Exhibit 10.40  Execution Copy  SECOND
LIEN COLLATERAL ASSIGNMENT OF PROMED ACQUISITION DOCUMENTS AND ALTA ACQUISITION DOCUMENTS  THIS SECOND
LIEN COLLATERAL ASSIGNMENT OF PROMED ACQUISITION DOCUMENTS AND ALTA ACQUISITION
DOCUMENTS (this Assignment) has been executed and delivered as of August 8,
2007, by and among ALTA HOSPITALS SYSTEM LLC, a California limited liability
company (ALTA LLC) (for itself and as successor-in-interest to Prospect
Hospitals System LLC (Prospect LLC) and Alta Healthcare System, Inc. (Alta
Inc.), PROSPECT MEDICAL HOLDINGS, INC., a Delaware corporation (Holdings),
and PROSPECT MEDICAL GROUP, INC., a California professional corporation (PMG
and collectively with Holdings and Alta LLC, Assignor), and BANK OF AMERICA,
N.A., as administrative agent (Administrative Agent), with reference to the
following facts:  RECITALS  A.            Holdings
and PMG are parties to certain documents pursuant to which, among other things,
PMG acquired the stock and assets of Pomona Valley Medical Group, Inc. (Pomona
Valley) and Upland Medical Group, a Professional Medical Corporation (Upland),
and Holdings acquired the stock and assets of ProMed Heahh Services Company (PHSC)
and ProMed Health Care Administrators (PHCA and together with Pomona Valley,
Upland and PHSC, each a ProMed Corporation and collectively, the ProMed
Corporations).  B.            Holdings,
Prospect LLC, Alta Inc. and Alta LLC are parties to certain documents pursuant
to which, among other things, Holdings acquired or will acquire (via the merger
of Alta Inc. with and into Prospect LLC, with the surviving entity being Alta
LLC) the stock and assets of Alta Healthcare System, Inc., Alta Hollywood
Hospitals, Inc. and Alta Los Angeles Hospitals, Inc. (each an Alta
Corporation and collectively, the Alta Corporations and together with the
ProMed Corporations, each an Acquired Corporation and collectively, the Acquired
Corporations) .  C.            Pursuant
to that certain Second Lien Credit Agreement, dated on or about the date hereof
(as the same may be amended, restated, supplemented or otherwise modified from
time to time, the Credit Agreement), Administrative Agent and the Lenders
have agreed to extend credit and other financial accommodations to Assignor
and/or certain of Assignors affiliates, and Assignor and the other Loan
Parties (including, without limitation, the Acquired Corporations) have agreed
to guarantee the payment and performance of all of the Obligations and to grant
to Administrative Agent security interests in the Collateral to secure payment
and performance of all of the Obligations.  D.            Assignor
has agreed to execute and deliver this Assignment to Administrative Agent in
order to supplement the terms of the Credit Agreement and the Collateral
Agreement with respect to the ProMed Acquisition Documents (as hereinafter
defined) and the Alta Acquisition Documents (as hereinafter defined).  E.            Assignor acknowledges that Administrative Agent and the
Lenders would not enter into the Credit Agreement absent Assignors agreements
hereunder.


AGREEMENT  In consideration of the premises and the
mutual agreements herein set forth, Assignor and Administrative Agent hereby
agree as follows:  1.            Defined Terms; lntercreditor Agreement.  1.1           Defined Terms.  All initially capitalized terms used but not
defined herein shall have the meanings assigned to such terms in the Credit
Agreement.  1.2           lntercreditor Agreement.  Notwithstanding anything contained herein to
the contrary, the liens and security interests granted to the Administrative
Agent, for the benefit of the Lenders, pursuant to this Assignment, and the
exercise of any right or remedy by the Administrative Agent, for the benefit of
the Lenders, under this Assignment, are subject to the provisions of the
Intercreditor Agreement.  In the event of
any conflict between the terms of the Intercreditor Agreement and this
Assignment, the terms of the Intercreditor Agreement shall govern and control.  2.            Assignment. 
As additional security for the Obligations, Assignor hereby collaterally
assigns and transfers to Administrative Agent, and acknowledges that, pursuant
to the Collateral Agreement, Assignor has granted to Administrative Agent a
security interest in:  2.1           ProMed Acquisition Documents.  All of Assignors right, title and interest
in and to the documents set forth on Exhibit A attached hereto
(collectively, the ProMed Acquisition Documents).  2.2           Alta Acquisition Documents.  All of Assignors right, title and interest
in and to the documents set forth of Exhibit B attached hereto
(collectively, the Alta Acquisition Documents and together with the ProMed
Acquisition Documents, the Acquisition Documents).  2.3           ProMed Rights and Remedies.  All of the rights, benefits, remedies,
privileges and claims of Assignor with respect to the ProMed Acquisition
Documents (collectively, the ProMed Rights And Remedies), including, without
limitation, (i) all rights to monies or payments owing to Assignor under the
ProMed Acquisition Documents, and any and all security therefor and for all
other obligations owing to Assignor thereunder, (ii) all rights that
Assignor may have to indemnification under the ProMed Acquisition Documents
including, without limitation, enforcement rights and collection rights, (iii) all
Rights and Remedies of Assignor with respect to any breach of the
representations, warranties and covenants set forth in any of the ProMed
Acquisition Documents, and (iv) the proceeds thereof.  2.4           Alta Rights and Remedies.  All of the rights, benefits, remedies,
privileges and claims of Assignor with respect to the Alta Acquisition
Documents (collectively, the Alta Rights And Remedies and together with the
ProMed Rights and Remedies, the Rights and Remedies), including, without
limitation, (i) all rights to monies or payments owing to Assignor under
the Alta Acquisition Documents, and any and all security therefor and for all
other obligations owing to Assignor thereunder, (ii) all rights that
Assignor may have to indemnification under the Alta Acquisition Documents, (iii) all
Rights and Remedies of Assignor


with respect to any breach of the representations,
warranties and covenants set forth in any of the Alta Acquisition Documents,
including, without limitation, enforcement rights and collection rights, and (iv) the
proceeds thereof.  3.             Rights and Remedies Generally.  Prior to the occurrence of an Event of
Default under the Credit Agreement or any other Loan Document (a Default),
Assignor will enforce all of its Rights and Remedies diligently and in good
faith.  Effective from and after the
occurrence of a Default, Assignor hereby irrevocably authorizes and empowers
Administrative Agent, in Administrative Agents sole discretion, to assert as
Administrative Agent may deem proper, either directly or on behalf of Assignor,
any and all of the Rights and Remedies which Assignor may from time to time
have under the Acquisition Documents, and to receive and collect all damages,
awards and other monies resulting therefrom and to apply the same on account of
any of the Obligations.  4.             Termination. 
This Assignment shall continue in effect until all of the Obligations
have been paid in full and the Credit Agreement has been terminated in
accordance with the terms thereof, at which time Administrative Agent shall
release to the Assignor Administrative Agents interests in the Acquisition
Documents and the Rights and Remedies and the other rights assigned to
Administrative Agent hereby.  5.             Further Assurances.  At any time or from time to time, upon
Administrative Agents written request, Assignor will execute and deliver to
Administrative Agent such further documents and do such other acts and things
as Administrative Agent may request in order to further effect the purposes of
this Assignment or any schedule, amendment or supplement hereto, or a financing
or continuation statement with respect hereto, in accordance with the laws of
any applicable jurisdictions.  Assignor
hereby authorizes Administrative Agent to effect any such filing or recording
statements (or amendments thereto) without the signature of Assignor, and
Administrative Agents costs and expenses with respect thereto shall be part of
the Obligations and shall be payable by Assignor on demand.  6.             Acquisition Documents.  Concurrent herewith, Assignor is delivering
to Administrative Agent possession of the original Acquisition Documents,
together with any and all amendments thereto, as in effect on the date hereof,
to hold in accordance with the terms of (a) the Credit Agreement until
such Credit Agreement is terminated in accordance with its terms and (b) the
lntercreditor Agreement.  7.             Attorney-in-Fact. 
Assignor hereby irrevocably makes, constitutes, and appoints
Administrative Agent (and Administrative Agents officers, employees, or
agents) as Assignors true and lawful agent and attorney-in-fact for the
purposes of enabling Administrative Agent or its agent(s) after the
occurrence of a Default to (a) assert and enforce such Rights and Remedies
and to collect such damages, awards and other monies and to apply them in the
manner set forth hereinabove, and (b) to sign the name of Assignor on any
documents which need to be executed, recorded, or filed, and to do any and all
things necessary in the name and on behalf of Assignor in order to protect
Administrative Agents interests in the Acquisition Documents.  Assignor agrees that neither Administrative
Agent, nor any of its designees or attorneys-in-fact, will be liable for any
act of commission or omission, or for any error of judgment or mistake of fact
or law with respect to the exercise of the power of attorney granted under this
Section 7, other than


as a result of its or their gross negligence or
willful misconduct.  The power of
attorney granted under this Section 7 is coupled with an interest and
shall be irrevocable until all of the Obligations have been paid in full, the
Credit Agreement and the other Loan Documents terminated, and Assignors duties
under this Assignment have been discharged in full.  Assignor will not assign, pledge or otherwise
encumber any of its rights, title or interest under, in or to any of the
Acquisition Documents except for the assignment to Administrative Agent and its
successors or assigns as set forth herein and the grant of a first priority
security interest to the First Lien Administrative Agent in and to the
Acquisition Documents.  8.             Modification of Rights and Remedies.  Assignor shall keep Administrative Agent
informed of all circumstances bearing adversely upon the Rights and Remedies.  Assignor shall not waive, amend, alter or
modify any of the Rights and Remedies in any adverse manner without the prior
written consent of Administrative Agent. 
Assignor shall not, without Administrative Agents prior written
consent, amend, alter, modify or terminate any of the Acquisition Documents, or
waive any of the provisions hereof, or do or permit any act in contravention
thereof.  9.             Assignor to Remain Liable.  Notwithstanding the foregoing, Assignor
expressly acknowledges and agrees that it shall remain liable under the
Acquisition Documents to observe and perform all of the conditions and
obligations in the Acquisition Documents which Assignor is bound to observe and
perform, and that neither this Assignment, nor any action taken pursuant
hereto, shall cause Administrative Agent to be under any obligation or
liability in any respect whatsoever to observe or perform any of the
representations, warranties, conditions, covenants, agreements or terms of the
Acquisition Documents.  10.           Counterparts; Effectiveness.  This Assignment may be executed in any number
of counterparts, each of which, when executed and delivered, shall be deemed to
be an original.  All of such
counterparts, taken together, shall constitute but one and the same agreement.  This Assignment shall become effective upon
the execution of a counterpart of this Assignment by each of the parties
hereto.  11.           Notices.  All notices, requests and other
communications to any party hereunder shall be sent in accordance with Section 10.02
of the Credit Agreement.  12.           Modifications and Amendments.  This Assignment shall not be changed orally
but shall be changed only by agreement in writing signed by Assignor and
Administrative Agent.  No course of
dealing between the parties, no usage of trade and no parole or extrinsic
evidence of any nature shall be used to supplement or modify any of the terms
or provisions of this Assignment.  13.           Severability.  If any provision of this Assignment is held
to be illegal, invalid or unenforceable under present or future laws, the
legality, validity and enforceability of the remaining provisions of this
Assignment shall not be affected thereby, and this Assignment shall be
liberally construed so as to carry out the intent of the parties to it.  14.           Governing Law; Venue; Successors
and Assigns; Entire Agreement.  This
Assignment (a) shall be construed in accordance with and governed by the
internal laws of the


State of New York; (b) shall be binding upon and
inure to the benefit of the parties hereto and their respective successors and
assigns; and (c) together with the Intercreditor Agreement, embodies the
entire agreement and understanding between the parties with respect to the
subject matter hereof and supersedes all prior agreements, consents and
understandings relating to such subject matter.  EACH ASSIGNOR UNCONDITIONALLY SUBMITS TO THE
NONEXCLUSIVE JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK SITTING IN THE
BOROUGH OF MANHATTAN AND OF THE UNITED STATES DISTRICT COURT OF THE SOUTHERN
DISTRICT OF NEW YORK.  15.           California Judicial Reference;
Jury Trial Waiver.  If,
notwithstanding the choice of law made in Section 14 of this Assignment,
any action or proceeding is filed in a court of the State of California by or
against any party hereto in connection with any of the transactions contemplated
by this Assignment, (a) the court shall, and is hereby directed to, make a
general reference pursuant to California Code of Civil Procedure Section 638
to a referee (who shall be a single active or retired judge) to hear and
determine all of the issues in such action or proceeding (whether of fact or of
law) and to report a statement of decision, provided that at the option of any
party to such proceeding, any such issues pertaining to a provisional remedy
as defined in California Code of Civil Procedure Section 1281.8 shall be
heard and determined by the court, and (b) Assignor shall be solely
responsible to pay all fees and expenses of any referee appointed in such
action or proceeding.  EACH PARTY HERETO
HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW,
ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY
OR INDlRECTLY ARISING OUT OF OR RELATING TO THIS ASSIGNMENT.  [Signature Pages Follow]


EXECUTED as of the date first above written.  ASSIGNOR:PROSPECT HOSPITALS SYSTEM, LLCBy:Name:Title:PROSPECT MEDICAL HOLDINGS, INC.By:Name: Jacob Y. Terner, M.D.Title: Chief Executive OfficerPROSPECT MEDICAL GROUP, INC.By:Name: Jacob Y. Terner, M.D.Title: Chief Executive OfficerADMINISTRATIVE AGENT:BANK OF AMERICA, N.A., 
  as administrative agentBy:Name:Title:


EXHIBIT A  PROMED ACQUISITION DOCUMENTS  On file with Kennedy Covington


EXHIBIT B  ALTA ACQUISITION DOCUMENTS  On file with Kennedy Covington