12.          Insurance
and Indemnity.

     

    (a)           Professional
Liability.  Group shall at all times during the term of the
Agreement procure and maintain, and cause all licensed health care personnel
associated with Group’s medical practice to similarly procure and maintain,
professional liability insurance with minimum coverage limits of One Million
Dollars ($1,000,000) per occurrence and Three Million Dollars ($3,000,000)
annual aggregate, and in such form and substance, and underwritten by such
recognized companies, authorized to do business in California, as Manager may
from time to time reasonably require, and shall provide copies of all such
policies and renewals thereof to Manager upon request.

     

    (b)           Indemnity.  To
the extent permissible under each party’s respective policies of insurance, each
party shall indemnify and hold harmless the other party, and its shareholders,
directors, officers, employees and agents, from and against all damages, costs,
expenses, liabilities, claims, demands, and judgments of whatever kind or
nature, including reasonable attorneys’ fees and costs, for which either party
might liable, in whole or in part, arising out of or related to the acts and/or
omissions of the indemnifying party and its shareholders, directors, officers
employees and agents.

     

    13.          General
Provisions.

     

    (a)           Assignment.  Neither
party shall assign any of its rights nor delegate any of its duties or
obligations under this Agreement without the prior written consent of the other
party.  Notwithstanding the foregoing, Manager may assign this
Agreement to a successor in interest by providing notice to Group, which notice
shall state the effective date of such assignment.  Upon such
assignment, the successor shall be responsible for the duties and
responsibilities of Manager hereunder.  Nothing contained in this
Agreement shall be construed to prevent the Manager from selling or conveying
substantially all of its assets used in connection with the performance of this
Agreement, nor shall Group be prohibited from selling or conveying substantially
all of its assets provided that the Agreement continues in full force and
effect.

     

    (b)           Access to Books and
Records.  Manager shall make available, upon request, to the
Secretary of Health and Human Services and the Comptroller General of the United
States, or their authorized representatives, this Agreement, and all books,
documents and records relating to the nature and extent of the costs of services
provided hereunder for a period of five (5) years after the furnishing of
services pursuant hereto.  In addition, if Manager’s services under
this Agreement are to be provided by subcontract and if that subcontract has a
value or cost of Ten Thousand Dollars ($10,000.00) or more over a twelve-month
period, Manager shall require in writing that the subcontractor make available
to the Secretary and the Comptroller General, or their authorized
representatives, for a period of five (5) years after the furnishing of such
services, the subcontract and all books, documents and records relating to the
nature and extent of the costs of the services provided thereunder.

     

    
      
        
        

      

      
        -10-

        
          

        

      

      
        
        

      

    

     

    (c)           Amendments.  This
Agreement may be amended at any time by mutual agreement of the parties without
additional consideration, provided that before any amendment shall become
effective, it shall be reduced to writing and signed by the
parties.  Notwithstanding the foregoing, should any provision of this
Agreement be in conflict with a governing State or federal law, it shall be
deemed amended accordingly.

     

    (d)           Notices.  Notices
required under this Agreement shall be deemed given (i) at the time of personal
delivery upon the party to be served; or (ii) twenty four (24) hours following
deposit for overnight delivery with a bonded courier holding itself out to the
public as providing such service, or following deposit in the U.S. Mail, Express
Mail for overnight delivery; or (iii) forty eight (48) hours following deposit
in the U.S. Mail, registered or certified mail; and in any case postage prepaid
and addressed as follows, or to such other addresses as either party may from
time to time designate to the other:

     

    
      	
            	
              To
      Group: 

            	
              ApolloMed
      Hospitalists

            

    

     

    P.O. Box
4555

           Glendale,
CA 91222

    

    
      	
            	
              To
      Manager:

            	
              Apollo
      Medical Management, Inc.

            

    

     

     1010
N. Central Ave.

    Glendale,
CA 91201

     

    (e)           Entire
Agreement.  This Agreement, including all Attachments, is the
entire Agreement between the parties regarding the subject matter hereof, and
supersedes all other and prior agreements, whether oral or written.

     

    (f)           Successors and
Assigns.  This Agreement shall inure to the benefit of, and
shall be binding upon, the parties hereto and their permitted successors and
assigns.

     

    (g)           Waiver of
Provisions.  No waiver of any terms or conditions hereof shall
be valid unless given in writing, and signed by the party giving such
waiver.  A waiver of any term or condition hereof shall not be
construed as a future or continuing waiver of the same or any other term or
condition hereof.

     

    
      
        
        

      

      
        -11-

        
          

        

      

      
        
        

      

    

     

    (h)           Governing
Law.  This Agreement shall be construed in accordance with and
governed by the laws of the State of California without regard to conflicts of
law.

     

    (i)           
Severability.  The
provisions of this Agreement shall be deemed severable, and if any portion shall
be held invalid, illegal or unenforceable for any reason, the remainder of this
Agreement shall be effective and binding upon the parties.

     

    (j)           Attorneys’
Fees.  In the event that any action, including mediation or
arbitration, is brought by either party arising out of or in connection with
this Agreement, the prevailing party in such action shall be entitled to recover
its costs of suit, including reasonable attorneys’ fees.

     

    (k)           Captions.  Any
captions to or headings of the articles, sections, subsections, paragraphs, or
subparagraphs of this Agreement are solely for the convenience of the parties,
are not a part of this Agreement, and shall not be used for the interpretation
or determination of any provision hereof.

     

    (l)           
Cumulation of
Remedies.  The various rights, options, elections, powers, and
remedies of the respective parties hereto granted by this Agreement are in
addition to any others to which the parties may be entitled to by law, shall be
construed as cumulative, and no one of them is exclusive of any of the others,
or of any right of priority allowed by law.

     

    (m)         
No Third Party
Rights.  The parties do not intend the benefits of this
Agreement to inure to any third person not a signatory hereto; and accordingly,
this Agreement shall not be construed to create any right, claim or cause of
action against either party by any person or entity not a party
hereto.

     

    (n)           Construction of
Agreement.  The parties agree that each party and its counsel
have participated in the review and revision of this Agreement and that any rule
of construction to the effect that ambiguities are to be resolved against the
drafting party shall not apply in the interpretation of this
Agreement.

     

    (o)           Counterparts.  This
Agreement may be executed in any number of counterparts, each of which shall be
deemed an original, but all of which together shall constitute one and the same
instrument.

     

    
      
        
        

      

      
        -12-

        
          

        

      

      
        
        

      

    

     

    IN
WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date
first above written.

    

    
      
        
          
            
              
                
                  	
                          Apollo
      Medical Management, Inc.

                        
	
                          (“MANAGER”):

                        
	 
      	 
      
	
                          By:

                        	
                          /s/
      Warren Hosseinion

                        
	 
      	 
      
	
                          Its:

                        	
                          Chief
      Executive Officer

                        
	 
      	 
      
	
                          Apollo
      Med Hospitalists, a Medical Corporation

                        
	
                          (“GROUP”):

                        
	 
      	 
      
	
                          By:

                        	
                          /s/
      Warren Hosseinion

                        
	 
      	 
      
	
                          Its:

                        	
                          Chief
      Executive
Officer

                        

                

              

            

          

        

      

    

     

    
      
         

      

      
        -13-

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00159-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00159-of-00352.parquet"}]]