<TABLE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) October 31, 1995
Medcross, Inc.
(Exact name of registrant as specified in its charter)
Florida 0-17973 59-2291344
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
3227 Bennet Street North, St. Petersburg, Florida 33713
(Address of principal executive offices) (Zip code)
Registrant's telephone number, including area code (813) 521-1793
(Former name or former address, if changed since last report.)
<PAGE>
Item 5. Other Events
The Company entered into a consulting agreement for the three month period
ended October 23, 1995 with Bijan Taghavi, formerly an officer and director of
the Company. Pursuant to such agreement, Mr. Taghavi was engaged to provide
such consulting services as requested by the Company in exchange for
compensation at the rate of $5,208 per month. Mr. Taghavi's consulting
agreement contains certain mutual release, non-competition, and
confidentiality provisions.
The Company entered into a consulting agreement with Timothy R. Barnes,
formerly an officer of the Company (the "Barnes Agreement") effective as of
August 6, 1995 pursuant to which Mr. Barnes has agreed to provide consulting
services as requested by the Company's President. Such agreement is for a
term expiring February 6, 1996 and provides for the issuance to Mr. Barnes of
warrants to purchase 36,858 shares of Common Stock exercisable at a purchase
price of $1.00 per share. The Barnes Agreement also contains standard non-
competition and confidentiality provisions.
The Company has also entered into two consulting agreements with Jason H.
Pollak, the initial term of one of which is to expire on January 31, 1996 and
the second of such agreements commences thereafter for a period of three years
(the "Pollak Agreement") pursuant to which Mr. Pollak has agreed to provide
investor and public relations services. Pursuant to the terms of the first of
the Pollak Agreements, Mr. Pollak has received 50,000 shares of Common Stock.
The second of the Pollak Agreements provides that the Company shall issue to
Mr. Pollak an option to purchase up to 150,000 shares of Common Stock.
Options to purchase 50,000 shares are exercisable each year commencing
February 1, 1996 at prices per share of $1.50, $2.50, and $3.50, respectively.
The shares of Common Stock subject to the Barnes Agreement and the first of
the Pollak Agreements have been included in registration statements on Form S-
8 recently filed by the Company with the Commission (Registration Nos. 33-
63751 and 33-63749, respectively) and the Company has agreed to register the
securities issuable in accordance with the second of the Pollak Agreements as
soon as practicable.
On December 5, 1995, Medcross Imaging, Ltd., a subsidiary of the Company,
entered into MR Service Agreements dated October 1, 1995, with two major
customers, South Bay Hospital and Edward White Hospital relating to the
provisions of mobile magnetic resonance imaging service to such hospitals.
The agreements are substantially similar to prior agreements with such
customers with a change in the minimum arrangement whereas the hospitals are
billed on a monthly basis for the greater of the minimum charges or the
charges for the actual patients treated. The agreements respectively provide
for a reduction in per patient charges of approximately 30% compared to the
prior agreements, and that both of the agreements are for seventeen month
periods from October 1, 1995 whereas the prior agreements were to expire on
February 1, 1996. The agreements are both renewable automatically for
additional one-year terms unless written notice is given at least 90 days
prior to the end of the term.
<PAGE>
The above descriptions of the MR Service Agreements entered into by the
Company's subsidiary are not complete. Reference is made to the respective
agreements executed by Medcross Imaging, Ltd., copies of which are filed as
exhibits to this report and incorporated herein by reference.
Item 7. Exhibits
(10)(a) MR Service Agreement effective October 1, 1995 by and between
Medcross Imaging, Ltd. and South Bay Hospital.
(b) MR Service Agreement effective October 1, 1995 by and between
Medcross Imaging, Ltd. and Edward White Hospital.
(c) Consulting Agreement effective October 18, 1995 by and among
Medcross, Inc., Kalo Acquisitions, LLC, and Jason H. Pollak.
(d) Consulting Agreement effective September 1, 1995 by and between
Medcross, Inc., Kalo Acquisitions, LLC, and Jason H. Pollak.<F1>
(e) Consulting Agreement effective August 5, 1995 by and between
Medcross, Inc. and Timothy R. Barnes.<F2>
<FN>
<F1>
(1) Incorporated by reference to the Company's registration statement on
Form S-8 dated October 27, 1995 (File Number 0-63749).
<F2>
(2) Incorporated by reference to the Company's registration statement on
Form S-8 dated October 27, 1995 (File Number 0-63751).
</FN>
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
MEDCROSS, INC.
By: /S/ Henry Y.L. Toh
Henry Y.L. Toh
President, CEO, Acting CFO
Date: 1/31/96
<S> <S>
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MR SERVICE AGREEMENT
THIS MR SERVICE AGREEMENT ("Agreement") by and between SOUTH
BAY HOSPITAL, a Florida corporation (hereinafter called the
"Hospital"), and MEDCROSS IMAGING, LTD., a Florida limited partnership
(hereinafter called the "Partnership").
Background Statements:
I. The Partnership was formed for the purpose of providing
mobile magnetic resonance imaging ("MR") service to hospitals.
II. The Hospital has agreed to receive from the Partnership
and the Partnership has agreed to provide to the Hospital mobile MR
service upon the terms and conditions set forth herein.
NOW, THEREFORE, in consideration of the mutual covenants
contained herein, together with other valuable consideration, the
adequacy and sufficiency of which is hereby acknowledged and intending
to be legally bound hereby, the parties agree as follows:
1. Background Statements. The background statements set
forth above are true and correct and are incorporated herein by
reference.
2. Mobile MR Service.
(a) Upon the terms and conditions set forth herein, the
Partnership shall provide mobile MR service to the Hospital and the
Hospital shall receive from the Partnership and pay the Partnership
for such mobile MR service in accordance with the terms hereof.
Service hereunder shall be provided by the Partnership with a 0.5
Tesla magnetic resonance imaging system (the "Imager") which is
mounted in a mobile van. The Imager and the mobile van are
hereinafter referred to as the "Mobile Unit".
(b) The Hospital shall not obtain MR service other than
from the Partnership during the term of this Agreement.
3. Representations.
(a) In order to induce the Partnership to enter into this
Agreement, the Hospital represents and warrants to the Partnership
that the Hospital has received all necessary corporate authority to
enter into and perform its obligations hereunder and the covenants and
agreements of the Hospital set forth herein do not violate or conflict
with any policy of liability insurance that the Hospital may have.
(b) In order to induce the Hospital to enter into this
Agreement, the Partnership represents and warrants to the Hospital
that the Partnership has all necessary partnership authority to enter
into and perform its obligations hereunder.
<PAGE>
4. Covenants and Responsibilities of the Partnership. The
Partnership makes the following covenants to the Hospital and
undertakes the following responsibilities:
(a) it will provide the Mobile Unit at the Hospital at
the designated time and place in accordance with the service schedule
set forth herein;
(b) it will provide one qualified technician who will
perform MR scans in accordance with the information provided by the
Hospital;
(c) it will procure at its expense and, at all times
during which service is provided to the Hospital hereunder, keep in
full force and effect a maintenance contract for the maintenance of
the Imager;
(d) it will procure and, at all times during which
service is provided to the Hospital hereunder, keep in full force and
effect the following insurance coverage:
(i) casualty insurance insuring the Mobile Unit;
(ii) such insurance with respect to the performance
of its technicians provided with the Mobile Unit as the Partnership
shall deem necessary;
(iii) excess liability insurance coverage to a
limit of not less than $1,000,0000; and
(e) it will provide a technician along with the Mobile
Unit on each scheduled day of service, which technician shall be
sufficiently trained to operate the Imager. The Hospital agrees that
the Partnership is not required to and shall not provide professional
interpretation services;
(f) it will, as of the end of each day of service at the
Hospital, provide to the Hospital hard copy images of each scan
performed during such day of service; and
(g) it shall have the exclusive right and responsibility
to schedule patients for MRI scans subject to paragraph 7(b).
(h) it will procure at its expense, Magnavist contrast
media used for MRI patients.
5. Covenants and Responsibilities of Hospital. The Hospital
makes the following covenants to the Partnership and undertakes the
following responsibilities:
(a) it has and will, at its expense, procure and maintain
during the term of this Agreement, all necessary approvals, licenses,
consents, or waivers from any federal, state, regional, or local
health planning agency or other governmental body for the performance
of MR scans on patients at the Hospital utilizing the Mobile Unit;
(b) it will prepare, and keep available at all times
during the scheduled service during the term hereof, the parking site
selected for the Mobile Unit as provided in paragraph 6(b) and will
provide and keep available at all times during which services are
<PAGE>
provided hereunder the ancillary utilities (including, but not limited
to, electrical power and connections for at least two telephone lines
to handle calls to and from the Mobile Unit) in accordance with the
specifications provided by the Imager and van manufacturers and by the
Partnership. The Hospital agrees that, during the term of this
Agreement, the Partnership may park the Mobile Unit at the parking
site located at the Hospital and utilize the Hospital's utilities
while the Mobile Unit is not otherwise in use;
(c) it will implement policies and procedures: (i) for
the delivery and retrieval of patients to and from the Mobile Unit;
(ii) for the care of patients during such delivery to and retrieval
from the Mobile Unit and at all times that patients are located in the
Mobile Unit; and, (iii) in order to comply with all governmental laws,
ordinances, rules, and regulations applicable to building, equipment,
and safety standards other than those applicable to the Mobile Unit
itself;
(d) it will provide a registered nurse or a licensed
practical nurse who shall be present during the delivery and retrieval
of patients and the performance of MR scans on any patients being
cared for in the intensive care or cardiac care unit of the Hospital;
(e) it will keep accurate records for the identification
and care of patients while in the Mobile Unit and with regard to each
scan performed utilizing the Imager while at the Hospital and shall
insure that the patients execute informed consents prior to the
performing of any services under this Agreement by the Partnership;
provided, however, that the Partnership shall have the opportunity to
review the consent form to be used by the Hospital and the
Partnership's reasonable request for modification of such form shall
be complied with by the Hospital;
(f) it will deliver and retrieve patients, along with the
patients' medical records, to and from the Mobile Unit as and when
they are scheduled using its personnel;
(g) it will be responsible for providing such personnel,
procedures, equipment, and facilities as shall fully comply with all
Department of Labor and Industry regulations together with all other
applicable requirements for ingress and egress to and from the
Hospital and the Mobile Unit;
(h) it will be responsible for providing a licensed
physician together with such other medical personnel as may be
required to assist the physician, who, during the period when the
Hospital's patients are in the Mobile Unit, perform or cause to be
performed all tasks of general supervision, diagnosis, and patient
care in accordance with all applicable professional standards, the
Hospital's bylaws and medical staff bylaws, contracts and procedures,
and all other regulations, restrictions, and other requirements of the
Hospital. The physician provided by the Hospital shall be solely
responsible for reading and/or determining the results of the scanning
service. Such physician shall be responsible for communicating those
results to the referring physician, appropriate members of the
Hospital's staff, and to the patients. Provided, however, that the
supervising physician or his or her designee shall be present to
administer all intravenous contrast media and to attend the patient
until such time as the scanning service is completed and the patient
is removed from the Mobile Unit. Nothing in this Agreement or in the
actual operation of the Mobile Unit shall impair or impede or shall
limit the physician's medical judgement exercised for or on behalf of
such patient;
<PAGE>
(i) it will procure and, at all times during which
service is provided to the Hospital hereunder, keep in full force and
effect liability insurance coverage with respect to the performance of
MR scans utilizing the Mobile Unit with a limit of not less than
$1,000,000;
(j) it will provide all consumable medical supplies used
in operating the Imager, including, but not limited to, single
emulsion film, and magnetic storage media; and
(k) the Hospital recognizes that the Partnership's
entrance into this Agreement is induced in part by the covenants and
assurances made by the Hospital that the Hospital will not hire the
Partnership's employees since irrevocable harm and damage will be done
to the Partnership in the event that the Hospital hires any employee
of the Partnership. Therefore, the Hospital agrees that during the
term of this Agreement, and for a period of one year thereafter, the
Hospital shall not, directly or indirectly, hire, contract with, or be
in any way associated with any employee or former employee of the
Partnership. In addition, the Hospital agrees that the hiring of any
such employee or any attempt to induce any such employee to terminate
his or her employment with the Partnership shall be a breach of this
restrictive covenant and shall entitle the Partnership to injunctive
relief without the necessity of bond, all in addition to any other
rights to which the Partnership is entitled and, provided further,
that the Hospital agrees that the Partnership's employees may be
provided by Medcross, Inc., a Florida corporation ("Medcross"),
pursuant to a Management Agreement between the Partnership and
Medcross and, in that case, the Medcross employees shall be considered
to be employees of the Partnership for purposes of this restrictive
covenant.
6. Joint Responsibilities and Covenants of the Partnership
and the Hospital. The following are joint responsibilities and
covenants of the Partnership and the Hospital:
(a) to cooperate and share information, to execute all
documents reasonably required, and to make their personnel available
as may be reasonably required to assist each other in obtaining such
state, local, and other governmental approvals as may be required (i)
for the operation of the Mobile Unit, (ii) to qualify for cost
reimbursements, and (iii) to obtain such approvals as may be necessary
in order that the MR services provided shall be reimbursable by third-
party payors;
(b) mutually agree upon an appropriate parking location
on the current premises of the Hospital for the operation of the
Mobile Unit. The Partnership shall have final approval of the parking
site, which approval shall not be unreasonably withheld;
(c) allow each other reasonable access to all facilities,
personnel, and records as may be necessary for each to keep books of
account, prepare reports to governmental agencies, submit claims for
reimbursement, and the like. The Partnership may from time to time
specify the information that such records shall contain and may obtain
copies or summaries of such records. All information obtained shall
be kept confidential to the extent that it may involve records or
reports of any patient treatment; and
(d) to provide to each other certificates of all
insurance carried by them pertaining to the operations contemplated
herein.
<PAGE>
7. Scheduling.
(a) Subject to the provisions of paragraph 7(b), the
Partnership shall provide service to the Hospital on the days set
forth in the service schedule attached hereto as Exhibit "A". Service
shall commence on the first scheduled day of service on or after the
Commencement Date.
(b) During each full day of service, the Mobile Unit
shall be available for the performance of scans from 7:00 a.m. to 6:00
p.m. The first patient during each day of service shall be scheduled
before 9:00 a.m. and patients shall be scheduled on a consecutive
basis thereafter. The Mobile Unit and the technician may be removed
from the Hospital at any time after the scan on the last scheduled
patient has been completed, even if it is before 6:00 p.m. The
Partnership shall not be obligated to commence any scans after 5:00
p.m. However, if all scheduled patients cannot be completed before
6:00 p.m., the Partnership may, in its discretion, make the Mobile
Unit available for scans after 6:00 p.m. In the event that any
scheduled day of service falls on any one of the following holidays,
the Hospital shall have the option of electing not to receive service
on that day: New Year's Day, Memorial Day, Fourth of July, Labor Day,
Thanksgiving Day, Christmas Eve, and Christmas Day. In the event that
the Hospital elects not to receive service during any such holiday,
upon request of the Hospital, the Partnership will use its best
efforts to reschedule the Mobile Unit during the next available
unscheduled day, which may be a weekend or a holiday.
(c) The Hospital understands that the Imager is a complex
mechanical and electronic device, that there may be times that it will
break down and that it will break down and that it is impossible to
predict when that will occur. The Imager must also undergo periodic
maintenance. Anything to the contrary set forth herein
notwithstanding, in no event shall the Partnership be liable to the
Hospital as a result of the unavailability of the Mobile Unit for any
reason.
8. Charges for MR Service.
(a) The following definitions apply for purposes of this
paragraph 8:
(i) "Standard Charge" means $350
per MR scan completed utilizing the Mobile Unit while located at the
Hospital.
(ii) "Minimum Monthly Charge"
means the number of days during the month the Mobile Unit is scheduled
and available for service multiplied by thirteen (13) scans per day,
and further multiplied by the Standard Charge.
(iii) "Incomplete Scan Charge"
means $100 per MR scan that cannot be completed due to reasons such as
claustrophobia, etc., or whenever a radiologist requests the patient
return on a separate day from the day the original scan was performed
to scan additional sequences on the same anatomical area.
(b) The Partnership will provide the Hospital with an
invoice at the end of each month for the greater of: (i) the Standard
Charge for each MR scan completed plus any Incomplete Scan charges;
or, (ii) the Monthly Minimum Charge plus any Incomplete Scan Charges.
<PAGE>
(c) The Partnership shall mail a statement of account to
the Hospital as of the first day of each month. If any invoices are
past due as of the statement date, the Hospital shall pay late charges
in an amount equal to 1-1/2% per month of the amount of each past due
invoice. In addition to any and all remedies available to the
Partnership for defaults hereunder by the Hospital, in the event that
there are any invoices to the Hospital from the Partnership that are
15 days or more past due the Partnership may require the Hospital to
pay in cash not less than five days prior to a scheduled day of
service for each scan scheduled for that day.
(d) The Hospital's obligation to pay the charges set
forth herein to the Partnership is absolute and unconditional at the
time that MR scans are performed utilizing the Mobile Unit while
located at the Hospital. The obligation of the Hospital to pay the
charges set forth herein to the Partnership is distinct and
independent from the payment to the Hospital by or on account of the
patients scheduled by the Hospital for MR scans. The collection and
discharge of such patient accounts are the sole responsibility of the
Hospital and not of the Partnership.
9. Indemnification.
(a) The Hospital shall indemnify and hold harmless the
Partnership, its partners (exclusive of the Hospital in the event that
the Hospital is a partner of the Partnership), its employees, and the
directors, officers, and employees of the general partner of the
Partnership (each of the foregoing is herein referred to as an
"Indemnitee") from and against any and all Loss arising in connection
with or as a result of (i) any breach hereof by the Hospital; (ii) the
presence of the Mobile Unit at the designated parking space, (iii) the
movement of any person to and from or within the Mobile Unit, (iv) any
failure to diagnose conditions in any patient, unless due to the
negligence of the Partnership or its employees, or (v) any other
matter involving professional malpractice or negligence on the part of
the Hospital or its employees.
(b) The Partnership shall indemnify and hold harmless the
Hospital and its directors and trustees, officers, and employees from
and against any and all Loss arising in connection with or as a result
of (i) any breach thereof by the Partnership; (ii) any matter
involving negligence on the part of the Partnership or its employees;
and (iii) any injury to any person or damage to property occurring
while the Mobile Unit is in transit.
(c) If any event shall give rise to an assertion by a
party hereto that the other party should indemnify it, the party
claiming indemnification shall promptly give written notice to the
other, setting forth the basis of the claim. The parties shall
cooperate to ensure that any lawsuit or claim is answered in a timely
fashion. The indemnifying party may appoint counsel to defend the
matter, although such counsel shall be acceptable to both parties.
The indemnified party may, however, at its discretion, participate in
the defense of such matter and may be represented by its own counsel,
and such shall not be deemed to waive its right to indemnification for
expenses of attorneys. The indemnified party may not settle,
compromise, or pay any matter without the express, prior consent of
the indemnifying party. The right to obtain indemnification hereunder
shall survive any termination of this Agreement and shall not be
subject to any right of set-off or counterclaim.
<PAGE>
(d) For the purposes of this paragraph 9, the term "Loss"
shall mean any loss, damage, liability, cost, and expense including,
without limitation, any interest, fine, court costs, reasonable
investigation costs, penalties, and attorneys' and expert witness fees
(including such fee in all trials, appeals, and administrative
proceedings), disbursements, and expenses.
(e) Each party's obligations to indemnify the other party
hereunder is independent of and not affected by the availability or
non-availability of any insurance coverage or payment under any policy
of insurance, from any trust fund, or otherwise nor shall the
obligation of the party to indemnify the other party hereunder be
affected by any change in insurance, reduction in coverage, change in
policy terms, creation of trust funds, or any other cause.
10. Managing Agent. The Hospital acknowledges that the
Partnership has contracted with Medcross to act as its management
agent. The Hospital agrees to cooperate fully with Medcross and its
employees and to accept the requests and directions of Medcross as
representing those of the Partnership.
11. Default and Termination.
(a) It shall be an event of default by the Hospital if
any one of the following events shall happen:
(i) the Hospital shall fail to pay to the
Partnership the charges provided for in paragraph 8 when due;
(ii) the Hospital shall fail to keep, observe, or
perform any other covenant, agreement, term, or provision of this
Agreement to be kept, observed, or performed by the Hospital and any
such failure shall continue for a period of 30 days after notice
thereof is given by the Partnership to the Hospital; provided,
however, if any such failure may, in the opinion of the Partnership,
adversely affect the safety of patients, or constitutes a violation of
applicable law, rule, or regulation of a governmental authority, such
default shall be cured immediately by the Hospital.
(iii) the Hospital shall apply for or consent to
the appointment of a receiver, trustee, or liquidator of the Hospital
of all or a substantial part of its assets, file a voluntary petition
in bankruptcy, or admit in writing its inability to pay its debts as
they come due, make a general assignment for the benefit of creditors,
file a petition of an answer seeking reorganization or arrangement
with creditors or to take advantage of any insolvency law or file an
answer admitting the material allegations of a petition filed against
the Hospital in any bankruptcy, reorganization, or insolvency
proceeding, or the entry of an order, judgement, or decree by a court
of competent jurisdiction, on the application of a creditor,
adjudicating the Hospital a bankrupt or insolvent or approving a
petition seeking reorganization of the Hospital or appointing a
receiver, trustee, or liquidator of the Hospital or if all or a
substantial part of its assets and such order, judgement, or decree
shall continue unstayed and in effect for a period of 60 consecutive
days.
(b) In the event of an occurrence of an event of default
by the Hospital, the Partnership shall have the right to terminate
this Agreement upon ten (10) days' written notice to the Hospital
given at any time after the period of grace applicable thereto, and
thereupon this Agreement shall terminate upon the expiration of such
ten (10) day period. Provided, however, (i) if the default is for
<PAGE>
failure of the Hospital to pay when due the charges provided for in
paragraph 8, the Partnership may terminate this Agreement effective
immediately upon the delivery to the Hospital of written notice of
termination, and (ii) if any default may adversely affect the safety
of patients, or constitutes a violation of applicable law, rule, or
regulation of a governmental authority, the Partnership may
immediately suspend service hereunder without prejudice to its
termination rights hereunder.
(c) It shall be an event of default by the Partnership if
any one of the following events shall happen:
(i) the Partnership shall fail to keep, observe, or
perform any covenant, agreement, term, or provision of this Agreement
to be kept, observed, or performed by the Partnership and any such
failure shall continue for a period of 30 days after written notice
thereof given by the Hospital to the Partnership;
(ii) the Partnership shall apply for or consent to
the appointment of a receiver, trustee, or liquidator of the
Partnership or of all or a substantial part of its assets, file a
voluntary petition in bankruptcy, or admit in writing its inability to
pay its debts as they come due, make a general assignment for the
benefit of creditors, file a petition or an answer seeking
reorganization or arrangement with creditors or to take advantage of
any insolvency law, or file an answer admitting the material
allegations of a petition filed against the Partnership in any
bankruptcy, reorganization, or insolvency proceeding, or the entry of
an order, judgement, or decree by a court of competent jurisdiction,
on the application of a creditor, adjudicating the Partnership a
bankrupt or insolvent or approving a petition seeking reorganization
of the Partnership or appointing a receiver, trustee, or liquidator of
the Partnership or of all or a substantial part of its assets and such
order, judgement, or decree shall continue unstayed and in effect for
a period of 60 consecutive days.
(d) In the event of an occurrence of an event of default
by the Partnership, the Hospital shall have the right to terminate
this Agreement upon 10 days written notice to the Partnership given at
any time after the period of grace applicable thereto, and thereupon
this Agreement shall terminate upon the expiration of such 10 day
period.
(e) The termination of this Agreement under the provision
of paragraphs 11(b) and 11(d) shall not affect the rights of the
Hospital or the Partnership with respect to any damages they have
suffered as the result of any breach of this Agreement, nor shall it
affect the rights of the Hospital or the Partnership with respect to
liability or claims accrued, or arising out of events occurring, prior
to the date of termination. Neither the right of termination nor the
right to bring an action for damages nor any other remedy available to
either party hereunder shall be exclusive of any other remedy given
hereunder or now or hereafter existing at law or in equity.
12. Term. This Agreement shall continue for a period of
seventeen (17) months beginning October 1, 1995 (the "Commencement
Date") and shall be renewed automatically for additional one-year
terms unless either party notifies the other party in writing at least
ninety (90) days prior to the end of the then current term of its
intent not to renew.
<PAGE>
13. Force Majeure.
(a) Anything to the contrary set forth herein
notwithstanding, in the event that the Partnership is rendered unable,
wholly or in part, by force majeure (as hereinafter defined) to carry
out its obligations under this Agreement, then it shall give to the
Hospital prompt notice of the force majeure with reasonably full
particulars; thereupon, the obligations of the Partnership, so far as
they are affected by the force majeure, shall be suspended. The
Partnership shall use all reasonable diligence to resume its
obligations as quickly as possible to the extent the same is within
its reasonable control.
(b) The term "force majeure" shall mean an act of God,
strike, lockout, or other industrial disturbance, act of the public
enemy, war, blockade, public riot, lightning, fire, storm, flood,
explosion, governmental restraint, accident, unavailability of
equipment due to maintenance, whether preventative or otherwise, delay
in delivery of equipment, inoperability of equipment, adverse weather
conditions, and any other cause whether of the kind specifically
enumerated above or otherwise which precludes the Partnership's
performance hereunder and is not reasonably within the control of the
Partnership.
14. Miscellaneous.
(a) It is expressly understood that the systems, methods,
procedures, written materials, and controls employed by the
Partnership in the performance of this Agreement are proprietary in
nature, shall remain the property of the Partnership, and shall not at
any time be utilized, distributed, copied, or otherwise employed or
acquired by the Hospital unless approved by the Partnership.
(b) Notwithstanding the place where this Agreement may be
executed by either of the parties, this Agreement, the rights and
obligations of the parties, and any claims and disputes relating
thereto shall be subject to and governed by the laws of the State of
Florida as applied to agreements among Florida residents to be entered
into and performed entirely within the State of Florida. Such laws
shall govern all aspects of this Agreement.
(c) This Agreement represents the entire understanding of
the parties with respect to the subject matter hereof and supersedes
all prior negotiations, understandings, agreements, and
representations. No amendment of this Agreement shall be binding or
of any effect unless in writing duly signed by both parties hereto.
(d) This Agreement shall be binding upon and shall inure
to the benefit of the parties hereto and their respective successors
and assigns. This Agreement may be assigned by either party to a
successor in interest to all or substantially all of the assets or
business of the assigning party who shall promptly notify the other
party of the assignment of this Agreement. Any other assignment by a
party (except a collateral assignment by the Partnership to a
financial institution or lessor which makes available funds for the
Mobile Unit) shall require the prior written consent of either party,
which consent shall not be unreasonably withheld.
<PAGE>
(e) No waiver by any party hereto of any default of or
breach by any other party under this Agreement shall operate as a
waiver of any future default or breach, whether of like or different
character or nature.
(f) Any notice required or permitted by this Agreement
shall be in writing and shall be deemed given at the time it is
deposited in the United States mail, postage prepaid, certified or
registered mail, return receipt requested, addressed to the party to
whom it is to be given as follows:
HOSPITAL: South Bay Hospital
4016 State Road 674
Sun City Center, FL 33570
COMPANY: Medcross Imaging, Ltd.
3227 Bennet Street North
St. Petersburg, FL 33713
ATTN: Doree' Michon
Either party may change its address to which notices shall be sent by
a notice similarly sent.
(g) To the extent required by law, the Partnership hereby
agrees that for a period of four years after this Agreement
terminates, it shall make available upon written request of the
Secretary of Health and Human Services or upon request of the
Controller General or any duly authorized representative thereof, this
Agreement and the books, documents, and records that may be necessary
to certify the nature and extent of the costs related to this
Agreement with the Hospital and, furthermore, the Partnership agrees
that, if any of the value or cost of any work is provided pursuant to
a subcontract with a value of $10,000 or more, the Partnership shall
require that any such subcontractor sign a similar agreement to make
its books and records available for such four-year period of time.
(h) In the event of any litigation between the parties
arising out of or relating to this Agreement, the prevailing party
shall be entitled to recover all of its costs and expenses including,
but not limited to, reasonable attorneys' fees, including attorneys'
fees in all trials, appeals, and administrative proceedings.
<PAGE>
The parties hereto have executed this Agreement as of the 1st
day of October, 1995.
MEDCROSS IMAGING, LTD., a Florida limited partnership
BY: MEDCROSS, INC., General
Partner
By: /s/ Doree Michon
As Vice President - Operations
SOUTH BAY HOSPITAL, a Florida
corporation
By: /s/ Joseph Mulley
As Administrator
"HOSPITAL"
<PAGE>
EXHIBIT "A"
Schedule of Service
DAY TIME<F1>
Tuesday 7:00 a.m. - 6:00 p.m.
Thursday<F2> -----
<FN>
<F1>
1 See paragraph 7 regarding the terms of scheduled days of
service.
<F2>
2 Thursday service is provided on an "as-needed" basis by the
Partnership. The Partnership, therefore, will not consider
Thursday as a day of service for the purpose of calculating
the Daily Minimum Charge.
</FN>
<S> <S>
</TABLE>
<TABLE>
MR SERVICE AGREEMENT
THIS MR SERVICE AGREEMENT ("Agreement") by and between EDWARD
WHITE HOSPITAL, a Florida corporation (hereinafter called the
"Hospital"), and MEDCROSS IMAGING, LTD., a Florida limited partnership
(hereinafter called the "Partnership").
Background Statements:
I. The Partnership was formed for the purpose of providing
mobile magnetic resonance imaging ("MR") service to hospitals.
II. The Hospital has agreed to receive from the Partnership
and the Partnership has agreed to provide to the Hospital mobile MR
service upon the terms and conditions set forth herein.
NOW, THEREFORE, in consideration of the mutual covenants
contained herein, together with other valuable consideration, the
adequacy and sufficiency of which is hereby acknowledged and intending
to be legally bound hereby, the parties agree as follows:
1. Background Statements. The background statements set
forth above are true and correct and are incorporated herein by
reference.
2. Mobile MR Service.
(a) Upon the terms and conditions set forth herein, the
Partnership shall provide mobile MR service to the Hospital and the
Hospital shall receive from the Partnership and pay the Partnership
for such mobile MR service in accordance with the terms hereof.
Service hereunder shall be provided by the Partnership with a 0.5
Tesla magnetic resonance imaging system (the "Imager") which is
mounted in a mobile van. The Imager and the mobile van are
hereinafter referred to as the "Mobile Unit".
(b) The Hospital shall not obtain MR service other than
from the Partnership during the term of this Agreement.
3. Representations.
(a) In order to induce the Partnership to enter into this
Agreement, the Hospital represents and warrants to the Partnership
that the Hospital has received all necessary corporate authority to
enter into and perform its obligations hereunder and the covenants and
agreements of the Hospital set forth herein do not violate or conflict
with any policy of liability insurance that the Hospital may have.
(b) In order to induce the Hospital to enter into this
Agreement, the Partnership represents and warrants to the Hospital
that the Partnership has all necessary partnership authority to enter
into and perform its obligations hereunder.
<PAGE>
4. Covenants and Responsibilities of the Partnership. The
Partnership makes the following covenants to the Hospital and
undertakes the following responsibilities:
(a) it will provide the Mobile Unit at the Hospital at
the designated time and place in accordance with the service schedule
set forth herein;
(b) it will provide one qualified technician who will
perform MR scans in accordance with the information provided by the
Hospital;
(c) it will procure at its expense and, at all times
during which service is provided to the Hospital hereunder, keep in
full force and effect a maintenance contract for the maintenance of
the Imager;
(d) it will procure and, at all times during which
service is provided to the Hospital hereunder, keep in full force and
effect the following insurance coverage:
(i) casualty insurance insuring the Mobile Unit;
(ii) such insurance with respect to the performance
of its technicians provided with the Mobile Unit as the Partnership
shall deem necessary;
(iii) excess liability insurance coverage to a
limit of not less than $1,000,0000; and
(e) it will provide a technician along with the Mobile
Unit on each scheduled day of service, which technician shall be
sufficiently trained to operate the Imager. The Hospital agrees that
the Partnership is not required to and shall not provide professional
interpretation services;
(f) it will, as of the end of each day of service at the
Hospital, provide to the Hospital hard copy images of each scan
performed during such day of service; and
(g) it shall have the exclusive right and responsibility
to schedule patients for MRI scans subject to paragraph 7(b).
(h) it will procure at its expense, Magnavist contrast
media used for MRI patients.
5. Covenants and Responsibilities of Hospital. The Hospital
makes the following covenants to the Partnership and undertakes the
following responsibilities:
(a) it has and will, at its expense, procure and maintain
during the term of this Agreement, all necessary approvals, licenses,
consents, or waivers from any federal, state, regional, or local
health planning agency or other governmental body for the performance
of MR scans on patients at the Hospital utilizing the Mobile Unit;
(b) it will prepare, and keep available at all times
during the scheduled service during the term hereof, the parking site
selected for the Mobile Unit as provided in paragraph 6(b) and will
provide and keep available at all times during which services are
<PAGE>
provided hereunder the ancillary utilities (including, but not limited
to, electrical power and connections for at least two telephone lines
to handle calls to and from the Mobile Unit) in accordance with the
specifications provided by the Imager and van manufacturers and by the
Partnership. The Hospital agrees that, during the term of this
Agreement, the Partnership may park the Mobile Unit at the parking
site located at the Hospital and utilize the Hospital's utilities
while the Mobile Unit is not otherwise in use;
(c) it will implement policies and procedures: (i) for
the delivery and retrieval of patients to and from the Mobile Unit;
(ii) for the care of patients during such delivery to and retrieval
from the Mobile Unit and at all times that patients are located in the
Mobile Unit; and, (iii) in order to comply with all governmental laws,
ordinances, rules, and regulations applicable to building, equipment,
and safety standards other than those applicable to the Mobile Unit
itself;
(d) it will provide a registered nurse or a licensed
practical nurse who shall be present during the delivery and retrieval
of patients and the performance of MR scans on any patients being
cared for in the intensive care or cardiac care unit of the Hospital;
(e) it will keep accurate records for the identification
and care of patients while in the Mobile Unit and with regard to each
scan performed utilizing the Imager while at the Hospital and shall
insure that the patients execute informed consents prior to the
performing of any services under this Agreement by the Partnership;
provided, however, that the Partnership shall have the opportunity to
review the consent form to be used by the Hospital and the
Partnership's reasonable request for modification of such form shall
be complied with by the Hospital;
(f) it will deliver and retrieve patients, along with the
patients' medical records, to and from the Mobile Unit as and when
they are scheduled using its personnel;
(g) it will be responsible for providing such personnel,
procedures, equipment, and facilities as shall fully comply with all
Department of Labor and Industry regulations together with all other
applicable requirements for ingress and egress to and from the
Hospital and the Mobile Unit;
(h) it will be responsible for providing a licensed
physician together with such other medical personnel as may be
required to assist the physician, who, during the period when the
Hospital's patients are in the Mobile Unit, perform or cause to be
performed all tasks of general supervision, diagnosis, and patient
care in accordance with all applicable professional standards, the
Hospital's bylaws and medical staff bylaws, contracts and procedures,
and all other regulations, restrictions, and other requirements of the
Hospital. The physician provided by the Hospital shall be solely
responsible for reading and/or determining the results of the scanning
service. Such physician shall be responsible for communicating those
results to the referring physician, appropriate members of the
Hospital's staff, and to the patients. Provided, however, that the
supervising physician or his or her designee shall be present to
administer all intravenous contrast media and to attend the patient
until such time as the scanning service is completed and the patient
is removed from the Mobile Unit. Nothing in this Agreement or in the
actual operation of the Mobile Unit shall impair or impede or shall
limit the physician's medical judgement exercised for or on behalf of
such patient;
<PAGE>
(i) it will procure and, at all times during which
service is provided to the Hospital hereunder, keep in full force and
effect liability insurance coverage with respect to the performance of
MR scans utilizing the Mobile Unit with a limit of not less than
$1,000,000;
(j) it will provide all consumable medical supplies used
in operating the Imager, including, but not limited to, single
emulsion film, and magnetic storage media; and
(k) the Hospital recognizes that the Partnership's
entrance into this Agreement is induced in part by the covenants and
assurances made by the Hospital that the Hospital will not hire the
Partnership's employees since irrevocable harm and damage will be done
to the Partnership in the event that the Hospital hires any employee
of the Partnership. Therefore, the Hospital agrees that during the
term of this Agreement, and for a period of one year thereafter, the
Hospital shall not, directly or indirectly, hire, contract with, or be
in any way associated with any employee or former employee of the
Partnership. In addition, the Hospital agrees that the hiring of any
such employee or any attempt to induce any such employee to terminate
his or her employment with the Partnership shall be a breach of this
restrictive covenant and shall entitle the Partnership to injunctive
relief without the necessity of bond, all in addition to any other
rights to which the Partnership is entitled and, provided further,
that the Hospital agrees that the Partnership's employees may be
provided by Medcross, Inc., a Florida corporation ("Medcross"),
pursuant to a Management Agreement between the Partnership and
Medcross and, in that case, the Medcross employees shall be considered
to be employees of the Partnership for purposes of this restrictive
covenant.
6. Joint Responsibilities and Covenants of the Partnership
and the Hospital. The following are joint responsibilities and
covenants of the Partnership and the Hospital:
(a) to cooperate and share information, to execute all
documents reasonably required, and to make their personnel available
as may be reasonably required to assist each other in obtaining such
state, local, and other governmental approvals as may be required (i)
for the operation of the Mobile Unit, (ii) to qualify for cost
reimbursements, and (iii) to obtain such approvals as may be necessary
in order that the MR services provided shall be reimbursable by third-
party payors;
(b) mutually agree upon an appropriate parking location
on the current premises of the Hospital for the operation of the
Mobile Unit. The Partnership shall have final approval of the parking
site, which approval shall not be unreasonably withheld;
(c) allow each other reasonable access to all facilities,
personnel, and records as may be necessary for each to keep books of
account, prepare reports to governmental agencies, submit claims for
reimbursement, and the like. The Partnership may from time to time
specify the information that such records shall contain and may obtain
copies or summaries of such records. All information obtained shall
be kept confidential to the extent that it may involve records or
reports of any patient treatment; and
(d) to provide to each other certificates of all
insurance carried by them pertaining to the operations contemplated
herein.
<PAGE>
7. Scheduling.
(a) Subject to the provisions of paragraph 7(b), the
Partnership shall provide service to the Hospital on the days set
forth in the service schedule attached hereto as Exhibit "A". Service
shall commence on the first scheduled day of service on or after the
Commencement Date.
(b) During each full day of service, the Mobile Unit
shall be available for the performance of scans from 7:00 a.m. to 6:00
p.m. The first patient during each day of service shall be scheduled
before 9:00 a.m. and patients shall be scheduled on a consecutive
basis thereafter. The Mobile Unit and the technician may be removed
from the Hospital at any time after the scan on the last scheduled
patient has been completed, even if it is before 6:00 p.m. The
Partnership shall not be obligated to commence any scans after 5:00
p.m. However, if all scheduled patients cannot be completed before
6:00 p.m., the Partnership may, in its discretion, make the Mobile
Unit available for scans after 6:00 p.m. In the event that any
scheduled day of service falls on any one of the following holidays,
the Hospital shall have the option of electing not to receive service
on that day: New Year's Day, Memorial Day, Fourth of July, Labor Day,
Thanksgiving Day, Christmas Eve, and Christmas Day. In the event that
the Hospital elects not to receive service during any such holiday,
upon request of the Hospital, the Partnership will use its best
efforts to reschedule the Mobile Unit during the next available
unscheduled day, which may be a weekend or a holiday.
(c) The Hospital understands that the Imager is a complex
mechanical and electronic device, that there may be times that it will
break down and that it will break down and that it is impossible to
predict when that will occur. The Imager must also undergo periodic
maintenance. Anything to the contrary set forth herein
notwithstanding, in no event shall the Partnership be liable to the
Hospital as a result of the unavailability of the Mobile Unit for any
reason.
8. Charges for MR Service.
(a) The following definitions apply for purposes of this
paragraph 8:
(i) "Standard Charge" means $350
per MR scan completed utilizing the Mobile Unit while located at the
Hospital.
(ii) "Minimum Monthly Charge"
means the number of days during the month the Mobile Unit is scheduled
and available for service multiplied by seven (7) scans per day, and
further multiplied by the Standard Charge.
(iii) "Incomplete Scan Charge"
means $100 per MR scan that cannot be completed due to reasons such as
claustrophobia, etc., or whenever a radiologist requests the patient
return on a separate day from the day the original scan was performed
to scan additional sequences on the same anatomical area.
(iv) "Letter of Protection (LOP)
Patient" means a patient where legal counsel, pursuant to a lawsuit,
has issued a written request for immunity from payment of charges
until settlement of the lawsuit.
<PAGE>
(b) The Partnership will provide the Hospital with an
invoice at the end of each month for the greater of: (i) the Standard
Charge for each MR patient scan completed plus any Incomplete Scan and
LOP charges; or, (ii) the Monthly Minimum Charge plus any Incomplete
Scan charges and LOP charges. Invoices shall be paid within thirty
(30) days.
(c) The Partnership shall mail a statement of account to
the Hospital as of the first day of each month. If any invoices are
past due as of the statement date, the Hospital shall pay late charges
in an amount equal to 1-1/2% per month of the amount of each past due
invoice. In addition to any and all remedies available to the
Partnership for defaults hereunder by the Hospital, in the event that
there are any invoices to the Hospital from the Partnership that are
15 days or more past due the Partnership may require the Hospital to
pay in cash not less than five days prior to a scheduled day of
service for each scan scheduled for that day.
(d) The Hospital's obligation to pay the charges set
forth herein to the Partnership is absolute and unconditional at the
time that MR scans are performed utilizing the Mobile Unit while
located at the Hospital. The obligation of the Hospital to pay the
charges set forth herein to the Partnership is distinct and
independent from the payment to the Hospital by or on account of the
patients scheduled by the Hospital for MR scans. The collection and
discharge of such patient accounts are the sole responsibility of the
Hospital and not of the Partnership.
(e) The Partnership shall be responsible for the billing
and collection for all services rendered to Letter of Protection
Patients. The Partnership shall issue a credit to the Hospital to
cover the cost of supplies used in the amount of $40 per Letter of
Protection Patient with an additional credit of $100 for each patient
utilizing contrast material. The credit will be issued monthly.
9. Indemnification.
(a) The Hospital shall indemnify and hold harmless the
Partnership, its partners (exclusive of the Hospital in the event that
the Hospital is a partner of the Partnership), its employees, and the
directors, officers, and employees of the general partner of the
Partnership (each of the foregoing is herein referred to as an
"Indemnitee") from and against any and all Loss arising in connection
with or as a result of (i) any breach hereof by the Hospital; (ii) the
presence of the Mobile Unit at the designated parking space, (iii) the
movement of any person to and from or within the Mobile Unit, (iv) any
failure to diagnose conditions in any patient, unless due to the
negligence of the Partnership or its employees, or (v) any other
matter involving professional malpractice or negligence on the part of
the Hospital or its employees.
(b) The Partnership shall indemnify and hold harmless the
Hospital and its directors and trustees, officers, and employees from
and against any and all Loss arising in connection with or as a result
of (i) any breach thereof by the Partnership; (ii) any matter
involving negligence on the part of the Partnership or its employees;
and (iii) any injury to any person or damage to property occurring
while the Mobile Unit is in transit.
(c) If any event shall give rise to an assertion by a
party hereto that the other party should indemnify it, the party
claiming indemnification shall promptly give written notice to the
other, setting forth the basis of the claim. The parties shall
<PAGE>
cooperate to ensure that any lawsuit or claim is answered in a timely
fashion. The indemnifying party may appoint counsel to defend the
matter, although such counsel shall be acceptable to both parties.
The indemnified party may, however, at its discretion, participate in
the defense of such matter and may be represented by its own counsel,
and such shall not be deemed to waive its right to indemnification for
expenses of attorneys. The indemnified party may not settle,
compromise, or pay any matter without the express, prior consent of
the indemnifying party. The right to obtain indemnification hereunder
shall survive any termination of this Agreement and shall not be
subject to any right of set-off or counterclaim.
(d) For the purposes of this paragraph 9, the term "Loss"
shall mean any loss, damage, liability, cost, and expense including,
without limitation, any interest, fine, court costs, reasonable
investigation costs, penalties, and attorneys' and expert witness fees
(including such fee in all trials, appeals, and administrative
proceedings), disbursements, and expenses.
(e) Each party's obligations to indemnify the other party
hereunder is independent of and not affected by the availability or
non-availability of any insurance coverage or payment under any policy
of insurance, from any trust fund, or otherwise nor shall the
obligation of the party to indemnify the other party hereunder be
affected by any change in insurance, reduction in coverage, change in
policy terms, creation of trust funds, or any other cause.
10. Managing Agent. The Hospital acknowledges that the
Partnership has contracted with Medcross to act as its management
agent. The Hospital agrees to cooperate fully with Medcross and its
employees and to accept the requests and directions of Medcross as
representing those of the Partnership.
11. Default and Termination.
(a) It shall be an event of default by the Hospital if
any one of the following events shall happen:
(i) the Hospital shall fail to pay to the
Partnership the charges provided for in paragraph 8 when due;
(ii) the Hospital shall fail to keep, observe, or
perform any other covenant, agreement, term, or provision of this
Agreement to be kept, observed, or performed by the Hospital and any
such failure shall continue for a period of 30 days after notice
thereof is given by the Partnership to the Hospital; provided,
however, if any such failure may, in the opinion of the Partnership,
adversely affect the safety of patients, or constitutes a violation of
applicable law, rule, or regulation of a governmental authority, such
default shall be cured immediately by the Hospital.
(iii) the Hospital shall apply for or consent to
the appointment of a receiver, trustee, or liquidator of the Hospital
of all or a substantial part of its assets, file a voluntary petition
in bankruptcy, or admit in writing its inability to pay its debts as
they come due, make a general assignment for the benefit of creditors,
file a petition of an answer seeking reorganization or arrangement
with creditors or to take advantage of any insolvency law or file an
answer admitting the material allegations of a petition filed against
the Hospital in any bankruptcy, reorganization, or insolvency
proceeding, or the entry of an order, judgement, or decree by a court
<PAGE>
of competent jurisdiction, on the application of a creditor,
adjudicating the Hospital a bankrupt or insolvent or approving a
petition seeking reorganization of the Hospital or appointing a
receiver, trustee, or liquidator of the Hospital or if all or a
substantial part of its assets and such order, judgement, or decree
shall continue unstayed and in effect for a period of 60 consecutive
days.
(b) In the event of an occurrence of an event of default
by the Hospital, the Partnership shall have the right to terminate
this Agreement upon ten (10) days' written notice to the Hospital
given at any time after the period of grace applicable thereto, and
thereupon this Agreement shall terminate upon the expiration of such
ten (10) day period. Provided, however, (i) if the default is for
failure of the Hospital to pay when due the charges provided for in
paragraph 8, the Partnership may terminate this Agreement effective
immediately upon the delivery to the Hospital of written notice of
termination, and (ii) if any default may adversely affect the safety
of patients, or constitutes a violation of applicable law, rule, or
regulation of a governmental authority, the Partnership may
immediately suspend service hereunder without prejudice to its
termination rights hereunder.
(c) It shall be an event of default by the Partnership if
any one of the following events shall happen:
(i) the Partnership shall fail to keep, observe, or
perform any covenant, agreement, term, or provision of this Agreement
to be kept, observed, or performed by the Partnership and any such
failure shall continue for a period of 30 days after written notice
thereof given by the Hospital to the Partnership;
(ii) the Partnership shall apply for or consent to
the appointment of a receiver, trustee, or liquidator of the
Partnership or of all or a substantial part of its assets, file a
voluntary petition in bankruptcy, or admit in writing its inability to
pay its debts as they come due, make a general assignment for the
benefit of creditors, file a petition or an answer seeking
reorganization or arrangement with creditors or to take advantage of
any insolvency law, or file an answer admitting the material
allegations of a petition filed against the Partnership in any
bankruptcy, reorganization, or insolvency proceeding, or the entry of
an order, judgement, or decree by a court of competent jurisdiction,
on the application of a creditor, adjudicating the Partnership a
bankrupt or insolvent or approving a petition seeking reorganization
of the Partnership or appointing a receiver, trustee, or liquidator of
the Partnership or of all or a substantial part of its assets and such
order, judgement, or decree shall continue unstayed and in effect for
a period of 60 consecutive days.
(d) In the event of an occurrence of an event of default
by the Partnership, the Hospital shall have the right to terminate
this Agreement upon 10 days written notice to the Partnership given at
any time after the period of grace applicable thereto, and thereupon
this Agreement shall terminate upon the expiration of such 10 day
period.
(e) The termination of this Agreement under the provision
of paragraphs 11(b) and 11(d) shall not affect the rights of the
Hospital or the Partnership with respect to any damages they have
suffered as the result of any breach of this Agreement, nor shall it
affect the rights of the Hospital or the Partnership with respect to
liability or claims accrued, or arising out of events occurring, prior
to the date of termination. Neither the right of termination nor the
<PAGE>
right to bring an action for damages nor any other remedy available to
either party hereunder shall be exclusive of any other remedy given
hereunder or now or hereafter existing at law or in equity.
12. Term. This Agreement shall continue for a period of one
(1) year beginning March 1, 1996 (the "Commencement Date") and shall
be renewed automatically for additional one-year terms unless either
party notifies the other party in writing at least ninety (90) days
prior to the end of the then current term of its intent not to renew.
13. Force Majeure.
(a) Anything to the contrary set forth herein
notwithstanding, in the event that the Partnership is rendered unable,
wholly or in part, by force majeure (as hereinafter defined) to carry
out its obligations under this Agreement, then it shall give to the
Hospital prompt notice of the force majeure with reasonably full
particulars; thereupon, the obligations of the Partnership, so far as
they are affected by the force majeure, shall be suspended. The
Partnership shall use all reasonable diligence to resume its
obligations as quickly as possible to the extent the same is within
its reasonable control.
(b) The term "force majeure" shall mean an act of God,
strike, lockout, or other industrial disturbance, act of the public
enemy, war, blockade, public riot, lightning, fire, storm, flood,
explosion, governmental restraint, accident, unavailability of
equipment due to maintenance, whether preventative or otherwise, delay
in delivery of equipment, inoperability of equipment, adverse weather
conditions, and any other cause whether of the kind specifically
enumerated above or otherwise which precludes the Partnership's
performance hereunder and is not reasonably within the control of the
Partnership.
14. Miscellaneous.
(a) It is expressly understood that the systems, methods,
procedures, written materials, and controls employed by the
Partnership in the performance of this Agreement are proprietary in
nature, shall remain the property of the Partnership, and shall not at
any time be utilized, distributed, copied, or otherwise employed or
acquired by the Hospital unless approved by the Partnership.
(b) Notwithstanding the place where this Agreement may be
executed by either of the parties, this Agreement, the rights and
obligations of the parties, and any claims and disputes relating
thereto shall be subject to and governed by the laws of the State of
Florida as applied to agreements among Florida residents to be entered
into and performed entirely within the State of Florida. Such laws
shall govern all aspects of this Agreement.
(c) This Agreement represents the entire understanding of
the parties with respect to the subject matter hereof and supersedes
all prior negotiations, understandings, agreements, and
representations. No amendment of this Agreement shall be binding or
of any effect unless in writing duly signed by both parties hereto.
<PAGE>
(d) This Agreement shall be binding upon and shall inure
to the benefit of the parties hereto and their respective successors
and assigns. This Agreement may be assigned by either party to a
successor in interest to all or substantially all of the assets or
business of the assigning party who shall promptly notify the other
party of the assignment of this Agreement. Any other assignment by a
party (except a collateral assignment by the Partnership to a
financial institution or lessor which makes available funds for the
Mobile Unit) shall require the prior written consent of either party,
which consent shall not be unreasonably withheld.
(e) No waiver by any party hereto of any default of or
breach by any other party under this Agreement shall operate as a
waiver of any future default or breach, whether of like or different
character or nature.
(f) Any notice required or permitted by this Agreement
shall be in writing and shall be deemed given at the time it is
deposited in the United States mail, postage prepaid, certified or
registered mail, return receipt requested, addressed to the party to
whom it is to be given as follows:
HOSPITAL: Edward White Hospital
2323 9th Avenue North
St. Petersburg, FL 33713
ATTN: Joel Snook
COMPANY: Medcross Imaging, Ltd.
3227 Bennet Street North
St. Petersburg, FL 33713
ATTN: Doree' Michon
Either party may change its address to which notices shall be sent by
a notice similarly sent.
(g) To the extent required by law, the Partnership hereby
agrees that for a period of four years after this Agreement
terminates, it shall make available upon written request of the
Secretary of Health and Human Services or upon request of the
Controller General or any duly authorized representative thereof, this
Agreement and the books, documents, and records that may be necessary
to certify the nature and extent of the costs related to this
Agreement with the Hospital and, furthermore, the Partnership agrees
that, if any of the value or cost of any work is provided pursuant to
a subcontract with a value of $10,000 or more, the Partnership shall
require that any such subcontractor sign a similar agreement to make
its books and records available for such four-year period of time.
(h) In the event of any litigation between the parties
arising out of or relating to this Agreement, the prevailing party
shall be entitled to recover all of its costs and expenses including,
but not limited to, reasonable attorneys' fees, including attorneys'
fees in all trials, appeals, and administrative proceedings.
<PAGE>
The parties hereto have executed this Agreement as of the 1st
day of October, 1995.
MEDCROSS IMAGING, LTD., a Florida limited partnership
BY: MEDCROSS, INC., General Partner
By: /s/ Doree Michon
As Vice President - Operations
EDWARD WHITE HOSPITAL, a
Florida corporation
By: /s/ Barry S. Stokes
As CEO
"HOSPITAL"
<PAGE>
EXHIBIT "A"
Schedule of Service
DAY TIME<F1>
Monday 7:00 a.m. - 6:00 p.m.
Wednesday 7:00 a.m. - 6:00 p.m.
Thursday<F2> 7:00 a.m. - 6:00 p.m.
Friday 7:00 a.m. - 6:00 p.m.
Saturday<F2> -----
<FN>
<F1>
1 See paragraph 7 regarding the terms of scheduled days of
service.
<F2>
2 Saturday and Thursday service is provided on an "as needed"
basis by the Partnership. The Partnership may terminate
Saturday or Thursday service at any time upon two-weeks notice
to the Hospital, and therefore, will not consider Saturday or
Thursday as a day of service for the purpose of calculating
the Daily Minimum Charges.<PAGE>
<S> <S>
</TABLE>
<TABLE>
AMENDED AND RESTATED
CONSULTING AGREEMENT
BY AND AMONG
MEDCROSS, INC.
KALO ACQUISITIONS, L.L.C.
AND
JASON H. POLLAK
THIS AGREEMENT (the "Agreement") is effective as of the 18th
day of October, 1995, by and among Medcross, Inc., a Florida
corporation with principal offices at 3227 Bennet Street North,
St. Petersburg, Florida 33713 (the "Corporation"), Jason H. Pollak
(hereinafter referred to as "Pollak" or the "Consultant" as the
context may require) and Kalo Acquisitions, L.L.C., a Delaware limited
liability Corporation with principal offices at 165 EAB Plaza, West
Tower, Suite 628, Uniondale, New York 11556-0165 ("Kalo").
WHEREAS, Kalo, through its manager and employees has developed
expertise in and is in the business of providing consulting services,
including finding and assessing acquisition candidates and providing
investor and public relations services;
WHEREAS, Pollak is the manager and an employee of Kalo, and
has expertise in the area of providing consulting services, including
finding and assessing acquisition candidates and providing investor
and public relations services;
WHEREAS, the Corporation desires to engage Pollak to provide
services to the Corporation as set forth below, upon the terms and
subject to the conditions set forth herein;
WHEREAS, Pollak desires to provide services to the Corporation
as set forth below, upon the terms and subject to the conditions set
forth herein;
WHEREAS, Kalo, Pollak and the Corporation have agreed that
Pollak shall render the services set forth below to the Corporation
upon the terms and subject to the conditions set forth herein; and
WHEREAS, Kalo has agreed to provide Pollak the opportunity to
avail himself of Kalo's resources including, without limitation, use
of any phone lines, computers, photocopiers, facsimile machines,
postage meters and other supplies in exchange for Pollak's
reimbursement to Kalo of the costs of the same.
NOW, THEREFORE, in consideration of the foregoing and for such
other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties hereto agree as follows:
1. Engagement. The Corporation hereby engages the Consultant to
render to it for a period of three (3) years commencing
February 1, 1996 (the "Term") the investor and public
relations services described herein. The Term hereof may be
renewed upon the written agreement of the Corporation, Kalo
and the Consultant entered into prior to expiration of the
<PAGE>
initial Term hereof on such terms as the parties hereto may
negotiate at the time of such renewal.
2. Services. For the Term of this Agreement, the Consultant
shall perform the following services for the Corporation:
(a) Assist the Corporation in locating, assessing and
implementing the acquisition by the Corporation, by way of
private or open market purchases of stock, purchase of
assets, merger, tender offer, joint venture or otherwise,
the acquisition by the Corporation of one or more
businesses, divisions or other operating entities and/or
assets, including without limitation thereto Image Trust,
consistent with the directives of the Corporation;
(b) Prepare and distribute, with the Corporation's prior
approval, due-diligence packages for the brokerage
community which would include presentation folders, press
release sheets and a Corporation overview pamphlet;
(c) Prepare and distribute, with the Corporation's prior
approval, investor relations packages;
(d) Coordinate broker presentations to be held a minimum of
four (4) times per year;
(e) Prepare and disseminate, with the Corporation's prior
approval, information about the Corporation to investors;
(f) Present and introduce the Corporation to broker/dealers,
fund managers and analysts on a continual basis;
(g) Prepare and disseminate, with the Corporation's prior
approval, press releases in compliance with any applicable
regulatory guidelines to wire/news services;
(h) Disseminate for informational purposes the Corporation's
publicly filed materials, including the Corporation's
Annual and Quarterly Reports on Form 10-KSB and Form
10-QSB, respectively, to investors;
(i) Assist with the set up of annual and special shareholder
meetings;
from time to time by the officers of the Corporation;
(k) Reimburse Kalo for its costs related to the use of any of
its resources as contemplated herein;
<PAGE>
(l) Locate and introduce at least ten (10) broker/dealers
and/or market makers to the Corporation to make a market
in the Corporation's securities; and
(m) Bear all costs and expenses relating to any of the
foregoing.
3. Compensation. In consideration for the performance of the
services described above, the Corporation shall issue to the
Consultant an option exercisable to purchase an aggregate of
up to one hundred fifty thousand (150,000) shares of its
common stock, par value $.007 per share (the "Common Stock"),
which option (the "Option") shall be exercisable as set forth
below and shall expire on January 31, 1999:
(a) commencing on February 1, 1996, the Option shall become
exercisable to purchase up to fifty thousand (50,000)
shares of Common Stock at an exercise price of one dollar
and fifty cents ($1.50) per share;
(b) commencing on February 1, 1997, the Option shall become
exercisable to purchase an additional fifty thousand
(50,000) shares of Common Stock at an exercise price of
two dollars and fifty cents ($2.50) per share; and
(c) commencing on February 1, 1998, the Option shall become
exercisable to purchase an additional fifty thousand
(50,000) shares of Common Stock at an exercise price of
three dollars and fifty cents ($3.50) per share.
4. Registration Rights. The Corporation shall file,
contemporaneously with or as soon as practicable after
execution hereof, a registration statement relating to the
shares of Common Stock issuable pursuant hereto on Form S-8
with the Securities and Exchange Commission (the "Commission")
pursuant to the Securities Act of 1933 (the "Act"). In the
event that, for any reason whatsoever, such Form S-8 is not
available for use by the Corporation, the Corporation shall
file such form of registration statement as is available for
use by the Corporation as specified or otherwise permitted by
the Act and the rules and regulations promulgated thereunder.
The Corporation shall bear the expenses of such registration
and shall: (a) provide any requisite prospectuses meeting the
requirements of the Act and such other documents as the
Consultant may reasonably request for a period of at least
twelve (12) months following expiration of the Option in order
to facilitate the sale or other disposition of such
securities; (b) register and qualify for sale any of such
securities in such states as the Consultant may reasonably
designate; and (c) do any and all other acts and things which
may be necessary or desirable to enable the Consultant to
consummate the sale or other disposition of such securities.
The Consultant hereby acknowledges that it understands that:
(a) neither the Option nor the shares of Common Stock issuable
upon exercise thereof have previously been the subject of
registration under the Act or any applicable state
securities laws;
<PAGE>
(b) the Consultant may not sell or otherwise transfer the
Option or the shares of Common Stock issuable upon
exercise of the Option unless such securities are subject
to an effective registration statement under the Act and
any applicable state securities laws (unless exemptions
from such registration requirements are available);
(c) in the event that any shares of Common Stock issuable
pursuant to exercise of the Option are issued at a time
during which a registration statement relating to the same
is not effective, until such shares of Common Stock are
subject to an effective registration statement under the
Act, a legend will be placed on any certificate or
certificates evidencing the same indicating that the
transfer of such securities has not been registered under
the Act and setting forth or referring to the restrictions
on transferability and sales of such securities; and
(d) the Corporation will place stop transfer instructions
against the certificate or certificates evidencing the
securities issuable pursuant hereto to restrict the
transfer thereof.
5. Representations and Warranties. The Consultant hereby
represents and warrants that:
(a) the Consultant will not sell or otherwise transfer the
Option or the shares of Common Stock issuable upon
exercise of the Option without compliance with the Act and
any applicable state securities laws;
(b) the Consultant has received and carefully read the
following: (i) the Corporation's Annual Report on Form
10-KSB for the period ended December 31, 1994 (File No.
0-17973); (ii) the Corporation's Quarterly Reports on Form
10-QSB for the periods ended March 31, 1995, June 30, 1995
and September 30, 1995 (File No. 0-17973); and (iii)
written or verbal responses for all questions the
Consultant has submitted to the Corporation regarding its
acquisition of the securities described herein, all of
which the Consultant acknowledges have been provided to
the Consultant (the "Corporate Materials"). The
Consultant has not been furnished with any other materials
or literature relating to the acquisition of the
securities described herein, other than the Corporate
Materials. The Consultant has been given the opportunity
to ask questions of and to receive answers from the
Corporation concerning the terms and conditions of the
acquisition of the securities described herein and the
Corporate Materials, and to obtain such additional written
information necessary to verify the accuracy of same as
the Consultant desires in order to evaluate the
acquisition of and investment in the securities described
herein. The Consultant acknowledges and confirms that the
written and/or verbal responses provided to the Consultant
by the Corporation in response to the Consultant's
questions are not contrary to or inconsistent with, nor do
they in any way conflict with the information set forth in
the Corporate Materials. The Consultant further
acknowledges that it fully understands the information
contained in the Corporate Materials and the Consultant
has had the opportunity to discuss any questions regarding
<PAGE>
the Corporate Materials with its counsel or other advisor.
Notwithstanding the foregoing, the only information upon
which the Consultant has relied is that set forth in the
Corporate Materials and that derived by its own
independent investigation. The Consultant acknowledges
that the Consultant has received no representations or
warranties from the Corporation or its employees or agents
in making an investment decision related to the
acquisition of the securities described herein, other than
as set forth herein;
(c) the Consultant is aware that the acquisition of the
securities described herein is a speculative investment
involving a high degree of risk and that there is no
guarantee that the Consultant will realize any gain from
its acquisition of or investment in such securities. The
Consultant has specifically reviewed the Corporate
Materials with a view toward acquiring the securities
described herein;
(d) the Consultant understands that no federal or state agency
or other authority: (i) has made any finding or
determination regarding the fairness of the transactions
described herein, (ii) has made any recommendation or
endorsement of the transactions described herein, or
(iii) has passed in any way upon this agreement or the
Corporate Materials;
(e) the Consultant: (i) is acquiring the securities described
herein solely for his own account for investment purposes
only and not with a view toward resale or distribution
thereof, either in whole or in part; and (ii) has no
contract, undertaking, agreement or other arrangement, in
existence or contemplated, to sell, pledge, assign or
otherwise transfer the securities to any other person;
(f) the Consultant has adequate means of providing for his
current needs and contingencies and has no need for
liquidity in the investment in the securities described
herein. The Consultant has read, is familiar with and
understands Rule 501 of Regulation D and represents that
he is an "accredited investor" as defined in Rule 501(a)
of Regulation D under the Act. The Consultant has no
reason to anticipate any material change in his financial
condition for the foreseeable future;
(g) the Consultant is financially able to bear the economic
risk of an investment in the securities described herein,
including the ability to hold such securities indefinitely
and to afford a complete loss of an investment in such
securities;
(h) the Consultant's overall commitment to investments which
are not readily marketable is not disproportionate to the
Consultant's net worth, and the Consultant's investment in
the securities described herein will not cause such
overall commitment to become excessive. The Consultant
understands that the statutory basis on which such
securities are being issued to the Consultant would not be
available if the Consultant's present intention were to
hold such securities for a fixed period of time or until
the occurrence of a certain event. The Consultant
realizes that, in the view of the Commission, the
<PAGE>
acquisition of such securities now with a present
intention to resell by reason of a foreseeable specific
contingency or any anticipated change in the market value
of such securities, or in the condition of the Corporation
or that of the industry in which the business of the
Corporation is engaged or in connection with a
contemplated liquidation, would, in fact, constitute an
acquisition and/or purchase with an intention inconsistent
with the Consultant's representations to the Corporation
and the Commission would then regard such purchase as a
purchase for which the exemption from registration under
the Act relied upon by the Corporation in connection
herewith is not available; and
(i) the Consultant has such knowledge and experience in
financial and business matters as to be capable of
evaluating the merits and risks of the acquisition of and
an investment in the securities described herein.
6. Confidential Information. The parties hereto recognize that
it is fundamental to the business and operation of the
Corporation, its subsidiaries, affiliates and divisions
thereof to preserve the specialized knowledge, trade secrets,
and confidential information of the foregoing entities. The
strength and good will of the Corporation is derived from the
specialized knowledge, trade secrets, and confidential
information generated from experience through the activities
undertaken by the Corporation, its subsidiaries, affiliates
and divisions thereof. The disclosure of any of such
information and the knowledge thereof on the part of
competitors would be beneficial to such competitors and
detrimental to the Corporation, its subsidiaries, affiliates
and divisions thereof, as would the disclosure of information
about the marketing practices, pricing practices, costs,
profit margins, design specifications, analytical techniques,
concepts, ideas, process developments (whether or not
patentable), customer and client agreements, vendor and
supplier agreements and similar items or technologies. By
reason of performance under this Agreement, the Consultant may
have access to and may obtain specialized knowledge, trade
secrets and confidential information such as that described
herein about the business and operation of the Corporation,
its subsidiaries, affiliates and divisions thereof.
Therefore, the Consultant hereby agrees that he shall keep
secret and retain in confidence and shall not use, disclose to
others, or publish, other than in connection with the
performance of services hereunder, any information relating to
the business, operation or other affairs of the Corporation,
its subsidiaries, affiliates and divisions thereof, including
but not limited to, confidential information concerning the
marketing practices, pricing practices, costs, profit margins,
products, methods, guidelines, procedures, engineering designs
and standards, design specifications, analytical techniques,
technical information, customer, client, vendor or supplier
information, employee information, or other confidential
information acquired by each of them in the course of
providing services for the Corporation. The Consultant agrees
to hold as the Corporation's property all notes, memoranda,
books, records, papers, letters, formulas and other data and
all copies thereof and therefrom in any way relating to the
business or operation of the Corporation, its subsidiaries,
affiliates and divisions thereof, whether made by the
Corporation or the Consultant or as may otherwise come into
the possession of the Consultant. Upon termination of this
Agreement or upon the demand of the Corporation, at any time,
the Consultant shall deliver the same to the Corporation
within twenty-four (24) hours of such termination or demand.
<PAGE>
7. Reformation. In the event that a court of competent
jurisdiction determines that the confidentiality provisions or
part of a provision hereof are unreasonably broad or otherwise
unenforceable because of the length of their respective terms
or the breadth of their territorial scope, or for any other
reason, the parties hereto agree that such court may reform
the terms and/or scope of such covenants so that the same are
reasonable and, as reformed, shall be enforceable.
8. Applicable Law. This Agreement shall be construed and
enforced in accordance with the laws of the State of Florida
without regard to the principles of conflicts of laws thereof
and shall inure to the benefit of and be binding upon Kalo,
the Consultant and the Corporation and their respective legal
successors and assigns.
9. Remedies. In the event of a breach of any of the provisions
of this Agreement, the non-breaching party shall provide
written notice of such breach to the breaching party. The
breaching party shall have thirty (30) days after receipt of
such notice in which to cure its breach. If, on the
thirty-first (31st) day after receipt of such notice, the
breaching party shall have failed to cure such breach, the
non-breaching party thereafter shall be entitled to seek
damages. It is acknowledged that this Agreement is of a
unique nature and of extraordinary value and of such a
character that a breach hereof by the Consultant or the
Corporation shall result in irreparable damage and injury for
which the non-breaching party may not have any adequate remedy
at law. Therefore, if, on the thirty-first (31st) day after
receipt of such notice, the breaching party shall have failed
to cure such breach, the non-breaching party shall also be
entitled to seek a decree of specific performance against the
breaching party, or such other relief by way of restraining
order, injunction or otherwise as may be appropriate to ensure
compliance with this Agreement. The remedies provided by this
section are non-exclusive and the pursuit of such remedies
shall not in any way limit any other remedy available to the
parties with respect to this Agreement, including, without
limitation, any remedy available at law or equity with respect
to any anticipatory or threatened breach of the provisions
hereof.
10. No Continuing Waiver. The waiver by any party of any
provision or breach of this Agreement shall not operate as or
be construed to be a waiver of any other provision hereof or
of any other breach of any provision hereof.
11. Notice. Any and all notices from either party to the other
which may be specified by, or otherwise deemed necessary or
incident to this Agreement shall, in the absence of hand
delivery with return receipt requested, be deemed duly given
when mailed if the same shall be sent to the address of the
party set out on the first page of this Agreement by
registered or certified mail, return receipt requested, or
express delivery (e.g., Federal Express).
12. Severability of Provisions. The provisions of this Agreement
shall be considered severable in the event that any of such
provisions are held by a court of competent jurisdiction to be
invalid, void or otherwise unenforceable. Such invalid, void
or otherwise unenforceable provisions shall be automatically
replaced by other provisions which are valid and enforceable
and which are as similar as possible in term and intent to
those provisions deemed to be invalid, void or otherwise
<PAGE>
unenforceable. Notwithstanding the foregoing, the remaining
provisions hereof shall remain enforceable to the fullest
extent permitted by law.
13. Assignability. This Agreement shall not be assignable without
the prior written consent of the non-assigning party or
parties hereto and shall be binding upon and inure to the
benefit of any heirs, executors, legal representatives or
successors or permitted assigns of the parties hereto.
14. Entire Agreement; Amendment. This Agreement contains the
entire agreement among the Corporation, Kalo and the
Consultant with respect to the subject matter hereof. This
Agreement may not be amended, changed, modified or discharged,
nor may any provision hereof be waived, except by an
instrument in writing executed by or on behalf of the party
against whom enforcement of any amendment, waiver, change,
modification or discharge is sought. No course of conduct or
dealing shall be construed to modify, amend or otherwise
affect any of the provisions hereof.
15. Headings. The paragraph headings contained in this Agreement
are for reference purposes only and shall not in any way
affect the meaning or interpretation of the provisions of this
Agreement.
16. Termination. The Corporation may terminate this Agreement
with or without cause at any time upon delivery of thirty (30)
days prior written notice to the other parties hereto. Any
such termination shall result in the termination of the
Consultant's respective rights to receive any further
compensation, except with respect to accrued compensation
which Consultant shall have the right to receive
notwithstanding termination hereof.
17. Survival. Sections 5, 6, 7, 8, 11 and 12 shall survive the
termination for any reason of this Agreement (whether such
termination is by the Corporation, upon the expiration of this
Agreement by its terms or otherwise).
* * * * *
<PAGE>
IN WITNESS WHEREOF, the parties have caused this Agreement for
Consulting Services to be executed and delivered by their duly
authorized officers as set forth below and have caused their
respective corporate seals to be hereunder affixed as of the date
first above written.
MEDCROSS, INC.
By:/s/ Henry Y.L. Toh
Henry Y.L. Toh, President
KALO ACQUISITIONS, L.L.C.
By:/s/ Jason H. Pollak
Jason H. Pollak, Manager
THE CONSULTANT
/s/ Jason H. Pollak
Jason H. Pollak
<S> <S>
</TABLE>
