MANAGEMENT SERVICES AGREEMENT



                                    BETWEEN



                          ----------------------------
                                 (the "New PC")

                                      AND


                        Omega Orthodontics of Reno, Inc.
                                  (the "MSO")

                                      AND

                            Omega Orthodontics, Inc.
                                   ("OMEGA")
<PAGE>
                         MANAGEMENT SERVICES AGREEMENT

                               TABLE OF CONTENTS



ARTICLE 1 TERM.........................................................2

ARTICLE 2 DUTIES OF THE MSO............................................2

2.1 General............................................................2
2.2 Endodontic Office Services.........................................2
2.3 Administrative Services............................................2
2.4 Business Systems, Procedures and Forms.............................3
2.5 Purchasing, Accounts Payable, Supplies and Inventory Control.......3
2.6 Regulatory Compliance Services.....................................3
2.7 Billing, Collection................................................4
2.8 Disbursement of Funds..............................................4
2.9 MSO Expenses.......................................................5
2.10 Credit Reports....................................................6
2.11 Accounting; Bookkeeping and Reports...............................6
2.12 Marketing.........................................................7
2.13 Complaints........................................................7
2.14 Practice Laws.....................................................7
2.15 Monthly Meetings..................................................7
2.16 Maintenance and Cleaning Services.................................7
2.17 Licenses and Permits..............................................7
2.18 Insurance.........................................................7
2.19 Practice Transition and Associate Selection.......................8

ARTICLE 3 DUTIES OF THE NEW PC.........................................8

3.1 General............................................................8
3.2 Employment of the Endodontists and Rendering of Patient Care.......8
3.3 Professional Services..............................................8
3.4 Records............................................................9
3.5 Professional Expenses..............................................9
3.6 Professional Liability Insurance...................................9
3.7 Employment Agreement...............................................9
3.8 Confidentiality...................................................10

ARTICLE  4  PROFESSIONAL   SERVICES,   CONTROL  OF  SOLICITATION,   APPROVAL  OF
ADVERTISING MATERIAL AND NO RECIPROCATION.............................11

ARTICLE  5 LEASE OF OFFICE FACILITIES AND EQUIPMENT...................11
5.3.  No Warranty.....................................................13

ARTICLE  6 COMPENSATION...............................................13

ARTICLE  7 SECURITY INTEREST..........................................14

ARTICLE  8 COVENANTS..................................................14

8.1 New PC's Covenants................................................14
8.2 MSO's Covenants...................................................15

ARTICLE 9 INSURANCE AND INDEMNITY.....................................16

9.1 Insurance to be Maintained by the New PC..........................16
9.2 Insurance to be Maintained by the MSO.............................16
9.3 Tail Insurance Coverage...........................................16
9.4 Additional Insureds...............................................16
9.5 Indemnification...................................................16

ARTICLE  10 TERMINATION...............................................17

10.1 Termination by the New PC........................................17
10.2 Termination by MSO...............................................17

ARTICLE  11 AUTHORIZED AGENT AND POWERS OF ATTORNEY...................18

ARTICLE  12 INDEPENDENT CONTRACTOR RELATIONSHIP.......................19

ARTICLE  13 MISCELLANEOUS.............................................19

13.1 Access to Records................................................19
13.2 Patient Records..................................................19
13.3 The New PC's Control Over the Endodontic Practice................19

ARTICLE 14 ALTERNATIVE DISPUTE RESOLUTION.............................20

14.1 Alternative Dispute Resolution...................................20
14.2 Waiver of Jury...................................................20

ARTICLE  15 GENERAL PROVISIONS........................................21

15.1 Notices..........................................................21
15.2 Confidentiality..................................................21
15.3 Contract Modifications for Prospective Legal Events..............21
15.4 Remedies Cumulative..............................................22
15.5 No Obligation to Third Parties...................................22
15.6 Entire Agreement.................................................22
15.7 Assignment.......................................................22
15.8 Attorneys' Fees..................................................22
15.9 Governing Law....................................................22
15.10 Events Excusing Performance.....................................23
15.11 Compliance with Applicable Laws.................................23
15.12 Language Construction...........................................23
15.13 Amendments......................................................23
15.14 Severability....................................................23
15.15 No Waiver.......................................................23
15.16 Captions........................................................23
15.17 Counterparts....................................................23


SCHEDULE 1 THE ENDODONTISTS

SCHEDULE 2 ENDODONTIC OFFICES AND SERVICES

SCHEDULE 3 COMPENSATION - MANAGEMENT FEES

EXHIBIT A ENDODONTIC OFFICES - MASTER LEASE

EXHIBIT B PRACTICE PROVIDERS

EXHIBIT C NEW PC'S AFFIDAVIT

EXHIBIT D SECURITY AGREEMENTS

EXHIBIT E ALTERNATIVE DISPUTE RESOLUTION PROCEDURES
<PAGE>
                         MANAGEMENT SERVICES AGREEMENT

            THIS   AGREEMENT  is  made   effective  as  of  this  _____  day  of
___________,  1997, by and between  ____________________,  Inc., a  professional
corporation  (the "New PC")  incorporated  under the laws of the State of Nevada
(the "State"), and Omega Orthodontics of Reno, Inc., a Delaware corporation (the
"MSO"), and Omega Orthodontics, Inc., a Delaware corporation ("OMEGA").

            WHEREAS,  OMEGA  provides  professional   management  and  marketing
services  to  endodontic  and other  dental  specialty  practices  in the United
States,  which services include providing practice  management  systems,  office
space, equipment,  furnishings and active administrative personnel necessary for
the operation of such practices and are provided directly or indirectly  through
management service organizations such as the MSO;

            WHEREAS,  OMEGA and Rodney A. Gray, D.D.S.  ("Dr. Gray") who is duly
licensed to practice  endodontics  in the State have  entered  into that certain
Affiliation Agreement and Asset Purchase Agreement (the "Affiliation Agreement")
dated as of  _______________,  1997,  pursuant to which OMEGA  acquired  certain
assets of Dr. Gray;

            WHEREAS,  the New PC owns and operates an  endodontic  practice with
offices  located in the  facilities  identified  in  Exhibit A (the  "Endodontic
Offices")  and  furnishes  endodontic  care to the  general  public  through the
services  of Dr.  Gray  and any and all  other  Endodontists  who are or  become
affiliated  with the New PC as of or  following  the date  hereof and who are or
become subsequently named on Schedule 1 hereto  (individually,  an "Endodontist"
and collectively, the "Endodontists");

            WHEREAS,  the MSO was formed  and  acquired  to  provide  equipment,
facilities and personnel to, and to manage the  non-endodontic  business affairs
of, the New PC;

            WHEREAS,  the MSO's  services are designed to improve the efficiency
and  profitability of the New PC while enhancing the ability of Dr. Gray and the
Endodontists  (if any) to render quality  endodontic care to the patients of the
New PC;

            WHEREAS,  the  New PC  wishes  to  retain  the  MSO to  perform  the
functions and to provide the services  described in this Agreement to assist the
New PC to achieve the above goals.

            NOW,  THEREFORE,  IT IS AGREED that the MSO shall perform managerial
and  administrative  services  for  the  New PC and  provide  office  space  and
endodontic facilities  appropriate for rendering general endodontic treatment at
the Endodontic Offices upon the following terms and conditions:
<PAGE>
                                    ARTICLE 1
                                      TERM

            1.1 The initial term of this  Agreement  shall  commence on the date
first above written and continue for a period of twenty (20) years (the "Initial
Term"),  subject,  however, to earlier termination in accordance with Article 10
hereof.  This Agreement  shall continue for two separate and successive ten year
periods  (each a "Renewal  Term" and  collectively  with the Initial  Term,  the
"Term")  unless the MSO otherwise  elects upon six months  written notice to the
New PC prior to  expiration  of the Initial Term or any then  effective  Renewal
Term.

                                    ARTICLE 2
                                DUTIES OF THE MSO

            2.1  General.  The MSO shall  provide the New PC with  comprehensive
practice  management,  financial and marketing  services,  and such  facilities,
equipment,  and support  personnel as are  reasonably  required by the New PC to
operate its endodontic  practice at the Endodontic Offices, as determined by the
MSO in  consultation  with the New PC. The New PC hereby appoints the MSO as the
sole and exclusive  business manager of the New PC and agrees that the MSO shall
have all power and authority  reasonably  necessary to manage the non-endodontic
business affairs of the New PC and carry out the MSO's  endodontic  duties under
this  Agreement,  subject to the  requirements  of the applicable  provisions of
State law relating to the practice of  endodontics.  The MSO may perform some or
all of its services at a location other than at the Endodontic Offices.

            2.2 Endodontic Office Services. The MSO shall provide or arrange for
the  provision  of the  office  space  and  related  leasehold  improvements  to
constitute the Endodontic Offices and related fixtures, furniture,  furnishings,
equipment and related services (collectively,  the "Endodontic Office Services")
described  in Schedule 2 hereto,  as such  Schedule may be amended by the New PC
and the MSO from time to time.  The MSO shall be  responsible  for all  repairs,
maintenance and replacement of the Endodontic  Offices  including such leasehold
improvements,   fixtures,  furniture,  furnishings  and  equipment,  except  for
repairs,  maintenance and replacement  necessitated by the negligence of the New
PC, its employees and agents (not including the MSO or its employees or agents).
The MSO shall, on an ongoing basis,  evaluate and consult with the New PC on the
equipment  needs of and the efficiency  and adequacy of the Endodontic  Offices.
The MSO shall provide telephone,  facsimile transmission,  printing, duplicating
and transcribing services as needed, as well as all laundry, linen and uniforms.

            2.3   Administrative Services.

            (a) The MSO shall supply secretarial,  reception, maintenance, front
office,  skilled assistants and other personnel,  except duly licensed "Practice
Providers," during normal office hours as reasonably requested by the New PC, to
enable the New PC to perform effectively  endodontic and treatment services. The
MSO shall be  responsible  for staff  scheduling,  provided,  however,  that all
Practice Providers including endodontic assistants and hygienists shall be under
the direct  supervision  of the New PC. The New PC shall have sole  authority to
employ and terminate the  employment  of all Practice  Providers.  All personnel
placed in the Endodontic  Offices by the MSO shall be subject to the approval of
the New PC, which approval shall not be  unreasonably  withheld,  and the New PC
shall have the authority to instruct the MSO to terminate the employment of such
personnel for any lawful reason.  The MSO shall be responsible for all personnel
wages, withholding, fringe benefits, bonuses and workers' compensation insurance
in connection with its employees;  provided, however, that the New PC is in full
compliance with the compensation provisions of this Agreement.

            (b) "Practice  Providers"  shall mean the  individuals  who are duly
licensed to practice  dentistry  and/or  endodontics in the State  including Dr.
Gray and the  Endodontists  (if any) and other  individuals who are employees of
the New PC or  otherwise  under  contract  with the New PC to provide  dental or
endodontic,  hygienic or other  assistance or services to patients of the New PC
or otherwise  required by applicable "Laws" (as defined in Section 2.6 below) to
be employees of the New PC to provide  services to patients of the  Practice.  A
list of all Practice Providers and their relationship to the New PC is set forth
as Exhibit B attached  hereto and  incorporated  herein by  reference.  Prior to
making any changes in the list of Practice  Providers,  the New PC shall use its
best efforts to consult with the MSO. The New PC also shall use its best efforts
to  consult  with the MSO with  regard to the terms of  contracts  entered  into
between the New PC and the Practice  Providers  and the terms and  conditions of
their employment or engagement as independent contractors.

            2.4 Business Systems, Procedures and Forms. In consultation with the
New PC, the MSO shall establish standardized business systems and procedures for
the New PC, including, but not limited to, patient scheduling systems, treatment
records  system,  financial  reporting and process  control  systems and patient
communication  management systems (the "OMEGA Patient  Scheduling  System") that
are designed to improve the New PC operating  efficiency.  The MSO shall analyze
such  information  on an ongoing  basis in order to advise the New PC on ways of
improving operating efficiencies. The MSO shall provide training to the staff of
the New PC in the  implementation  and operation of such  standardized  business
systems and procedures.  The MSO shall additionally  provide the New PC with and
train the New PC's staff in the use of standardized  clinical forms,  including,
without  limitation,  forms for patient evaluations and treatment plans. The New
PC expressly  acknowledges  and agrees that it shall have no property  rights in
the OMEGA Patient Scheduling System and the other foregoing systems,  procedures
and clinical forms, and further agrees that such systems,  procedures, and forms
shall be deemed to  constitute  Confidential  Information  within the meaning of
Section 3.8 hereof and be subject to the restrictions on the use, appropriation,
and reproduction of such Confidential Information provided for in Section 3.8.

            2.5 Purchasing,  Accounts Payable,  Supplies and Inventory  Control.
The MSO shall be responsible  for and shall  establish and maintain  systems for
the handling and processing of all purchasing and payment activities and for the
performance of all payroll and payroll  accounting  functions of the New PC. The
MSO shall order and purchase and maintain all inventory and endodontic  supplies
as reasonably  required by the New PC to enable the New PC to render  endodontic
care to its patients including,  without limitation,  all endodontic  appliances
and other supplies, laboratory supplies and sanitation supplies.

            2.6  Regulatory  Compliance  Services.  The MSO shall arrange for or
cause  to be  rendered  to the  New  PC  such  business,  legal  and  regulatory
management consultation and advice as may be reasonably required or requested by
the  New  PC  and  directly  related  to the  operations  of  the  New PC or its
compliance   with  Federal,   state  or  local  laws,   rules,   regulations  or
interpretations  governing or applicable to the New PC  (collectively,  "Laws");
provided,  however,  that the MSO  shall  not be  responsible  for any  services
related to  malpractice  or other  professional  service  claims or matters  not
directly  related to the operation of the New PC or its compliance with Laws, or
for any legal or tax advice or services or  personal  financial  services to Dr.
Gray and the Endodontists (if any) or any employee or agent of the New PC.

            2.7  Billing,  Collection.  The MSO shall be  responsible  for:  (i)
billing  and  collecting  payments  for all  endodontic  and other  professional
services  rendered  by the New PC and the  Practice  Providers,  with  all  such
billing  and  collecting  to be done in the name of the New PC;  (ii)  receiving
payments from  patients,  insurance  companies and all other third party payors;
(iii) taking  possession  of and  endorsing in the name of the New PC any notes,
checks,  money  orders,  insurance  payments and other  instruments  received in
payment  for  services  or  of  accounts  receivable;   and  (iv)  settling  and
compromising  claims and,  where deemed  appropriate by the MSO and consented to
(which  consent shall not be  unreasonably  withheld or delayed) by the Practice
Provider  rendering the  professional  services which resulted in the applicable
accounts  receivable,  assigning such accounts receivable to a collection agency
or the bringing of a legal  action  against a patient or a payor on the New PC's
behalf. In seeking payments on behalf of the New PC hereunder, the MSO shall act
as the New PC's agent in billing and collecting  professional  fees, charges and
other  accounts  owed to the New PC and  shall  only  bill  under  the New  PC's
provider  number.  In this  regard,  the New PC appoints the MSO for the Term of
this  Agreement in  accordance  with the  provisions of Article 11 hereof as its
true and  lawful  attorney-in-fact  for the  purposes  set  forth  above in this
Section 2.7 and in Section 2.8 below. The MSO does not guarantee  collection and
is not  responsible  for any loss to the New PC as a result of any  inability to
collect fees and charges.

            2.8   Disbursement of Funds.

            (a) All  monies  collected  for the  New PC by the MSO  pursuant  to
Section 2.7 above shall be deposited  into an account (the "the New PC Account")
with a bank whose  deposits  are  insured  with the  Federal  Deposit  Insurance
Corporation and which bank is acceptable to the MSO and the New PC (the "Bank").
The New PC Account  shall contain the name of the New PC, but the MSO shall make
all disbursements  therefrom.  The MSO shall account for all monies so disbursed
from the New PC Account.

            (b) From the funds  collected and deposited by the MSO in the New PC
Account,  the MSO  shall  make  for and on  behalf  of the New PC the  following
disbursements promptly, when payable:

                  (1)  Compensation,  including  salaries,  benefits  and  other
direct  costs  payable to Dr. Gray and the  Endodontists  (if any) and the other
Practice  Providers  of the New PC, and all  withholding  taxes and  assessments
payable  to  Federal,  state  and  local  governments  in  connection  with  the
employment of such personnel; and

                (2) All  compensation  payable to the MSO  pursuant to Article 6
hereof.

            (c) In the event the funds in the New PC Account  will,  at any time
be  insufficient  to cover the current  portion of the  foregoing  expenses when
payable,  the  MSO may  advance  to the New PC the  necessary  funds  to pay the
current  portion of such expenses for the benefit of the New PC, which  advances
will be deemed to be loans to the New PC to be repaid without  interest from the
New PC Account at such times as there are  adequate  funds  therein or upon such
other  terms and at such  times as  agreed  to by the New PC and the MSO,  which
indebtedness shall not be deemed an MSO Expense for purposes of Section 2.9.

            2.9 MSO Expenses.  The MSO shall be  responsible  for the payment of
all MSO Expenses,  as defined below,  during the term of this Agreement  without
reimbursement by the New PC, unless otherwise agreed to by the parties hereto.

            (a) "MSO  Expenses"  shall  mean  all  operating  and  non-operating
expenses incurred in the operation of the New PC, including, without limitation:

                  (1) Salaries, benefits and other direct costs of all employees
of the MSO providing  services to the New PC hereunder  (but  excluding Dr. Gray
and all the Endodontists (if any) and other Practice Providers);

                  (2) Direct costs of all  employees or  consultants  of the MSO
who provide services at the Endodontic  Offices or in connection with the New PC
required for improved clinic  performance,  such as work  management,  materials
management,   purchasing,  charge  and  coding  analysis,  and  business  office
consultation;

                  (3) Direct costs  associated  with  operating  the  Endodontic
Offices, including without limitation, utilities, cleaning and maintenance;

                  (4)  Obligations of the MSO under leases or subleases  entered
into in  connection  with the  operation  of the  Endodontic  Offices as well as
utility expenses relating to the Endodontic Offices;

                  (5) Personal  property and intangible  taxes assessed  against
the  MSO's  assets  used in  connection  with the  operation  of the  Endodontic
Offices, commencing on the date of this Agreement;

                  (6)  In  the  event  an  opportunity   arises  for  additional
Endodontists  to become employed by the New PC or other  endodontic  entities to
merge  with  the New PC,  actual  out-of-pocket  expenses  of the MSO  personnel
working on a specified  employment  arrangement  or merger,  whether or not such
employment arrangement or merger is consummated;

                  (7) Other  expenses  incurred by the MSO in  carrying  out its
obligations under this Agreement,  but excluding any corporate overhead costs of
the MSO or any  corporation  affiliated  with  the MSO not  specifically  listed
above.

            "MSO Expenses" shall not include:

                  (1) Any  Federal,  state or local  income taxes of the New PC,
Dr. Gray and the Endodontists (if any) and the other Practice Providers,  or the
costs of preparing Federal, state or local tax returns thereof;

                  (2) Salaries, benefits and other direct costs of employing Dr.
Gray and the Endodontists (if any) and the other Practice Providers;

                  (3) Physician  licensure fees,  board  certification  fees and
costs of  membership  in  professional  associations  and societies for Practice
Providers;

                  (4)   Professional   liability   insurance  for  the  Practice
Providers as provided for under Section 3.6 hereof;

                  (5) Costs of  continuing  professional  education for Practice
Providers, including travel and related expenses;

                  (6) Costs  associated with legal,  accounting and professional
services  incurred  by or on  behalf  of the  New PC  other  than  as  otherwise
expressly provided for in Section 2.6 hereof;

                  (7)  Liability  judgments  assessed  against the New PC or the
Practice Providers in excess of policy limits or within the deductible limits of
any policy;

                  (8) Direct  personal  expenses of the Practice  Providers of a
kind which the New PC may have historically  provided or charged to its Practice
Providers  (including,  but not limited to, car  allowances  and other  expenses
which are personal in nature);

                  (9)  Charitable contributions by the New PC; and

                  (10) Any other expenses which are expressly  designated herein
as expenses or responsibilities of the New PC.

            2.10 Credit Reports. When requested by the New PC, or its authorized
representative,  the MSO shall obtain on behalf of the New PC  information  with
regard to the ability of patients to pay for the  services to be rendered by the
New PC. The MSO shall collect all information and determine,  to the best of its
ability,  whether or not patients  can pay for services  rendered by the New PC,
either in cash or by  insurance.  Such  determination  shall be  subject  to the
reasonable  approval by the New PC, and as between  the New PC and the MSO,  the
New PC shall  bear the risk of claims by  potential  patients  who may be denied
credit.

            2.11 Accounting;  Bookkeeping and Reports. The MSO shall provide for
or arrange for all accounting and bookkeeping  services  related to the New PC's
operations,  provided that such services are incurred in the ordinary  course of
business.  In  addition,  the MSO  shall  provide  the New PC with an  unaudited
internal  monthly  statement within twenty (20) days after the end of each month
and a quarterly  review  within  thirty (30) days after the end of each quarter,
respectively, of the MSO's internal statements, as well as the books and records
of the New PC, all prepared by or with the assistance of an accountant chosen by
the MSO. At the end of each fiscal year of the New PC, the MSO shall arrange for
a  financial  statement  with  respect to the New PC to be prepared by the MSO's
accountant.  At the New PC's request,  the MSO shall prepare reports  indicating
the gross revenues,  number of patients,  type of patients, and the activity and
the  productivity  of the New PC. The MSO shall  assist and advise the New PC in
the financial management of the New PC.

            2.12 Marketing. The MSO shall design and execute a marketing plan to
promote the New PC's professional services. The MSO shall also make available to
the New PC all brochures,  contracts,  and other materials reasonably related to
the  carrying  out  of the  business  purposes  of the  New  PC,  including  all
stationery,  printing and postage costs in connection  therewith.  In connection
with such marketing plan, the MSO shall advise Dr. Gray and the Endodontists (if
any)  on  establishing  and  maintaining  a  plan  for  patients'  payments  for
endodontic  services on an  installment  plan basis.  All  marketing  activities
hereunder  shall be conducted in compliance  with all applicable  Laws governing
advertising by the endodontic profession.

            2.13  Complaints.  The MSO shall  assist the New PC in handling  all
complaints,  grievances  and  disputes  involving  the New PC and  the  Practice
Providers  and any  patients or third  parties.  However,  the MSO shall have no
control  over the New  PC's  patients.  All  decisions  concerning  the New PC's
patients shall be made by the New PC and the Practice Providers.

            2.14 Practice Laws. Notwithstanding any provision in this Agreement,
the MSO shall not take any action in connection with the services to be rendered
hereunder that violates any Law, including,  without limitation, the performance
of any  task or the  taking  of any  action  which  violates  the  Business  and
Professions  Code  of  the  State  as  it  relates  to  professional  endodontic
practices.

            2.15  Monthly  Meetings.  The MSO  shall  initiate  monthly  or more
frequent  meetings with the New PC regarding the policies and procedures for the
operation of the New PC.

            2.16  Maintenance and Cleaning  Services.  The MSO shall arrange for
security,  maintenance  and cleaning of the  Endodontic  Offices,  including the
furniture, fixtures and equipment therein.

            2.17  Licenses  and Permits.  The MSO shall  provide and pay for all
business  and other  licenses  and  permits as  necessary  to operate the New PC
except those related to licensure and certifications of the Practice  Providers.
The MSO shall prepare and file all reports, forms and returns required by Law in
connection with workers' compensation,  unemployment insurance,  social security
and other similar Laws with respect to the MSO's employees.

            2.18 Insurance.  The MSO shall provide and pay for customary  office
property damage and liability,  including business interruption  insurance,  not
including  professional  liability  insurance  (which  shall be and  remain  the
responsibility of the New PC).

            2.19 Practice Transition and Associate  Selection.  Dr. Gray and the
Endodontists  (if any) shall keep the MSO  informed  of  retirement  goals on an
ongoing basis;  provided,  however,  that Dr. Gray shall continue as a full time
employee of the New PC, actively  engaged in the practice of endodontics,  for a
period of not less than five (5)  years  following  the date of this  Agreement.
Upon  request  of the New PC, the MSO will  conduct a search for an  appropriate
endodontist and other professionals  (collectively,  "Practice  Associates") for
the purposes of accommodating practice growth, reducing doctor work schedule, or
planned  retirement.  Such  search  shall  include  use by the MSO of a national
journal   advertising  program  and  networking  in  the  profession  to  locate
appropriate  Practice   Associates.   The  MSO  estimates  that  it  could  take
approximately two years for such a search.

The  MSO  will  provide  screening  of all  applicants  and  will  then  present
appropriate  applicants  for final  selection by the New PC. The New PC shall be
responsible for interviewing and selecting each Practice Associate.

After the Practice  Associate(s)  is (are)  selected by the New PC, the MSO will
assist  the New PC with a trial  plan of  approximately  six  months for the new
Practice  Associate(s).  It is understood  that at the end of this period either
the New PC or the new Practice  Associate may terminate  the  relationship.  All
such Practice  Associates  recruited by the MSO as may be accepted by the New PC
shall be employees of the Practice (if so employed)  and not of the MSO. The MSO
will confer with the New PC on an appropriate salary/work-in arrangement for the
new Practice Associate and the final arrangements shall be determined by the New
PC.

                                    ARTICLE 3
                              DUTIES OF THE NEW PC

            3.1 General.  The New PC shall be responsible  for the management of
its practice and the Endodontic  Office,  in accordance with the requirements of
the Laws of the State.

            3.2  Employment of the  Endodontists  and Rendering of Patient Care.
The New PC shall be responsible for the employment and professional  supervision
of Dr.  Gray and all  Endodontists  and the  other  Practice  Providers  and all
endodontic  care  rendered  to  patients  shall be rendered by Dr. Gray and such
Endodontists. Additionally, the New PC shall be responsible for the professional
supervision of all other Practice Providers in their rendering of patient care.

            3.3  Professional  Services.  The New PC shall  use and  occupy  the
Endodontic  Offices designated on Schedule 2 hereof exclusively for the practice
and rendering of endodontic services,  and shall comply with all applicable Laws
and all  standards  of  endodontic  care.  It is expressly  acknowledged  by the
parties that the endodontic  practice  conducted at the Endodontic Offices shall
be  conducted  solely by Dr. Gray and the  Endodontists  and the other  Practice
Providers  acting  under  the  supervision  and  control  of Dr.  Gray  and  the
Endodontists  (if any),  and no other  endodontist  shall be permitted to use or
occupy the Endodontic Offices. The New PC shall provide professional services to
patients  hereunder in compliance  at all times with ethical  standards and Laws
applying to the endodontic profession. The New PC shall ensure that Dr. Gray and
each Endodontist who provides endodontic services to patients is licensed by the
State. In the event that any disciplinary,  medical malpractice or other actions
are initiated  against Dr. Gray or any  Endodontist or other Practice  Provider,
the New PC shall  immediately  inform the MSO of such action and the  underlying
facts  and   circumstances   subject  to  such   confidentiality   agreement  or
arrangements  as the New PC and the MSO shall mutually  determine at or prior to
the time of such disclosure. The New PC agrees to cooperate with and participate
in  quality  assurance/utilization  review  programs  established  by the MSO or
mandated by accreditation and licensure standards  applicable to the practice of
endodontics.  Deficiencies  discovered in the performance of any personnel or in
the quality of professional  services shall be reported  immediately to the MSO,
and  appropriate  steps  shall  be taken  by the New PC at once to  remedy  such
deficiencies.

            3.4  Records.  The New PC will  keep or cause  to be kept  accurate,
complete and timely dental and other records of all patients.  The management of
all dental and patient files and records shall comply with all  applicable  Laws
regarding their confidentiality and retention and all files and records shall be
located so that they are readily  accessible for patient care,  consistent  with
ordinary  records  management  practices.  Such records  shall be  sufficient to
enable the MSO, on behalf of the New PC, to obtain  payments  for  services  and
related  charges and to facilitate  the delivery of quality  patient care by the
New PC.  Notwithstanding  the  foregoing,  patient  dental  records shall be and
remain the property of the New PC and the contents  thereof  shall be solely the
responsibility of the New PC.

            3.5 Professional  Expenses.  The New PC shall be solely  responsible
for the cost of  professional  licensure  fees  and  board  certification  fees,
membership in professional  associations and continuing  professional  education
incurred by each Endodontist and other Practice Provider employed by the New PC.
The New PC shall ensure that Dr. Gray and all the  Endodontists  employed by the
New PC participate in such continuing education as is necessary for Dr. Gray and
such the Endodontist to remain current.

            3.6 Professional  Liability Insurance.  The New PC shall provide, or
arrange  for  the  provision  of,  and  maintain  throughout  the  Term  of this
Agreement,  professional  liability  insurance  coverage in accordance  with the
provisions of Article 9 hereof.  The New PC shall also cooperate in any programs
recommended by the MSO to assure that each of its Endodontists is insurable, and
that Dr. Gray and each  Endodontist  participates in an on-going risk management
program.

            3.7 Employment Agreement. The parties recognize that the services to
be  provided  by the MSO are  feasible  only if the New PC  operates  an  active
endodontic  practice to which it, Dr. Gray and each Endodontist  associated with
the  New PC  devote  their  full  time  and  attention,  unless  other  specific
provisions  are made in writing and mutually  agreed upon by the MSO and New PC.
The New PC will cause Dr.  Gray and each  individual  Endodontist  who now is or
hereafter becomes  affiliated with the New PC to enter into a written employment
agreement (the "Employment Agreement") satisfactory in form and substance to the
MSO, pursuant to which Dr. Gray or the Endodontist shall agree not to establish,
operate or provide  endodontic  or dental  services,  without the prior  written
consent of both the New PC and the MSO, at any office or facility other than the
Endodontic Office. In addition,  such Employment  Agreement shall provide by its
own terms or by a separate  agreement  that if Dr. Gray's or such  Endodontist's
employment shall terminate for any reason during the Term of this Agreement, for
a period of 24 months after the termination of Dr. Gray's or such  Endodontist's
Employment  Agreement with the New PC, Dr. Gray or such Endodontist  shall agree
not to establish,  operate or provide endodontic or dental services, without the
prior written  consent of both the New PC and the MSO, at any office practice or
facility  whatsoever  providing services similar to those provided by the New PC
at any  endodontic  office  within a fifteen (15) mile radius.  Such  Employment
Agreement (or separate  agreement) shall also provide,  among other things, that
in the event of a breach of Dr.  Gray's or the  Endodontist's  agreement  not to
compete with the New PC provided for in such  Employment  Agreement (or separate
agreement),  the MSO shall be entitled to receive, in addition to other remedies
and not by way of an election  of  remedies,  liquidated  damages  equaling  the
greater of: (a) Dr.  Gray's or such  Endodontist's  income,  as shown on the W-2
form prepared by the New PC, for the most recent calendar year; or (b) $300,000.
Such  payment  shall  be made to the  MSO by the  New PC  immediately  following
receipt of the payment from Dr. Gray or the breaching Endodontist by the New PC.
Each of the MSO and OMEGA shall be expressly named as a third-party  beneficiary
to such agreements  between the New PC and Dr. Gray and each Endodontist and the
rights and remedies of the MSO and OMEGA  thereunder  or otherwise in respect of
the restrictive covenants set forth in such agreements shall survive termination
of this Agreement.

            3.8  Confidentiality.  The New PC agrees and  acknowledges  that all
materials   provided  by  the  MSO  to  the  New  PC  constitute   "Confidential
Information" and are disclosed in confidence and with the understanding  that it
constitutes  valuable  business  information  developed  by  the  MSO  with  the
assistance of OMEGA at great  expenditures of time, effort and money. The New PC
further agrees that it shall not,  directly or  indirectly,  without the express
prior written consent of the MSO, use or disclose such Confidential  Information
for any  purpose  other than in  connection  with the  services  to be  rendered
hereunder. The New PC further agrees: (i) to keep strictly confidential and hold
in  trust  all  Confidential  Information  and not  disclose  such  Confidential
Information to any third party, including its shareholders, directors, officers,
affiliates,  partners, employees and independent contractors without the express
prior  written  consent  of the  MSO;  and (ii) to  impose  this  obligation  of
confidentiality on its shareholders,  directors, officers, affiliates, partners,
employees  and  independent  contractors.  The  New  PC  acknowledges  that  the
disclosure of Confidential Information to it by the MSO is done in reliance upon
its  representations  and  covenants  in  this  Agreement.  Upon  expiration  or
termination of this Agreement by either party for any reason whatsoever, the New
PC shall  immediately  return  and  shall  cause  its  shareholders,  directors,
officers,  affiliates,  partners,  shareholders  and independent  contractors to
immediately return to the MSO all Confidential Information,  and the New PC will
not,  and  will  cause  its  affiliates,  partners,  employees  and  independent
contractors not to, thereafter use, appropriate,  or reproduce such Confidential
Information.  The New PC further expressly acknowledges and agrees that any such
use,  appropriation or reproduction of any such Confidential  Information by any
of the foregoing  after the  expiration or  termination  of this  Agreement will
result in  irreparable  injury to the MSO and OMEGA,  that the remedy at law for
the  foregoing  would  be  inadequate,  and that in the  event of any such  use,
appropriation,  or reproduction of any such  Confidential  Information after the
termination or expiration of this  Agreement,  the MSO and OMEGA, in addition to
any other  remedies  or damages  available  to either or both of them,  shall be
entitled to  injunctive  or other  equitable  relief  without the  necessity  of
proving  actual damages but such rights to relief shall not preclude the MSO and
OMEGA  from  other  remedies  which may be  available  to either or both of them
hereunder.

                                   ARTICLE 4
                PROFESSIONAL SERVICES, CONTROL OF SOLICITATION,
             APPROVAL OF ADVERTISING MATERIAL AND NO RECIPROCATION

            4.1 A fundamental  understanding  between the parties hereto is that
the rendering of endodontic  services shall be separate and independent from the
provision of  administrative,  management and support services by the MSO. Thus,
the  New PC  shall  have  sole  and  absolute  control  of the  delivery  of all
professional  services  and  treatment  rendered to  patients at the  Endodontic
Offices.

            4.2 No employee or other  representative of the MSO shall be engaged
in, or allowed to solicit  patients  on behalf of, the New PC, nor shall the MSO
have any control over the New PC's patients.

            4.3 No advertising or promotional  materials,  or other materials of
any  nature,  including  billing  and  collection  forms,  reports,  agreements,
correspondence,  or similar materials,  used in connection with the New PC shall
be used or distributed without having first been approved by the New PC.

            4.4 The  parties  hereby  acknowledge  and agree  that the  benefits
conferred  upon  each  of  them  hereunder  neither  require  nor are in any way
contingent  upon  the  admission,   recommendation,   referral,   or  any  other
arrangement  for the provision of any item or service  offered by the MSO to any
patients  of the New PC or its  shareholders,  officers,  directors,  employees,
contractors  or agents,  nor are such  benefits in any way  contingent  upon the
recommendation,  referral or any other arrangement for the provision of any item
or service  offered by the New PC or any of its Practice  Providers,  employees,
contractors or agents.

                                   ARTICLE 5
                    LEASE OF OFFICE FACILITIES AND EQUIPMENT

            5.1 In  consideration  of the sums to be paid to the MSO  under  the
terms of this Agreement, the MSO hereby leases or sub-leases,  as applicable, to
the New PC during the Term of this  Agreement the  Endodontic  Offices,  and the
leasehold  improvements and fixtures,  furniture and equipment at the Endodontic
Offices  as  listed  from  time  to time  on  Schedule  2  attached  hereto  and
incorporated herein by this reference, under the following terms and conditions:

            (a) The MSO is the lessee by assignment under lease for the premises
occupied by the New PC  (collectively,  the  "Master  Lease") a copy of which is
attached hereto as Exhibit A and incorporated herein by this reference.  The New
PC hereby  acknowledges  that the premises  described under the Master Lease are
suitable for the New PC's endodontic practice. Based and contingent upon the New
PC's promise to timely pay all amounts due under this Agreement,  the MSO hereby
agrees to sublease the leased  premises to the New PC upon the  following  terms
and conditions:

                  (i)  This  sublease  between  the  MSO  and  the New PC of the
premises  shall be  subject  to all of the terms and  conditions  of the  Master
Lease. In the event of the termination of the MSO's interest as lessee under the
Master  Lease  for  any  reason,   then  the  sublease   created   hereby  shall
simultaneously  terminate,  unless the New PC assumes the obligations  under the
Master Lease in question and the Lessor consents thereto.

                  (ii) All of the terms and  conditions  contained in the Master
Lease are incorporated herein as terms and conditions of the sublease (with each
reference therein to "Lessor" and "Lessee," to be deemed to refer to the MSO and
the New PC,  respectively) and, along with the provisions of this Section 5.1(b)
and Exhibit  "A," shall be the  complete  terms and  conditions  of the sublease
created hereby.

                  (iii)  Notwithstanding  the foregoing,  as between the MSO and
the New PC, the MSO shall  remain  responsible  for meeting the  obligations  of
"Lessee" under the sections entitled Rent, Additional Rent Adjustment, Insurance
on Fixtures, Liability Insurance, Repairs, and Taxes of the Master Lease, all of
which  obligations  shall be  considered  MSO Expenses  hereunder and the New PC
shall have no monetary  obligation in that regard.  In addition,  as between the
MSO and the New PC, the MSO shall  retain the right to  exercise  any options to
purchase the premises, or other similar rights of ownership or possession, which
may be granted  under the Master  Lease,  and the New PC shall have no rights in
that regard.

                  (iv) In the event this  Agreement is  terminated  according to
its terms, this sublease shall also terminate automatically.

                  (v) If the Master Lease  contains an option to Renew the terms
thereof,  the MSO  shall  notify  the New PC,  at  least  30 days  prior  to the
expiration of the time for  exercising  such option,  of the MSO's  intention to
Renew or not to Renew such term. If the MSO  determines  not to Renew such term,
the MSO shall provide or arrange for the  provision of  comparable  office space
(the  "Substitute  Endodontic  Office")  within  a  radius  of 15  miles  of the
Endodontic  Office,  which Substitute  Endodontic Office shall be subject to the
approval of the New PC (which  approval  shall not be  unreasonably  withheld or
delayed).  The lease or  sublease  for such  Substitute  Endodontic  Office,  as
applicable, shall be substituted for the lease described on Exhibit A hereto and
all references to the "Master Lease" shall thereafter be applicable to the lease
or sublease for the Substitute Endodontic Office for purposes of this Agreement,
ab initio.

                  (vi) The Alternative  Dispute Resolution  provisions set forth
in Article 14 of this  Agreement  shall not apply to any issues  concerning  the
Sub-Lease, the New PC's tenancy or the MSO's rights and remedies as Sub-Lessor.

            5.2 The MSO shall provide the New PC at the Endodontic  Offices such
additional  leasehold  improvements,   fixtures,   furniture,   furnishings  and
equipment as may be mutually  agreed to with the New PC and reflected  from time
to time on a  supplement  to  Schedule  2  hereto.  The use by the New PC of all
leasehold improvements,  fixtures, furniture, furnishings and equipment provided
hereunder shall be subject to the following conditions:

            (a) Title to all such leasehold improvements, fixtures, furnishings,
furniture and  equipment  shall remain in the MSO and upon  termination  of this
Agreement,  the New PC shall immediately return and surrender all such leasehold
improvements,  fixtures,  furniture,  furnishings and equipment to the MSO in as
good condition as when received, normal wear and tear excepted.

            (b) The MSO shall be fully and entirely  responsible for all repairs
and  maintenance  of  all  such  leasehold  improvements,  fixtures,  furniture,
furnishings  and equipment;  provided,  however,  that the New PC agrees that it
will use its best efforts to prevent  damage,  excessive  wear, and breakdown of
all such leasehold improvements, fixtures, furniture, furnishings and equipment,
and shall advise the MSO of any and all needed repairs and equipment failures.

            (c) The obligation of the MSO to provide the leasehold improvements,
fixtures, furniture, furnishings and equipment stated herein shall be concurrent
and co-extensive with the Term of this Agreement.

            5.3.   No Warranty.

            (a) THE NEW PC  ACKNOWLEDGES  THAT THE MSO  MAKES NO  WARRANTIES  OR
REPRESENTATIONS,  EXPRESS OR IMPLIED,  AS TO THE  SUITABILITY OR ADEQUACY OF ANY
LEASEHOLD IMPROVEMENTS,  FIXTURES, FURNITURE, FURNISHINGS,  EQUIPMENT, INVENTORY
OR SUPPLIES  PROVIDED OR LEASED OR SUBLEASED  PURSUANT TO THIS AGREEMENT FOR THE
CONDUCT OF AN ENDODONTICS PRACTICE OR FOR ANY OTHER PARTICULAR PURPOSE.

            (b) Nothing in this Agreement  shall be construed to affect or limit
in any way the professional  discretion of the Practice  Providers to select and
use  fixtures,  furniture,  furnishings  and  equipment,  inventory and supplies
purchased  or  provided by the MSO in  accordance  with the  provisions  of this
Agreement  insofar as such selection or use constitutes or might  constitute the
practice of dentistry or endodontics.

                                   ARTICLE 6
                                  COMPENSATION

      As consideration  for the performance of all of its duties and obligations
as  provided  in this  Agreement,  including  but not  limited to, the costs and
expenses  associated  with  furnishing  the  services,  personnel,   facilities,
leasehold improvements, fixtures, furniture, furnishings, equipment, inventories
and supplies provided for herein, the MSO shall receive compensation in the form
of monthly  management fees (the  "Management  Fees") based upon a predetermined
percentage of the "Practice  Revenues",  as defined and determined in accordance
with the  provisions  set forth in Schedule 3 attached  hereto and  incorporated
herein by this reference,  as such Schedule may be amended by the New PC and the
MSO from time to time. It is acknowledged by and between the parties hereto that
the MSO and/or its  affiliates  has (have)  incurred  substantial  expenses  and
future  obligations  in  acquiring  the capital  stock of the MSO,  acquiring or
otherwise  establishing  the  Endodontic  Offices,   establishing  its  systems,
including fees for consultants and other professionals,  interest expense, lease
obligations,  and costs of furnishing or refurbishing  the premises at which the
Endodontic Offices are located. The MSO has also assumed substantial obligations
associated with the continuing  operation of the Endodontic  Offices,  including
those of lessee,  obligor and  guarantor  and obligor on loans to establish  and
operate the  Endodontic  Offices.  The  parties,  therefore,  having  considered
various compensation  formulae,  acknowledge and agree that in order for the MSO
to receive a fair and reasonable return for its expenses and obligations,  and a
fair return for the lease of the premises and  equipment  and for  providing the
services contemplated hereunder,  that the agreed compensation is not excessive.
The New PC acknowledges  that the  compensation  arrangement is reasonable under
the circumstances  noted herein and has executed an Affidavit  attesting to this
fact  which  is  attached  hereto  and  incorporated  herein  as  Exhibit  C. In
consideration  of the foregoing,  the parties agree that the monthly  Management
Fees  payable to the MSO by the New PC for  services  rendered  pursuant to this
Agreement  shall be reviewed and subject to adjustment at the close of each year
of the Term of this Agreement based upon industry  standards of practice and the
MSO's costs in performing  the required  services.  If the parties  cannot agree
within  thirty (30) days prior to the close of any such year on the terms of any
adjustment to the Management Fees for the following year, then the then existing
Management Fees shall remain in effect. The New PC specifically  agrees that the
MSO may defer actual  receipt of its  Management  Fees and/or advance monies for
purposes of managing  the New PC's cash flow,  and the MSO may repay itself such
advances or pay said deferred Management Fees when it deems appropriate.

                                   ARTICLE 7
                               SECURITY INTEREST

      As  assurance  and  collateral  security  for the  payment of the  monthly
Management  Fees  owed  to the MSO  pursuant  to this  Agreement  and any  funds
advanced by the MSO to or on behalf of the New PC pursuant to this Agreement and
for the faithful and timely  performance  of all the covenants and conditions to
be  performed  by the New PC under this  Agreement,  the New PC hereby  pledges,
grants, bargains, assigns and transfers to the MSO a security interest, pursuant
to the Uniform  Commercial Code of the State, in and to all Practice Revenue and
accounts  receivable  of  patients  of the New PC,  together  with all  proceeds
thereof  (collectively,  the  "Collateral"),  and further  agrees not to pledge,
assign,  transfer or convey any of the  Collateral  or any  proceeds  therefrom,
without the prior written  consent of the MSO,  except to affiliates of the MSO.
Concurrent  with the  execution of this  Agreement,  the New PC shall  execute a
Security  Agreement,  similar  in form and  content as that  attached  hereto as
Exhibit D and  incorporated  herein by this  reference in order that the MSO may
perfect its interest in the Collateral.  The New PC expressly  agrees to execute
any  appropriate  UCC-1  Financing  Statement and UCC-1 Fixture  filings,  if so
requested in writing by the MSO.

                                   ARTICLE 8
                                   COVENANTS

            8.1 New PC's  Covenants.  As  further  consideration  for the  MSO's
performance of the terms and conditions of this Agreement, the New PC covenants,
represents  and  warrants  as  follows  (which  covenants,  representations  and
warranties shall survive the execution of this Agreement):

            (a)  The  New  PC  shall  comply  with  all  Laws  and  ethical  and
professional  standards  applicable to the practice of endodontics  and to cause
all of its employees to do the same.

            (b) The New PC shall  provide  quality  services and shall cause Dr.
Gray and the Endodontists (if any) to serve the endodontic needs of the patients
of the New PC.  The New PC  covenants  to  monitor  rigorously  utilization  and
quality of services provided at the Endodontic  Offices and shall take all steps
necessary to remedy any and all deficiencies in the efficiency or the quality of
endodontic care provided.

            (c)  During  the  Term of this  Agreement,  the  New PC  shall  not,
directly or indirectly, own an interest in, operate, join, control,  participate
in  or  be   connected  in  any  manner  with  any   corporation,   partnership,
proprietorship, firm, association, person or entity providing endodontic care in
competition with the practice at the Endodontic Offices, or any other endodontic
practice  managed  by the MSO,  within a  radius  of 15 miles of the  Endodontic
Office or of such other  endodontic  practice,  without the MSO's prior  written
consent.

            (d) The New PC recognizes the  proprietary  interest of OMEGA in and
to its OMEGA Patient  Scheduling  System and the MSO in its systems for managing
the delivery of endodontic care and all policies, procedures, operating manuals,
forms,  contracts and other information  (collectively,  the "MSO  Information")
regarding such system.  The New PC acknowledges  and agrees that all information
relating  to the  OMEGA  Patient  Scheduling  System  and  the  MSO  Information
constitutes  trade secrets of OMEGA and/or the MSO. The New PC hereby waives any
and all right,  title and  interest  in and to such trade  secrets and agrees to
return all copies of such trade secrets and information relating thereto, at its
expense, upon termination of this Agreement.

            (e) The New PC  acknowledges  and agrees  that OMEGA and the MSO are
entitled to prevent their  respective  competitors  from obtaining and utilizing
their respective trade secrets.  The New PC agrees to hold OMEGA'S and the MSO's
trade secrets in strictest  confidence and not to disclose them or allow them to
be disclosed  directly or  indirectly to any person or entity other than persons
who are engaged by the New PC to perform  duties in  connection  with the New PC
and who have a need to know  such  trade  secrets  in the  performance  of their
duties for the New PC, without  OMEGA's or the MSO's prior written  consent,  as
the case may be. The New PC acknowledges its fiduciary  obligations to OMEGA and
the MSO and the  confidentiality of its relationships with OMEGA and the MSO and
of any  information  relating to the services and business  methods of OMEGA and
the MSO which it may obtain during the term of this Agreement.  The New PC shall
not,  either  during  the  term of  this  Agreement  or at any  time  after  the
expiration  or  sooner  termination  hereof,  disclose  to  anyone,  other  than
employees or  independent  contractors  of OMEGA and the MSO who use OMEGA's and
the  MSO's  system  in the  course  of the  performance  of  their  duties,  any
confidential or proprietary information or trade secrets obtained by the New PC.
The New PC also  agrees  to  place  any  persons  to whom  said  information  is
disclosed for the purpose of  performance  under legal  obligation to treat such
information as strictly confidential.

            8.2  MSO's  Covenants.  As  further  consideration  for the New PC's
performance  of the terms and conditions of this  Agreement,  the MSO covenants,
represents and warrants (which covenants,  representations  and warranties shall
survive the execution of this Agreement) that during the Term of this Agreement,
the MSO agrees not to establish, develop or open any offices in affiliation with
an endodontist for the provision of endodontic  services within a 15 mile radius
of the Endodontic Offices, without the express written consent of the New PC.

                                   ARTICLE 9
                            INSURANCE AND INDEMNITY

            9.1 Insurance to be Maintained by the New PC. Throughout the Term of
this Agreement, the New PC shall maintain in full force and effect comprehensive
professional  liability  insurance  with  limits of not less than  $500,000  per
occurrence  and  $1,000,000  annual  aggregate  per  Dr.  Gray  and  each of the
Endodontists  providing services for the New PC and a separate limit for the New
PC. The New PC shall be responsible for all liabilities  within  deductibles and
for all liabilities in excess of the limits of such policies.  The MSO agrees to
negotiate for and cause premiums to be paid on behalf of the New PC with respect
to such insurance.  Premiums and deductibles with respect to such policies shall
not be MSO  Expenses.  The  New PC also  agrees  to name  the MSO and  OMEGA  as
co-insureds.  The New PC agrees to deliver to the MSO and OMEGA a certificate of
insurance indicating such coverage.

            9.2 Insurance to be Maintained  by the MSO.  Throughout  the Term of
this Agreement,  the MSO will use reasonable efforts to provide and maintain, as
a MSO  Expense,  (a)  comprehensive  professional  liability  insurance  for all
professional  employees of the MSO with limits as  determined  reasonable by the
MSO; and (b) comprehensive general liability and property insurance covering the
Endodontic Office premises and operations.

            9.3 Tail Insurance Coverage. The New PC will cause Dr. Gray and each
Endodontist (if any) providing  services to enter into an agreement with the New
PC that upon termination of Dr. Gray's or such  Endodontist's  relationship with
the New PC, for any reason,  tail  insurance  coverage  will be purchased by Dr.
Gray or such  Endodontist.  Such  provisions  may be contained in an  employment
agreement, restrictive covenant agreement or other agreement entered into by the
New PC and Dr. Gray or the Endodontist, and the New PC hereby covenants with the
MSO to enforce such  provisions  relating to the tail  insurance  coverage or to
provide  such  coverage  at the  expense of the New PC or Dr.  Gray or each such
Endodontist.

            9.4 Additional  Insureds.  The New PC and the MSO agree to use their
reasonable  efforts to have each  other  named as an  additional  insured on the
other's respective liability insurance policies.

            9.5 Indemnification.  The New PC shall indemnify,  hold harmless and
defend the MSO and OMEGA and their respective officers, directors, shareholders,
employees and representatives,  from and against any and all liability,  losses,
damages, claims, causes of action, expenses judgments, settlements, lawsuits and
obligations  (including  reasonable  attorneys' fees), whether or not covered by
insurance, caused or asserted to have been caused, directly or indirectly, by or
as a result of the performance of endodontic  services or the performance of any
intentional  acts,  negligent  acts  or  omissions  by  the  New PC  and/or  its
affiliates,  its  shareholders,   agents,  the  Practice  Providers,  its  other
employees and/or its subcontractors (other than the MSO) during the Term hereof.
The MSO shall  indemnify,  hold  harmless  and defend the New PC, its  officers,
directors,  shareholders and employees,  from and against any and all liability,
loss,  damage,  claim,  causes of action,  and  expenses  (including  reasonable
attorneys'  fees),  caused  or  asserted  to  have  been  caused,   directly  or
indirectly,  by or as a  result  of the  performance  of any  intentional  acts,
negligent  acts  or  omissions  by the  MSO  and/or  its  shareholders,  agents,
employees and/or subcontractors (other than the New PC) during the Term hereof.

                                   ARTICLE 10
                                  TERMINATION

            10.1 Termination by the New PC.

            (a)  Termination  by the  New  PC.  The  New PC may  terminate  this
Agreement as follows:

                  (1) In the event of the  filing  of a  petition  in  voluntary
bankruptcy  or an  assignment  for the benefit of  creditors by the MSO, or upon
other action taken or suffered, voluntarily or involuntarily,  under any federal
or state law for the  benefit of debtors by the MSO,  except for the filing of a
petition in  involuntary  bankruptcy  against the MSO which is dismissed  within
sixty (60) days thereafter,  the New PC may give written notice of the immediate
termination of this Agreement.

                  (2) In the  event  the MSO  shall  materially  default  in the
performance of any duty or obligation imposed upon it by this Agreement and such
default  shall  continue  for a period of sixty (60) days after  written  notice
thereof has been given to the MSO by the New PC, the New PC may  terminate  this
Agreement.

            Upon termination of this Agreement by the Endodontic  Practice under
this Section 10.1,  the New PC shall be entitled to exercise the "Call  Option,"
as  defined  in and on the terms and  conditions  set forth in Section 3 of that
certain Stock Put/Call  Option and Successor  Designation  Agreement (the "Stock
Put/Call  Option and  Successor  Designation  Agreement")  dated as of even date
herewith, by and among the New PC, Dr. Gray and the Endodontists (if any), OMEGA
and the MSO.

            10.2  Termination  by  MSO.  MSO may  terminate  this  Agreement  as
follows:

            (a) In the event of the filing of a petition in voluntary bankruptcy
or an assignment for the benefit of creditors by the New PC or any  shareholders
thereof,  or upon other action taken or suffered,  voluntarily or involuntarily,
under any  federal or state law for the  benefit of debtors by the New PC or any
shareholders  thereof,  except  for the  filing  of a  petition  in  involuntary
bankruptcy  against the New PC or any  shareholder  thereof  which is  dismissed
within sixty (60) days thereafter,  MSO may give written notice of the immediate
termination of this Agreement.

            (b) In the event the New PC fails to perform endodontic  services on
a full-time  basis  consistent  with its pattern of practice in the  immediately
preceding calendar year and such default shall continue for a period of ten (10)
days after written  notice  thereof has been given to the New PC by the MSO, the
MSO may terminate this Agreement.

            (c)  In the  event  the  New  PC  shall  materially  default  in the
performance of any other duty or obligation  imposed upon it by this  Agreement,
and such default  shall  continue for a period of sixty (60) days after  written
notice  thereof has been given to the New PC by the MSO,  the MSO may  terminate
this Agreement.

            (d) In the event Dr.  Gray or any  Endodontist  breaches or defaults
under his or her Employment  Agreement and the New PC does not cause Dr. Gray or
such  Endodontist  to cure such breach or default  within any  applicable  grace
period therefor, the MSO may give written notice of the immediate termination of
this Agreement.

            Upon  termination  of this  Agreement  by the MSO under this Section
10.2 or upon expiration of the Term of this  Agreement,  the MSO and OMEGA shall
be entitled to  exercise  the "Put  Option"  and/or the  "Successor  Designation
Option," as defined in and on the terms and subject to the  conditions set forth
in Sections 2 and 5, respectively,  of the Stock Put/Call Option and Designation
Agreement.  In  addition,  upon  any  termination  of  this  Agreement  or  upon
expiration of the Term of this  Agreement,  the MSO shall be entitled to receive
the  Management  Fees  collected to the effective  date of such  termination  or
expiration,  the  amounts of any loans or  advances  (including  any accrued but
unpaid  interest  thereon) and all other sums accrued or related to  occurrences
arising at or prior to the date of termination.

                                   ARTICLE 11
                    AUTHORIZED AGENT AND POWERS OF ATTORNEY

            The  New PC  hereby  designates  the MSO  (and  its  designees)  its
authorized  agent  and  lawful   attorney-in-fact  for  purposes  of  depositing
payments,  paying accounts  payables,  signing  checks,  negotiating and signing
contracts  for services or goods,  securing  loans or incurring  obligations  on
behalf of the New PC;  provided,  however,  that all  contracts  or fees set for
services  on  behalf  of the  New PC will  be  subject  to  final  approval  and
acceptance by the New PC.  Additionally,  the New PC hereby irrevocably appoints
the MSO (and its designees) its authorized agent and lawful  attorney-in-fact to
collect all bills and accounts  receivable for  professional  fees,  charges and
other amounts and authorizes the MSO through its designees to take possession of
all  checks,  money  orders  and  similar  instruments  received  as  payment of
receivables  to be  deposited  into  the  New PC  Account.  The  New  PC  hereby
irrevocably appoints the MSO as the New PC's  attorney-in-fact,  with full power
and authority in the place and stead of the New PC, in the MSO's discretion,  to
endorse  in the  name  of the  New PC any  checks,  payments,  notes,  insurance
payments and money orders, to withdraw funds for payments of expenses, including
Management  Fees and other sums payable to the MSO, to open and close the New PC
Account  and other bank  accounts,  to take any action and to execute  any other
instrument  which the MSO may deem  necessary  or advisable  to  accomplish  the
purposes  hereof.  The powers of attorney  granted  herein are  coupled  with an
interest and are irrevocable. Third parties and entities and persons not a party
to this Agreement are entitled to rely on the foregoing attorneys-in-fact and an
affidavit of the MSO attesting  thereto.  The acceptance of this  appointment by
the MSO shall not  obligate it to perform  any duty or  covenant  required to be
performed  by the New PC under or by virtue of this  Agreement.  Notwithstanding
the foregoing  powers of attorney,  the New PC shall at any time, on the request
of the MSO, sign financing  statements,  security agreements or other agreements
necessary or advisable to accomplish the purpose of this Agreement. Upon the New
PC's failure to sign said  financing  statements,  security  agreements or other
agreements,  the MSO is  authorized  as the agent of the New PC to sign any such
instruments. The New PC may review all deposits and expenses upon request.

                                   ARTICLE 12
                      INDEPENDENT CONTRACTOR RELATIONSHIP

            Neither the New PC nor its employees shall have any claim under this
Agreement or otherwise against the MSO for worker's  compensation,  unemployment
compensation,  sick leave,  vacation pay, retirement  benefits,  Social Security
benefits,  or any  other  employee  benefits,  all of  which  shall  be the sole
responsibility  of the New PC. Since  neither the New PC nor its  employees  are
employees  of the MSO,  the MSO  shall  not  withhold  on  behalf  of the New PC
unemployment  insurance,  Social Security,  or otherwise  pursuant to any law or
requirement of any  governmental  agency,  and all such  withholding,  if any is
required, shall be the sole responsibility of the New PC.

                                   ARTICLE 13
                                 MISCELLANEOUS

            13.1 Access to Records.  From and after any termination,  each party
shall provide the other party with  reasonable  access to books and records then
owned by it to permit such requesting party to satisfy reporting and contractual
obligations which may be required of it.

            13.2 Patient Records. Upon termination of this Agreement, the New PC
shall retain all patient dental  records  maintained by the New PC or the MSO in
the name of the New PC. During the term of this Agreement,  and thereafter,  the
New PC or its designee shall have reasonable access during normal business hours
to the New PC's and the MSO's records, including, but not limited to, records of
collections,  expenses and  disbursements  as kept by the MSO in performing  the
MSO's obligations under this Agreement,  and the New PC may copy any or all such
records.

            13.3  The  New  PC's   Control   Over   the   Endodontic   Practice.
Notwithstanding  the authority granted to the MSO herein, the MSO and the New PC
agree that the New PC, personally or through Dr. Gray or any of its Endodontists
(if  any)  and  other  Practice  Providers,  shall  have  complete  control  and
supervision over the professional  aspects of the New PC's practice,  as well as
the provision of all professional services,  including,  without limitation, the
selection of a course of treatment for a patient, the procedures or materials to
be used as a part of such  course of  treatment,  and the  manner in which  such
course of  treatment  is  carried  out by the New PC. The New PC shall have sole
authority to direct the business,  professional,  and ethical aspects of the New
PC. The MSO shall have no authority,  directly or  indirectly,  to perform,  and
shall not  perform,  any  endodontic  function,  or to  influence  or  otherwise
interfere with the exercise of the New PC's professional  judgment. The MSO may,
however,  advise the New PC as to the  relationship  between its  performance of
endodontic functions and the overall  administrative and business functioning of
the New PC.

                                   ARTICLE 14
                         ALTERNATIVE DISPUTE RESOLUTION

            14.1 Alternative Dispute Resolution.

            (a) If a  dispute  arises  under  this  Agreement  which  cannot  be
resolved  informally  by the parties,  any party may invoke the  procedures  set
forth in Exhibit E hereto and the parties agree to use these procedures,  except
paragraph (b) of this Section 14.1,  prior to any party pursuing other available
remedies.  The  parties  will meet and  attempt  in good  faith to  resolve  any
controversy or claim arising out of or relating to this Agreement.

            (b) Notwithstanding anything in this Section 14.1 to the contrary:

            (i)  Nothing  in this  Section  14.1 shall  preclude  any party from
seeking a preliminary injunction or other provisional relief, either prior to or
during the  proceeding  provided for in this  section,  if in its judgment  such
action is necessary to avoid irreparable damage or to preserve the status quo.

            (ii) The  parties  shall  accept  as  correct,  final,  binding  and
conclusive the determination by the outside accountants then employed by the MSO
as to the  calculation of any and all Management  Fees owed by the New PC to the
MSO hereunder,  and such determination shall not be subject to the provisions of
this Section 14.1. Disputes as to the proper interpretation of the provisions of
this Agreement  which describe how those amounts are to be calculated,  however,
shall be subject to the provisions of this Section 14.1.

            (iii) Any  determination by either party not to Renew this Agreement
in  accordance  with the terms and  provisions  of this  Agreement  shall not be
subject to the provisions for dispute resolution in this Section 14.1.

            14.2 Waiver of Jury. With respect to any dispute arising under or in
connection  with this  Agreement  or any  related  agreement,  as to which legal
action  nevertheless  occurs, each party hereby irrevocably waives all rights it
may have to demand a jury trial.  This waiver is  knowingly,  intentionally  and
voluntarily  made by the  parties  and each  party  acknowledges  that no person
acting  on behalf of the  other  party  has made any  representation  of fact to
induce this  waiver of trial by jury or in any way  modified  or  nullified  its
effect.  The parties each further  acknowledge  that it has been represented (or
has had the  opportunity to be represented) in the signing of this Agreement and
in the making of this waiver by independent  legal counsel,  selected of its own
free will,  and that it has had the  opportunity  to discuss  this  waiver  with
counsel.  Each party further  acknowledges  that it has read and understands the
meaning and ramifications of this waiver provision.

                                   ARTICLE 15
                               GENERAL PROVISIONS

            15.1  Notices.  Any notice to be given  pursuant  to this  Agreement
shall be  deemed  effective  if given  personally,  or by  telephone,  telegram,
telecopy, facsimile or other electronic transmission, or by letter to an officer
or  administrator of OMEGA, the MSO or the New PC, as the case may be. Notice in
person,  or by telephone,  telegram or electronic  transmission  shall be deemed
effective when given. Notice by mail shall be deemed effective  seventy-two (72)
hours after  deposit in the United  States mails,  and properly  addressed  with
postage prepaid.

      Notices to the New PC shall be given as follows:

               4101 Caughlin Square - Suite 2
               Reno, Nevada 89509
               Attn: Rodney A. Gray, D.D.S.

or such other  address as may be furnished by the New PC to the MSO from time to
time in writing.

      Notices to OMEGA and/or the MSO shall be given as follows:

               Omega Orthodontics, Inc.
               3621 Silver Spur Lane
               Acton, CA 93510
               Attn: Robert Schulhof

or other such  addresses  as may be furnished by the MSO to the New PC from time
to time in writing.

            15.2  Confidentiality.  No 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 parties (past, present or future)
that was obtained in the course of the  negotiation  of this Agreement or in the
course of the  performance  of this  Agreement,  without  the other  party's  or
parties' (as the case may be) written approval; provided, however, the foregoing
shall  not  apply to  information  which is  required  to be  disclosed  by Law,
including federal or state securities laws, or pursuant to court order.

            15.3 Contract  Modifications  for Prospective  Legal Events.  In the
event any state or federal Laws,  now existing or enacted or  promulgated  after
the effective date of this Agreement,  are interpreted by judicial  decision,  a
regulatory  agency  or legal  counsel  for both  parties  in such a manner as to
indicate that the structure of this  Agreement may be in violation of such Laws,
the New PC and the MSO shall amend this  Agreement as necessary.  To the maximum
extent possible,  any such amendment shall preserve the underlying  economic and
financial arrangements between the New PC and the MSO.

            15.4 Remedies  Cumulative.  No remedy set forth in this Agreement or
otherwise conferred upon or reserved to any party shall be considered  exclusive
of any other  remedy  available  to any party,  but the same shall be  distinct,
separate  and  cumulative  and may be  exercised  from  time to time as often as
occasion may arise or as may be deemed expedient.

            15.5 No Obligation to Third  Parties.  None of the  obligations  and
duties of the MSO or the New PC under this Agreement  shall in any way or in any
manner be deemed to create any obligation of the MSO or of the New PC to, or any
rights in, any person or entity not a party to this  Agreement  other than OMEGA
which  shall  be  deemed  a party  for  limited  purposes  as set  forth in this
Agreement.

            15.6 Entire  Agreement.  This Agreement  including the Schedules and
Exhibits  hereto,   together  with  the  Stock  Put/Call  Option  and  Successor
Designation  Agreement  of even date  herewith and the  Employment  Agreement(s)
(including the related non-competition agreements or covenants), constitutes the
entire  agreement  between the  parties  concerning  this  subject  matter,  and
supersedes  all  prior  and  contemporaneous  agreements,   representations  and
understandings  of the parties  concerning the contents  hereof.  No supplement,
modification, or amendment to this Agreement shall be binding unless executed in
writing by all of the parties hereto,  except as otherwise  provided herein.  No
waiver of any of the provisions of this Agreement  shall be deemed to constitute
a waiver of any other provision,  whether similar or not similar,  nor shall any
waiver  constitute  a  continuing  waiver.  No waiver  shall be  binding  unless
executed in writing by the party making the waiver.

            15.7 Assignment. The rights and the duties of the parties under this
Agreement may not be assigned or transferred  without the prior written  consent
of the non-assigning  party,  which consent shall not be unreasonably  withheld;
provided,  however,  that the MSO shall be  permitted  to assign  its rights and
obligations  hereunder without the consent of the New PC to any person,  firm or
corporation  controlled by the MSO,  controlling the MSO or under common control
with the MSO.

            15.8 Attorneys' Fees. If any mediation or arbitration or other legal
action or  proceeding  is  brought  to enforce  this  Agreement,  because of any
alleged  breach  hereof,  or for a  declaration  of any rights  and  obligations
hereunder,  the  prevailing  party in such mediation or  arbitration,  action or
proceeding  shall be entitled to recover its costs incurred  therein,  including
reasonable  attorneys'  fees, in addition to any other relief to which it may be
entitled,  all as determined  and awarded by the parties in such mediation or by
the arbitrator or court as part of its judgment or decision therein, as the case
may be.

            15.9  Governing  Law.  This  Agreement  shall  be  governed  by  and
construed in accordance with the laws of the State. The parties acknowledge that
the MSO is not  authorized  or qualified to engage in any activity  which may be
construed or deemed to constitute the practice of dentistry or  endodontics.  To
the extent any act or service  required of the MSO in this  Agreement  should be
construed  or  deemed,  by  any  governmental  authority,  agency  or  court  to
constitute the practice of dentistry or endodontics, the performance of said act
or service by the MSO shall be deemed waived and forever  unenforceable  and the
provisions of Section 15.14 shall be applicable.

            15.10 Events Excusing Performance.  Neither party shall be liable to
the other party for failure to perform any of the  services  required  herein in
the event of strikes,  lock-outs,  calamities,  acts of God,  unavailability  of
supplies  or other  events  over which that party has no control  for so long as
such events continue, and for a reasonable period of time thereafter.

            15.11  Compliance  with  Applicable  Laws. Both parties shall comply
with all applicable Laws and restrictions  imposed  thereunder in the conduct of
their obligations under this Agreement.

            15.12 Language Construction. The parties acknowledge that each party
and its counsel have  reviewed and revised  this  Agreement  and that the normal
rule of  construction  to the effect  that any  ambiguities  are to be  resolved
against the drafting party shall not be employed in the  interpretation  of this
Agreement.

            15.13 Amendments.  This Agreement may be amended only by the written
consent of both parties.

            15.14 Severability.  In the event any provision of this Agreement is
held by a court of competent  jurisdiction to be illegal or  unenforceable,  (i)
the  parties  shall  amend this  Agreement  in order to carry out the intent and
essential  business  purposes of this Agreement as closely  possible  within the
requirements of applicable  provisions of Law as determined by such a court, and
(ii) the remaining provisions of this Agreement shall continue in full force and
effect.

            15.15 No Waiver. The waiver by either party to this Agreement of any
one or more  defaults,  if any,  on the part of the  other  party,  shall not be
construed  to  operate  as a waiver of the other or future  defaults  under this
Agreement.

            15.16  Captions.  Captions to paragraphs  in this  Agreement are for
ease  of  reference,  and  shall  not be  considered  an  interpretation  of the
paragraph.

            15.17 Counterparts. This Agreement may be executed simultaneously in
one or more counterparts, each of which shall be deemed an original.

            IN WITNESS WHEREOF,  the parties hereto have executed this agreement
as of the day and year first above written.

                                    NEW PC:



                                    By:_______________________________
                                        Name:  Rodney A. Gray
                                        Title: President


                                    MSO:
                                    OMEGA ORTHODONTICS OF RENO, INC.



                                    By:_______________________________
                                        Name:  Robert J. Schulhof
                                        Title: President


                                    OMEGA:
                                    OMEGA ORTHODONTICS, INC.



                                    By:_______________________________
                                        Name:  Robert J. Schulhof
                                        Title: President

<PAGE>
                                   SCHEDULE 1

                                THE ENDODONTISTS


Name and Address

Rodney A. Gray, D.D.S.
4101 Caughlin Square - Suite 2
Reno, Nevada 89509

<PAGE>
                                   SCHEDULE 2

                        ENDODONTIC OFFICES AND SERVICES


                           [Dr. Gray Attach]
<PAGE>
                                   SCHEDULE 3

                         COMPENSATION - MANAGEMENT FEES

      The MSO shall receive,  as compensation  for the performance of all of its
obligations and duties contained in the Agreement, monthly Management Fees in an
amount equal to Seventy-Five Percent (75%) of the Practice Revenues, and the New
PC shall be entitled to  Twenty-Five  Percent (25%) of such  Practice  Revenues,
except  as the  parties  may  otherwise  agree  from  time to  time in  writing;
provided,  however, that in no event shall the MSO receive less than $200,000 in
Management Fees annually. At the end of each twelve (12) month period during the
Term, the MSO shall provide the New PC with an unaudited internal  accounting of
the MSO Expenses,  prepared in accordance with the accrual method of accounting.
If the MSO Expenses as reflected in such  accounting  as having been paid by the
MSO are less than sixty (60%)  percent of the Practice  Revenues for such twelve
month period,  fifty (50%) percent of such  difference  shall be returned by the
MSO to the New PC as a  profit  incentive  rebate  (the  "Rebate").  If such MSO
Expenses  are more than sixty (60%)  percent of the  Practice  Revenues for such
twelve month  period,  fifty (50%) percent of such excess will be charged to the
New PC and  set  off  against  payments  due to  the  New PC  hereunder.  If the
Agreement to which this  Schedule 3 is attached is  terminated  or expires,  the
foregoing  Management  Fees shall be  payable  to the MSO based on all  Practice
Revenue collected as of the date of termination or expiration.

      Payment  to the MSO  shall be made in  monthly  installments  based on the
Practice Revenues realized by the MSO for services rendered  hereunder.  The MSO
shall  distribute the proceeds from the New PC Account and allocate the proceeds
between the MSO and the New PC as described  above, on or before the 15th day of
the succeeding  month.  In the event the 15th day falls on a weekend or holiday,
then said  distribution  shall be made on the next  business  day.  The  parties
hereto may agree to handle such matters in a different manner.

      For  purposes  of this  Agreement,  "Practice  Revenues"  shall mean gross
collections  of all  revenues  generated  by or on behalf of the New PC (whether
through subsidiaries or affiliates), including, but not limited to, all fees and
charges collected as a result of professional  endodontic  services furnished to
patients by the New PC and for any other  goods or services  sold or provided to
such patients.
<PAGE>
                                   EXHIBIT A

                       ENDODONTIC OFFICES - MASTER LEASE

                               [Dr. Gray Attach]

<PAGE>
                                   EXHIBIT B

                               PRACTICE PROVIDERS

                               [Dr. Gray Attach]
<PAGE>
                                   EXHIBIT C

                               New PC'S AFFIDAVIT

<PAGE>
                                   AFFIDAVIT

      I, Rodney A. Gray, D.D.S., declare:

      I am an  endodontist,  duly licensed in the State of Nevada and I practice
through a professional corporation under the name ______________ (the "New PC").

      I have had  substantial  experience in the practice of endodontics  and in
managing and operating an endodontic office.

      In the course of operating endodontic offices, I have acquired significant
knowledge as to the overhead  costs  incurred  and gross  receipts  generated by
similar  types  of  endodontic  offices.  Further,  I  am  fully  aware  of  the
non-endodontic,  operational,  accounting,  billing,  financing,  management and
personnel  requirements of an endodontic office and the cost factors involved in
providing  such  management,   personnel,  accounting,  billing,  financing  and
operation.

      I  have  thoroughly   reviewed  the  Management  Services  Agreement  (the
"Agreement"),  which is effective as of ________________,  1997, between the New
PC and Omega  Orthodontics  of Reno,  Inc.  (the "MSO")  concerning  the duties,
responsibilities and obligations undertaken by the MSO in managing and operating
all  non-endodontic  aspects of the  Endodontic  Office as  contemplated  by the
Agreement.

      I have reviewed the prior operating financial statements of the endodontic
office  located at 4101  Caughlin  Square - Suite 2, Reno,  Nevada  89509 and an
operating  budget and estimated  income of the endodontic  office,  which, in my
opinion, can reasonably be expected from the operation of said office.

      In  my  opinion,  based  upon  my  experience,   the  Management  Fees  of
Seventy-Five  Percent  (75%) of "Practice  Revenues" to be charged by the MSO as
contemplated  by the  Agreement,  will afford it a reasonable  but not excessive
return for its services  rendered and  obligations  incurred.  In addition,  the
Twenty-Five  Percent  (25%) of "Practice  Revenues"  retained by the New PC will
provide reasonable earnings for the performance of endodontic services.

      I declare under  penalty of perjury that the  foregoing  statement is true
and correct to the best of my knowledge and belief.

      Executed at _________________ this ____ day of _____________, 1997.


                                          _______________________________
                                          Rodney A. Gray, D.D.S.

                                 STATE OF NEVADA

___________________, ss.                        ________________, 1997


     Then  personally  appeared  the  above-named  Rodney A.  Gray,  D.D.S.  and
acknowledged the foregoing Affidavit to be his free act and deed.


[SEAL]                                          ____________________________
                                                Notary Public
                                                My Commission Expires:
<PAGE>
                                   EXHIBIT D

                               SECURITY AGREEMENT

<PAGE>
                               SECURITY AGREEMENT


      THIS  SECURITY  AGREEMENT  is  effective as of the ______ day of _________
1997, by  _____________________,  PC, a Nevada  corporation  (the "New PC"), and
Rodney A. Gray, D.D.S. ("Dr. Gray") who is duly licensed to practice endodontics
in the State and Omega  Orthodontics of Reno, Inc., a Delaware  corporation (the
"MSO") with reference to the following facts:

      WHEREAS,  pursuant to a Management  Services  Agreement (the "Agreement"),
dated as of the date hereof,  between the New PC and the MSO, as  assurance  and
collateral  security for the payment of the monthly  Management Fees owed to the
MSO pursuant to the Agreement and any funds  advanced by the MSO to or on behalf
of the  New PC  pursuant  to the  Agreement  and  for the  faithful  and  timely
performance  of all the covenants  and  conditions to be performed by the New PC
under  the  Agreement  (collectively,  the  "Obligations")  the New PC agreed to
pledge,  grant,  bargain,  assign and  transfer to the MSO a security  interest,
pursuant to the Uniform  Commercial  Code of the State,  in and to all  Practice
Revenue and the accounts receivable of patients of the New PC, together with all
proceeds thereof (collectively, the "Collateral");

      WHEREAS,  the New PC is obligated as a condition to the MSO's  performance
under the Agreement to execute and deliver this Security Agreement;

      NOW, THEREFORE, in consideration of the foregoing and of the covenants and
agreements hereinafter set forth, the parties hereto agree as follows:

      1. Grant of Security Interest.  As and for collateral security for payment
by the New PC of the  Obligations  and any and all  amounts  payable  under this
Security Agreement (collectively,  the "Secured Obligations"), the New PC hereby
pledges, grants,  bargains,  assigns and transfers to the MSO, and grants to the
MSO a security  interest in, the Collateral.  Dr. Gray shall cause the New PC to
perform fully and on a timely basis all of the New PC's  obligations  under this
Security  Agreement.  The MSO may at its option file a financing statement (Form
UCC-1) in order to perfect its security interest hereunder.

      2. Representations and Warranties.  The New PC represents and warrants all
of the accounts  receivable  constituting a portion of the Collateral of the New
PC pledged to the MSO are and will be validly created obligations of each of the
obligors who incurred same for services actually rendered in the ordinary course
of business of the New PC. Further,  the New PC represents and warrants that the
Collateral is not subject to any lien, pledge,  charge,  encumbrance or security
interest or right or option on the part of any third person.

      3. Release of Security Interest. Upon the termination of the Agreement and
payment in full of the accrued  Management Fees thereunder and any and all other
Secured Obligations,  the MSO shall release its security interest hereunder, and
will deliver to the New PC any property forming part of the Collateral delivered
to the MSO and then held by the MSO hereunder.

      4.  Realization  of  Collateral.  The MSO shall have,  with respect to the
Collateral,  the rights and  obligations  of a secured  party  under the Uniform
Commercial  Code as adopted in the state of Nevada  (the  "State").  Such rights
shall include, without limitation, the following:

            A. The right,  upon  default,  to have the  Collateral,  or any part
thereof, transferred to its own name or to the name of its nominee;

            B. The right,  upon default,  to sell,  assign or deliver as much of
the  Collateral as is reasonably  necessary to repay the defaulted  indebtedness
(together with expenses  attendant upon such sale and  repayment),  at public or
private  sale,  as the MSO may  elect,  either  for cash or on  credit,  without
assumption  of any  credit  risk and  without  demand or  advertisement  (unless
otherwise required by law).

            C. The New PC hereby irrevocably authorizes the MSO to sign and file
financing  statements naming the New PC as the debtor and the MSO as the secured
party, at any time with respect to any Collateral,  without the signature of the
New  PC.  The  New PC  hereby  irrevocably  appoints  the  MSO as the  New  PC's
attorney-in-fact,  with full  authority in the place and stead of the New PC and
in the name of the New PC,  from time to time in the MSO's  discretion,  to take
any action and to execute any  instrument  which the MSO may deem  necessary  or
advisable to accomplish the purposes hereof. The attorney-in-fact granted herein
is coupled with an interest and is  irrevocable.  Third parties and entities and
persons  not a party to this  Security  Agreement  are  entitled to rely on this
attorney-in-fact  and an affidavit of the MSO attesting thereto.  The acceptance
of this  appointment  by the MSO shall not  obligate  it to perform  any duty or
covenant  required  to be  performed  by the New PC  under or by  virtue  of the
Collateral. Notwithstanding the foregoing power of attorney, the New PC shall at
any  time  on the  request  of the  MSO,  sign  Financing  Statements,  security
agreements or other agreements with respect to any Collateral. Upon the New PC's
failure  to  sign  said  Financing  Statements,  security  agreements  or  other
agreements,  the MSO is  authorized  as the agent of the New PC to sign any such
instruments.  Upon the  request of the MSO,  the New PC agrees to pay all filing
fees and to  reimburse  the MSO on demand for all costs and expenses of any kind
(including,  without  limitation,  legal fees) incurred in any way in connection
with the Collateral.

      5.  Purchase  of  Collateral.  At any such  private or public  sale of the
Collateral  or  part  thereof,  the  MSO may  purchase  and pay for the  same by
cancellation of such portion of the Obligations, equal to the purchase price and
free of any  right  of  redemption  on the part of the New PC.  The MSO  agrees,
however,  that the New PC shall  have all  rights,  including  rights of notice,
provided by the  Uniform  Commercial  Code as adopted in the State.  In any case
where notice is required,  five days' notice shall be deemed reasonable  notice.
In the event of any sale  hereunder,  the MSO shall  apply the  proceeds  in the
order set forth  below in  Paragraph  6 hereof.  The MSO may have  resort to the
Collateral or any portion thereof with no requirements on the part of the MSO to
proceed first against any other person or property.

      6. Application of Collateral.  Proceeds from the sale of the Collateral or
any part thereof shall be applied by the MSO in the following order:

            A. To the payment of the costs and expenses of  collection  incurred
by the  MSO,  including,  without  limitation,  attorneys'  fees  and all  other
reasonable  expenses,  liabilities  and costs  incurred by the MSO in connection
therewith;

            B. To the  payment  of the whole  amount  then  owing and unpaid for
advances and/or Management Fees;

            C. To the  payment  in full of all other  Obligations  of the New PC
under the Agreement; and

            D. To the payment to the New PC of any surplus then  remaining  from
such proceeds.

      7. Extension of Agreement.  No Renewal or extension of the  Agreement,  no
release  or  surrender  of  any  Collateral  given  as  security  in  connection
therewith,  and no delay in  enforcement  thereof or in exercising  any right or
power with respect  thereto or hereunder shall affect the rights of the MSO with
respect to the Collateral or any part thereof.

      8. Notices.  Any notice to be given  pursuant to this  Agreement  shall be
deemed  effective  the same day when  such  notice  is given  personally,  or by
telegram,  or  electronic  transmission  to the  President  of the party to whom
notice is being given. Notice by mail shall be deemed effective three days after
deposit in the United States mail, and properly addressed with postage prepaid.

            Notices to the MSO shall be given at:

            Omega Orthodontics of Reno, Inc.
            c/o Omega Orthodontics, Inc.
            3621 Silver Spur Lane
            Acton, CA 93510
            Attn: Robert Schulhof

or other such  addresses  as may be delivered by the MSO to the New PC from time
to time in writing.

            Notices to the New PC shall be given at:

            4101 Caughlin  Square - Suite 2
            Reno,  Nevada 89509
            Attn:  Rodney A. Gray, D.D.S.

or other such  addresses  as may be delivered by the New PC to the MSO from time
to time in writing.

      9. Waiver.  The waiver by either party to this  Security  Agreement of any
one or more  defaults,  if any,  on the part of the  other  party,  shall not be
construed  to  operate  as a waiver of the other or future  defaults  under this
Agreement.  This  Security  Agreement  may be  amended or  modified  only by the
written consent of both parties.

      10. Additional Documents.  The New PC agrees that it will duly execute and
deliver to the MSO any additional documents which may be reasonably necessary to
give  effect  fully  to the  security  interest  granted  to the MSO  hereunder,
including, without limitation, a financing statement on Form UCC-1.

      11.  Benefit.  This Security  Agreement  shall inure to the benefit of and
shall be  binding  upon the  respective  heirs,  successors  and  assigns of the
parties hereto.

      12.  Applicable  Law. This Agreement shall be governed by and construed in
accordance with the laws of the State.

      13. Defined Terms. Capitalized terms used in this Security Agreement which
are not defined  herein but which are defined in the  Agreement,  shall have the
respective meanings ascribed therein.

      14. Counterparts.  This Security Agreement may be executed  simultaneously
in one or more counterparts, each of which shall be deemed an original.

            IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed, as of the day and year first hereinabove written.


NEW PC:                                         MSO:

                                                OMEGA ORTHODONTICS OF
                                                RENO, INC.


By:____________________________                 By:__________________________
Name:   Rodney A. Gray                             Name:  Robert J. Schulhof
Title:  President                                  Title: President


DR. GRAY


_______________________________
Rodney A. Gray, D.D.S.

<PAGE>
                                   EXHIBIT E

                   ALTERNATIVE DISPUTE RESOLUTION PROCEDURES


A. Method of Invoking ADR Procedures

      1. These  procedures  may be invoked  by any party to an  agreement  which
incorporates  these  procedures  by  giving  written  notice to the other of the
dispute  and   designating  a  person  with   decision-making   authority   (the
"representative") to act on behalf of the disputing party regarding the dispute.
The other party shall be required  to respond to the  disputing  party's  notice
within five (5) business days by designating in writing its own  representative.
A party may choose  more than one person to  represent  it. If a party  appoints
only one representative, one or more of its officers may nonetheless attend such
meetings.

      2. The parties,  each acting through its  representative,  shall meet at a
mutually  acceptable  time  and  place  within  five  business  days  after  the
non-disputing party designates its representative to the other. At that meeting,
the  parties  shall  attempt  in good faith to  negotiate  a  resolution  of the
dispute,  or  failing  that,  to agree on a method  for  resolving  the claim or
dispute.

      3. If,  within ten (10)  business  days after the first  meeting or within
such longer period of time as the parties may mutually  agree,  the parties have
not succeeded in negotiating a resolution of the claim or dispute or agreeing on
a dispute  resolution  mechanism,  they shall submit the dispute to mediation in
accordance with the procedures set forth herein.

      4. The parties  will  jointly  appoint a mutually  acceptable  mediator to
mediate the dispute. If the parties are unable to agree on a mutually acceptable
mediator within five (5) days after the conclusion of the negotiations described
in paragraph 3 above,  then the parties  shall select a neutral third party from
the Center for Public  Resources,  New York, New York ("CPR") Panels of Neutrals
or the American Arbitration  Association ("AAA"),  with the assistance of CPR or
AAA,  unless the  parties  agree  otherwise  in  finding a  mutually  acceptable
mediator.

      5. The New PC and the MSO shall each bear 50% of the fees and costs of the
mediator and any fees and costs of CPR or AAA.

      6. The parties  agree to  participate  in good faith in the  mediation and
negotiations  related thereto for a period of thirty (30) days from  appointment
of a mediator by any of the parties or the CPR or AAA.

B.    Mediation procedures

      1. The mediator shall be neutral and impartial.

      2. The mediator shall control the procedural aspects of the mediation. The
parties will cooperate fully with the mediator.

        (a) The mediator is free to meet and  communicate  separately  with each
party.

        (b) The  mediator  will  decide  when to hold  joint  meetings  with the
        parties  and  when  to  hold  separate  meetings.   There  shall  be  no
        stenographic  record of any meeting.  Formal rules of evidence  will not
        apply.

        (c) The  mediator  may  request  that  there be no direct  communication
        between the parties or between their  attorneys  without the concurrence
        of the mediator.

      3. Each party may be  represented  by more than one person,  e.g.,  one or
more of its  officers  and an  attorney.  Each party will have a  representative
fully authorized to negotiate a settlement of the dispute present.

      4. The process will be conducted expeditiously.

      5. The mediator will not transmit  information  received from any party to
another  party or any  third  person  unless  authorized  to do so by the  party
transmitting the information.

      6. The entire process is  confidential.  The parties and the mediator will
not disclose information  regarding the process,  including settlement terms, to
third persons,  unless the parties otherwise agree. The process shall be treated
as a compromise  negotiation  for purposes of the Federal  Rules of Evidence and
state rules of evidence.

      7. The parties will refrain from pursuing  administrative  and/or judicial
remedies during the mediation process, except as otherwise expressly provided in
the agreement which incorporates these procedures.

      8. Unless all parties and the mediator otherwise agree in writing,

        (a) The mediator will be disqualified as a witness, consultant or expert
        in any pending or future investigation, action or proceeding relating to
        the subject matter of the mediation (including any investigation, action
        or proceeding which involves persons not party to this mediation); and

        (b) The mediator and any documents  and  information  in the  mediator's
        possession will not be subpoenaed in any such  investigation,  action or
        proceeding,  and all parties will oppose any effort to have the mediator
        and documents subpoenaed.

      9. If the dispute goes into  arbitration,  the mediator shall not serve as
an arbitrator, unless the parties and the mediator otherwise agree in writing.

      10. The mediator,  if a lawyer, may freely express views to the parties on
the legal issues of the dispute.

      11. The mediator shall not be liable for any act or omission in connection
with the mediation.

      12. The mediator may withdraw at any time by written notice to the parties
(i) for overriding personal reasons,  (ii) if the mediator believes that a party
is not acting in good faith,  or (iii) if the  mediator  concludes  that further
mediation efforts would not be useful.

C.    Binding Arbitration

      If the parties do not resolve the  dispute  through  mediation  within the
period provided in Part A above,  the parties shall submit the matter to binding
arbitration  in Boston,  Massachusetts  before a qualified  sole  arbitrator  in
accordance with the then current CPR Rules for  Non-Administered  Arbitration of
Business  Disputes or comparable AAA rules.  The sole arbitrator shall be agreed
upon by the parties  within twenty (20) days after either party elects to submit
any issue to arbitration  or,  failing that,  shall be selected by CPR or AAA. A
qualified arbitrator is one who is familiar with the principal subject matter of
the  issues to be  arbitrated  such as by way of  example,  healthcare  services
industry  matters,   management   consulting   services  generally  or  business
law/corporate  matters  generally.  Judgment  upon  the  award  rendered  by the
arbitrator may be entered in any court having jurisdiction. The arbitrator shall
not have the  authority to award  multiple,  punitive or  consequential  damages
under any circumstances.