MANAGEMENT SERVICES AGREEMENT
This Management Services Agreement ("Agreement") is made and entered
into as of January 1, 2000 by and between DCA of Vineland, LLC, a New Jersey
limited liability company ("Manager") and DCA Medical Services, Inc., a Florida
corporation ("Company").
WHEREAS, the Manager runs a hemodialysis outpatient center which
provides all levels of outpatient dialysis care ("Facility");
WHEREAS, the Company is an established provider of home dialysis
equipment and supplies ("Home Services") which needs various administrative,
clinical and management services in order to conduct its business in a more
efficient manner ("Business").
WHEREAS, certain dialysis patients of the Manager receive Home Services
from the Company ("Common Patients");
WHEREAS, Manager has experience in providing and is ready, willing and
able to provide administrative, clinical and management services to the Company
in connection with the Common Patients of the Company and the Manager
("Management Services") with respect to Home Services;
NOW, THEREFORE, in consideration of the mutual promises and covenants
contained in this Agreement and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties, intending
to be legally bound, agree as follows:
1. SCOPE OF THE AGREEMENT.
1.1 GENERALLY. The Management Services shall include providing
the Company with bookkeeping, accounting, data processing, collection of
accounts receivable, and other computer based information services, maintenance
of medical records, and related Management Services in connection with the
Common Patients of the Company and the Manager relating to Home Services.
1.2 LICENSE. In order to facilitate the performance of the
Management Services, the Company grants to the Manager an irrevocable license to
use any and all of the Company's assets used in the Business; provided no
provision of this Agreement is intended nor shall it be construed to permit the
Manager to effect, interfere with, or influence the Method 2 operations of the
Business of the Company; and provided further, to the extent that any act or
service required or provided to the Company by the Manager by any provision of
this Agreement may be construed or deemed to constitute the practice of medicine
or the ownership or control of the Method 2 operations of the Business, such
provision shall be void AB INITIO, and the performance of such act or services
by the Manager shall be deemed waived by the Company.
1.3 APPLICABLE LAW. The Manager shall use its best efforts to
comply with all applicable federal and state laws, statutes, rules and
regulations in performing the Management Services under this Agreement.
2. MANAGEMENT FEE.
In consideration of the Management Services provided by the Manager,
the Manager's fee shall be the Company's revenues derived from the Common
Patients, excluding the Company's direct costs and expenses associated with the
Common Patients.
3. TERM.
3.1 TERM. The Term of this Agreement shall be for three (3)
years, commencing on the date above, and assuming no breach of this Agreement,
shall be automatically renewable for additional three (3) year Terms, unless
within 120 days of the ending period of the Term or any Renewal Term either of
the parties gives its written notice that it intends not to be bound for an
additional Term.
3.2 TERMINATION BY EITHER PARTY.
3.2.1 BREACH. Either party may terminate this
Agreement if the other party breaches this Agreement and such breach is not
cured to the reasonable satisfaction of the nonbreaching party within sixty (60)
days after the receipt of written notice of the default (the "Default Notice"),
or in the case of a breach which cannot be cured within such time period, the
breaching party has not made a good faith effort to attempt to cure such default
within such time period.
3.2.2 BANKRUPTCY OR CESSATION OF BUSINESS. Either
party may terminate this Agreement immediately upon the occurrence of any of the
following events with regard to the other party:
(a) the making of a general assignment for
the benefit of creditors;
(b) the filing of a voluntary petition or
the commencement of any proceeding by either party for any relief under any
bankruptcy or insolvency laws, or any laws relating to the relief of debtors,
readjustment of indebtedness, reorganization, composition or extension;
(c) the filing of any involuntary petition
or the commencement of any proceeding by or against either party for any relief
under any bankruptcy or insolvency laws, or any laws relating to the relief of
debtors, readjustment of indebtedness, reorganization, composition or extension,
which such petition or proceeding is not dismissed within sixty (60) days of the
date on which it is filed or commenced; or
(d) suspension of the transaction of the
usual business of either party for a period in excess of sixty (60) days.
3.2.3 AT-WILL TERMINATION. Manager may terminate this
Agreement at any time, with or without cause, by giving the Company not less
than sixty (60) days' prior written notice. The Company may terminate this
Agreement with or without cause, at the end of the initial Term by giving the
Manager not less than one hundred twenty (120) days' prior written notice of its
intent to terminate the Agreement at the end of the Term.
3.3 TERMINATION UPON MUTUAL AGREEMENT. The parties may
terminate this Agreement at any time upon execution of a writing signed by all
parties.
3.4 EFFECT OF TERMINATION. Upon termination or expiration of
this Agreement for any reason:
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(a) the Manager shall have the right to obtain and
retain any amounts owed to Manager under Section 2 hereof as of the date of such
termination or expiration;
(b) the Company shall return to the Manager any and
all property of the Manager which may be in the Company's possession or under
the Company's control;
(c) the Manager shall return to the Company any and
all property of the Company which may be in the possession or control of the
Manager, including medical records, corporate, personnel and financial records
maintained for the Business and any and all information concerning the Common
Patients; provided that Manager shall be entitled to retain a copy of such
records and information to complete Management Services authorized by this
Agreement, or as necessary for the benefit of the Company, or as may be required
by law.
4. MISCELLANEOUS.
4.1 ENTIRE AGREEMENT. This Agreement supersedes any and all
other agreements, either oral or in writing, between the parties hereto with
respect to the subject matter of this Agreement. This Agreement may not be
changed orally, and may only be amended by an agreement in writing signed by
both parties, which shall be attached hereto.
4.2 GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the laws of the State of New Jersey.
4.3 SEVERABILITY. If any provision of this Agreement shall be
held by a court or administrative agency of competent jurisdiction to be
contrary to law, or in a written opinion to the Manager by legal counsel
knowledgeable in healthcare matters retained by the Manager, that provision will
be enforced to the maximum extent permissible, and the remaining provisions of
this Agreement will remain in full force and effect, unless to do so would
result in either party not receiving the benefits of its bargain.
4.4 RIGHTS UNAFFECTED. No amendment, supplement or termination
of this Agreement shall affect or impair any rights or obligations that had
previously matured under this Agreement.
4.5 SUCCESSORS. This Agreement shall be binding upon and shall
inure to the benefit of the parties, their respective heirs, executors,
administrators and assigns.
4.6 FURTHER ACTIONS. Each of the parties hereto agrees that it
shall hereafter execute and deliver such additional instruments and undertake
such additional acts as may be required or useful to carry out the intent and
purpose of this Agreement and as are not inconsistent with the terms hereof.
4.7 COMPLIANCE WITH LAW.
4.7.1 CHANGE IN LAW. In the event of any material
change in, or interpretation or enforcement of, any federal or state law or
regulation (including state or federal anti-kickback statutes and Medicare or
Medicaid reimbursement principles) that would make either the Management Fee or
this Agreement unlawful, or if performance by a party of any duties under this
Agreement is deemed illegal by any court or administrative agency or in a formal
opinion rendered to either party by outside legal counsel of standing, the
affected party shall have the right to require that the other party renegotiate
the affected terms of this Agreement with the goal of placing the parties in as
similar a position as possible to
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their respective positions in this Agreement. To the maximum extent possible,
any such amendment shall preserve the underlying economic and financial
arrangements between the Company and the Manager.
4.7.2 COMPLIANCE WITH LAW. The parties shall (a)
cooperate with one another in the fulfillment of their respective obligations
under this Agreement, and (b) comply with the requirements of law and with all
ordinances, statutes, regulations, directives, orders, or other lawful
enactments or pronouncements of any federal, state, municipal, local or other
lawful authority applicable to the Business.
4.8 NON-ASSIGNMENT. The Company may not assign this Agreement
except with the prior written approval of the Manager. The Manager may assign
its rights hereunder to any person that is an affiliate of the Manager and to
any lending institution, for security purposes or as collateral, from which the
Manager obtains financing or to any purchaser of the Manager or of substantially
all of the assets of the Manager, or to any person with which the Manager may
merge or consolidate.
4.9 COUNTERPARTS. This Agreement may be executed in one or
more counterparts, each of which shall constitute an original Agreement but all
of which together shall constitute one and the same instrument.
4.10 HEADINGS. The article and section headings used in this
Agreement are for purposes of convenience only. They shall not be construed to
limit or extend the meaning of any part of this Agreement.
4.11 ARBITRATION. Any disputes arising under this Agreement
shall be determined by arbitration in __________ County, the State of New Jersey
in accordance with the rules of the American Arbitration Association
("Association") then in effect, by a single arbitrator selected by mutual
agreement of the parties or, if the parties are unable to agree on an
arbitrator, by the Association; provided that this Section 4.11 shall not
restrict the right of either party to institute a legal proceeding to enable
such party to obtain temporary injunctive relief during the pendency of any such
arbitration. A determination of the dispute by the arbitrator shall be final and
binding on the parties to the extent permitted by law. The cost of the
arbitration, including attorneys' or other consultancy fees, shall be borne by
the non-prevailing party.
4.12 STATUS OF PARTIES. In the performance of all work, duties
and obligations under this Agreement, it is mutually understood and agreed that
each party is at all times acting and performing as an independent contractor
with respect to the other and that no relationship of partnership, joint venture
or employment is created by this Agreement. Each party shall be solely
responsible for and shall comply with all state and federal law pertaining to
employment taxes, income withholding, unemployment compensation contribution and
other employment related statutes applicable to that party.
4.13 FORCE MAJEURE. Neither party shall be deemed to be in
default of this Agreement if such party is prevented from performing any
obligation hereunder for any reason beyond its control, including but not
limited to, Acts of G-d, war, civil commotion, fire, flood or casualty, labor
difficulties, governmental regulations or restrictions, or unusually severe
weather. In any such case, the parties agree to negotiate in good faith with the
goal of preserving this Agreement and the respective rights and obligations of
the parties hereunder, to the extent reasonably practicable. It is agreed that
for purposes of this Agreement financial inability shall not be deemed to be a
matter beyond a party's reasonable control.
4.14 NOTICES. Any notice, demand, approval, consent or other
communication to be given hereunder by either party to the other shall be deemed
to be received by the intended recipient (a) when delivered personally, (b) the
day following delivery to a nationally recognized overnight courier
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service with proof of delivery, (c) by facsimile or e-mail transmission provided
such is substantiated by personal or mail delivery, or (d) three (3) days after
mailing by certified mail, postage prepaid with return receipt requested, in
each case addressed to the parties as set forth below:
If to the Company: DCA Medical Services, Inc.
c/o Dialysis Corporation of America
00 Xxxxxx Xxxxxx
Xxxxxxx, XX 00000
Attn: Xxxxxxx Xxxxxxx, President
If to the Manager: DCA of Vineland, LLC
c/o Xxxxxxxx X. Xxxxx, Esq., Secretary
000 Xxxxxxx Xxxxxx
Xxxxxxxxx Xxxxxxx, XX 00000
Any party may change the address for notice by notifying the other party, in
writing, of the new address.
4.15 CONFIDENTIALITY. Except for disclosure to its attorneys,
accountants, bankers, underwriters or lenders, or as necessary or desirable for
conduct of business, neither party hereto shall disseminate or release to any
third party any information regarding any provision of this Agreement, or any
financial information regarding the other (past, present or future) that was
obtained by the other in the course of negotiation of this Agreement or in the
course of the performance of this Agreement, without the other party's written
approval; provided, however, the foregoing shall not apply to information which
(i) is generally available to the public other than as a result of a breach of
any confidentiality provisions, (ii) becomes available on a non-confidential
basis from a source other than the other party, or its affiliates or agents,
which source was not itself bound by a confidentiality agreement, or (iii) which
is required to be disclosed by law, including securities laws, or pursuant to
court order.
4.16 USE OF CERTAIN TERMS. The definitions and terms used in
this Agreement apply equally to both the singular and the plural; any provision
shall include the corresponding masculine, feminine and neuter; the words
"include" and "including" shall be deemed to be followed by the phrase "without
limitation"; the terms "hereof" and "herein" shall refer to the particular
document in which such term appears.
IN WITNESS WHEREOF, the parties have caused their authorized
representatives to execute this Agreement as of the date first above written.
DCA MEDICAL SERVICES, INC.
("Company")
By: /s/ XXXXXXX X. XXXXXXX
------------------------------------
XXXXXXX XXXXXXX, President
DCA OF VINELAND, LLC
("Manager")
By: /s/ XXXXXXX X. XXXXXXX
------------------------------------
DIALYSIS CORPORATION OF AMERICA,
Managing Partner
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