Exhibit 10.57b

 

 

Confidential material appearing in this document has been omitted and filed
separately with the Securities and Exchange Commission in accordance with Rule
24b-2, promulgated under the Securities and Exchange Act of 1934, as amended.
Omitted information has been replaced with asterisks.

 

SECOND AMENDMENT TO PURCHASED SERVICES AGREEMENT

 

This SECOND AMENDMENT TO PURCHASED SERVICES AGREEMENT (this “Second Amendment”)
is dated effective as of October 1, 2013 (the "Effective Date"), and is entered
into by and between GK FINANCING, LLC, a California limited liability company
(“GKF”), or its wholly owned subsidiary whose obligations hereunder shall be
guaranteed by GKF, and UNIVERSITY OF SOUTHERN CALIFORNIA, a California nonprofit
public benefit corporation (“Hospital”).

 

Recitals:

 

A. On March 5, 2008, GKF and USC University Hospital, Inc. entered into a
certain Purchased Services Agreement, which Purchased Services Agreement was (i)
transferred and assigned by USC University Hospital, Inc. to Hospital pursuant
to a certain letter dated effective as of March 31, 2009; and (ii) amended by a
certain First Amendment to Purchased Services Agreement dated effective as of
April 1, 2009 (the "First Amendment"), between GKF and Hospital (as so assigned
and amended, the "Agreement").

 

B. GKF and Hospital desire to further amend the Agreement as set forth herein.

 

NOW THEREFORE, for valuable consideration, the receipt and sufficiency of which
are acknowledged, the parties hereby amend the Agreement as follows:

 

Agreement:

 

1. Defined Terms. Unless otherwise defined herein, the capitalized terms used
herein shall have the same meanings set forth in the Agreement.

 

2. New Section 11.3. The following is hereby added as a new Section 11.3 to the
Agreement:

 

“11.3 GKF and Hospital shall mutually select an individual to be employed or
contracted by Hospital and who shall be located at the Site to provide Gamma
Knife administrative and marketing support services. The individual’s duties
shall include but not be limited to (i) working with and routinely obtain
feedback from physicians and medical groups; (ii) assisting in outreach and
business development efforts out in the community; and (iii) assisting in
marketing activities on an as needed basis. GKF shall reimburse Hospital for *
for the actual cost (which reimbursement by GKF to Hospital shall not exceed *
annually from the date of hire) of the individual and payment shall be made by
GKF to Hospital by the end of the following month. Any decision to reassign,
replace or terminate this individual shall be subject to prior mutual agreement
by GKF and Hospital. GKF's obligation to reimburse Hospital for the actual cost
of the individual as set forth above shall be limited to a period of one (1)
year following the date of the individual's hire, and any additional
reimbursement by GKF shall be subject to mutual agreement of the parties.”

 

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3. Amendment to Exhibit 8. Commencing as of the Effective Date, and continuing
through September 30, 2016, Exhibit 8 attached to this Second Amendment shall be
in effect instead of Exhibit 8 attached to the First Amendment; provided that,
commencing from and after October 1, 2016, Exhibit 8 attached to this Second
Amendment shall be of no further force and effect, and Exhibit 8 attached to the
First Amendment shall be reinstated and shall be in effect and control.

 

4. Cobalt Reload of the Equipment. Subject to GKF’s determination in its sole
and absolute discretion that a reload of the Equipment is financially
justifiable based upon the utilization of the Equipment and other factors
considered relevant by GKF and as enumerated in Section 18 of the Agreement
(Termination for Economic Justification), GKF, at GKF’s cost and expense, shall
reload the Equipment with new cobalt-60 that meets the manufacturer’s
radioactivity level specifications (the “Reload”), subject to the following
additional terms and conditions:

 

4.1 Scheduling and Process for the Reload. The Reload shall be performed at the
Site and shall include any required installation and rigging. Subject to
scheduling availability, GKF shall use its commercially reasonable efforts to
perform the Reload on or around first quarter 2015; provided that the Reload
shall be performed only after all necessary and appropriate licenses, permits,
approvals, consents and authorizations, including, without limitation, the
proper handling of the cobalt-60 (collectively, the “Permits”), have been
obtained by Hospital at Hospital’s sole cost and expense (other than any filing
or registration fees which shall be paid by GKF). GKF shall diligently and in
good faith cooperate with Hospital’s efforts to obtain the Permits. The timing
and procedure for such Reload shall be as mutually agreed upon between the
parties. Notwithstanding anything to the contrary contained in this Second
Amendment, GKF makes no representation or warranty to Hospital concerning the
Reload, and GKF shall have no obligation or liability to pay any damages to
Hospital resulting therefrom, including, without limitation, any lost revenues
or profits during the period of time that the Equipment is unavailable to
perform procedures due to the Reload process.

 

4.2 Hospital Personnel and Services. Upon request and as required by GKF,
Hospital, at Hospital’s cost and expense, shall provide GKF with Hospital
personnel (including Hospital’s physicists) and services in connection with the
Reload, among other things, to oversee, supervise and assist with construction
and compliance with local, state and federal regulatory requirements and with
nuclear regulatory compliance issues and the calibration of the Equipment.
Hospital shall not be entitled to reimbursement for its respective personnel
costs, internal costs or overhead.

 

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4.3 Extension of Lease Term. The Term of the Agreement is hereby extended to
July 8, 2020, plus the period of time that the Equipment is unavailable to
perform procedures due to the Reload, which Reload is estimated to take
approximately three (3) weeks).

 

4.4 No Additional Responsibilities. It is understood by the parties that GKF is
not responsible for any upgrades, hardware, cobalt reloading, software changes
and/or other modifications to the Equipment, except as expressly set forth
herein or otherwise agreed upon in writing by Hospital and GKF.

 

5. Full Force and Effect. Except as amended by this Second Amendment, all of the
terms and provisions of the Agreement shall remain in full force and effect.
Notwithstanding the foregoing, to the extent of any conflict or inconsistency
between the terms and provisions of this Second Amendment and that of the
Agreement, the terms and provisions of this Second Amendment shall prevail and
control.

 

IN WITNESS WHEREOF, the parties have executed this Second Amendment effective as
of the Effective Date.

 

GKF: Hospital: GK FINANCING, LLC

UNIVERSITY OF SOUTHERN CALIFORNIA 

                By: /s/ Ernest A. Bates, M.D. By: /s/ Thomas Jackiewicz   Ernest
A. Bates, M.D., Name: Thomas Jackiewicz   Policy Committee Member Title: Senior
VP and CEO, USC Health

 

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Exhibit 8

 

PER PROCEDURE PAYMENTS

 

[This Exhibit 8 is effective only from Effective Date through September 30,
2016.

Effective from and after October 1, 2016, this Exhibit 8 shall be of no further
force and effect, and Exhibit 8 attached to the First Amendment shall be
reinstated and shall be in effect and control.]

 

 

Annual Procedures Performed Fee Per Procedure * * * * * * * *

 

Notwithstanding anything to the contrary set forth herein, (a) for purposes of
determining the per Procedure payment, the number of annual Procedures performed
shall be reset to zero (0) at the commencement of each anniversary of the First
Procedure Date; and (b) there shall be no retroactive adjustment of the per
Procedure payment irrespective of whether (i) the number of Procedures performed
reaches a lower per Procedure payment level, or (ii) the Procedure was performed
during the same annual period but under a prior Fee Per Procedure schedule. For
example, if the aggregate number of Procedures during an annual period totals *,
then, the per Procedure payment for each of the first * Procedures would remain
at * per Procedure while the per Procedure payment for each of the next *
Procedures (i.e., for Procedures * through *) would remain at * per Procedure,
and the per Procedure payment for each of the next * Procedures (i.e., for
Procedures * through *) would be * per Procedure. There are no minimum volume
requirements.

 

“Charity Patients” shall be exempt from Hospital’s payment to GKF under the Fee
Per Procedure Schedule and shall not be included in the counting of annual
Procedures performed. As used herein, a "Charity Patient" shall mean a patient
who requires a Gamma Knife procedure and who meets all of the following
criteria: (1) such patient is not covered by Medicare, Medi-Cal or other
governmental or private insurance programs (whether indemnity, preferred
provider, health maintenance organization, etc.); (2) such patient does not have
the means to pay for such procedures based on Hospital’s adopted standards of
indigency; (3) the Hospital does not receive reimbursement for any Hospital
services rendered to such patient; and (4) such patient is either then enrolled
in N107C and/or is then receiving treatment at (i) Los Angeles County Hospital
(also known as Los Angeles County+USC Medical Center or County/USC) or (ii) Keck
Hospital of USC or USC Kenneth Norris Jr. Cancer Hospital; provided, however,
that there shall be a limit of * patients per year for Charity Patients
qualified under this subsection (ii).

 

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