BONE, MUSCLE AND JOINT, INC.
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April 30, ▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇ Spinal Clinic, P.A.
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Tri-Party Agreement
Dear Sirs:
Reference is made to the Management Services Agreement dated as of December
23, 1996, between Bone, Muscle and Joint, Inc. (the "Company"), and South Texas
Spinal Clinic, P.A. (the "Medical Group"). Capitalized terms used but not
defined herein have the meanings ascribed thereto in the Management Services
Agreement.
In connection with the provision of Management Services under the
Management Services Agreement, the Company proposes to enter into a loan
agreement (the "Loan Agreement") with HCFP Funding, Inc. ("HCFP"). In order to
effectuate the financing provided under the Loan Agreement, HCFP has requested
that the Company and the Medical Group enter into an amendment (the "Amendment")
to the Management Services Agreement, substantially in the form attached hereto
as Annex I.
To induce the Medical Group to enter into the Amendment, the Company hereby
agrees to, and does by its signature hereon, instruct HCFP to deliver to the
Medical Group, for so long as the Management Services Agreement and the Loan
Agreement are in effect, the Semi-Monthly Draw, if any, payable by the Company
to the Medical Group under the Management Services Agreement. HCFP is hereby
instructed to deliver the Semi-Monthly Draw by wire transfer of funds to an
account designated by the Medical Group on the first day and the fifteenth day
of each month (or the business day immediately following, if such date occurs on
a day on which HCFP is not open for business). The Company and, by its signature
below, the Medical Group hereby acknowledge that HCFP's performance in
accordance with the foregoing instructions is subject to the terms and
conditions of the Loan Agreement with respect to the extension of credit to the
Company by HCFP.
In addition to the foregoing, HCFP agrees (by its countersignature hereto)
to deliver to the Medical Group a copy
South Texas Spinal Clinic, P.A.
April 30, 1997
Page 2
of any notice of default under the Loan Agreement (a "Default Notice") sent by
HCFP to the Company. HCFP's obligation set forth in the preceding sentence shall
in no event serve to modify the obligations of the Company or the rights of HCFP
under the Loan Agreement.
The parties hereto acknowledge that in the event the Medical Group receives
a Default Notice from HCFP or does not receive the Semi-Monthly Draw on the
applicable Draw Date, the Medical Group shall have the right (to be exercised in
its sole discretion) to terminate the Management Services Agreement by written
notice to the Company (with a copy to HCFP), which notice must be delivered no
later than 15 days prior to the Termination Date (as hereinafter defined). Such
termination shall be effective as of the date (the "Termination Date") that is
30 days after the last Draw Date on which the Medical Group received its Draw.
In the event of such termination, the Company's rights set forth in Section
3.19(a) of the Management Services Agreement with respect to any Accounts
generated after the Termination Date shall be revoked.
South Texas Spinal Clinic, P.A.
April 30, 1997
Page 2
If the foregoing meets with your approval, please sign this letter in the
space provided below and return a copy of this letter to me via facsimile and
the original via regular mail.
Very truly yours,
Bone, Muscle and Joint, Inc.
By:
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Executive Vice President and
Chief Financial Officer
Acknowledged and Agreed to
by each of the following:
HCFP Funding, Inc.
By:
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Name:
Title:
Address for Notices:
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Chevy Chase, Maryland 20815
South Texas Spinal Clinic, P.A.
By:
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President
Address for Notices:
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