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.
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
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;
(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.
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.
(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.
(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
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.
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.
(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.
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"
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>