Management Services Agreement

MANAGEMENT SERVICES AGREEMENT


This Management Services Agreement is made as of 11:59 p.m. September 30, 2003 ("Effective Date") between Caprius, Inc., (the "Provider") and Strax Institute, Inc., (the "Manager").


W I T N E S S E T H :


WHEREAS, the Provider is in the business of providing mammography and bone densitometry services in the State of Florida ("Provider Services"); and


WHEREAS, the Manager owns assets and employs personnel that Provider can utilize to furnish mammography services, and further, Manager has expertise in the management and administration of mammography providers; and


WHEREAS, the Provider desires to engage the Manager to provide, and the Manager agrees to provide, (i) the space, equipment and personnel necessary for Provider to furnish mammography and bone densitometry services; and (ii) administrative services (collectively, "Manager Services"), on the terms and conditions hereinafter described.


NOW, THEREFORE, in consideration of the mutual covenants and agreements herein contained, and for other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, and on the terms and subject to the conditions herein set forth, the parties hereto hereby agree as follows:


ARTICLE 1


SERVICES TO BE PROVIDED BY THE MANAGER


SECTION 1.1 LEASE OF SPACE AND PROVISION OF SUPPLIES AND EQUIPMENT. During the Term, the Manager hereby agrees to provide to the Provider for its provision of the Provider Services, the office space described on Exhibit A attached hereto (the "Premises"). The Manager shall be responsible for all costs in connection with the rent, maintenance, utilities, repairs and real estate taxes incurred in connection with, and all such other expenses associated with, the operation of the Premises.


1.1.1 The Provider shall use the Premises only for the provision of the Provider Services. The Provider shall comply with all applicable rules and regulations of governmental bodies having jurisdiction over the Provider with respect to the provision of the Provider Services at the Premises.


1.1.2 The Manager, at its cost, has agreed to provide the furniture, fixtures and furnishings at the Premises listed on Schedule A-1 attached hereto (the "Furniture").


1.1.3 The Manager shall provide to the Provider, at its cost, for use at the Premises, all medical equipment reasonably necessary to accommodate the Provider's provision of the Provider Services (collectively, the "Equipment"). The Equipment at the Premises as of the date hereof is described on Schedule A-2 attached hereto. The Manager shall arrange and pay for necessary maintenance and servicing of the Equipment either through maintenance contracts or on an "as needed" basis. If any items of Equipment, from time to time, become worn out, lost, destroyed, damaged beyond repair or otherwise rendered unfit for use, then the Manager shall within a reasonable time repair or replace or cause to be repaired or replaced such items; provided, however, that if the repair or replacement of such item is due in whole or in part to the negligence, willful misconduct of the Provider or the Provider's failure to use the Equipment in conformity with procedures and instructions provided to it by the Manager or by the manufacturers of such Equipment, such repair or replacement shall be at the sole expense of the Provider, which shall promptly pay same or otherwise reimburse the Manager on demand therefor. No such replacement or repaired item of Equipment shall become the property of the Provider, and each item of replacement or repair shall be subject to this Agreement for all purposes.


1.1.4 The Manager, at its cost, shall provide supplies as required by the Provider to furnish the Provider Services at the Premises. Such supplies shall be provided and paid for by the Manager.


1.1.5 The Manager, at its cost, shall provide the Provider with the use of one or more telephone and fax numbers in connection with the provision of the Provider Services at the Premises.


1.1.6 The Manager, at its cost, shall provide the employees listed on Schedule A-3 attached hereto.


SECTION 1.2 APPOINTMENT OF THE MANAGER AS MANAGER AND ADMINISTRATOR. The Provider hereby appoints the Manager to be the sole and exclusive manager and administrator of the administrative functions and services associated with the Provider's provision of the Provider Services at the Premises and the Manager accepts such appointment.


SECTION 1.3 BILLING, COLLECTION AND ACCOUNTS PAYABLE SERVICES.


1.3.1 In the name of and on behalf of the Provider, the Manager shall be responsible for billing the Provider's Medicare patients, and for collecting from such patients the fees of the Provider for its provision of the Provider Services to such patients at the Premises. In this connection, the Provider appoints the Manager for the Term as its true and lawful attorney-in-fact for the following purposes:


(1) To bill patients to whom the Provider has provided the Provider Services; provided, however, that the Manager, in billing third party payors, shall render such bills in accordance with all applicable rules, regulations and policies of such payors;


(2) To collect accounts receivable generated by billings done in the name of the Provider relating to the Provider Services provided or to be provided by the Provider, whether from patients or from third party payors on behalf of patients; provided, however, that such obligation does not encompass the institution of collection proceedings by the Manager; and


(3) To receive payments from whatever source for the provision of the Provider Services by the Provider at the Premises.


1.3.2 In no event shall the Manager have any control over or responsibility for the establishment or determination of the fees charged by the Provider.


1.3.3 The Manager shall pay, in the name of and on behalf of the Provider, all bills and expenses incurred by the Provider to render the Provider Services at the Premises.


SECTION 1.4 ADMINISTRATIVE SERVICES.


1.4.1 The Manager, subject to the ongoing supervision and control of the Provider, shall conduct, manage, and coordinate all business and administrative aspects of the Provider's provision of the Provider Services to patients at the Premises. In connection therewith, the Manager shall supply to the Provider the ordinary, necessary, or appropriate services for the efficient provision of the Provider Services at the Premises, including, without limitation, necessary clerical, accounting, purchasing, payroll, legal, bookkeeping, banking and computer services, information management, printing, postage and duplication services and medical transcribing services.


1.4.2 All funds collected from patients receiving Provider Services at the Premises shall be deposited in one or more bank accounts established by Provider in the name of Provider.


1.4.3 On behalf of the Provider, which shall own same, during the Term, the Manager shall maintain all files and records relating to the provision of the Provider Services at the Premises, including, but not limited to, accounting, billing, collection and customary financial records and patient files. The Manager shall ensure that all files and records shall be located in an area on the Premises so that they are readily accessible for patient care, consistent with or ...