FIRST AMENDMENT
                                       TO
                               OPERATING AGREEMENT
                                       OF
                           HEART HOSPITAL OF DTO, LLC


         THIS FIRST AMENDMENT (the "Amendment") is entered into as of this ___
day of December, 1997 by and among HEART HOSPITAL OF DTO, LLC, a North Carolina
limited liability company (the "Company"), DTO MANAGEMENT, INC., a North
Carolina corporation ("DTO MANAGEMENT"), each of the Investor Members (as
defined in the Operating Agreement of the Company) and FRANCISCAN HEALTH SYSTEM
OF THE OHIO VALLEY, INC., an Ohio non-profit corporation ("FHS").

                                    RECITALS:

         1. On or about April 18, 1997, DTO Management and certain Investor
Members formed the Company in accordance with the original Operating Agreement
of Heart Hospital of DTO, LLC (the "Agreement");

         2. The Company was formed to own and operate an acute care hospital to
be located in the Dayton, Ohio area to specialize in cardiology and
cardiovascular care and surgery;

         3. It is intended that the Hospital will be a cost efficient, quality
provider of medical services within the Dayton, Ohio area in a manner which is
consistent with the national health care goals of lowering the cost of health
care;

         4. The capital contributions and active involvement of the Investor
Members are necessary to enable the Company to achieve its objectives;

         5. FHS is willing to become a member of the Company in order to provide
the Company with additional capital and to provide the Company with other
assistance which will enhance the Company's prospects of achieving its
objectives;

         6. The parties hereto desire to amend the Agreement in order to provide
for the admission of FHS as a member of the Company and to make certain
additional related changes to the Agreement.

         NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereto agree as
follows:


<PAGE>

         1.       The Agreement is hereby amended as follows:

                  (a)      Section 2.3(a) is amended as follows:

                                    (i) Sections 2.3(a)(ii) and (iii) are
                           amended by deleting the reference to "53,000" and
                           "40" and substituting "83,000" and "48" in lieu
                           thereof; it being acknowledged that the final size,
                           number and scope of facilities of the Hospital shall
                           finally be determined by the Managers;

                                    (ii) Section 2.3(a) is further amended by
                           removing the period at the end of (vii) thereof,
                           replacing it with "; and" and adding the following
                           new subsection (viii) thereafter:

                                                     (viii) Satellite diagnostic
                                            cardiac centers intended to be
                                            located in areas to the north and
                                            south of the Hospital.

                  (b) Section 2.3(b) is amended by adding the following at the
end thereof:

                           it being the plan of the Members that such real
                           property be acquired or leased pursuant to a
                           long-term ground lease from FHS, consisting of a to
                           be agreed upon parcel located on or adjacent to FHS's
                           existing hospital campus, and that the purchase price
                           or rent therefore shall be its fair market value as
                           established by an independent appraisal, which amount
                           and the other terms of which purchase or lease shall
                           finally be approved by DTO Management and the
                           Investor Managers and reflected in a written purchase
                           or lease agreement between FHS and the Company. Such
                           written agreement shall obligate the Company and FHS
                           to (i) cooperate with one another to develop a site
                           plan for the Hospital which will allow FHS to
                           continue to have access to all of its current
                           facilities (ii) to develop a mutually acceptable
                           signage plan and system in order to direct members of
                           the public to each of the facilities of FHS and the
                           Company and (iii) if a ground lease for the real
                           property is utilized, to provide lenders of funds for
                           the development and construction of the Hospital with
                           customary nondisturbance, attornment, estoppel and
                           other similar assurance agreements;

                  (c) The following additional purposes are hereby added as
subsection 2.3(d):

                           The Company and Hospital shall be operated in a
                           manner consistent with (i) the Ethical and Religious
                           Directives for Catholic


                                       2
<PAGE>



                           Health Care Services, as promulgated by the United
                           States Catholic Conference; (ii) the mission of the
                           Franciscan Health Partnership and its affiliates,
                           which include FHS; and (iii) the policies of FHS with
                           respect to providing indigent care to its patients.

                  (d) Section 3.1(a) is amended and restated to provide that DTO
         Management shall own at least a thirty-five percent (35%) Membership
         Interest in the Company and shall contribute to the Company for its
         Membership Interest One Million Four Hundred Seventy Thousand Dollars
         ($1,470,000.00);

                  (e) Section 3.1(b) is amended by deleting "49%" therefrom and
         substituting 35% in lieu thereof and by adding the following sentence
         to the end thereof:

                           It is acknowledged and agreed that after the date
                           hereof the Company may continue to seek qualified
                           individuals to become Investor Members who will
                           subscribe for any portion of the aggregate Membership
                           Interest described in this subsection (b) which has
                           not been subscribed for as of the date hereof, which
                           Investor Members shall be subject to the unanimous
                           approval of DTO Management and the Investor Manager
                           designated by the Investor Members as provided in
                           Section 5.1(x);

                  (f) The following is added as Section 3.1(c):

                           FHS shall own at least a thirty percent (30%)
                           Membership Interest in the Company and shall
                           contribute to the Company for its Membership Interest
                           One Million Two Hundred Sixty Thousand Dollars
                           ($1,260,000.00);

                  (g) The following is added as Section 3.7:

                           Guarantees of or Collateral for Indebtedness of the
                           Company. In the event that following written notice
                           from time to time by DTO Management to the Investor
                           Managers, DTO Management determines that DTO
                           Management or its Affiliates must provide, and they
                           have elected to so provide, guarantees or collateral
                           security to any lender or lessor who is providing
                           loans or lease financing to the Company only on the
                           condition that adequate guarantees or collateral
                           security be provided to such lender or lessors, then
                           FHS agrees to provide, on a several basis, guarantees
                           of any such loans or lease financing, or additional
                           collateral security for such loans or leases, on the
                           same terms and conditions as are then being provided
                           from time to time by DTO Management and its
                           Affiliates, it be acknowledged and agreed that 53.85%
                           of


                                       3
<PAGE>


                           any such guarantees or collateral security shall be
                           provided by DTO Management and its affiliates, and
                           46.15% thereof shall be provided by FHS. FHS agrees
                           to provide such financial statements as are required
                           from time to time by parties providing loans or lease
                           financing to the Company.

                  (h) The following is added as Section 3.8:

                           Additional Obligations of FHS.

                                    (a) From time to time subject to applicable
                           law and any applicable billing and reimbursement
                           rules and regulation, including, without limitation
                           all licensure requirements, FHS shall provide the
                           hospital, support and ancillary services to the
                           Hospital which are listed on Exhibit B attached
                           hereto, the pricing of which shall be reasonably
                           agreed upon by FHS and the Company and which
                           arrangement shall be evidenced by written agreements
                           to be entered into by FHS and the Company. Such
                           written agreement shall contain commercially
                           reasonable performance criteria which will allow the
                           Company to provide FHS written notice of any material
                           default, provide FHS with a reasonable cure period
                           and allow the Company thereafter to provide such
                           services itself in the event FHS has been unable to
                           cure such default;

                                    (b) The Company and FHS shall cooperate with
                           one another and work together on terms acceptable to
                           each such party to develop joint marketing and
                           managed care programs and strategies under which they
                           shall market their respective services to residents
                           of the Dayton area and to appropriate payors;

                                    (c) FHS shall lease to the Company and
                           Investor Members thereof, at fair market value, space
                           in FHS' medical office building subject to the
                           availability thereof;

                                    (d) Subject to satisfying FHS' credentialing
                           requirements, in order to enable the Hospital and
                           physicians practicing at the Hospital to provide
                           their services for their patients on an efficient and
                           a coordinated basis, upon the opening of the Hospital
                           physicians with privileges to practice at the
                           Hospital shall also be given privileges to read EKG,
                           ultrasound and cardiac nuclear camera studies and
                           tests (provided that FHS' obligation with respect to
                           cardiac nuclear camera studies shall be limited to
                           FHS using its commercially reasonable best efforts in
                           light of existing FHS obligations and commitments) at
                           Franciscan Medical Center.



                                       4
<PAGE>

                  (i) The following is added at the end of Section 5.1(g):

                           it being acknowledged and agreed that employees of
                           FHS who are affected by the closure of FHS' heart
                           program and who are acceptable to the Company shall
                           be offered employment by the Company to the extent
                           that the Company has positions available for such
                           employees. Such former employees of FHS shall be
                           given credit for their years of service with FHS for
                           purposes of the Company's employee benefit programs,
                           which benefit programs shall be established at
                           appropriate levels in light of local market
                           conditions.

                  (j) The following are added to Section 5.1:

                                    (bb) Develop and operate satellite cardiac
                           centers at locations to the north and south of the
                           Hospital as approved from time to time by the
                           Investor Managers. These centers will each provide
                           cardiac diagnostic and rehabilitative services. For
                           the north location, DTO Management anticipates
                           entering into an agreement, on behalf of the Company,
                           not later than July 1, 1998, with the Dayton Heart
                           Center, P.A. to sublease the second floor of the
                           medical office building in Dayton at which the Dayton
                           Heart Center, P.A. has its primary offices, and to
                           lease certain cardiac rehabilitation equipment from
                           the Dayton Heart Center, P.A. based upon such
                           equipment's depreciated book value, at which location
                           the Company would operate one of such satellite
                           centers. Such agreements to be entered into by DTO
                           Management on behalf of the Company with Dayton Heart
                           Center, P.A. shall provide for the right of the
                           Company to terminate such agreements in the event
                           that the services of the Company at such satellite
                           cardiac center are operating at a cash flow deficit
                           at the end of the three month period of operations
                           which commences with the opening of the Hospital.

                                    (cc) The Company shall lease parking spaces
                           to FHS in the parking facilities to be developed by
                           the Company based upon fair market value terms
                           therefore.

                                    (dd) It is acknowledged and agreed that FHS
                           shall be an eligible provider with respect to the
                           Company's welfare benefit plans.

                                    (ee) DTO Management is authorized to enter
                           into a land purchase or lease agreement and lease on
                           behalf of the Company


                                       5
<PAGE>


                           with FHS in accordance with the terms and conditions
                           of Sections 2.3(b) and 5.1(cc).

                                    (ff) Subject to the approval of the Investor
                           Manager elected by the Investor Members, DTO
                           Management, on behalf of the Company, may agree to
                           purchase from FHS any medical equipment required by
                           the Hospital which will no longer be needed by FHS
                           based upon such equipment's net book value, the
                           purchase price for which shall be paid in cash upon
                           the delivery of such equipment to the Hospital.

                  (k) The following shall be added at the end of Section 5.2:

                                    (k) Approve, repay, refinance or exercise
                           any material rights with respect to any loans, leases
                           or other financing provided by third parties to the
                           Company without the approval of DTO Management and
                           the Investor Manager, which shall not be unreasonably
                           withheld or delayed;

                                    (l) Waive or fail to enforce any material
                           provision of the Agreement without the consent of DTO
                           Management and the Investor Manager;

                                    (m) Enter into any agreement under which the
                           Company is obligated to make any payment of any type
                           or nature to any Investor Member or its affiliates
                           without the consent of DTO Management and the
                           Investor Manager;

                                    (n) Act in any manner which would cause the
                           Company and the Hospital to violate the purposes set
                           forth in Section 2.3(d) hereof.

                  (l)      Section 5.6(b) is amended:

                                    (i) Subsection 5.6(b)(ii) is hereby amended
                           by deleting therefrom the phrase "collected gross
                           revenues" and substituting in lieu thereof "net
                           revenues";

                                    (ii) Section 5.6(b)(ii) is amended by
                           deleting the word "the" in front of each reference in
                           such subsection to "Investor Manager" and adding the
                           word "each" in front of the words "Investor Manager"
                           on the first and eighth lines thereof and by deleting
                           the word "Investor" in front of the word "Members" on
                           the eighth line of such subsection.



                                       6
<PAGE>

                  (m) Section 5.9(b) is amended by adding ("Cardiac Services")
         after the word "services" in the eighth line of that subsection, and by
         inserting after the word "Hospital" on such eighth line the phrase
         "provided however in all events Hamilton County, Ohio is expressly
         excluded from such territory";

                  (n) Section 5.9(b) is further amended by adding the following
         paragraph at the end thereof:

                                    Notwithstanding anything herein to the
                           contrary, FHS may continue to operate Franciscan
                           Medical Center in the ordinary course prior to the
                           date upon which the Hospital is ready to receive its
                           first patient, following which date FHS and its
                           Affiliates shall be bound by the terms and conditions
                           of this Section 5.9 to the same extent as each other
                           member hereof, it being acknowledged and agreed that
                           as of such opening of the Hospital, the Cardiac
                           Services which are the subject of this restrictive
                           covenant shall be provided by FHS only through its
                           interest in the Company. The Company and FHS shall
                           enter into mutually acceptable agreements or
                           subcontracts under which the Hospital shall provide,
                           on behalf of FHS, all Cardiac Services which FHS is
                           obligated to provide or does provide under any
                           managed care agreement or arrangement to which FHS is
                           a party.

                                    In the event that during the term of this
                           Agreement and after the Hospital has been opened for
                           at least one (1) year, the Hospital ceases to hold
                           any license or certification which is necessary in
                           order for the Hospital to provide the material
                           Cardiac Services which it is then providing, and such
                           loss of licensure or certification is not cured
                           within the following one hundred twenty (120) day
                           period, then FHS may thereafter provide any and all
                           Cardiac Services at the Franciscan Medical Center
                           until the Hospital has regained such licensure and
                           certification and maintained it in good standing for
                           at least twelve (12) consecutive months at which time
                           FHS and its affiliates shall again be subject to the
                           restrictions set forth above in this Section 5.9(b).

                                    In the event that at any time hereafter
                           either DTO Management or its Affiliates on the one
                           hand, or FHS or its Affiliates on the other, desire
                           to develop, own, operate or manage a heart hospital
                           substantially similar to that contemplated by this
                           Agreement but to be located in Hamilton County, Ohio,
                           then each such parties shall give the other
                           reasonable first rights of refusal to participate in
                           such venture or transaction on substantially the same
                           terms and conditions as provided in this Agreement.



                                       7
<PAGE>

                                    The Company and its Hospital shall provide
                           its services and facilities primarily to patients
                           needing cardiology and cardiovascular care and
                           surgery and the Company shall not, directly or
                           indirectly, provide home health care services, own or
                           operate an endoscopy suite, or operate an emergency
                           room except as required by applicable law, including,
                           without limitation, any licensing requirements (and
                           subject to FHS fulfilling its obligations to the
                           Hospital with respect to emergency room services)
                           provided however, nothing shall prevent the Company
                           or the Hospital from providing any service or
                           facility which is required by a patient of the
                           Hospital whose needs relate primarily to cardiology
                           and cardiovascular care and surgery.

                                    Notwithstanding anything herein to the
                           contrary, FHS may continue to own and operate one (1)
                           cardiac catheterization laboratory which may be used
                           solely for diagnostic cardiac catheterization and
                           peripheral vascular studies.

                  (o) Section 5.9(e) is amended by deleting therefrom all
         references to "Investor";

                  (p) Section 5.13 is amended by adding "(a)" in front of the
         existing provision and deleting therefrom the word "the" in front of
         the first reference to Investor Manager in the last sentence of such
         provision and replacing it with "such";

                  (q) Section 5.13 is further amended by adding the following as
         Section 5.13(b):

                                    From time to time, FHS shall designate an
                           individual to serve as an Investor Manager to serve
                           for one (1) year terms or until a successor is duly
                           designated by FHS. At any time FHS may replace its
                           Investor Manager and designate a new Investor
                           Manager.

                  (r) Section 5.14 is amended by retitling such provision as
         "Role of and Decisions by Investor Manager" and adding "(a)" at the
         front of such provision;

                  (s) Section 5.14 is further amended by adding the following
         new subsection (b) thereto:

                           Except as provided in Section 5.13 and in the
                           definition of "Investor Manager" as provided in this
                           Agreement, all references in this Agreement to
                           "Investor Manager" shall mean the two (2) Investor
                           Managers elected and designated as set forth in
                           Section


                                       8
<PAGE>


                           5.13. Except as provided in Section 3.1(b) with
                           respect to the admission of new Investor Members
                           (which requires the unanimous approval of DTO
                           Management and the Investor Manager designated by the
                           Investor Members) all decisions to be made and
                           actions to be taken under the terms of this Agreement
                           by the "Investor Manager" shall be deemed to have
                           been approved or consented to by the "Investor
                           Manager" if following notice to the two (2) Investor
                           Managers elected or designated under Section 5.13 at
                           least one of such Investor Managers provides its
                           consent or approval of any such decision or action.

                  (t) Section 7.2(b) is deleted from the Agreement in its
         entirety and replaced with the following:

                           (b)      Intentionally omitted.

                  (u) Section 7.2(i) of the Agreement is deleted in its
         entirety;

                  (v) Section 8.1(b) is deleted from the Agreement and the
         following is substituted in lieu thereof:

                                    (b) The Investor Managers may not assign
                           their rights to be a Manager herein. Upon the
                           withdrawal or resignation of the Investor Manager
                           elected by the Investor Members, a substitute
                           therefore, who must be an Investor Member, may be
                           elected by a Majority Vote of Investor Members.

                  (w)      Section 8.4 is amended as follows:

                                    (i) The phrase "of FHS or" is added after
                           the words "Investor Member or" on the third line of
                           the first paragraph thereof;

                                    (ii) The phrase "or FHS" is added after the
                           words "Investor Member" on the ninth and twelfth
                           lines of the first paragraph of Section 8.4;

                                    (iii) The words "or of FHS" are added after
                           the words "Investor Member" on the fifth line of the
                           second paragraph of Section 8.4;

                                    (iv) The words "or FHS, as the case may be,"
                           are added after the word "Member" on the ninth line
                           of the second paragraph of Section 8.4 and in that
                           same paragraph the words "Investor

                                       9
<PAGE>


                           Members" are deleted therefrom and the word
                           "Member's" is substituted in lieu thereof.

                  (x) Section 10.1(a) is amended by adding the words "either by"
         after the words "DTO Management" in the second line thereof and by
         adding the words "or by FHS" after the words "Investor Manager" in the
         second line of such subsection;

                  (y) Section 11.1(g) is amended by adding the following
         sentence at the end of the second sentence of such section:

                           Two (2) of such Managers shall be elected by FHS.

                  (z) The fifth sentence of Section 11.2(g) is deleted in its
         entirety and the following is substituted in lieu thereof:

                           Notwithstanding the foregoing, in the event the
                           number of Managers is expanded, the Investor Members
                           and FHS shall continue to have the right to elect
                           Investor Managers who shall be designated to make
                           decisions which are specifically authorized to be
                           made by the Investor Manager under this Agreement and
                           DTO Management shall continue to have the right to
                           make decisions with respect to matters which are
                           reserved for DTO Management under this Agreement at
                           the time the number of Managers is so expanded.

                  (aa) Exhibit A is hereby amended to show FHS as a Member with
         an Initial Capital Contribution of One Million Two Sixty Thousand
         Dollars ($1,260,000.00) and a Maximum Mandatory Additional Capital
         Contribution of Two Million Five Hundred Twenty Thousand Dollars
         ($2,520,000.00);

                  (bb) The following definitions in the Glossary of Terms are
         hereby amended:

                                    (i) The definition of "Affiliate" is amended
                           by adding at the end thereof:

                                    "or (iv) with respect to a Person which is a
                                    non-profit corporation or association, any
                                    member of such non-profit corporation or any
                                    other non-profit corporation of which such
                                    Person is itself a member;

                                    (ii) The definition of "Investor Manager" is
                           deleted and the following is substituted in lieu
                           thereof:

                                    "Investor Manager" means the two
                                    individuals, one elected by Investor Members
                                    in accordance with Section 5.13(a)


                                       10
<PAGE>


                                    and a second to be designated by FHS in
                                    accordance with Section 5.13(b), who shall
                                    serve as Managers of the Company;

                                    (iii) The definition of "Prime Rate" is
                           amended by substituting "NationsBank" in lieu of
                           "First Union National Bank";

                                    (iv) The definition of "Super Majority Vote
                           of Members" is amended by replacing "67%" with "75%".

                  (cc) Each of the parties hereto acknowledges and agrees that
         they have been provided the revised capital expenditure budget and pro
         formas for the Company which are attached hereto as Exhibit X.

                  (dd) The second sentence of Section 5.16 is hereby deleted
         from the Agreement.

         2. Except as provided in this Amendment, the Agreement remains in full
force and effect.

         3. This Amendment may be signed in counterparts.

         4. FHS shall be entitled to make a due diligence visit to a heart
hospital developed by an affiliate of MedCath Incorporated on or prior to
December 24, 1997. FHS may rescind its agreement to the terms hereof in writing
on or before December 24, 1997 if it is not satisfied with the results of its
due diligence.

         5. DTO Management, Inc., on behalf of the Company, may rescind this
Amendment, and thereby terminate FHS as a member of the Company, if the Company
is unable to acquire or lease real property for the Hospital from FHS on terms
satisfactory to the Company.



                                       11
<PAGE>

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

                              DTO MANAGEMENT, INC.

                              By:   /s/ Charles W. Johnson
                                    ---------------------------

                              Title:    Vice President
                                    ---------------------------


                              FRANCISCAN HEALTH SYSTEM OF
                              THE OHIO VALLEY, INC.

                              By:     /s/ R. Christopher West
                                 ------------------------------------

                              Title:     President
                                    ---------------------------------


                              Cardiology Specialists of Dayton, Inc.

                              By:    /s/ Stephen P. Young, D.O.
                                 ------------------------------------

                              Title:     President
                                    ---------------------------------


                              /s/ Robert E. Bulow
                              ---------------------------------------
                                   Robert E. Bulow


                              /s/ Janis A. Roberts
                              ---------------------------------------
                                   Janis A. Roberts


                              /s/ Thomas M. Ruff
                              ---------------------------------------
                                   Thomas M. Ruff, D.O.


                              /s/ Stephen P. Young, D.O.
                              ---------------------------------------
                                   Stephen P. Young, D.O.


                                       12
<PAGE>

                              HZ & Associates Health Care Investments LLC

                              By:    /s/ Hans Zwart
                                 ------------------------------------

                              Title:     Investment Manager
                                    ---------------------------------


                              Hans Zwart M.D. & Associates, Inc.

                              By:    /s/ Hans Zwart
                                 ------------------------------------

                              Title:     President
                                    ---------------------------------


                              /s/ Scot W. Denmark, M.D.
                              ---------------------------------------
                                   Scot W. Denmark, M.D.


                              /s/ Jeffrey K. Hoffman
                              ---------------------------------------
                                   Jeffrey K. Hoffman


                              /s/ Thomas J. Merle, M.D.
                              ---------------------------------------
                                   Thomas J. Merle, M.D.



                              ---------------------------------------
                                   Surender R. Neravetla, M.D.


                              /s/ Bruce H. Rank, D.O.
                              ---------------------------------------
                                   Bruce H. Rank, D.O.


                              /s/ Cheryl Zwart
                              ---------------------------------------
                                   Cheryl Zwart


                              /s/ Hans Zwart
                              ---------------------------------------
                                   Hans Zwart, M.D.



                                       13
<PAGE>


                              AKMS Investments LLC

                              By:    /s/ Tajuddin Ahmed
                                 ------------------------------------

                              Title:     Manager
                                    ---------------------------------


                              Cardiologist of Clark & Champaign Counties Inc.

                              By:    /s/ Tajuddin Ahmed
                                 ------------------------------------

                              Title:     President
                                    ---------------------------------



                              /s/ Tajuddin Ahmed
                              ---------------------------------------
                                   Tajuddin Ahmed


                              /s/  Mohammed S. Khan
                              ---------------------------------------
                                   Mohammed S. Khan


                              /s/  Akber Mohammed
                              ---------------------------------------
                                   Akber Mohammed, M.D.


                              
                              ---------------------------------------
                                   Sagar S. Satyavolu


                              TDHC Investment, LLC

                              By:    /s/ Joel H. Tobiansky
                                 ------------------------------------

                              Title:     Authorized Signature
                                    ---------------------------------


                              Dayton Heart Center, Inc.

                              By:    /s/ C. David Joffe
                                 ------------------------------------

                              Title:     President
                                    ---------------------------------


                                       14
<PAGE>
                              /s/ Rohit Bhaskar
                              ---------------------------------------
                                   Rohit Bhaskar, M.D.

                              /s/ Henry H. Chong
                              ---------------------------------------
                                   Henry H. Chong, M.D.

                              /s/ Gary J. Fishbein
                              ---------------------------------------
                                   Gary J. Fishbein, M.D.

                              /s/ Amit Goyal
                              ---------------------------------------
                                   Amit Goyal, M.D.

                              /s/ C. David Joffe
                              ---------------------------------------
                                   C. David Joffe, M.D.

                              /s/ Kevin D. Kravitz
                              ---------------------------------------
                                   Kevin D. Kravitz, M.D.

                              /s/ Sudhakar Maraboyina
                              ---------------------------------------
                                   Sudhakar Maraboyina, M.D.

                              /s/ Timothy D. Markus, M.D.
                              ---------------------------------------
                                   Timothy D. Markus, M.D.

                              /s/ Enayatollah Tabesh
                              ---------------------------------------
                                   Enayatollah Tabesh, M.D.

                              /s/ Joel H. Tobiansky
                              ---------------------------------------
                                   Joel H. Tobiansky, M.D.

                              /s/ Charles S. Walker
                              ---------------------------------------
                                   Charles S. Walker



                                       15
<PAGE>

                              /s/ Raymond G. Pratt
                              ---------------------------------------
                                   Raymond G. Pratt, M.D.


                              Joseph A. Solomito, M.D. & Associates, Inc.

                              By:    
                                 ------------------------------------

                              Title:     
                                    ---------------------------------



                              Solomito Family Limited Partnership

                              By:    
                                 ------------------------------------

                              Title:     
                                    ---------------------------------


                              
                              ---------------------------------------
                                   Joseph A. Solomito, M.D.


                              /s/ Maria E. Babicki
                              ---------------------------------------
                                   Maria E. Babicki, M.D.


                              
                              ---------------------------------------
                                   Patrick J. Lytle, D.O.


                              /s/ Carla M. Kingsley, D.O.
                              ---------------------------------------
                                   Carla M. Kingsley, D.O.


                              /s/ John R. Ribic
                              ---------------------------------------
                                   John R. Ribic, D.O.



                                       16
<PAGE>


                              ---------------------------------------
                                   Wilhelm H. Kalweit, M.D.


                              /s/ J.E. Appleman
                              ---------------------------------------
                                   J.E. Appleman, M.D.


                                
                              ---------------------------------------
                                   E.M. Gullia, M.D.


                              /s/ Todd L. Sobol     
                              ---------------------------------------
                                   Todd L. Sobol



                              JTJJ, LLC

                              By:    
                                 ------------------------------------

                              Title:     
                                    ---------------------------------



                                       17
<PAGE>

                                                                       Exhibit B

                               Ancillary Services

          Dietary, meals on demand
          Lab and Blood Bank
          Pharmacy, Pharmacists only
          Maintenance & Engineering
          Central Supply
          Bio-med
          Security
          Housekeeping
          Hemodyalasis
          Respiratory Care
          Rehab
          Speech
          Occupational Therapy
          Ambulance
          Anesthesia
          Emergency Room
          Marketing
          Infection Control
          Social Service and Spiritual Care

It is acknowledged and agreed that the Company shall have the obligation to
attempt to enter into acceptable professional service agreements between the
Company and the anesthesiologists, pathologists and radiologists who currently
provide their services to FHS.