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EXHIBIT 10.47
PROFESSIONAL SERVICES AGREEMENT
THIS PROFESSIONAL SERVICES AGREEMENT (This "Agreement) is made, entered into on
the 17 day of November, 1998 by and between NATIONAL DIAGNOSTICS, Inc., a
Florida corporation (the "Company") and NAVIX MSO PUNTA GORDA, INC., a Florida
corporation whose address is 0000 X. Xxxxxxxx Xxxxx, Xxxxxxx Xxxxx, Xxxxxxx
00000 ("Navix").
RECITALS
WHEREAS, the Company operates out-patient medical and health care facilities at
the following address: Sun Point Diagnostic Center, 0000 Xxxxx Xxxx 000, Xxxxxx,
XX 00000 and Brandon Diagnostic Center, 000 Xxxx Xxxxxxx Xxxx., Xxxxxxx, XX
00000 (collectively the "Centers" or individually "Center") offering a variety
of diagnostic medical equipment as may be acquired from time to time hereafter
(the "Diagnostic Equipment"); and
WHEREAS, Navix and/or its Affiliates employs or contracts with various
radiologists licensed to practice medicine in the State of Florida who are
qualified to perform professional diagnostic services at the Centers; and
WITNESSETH:
NOW, THEREFORE, In consideration of the premises, the mutual agreements
contained herein and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Parties represent, warrant,
undertake, covenant and agree as follows:
1. Incorporation of Recitals. The recitals set forth above are true and correct
and are hereby incorporated into this Agreement.
2. Engagement of Navix. The Company hereby engages, on an exclusive basis, Navix
and Navix hereby agrees to be engaged by the Company, as an independent
contractor to provide radiological services at the Center, and any other site at
which the Company provides diagnostic imaging services if Navix and Company
mutually agree pursuant to section 6(d) below, in accordance with the terms and
conditions hereinafter set forth.
3. Terms of Agreement. The term of this Agreement shall begin as of January 2,
1999 and shall terminate on the last day of the same calendar month in 2004, at
which time a new agreement may be negotiated between the parties. If the Company
sells all or substantially of the assets at a Center or otherwise merges,
consolidates, enters into a share exchange or any similar transition during the
term of this Agreement, this Professional Services Agreement shall continue in
full force and effect and Company shall cause the acquirer of assets or shares
to acknowledge in writing its agreement to perform all of the Company's
obligations under this Agreement.
4. Responsibilities and Duties of Navix. During the Term, Navix shall have the
following duties and responsibilities:
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a. Provision of Physicians. The professional medical services to be
performed by Navix shall be performed by physicians employed by or under
contract with Navix or its Affiliates, and such physicians shall be reasonably
acceptable to Company (the "Physicians"). Navix shall provide the appropriate
Physician radiologist coverage at the Centers as required during the Center's
normal hours of operation. Navix shall have the Physicians provide emergency
on-call coverage one hour before the beginning of the normal working day and/or
one hour after the conclusion of the normal working day, but the Physicians
shall not be on call during the evening and night for emergency procedures
unless agreed in writing by Navix. Normal working hours will be as mutually
agreed between the parties. Any changes in hours of Physician radiological
coverage for the Centers shall be discussed between Company and Navix in advance
of any change in required Physician radiological coverage. It is agreed that if
the volume and workload of the business of the Center justify additional
Physician radiological coverage, Navix shall provide such coverage. Such
additional coverage may be required if the RVUs per Physician exceed 18,000 per
year. Company and Navix shall mutually agree on the scheduling of the hours of
additional Physician radiologist coverage. Navix shall assure that all
Physicians employed shall comply with all of the terms and provisions of this
Agreement when performing professional services at the Center. Navix and all
such Physicians employed by Navix and rendering services to patients utilizing
the Center shall be board certified or board eligible physicians trained in
radiology, capable of utilizing the Center's diagnostic equipment and
interpreting examinations and readings performed at the Center and licensed by
the State of Florida, who have the competence and capacity to supervise the
operation of the Diagnostic Equipment and to interpret Diagnostic Images and
data derived therefrom. Navix shall not provide coverage in any other manner
without the prior written approval of the Company.
b. Read and Interpret Diagnostic Images. Navix (or Physician employees
or contractors of Navix or its Affiliates) shall read, examine and interpret all
of the Diagnostic Images of the Center's patients. After examination of the
Diagnostic Images, Navix (or Physician employees or contractors of Navix or its
Affiliates) shall interpret Diagnostic Images and dictate a report, detailing
the interpretation of the Diagnostic Images which will be provided to the
Company and contain such information as the Company shall reasonably request
from time to time. The reports shall be dictated and made available to the
Company for processing on all studies performed each day prior to the Physician
departing the Center, except in emergencies or on occasions when reasonable
radiological practice justifies a later dictation of a report. The Company shall
direct the clerical typing, transcription and distribution of the written
reports based on the utilization of its own resources, facilities and staff and
staff personnel, at its own cost and expense.
c. Certain Related Medical Matters. Physician employees or contractors
of Navix or its Affiliates shall use the Company's medical equipment and
supplies in a careful and professional manner in accordance and in compliance
with currently acceptable medical standards and ethics, all applicable statutes,
ordinances, regulations and orders, and all instructions or manuals of the
manufacturers and vendors of the Diagnostic Equipment.
d. Compliance with Rules, Regulations and Policies. Physician employees
or contractors of Navix or its Affiliates shall provide professional services in
a careful manner and shall satisfy the requirements of any standards, rulings or
regulations of any governmental agency or regulatory body, having authority to
administer, regulate, accredit or otherwise establish standards for diagnostic
imaging and radiology at the Center, including but not limited to, those
relating to the ability to operate the Diagnostic Equipment and interpret
Diagnostic Images produced thereby. The Company will not supervise the actual
performance of professional services by Navix or its Physician employees or
contractors. However, all Navix Physicians physically at the Center shall comply
with this Agreement, and all
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reasonable rules, regulations and policies adopted by the Company from time to
time including the scheduling of patients and various employees and staff at the
Center with respect to of medical services and patient safety. Navix shall be
responsible for supervision of examinations, updating of technical protocols and
shall participate in Company's quality assurance program. Navix will also
provide a Physician qualified to act as a Radiation Safety officer.
5. Duties of the Company. During the Term, the Company shall fulfill the
following duties and obligations:
a. Medical Equipment. The Company shall be responsible for providing
all Diagnostic Equipment at each Center, in consultation with Navix as to what
is reasonable, necessary or desirable and, at its expense, shall cause all of
such Diagnostic Equipment to be maintained in good working order and repair.
Company shall also furnish all supplies and expendable equipment such as films
and chemicals, and furnish all required janitorial service, hazardous waste
disposal, laundry service and telephone service. The Company shall provide all
necessary radiation safety and quality control equipment. The Company shall make
available, through its Affiliates or otherwise, suitable office space for the
Physicians to perform their professional services pursuant to this Agreement.
b. Staff the Center. The Company shall, at its expense, employ such
clerical, technical and other employees as are necessary for the operation of
the Centers and the Company's business and as are necessary to support the
professional services of the Physicians performing professional services at each
Center.
c. Billing and Collections. The Company shall be responsible for
arranging for the billing and collection for all fees due the Company and
services performed at the Center including, but not limited to, the services
performed by Navix and its Physicians in accordance with its standard billing
and collection policies and practices. The Company represents that it has all
provider numbers, licenses, permits and other governmental approvals to xxxx and
receive reimbursement for all services performed at the Centers and conduct
business at the Centers. The Company shall act as the agent of Navix with
respect to the billing and collection of the professional fees for services at
each Center. In such billing, the Company may indicate on its xxxx that it is
billing in the name of Navix, its Affiliate or the Physician, as applicable. The
Company shall not, however, be required to initiate suit to obtain payment
except in accordance with its standard policies and procedures. All patients who
receive medical services at the Centers shall be billed on a "global", fee basis
which shall include the fees for both Physician medical services and for the
services rendered by the Company. The Company shall provide Navix with copies of
all bills which it renders, which include billing for services of the
Physicians. Such copies to be provided at the time each xxxx is sent out for
payment. In addition, the Company shall provide Navix with a monthly summary of
Navix's and/or the Physician's xxxxxxxx. To allow Company to xxxx and collect
for Navix and its Physicians, Navix hereby appoints the Company (and to the
extent necessary Navix will cause its Affiliates and/or Physicians to also grant
Company a power of attorney), irrevocably and exclusively during the Term, and
for so long thereafter as is necessary to effect the purposes of this section of
this Agreement, as Navix's true and lawful attorney-in-fact coupled with an
interest for the following purposes:
To xxxx patients on behalf of Navix;
(ii) To collect accounts receivable generated by such xxxxxxxx on
Navix's behalf;
(iii) To receive all payments on behalf of Navix from insurance
companies and all other third-party payers;
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(iv) To take possession of and endorse in the name of Navix any notes,
checks, money orders, insurance payment, or any other instruments received in
payment of the accounts receivable generated under this Agreement; and
(v) To compromise and settle amounts owed for diagnostic services by
third parties to the Company in accordance with Company's standard billing and
collection policies and practices.
The Company, will provide Navix with a monthly summary of billing and
collection activity or when reasonably requested by Navix. Any checks or other
instruments received by Navix for services rendered pursuant to this Agreement
shall either be endorsed over to the Company or negotiated by Navix and the
proceeds thereof immediately delivered to the Company for application in
accordance with the provisions of this Agreement.
6. Professional Fees. The Company will pay to Navix during the term, payable on
the twenty-fifth (25th) day of the month after the month end on the pervious
month's receipts, the following amounts:
a. Fourteen percent (14%) of the aggregate gross receipts received by
the Company after January 1, 1999 and each month thereafter, minus refunds and
minus fees for services not requiring a radiological reading or interpretation,
or on any other diagnostic study or procedure added after January 2, 1999 to the
array of radiological services offered by the Centers which Navix physicians do
not provide supervision or interpretation, for example:
January monthly aggregate gross receipts = $500,000.00
1,000.00 (refunds)
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$499,000.00 X 14% = $69,860.00
(payable to Navix on or before
February 25th)
b. As an advance against compensation payable for the month of January
1999, the Company has agreed to pay Navix $25,000 no later than January 25,
1999. Such advance shall be reconciled against the compensation actually due to
Navix for the month of January 1999 as determined on or before February 25,
1999.
c. If this Agreement is canceled or terminated for any reason National
Diagnostics, Inc., will have the right to continue to xxxx and collect for all
Physician services performed under this Agreement and remit any balance to
Navix.
d. The Company will utilize Navix's professional services on all new
locations for diagnostic imaging services provided by the Company or its
Affiliates, if mutually agreeable to the parties.
7. Malpractice Insurance. At all times during the Term, Navix shall maintain
professional insurance coverage to insure against risks encountered in the
course of its Physicians' duties under this Agreement in amount of not less than
$1,000,000.00 per occurrence and $3,000,000.00 in the aggregate on an annual
basis. Navix shall obtain this insurance from a reputable insurance company and
in a form reasonably satisfactory to the Company and shall provide the Company
with a certificate of such insurance coverage prior to the commencement of this
Agreement and at any subsequent date during the Term at the company's reasonable
request. Navix shall provide the Company with written notice at least thirty
(30) days prior to any cancellation or reduction of such insurance. Navix will
evidence to the Company on an
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annual basis at Company's reasonable request that the insurance coverage
required by this Section is in full force and effect. Any cancellation or
reduction of insurance coverage from the amount set forth above without the
prior written approval of the Company shall constitute a material breach of the
provisions of this Agreement. In case of illness, emergency, vacation, or
continuing education requirements, Navix shall provide coverage and appropriate
malpractice insurance coverage of the attending radiologist unless this
radiologist is contracted with a Locum Tenens company which shall provide
appropriate malpractice insurance coverage and written verification of that
coverage as required by this paragraph 7.
a. Policies and Procedures. The Company shall have the authority to
determine who will be accepted as patients at the Center. The Company will not
supervise the actual performance of professional services by Navix or its
Physicians. However, while utilizing the facilities of the Company and while
physically at the Center, Navix Physicians shall comply with the professional
policies and procedures established by the management of the Center, and shall
otherwise conduct themselves in a professional manner. Navix and its Physicians
shall have the right of access to, and review of, the professional, technical,
and managerial policies and procedures established by the management of the
Center.
8. Intentionally omitted.
9. Termination.
a. Termination by the Company. Subject to the applicable cure period,
the Company may immediately terminate this Agreement for "good cause". The term
"good cause" shall mean any of the following acts or inactions on the part of
Navix or its Physicians in the performance of services under this Agreement:
(i) Willful violation of laws or regulations related to the services
performed hereunder other than for Force Majeure events;
(ii) Material breach of performance of this Agreement, including the
intentional failure to perform stated duties in this Agreement;
(iii) Gross negligence in the performance of duties under this
Agreement;
(iv) The revocation by the Florida Department of Professional
Regulation or other regulatory or governmental body of Navix's or its
Physicians, license to practice medicine in the State of Florida;
(v) Navix's or its Physicians failure to abide by or comply with the
reasonable professional practices, policies, rules, and regulations adopted by
the Company for professional services rendered at the Center;
(vi) Failure to maintain the required malpractice liability insurance
required by Section 7 of this Agreement;
(vii) Conviction of a crime involving moral turpitude;
(viii) Substantial dependence of a Physician, as determined by a
medical specialist in substance abuse not affiliated with Company, on any
addictive substance, including but not limited to alcohol, amphetamines,
barbiturates, LSD, or narcotic drugs.
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b. Termination by Navix. Navix may terminate this Agreement immediately
upon notice for "good cause". The term "good cause" in this section shall mean
any of the following acts or inactions on the part of the Company or its key
executive officers:
(i) Willful violation of laws or regulations;
(ii) Material breach of performance of this Agreement;
(iii) Practices which materially place the patients or Physicians at
risk of injury and/or Navix or its Physicians at undo risk for malpractice
liability or sanction or condemnation by any governmental or regulatory body.
In addition, upon one hundred twenty (120) days prior written notice,
Navix may terminate this Agreement if the Professional Fee paid by Company to
Navix during the second year or any year thereafter during the term of this
Agreement are not equal to at least $300,000 per year, per Physician performing
services at the Center.
Notwithstanding the foregoing, in the event of good cause termination
under paragraph 9(a), Navix may cure such event by (a) giving proof to the
Company in a form reasonably satisfactory to the Company that the Physician who
caused any of the events identified in the subparts to 9(a) had been removed
from the Center and replaced by a Physician reasonably acceptable to the Company
that has been employed to render services at the Center, or (b) in the case of
Navix, that Navix has cured such breach or default, in each case within thirty
(30) days of the Company's notice of termination to Navix in which case such
termination notice shall be of no force or effect.
c. Termination by Mutual Consent. This Agreement may be terminated at
any time with the mutual consent of the parties. This Agreement may be
terminated by a party at anytime without cause upon 180 days prior written
notice.
10. Intentionally deleted.
11. Status as Independent Contractor. Navix understands and agrees that Navix is
not and will not be considered an employee of the Company and the Company will
not withhold income, Social Security, unemployment or any other taxes from the
amounts paid to Navix and that the payment of such taxes shall be the sole
responsibility of Navix.
Navix shall not be entitled to worker's compensation, unemployment
compensation or any other statutory benefit or right predicted on an
employer-employee-relationship. This Agreement shall not be construed as
creating an employer-employee relationship between the Company and Navix and the
parties understand that each are independent contractors. The Company will not
carry worker's compensation coverage or pay Florida unemployment compensation
taxes in view of Navix's relationship with the Company as an independent
contractor. It is further understood and agreed that the Company is not
responsible for the payment of any expenses incurred by Navix in performing the
services contemplated by the Agreement.
12. Access to Books and Reports. Navix acknowledges and agrees that applicable
federal and/or state laws, rules or regulations require that Navix allow the
Company and applicable regulatory agencies access to Navix's books and records
as they relate to the services provided pursuant to this Agreement.
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Accordingly, Navix hereby grants to the Company the right to examine, at all
reasonable times, all of the books and records of Navix relating to the
provision of professional services pursuant to this Agreement, and Navix shall
maintain such books and records in an orderly fashion at its offices or such
other place reasonably acceptable to Company readily accessible to the Company.
Likewise, the Company hereby grants to Navix the right to examine, at all
reasonable times, all of the books and records of the Center relating to
operations, policies, procedures, technological services, and billing and
collection procedures and data, and Company shall maintain such books and
records in an orderly fashion at the Center's offices readily accessible to
Navix.
13. Assignability of Agreement. The Company and Navix may subject to the prior
written consent of the other party which consent will not be unreasonably
withheld, assign its or their rights, duties and obligations under this
Agreement, and all covenants, conditions and provisions hereunder shall inure to
the benefit of and be enforceable by and against its successor or assigns.
14. Confidentiality. Navix agrees to keep in strict confidence any and all
information Navix receives as a result of services performed at the Centers or
to which it or any of its Physicians are exposed and which has not been publicly
disclosed and is not a matter of common knowledge in the areas of practice in
which the Company is engaged. Navix agrees that, both during and after the term
of its engagement by the Company, neither Navix nor any of its Physicians,
without the prior written consent of the Company, will disclose any such
confidential information to any third person, company, joint-venture,
corporation, or other organization or otherwise use such information in
competition with the Company. Notwithstanding the foregoing, the provisions of
this paragraph shall not be applicable to Navix or the Physicians in the event
that any court action involving malpractice or if any malpractice insurance
company or federal or state agencies should require the disclosure of
information in accordance with their rules, regulations, policies or statutes.
15. Miscellaneous.
a. Notices. All notices or other communications required or permitted
to be given pursuant to the terms of this Agreement shall be in writing and-
shall be considered as properly given or made when received and either sent by
certified mail return receipt requested, hand delivery, or sent through a
reputable next business day delivery service to any of the parties at the
addresses shown below, or at such other address any of the parties may designate
from time-to-time.
(i) If to the Company:
National Diagnostics, Inc.
000-X Xxxx Xxxxxxx Xxxx.
Xxxxxxx, Xxxxxxx 00000
Attention: Xxxxxx X. Xxxxxxxx, President
(ii) If to Navix:
Navix MSO Punta Gorda, Inc.
0000 X. Xxxxxxxx Xx.
Xxxxx 000
Xxxxxxx Xxxxx, XX 00000
Attn: Chief Executive officer
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b. Complete Agreement. This Agreement and any exhibits hereto contain
the final, complete and exclusive expression of the understanding among the
parties with respect to the transactions contemplated hereby and supersede any
and all prior or contemporaneous agreements, representations or understandings,
oral or written regarding such subject matter.
c. Waiver of Amendment. A waiver to or amendment of any provision of
this Agreement will be valid and effective only if it is in writing and signed
by or on behalf of the party waiving such provision or signed by both parties in
the case of an amendment. No waiver of any provision of this Agreement shall
constitute a waiver of any other provision of this Agreement or that same
provision at any other time nor shall it be construed as a waiver or
relinquishment of the right to insist upon strict performance of the same
condition, promise, agreement or understanding at a future time.
d. Severability. If any provision of any section or subsection of this
Agreement shall be held invalid for any reason, the remainder of this Agreement
and any such section or subsection shall not be affected thereby and shall
remain in full force and effect in accordance with its terms.
e. Force Majeure. Except as otherwise provided in this Agreement, any
delays in the performance of any obligation of a party under this Agreement
shall be excused to the extent that such delay is caused by war, national
emergency, natural disaster, strike, labor dispute, utility failure,
governmental regulation, riot, adverse weather and other similar causes not
within the control of such party, and any time periods required for performance
shall be extended accordingly.
f. Rights Cumulative. No right or remedy contained herein or reserved
to either of the parties to this Agreement is intended to be exclusive of any
other right or remedy, and each and every right or remedy given under this
Agreement, shall be in addition to any rights permitted or allowed at law or in
equity.
g. Heading Captions. The titles, heading and captions preceding the
text of each section and subsection of this Agreement have been inserted solely
for convenient reference and neither constitute a part of this Agreement nor
affect its meaning, interpretation or effect.
h. Certain Definitions. As used in this Agreement, the following terms
shall have the following meanings:
(i) The term "Person" shall mean any corporation, company
limited or general partnership, joint venture, trust, association or other
business entity or enterprise or any natural person;
(ii) The term "Affiliate" shall mean with respect to any
Person, any other Person that directly or indirectly, through one or more
intermediaries, controls, is controlled by or is under common control with, such
Person and shall include any subsidiaries or other business entities that are
beneficially owned by such Person or its Affiliates;
(iii) The term "attorneys fees" shall mean any and all
reasonable charges billed by an attorney for his services including time charges
and other reasonable fees including paralegal fees and legal assistant fees and
shall include fees incurred in settlement, at trial, in arbitration, on appeal
or in bankruptcy proceedings.
i. Counterparts and Originals. The parties may execute this Agreement
in two (2) or more counterparts, each of which shall be deemed an original and
all of them, together, shall constitute one and the same Agreement.
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j. Governing Law. The validity, construction, interpretation and
enforceability of this Agreement are governed by the laws of the State of
Florida and, except as otherwise provided in this Agreement.
k. Arbitration. Any controversy or claim between or among the parties
hereto including but not limited to those arising out of or relating to this
agreement or any related instruments, agreements or documents, including any
claim based on or arising from an alleged tort, shall be determined by binding
arbitration in accordance with the commercial rules of arbitration of the
American Arbitration Association ("AAA"). Judgment upon any arbitration award
may be entered in any court having jurisdiction. Any party to this agreement may
bring an action, including a summary or expedited proceeding, to compel
arbitration of any controversy or claim to which this agreement applies in any
court having jurisdiction over such action.
A. Special Rules. The arbitration shall be conducted in the
city where the center is located. All arbitration hearings will be commenced
within 30 days of the demand for arbitration; further, the arbitrator shall
only, upon a showing of cause, be permitted to extend the commencement of such
hearing for up to an additional 60 days.
B. Reservation of Rights. Nothing in this arbitration
provision shall be deemed to (i) limit the applicability of any otherwise
applicable statutes of limitation or repose and any waivers contained in this
arbitration provision; or (ii) to obtain from a court provisional or ancillary
remedies such as (but not limited to) injunctive relief, or obtain such
provisional or ancillary remedies before, during or after the pendency of any
arbitration proceeding brought pursuant to this agreement.
l. Pronouns and Gender. All terms and words used in this Agreement,
regardless of the number or gender in which they are used, shall be deemed and
construed to include any other number, singular or plural, and other gender,
masculine, female, or neuter, as the context or sense of this Agreement or any
section, subsection, paragraph or clause may require, as if such words had been
fully and properly written in the appropriate number and gender.
16. Extension of Time to Perform. Whenever the time for the performance of any
action or condition contained in this Agreement falls on a Saturday, Sunday or
legal holiday such time shall be extended to the next business day. Except as
otherwise provided, time is of the essence of this Agreement.
17. Binding Effect. This Agreement shall be binding upon and inure to the
benefit of the parties and their respective successors - in - interest, heirs,
successors and assigns, except as otherwise provided herein.
18. Authorization and Signatories. Each of the parties hereby represents and
warrants that: (i) its entering into this Agreement is duly authorized by all
necessary Company and/or corporation action; (ii) the signatories shown on the
signature page as signing on behalf of such party are duly authorized to do so
and (iii) upon their signing and delivery of this Agreement, each party shall be
bound by the terms and provision of this Agreement.
19. Attorneys' Fees. In the event of a dispute or if litigation or arbitration
proceedings are instituted by any one or more of the parties hereto, the
prevailing party to said proceeding shall be entitled to reimbursement for
reasonable attorneys fees and costs incurred in connection with said proceeding.
For purposes of this Section, the term "attorneys' fees and costs" shall
include, without limitation, the actual
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attorney fees incurred in retaining counsel for advice, suit, arbitration,
appeal or any other proceedings.
IN WITNESS WHEREOF, this Agreement has been duly executed by the
parties as of the date set forth on the first page of this Agreement.
NATIONAL DIAGNOSTICS, INC.
By: /s/ Xxxxxx X. Xxxxxxxx
-----------------------------------
Xxxxxx X. Xxxxxxxx
President
NAVIX MSO OF PUNTA GORDA, INC.
By: /s/ Xxxxx Xxxxxx
-----------------------------------
Name: Xxxxx Xxxxxx
---------------------------------
Title: Chief Financial Officer
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NATIONAL DIAGNOSTICS PROFESSIONAL SERVICES AGREEMENT
