Document:

Nobilis Health Corp.: Exhibit 10.37 - Filed by newsfilecorp.com

[Execution Version] 

REGISTRATION RIGHTS AGREEMENT 

THIS REGISTRATION RIGHTS AGREEMENT (this
“Agreement”) is made as of November 26, 2014, among Northstar
Healthcare Inc., a British Columbia registered corporation (the
“Company”), and the investors listed on the signature page hereto
(each, an “Investor” and collectively, the
“Investors”). 

RECITALS 

A. Company and the
Investors are parties to that certain Membership Interest Purchase Agreement of
even date herewith (the “MIPA”); and B. In order to
induce the Investors to enter into the MIPA, the Investors and Company hereby
agree that this Agreement shall govern the rights of the Investors to cause
Company to register shares of Common Stock issuable to the Investors. 

NOW, THEREFORE, the parties hereby agree as follows: 

1. Definitions. For purposes of this Agreement: 

1.1. “Common Stock”
means shares of Company’s registered common shares, no par value. 

1.2. “Company Sale”
means the occurrence of any of the following: (i) a sale of all or substantially
all of the assets of Company to any Person that is not an Affiliate of Company;
(ii) any sale in a single transaction or in a series of related transactions of
the voting securities of Company representing 50% or more of Company’s total
issued and outstanding voting securities (determined on a fully diluted basis)
to any Person that is not an Affiliate of Company; or (iii) any merger,
consolidation or reorganization of Company with or into one or more Persons that
are not Affiliates of Company, as a result of which less than 50% of the
outstanding voting securities of the surviving or resulting entity are, or are
to be, owned by the holders of Company’s voting securities immediately prior to
such merger, consolidation or reorganization.

1.3. “Damages”
means any loss, damage, claim or liability (joint or several) to which a party
hereto may become subject under the Securities Act, the Exchange Act, or other
federal or state law, insofar as such loss, damage, claim or liability (or any
action in respect thereof) arises out of or is based upon (i) any untrue
statement or alleged untrue statement of a material fact contained in any
registration statement of Company, including any preliminary prospectus or final
prospectus contained therein or any amendments or supplements thereto; (ii) an
omission or alleged omission to state therein a material fact required to be
stated therein, or necessary to make the statements therein not misleading; or
(iii) any violation or alleged violation by the indemnifying party (or
any of its agents or Affiliates) of the Securities Act, the Exchange Act,
any state securities law, or any rule or regulation promulgated under the
Securities Act, the Exchange Act, or any state securities law. 

1 

1.4. “Exchange Act”
means the Securities Exchange Act of 1934, as amended, and the rules and
regulations promulgated thereunder. 

1.5. “Excluded
Registration” means (i) a registration relating to the sale of
securities to employees of Company or a subsidiary of Company pursuant to a
stock option, stock purchase, or similar plan; (ii) a registration relating to
an SEC Rule 145 transaction; (iii) a registration on any form that does not
include substantially the same information as would be required to be included
in a registration statement covering the sale of the Registrable Securities; or
(iv) a registration in which the only Common Stock being registered is Common
Stock issuable upon conversion of debt securities that are also being
registered. 

1.6. "First Side
Letter" means that certain First Side Letter executed at Closing
by Harry J. Fleming and Donald L. Kramer.

1.7. “Form S-1”
means such form under the Securities Act as in effect on the date hereof or any
successor registration form under the Securities Act subsequently adopted by the
SEC. 

1.8. “Form S-3”
means such form under the Securities Act as in effect on the date hereof or any
registration form under the Securities Act subsequently adopted by the SEC that
permits incorporation of substantial information by reference to other documents
filed by Company with the SEC. 

1.9. “Holder” means
any holder of Registrable Securities who is a party to this Agreement. 

1.10. “Immediate Family
Member” means a child, stepchild, grandchild, parent, stepparent,
grandparent, spouse, sibling, mother-in-law, father-in-law, son-in-law,
daughter-in-law, brother-in-law, or sister-in-law, including
adoptive relationships, or a life partner of a natural person referred to
herein. 

1.11. “Initiating
Holders” means, collectively, Holders who properly initiate a
registration request under this Agreement. 

1.12. “Lock-Up
Period” means the period beginning on the Closing Date and ending on the
date all Purchase Price Stock cease to be subject to the restrictions set forth
in Section 3.1.

1.13. "NHC Note"
means that certain Promissory Note, dated as of the Closing Date, issued by
Company to the Seller Representative for the benefit of the Investors. 

1.14. “Purchase Price
Stock” means, with respect to each Investor, all shares of Common Stock
acquired by such Investor pursuant to the MIPA, including Contingent Shares but
excluding shares of Common Stock issued pursuant to the NHC Note.

1.15. “Registrable
Securities” means (i) any Common Stock and (ii) any Common Stock issued
as (or issuable upon the conversion or exercise of any warrant, right, or other
security that is issued as) a dividend or other distribution with respect to, or
in exchange for or in replacement of, the shares referenced in clause (i)
above; excluding in all cases, however, any Registrable Securities sold by a
Person in a transaction in which the applicable rights under this
Agreement are not assigned pursuant to Section 4.1, and excluding for
purposes of Section 2 any shares for which registration rights
have terminated pursuant to Section 2.12 of this Agreement. 

2 

1.16. “Registrable
Securities then outstanding” means the number of shares determined by
adding the number of shares of outstanding Common Stock that are Registrable
Securities and the number of shares of Common Stock issuable (directly or
indirectly) pursuant to then exercisable and/or convertible securities that are
Registrable Securities. 

1.17. “Restricted
Securities” means the securities of Company required to bear the legend
set forth in Section 2.12(b). 

1.18. “ROFR Price”
means, as of the close of trading on a given date of
determination, the price for sales of Common Stock on the applicable national
securities exchange or national inter-dealer quotation system on which such
securities are listed, in any case, as reported in such source as Company’s
Board of Directors shall select; provided, that if there is no regular public
trading market for shares of Common Stock, the ROFR Price shall be determined by
Company’s Board of Directors in good faith.

1.19. “SEC” means the Securities and Exchange
Commission. 

1.20. “SEC Rule
144” means Rule 144 promulgated by the SEC under the Securities Act.

1.21. “SEC Rule
145” means Rule 145 promulgated by the SEC under the Securities Act.

1.22. “Securities
Act” means the Securities Act of 1933, as amended, and the rules and
regulations promulgated thereunder. 

1.23. “Selling
Expenses” means all underwriting discounts, selling commissions, and
stock transfer taxes applicable to the sale of Registrable Securities, and fees
and disbursements of counsel for any Holder, except for the fees and
disbursements of the Selling Holder Counsel borne and paid by Company as
provided in Section 2.6 1.24. "Tag along Sale" is defined
in the First Side Letter 1.25. "Tag-along Seller" is defined in
the First Side Letter 1.26. "Tag Along Shares" is defined in the
First Side Letter Capitalized terms used but not defined in this Agreement have
the meanings given such terms in the MIPA. 

2. Registration Rights. Company covenants and agrees as
follows: 

3 

2.1. Demand Registration. 

(a) Form S-1 Demand. If at
any time after 180 days after the date of this Agreement Company receives a
request from Holders of at least 70% of the Registrable Securities then
outstanding that Company file a registration statement on Form S-1 or any such
other form available for registration of the Registrable Securities with
respect to at least 10% of the Registrable Securities then outstanding (or a
lesser percent if the anticipated aggregate offering price, net of Selling
Expenses, would exceed $10 million), then Company shall (i) within 10 days after
the date such request is given, give notice thereof (the “Demand
Notice”) to all Holders other than the Initiating Holders; and (ii) as
soon as practicable, and in any event within 75 days after the date such request
is given by the Initiating Holders (the “Form S-1 Filing
Deadline”), file a registration statement on Form S-1 or any such other
form available for registration of the Registrable Securities under the
Securities Act covering all Registrable Securities that the Initiating Holders
requested to be registered and any additional Registrable Securities
requested to be included in such registration by any other Holders, as specified
by notice given by each such Holder to Company within 20 days of the date the
Demand Notice is given, and in each case, subject to the limitations of
Section 2.1(c), Section 2.1(d) and Section 2.3. Company
shall use its commercially reasonable efforts to cause such registration
statement to become effective as promptly thereafter as practicable, but in any
event not later than 120 days after the Form S-1 Filing Deadline if Company
receives comments from the SEC (the “SEC Comments”) or 30 days
after the Form S-1 Filing Deadline if Company does not receive SEC Comments (the
“Form S-1 Effective Deadline”). 

(b) Form S-3 Demand. If at
any time when it is eligible to use a Form S-3 registration statement, Company
receives a request from any Holder or Holders of the Registrable Securities then
outstanding that Company file a Form S-3 registration statement with respect to
outstanding Registrable Securities of such Holder or Holders having an
anticipated aggregate offering price, net of Selling Expenses, of at least $2
million, then Company shall (i) within 10 days after the date such request is
given, give a Demand Notice to all Holders other than the Initiating Holders;
and (ii) as soon as practicable, and in any event within 45 days after the date
such request is given by the Initiating Holders (the “Form S-3 Filing
Deadline”), file a Form S-3 registration statement under the Securities
Act covering all Registrable Securities requested to be included in such
registration by any other Holders, as specified by notice given by each such
Holder to Company within 20 days of the date the Demand Notice is given, and in
each case, subject to the limitations of Section 2.1(c), Section
2.1(d) and Section 2.3. Company shall use its commercially reasonable
efforts to cause such registration statement to become effective as promptly
thereafter as practicable, but in any event not later than 90 days after the
Form S-3 Filing Deadline if Company receives SEC Comments or 30 days after the
Form S-3 Filing Deadline if Company does not receive SEC Comments (the
“Form S-3 Effective Deadline”). 

(c) Notwithstanding the foregoing
obligations, if Company furnishes to Holders requesting a registration pursuant
to this Section 2.1 a certificate signed by Company’s chief executive
officer stating that in the good faith judgment of Company’s Board of Directors
it would be materially detrimental to Company and its stockholders for such
registration statement to either become effective or remain effective for as
long as such registration statement otherwise would be required to remain
effective, because such action would (i) materially interfere with a significant acquisition,
corporate reorganization, or other similar transaction involving Company; (ii)
require premature disclosure of material information that Company has a bona
fide business purpose for preserving as confidential; or (iii) render Company
unable to comply with requirements under the Securities Act or Exchange Act,
then Company shall have the right to defer taking action with respect to such
filing, and any time periods with respect to filing or effectiveness thereof
shall be tolled correspondingly, for a period of not more than 90 days after the
request of the Initiating Holders is given; provided, however, that Company may
not invoke this right more than once in any 12-month period; and provided
further that Company shall not register any securities for its own account or
that of any other stockholder during such 90 day period other than an Excluded
Registration. 

4 

(d) Company shall not be
obligated to effect, or to take any action to effect, any registration pursuant
to Section 2.1(a) (i) during the period that is 60 days before Company’s
good faith estimate of the date of filing of, and ending on a date that is 180
days after the effective date of, a Company-initiated registration, provided,
that Company is actively employing in good faith commercially reasonable efforts
to cause such registration statement to become effective; (ii) after Company has
effected four registrations pursuant to Section 2.1(a); or (iii) if the
Registrable Securities may be registered on Form S-3. Company shall not be
obligated to effect, or to take any action to effect, any registration pursuant
to Section 2.1(b) (i) during the period that is 30 days before Company’s
good faith estimate of the date of filing of, and ending on a date that is 90
days after the effective date of, a Company-initiated registration, provided,
that Company is actively employing in good faith commercially reasonable efforts
to cause such registration statement to become effective; or (ii) if Company has
effected four registrations pursuant to Section 2.1(b) within the 12
month period immediately preceding the date of such request. A registration
shall not be counted as “effected” for purposes of this Section 2.1(d)
until such time as the applicable registration statement has been declared
effective by the SEC, unless the Initiating Holders withdraw their request for
such registration, elect not to pay the registration expenses therefor, and
forfeit their right to one demand registration statement pursuant to Section
2.6, in which case such withdrawn registration statement shall be counted as
“effected” for purposes of this Section 2.1(d). 

2.2. Company Registration.
If Company proposes to register (including, for this purpose, a registration
effected by Company for any stockholder other than the Holders) any Common Stock
under the Securities Act in connection with the public offering of such Common
Stock solely for cash (other than in an Excluded Registration), Company shall,
at such time, promptly give each Holder notice of such registration. Upon the
request of each Holder given within 20 days after such notice is given by
Company, Company shall, subject to the provisions of Section 2.3, cause
to be registered all of the Registrable Securities that each such Holder has
requested to be included in such registration. Company shall have the right to
terminate or withdraw any registration initiated by it under this Section 2.2
before the effective date of such registration, whether or not any Holder has
elected to include Registrable Securities in such registration. The expenses
(other than Selling Expenses) of such withdrawn registration shall be borne by
Company in accordance with Section 2.6. 

2.3. Underwriting Requirements.

5 

(a) If, pursuant to Section
2.1, the Initiating Holders intend to distribute the Registrable
Securities covered by their request by means of an underwriting, they shall so
advise Company as a part of their request made pursuant to Section 2.1,
and Company shall include such information in the Demand Notice. The
underwriters will be selected by the Initiating Holders, subject to Company’s
approval (which may not be unreasonably withheld). In such event, the right of
any Holder to include such Holder’s Registrable Securities in such registration
shall be conditioned upon such Holder’s participation in such underwriting and
the inclusion of such Holder’s Registrable Securities in the underwriting to the
extent provided herein. All Holders proposing to distribute their securities
through such underwriting shall (together with Company as provided in Section
2.4(e)) enter into an underwriting agreement in customary form with the
underwriter(s) selected for such underwriting. Notwithstanding any other
provision of this Section 2.3, if the underwriters advise the Initiating
Holders in writing that marketing factors require a limitation on the number of
shares to be underwritten, then the Initiating Holders shall so advise all
Holders of Registrable Securities that otherwise would be underwritten pursuant
hereto, and the number of Registrable Securities that may be included in the
underwriting shall be allocated among such Holders of Registrable Securities,
including the Initiating Holders, in proportion (as nearly as practicable) to
the number of Registrable Securities owned by each Holder or in such other
proportion as shall mutually be agreed to by all such selling Holders; provided,
however, that the number of Registrable Securities held by the Holders to be
included in such underwriting shall not be reduced unless all other securities
are first entirely excluded from the underwriting. To facilitate the allocation
of shares in accordance with the above provisions, Company or the underwriters
may round the number of shares allocated to any Holder to the nearest 100
shares. 

(b) In connection with any
offering involving an underwriting of shares of Company’s capital stock pursuant
to Section 2.2, Company shall not be required to include any of the
Holders’ Registrable Securities in such underwriting unless the Holders accept
the terms of the underwriting as agreed upon between Company and its
underwriters, and then only in such quantity as the underwriters in their sole
discretion determine will not jeopardize the success of the offering by Company.
If the total number of securities, including Registrable Securities, requested
by stockholders to be included in such offering exceeds the number of securities
to be sold (other than by Company) that the underwriters in their reasonable
discretion determine is compatible with the success of the offering, then
Company shall be required to include in the offering only that number of such
securities, including Registrable Securities, which the underwriters and Company
in their sole discretion determine will not jeopardize the success of the
offering. If the underwriters determine that less than all of the Registrable
Securities requested to be registered can be included in such offering, then the
Registrable Securities that are included in such offering shall be allocated
among the selling Holders in proportion (as nearly as practicable to) the number
of Registrable Securities owned by each selling Holder or in such other
proportions as shall mutually be agreed to by all such selling Holders. To
facilitate the allocation of shares in accordance with the above provisions,
Company or the underwriters may round the number of shares allocated to any
Holder to the nearest 100 shares. Notwithstanding the foregoing, in no event
shall (i) the number of Registrable Securities included in the offering be
reduced unless all other securities (other than securities to be sold by
Company) are first entirely excluded from the offering, or (ii) the number of
Registrable Securities included in the offering be reduced below 25% of the
total number of securities included in such offering For purposes of the provision in this
Section 2.3(b) concerning apportionment, for any selling Holder that is a
partnership, limited liability company, or corporation, the partners, members,
retired partners, retired members, stockholders, and Affiliates of such Holder,
or the estates and Immediate Family Members of any such partners, retired
partners, members, and retired members and any trusts for the benefit of any of
the foregoing Persons, shall be deemed to be a single “selling Holder,” and any
pro rata reduction with respect to such “selling Holder” shall be based upon the
aggregate number of Registrable Securities owned by all Persons included in such
“selling Holder,” as defined in this sentence. 

6 

(c) For purposes of Section
2.1, a registration statement will not be counted as “effected” if, as a
result of the underwriter’s cutback provisions in Section 2.3(a), fewer
than 50% of the total number of Registrable Securities that Holders have
requested to be included in such registration statement are actually included.

2.4. Obligations of
Company. Whenever required under this Section 2 to effect the
registration of any Registrable Securities, Company shall, as expeditiously as
reasonably possible: 

(a) prepare and file with the SEC a registration statement
  with respect to such Registrable Securities and use its commercially reasonable
  efforts to cause such registration statement to become effective and, upon the
  request of the Holders of a majority of the Registrable Securities registered
  thereunder, keep such registration statement effective for a period of up to 120
  days or, if earlier, until the distribution contemplated in the registration
  statement has been completed; provided, however, that (i) such 120 day period
  shall be extended for a period of time equal to the period the Holder refrains,
  at the request of an underwriter of Common Stock (or other securities) of
  Company, from selling any securities included in such registration, and (ii) in
  the case of any registration of Registrable Securities on Form S-3 that are
  intended to be offered on a continuous or delayed basis, subject to compliance
  with applicable SEC rules, such 120 day period shall be extended for up to 180
  days, if necessary, to keep the registration statement effective until all such
  Registrable Securities are sold; 

(b) prepare and file with the SEC such
  amendments and supplements to such registration statement, and the prospectus
  used in connection with such registration statement, as may be necessary to
  comply with the Securities Act with respect to the disposition of all securities
  covered by such registration statement for the period set forth in Section
  2.4(a); 

(c) furnish to the selling Holders such numbers of copies of a
  prospectus, including a preliminary prospectus, as required by the Securities
  Act, and such other documents as the Holders may reasonably request in order to
  facilitate their disposition of their Registrable Securities; 

(d) use its
  commercially reasonable efforts to register and qualify the securities covered
  by such registration statement under such other securities or blue-sky laws of
  such jurisdictions as shall be reasonably requested by the selling Holders;
  provided, that Company shall not be obligated to (i) qualify generally to do
  business in any jurisdiction where it is not then so qualified, or (ii) take any
  action that would subject it to general service of process or to taxation in any
  jurisdiction to which it is not then subject; 

7 

(e) in the event of any
underwritten public offering, enter into and perform its obligations under an
underwriting agreement, in usual and customary form, with the underwriter(s) of
such offering; 

(f) use its commercially reasonable efforts to cause all such
  Registrable Securities covered by such registration statement to be listed on a
  United States national securities exchange or trading system and each securities
  exchange and trading system (if any) on which similar securities issued by
  Company are then listed; 

(g) provide a transfer agent and registrar for all
  Registrable Securities registered pursuant to this Agreement and provide a CUSIP
  number for all such Registrable Securities, in each case not later than the
  effective date of such registration; 

(h) promptly make available for inspection
  by the selling Holders, any underwriters participating in any disposition
  pursuant to such registration statement, and any attorney or accountant or other
  agent retained by any such underwriter or selected by the selling Holders, all
  financial and other records, pertinent corporate documents, and properties of
  Company, and cause Company’s officers, directors, managers, employees, and
  independent accountants to supply all information reasonably requested by any
  such seller, underwriter, attorney, accountant, or agent, in each case, as
  necessary or advisable to verify the accuracy of the information in such
  registration statement and to conduct appropriate due diligence in connection
  therewith; 

(i) notify each selling Holder, promptly after Company receives
  notice thereof, of the time when such registration statement has been declared
  effective or a supplement to any prospectus forming a part of such registration
  statement has been filed; and 

(j) after such registration statement becomes
  effective, notify each selling Holder of any request by the SEC that Company
  amend or supplement such registration statement or prospectus.

2.5. Furnish Information.
It shall be a condition precedent to the obligations of Company to take any
action pursuant to this Section 2 with respect to the Registrable
Securities of any selling Holder that such Holder shall furnish to Company such
information regarding itself, the Registrable Securities held by it, and the
intended method of disposition of such securities as is reasonably required to
effect the registration of such Holder’s Registrable Securities. 

2.6. Expenses of
Registration. All expenses (other than Selling Expenses) incurred in
connection with registrations, filings, or qualifications pursuant to Section
2, including all registration, filing, and qualification fees; printers’ and
accounting fees; fees and disbursements of counsel for Company; and the
reasonable fees and disbursements of one counsel for the selling Holders
not to exceed $50,000 per registration (“Selling Holder
Counsel”), shall be borne and paid by Company; provided, however, that
Company shall not be required to pay for any expenses of any registration
proceeding begun pursuant to Section 2.1(a) if the registration request
is subsequently withdrawn at the request of the Holders of a majority of the
Registrable Securities to be registered (in which case all selling Holders shall
bear such expenses pro rata based upon the number of Registrable
Securities that were to be included in the withdrawn registration), unless the
Holders of a majority of the Registrable Securities agree to forfeit their right
to one registration pursuant to Section 2.1(a); provided further that if,
at the time of such withdrawal, the Holders shall have learned of a material
adverse change in the condition, business, or prospects of Company from that
known to the Holders at the time of their request and have withdrawn the request
with reasonable promptness after learning of such information, then the Holders
shall not be required to pay any of such expenses and shall not forfeit their
right to one registration pursuant to Section 2.1(a). All Selling
Expenses relating to Registrable Securities registered pursuant to this Section 2 shall be borne and paid by the Holders pro rata on the basis of
the number of Registrable Securities registered on their behalf.

8 

2.7. Obligations of
Holders. Each selling Holder pursuant to a registration effected pursuant to
this Agreement shall: 

(a) use its commercially reasonable efforts to provide all
  such information and material concerning such Holder as may reasonably be
  requested by Company in order to enable Company to comply with applicable
  requirements of the SEC; 

(b) not deliver any form of prospectus in connection
  with the sale of any Registrable Securities as to which Company has advised the
  selling Holders in writing that it is preparing an amendment or supplement; and  

(c) not have any right to obtain or seek an injunction restraining or otherwise
  delaying any such registration as the result of any controversy that might arise
  with respect to the interpretation or implementation of this Section
    2.

2.8. Indemnification. If
any Registrable Securities are included in a registration statement under this
Section 2: 

(a) To the extent permitted by law, Company will indemnify and
  hold harmless each selling Holder, and the partners, members, officers,
  directors, managers, and stockholders and Affiliates of each such Holder; legal
  counsel and accountants for each such Holder; any underwriter (as defined in the
  Securities Act) for each such Holder; and each Person, if any, who controls such
  Holder or underwriter within the meaning of the Securities Act or the Exchange
  Act, against any Damages, and Company will pay to each such Holder, underwriter,
  controlling Person, or other aforementioned Person any legal or other expenses
  reasonably incurred thereby in connection with investigating or defending any
  claim or proceeding from which Damages may result, as such expenses are
  incurred; provided, however, that the indemnity agreement contained in this Section 2.8(a) shall not apply to amounts paid in settlement of any such
  claim or proceeding if such settlement is effected without the consent of
  Company, which consent shall not be unreasonably withheld, nor shall Company be
  liable for any Damages to the extent that they arise out of or are based upon
  actions or omissions made in reliance upon and in conformity with written
  information furnished by or on behalf of any such Holder, underwriter,
  controlling Person, or other aforementioned Person expressly for use in
  connection with such registration. 

9 

(b) To the extent permitted by
law, each selling Holder, severally and not jointly, will indemnify and hold
harmless Company, and each of its directors, each of its officers who has signed
the registration statement, each Person (if any) who controls Company within the
meaning of the Securities Act, legal counsel and accountants for Company, any
underwriter (as defined in the Securities Act), any other Holder selling
securities in such registration statement, and any controlling Person of any
such underwriter or other Holder, against any Damages, in each case only to the
extent that such Damages arise out of or are based upon actions or omissions
made in reliance upon and in conformity with written information furnished by or
on behalf of such selling Holder expressly for use in connection with such
registration; and each such selling Holder will pay to Company and each other
aforementioned Person any legal or other expenses reasonably incurred thereby in
connection with investigating or defending any claim or proceeding from which
Damages may result, as such expenses are incurred; provided, however, that the
indemnity agreement contained in this Section 2.8(b) shall not apply to
amounts paid in settlement of any such claim or proceeding if such settlement is
effected without the consent of such selling Holder, which consent shall not be
unreasonably withheld; and provided further that in no event shall the aggregate
amounts payable by any Holder by way of indemnity or contribution under
Sections 2.8(b) and 2.8(c) exceed the proceeds from the offering
received by such selling Holder (net of any Selling Expenses paid by such
Holder), except in the case of fraud or willful misconduct by such selling
Holder. 

(c) Promptly after receipt by an
indemnified party under this Section 2.8 of notice of the
commencement of any action (including any governmental action) for which a party
may be entitled to indemnification hereunder, such indemnified party will, if a
claim in respect thereof is to be made against any indemnifying party under this
Section 2.8, give the indemnifying party notice of the commencement
thereof; provided, that such failure to give notice of any such action shall
relieve such indemnifying party of any liability to the indemnified party under
this Section 2.8 only to the extent that such failure materially
prejudices the indemnifying party’s ability to defend such action and shall not
relieve such indemnifying party of any liability it may have to the indemnified
party otherwise than under this Section 2.8. The indemnifying party shall
have the right to participate in such action and, to the extent the indemnifying
party so desires, participate jointly with any other indemnifying party to which
notice has been given, and to assume the defense thereof with counsel mutually
satisfactory to the parties; provided, however, that an indemnified party
(together with all other indemnified parties that may be represented without
conflict by one counsel) shall have the right to retain one separate counsel,
with the fees and expenses to be paid by the indemnifying party, if
representation of such indemnified party by the counsel retained by the
indemnifying party would be inappropriate due to actual or potential differing
interests between such indemnified party and any other party represented by such
counsel in such action.

10 

(d) To provide for just and
equitable contribution to joint liability under the Securities Act in any case
in which either (i) any party otherwise entitled to indemnification hereunder
makes a claim for indemnification pursuant to this Section 2.8, but it is
judicially determined (by the entry of a final judgment or decree by a court of
competent jurisdiction and the expiration of time to appeal or the denial of the
last right of appeal) that such indemnification may not be enforced in such
case, notwithstanding the fact that this Section 2.8 provides for
indemnification in such case, or (ii) contribution under the Securities Act may
be required on the part of any party hereto for which
indemnification is provided under this Section 2.8, then, and in
each such case, such parties will contribute to the aggregate losses, claims,
damages, liabilities, or expenses to which they may be subject (after
contribution from others) in such proportion as is appropriate to reflect the
relative fault of each of the indemnifying party and the indemnified party in
connection with the statements, omissions, or other actions that resulted in
such loss, claim, damage, liability, or expense, as well as to reflect any other
relevant equitable considerations. The relative fault of the indemnifying party
and of the indemnified party shall be determined by reference to, among other
things, whether the untrue or allegedly untrue statement of a material fact, or
the omission or alleged omission of a material fact, relates to information
supplied by the indemnifying party or by the indemnified party and the parties’
relative intent, knowledge, access to information, and opportunity to correct or
prevent such statement or omission; provided, however, that, in any such case,
(x) no Holder will be required to contribute any amount in excess of the public
offering price of all such Registrable Securities offered and sold by such
Holder pursuant to such registration statement, and (y) no Person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) will be entitled to contribution from any Person who was not
guilty of such fraudulent misrepresentation; and provided further that in no
event shall a Holder’s liability pursuant to this Section 2.8(c), when
combined with the amounts paid or payable by such Holder pursuant to Section
2.8(b), exceed the proceeds from the offering received by such Holder (net
of any Selling Expenses paid by such Holder), except in the case of
willful misconduct or fraud by such Holder. 

(e) Unless otherwise superseded
by an underwriting agreement entered into in connection with the underwritten
public offering, the obligations of Company and Holders under this Section
2.8 shall survive the completion of any offering of Registrable Securities
in a registration under this Section 2, and otherwise shall survive the
termination of this Agreement.

2.9. Reports Under Exchange
Act. With a view to making available to the Holders the benefits of SEC Rule
144 and any other rule or regulation of the SEC that may at any time permit a
Holder to sell securities of Company to the public without registration or
pursuant to a registration on Form S-1 or Form S-3, Company shall: 

(a) make and
  keep available adequate current public information, as those terms are
  understood and defined in SEC Rule 144, at all times after Company has become
  subject to the reporting requirements under the Securities Act or the Exchange
  Act; 

(b) use commercially reasonable efforts to file with the SEC in a timely
  manner all reports and other documents required of Company under the Securities
  Act and the Exchange Act (at any time after Company has become subject to such
  reporting requirements); and 

(c) furnish to any Holder, so long as the Holder
  owns any Registrable Securities, forthwith upon request (i) to the extent
  accurate, a written statement by Company that it has complied with the reporting
  requirements of SEC Rule 144, the Securities Act, and the Exchange Act (at any
  time after Company has become subject to such reporting requirements), or that
  it qualifies as a registrant whose securities may be resold pursuant to Form S-3
  (at any time after Company so qualifies); and (ii) such other
information as may be reasonably requested in availing any Holder of any rule or
regulation of the SEC that permits the selling of any such securities without
registration (at any time after Company has become subject to the reporting
requirements under the Exchange Act) or pursuant to Form S-3 (at any time after
Company so qualifies to use such form). 

11 

2.10. Limitations on
Subsequent Registration Rights. From and after the date of this Agreement,
Company shall not, without the prior written consent of the Holders of a
majority of the Registrable Securities then outstanding, enter into any
agreement with any holder or prospective holder of any securities of Company
that (i) would allow such holder or prospective holder (i) to include such
securities in any registration unless, under the terms of such agreement, such
holder or prospective holder may include such securities in any such
registration only to the extent that the inclusion of such securities will not
reduce the number of the Registrable Securities of the Holders that are included
or (ii) to initiate a demand for registration of any securities held by such
holder or prospective holder.

2.11. “Market Stand-off”
Agreement. Each Holder hereby agrees that it will not, without the prior
written consent of the managing underwriter, during the period commencing on the
date of the final prospectus relating to the registration by Company of shares
of its Common Stock or any other equity securities under the Securities Act on
a registration statement on Form S-1 or Form S-3 and ending on the date
specified by Company and the managing underwriter (such period not to exceed 90
days, or such other period as may be requested by Company or an underwriter to
accommodate regulatory restrictions on (1) the publication or other distribution
of research reports and (2) analyst recommendations and opinions, including the
restrictions contained in FINRA Rule 2711(f)(4) or NYSE Rule 472(f)(4), or any
successor provisions or amendments thereto), (i) lend; offer; pledge; sell;
contract to sell; sell any option or contract to purchase; purchase any option
or contract to sell; grant any option, right, or warrant to purchase; or
otherwise transfer or dispose of, directly or indirectly, any shares of Common
Stock or any securities convertible into or exercisable or exchangeable
(directly or indirectly) for Common Stock held immediately before
the effective date of the registration statement for such offering or
(ii) enter into any swap or other arrangement that transfers to another, in
whole or in part, any of the economic consequences of ownership of such
securities, whether any such transaction described in clause (i) or (ii) above
is to be settled by delivery of Common Stock or other securities, in cash, or
otherwise. The foregoing provisions of this Section 2.11 (i) shall
not apply to the sale of any shares to an underwriter pursuant to an
underwriting agreement, or the transfer of any shares to any trust for the
direct or indirect benefit of the Holder or the immediate family of the Holder,
provided that the trustee of the trust agrees to be bound in writing by the
restrictions set forth herein, and provided further that any such transfer shall
not involve a disposition for value, and (ii) shall be applicable to the Holders
only if all officers and directors are subject to the same restrictions and
Company uses commercially reasonable efforts to obtain a similar agreement from
all stockholders individually owning more than 5% of Company’s outstanding
Common Stock. The underwriters in connection with such registration are intended
third-party beneficiaries of this Section 2.11 and shall have the right,
power, and authority to enforce the provisions hereof as though they were a
party hereto. Each Holder further agrees to execute such agreements as may be
reasonably requested by the underwriters in connection with such registration
that are consistent with this Section 2.11 or that are necessary
to give further effect thereto. Any discretionary waiver or termination of the
restrictions of any or all of such agreements by Company or the underwriters
shall apply pro rata to all Holders subject to such agreements, based on the
number of shares subject to such agreements. Company may impose stop-transfer
instructions with respect to the shares of Common Stock (or other securities) to
enforce the foregoing restrictions. 

12 

2.12. Termination of
Registration Rights. The right of any Holder to request registration or
inclusion of Registrable Securities in any registration pursuant to Section
2.1 or Section 2.2 shall terminate at such time as SEC Rule 144 or
another similar exemption under the Securities Act is available for the sale in
the United States of all of such Holder’s shares without limitation during a
three month period without registration. 

3. Lock-Up Agreement. With
respect to each Investor, such Investor agrees as follows: 

3.1. Lock-Up.
  Notwithstanding anything to the contrary in this Agreement, subject to Section 3.1(a), Investor shall not offer to sell, contract to sell, or
  otherwise sell, dispose of, loan, pledge or grant any rights with respect to
  (collectively, a “Disposition”) any Purchase Price Stock, other
  than: (i) as a bona fide gift or gifts, provided that the donee or donees
  thereof agree in writing to be bound by the restrictions contained in this Section 3; (ii) with respect to sales or purchases of additional shares
  of Common Stock acquired on the open market after the Closing Date; (iii) with
  respect to sales or purchases of Common Stock between Investor and any other
  Person that is subject to a lock-up agreement containing terms and conditions
  essentially identical to those set forth in this Section 3; or (iv) with
  the prior written consent of Company, which may be granted or withheld in
  Company’s sole discretion. 

(a) Notwithstanding Section
3.1, (i) if Investor is a corporation, limited liability company,
partnership or trust, Investor may transfer any shares of Purchase Price Stock
to any Affiliate of Investor and (ii) if Investor is an individual, Investor may
transfer any shares of Purchase Price Stock by gift, will or intestacy to
Investor’s Immediate Family Members or to a trust or partnership, the
beneficiaries or partners of which are exclusively Investor or Investor’s
Immediate Family Members; provided, however, that in such case it shall be a
condition to such transfer that the transferee execute an agreement stating that
the transferee is receiving and holding such shares of Purchase Price Stock
subject to the provisions of this Section 3, and provided further that
such transfer not involve a disposition for value. 

(b) The restrictions set forth in
Section 3.1 do not, however, preclude Investor’s exercise of warrants or options
to purchase additional shares of Common Stock during the Lock-Up Period or the
Disposition of any shares of Common stock which are not Purchase Price Stock.

(c) Investor agrees and consents
to Company’s entry of stop transfer instructions with Company’s transfer agent
and registrar against the transfer of Purchase Price Stock except in compliance
with the restrictions. 

13 

(d) Investor agrees that the
certificate or certificates evidencing Investor’s shares of Purchase Price Stock
shall, for the duration of the Lock-Up Period, have the following legend: 

THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO A
CONTRACTUAL RESTRICTION ON TRANSFER AND MAY NOT BE SOLD, PLEDGED, HYPOTHECATED
OR OTHERWISE TRANSFERRED EXCEPT AS SET FORTH IN THAT CERTAIN LOCKUP AGREEMENT
BETWEEN THE COMPANY AND THE HOLDER HEREOF, A COPY OF WHICH IS ON FILE AT THE
PRINCIPAL OFFICE OF THE COMPANY. 

Notwithstanding the foregoing, the legend set forth above
shall, at the request of the holder, be removed from the certificate or
certificates evidencing the shares of Purchase Price Stock upon the expiration
of the Lock-Up Period. 

3.2. Time-Based Termination of
Lock-Up. The restrictions set forth in Section 3.1 shall be
effective as of the Closing Date and shall terminate automatically and without
further action by any Person in accordance with the following: 

(a) On January 1,
  2016, the restrictions set forth in Section 3.1 shall cease to apply to
  25% of Investor’s shares of Purchase Price Stock; 

(b) On April 1, 2016, the
  restrictions set forth in Section 3.1 shall cease to apply to and
  additional 25% of Investor’s shares of Purchase Price Stock; 

(c) On July 1,
  2016, the restrictions set forth in Section 3.1 shall cease to apply to
  an additional 25% of Investor’s shares of Purchase Price Stock; and 

(d) On
  October 1, 2016, the restrictions set forth in Section 3.1 shall cease to
  apply to the remaining 25% of Investor’s shares of Purchase Price Stock. 

3.3. Company Right of First
Refusal. If, at any time during the Lock-Up Period, an Investor proposes to
sell, shares of Purchase Price Stock that, pursuant to Section 3.2, are
no longer subject to the restrictions on Disposition set forth in Section
3.1 (“Unlocked Shares”), such Investor shall so inform Company
by written notice (the “ROFR Notice”) setting forth the number of
Unlocked Shares that are subject to such proposed sale (the “ROFR
Shares”). By delivering the ROFR Notice, the Investor shall be deemed to
have granted Company (or Company’s designee) an option for a period of ten
Business Days to purchase all but not less than all of the ROFR Shares at a
price per share equal to the ROFR Price applicable to the day immediately prior
to the day the Investors’ delivers the ROFR Notice to Company. If Company fails
to purchase the ROFR Shares within such ten-Business Day period, the Investor
may, for a period of 90 days, sell the ROFR Shares in such amounts and in such a
manner as the Investor deems fit, subject to applicable federal and state
securities Laws. Any ROFR Shares not sold within such 90-day period shall again
become subject to Company’s rights pursuant to this Section 3.3. 

14 

3.4. Termination of Lock-Up
and Right of First Refusal Upon the Occurrence of Certain Events.
Notwithstanding any other provision of this Section 3, both the
restrictions set forth in Section 3.1 and Company’s purchase rights
pursuant to Section 3.3 shall terminate and the Lock-Up Period shall end
automatically and without further action by any Person, upon the earlier of: 

(a)
  A Company Sale; 

(b) The termination of Christopher Lloyd’s employment with
  Company for any reason other than “Cause” (as such term is defined in that
  certain Employment Agreement, dated as of the Closing Date, by and among Company
  and Christopher Lloyd); 

(c) A secondary public offering of Company’s equity
  securities; or 

(d) A private placement (or any series of private placements,
  whether or not related) of Company’s equity securities, the aggregate purchase
  price of which exceeds five million United States dollars ($5,000,000.00);
  provided however, that the any amounts raised in a private placement or
  series of private placements that are used by the Company to pay any principal,
  interest or penalties on the NHC Note, shall not count towards the aggregate
  purchase price calculation of this Section 3.4(d); 

(e) A Tag-along Sale,
  provided that Company receives a copy of a Seller's Tag-along Notice not later
  than ten (10) days prior to the consummation of any Tag-along Sale, in which
  event the lock-up period shall automatically terminate for that number of Tag
  Along Shares which the Tag-along Seller is entitled to sell in the Tag-along
  Sale, as determined by the First Side Letter. The Lock-Up Period will first
  terminate on shares subject to release on the closest calendar day to the
  Tag-along Sale and then subsequently on the next closest dates until the final
  date for release is reached.

The Company hereby agrees to use best efforts to cause all
necessary parties to remove any restrictive legends on the shares subject to
release from the Lock-Up Period pursuant to this Section 3.4.

4. Miscellaneous.

4.1. Successors and
Assigns. The rights under this Agreement may be assigned (but only
with all related obligations) by a Holder to a transferee of Registrable
Securities that (i) is an Affiliate of a Holder; (ii) is a Holder’s Immediate
Family Member or trust for the benefit of an individual Holder or one or more of
such Holder’s Immediate Family Members; or (iii) after such transfer, holds at
least 10% of the Registrable Securities (subject to appropriate adjustment for
stock splits, stock dividends, combinations, and other recapitalizations);
provided, however, that (x) Company is, within a reasonable time after such
transfer, furnished with written notice of the name and address of such
transferee and the Registrable Securities with respect to which such rights are
being transferred; and (y) such transferee agrees in a written instrument
delivered to Company to be bound by and subject to the terms and conditions of
this Agreement. For the purposes of determining the number of shares of
Registrable Securities held by a transferee, the holdings of a transferee (1)
that is an Affiliate or stockholder, member or other owner of a Holder; (2) who is a
Holder’s Immediate Family Member; or (3) that is a trust for the benefit of an
individual Holder or such Holder’s Immediate Family Member shall be aggregated
together and with those of the transferring Holder; provided further that all
transferees who would not qualify individually for assignment of rights shall
have a single attorney-in-fact for the purpose of exercising any rights,
receiving notices, or taking any action under this Agreement. The terms and
conditions of this Agreement inure to the benefit of and are binding upon the
respective successors and permitted assignees of the parties. Nothing in this
Agreement, express or implied, is intended to confer upon any Person, other than
the parties hereto or their respective successors and permitted assignees, any
rights, remedies, obligations or liabilities under or by reason of this
Agreement, except as provided in Section 2.8 or as otherwise expressly
provided herein. 

15 

4.2. Governing Law. This
Agreement shall be governed by, and enforced under and construed in accordance
with, the laws of the State of Texas, regardless of the laws that might
otherwise govern under applicable principles of conflicts of law. 

4.3. Counterparts. This
Agreement may be executed in two or more counterparts, each of which shall be
deemed an original, but all of which together shall constitute one and the same
instrument. Counterparts may be delivered via facsimile, electronic mail
(including pdf) or other transmission method and any counterpart so delivered
shall be deemed to have been duly and validly delivered and be valid and
effective for all purposes. 

4.4. Titles and Subtitles.
The titles and subtitles used in this Agreement are for convenience only and are
not to be considered in construing or interpreting this Agreement. 

4.5. Notices. All notices
and other communications given or made pursuant to this Agreement shall be in
writing and given in accordance with Section 13.2 of the MIPA. 

4.6. Amendments and
Waivers. Any term of this Agreement may be amended and the observance of any
term of this Agreement may be waived (either generally or in a particular
instance, and either retroactively or prospectively) only with the written
consent of Company and the Investors holding at least a majority of the
Registrable Securities then outstanding; provided that Company may in its sole
discretion waive compliance with Section 3.1 (and Company’s
failure to object in writing within 30 days after written notification of a
proposed assignment allegedly in violation of Section 3.1 shall be deemed
to be a waiver); and provided further that any provision hereof may be waived by
any waiving party on such party’s own behalf, without the consent of any other
party. Notwithstanding the foregoing, this Agreement may not be amended or
terminated, and the observance of any term hereof may not be waived, with
respect to any Investor without the written consent of such Investor unless such
amendment, termination, or waiver applies to all Investors in the same fashion.
Company shall give prompt notice of any amendment or termination hereof or
waiver hereunder to any party hereto that did not consent in writing to such
amendment, termination, or waiver. Any amendment, termination, or waiver
effected in accordance with this Section 4.6 shall be binding on all
parties hereto, regardless of whether any such party has consented thereto. No
waivers of or exceptions to any term, condition, or provision of this Agreement,
in any one or more instances, shall be deemed to be or construed as a further or
continuing waiver of any such term, condition, or provision. 

16 

4.7. Severability. In case
any one or more of the provisions contained in this Agreement is for any reason
held to be invalid, illegal or unenforceable in any respect, such invalidity,
illegality, or unenforceability shall not affect any other provision of this
Agreement, and such invalid, illegal, or unenforceable provision shall be
reformed and construed so that it will be valid, legal, and enforceable to the
maximum extent permitted by law. 

4.8. Aggregation of
Securities. All shares of Registrable Securities held or acquired by
Affiliates shall be aggregated together for the purpose of determining the
availability of any rights under this Agreement and such Affiliated persons may
apportion such rights as among themselves in any manner they deem appropriate.

4.9. Entire Agreement; Certain
Terms. This Agreement (including any Schedules and Exhibits hereto)
constitutes the full and entire understanding and agreement among the parties
with respect to the subject matter hereof, and any other written or oral
agreement relating to the subject matter hereof existing between the parties is
expressly canceled. In this Agreement, (i) “$” refers to United States dollars,
(ii) “including” means “including, without limitation,” and (iii) “hereof,”
“herein,” and similar terms refer to this Agreement as a whole, and not to any
particular provision of this Agreement.

4.10. Dispute Resolution.
Any unresolved controversy or claim arising out of or relating to this
Agreement, shall be resolved in accordance with Section 13.12 of the MIPA.

4.11. Delays or Omissions.
No delay or omission to exercise any right, power, or remedy accruing to any
party under this Agreement, upon any breach or default of any other party under
this Agreement, shall impair any such right, power, or remedy of such
non-breaching or non-defaulting party, nor shall it be construed to be a waiver
of or acquiescence to any such breach or default, or to any similar breach or
default thereafter occurring, nor shall any waiver of any single breach or
default be deemed a waiver of any other breach or default theretofore or
thereafter occurring. All remedies, whether under this Agreement or by law or
otherwise afforded to any party, shall be cumulative and not alternative. 

[Remainder of page left intentionally blank; signature page
follows] 

17 

IN WITNESS WHEREOF, the parties
have executed this Agreement as of the date first written above. 

	COMPANY: 	 	By: 	 
	  	 	 	Name: 	 
	Northstar Healthcare Inc.
	 	Title: 	 
	  	 	 	  	 
	By: 	 	 	The Steven Ganss Irrevocable Asset
      Trust 
	Name: 	 	 	  	 
	Title: 	 	 	By: 	 
	  	 	 	Name: 	 
	INVESTORS: 	 	Title: 	 
	  	 	 	  	 
	  	 	 	The Amy Ganss Irrevocable Asset Trust
    
	Chris H. Lloyd 	 	  	 
	  	 	 	By: 	 
	  	 	 	Name: 	 
	Sam Bailey 	 	Title: 	 
	  	 	 	  	 
	  	 	 	  	 
	Vance Wells 	 	Alex Noffsinger 
	  	 	 	  	 
	The Wells Children’s Irrevocable
      Trust 	 	  	 
	  	 	 	Nick Lloyd 
	By: 	 	 	  	 
	Name: 	 	 	  	 
	Title: 	 	 	Tyler Holland 
	  	 	 	  	 
	The Vance Wells Irrevocable Asset
      Trust 	 	  	 
	  	 	 	Lewis Lefko 
	By: 	 	 	  	 
	Name: 	 	 	  	 
	Title: 	 	 	Brett Lamb 
	The Kim Wells Irrevocable Asset
      Trust 	 	  	 
	  	 	 	  	 
	By: 	 	 	David Grinbergs 
	Name: 	 	 	  	 
	Title: 	 	 	  	 
	  	 	 	Doug Johnson 
	  	 	 	  	 
	Steve Ganss 	 	  	 
	  	 	 	Chance McElhaney 
	The Ganss Irrevocable Trust 	 	  	 

[Signature Page to Registration Rights Agreement] 

	Cottonwood Family Trust 	 
	 	 
	By: 	 	 
	Name: 	 	 
	Title: 	 	 
	 	 
	 	 
	Melanie Gross 	 
	 	 
	 	 
	Christopher Smith 	 
	 	 
	 	 
	John Lookabaugh 	 
	 	 
	 	 
	Jonathan Herland 	 
	 	 
	 	 
	Greg Campbell 	 
	 	 
	 	 
	Brad Nelson 	 
	 	 
	 	 
	Keith Crider 	 
	 	 
	 	 
	Christopher Quinn 	 
	 	 
	 	 
	Erin Bouck 	 

[Signature Page to Registration Rights Agreement]Nobilis Health Corp.: Exhibit 10.38 - Filed by newsfilecorp.com

EXECUTION VERSION 

AMENDED AND RESTATED 
COMPANY AGREEMENT 

OF 

NHC ASC – Dallas, LLC 

(a Texas Limited Liability Company) 

	 
	
      THE MEMBERSHIP INTERESTS CREATED BY THIS AGREEMENT
      HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
      AMENDED, OR THE SECURITIES LAWS OF ANY JURISDICTION. NO MEMBERSHIP
      INTEREST MAY BE SOLD OR OFFERED FOR SALE (WITHIN THE MEANING OF
      ANY SECURITIES LAWS) UNLESS A REGISTRATION STATEMENT UNDER ALL
      APPLICABLE SECURITIES LAWS WITH RESPECT TO THE INTEREST IS THEN IN
      EFFECT OR AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF
      THOSE LAWS IS THEN APPLICABLE TO THE INTEREST. A MEMBERSHIP
      INTEREST ALSO MAY NOT BE TRANSFERRED OR ENCUMBERED UNLESS THE
      PROVISIONS OF THIS AGREEMENT ARE SATISFIED. 

	 

 

Dated as of April 1, 2014

AMENDED AND RESTATED 
COMPANY AGREEMENT 
OF

NHC ASC – Dallas, LLC 
(a Texas Limited Liability
Company) 

This Amended and Restated Company Agreement (this “Agreement”)
is made and entered into and shall be effective as of the 1st day of
April, 2014 (the “Effective Date”), by and among NHC ASC – DALLAS, LLC, a
Texas limited liability company (the “Company”), and each other Person
whose name is set forth on Exhibit A attached to this Agreement and has
signed this Agreement, as the Members. 

W I T N E S S E T H:

WHEREAS, the existing Members (as hereinafter defined) of the
Company, executed that certain Company Agreement effective as of August 27, 2013
(the “Original Company Agreement”); 

WHEREAS, as of the Effective Date, (i) Constellation Services
Group, LLC (“Constellation”) had not provided any services to the Company in
exchange for its equity interest in the Company as contemplated by Section
4.8(a) of the Original Company Agreement, and (ii) no Class A Member had
executed and/or delivered to the Company such Member’s Personal Guarantee (as
defined in the Original Company Agreement), nor had any Class A Member made any
capital contribution to the Company or rendered any services on behalf of the
Company in payment for such member’s equity interest in the Company;

WHEREAS, the Board of Managers authorized the Company to redeem
all of the issued and outstanding Class A Units and remove Constellation and all
of the Class A Members as Members of the Company effective as of December 31,
2013;

WHEREAS, the existing Members now desire to (i) add certain
Persons as Additional Members (as hereinafter defined) and (ii) make certain
material amendments to the Original Company Agreement; and

WHEREAS, in connection with amending the Original Company
Agreement to reflect the admission of such Additional Members to the Company and
to implement certain material changes to the Original Company Agreement, the
existing Members have decided that it would be appropriate to amend and restate
such Agreement in its entirety. 

NOW, THEREFORE, in consideration of the premises and the
agreements contained herein and for other valuable consideration, the receipt
and sufficiency of which is hereby acknowledged, the parties hereto do hereby
agree to amend and restate the Original Company Agreement in its entirety, as
follows: 

ARTICLE I. 

DEFINITIONS 

1.1 Certain Definitions. The terms specified in this
Section 1.1 shall, for all purposes of this Agreement, have the meanings herein
specified, unless the context expressly or by necessary implication otherwise
requires. 

“AAA” is defined in Section 19.4(b) . 

“Additional Member” means a Person who is
admitted into the Company as a Member pursuant to the terms of Section 14.4.

“Adjusted Capital Account Deficit” means the deficit
balance, if any, in a Member’s Capital Account as of the end of the relevant
fiscal year or other period, after giving consideration to the following
adjustments: 

(a) There shall be credited to such Capital Account any amounts
which the Member is obligated to restore to the Company or is deemed obligated
to restore pursuant to Treasury Regulations Section 1.704 -1(b)(2)(ii)(c) or
pursuant to the penultimate sentences of Treasury Regulations Sections 1.704
-2(g)(1) or 1.704 -2(i)(5); and 

(b) There shall be debited to such Capital Account the items
described in Treasury Regulations Sections 1.704 -1(b)(2)(ii)(d)(4), 1.704
-1(b)(2)(ii)(d)(5) and 1.704 -1(b)(2)(ii)(d)(6). 

“ADR” is defined in Section 19.1. 

“Administrator” is defined in Section 9.16(a) . 

“Adverse Terminating Event” means, with respect to any
Class A Member or Class C Member, any of the following: 

(a) The Member (which, for purposes of this definition,
includes any Physician who owns or controls a Class A Member or Class C Member
which is an entity), has breached the terms and conditions of this Agreement,
including without limitation, (i) violating the restrictions with respect to the
ownership of a financial interest in a Competing Business as set forth in
Section 11.5, or (ii) violating the Transfer restrictions set forth in Article
XIV and Article XV, each as determined in the sole discretion of the Board of
Managers and by a Required Interest of the Members; or 

(b) The Member (which, for purposes of this definition,
includes any Physician who owns or controls a Class A Member or Class C Member
which is an entity) has disrupted the affairs of the Company, has acted
adversely to the best interests of the Company, or has been deemed to be
unsuitable to remain a Member for any reason, or no reason, including, without
limitation, (i) the Member loses his or her license to practice medicine in the
State of Texas or has disciplinary proceedings initiated against such Member by
the regulatory agency having jurisdiction over such license and there is a
reasonable possibility that such Member could have his or her license suspended
or terminated as a result of such proceedings, (ii) the Member is convicted of
any felony or any criminal charge relating to the practice of medicine, (iii)
the Member commits any act or omits to take any act which poses an immediate,
significant and unreasonable threat to any patient, (iv) the Member violates any
material provisions of any applicable medical practice act or code of medical
ethics, as determined by the applicable licensing and/or regulating authority,
or (v) the Member is abusing any chemical substance that adversely affects such
Member’s ability to practice medicine, all as determined in the sole discretion
of the Board of Managers and a Required Interest of the Members. 

“Affiliate” means, with respect to any Member, (a) any
Person that directly or indirectly, through one or more intermediaries,
controls, is controlled by, or is under common control with a Member; (b) any
entity of which a Member owns ten percent (10%) or more of the outstanding
voting securities; (c) any Person who owns ten percent (10%) or more of the
outstanding voting securities of a Member; (d) any entity of which a Member is
an officer, director, general partner or trustee, or serves in a similar
capacity; (e) any Person who is an officer, director, general Member or trustee,
or serves in a similar capacity, of a Member; or (f) any child, grandchild
(whether through marriage, adoption or otherwise), sibling (whether through
adoption or otherwise), parent, or spouse of a Member. As used in this
definition of “Affiliate,” the term “control” means possession, directly or
indirectly, of the power to direct or cause the direction of the management and
policies of a Person whether through ownership of voting securities, by contract
or otherwise. 

“Agreement” means this Amended and Restated Company
Agreement, as it may be amended, modified, supplemented or restated from time to
time in accordance with the provisions of the Law and this Agreement. 

“Arbitration Submission Date” is defined in Section
19.4(a) . 

“ASC Procedures” means procedures that are on the
list of Medicare-covered procedures that can be performed in ambulatory surgery
centers under applicable Medicare regulations. 

“Authorized Individuals” is defined in Section 19.2.

“Available Cash” means all cash, demand deposits and
short term marketable securities received from the conduct of Company operations
or capital transactions (but not from Capital Contributions), less the portion
thereof used to pay, or establish reserves or cash set asides for, all Company
expenses, debt payments (including debt payments to the Member and other Persons
with regard to loans made pursuant to Section 4.2 of this Agreement), capital
improvements, replacements and contingencies, all as determined by the Board of
Managers in their sole discretion. “Available Cash” shall not be reduced by
depreciation, amortization, cost recovery deductions or similar allowances, but
shall be increased by any reductions of reserves previously established. 

“Bankruptcy” means, as to any Member, the Member’s
taking, or acquiescing to the taking, of any action seeking relief under, or
advantage of, any applicable debtor relief, liquidation, receivership,
conservatorship, bankruptcy, moratorium, rearrangement, insolvency,
reorganization or similar law affecting the rights or remedies of creditors
generally, as in effect from time to time. For the purpose of this definition,
the term “acquiescing” shall include, without limitation, the failure to file
within the time specified by law, an answer or opposition to any proceeding
commenced against such Member under any such law and a failure to file, within
thirty (30) days after its entry, a petition, answer or motion to vacate or to
discharge any order, judgment or decree providing for any relief under any such
law. 

“Board of Managers” means the governing body of the
Company, having all of the rights, duties and powers of the managers of a
limited liability company under the Law, subject to the terms of this Agreement.

“Capital Account” means that separate Capital Account
maintained by the Company for each Member and the amount of each such Member’s
Capital Account, as of any given date, which shall be computed as follows: 

(a) the Capital Account balance of each Member shall be
credited (increased) by (i) the amount of cash contributed by such Member to the
capital of the Company, (ii) the fair market value of property contributed by
such Member to the capital of the Company (net of liabilities secured by such
property that the Company assumes or takes subject to under Code Section 752),
and (iii) such Member’s allocable share of Company income and gain (or items
thereof) including income and gain exempt from federal taxation and income and
gain attributable to adjustments to reflect book value pursuant to Treasury
Regulations Section 1.704 -1(b)(2)(iv)(g), but excluding income and gain
attributable to tax items which differ as a result of the revaluation of Company
property as described in Treasury Regulations Section 1.704 -1(b)(4), and
Section 1.704 -1(b)(4)(i); and 

(b) the Capital Account balance of each Member shall be debited
(decreased) by (i) the amount of cash distributed to such Member, (ii) the fair
market value of property distributed to such Member (net of liabilities secured
by such property which the Member assumes or takes subject to under Code Section
752), (iii) such Member’s allocable share of expenditures of the Company
described in Code Section 705(a)(2)(B), and (iv) such Member’s allocable share
of Company losses, depreciation and other deductions (or items thereof)
including loss and deduction attributable to adjustments to reflect book value
pursuant to Treasury Regulations Section 1.704 -1(b)(2)(iv)(g) but excluding
expenditures described in (iii) above and loss or deduction attributable to tax
items which differ as a result of the revaluation of Company property or excess
percentage depletion as described in the Treasury Regulations.

The Board of Managers (acting in good faith and in accordance
with customary valuation methods) shall determine the fair market value of any
property contributed to the Company. 

In the event any Interest is transferred in accordance with the
terms of this Agreement, the transferee shall succeed to the Capital Account of
the transferor to the extent it relates to the transferred Interest. 

In determining the amount of any liability for purposes of
subparagraphs (a) and (b) above, there shall be taken into account Code section
752(c) and any other applicable provisions of the Code and Treasury Regulations.

Notwithstanding the foregoing, a Member’s Capital Account shall
not be adjusted to reflect gain or loss attributable to the disposition of
property contributed by such Member to the extent such Member’s Capital Account
reflected such inherent gain or loss in the property on the date of its
contribution to the Company. 

The foregoing provisions and the other provisions of this
Agreement relating to the maintenance of Capital Accounts are intended to comply
with Treasury Regulations sections 1.704 -1(b) and 1.704 -2, and shall be
interpreted and applied in a manner consistent with such Treasury Regulations.
In the event the Board of Managers determines that it is prudent to modify the
manner in which the Capital Accounts, or any debits or credits thereto, are
computed in order to comply with such Treasury Regulations, the Board of
Managers may make such modification; provided, that, it is not
likely to have a material effect on the amounts distributable to any Member upon
the termination or dissolution of the Company. The Board of Managers also shall
(a) make any adjustments that are necessary or appropriate to maintain equality
between the Capital Accounts of the Members and the amount of Company capital
reflected on the Company’s balance sheet, as computed for book purposes in
accordance with Treasury Regulations section 1.704 -1(b)(2)(iv)(g), and (b) make
any appropriate modifications in the event unanticipated events might otherwise cause this
Agreement not to comply with Treasury Regulations sections 1.704 -1(b) and 1.704
-2. 

“Capital Contribution” means, with respect to any
Member, the amount of cash and/or the initial Gross Asset Value of property
contributed to the capital of the Company, with respect to the Interest held by
such Member. In the event such term is used in this Agreement and such Capital
Contribution amount has not been adjusted in the applicable provision to reduce
the Capital Contribution amount by the liabilities which the Company assumes or
takes the property subject to with respect to property contributed by a Member,
such Member’s Capital Contribution will be reduced by such liabilities where
applicable for Federal income tax or state law purposes. 

“Class A Member” means a Person identified on
Exhibit A hereto as a Class A Member and who has signed this Agreement,
and such other Persons to whom the Company may issue Class A Membership
Interests, but excluding any Person who ceases to be a Class A Member pursuant
to this Agreement.

“Class A Membership Interest” means an Interest
owned by a Class A Member. 

“Class A Unit” means a unit of Class A Membership
Interest.

“Class B Member” means a Person identified on
Exhibit A hereto as a Class B Member, and such other Persons to whom the
Membership may issue Class B Membership Interests, but excluding any Person who
ceases to be a Class B Member pursuant to this Agreement.

“Class B Membership Interest” means an Interest
owned by a Class B Member. 

“Class B Unit” means a unit of Class B Membership
Interest. 

“Class C Member” means a Person identified on
Exhibit A hereto as a Class C Member, and such other Persons to whom the
Company may issue Class C Membership Interests, but excluding any Person who
ceases to be a Class C Member pursuant to this Agreement.

“Class C Membership Interest” means an Interest
owned by a Class C Member. 

“Class C Unit” means a unit of Class C Membership
Interest. 

“Code” means the Internal Revenue Code of 1986, as
amended from time to time. All references herein to sections of the Code shall
include any provision or corresponding provisions of succeeding law. 

“Company” means NHC ASC - Dallas, LLC, a Texas limited
liability company, and its successors and assigns. 

“Company Minimum Gain” shall have the meaning assigned
to “partnership minimum gain” in Treasury Regulations section 1.704 -2(b)(2) and
shall mean the amount determined under Treasury Regulations section 1.704
-2(d)(1) by (i) computing for each Nonrecourse Liability of the Company any gain
the Company would realize if it disposed of the property subject to that
liability for no consideration other than full satisfaction of the liability and
(ii) aggregating the separately computed gains. If, pursuant to Treasury
Regulations sections 1.704 -1(b)(2)(iv)(d) or 1.704 -1(b)(2)(iv)(f), Company
property is properly reflected on the books of the Company at a book value that
differs from the adjusted tax basis of such property, the calculation of Company
Minimum Gain pursuant to the preceding sentence shall be made by reference to
such book value. For purposes hereof, a liability of the Company is a
Nonrecourse Liability to the extent that no Member or related Person bears the
economic risk of loss for that liability within the meaning of Treasury
Regulations section 1.752 -2. 

“Competing Business” means any business that
offers or provides medical and/or surgical services which are the same as or
substantially similar to those medical and/or surgical services which are then
provided at the Surgery Center, including but not limited to surgical services
provided at a licensed ambulatory surgery center, a hospital, a hospital
out-patient department, and that is located within ten (10) miles of the Surgery
Center. 

“Confidential Information” is defined in Section
11.5(b) . 

“Contribution Time” is defined in Section 4.2(a) . 

“Curing Member” is defined in Section 4.2(b) . 

“Declining Member” is defined in Section 4.2(b) . 

“Depreciation” means, for each taxable year or other
period, an amount equal to the depreciation, amortization, or other cost
recovery deduction allowable with respect to an asset for such taxable year or
other period, except that if the Gross Asset Value of an asset differs from its
adjusted basis for Federal income tax purposes at the beginning of the year or
other period, Depreciation shall be an amount which bears the same ratio to such
beginning Gross Asset Value as the Federal income tax depreciation,
amortization, or other cost recovery deduction for such fiscal year or other
period bears to such beginning adjusted tax basis. If the Federal income tax
depreciation, amortization or other cost recovery deduction for the year or
other period is zero, Depreciation will be determined using any reasonable
method selected by the Board of Managers. 

“Discretionary Contribution” is defined in Section
4.2(a) . 

“Dispute” is defined in Section 19.1. 

“Disputing Person(s)” is defined in Section 19.2. 

“Due Date” is defined in Section 7.2. 

“EBITDA” means net income of the Company for a period,
plus interest expense, income tax expense, depreciation expense and amortization
expense for such period, each as calculated in accordance with generally
accepted accounting principles consistently applied. 

“Eligibility Affirmation Statement” means, except as
otherwise provided herein, the statement that each Physician Member must affirm
in writing, in connection with the initial acquisition of an Interest and,
thereafter, within thirty (30) days after the end of each calendar year or such
other 12-month period designated by the Board of Managers, and otherwise as may
reasonably be requested, representing that: 

(a) the Physician Member agrees to fully inform each patient
referred to the Surgery Center by the Physician Member of his or her investment
interest in the Company; 

(b) one-third (1/3) or more of the Physician Member’s medical
practice income for the prior twelve (12) month period was derived from the
performance of ASC Procedures, or in the case of facility-based physicians, that
one-third (1/3) or more of the Physician Member’s medical practice income for
the prior 12-month period was derived from the performance of professional
medical services in support of ASC Procedures (under such guidelines as the
Board of Managers may adopt or approve); 

(c) the Physician Member performed at least one-third (1/3) of
his or her ASC Procedures of the type that can be performed at the Surgery
Center during the prior 12-month period at the Surgery Center; or, in the case
of facility-based physicians, the Physician Member performed at least one-third
(1/3) of his or her professional medical services in support of ASC Procedures
at the Surgery Center; or, if a new Physician Member, he or she expects to
perform at least one-third (1/3) of such procedures at the Surgery Center each
year; 

(d) the Physician Member obtained in due course and has
thereafter continuously maintained membership on the medical staff at the
Surgery Center; 

(e) the Physician Member agrees to treat patients receiving
medical benefits or assistance under any governmental health care program
(including Medicare and Medicaid) in which such Physician Member participates in
a nondiscriminatory manner; and 

(f) the Physician Member has not been excluded, suspended or
debarred from participation in Medicare, Medicaid or any other federal or state
health care program, has not been convicted of a criminal offense under any
provision of the federal Social Security or had civil monetary penalties
assessed against him or her in relation to a violation of federal or state
Healthcare Laws or regulations, including those governing false claims and
kickbacks, and no action relating to such a violation is pending. 

The form of Eligibility Affirmation Statement may include or
address such other matters as may be approved by the Governing Board in relation
to compliance with this Agreement and/or applicable law. 

The Governing Board in its sole discretion may establish a
lower percent to be used for clauses (b) and (c) above for an individual
Physician Member based on a case-by-case analysis, consistent with federal and
state laws and regulations. If the Governing Board establishes a lower percent,
the Physician Member must consistently meet and annually certify compliance with
such modified requirements. 

“Exchange Act” shall mean the Securities Exchange Act of
1934, as amended (or any successor federal statute then in effect) and a
reference to a particular section thereof shall be deemed to include a reference
to the comparable section, if any, of any such successor federal statute. 

“Fair Market Value Price” means, at any time, the price
determined by multiplying the Net Worth by the appropriate Member’s Percentage
Interest. 

“Governmental Authority” means any and all Federal,
state or local governments, governmental institutions, public authorities and
any other governmental entities of any nature whatsoever, and any subdivisions
or instrumentalities thereof, including but not limited to departments, boards,
bureaus and panels, and any divisions or instrumentalities thereof, whether
permanent or ad hoc and whether now or hereafter constituted or existing. 

“Governing Board” is defined in Section 9.16(a) . 

“Gross Asset Value” means with respect to any asset, the
adjusted basis for Federal income tax purposes of such asset, except as follows:

(a) The initial Gross Asset Value of any asset contributed by a
Member to the Company shall be the gross fair market value of such asset on the
date of contribution, as determined by the Board of Managers; 

(b) The Gross Asset Values of all Company assets shall be
adjusted to equal their respective gross fair market values, as determined by
the Board of Managers, as of the following times: (i) the acquisition of an
additional Interest in the Company by any new or existing Member in exchange for more than a de minimis Capital Contribution; (ii)
the distribution by the Company to a Member of more than a de minimis amount of
Company property as consideration for an Interest in the Company, if the Board
of Managers reasonably determines that, with respect to adjustments pursuant to
subsections (i) and (ii) above, such adjustments are necessary or appropriate to
reflect the relative economic interests of the Members in the Company; (iii) the
liquidation of the Company within the meaning of Treasury Regulations section
1.704 -1(b)(2)(ii)(g); and (iv) the acquisition of an additional Interest in the
Company by any new or existing Member as consideration for the provision of
services to or for the benefit of the Company; 

(c) The Gross Asset Value of any Company asset distributed to
any Member shall be the gross fair market value of such asset on the date of
distribution; and 

(d) The Gross Asset Values of Company assets shall be increased
(or decreased) to reflect any adjustments to the adjusted basis of such assets
pursuant to Code sections 734(b) or 743(b), but only to the extent that such
adjustments are taken into account in determining Capital Accounts pursuant to
Treasury Regulations section 1.704 -1(b)(2)(iv)(m) and Section 6.2(f) hereof;
provided, however, that Gross Asset Values shall not be adjusted
pursuant to this subparagraph (d) to the extent the Board of Managers determines
that an adjustment pursuant to subparagraph (b) hereof is necessary or
appropriate in connection with a transaction that would otherwise result in an
adjustment pursuant to this subparagraph (d). 

“Healthcare Laws” means applicable provisions of the
Federal Social Security Act (including the Medicare and Medicaid Anti-Fraud and
Abuse Amendments (42 U.S.C. § 1320a-7a and -7b), the Federal Physician Anti-Self
Referral Law (42 U.S.C. § 1395nn)), the Patient Protection and Affordable Care
Act (Pub. L. No. 111-148, 124 Stat. 119 (2010)), the Texas Medical Practice Act
(Texas Occupations Code § 151.001 et seq.), the Texas Patient
Non-Solicitation Law (Texas Occupations Code § 102.001), and any regulations
promulgated thereunder, as these laws may now exist or hereafter may be amended.

“Indemnified Party” is defined in Section 13.1. 

“Initiating Person” is defined in Section 19.2. 

“Interest” means the interest of a Member in the
Company, including, without limitation, the rights of a Member in distributions
from the Company and allocations of the Profits, Losses, gains, deductions and
credits of the Company. 

“Investment Price” means the dollar amount paid in cash
by a Member for such Member’s Interest or the Gross Asset Value of any asset
contributed by a Member for such Member’s Interest. 

“Involuntary Transfer” is defined in Section 15.5. 

“Involuntary Transferee” is defined in Section 15.5.

“Law” means the Texas Limited Liability Company Law of
the Texas Business Organizations Code, as amended to date and as may be amended
from time to time hereafter and any successor to such Law. 

“Lending Member” is defined in Section 4.2. 

“Majority Interest” means such of the Members, as shall
own, at the time of any determination, more than fifty percent (50%) of all then
issued and outstanding Interests. 

“Manager” means each Person who has been elected as and
continues to be, a member of the Board of Managers, and the term “Manager” shall
for all purposes have the same connotation as the term “manager” under the Law.

“Marketing Committee” is defined in Section 9.18. 

“Medical Staff” is defined in Section 9.16(a) . 

“Member” means any Person who has been admitted
as a Member and whose name is set forth on Exhibit A hereto, and any
other Person admitted to the Company as a Member in accordance with this
Agreement, but excluding any Person who ceases to be a Member of the Company
pursuant to this Agreement.

“Member Loan Minimum Gain” means an amount, with respect
to each Member Loan Nonrecourse Debt, equal to the Company Minimum Gain that
would result if such Member Loan Nonrecourse Debt were treated as a Nonrecourse
Liability, determined in accordance with Treasury Regulations section 1.704
-2(i)(3). 

“Member Loan Nonrecourse Debt” shall have the meaning
assigned to “partner nonrecourse debt” in Treasury Regulations section 1.704
-2(b)(4). 

“Member Loan Nonrecourse Deductions” shall have the
meaning assigned to “partner nonrecourse deductions” in Treasury Regulations
section 1.704 -2(i)(2). The amount of Member Loan Nonrecourse Deductions with
respect to a Member Loan Nonrecourse Debt for a Company fiscal year or other
period equals the excess, if any, of the net increase, if any, in the amount of
Member Loan Minimum Gain attributable to such Member Loan Nonrecourse Debt during that fiscal year or other period over the aggregate
amount of any distributions during that fiscal year to the Member that bears the
economic risk of loss for such Member Loan Nonrecourse Debt to the extent such
distributions are from the proceeds of such Member Loan Nonrecourse Debt and are
allocable to an increase in Member Loan Minimum Gain attributable to such Member
Loan Nonrecourse Debt, determined in accordance with Treasury Regulations
section 1.704 -2(i)(2). 

“Net Worth” means, the greater of (a) three (3) times
the average EBITDA per tax year of the Company for the three (3) fiscal years
preceding the date of determination, or such lesser number of years if three (3)
fiscal years have not elapsed prior to the determination date, and (b) the
excess of the fair market value of all Company property over the amount of the
debts of the Company (whether or not any such debt is secured by a lien,
security interest or other encumbrance on the property). The Net Worth shall be
calculated on a cash basis by either the certified public accounting firm then
engaged by the Company or a certified public accountant designated by the Board
of Managers, within thirty (30) days after the Board of Managers has requested
such calculation. 

“Nonrecourse Deductions” shall have the meaning set
forth in Treasury Regulations section 1.704 -2(b)(1). The amount of Nonrecourse
Deductions for a Company fiscal year or other period equals the excess, if any,
of the net increase in the amount of Company Minimum Gain during the fiscal year
or other period, over the aggregate amount of any distributions during such year
or other period of proceeds of a Nonrecourse Liability that are allocable to an
increase in Company Minimum Gain, determined according to the provisions of
Treasury Regulations section 1.704 -2(c). 

“Nonrecourse Liability” shall have the meaning set forth
in Treasury Regulations section 1.704 -2(b)(3). 

“Percentage Interest” means, with respect to any Member,
the Interest of such Member expressed as a percentage of the Interests of all
the Members. 

“Person” means any individual, company, partnership,
corporation, limited liability company, trust or other entity. 

“Physician” means an individual who (a) holds one of the
following degrees: M.D., D.O., or D.P.M. or other degrees relating to health
care designated by the Board of Managers; (b) is currently duly licensed by and
in good standing with the State of Texas to practice such health care profession
for which the individual was trained; (c) has not been excluded or suspended
from participation in Medicare, Medicaid or any other Federal or state health
care program, has not been convicted of a criminal offense under any provision
of the Federal Social Security Act or had civil monetary penalties assessed
against him or her in relation to a violation of Federal or state health laws or
regulations, including those governing false claims and kickbacks, has not been
debarred from participation in any Federal procurement program, and no action
relating to such a violation is pending; (d) is in good standing and maintains
medical staff privileges at a Joint Commission accredited acute care hospital
which is located within twenty (20) miles of the Surgery Center; (e) is a
resident of the State of Texas and has no present intention of becoming a
resident of any other state or jurisdiction; (f) agrees to inform each patient
referred to the Surgery Center by such individual of his or her investment
interest in the Company; (g) expects to obtain in due course and thereafter
continuously maintain membership on the medical staff at the Surgery Center; and
(h) agrees to treat patients receiving medical benefits or assistance under any
governmental health care program in a nondiscriminatory manner. 

“Physician Class A Member” means any Person that is (i)
a Class A Member who is a Physician or (ii) an owner of a Class A Member who is
a Physician. 

“Physician Class C Member” means any Person that is (i)
a Class C Member who is a Physician or (ii) an owner of a Class C Member who is
a Physician. 

“Physician Member” means (i) a Physician Class A Member,
(ii) a Class B Member who is a Physician, (iii) a Class B Member that is an
entity wholly-owned by one or more Physicians, (iv) a Physician Class C Member,
(v) an Additional Member of any class, including any class or classes that may
be later created, who is a Physician, or (vi) an Additional Member of any class,
including any class or classes that may be later created, that is wholly owned
by one or more Physicians.

“Prime Rate” means the rate of interest per annum stated
from time to time in The Wall Street Journal (or any successor
publication thereto) as the base rate on corporate loans for at least
seventy-five percent (75%) of the thirty (30) largest banks in the United States

“Profits and Losses” “Profits” means, for each
fiscal year of the Company or other period, an amount equal to the Company’s
taxable income for such year or period, and “Losses” means, for each
fiscal year of the Company or other period, an amount equal to the Company’s
taxable loss for such year or period, in each case determined in accordance with
Code section 703(a) (for this purpose, all items of income, gain, loss, or
deduction required to be stated separately pursuant to Code section 703(a)(1)
shall be included in taxable income or loss), with the following adjustments:

(a) Any income of the Company that is exempt from Federal
income tax and not otherwise taken into account in computing Profits and Losses for purposes of this definition shall be added to such
taxable income or loss; 

(b) Any expenditures of the Company described in Code section
705(a)(2) (B) or treated as Code section 705(a)(2)(B) expenditures pursuant to
Treasury Regulations section 1.704 -1(b)(2)(iv)(i), and not otherwise taken into
account in computing Profits or Losses for purposes of this definition shall be
subtracted from such taxable income or loss; 

(c) In the event the Gross Asset Value of any Company asset is
adjusted pursuant to subparagraphs (b) or (d) of the definition of Gross Asset
Value, the amount of such adjustment shall be taken into account as gain or loss
from the disposition of such asset for purposes of computing Profits or Losses;

(d) Gain or loss resulting from any disposition of Company
property with respect to which gain or loss is recognized for Federal income tax
purposes shall be computed by reference to the Gross Asset Value of the property
disposed of, notwithstanding that the adjusted tax basis of such property
differs from its Gross Asset Value; 

(e) In lieu of depreciation, amortization and other cost
recovery deductions taken into account in computing such taxable income or loss,
there shall be taken into account Depreciation for such fiscal year or other
period, computed in accordance with the definition thereof; and 

(f) Notwithstanding any other provision of this definition, any
items of income, gain, loss or deduction that are specially allocated pursuant
to Sections 6.2 or 6.3 hereof shall not be taken into account in computing
Profits and Losses. 

“Proportionate Share” means a Member’s share of an item,
based upon the respective Percentage Interest of that Member as compared to the
Percentage Interests of all Members entitled to share in the item. 

“Repurchase Cap” is defined in Section 15.7 hereof. 

“Required Interest” means such of the Members as shall
own, at the time of any determination, at least seventy-five percent (75%) of
all Interests.

“Responding Person” is defined in Section 19.2. 

“Retirement” means that the gross cash receipts or
income derived (either directly or indirectly) by a Physician Class A Member
from rendering of medical services for the then-ending twelve (12) month period
is reduced from the gross cash receipts or income for the previous twelve (12)
month period by fifty percent (50%) or more (as reflected on the appropriate accounting and
tax records of such Physician Class A Member). Notwithstanding the foregoing,
for purposes of this Agreement, “Retirement” shall not occur as the direct or
indirect result of loss of license, criminal offense, disciplinary action or
other occurrences relating to improper or inappropriate acts or omissions of a
Member; “Retirement” is intended to relate only to bona fide retirement
from the practice of medicine in the ordinary course. 

“Securities Act” shall mean the Securities Act of 1933,
as amended (or any successor federal statute then in effect), and a reference to
a particular section thereof shall be deemed to include a reference to the
comparable section, if any, of any such successor federal statute. 

“Substitute Member” means any Person admitted to
the Company pursuant to Section 14.2. 

“Surgery Center” means that certain ambulatory
surgery center located at 5920 Forest Park Road, Suite 700, Dallas, Texas 75235
and any additional ambulatory surgery center which the Company may own, lease or
operate from time to time. 

“Tax Distributions” is defined in Section 7.2. 

“Terminating Event” means, with respect to any
Physician Class A Member or Physician Class C Member (which, for purposes of
this definition, includes any Physician who owns or controls a Class A Member or
Class C Member which is an entity), any of the following: 

(a) Such Member has died or become permanently disabled or
mentally incompetent; or 

(b) Such Member is in Bankruptcy; or 

(c) Such Member is in Retirement; or 

(d) Such Member fails to obtain medical staff privileges at the
Surgery Center within a reasonable time following either (i) the date that the
Company begins accepting applications for privileges to provide medical services
at the Surgery Center, or (ii) the date that his or her application to obtain
privileges to provide medical services at the Surgery Center has been submitted
to the Board of Managers; or 

(e) Such Member permanently relocates his or her principal
residence anywhere outside a fifty (50) mile radius of the Surgery Center; or

(f) If such Member is an entity, such Member dissolves,
liquidates or commences dissolution proceedings or has its charter revoked by
any applicable state authority; or

(g) Such Member at any time fails to satisfy all of the
requirements necessary to be a Physician as defined herein. 

“Transfer” means to sell, assign, transfer, pledge,
hypothecate or otherwise dispose of. 

“Treasury Regulations” or “Regulations” means the
regulations, promulgated by the United States Department of the Treasury
pursuant to and in respect of provisions of the Code. All references herein to
sections of the Treasury Regulations or the Regulations shall include any
corresponding provision or provisions of succeeding, similar or substitute
proposed, temporary or final regulations. 

“Tribunal” is defined in Section 19.4(b) . 

“Unit” means an Interest acquired and/or held as a
Member, designated as a Class A Unit, a Class B Unit or a Class C Unit. 

“Units” means the Class A Units, the Class B Units and
the Class C Units, collectively. The total authorized number of Units is one
hundred (100), consisting of (i) thirty-five (35) Class A Units, (ii)
thirty-five (35) Class B Units and (iii) thirty (30) Class C
Units. The number and type of Units owned by each Member shall be set forth on
Exhibit A attached hereto, as such Exhibit may be amended from time to
time. 

1.2 Other Definitions. In addition to the terms defined
in Section 1.1, certain other terms are defined elsewhere in this Agreement, and
whenever such terms are used in this Agreement, they shall have their respective
defined meanings, unless the context expressly or by necessary implication
otherwise requires. 

ARTICLE II. 

FORMATION AND CONTINUATION OF THE COMPANY 

2.1 Formation and Continuation. A Certificate of
Formation of the Company was filed in the office of the Secretary of State of
Texas on July 12, 2013, as required by the Law, under the name “NHC ASC –
Dallas, LLC”. The Members hereby continue the existence of the Company. Except
as stated in this Agreement, the Law shall govern the rights and liabilities of
the Members. 

2.2 Certificates. The Members agree to execute from time
to time all such certificates and other documents as may be appropriate to
comply with the requirements for the transaction of business or ownership or leasing of
property in all jurisdictions where the Company may from time to time desire to
conduct business or own or lease property. The Board of Managers shall effect
all such filing, recording, publishing, and perform such other acts as may be
appropriate to comply with all requirements for the operation of the Company. 

2.3 Company Name. The business of the Company shall be
conducted under the name “Northstar Surgery Center, Dallas” or under such other
name or names as the Board of Managers may determine. The Board of Managers or
the officers of the Company shall promptly execute and file with the proper
offices in each county in each jurisdiction in which the Company conducts
business one or more certificates as required by the fictitious name act,
assumed name act, or similar statute in effect as to each such jurisdiction.

2.4 Principal Office. The principal office of the
Company shall be located at 4120 Southwest Freeway, Suite 150, Houston TX 77027
or at such other place or places as the Board of Managers may from time to time
determine. 

2.5 Term. The Company shall continue in existence until
the Company is dissolved pursuant to Article XVI. 

2.6 Registered Agent and Office. The registered agent of
the Company shall be Northstar Healthcare Inc. and the registered office of the
Company shall be located at 4120 Southwest Freeway, Suite 150, Houston TX 77027.
The registered office or the registered agent, or both, may be changed by the
Board of Managers from time to time by filing the statement required by the Law.
The Company shall maintain at its registered office such records as may be
specified by the Law. 

2.7 Characterization. For federal income tax purposes,
the Company shall be characterized as a partnership. However, for state law
purposes, the Company shall not be characterized as, nor treated as, a
partnership, nor shall any Member be characterized as, nor treated as, a
partner. The Board of Managers shall operate the Company in a manner consistent
with such characterizations and neither the Board of Managers nor any Member
shall take any act, or fail to take any act, which is not consistent with such
characterizations. 

ARTICLE III. 

BUSINESS OF THE COMPANY 

3.1 Business. The business of the Company is (a) to
lease, manage and operate the Surgery Center and provide certain medical and
ancillary health care services at the Surgery Center; (b) to enter into, from
time to time, such financial arrangements as the Board of Managers may determine
to be necessary, appropriate or advisable (including, without limitation,
borrowing money and issuing evidences of indebtedness and securing the same by
mortgage, deed of trust, security interest or other encumbrance upon one or more or all of the Company assets); (c) to sell,
assign, lease, exchange or otherwise dispose of, or refinance or additionally
finance, any or all of the Company assets; (d) to raise additional capital by
issuance of additional Interests as provided in Section 14.4; and (e) generally
to engage in such other businesses and activities and to do any and all other
acts and things that the Board of Managers deem necessary, appropriate or
advisable from time to time in furtherance of the purposes of the Company as set
forth in this Section 3.1. 

3.2 Powers. Subject to the limitations contained in this
Agreement and in the Law, the Company’s purposes may be accomplished by the
Board of Managers taking any action permitted under this Agreement that, in the
good faith judgment of the Board of Managers, is customary or reasonably related
to accomplishing such purposes. 

ARTICLE IV. 

CONTRIBUTIONS OF CAPITAL 

4.1 Initial Capital Contributions and Interests. The
initial Capital Contributions of the Members will be the amount set forth
opposite each Member’s name on Exhibit A, which is attached hereto and
incorporated by reference herein. The initial Interest of each Member is set
forth opposite each Member’s name on Exhibit A. Each Member shall
contribute the initial Capital Contribution set forth opposite such Member’s
name on Exhibit A at such time as the Board of Managers shall determine,
in return for such Member’s initial Interest. Interests may be changed from time
to time in accordance with this Agreement.

4.2 Future Capital Contributions.

(a) The Members acknowledge that, following the initial Capital
Contributions to be made by the Members pursuant to Section 4.1 above, the
Company may require funds from time to time for various reasons, including,
without limitation, related to the payment of taxes, insurance, debt service,
maintenance and repair costs and other operating charges and operating expenses.
The Members hereby acknowledge that from time to time the Board of Managers,
upon the prior approval of a Required Interest of the Members, may request that
the Members contribute in cash to the capital of the Company such additional
funds as are required for the business of the Company as determined by the Board
of Managers, in their sole and absolute discretion. Any additional Capital
Contributions requested by the Board of Managers pursuant to this Section 4.2
and in excess of the initial Capital Contributions required pursuant to Section
4.1 above are referred to herein as “Discretionary Contribution(s).” At the time
the Board of Managers requests any Discretionary Contribution from the Members,
such request will be made in writing to each of the Members of the Company and
will specify (i) such Member’s Proportionate Share of the Discretionary
Contribution, and (ii) the date on or before which such Discretionary
Contribution should be made to the Company (“Contribution Time”). 

(b) If any Member declines to make all or any portion of such
Member’s Proportionate Share of a Discretionary Contribution (“Declining
Member”) within ten (10) days after the Contribution Time pursuant to Section
4.2(a) above, the Board of Managers, in their sole and absolute discretion, may
take any one (1) or more of the following actions: 

(i) permitting the other Member(s) in proportion to their
Percentage Interests or in such other percentages as they may agree (the
“Lending Member”, whether one or more), to advance the portion of any Declining
Member’s Proportionate Share of the Discretionary Contribution which such
Declining Member failed to contribute to the Company on or before the
Contribution Time pursuant to Section 4.2(a) above, with such advancement to be
treated as a loan by the Lending Member to the Company and bearing interest at
the lesser of (x) the Prime Rate plus five percent (5%), and (y) the maximum
rate permitted by applicable law; and 

(ii) reducing any Declining Member’s Interest and increasing
the Interest of each of the other Member(s) who contributed all of such Member’s
Proportionate Share of the Discretionary Contribution on or before the
Contribution Time pursuant to Section 4.2(a) above (the “Curing Member,” whether
one or more) as set forth below. The Interest of each Declining Member will be
decreased, but not below zero, in the following manner:

(A) the Board of Managers will create a fraction, the numerator
of which will be 100% of the amount that the Declining Member failed to
contribute on or before the Contribution Time pursuant to Section 4.2(a) above
based upon such Declining Member’s Proportionate Share, and the denominator of
which will be the cumulative Gross Asset Value of the Company’s assets (as
determined by the Board of Managers in their reasonable discretion), with such
Gross Asset Value including the total amount of the Discretionary Contribution
that is requested by the Board of Managers less Company liabilities, 

(B) the fraction will be converted to an Interest (i.e. 1/50 =
2%, 1/10 = 10%, etc.), and the amount of such Interest will be deducted from the
Declining Member’s Interest, 

(C) the Interest of the Curing Members will be increased (such
increase to be divided among the Curing Members based upon their pro rata share
of the amount of the Declining Member’s Proportionate Share that the Declining
Member failed to contribute on or before the Contribution Time pursuant to
Section 4.2(a) above), but not in excess of the reduction of the
Declining Member’s Interest as provided in (B) above, and 

(D) such computation of the reduction of the Declining Member’s
Interest and increase in the Curing Members’ Interests will be calculated and
reallocated with respect to each Declining Member and Curing Member, as
applicable. 

In the event of any adjustment of Interests pursuant to this
Section 4.2(b)(ii), no Member will have the right to modify, rectify or undo
such adjustments thereafter, and such adjustment will be made without the need
for any further act, writing or consent to effect any such adjustment. Each
Declining Member and Curing Member hereby appoints the Board of Managers, or any
officer designated by the Board of Managers, as the Declining Member’s and
Curing Member’s duly authorized agent and attorney-in-fact for purposes of
preparing and executing any amendments to this Agreement necessary to reflect
any adjustment of Interests under this Section 4.2(b)(ii) . 

4.3 Personal Liability and Security for Capital. Each
Member will be personally liable to the Company to contribute to the capital of
the Company the full amount of such Member’s Capital Contributions in accordance
with Sections 4.1 and 4.2 above. Each Member grants to the Company a lien on
such Member’s Interest in the Company to secure payment of any and all Capital
Contributions required under Section 4.1 and/or 4.2 above and the performance of
any and all obligations required or permitted hereunder. 

4.4 Liability of Members. Each Member will be liable for
the repayment and discharge of debts and obligations of the Company only to the
extent of the amounts contributed or required to be contributed by that Member
pursuant to the provisions of this Article IV. After such required
contributions, the Members will not otherwise have any liability with respect to
the debts and obligations of the Company and will not otherwise be obligated to
make additional contributions to the Company. No Member will be required to make
any contribution to the Company beyond that required under this Article IV. In
accordance with state law, a Member of a limited liability company may, under
certain circumstances, be required to return to the limited liability company,
for the benefit of creditors, amounts previously distributed to that Member as a
return of capital. It is the intent of the Members that no distribution of cash
to any Member will be deemed a return or withdrawal of capital (even if that
distribution is treated, in whole or in part, for any purpose as a distribution
out of a reserve for depreciation or other reserve which is attributable to
depreciation or any other non-cash item accounted for as a loss or deduction
from or offset to the Company’s income), and that no Member will be obligated to
pay any such amount to or for the account of the Company or any creditor of the
Company. However, if any court of competent jurisdiction holds that,
notwithstanding the provisions of this Agreement, a Member is obligated to make
any such payment, that obligation will be the obligation of that Member.

4.5 Loans. Any Member, with the consent of the Board of
Managers, may lend money to the Company. If any Member makes any loan or loans
to the Company, the amount of any such loan shall not be treated as a
contribution to the capital of the Company, but shall be a debt due from the
Company. Any Member’s loan to the Company shall be repayable out of the
Company’s cash and shall bear interest at such rate as may be mutually agreed
upon by the Company and the Member loaning funds to the Company. None of the
Members, or any of their Affiliates, shall be obligated to loan money to the
Company. 

4.6 Guarantee of Company Debt Obligations. The Members
acknowledge that after the Effective Date the Company may desire to establish a
revolving line of credit and/or other credit facilities with financial
institutions to fund certain capital expenditures and/or operation costs. The
Members further acknowledge that in connection with establishing any such lines
of credit and/or credit facilities, the lender(s) may require the Members to
guaranty their respective Proportionate Shares of the amounts due to such
lender(s) thereunder. Therefore, upon the approval of the establishment of a
line of credit or other credit facility on behalf of the Company by a Required
Interest of the Members, the Board of Managers may require that each Member, or
an Affiliate thereof acceptable to the Board of Managers, (i) deliver to the
proposed lender(s) such financial information with respect to such Member or
Affiliate, as appropriate, as such lender(s) may request, and (ii) execute and
deliver to the proposed lender(s) such forms of guaranty as may be mutually
agreed upon by the Company and such lender(s). Notwithstanding anything
contained in this Agreement to the contrary, no Member or Affiliate thereof
shall be obligated to guaranty more than its Proportionate Share of any line of
credit or credit facility established for the benefit of the Company.

4.7 Obligation to Deliver Documents. Each Member shall
have the initial and continuing obligation, as a condition to such Member’s
continuation as a Member in this Company, to deliver or cause to be delivered to
the Board of Managers or the Governing Board, as requested from time to time,
such documents and instruments as may be requested on behalf of the Company to
confirm such Member’s participation in and/or obligations to the Company,
including but not limited to documents pertaining to such Member’s guaranty of
any line of credit or credit facility established pursuant to Section 4.6, and
an annual Eligibility Affirmation Statement in such form as may be from time to
time approved by the Governing Board; provided, however, that no Member
shall be required to submit an annual Eligibility Affirmation Statement on or
before January 1, 2016. Any failure of a Member to timely furnish the documents
or instruments reasonably requested by the Board of Managers and/or Governing
Board shall constitute a breach of this Agreement. 

ARTICLE V. 

CAPITAL ACCOUNTS 

5.1 No Interest on Capital Contributions. No Member will
be paid interest on any Capital Contribution. 

5.2 Treatment of Capital Contributions and Restrictions on
the Right to Withdraw or to be Redeemed from the Company. Except as
specifically provided in Article XV, the Company will not be required to redeem
or repurchase any Interest, and no Member will have the right or power to
withdraw, or receive any return of such Member’s Capital Contribution. 

5.3 Capital Accounts. A Capital Account will be
established for each Member on the books and records of the Company and will be
maintained for each Member in accordance with the Code and the Treasury
Regulations. 

5.4 Capital Accounts Upon Transfer. In the event any
Interest is transferred in accordance with the terms of this Agreement, the
transferee will succeed to the Capital Account of the transferor to the extent
it relates to the transferred Interest, except as provided in the Treasury
Regulations. 

5.5 Adjustment of Capital Accounts. In the event the
Gross Asset Values of Company assets are adjusted pursuant to this Agreement,
the Capital Accounts of all Members will be adjusted simultaneously to reflect
the aggregate net adjustment as if the Company recognized gain or loss equal to
the amount of such aggregate net adjustment. The foregoing provisions and the
other provisions of this Agreement relating to the maintenance of Capital
Accounts are intended to comply with Section 1.704 -1(b) of the Treasury
Regulations, and will be interpreted and applied in a manner consistent with
such Treasury Regulations. 

ARTICLE VI. 

ALLOCATIONS 

6.1 Profits and Losses. After giving effect to the
special allocations set forth in Sections 6.2, 6.3 and 6.6, Profits and Losses
for any fiscal year of the Company or other period shall be allocated to the
Members in accordance with their respective Percentage Interests.

6.2 Special Allocations. 

(a) Company Minimum Gain Chargeback. Notwithstanding any
other provision of this Article VI, if there is a net decrease in Company
Minimum Gain during any Company fiscal year or other period for which
allocations are made, prior to any other allocation under this Agreement, each
Member shall be specially allocated items of Company income and gain for that
period (and, if necessary, subsequent periods) in proportion to, and to the
extent of an amount equal to such Member’s share of the net decrease in Company
Minimum Gain during such year, determined in accordance with Regulations section
1.704 -2(g)(2). Allocations pursuant to the previous sentence shall be made in
proportion to the respective amounts required to be allocated to each Member
pursuant thereto. The items to be so allocated shall be determined in accordance
with Regulations section 1.704 -2(g)(2). This Section 6.2(a) is intended to
comply with the minimum gain chargeback requirement in Regulations section 1.704
-2(f) and shall be interpreted consistently therewith. To the extent permitted
by such section of the Regulations and for purposes of this Section 6.2(a) only,
each Member’s Adjusted Capital Account Deficit shall be determined prior to any
other allocations pursuant to this Article VI with respect to such fiscal year
and without regard to any net decrease in Member Loan Minimum Gain during such
fiscal year. 

(b) Member Loan Minimum Gain Chargeback. Notwithstanding
any other provision of this Article VI except Section 6.2(a) hereof, if there is
a net decrease in Member Loan Minimum Gain attributable to a Member Loan
Nonrecourse Debt during any Company fiscal year, each Member who has a share of
the Member Loan Minimum Gain attributable to such Member Loan Nonrecourse Debt,
determined in accordance with Regulations section 1.704 -2(i)(5), shall be
specially allocated items of Company income and gain for such year (and, if
necessary, subsequent years) in an amount equal to such Member’s share of the
net decrease in Member Loan Minimum Gain attributable to such Member Loan
Nonrecourse Debt that is allocable to the disposition of Company property
subject to such Member Loan Nonrecourse Debt, determined in accordance with
Regulations section 1.704 -2(i)(4). Allocations pursuant to the previous
sentence shall be made in proportion to the respective amounts required to be
allocated to each Member pursuant thereto. The items to be so allocated shall be
determined in accordance with Regulations section 1.7042(j)(2) . This Section
6.2(b) is intended to comply with the minimum gain chargeback requirement in
Regulations section 1.704 -2(i)(4) and shall be interpreted consistently
therewith. Solely for purposes of this Section 6.2(b), each Member’s Adjusted
Capital Account Deficit shall be determined prior to any other allocations
pursuant to this Article VI with respect to such fiscal year, other than
allocations pursuant to Section 6.2(a) hereof. 

(c) Qualified Income Offset. In the event any Member
unexpectedly receives any adjustments, allocations, or distributions described
in Regulations section 1.704 -1(b)(2)(ii)(d)(4), 1.704 -1(b)(2)(ii)(d)(5), or
1.704 -1(b)(2)(ii)(d)(6) which results in an Adjusted Capital Account Deficit of
a Member, items of Company income and gain shall be specially allocated to each
such Member in an amount and manner sufficient to eliminate, to the extent
required by the Regulations, the Adjusted Capital Account Deficit of such Member
as quickly as possible, provided that an allocation pursuant to
this Section 6.2(c) shall be made if and only to the extent that such Member would have an
Adjusted Capital Account Deficit after all other allocations provided for in
this Article VI have been tentatively made as if this Section 6.2(c) were not in
this Agreement. 

(d) Gross Income Allocation. In the event any Member has
a deficit Capital Account at the end of any Company fiscal year that is in
excess of the sum of (i) the amount such Member is obligated to restore
(pursuant to such Member’s obligation to make a special contribution or
otherwise), and (ii) the amount such Member is deemed to be obligated to restore
pursuant to the penultimate sentences of Regulations section 1.704 -2(g)(1) and
1.704 -2(i)(5), each such Member shall be specially allocated items of Company
income and gain in the amount of such excess as quickly as possible;
provided, that, an allocation pursuant to this Section 6.3(d)
shall be made if and only to the extent that such Member would have a deficit
Capital Account in excess of such sum after all other allocations provided for
in this Article VI have been tentatively made as if Section 6.2(c) hereof and
this Section 6.2(d) were not in this Agreement. 

(e) Member Loan Nonrecourse Deductions. Any Member Loan
Nonrecourse Deductions for any fiscal year or other period shall be specially
allocated to the Member who bears the economic risk of loss with respect to the
Member Loan Nonrecourse Debt to which such Member Loan Nonrecourse Deductions
are attributable in accordance with Regulations section 1.704 -2(i)(2). 

(f) Section 754 Adjustment. To the extent an adjustment
to the adjusted tax basis of any Company asset pursuant to Code section 734(b)
or Code section 743(b) is required, pursuant to Regulations section 1.704
-1(b)(2)(iv)(m), to be taken into account in determining Capital Accounts, the
amount of such adjustment to the Capital Accounts shall be treated as an item of
gain (if the adjustment increases the basis of the asset) or loss (if the
adjustment decreases such basis) and such gain or loss shall be specially
allocated to the Members in a manner consistent with the manner in which their
Capital Accounts are required to be adjusted pursuant to such section of the
Regulations. 

6.3 Curative Allocations. Any allocations of items of
income, gain or loss pursuant to Sections 6.2(a) -(e) shall be taken into
account in computing subsequent allocations pursuant to this Article VI, so that
the net amount of any items so allocated and the income, losses and other items
allocated to each Member pursuant to this Article VI shall, to the extent
possible, be equal to the net amount that would have been allocated to each
Member had no allocations ever been made pursuant to Sections 6.2(a) -(e). 

6.4 Other Allocation Rules. 

(a) Except as otherwise provided in this Agreement, all items
of Company income, gain, loss, deduction, and any other allocations not
otherwise provided for shall be divided among the Members in the same
proportions as such Members share Profits or Losses pursuant to Sections 6.1 for
the fiscal year. 

(b) The Members are aware of the income tax consequences of the
allocations made by this Article VI and hereby agree to be bound by the
provisions of this Article VI in reporting their share of Company income and
loss for income tax purposes. 

(c) Solely for purposes of determining a Member’s proportionate
share of the “excess nonrecourse liabilities” of the Company within the meaning
of Regulations section 1.752 -3(a)(3), the Members’ interests in Company profits
are in the same proportions as they share Profits pursuant to Section 6.1 for
the fiscal year. 

(d) To the extent permitted by sections 1.704 -2(h) and 1.704
-2(i)(6) of the Regulations, the Board of Managers shall endeavor to treat
distributions of Available Cash as having been made from the proceeds of a
Nonrecourse Liability or a Member Loan Nonrecourse Debt, only to the extent that
such distributions would cause or increase an Adjusted Capital Account Deficit
for any Member. 

(e) Notwithstanding anything to the contrary contained herein,
items of income, gain, loss and deduction with respect to property, other than
cash, contributed to the Company by a Member shall be allocated among the
Members so as to take into account the variation between the basis of the
property to the Company and its fair market value at the time of contribution as
provided in Section 704(c) of the Code and Treasury Regulations section 1.704
-1(b)(2)(iv)(g). In the event the Gross Asset Value of any Company property is
adjusted in accordance with the definition thereof in Article I hereof,
subsequent allocations of income, gain, loss, and deduction with respect to such
asset shall take account of any variation between the adjusted basis of such
asset for Federal income tax purposes and its Gross Asset Value in the same
manner as under Code section 704(c) and the Regulations thereunder. 

Any elections or other decisions relating to such allocations
shall be made by the Board of Managers in any manner that reasonably reflects
the purpose and intention of this Agreement. Allocations pursuant to this
Section 6.4(e) are solely for purposes of Federal, state, and local taxes and
shall not affect, or in any way be taken into account in computing, any Member’s
Capital Account or share of Profits, Losses, or other items or distributions
pursuant to any provision of this Agreement. 

(f) As long as consistent with the other provisions of this
Article VI, to the extent that gain from the disposition of any Company property
is, for Federal income tax purposes, taxable as ordinary income by reason of
recapture of depreciation or cost recovery deductions taken with respect to such
property, such depreciation recapture shall be allocated among the Members in
proportion to the depreciation or cost recovery deductions previously allocated
among them with respect to such property; provided, however, that
in the event the depreciation recapture is less than the aggregate amount of
depreciation or cost recovery deductions giving rise to the depreciation
recapture allocated among such Members with respect to such property, the
depreciation recapture will be allocated among such Members based on the order
in time the Members have been allocated such deductions with respect to such
property. 

6.5 Assignment During Fiscal Year. If a Member's
Interest is transferred at any time other than the end of a fiscal year of the
Company, the allocable share of the various items of Company Profit, Loss and
credit will be allocated between the transferor and the transferee in the same
ratio as the number of days in the fiscal year, respectively, before and after
the transfer is recognized by the Company, as such number of days bears to the
number of days in the entire year or will be allocated as if the books of the
Company closed on the day of the transfer. Such method of allocation will be
determined by the transferor and transferee of such Interest. 

ARTICLE VII. 

DISTRIBUTIONS 

7.1 Distributions of Available Cash. Except as otherwise
provided in this Article VII, Available Cash shall be distributed to the Members
in accordance with their respective Percentage Interests. No cash distributions
will be made which will impair the ability of the Company to pay its just debts
as they mature. Except as otherwise provided herein, there will be no obligation
by the Company to return to the Members, or to any one of them, any part of
their Capital Contributions to the Company, for so long as the Company continues
in existence. 

7.2 Distribution for Taxes. To the extent the Members
determine the Company has Available Cash in any period with respect to which
taxes or estimated taxes are due, the Company shall promptly declare and make
cash distributions pursuant hereto to the Members to allow the federal income
tax (including, without limitation, estimated tax payments) attributable to the Company’s taxable income
allocable to the Members to be paid by such Members when due (each, a “Due
Date”). To satisfy this requirement, the Company shall pay on or before thirty
(30) days prior to each Due Date (any such payment a “Tax Distribution”), an
amount equal to the product of (i) the Company’s positive taxable income
attributed to its Members during the relevant period multiplied by (ii) the
highest applicable federal income tax rate for individuals for the fiscal year
in which the relevant period falls. Tax Distributions shall be made to the
Members in proportion to the taxable income allocated to them in the relevant
period. Any distribution made pursuant to this Section 7.2 shall be treated as
an advance on any distributions made pursuant to Section 7.1 and Section 16.2(b)
..

ARTICLE VIII. 

BANK ACCOUNTS, BOOKS OF ACCOUNT 
AND TAX
COMPLIANCE 

8.1 Bank Accounts; Investments. The Board of Managers or
officers of the Company may establish one or more bank accounts into which all
Company funds shall be deposited. Funds deposited in the Company’s bank accounts
may be withdrawn only to pay Company debts or obligations or to be distributed
to the Members under this Agreement. Company funds, however, may be invested in
such securities and investments as the Board of Managers or officers of the
Company may select, until withdrawn for Company purposes. The funds of the
Company may not be commingled with the assets of any other Person. 

8.2 Books and Records. The officers of the Company,
subject to the oversight of the Board of Managers, shall keep books of account
and records relative to the Company’s business. The books shall be prepared in
accordance with generally accepted accounting principles consistently applied.
The cash method of accounting shall be used by the Company for income tax
purposes. The Company’s books and records shall at all times be maintained at
the principal business office of the Company or its accountants (and to the
extent required by the Law, at the registered office of the Company) and such
books and records (or copies thereof) shall be available for inspection at the
principal office of the Company (or such other location as shall be determined
by the Board of Managers) by the Members or their duly authorized
representatives during reasonable business hours. The books and records shall be
preserved for at least four (4) years after the term of the Company ends. 

8.3 Determination of Profit and Loss; Financial
Statements. All items of Company income, expense, gain, loss,
deduction and credit shall be determined with respect to, and allocated in
accordance with, this Agreement for each Member for each Company fiscal year.
Within ninety (90) days after the end of each Company fiscal year, the Board of
Managers shall cause to be prepared and furnished to each Member of record as of
the last day of such fiscal year, at the Company’s expense, unaudited financial
statements of the Company for the preceding fiscal year, including, without
limitation, a balance sheet, profit and loss statement, statement of cash flows
and statement of the balances in the Members’ Capital Accounts,
prepared in accordance with the terms of this Agreement and generally accepted
accounting principles consistently applied. These financial statements shall be
available for inspection and copying during ordinary business hours at the
reasonable request of any Member, and will be furnished to any Member upon
written request therefore. In addition, as soon as practicable, but in no event
later than forty-five (45) days after the close of each fiscal quarter, except
the last fiscal quarter of each fiscal year, the Board of Managers shall furnish
to each Member of record on the closing date of that fiscal quarter a quarterly
report for the fiscal quarter containing such financial and other information
with respect to the Company as the Board of Managers deems appropriate. In
addition, as soon as practicable, but in no event later than thirty (30) days
after the end of each calendar month, except the last calendar month of each
year, the Board of Managers shall furnish to each Member of record on the last
day of that calendar month, a monthly report for the month containing such
financial and other information with respect to the Company as the Members and
the Board of Managers mutually agree to be appropriate. 

8.4 Tax Returns and Information. The Members intend for
the Company to be treated as a partnership, rather than as an association
taxable as a corporation, for federal income tax purposes. The officers of the
Company, subject to the oversight of the Board of Managers, shall prepare or
cause to be prepared all Federal, state and local income and other tax returns
which the Company is required to file and shall furnish such returns to the
Members, together with any other information which any Member may reasonably
request relating to such returns, within ninety (90) days after the end of each
Company fiscal year. 

8.5 Tax Audits; Tax Matters Member. Northstar Healthcare
Acquisitions, LLC shall be the tax matters partner (the “TMP”) of the Company
under section 6231(a)(7) of the Code. The TMP shall inform the Members of all
matters which may come to his attention in his capacity as tax matters partner
by giving the Members notice thereof within ten (10) days after becoming so
informed. The TMP shall not take any action contemplated by sections 6222
through 6232 of the Code unless the TMP has first given the Members notice of
the contemplated action and received the approval of a Required Interest of the
Members to the contemplated action. This provision is not intended to authorize
the TMP to take any action that is left to the determination of the individual
Member under sections 6222 through 6232 of the Code. 

8.6 Fiscal Year. The Company fiscal year shall be the
calendar year. 

ARTICLE IX. 

BOARD OF MANAGERS 

9.1 Management by the Board of Managers. Subject to the
consent of the Members where required by this Agreement or by the Law, the
Company will be managed by the Board of Managers. Unless otherwise set
forth herein, all decisions relating to the business and affairs of the Company
shall be made by Board of Managers. Except as otherwise expressly provided in
this Agreement, all decisions required or permitted to be made by the Board of
Managers under this Agreement may be made and any necessary action taken upon
the majority vote of the Board of Managers. In making such decisions, the Board
of Managers will exercise ordinary, prudent business judgment. All such
decisions by the Board of Managers hereunder will be binding upon all of the
Members. All approvals, consents, etc. required herein may be prospective or
retroactive, unless otherwise specifically required by this Agreement or the
Law. 

In performing their respective duties hereunder, the officers
of the Company and the Board of Managers shall be entitled to rely on
information, opinions, reports or statements, including financial statements and
other financial data, of attorneys, accountants and other employees or agents of
the Company who the officer or the Board of Managers member, as appropriate,
reasonably believe to be reliable and competent in the matters presented.

9.2 No Control By Members. No Member (except a Member
who may also be a Manager or officer, and then only in such capacity within the
scope of his, her or its authority hereunder) will participate in or have any
control over the Company business or will have any authority or right to act for
or bind the Company. All Members hereby consent to the exercise by the Board of
Managers of the powers conferred on the Board of Managers by this Agreement.

9.3 Number; Election. There shall be up to five (5)
Managers of the Company who need not be Members or residents of the State of
Texas. The number of Managers may be increased or decreased from time to time by
amendment to this Agreement.

9.4 Appointment. The Class A Members and the Class B
Member(s) shall be entitled to appoint at each annual meeting of the Members,
five (5) Managers, in the aggregate, as set forth below: 

(a) The Class A Member shall be entitled to appoint two (2)
Managers (the “Class A Managers”). In appointing such Managers, the Class A
Members will vote their shares in accordance with Section 9.9, and Managers will
be appointed based on a plurality vote of the Class A Members voting. 

(b) The Class B Member(s) shall be entitled to appoint three
(3) Managers (the “Class B Managers”). In appointing such Managers, the Class B
Member(s) will vote their shares in accordance with Section 9.9, and Managers
will be appointed based on a plurality vote of the Class B Member(s) voting.

9.5 Board of Managers. The Board of Managers of the
Company effective as of the date of this Agreement shall consist of the
following Persons: 

	Name of Manager 	Type of Appointee 
	Dirk Rodriguez, M.D. 	Class A Appointee 
	Nirmal Jayaseelan, M.D. 	Class A Appointee 
	Harry Fleming 	Class B Appointee 
	Kenneth Efird 	Class B Appointee 
	Donald Kramer, M.D. 	Class B Appointee 

Each of such individuals shall hold his office until his death,
resignation or removal or until his successor shall thereafter have been duly
elected and qualified. Each of the parties by signing this Agreement consents to
the appointment of the initial Board of Managers as listed above, effective
immediately as of the date of this Agreement.

9.6 Removal of Managers. The Class A Member(s) shall at
all times have the right to cause the other Members to remove, with or without
cause, any of the Class A Managers. The Class B Member(s) shall at all times
have the right to cause the other Members to remove, with or without cause, any
of the Class B Managers. 

9.7 Vacancies.

(a) If a vacancy is created on the Board of Managers by reason
of the death, disability, removal (in accordance with Section 9.6) or
resignation of any one of the Board of Managers, the party which, under Section
9.4 is entitled to appoint the Manager whose death, disability, removal or
resignation resulted in such vacancy shall be entitled to designate a new
Manager in accordance with the procedures set forth in Section 9.4, and the
remaining Board of Managers, if any, shall meet within ten (10) days after the
date such vacancy occurs for the purpose of electing the designated new Manager
to fill such vacancy. 

(b) If the party entitled to appoint a Manager to fill any such
vacancy shall fail to appoint a Manager within ten (10) days after the vacancy
is created, such vacancy shall be filled with any individual selected by the
vote of a Majority Interest of the Members. 

9.8 Action by Members to Reconstitute Board of Managers.
If at any time and for any reason the Board of Managers shall fail to be
constituted as required by this Article IX, then, at the request of the Members
holding at least ten percent (10%) of the Percentage Interests then outstanding, the Company shall cause
a special meeting of Members to be held or shall act by written consent of
Members without a meeting for the purpose of taking whatever action may be
necessary to assure that the Board of Managers is constituted as set forth in
this Article IX as promptly as practicable. 

9.9 Certain Covenants. Each Member agrees to vote, in
person or by proxy, all Interests over which he, she or it may exercise voting
power, at any annual meeting of Members of the Company called for the purpose of
voting on the election of Managers or to execute written consents of Members
without a meeting with respect to the election of Managers to cause the
individuals appointed to the Board of Managers in accordance with the applicable
provisions of this Agreement to serve as the members of the Board of Managers.
The Company shall use its best efforts to cause the individuals appointed to the
Board of Managers in accordance with the applicable provisions of this Agreement
to serve as the members of the Board of Managers. Each Member shall vote all
Interests over which he, she or it may exercise voting power and shall take all
other actions necessary and appropriate (including, without limitation, removing
any Manager) to ensure that the Company’s Certificate of Formation (as amended)
does not at any time conflict with the provisions of this Agreement.

9.10 Restrictions on Certain Board Actions. The Board of
Managers shall not take any action with respect to any of the following matters
except upon the prior approval of a Required Interest of the Members: 

	 	i. 	
      Amend this Agreement (except as provided in Section
      20.6);

	 	 	 
	 	ii. 	
      Perform any act which would make it impossible to carry
      on the business of the Company;

	 	 	 
	 	iii. 	
      Sell all or substantially all of the assets of the
      Company;

	 	 	 
	 	iv. 	
      Dissolve the Company;

	 	 	 
	 	v. 	
      Confess a judgment against the Company, except in
      connection with the settlement of an action or proceeding;

	 	 	 
	 	vi. 	
      Change or reorganize the Company into any other legal
      form;

	 	 	 
	 	vii. 	
      Grant loans to any employee, officer, Affiliate or Member
      of the Company;

	 	 	 
	 	viii. 	
      Amend the Company’s Certificate of Formation;

	 	 	 
	 	ix. 	
      Admit an Additional Member;

	 	x. 	
      Award and/or pay any compensation to any Manager as
      contemplated by Section 8.14 or any officer of the Company as contemplated
      by Section 9.7;

	 	 	 
	 	xi. 	
      Form a subsidiary or acquire or exchange equity interests
      in another company or business activity;

	 	 	 
	 	xii. 	
      Merge or consolidate with any other company;

	 	 	 
	 	xiii. 	
      Amend or terminate that certain Management Services
      Agreement by and between the Company and Northstar Healthcare Management –
      Dallas, LLC;

	 	 	 
	 	xiv. 	
      Change the number of Managers that may be appointed by
      any class of Units;

	 	 	 
	 	xv. 	
      Establish any line of credit or credit facility for the
      benefit of the Company that contemplates the personal guarantee of any of
      the Members, as contemplated by Section 4.6;

	 	 	 
	 	xvi. 	
      Do any act in contravention of this Agreement;

	 	 	 
	 	xvii. 	
      Elect to have the Company participate in Medicare,
      Medicaid or any other federal or state health care program;

	 	 	 
	 	xviii. 	
      Request that any Member contribute any cash in excess of
      such Member’s initial Capital Contribution;

	 	 	 
	 	xix. 	
      Determine that an Adverse Terminating Event has occurred
      with respect to a Member;

	 	 	 
	 	xx. 	
      Approve the tax matters partner taking any action
      contemplated by Code Sections 6222 through 6232, as provided in Section
      8.5;

	 	 	 
	 	xxi. 	
      Adopt any capital improvement plan with respect to the
      Surgery Center or, in any fiscal year, approve any single capital
      expenditure of at least $50,000 or multiple capital expenditures of an
      aggregate of $100,000 or more; or

	 	 	 
	 	xxii. 	
      Amend this Agreement.

The limitations in this Section 9.10 shall not be applicable to
the Board of Managers or any Liquidator in winding up and liquidating the
business of the Company under Article XVI. 

9.11 Meetings of the Board of Managers. Meetings of the
Board of Managers may be called by any Manager or the President. The notice of a
meeting shall state the nature of the business to be transacted at such meeting,
and actions taken at any such meeting shall be limited to those matters
specified in the notice of the meeting. Notice of any meeting shall be given to
all Managers not less than three (3) and not more than thirty (30) days prior to
the date of the meeting. Except as otherwise expressly provided in this
Agreement or required by the express provisions of the Law, the majority vote of
the Managers shall control all decisions for which the vote of the Board of
Managers is required hereunder. Only the attendance of all Managers at a meeting
of the Board of Managers shall constitute a quorum. The presence of any Manager
at a meeting shall constitute a waiver of notice of the meeting with respect to
such Manager, unless such Manager is present solely to challenge the validity of
the meeting. The Managers may, at their election, participate in any regular or
special meeting by means of conference telephone or similar communications
equipment by means of which all Persons participating in the meeting can hear
each other. A Manager’s participation in a meeting pursuant to the preceding
sentence shall constitute presence in person at such meeting for all purposes of
this Agreement. 

9.12 Action Without a Meeting. Notwithstanding anything
to the contrary in this Agreement, any action that may be taken at a meeting of
the Board of Managers may be taken without a meeting if a consent in writing
setting forth the action so taken is approved by all of the Managers, which
consent may be executed in multiple counterparts. In the event any action is
taken pursuant to this Section 9.12, it shall not be necessary to comply with
any notice or timing requirements set forth in Section 9.11. 

9.13 Presumption of
Assent. A Manager who
is present at a meeting of the Board of Managers at
which action on any Company matter is taken shall be
presumed to have assented to the action taken unless his dissent shall be
entered into the minutes of the meeting or unless he or she shall file his
written dissent to such action with the person acting
as the secretary of the meeting before the adjournment thereof or shall forward
such dissent by registered mail to the secretary of the Company immediately after the adjournment of the meeting. Such right to
dissent shall not apply to a Manager who voted in
favor of any such action. 

9.14 Liability. The Managers shall perform their duties
under this Agreement with ordinary prudence and in a manner reasonable under the
circumstances. A Manager shall not be liable to the Company or the Members for
any loss or liability caused by any act, or by the failure to do any act, unless
such loss or liability arises from the Manager’s intentional misconduct, gross
negligence or fraud. In no event shall any Manager be liable by reason of a
mistake in judgment made in good faith, or action or lack of action based on the
advice of legal counsel.

9.15 Compensation. The Managers shall be entitled to
receive such compensation, if any, from the Company for services rendered on
behalf of or for the benefit of the Company as shall be determined from time to
time the Board of Managers. 

9.16 Surgery Center Medical Governing Board.

(a) Formation and Authority. The Board of Managers shall
form, or cause to be formed, the Surgery Center’s Medical Governing Board (the
“Governing Board”) which shall be responsible for, and is authorized to take all
reasonable actions in the carrying out of, (i) controlling, establishing and
carrying out the professional, medical and ethical policies of the Surgery
Center, including but not limited to admission of staff physicians, health care
practitioners and health care affiliates; and (ii) together with the
Administrator (herein defined), making, establishing and carrying out employment
and operating policies of the Surgery Center. The medical practice conducted in
the Surgery Center shall be under the supervision of the Surgery Center’s
medical staff (the “Medical Staff”) and shall be conducted in accordance with
the highest standards of medical ethics and professional competence. The
facilities of any such Surgery Center shall be available only to physicians,
health care practitioners and health care affiliates meeting such standards. At
all times, the Governing Board shall be governed by the terms of this Agreement.
In addition thereto, the Governing Board shall authorize and adopt procedures
for its own management, in its sole discretion. Such procedures shall provide
rules for the formation of committees, regular meetings and keeping of a
permanent record of the meetings of the Board of Trustees. Such procedures shall
also provide for the giving of adequate notice of meetings and for a fair and
just procedure to be followed in the processing of applications for membership
to the Medical Staff and in the reaching of evidentiary and judgmental
determinations as to the actions of any member of the Medical Staff. The
procedures shall further provide that all action taken by the Governing Board
shall be reported to the Board of Managers. The Governing Board shall be
comprised of at least six (6) voting members and one (1) non-voting member. Five
(5) voting members shall be appointed by a plurality of the Class A Members and
one (1) voting member shall be appointed by a plurality of the Class C Members;
provided, however, that each voting member of the Governing Board
must be a Physician. The practice administrator, or equivalent administrator, of
the Surgery Center (the “Administrator”) shall serve as the non-voting member of
the Governing Board. All responsibilities granted to the Governing Board under
this Agreement shall be exercised by the Governing Board as a body, and no
member of the Governing Board, acting alone, shall have the authority to act on
behalf of the Governing Board.

(b) Service on Governing Board; Terms; Removal. Each
voting member appointed to serve on the Governing Board shall serve for a term
of one (1) year and thereafter until his or her successor is appointed, unless
he or she sooner resigns or is removed in the manner described below. Any
vacancy occurring for any reason in the members of the Governing Board to be
appointed by the Class A Members or the Class C Members shall be filled by the
Class A Members or the Class C Members, as applicable. A member of the Governing
Board appointed to fill a vacancy shall be appointed for the unexpired term of
his or her predecessor in office. A member of the Governing Board appointed by
the Class A Members may be removed at any time, with or without cause,
only by the Class A Members. A member of the Governing Board appointed by the
Class C Members may be removed at any time, with or without cause, only by the
Class C Members. 

9.17 Governing Board. The members of the Governing Board
of the Company effective as of the date of this Agreement shall consist of the
following Persons: 

	Name of Appointee 	Type of Appointee 
	Nirmal Jayaseelan, M.D. 	Class A Voting Member 
	Clayton Frenzel, M.D. 	Class A Voting Member 
	Dirk Rodriguez, M.D. 	Class A Voting Member 
	To be determined 	Class A Voting Member 
	To be determined 	Class A Voting Member 
	Nick Nicholson, M.D. 	Class C Voting Member 
	Kenneth Efird 	Non-Voting Member 

9.18 Marketing Committee.

(a) Formation and Authority. The Board of Managers shall
form, or cause to be formed, an advisory marketing committee (the “Marketing
Committee”) which is charged with reviewing and recommending to the Board of
Managers, the Company’s yearly marketing budget, strategies and projections for
marketing funds, utilization of such funds and other marketing-related duties
that the Board of Managers may assign from time-to-time. Unless called into a
special session by the Board of Managers, the Marketing Committee will meet only
once a quarter and will make its recommendations to the Board of Manager no
later than three (3) business days after each such quarterly meeting. The
Marketing Committee shall be comprised of at least five (5) members, two (2) of
whom will be appointed by the Class A Members, two (2) of whom will be appointed
by the Class B Member and one (1) of whom will be appointed by the Class C
Members. All responsibilities granted to the Marketing Committee under this
Agreement shall be exercised by the Marketing Committee as a body, and no member
of the Marketing Committee, acting alone, shall have the authority to act on
behalf of the Marketing Committee. In no event shall the Marketing Committee
have the authority to act on behalf of, or to bind in any way, the Company.

(b) Service on Marketing Committee; Terms; Removal. Each
individual appointed to serve on the Marketing Committee shall serve for a term
of one (1) year and thereafter until his or her successor is appointed, unless
he or she sooner resigns or is removed in the manner described below. Any
vacancy occurring for any reason in the member of the Marketing Committee to be
appointed by the Class A Members shall be filled in the same manner. Any vacancy occurring for any reason in the members of the
Marketing Committee to be appointed by the Class A Members shall be filled by
the Class A Members. A member of the Marketing Committee elected or appointed to
fill a vacancy shall be appointed for the unexpired term of his or her
predecessor in office. A member of the Marketing Committee appointed by the
Class B Members may be removed at any time, with or without cause, by Class B
Member(s). A member of the Marketing Committee appointed by the Class A Members
may be removed at any time, with or without cause, by the Class A Members. A
member of the Marketing Committee appointed by the Class C Members may be
removed at any time, with or without cause, by the Class C Members.

9.19 Marketing Committee. The members of the Marketing
Committee of the Company effective as of the date of this Agreement shall
consist of the following Persons: 

	Name of Appointee 	Type of Appointee
  
	Dirk Rodriguez, M.D. 	Class A 
	Clayton Frenzel, M.D. 	Class A 
	Kenneth Efird 	Class B 
	Nicole Morrison 	Class B 
	Nick Nicholson, M.D. 	Class C 

ARTICLE X. 

OFFICERS 

10.1 Officers. If the Board of Managers determines the
Company should have officers, the officers of the Company shall be elected by a
majority vote of the Managers; provided, however, that election of
the President shall also require approval by a Required Interest of the Members.
An officer of the Company may also be a Manager. The Board of Managers may
choose a President, one or more Vice Presidents, a Chief Operating Officer, a
Chief Financial Officer, a Secretary, one or more Assistant Secretaries and such
other officers as the Board of Managers may determine. Any two or more offices
may be held by the same individual. 

10.2 President. The President shall be the principal
executive officer of the Company and, subject to the control of the Board of
Managers, shall in general supervise and control all of the business and affairs
of the Company. He or she shall, when present, preside at all meetings of the
Members. He or she may sign any contracts or other instruments except those
which shall be required by law, by this Agreement or by the Board of Managers to
be otherwise signed or executed; and in general shall perform all duties as may
be prescribed by the Board of Managers from time to time. The initial President
of the Company shall be Kenneth Efird. 

10.3 Vice Presidents. Each Vice President shall have
such powers and duties as the Board of Managers or the President may prescribe
or delegate to him or her. 

10.4 Chief Operating Officer. The Chief Operating
Officer shall, subject to the control of the Board of Managers and the
President, supervise and control the day-to-day administrative affairs of the
Company. He or she may sign any contracts or other instruments except those
which shall be required by law, by this Agreement or by the Board of Managers or
the President to be otherwise signed or executed; and in general shall perform
all duties as may be prescribed by the Board of Managers and the President from
time to time. 

10.5 Chief Financial Officer. The Chief Financial
Officer shall, subject to the control of the Board of Managers and the
President, have the custody of the Company’s funds, shall keep full and accurate
accounts of receipts and disbursements, and shall deposit all monies in the name
and to the credit of the Company in such depositories as may be designated by
the Board of Managers or the President. The Chief Financial Officer shall also
have the duties and responsibilities as the treasurer of the Company and shall
disburse the funds thereof as may be ordered by the Board of Managers or the
President. He or she shall render to the Board of Managers at its regular
meetings, or at such other times as the Board of Managers so requires, an
account of all his or her transactions as Chief Financial Officer, and of the
financial condition of the Company. The Chief Financial Officer shall perform
such other duties and have such other powers as the Board of Managers or the
President may from time to time prescribe. 

10.6 Secretary. The Secretary shall: (i) prepare and
keep the minutes of the meetings of the Board of Managers and the Members in one
or more books provided for that purpose; (ii) see that all notices are duly
given in accordance with the provisions of this Agreement or as required by law;
(iii) be custodian of the Company records; (iv) keep a register of the post
office address of each Member; (v) have general charge of the membership books
of the Company; (vi) authenticate records of the Company; and (vii) in general
perform all duties incident to the office of the Secretary and such other duties
as from time to time may be assigned to him or her by the President or by the
Board of Managers. In the absence of the Secretary, or in the event of his or
inability or refusal to act, the Assistant Secretary, if any, shall perform all
duties incident to the office of the Secretary and such other duties as from
time to time may be assigned to him or her by the President or by the Board of
Managers. 

10.7 Compensation. The officers of the Company shall be
entitled to receive such compensation, if any, from the Company for services
rendered on behalf of or for the benefit of the Company as shall be determined
from time to time by the Board of Managers and approved by a Required Interest
of the Members. In addition, each officer of the Company shall be reimbursed at
any reasonable time and from time to time for all out-of-pocket costs and
expenses that such officer incurs in connection with performing services as an
officer of the Company. 

10.8 Removal and Vacancies. Each officer of the Company
shall hold office until his or her successor is chosen and qualified in his or
her stead or until his or her death or until his or her resignation or removal
from office. Any officer elected by the Board of Managers may be removed either
for or without cause by the Board of Managers, but such removal shall be without
prejudice to the contract rights, if any, of the individual so removed. If the
office of any officer becomes vacant for any reason, the vacancy may be filled
by the Board of Managers. 

ARTICLE XI. 

RIGHTS, STATUS AND COVENANTS OF MEMBERS

11.1 General. Except to the extent expressly otherwise
provided in this Agreement, the Members shall not take part in the management or
control of the Company business, or sign for or bind the Company, such powers
being vested exclusively in the officers and the Board of Managers. 

11.2 Voting Rights. The Members shall have the right to
vote on all Company matters specified under the Law. Except as otherwise
expressly provided in this Agreement, any matter submitted to a vote of the
Members hereunder shall require the approval of a Majority Interest of the
Members in order to be properly approved. When voting, Members shall not vote
per capita, but based upon the Percentage Interest held by each Member. 

11.3 Limitation of Liability/Fiduciary Duties. Except as
otherwise specified in Article IV of this Agreement or the Law, no Member shall
have any personal liability whatever, solely by reason of his, her or its status
as a Member of the Company, whether to the Company, the Board of Managers or any
creditor of the Company, for the debts of the Company or any of its losses
beyond the amount of the Member’s obligation to contribute his, her or its
Capital Contribution to the Company. Unless otherwise required by law or
pursuant to Section 9.14 of this Agreement (which governs the duties of Managers
who may be Members), no Member shall owe a fiduciary duty to another Member.

11.4 Bankruptcy; Death; Etc. None of the Bankruptcy,
death, disability, declaration of incompetence or incapacity, or dissolution of
a Member shall dissolve the Company, but the rights of a Member to share in the
Profits and Losses of the Company and to receive distributions of Company funds
shall, on the happening of such an event, devolve upon the Member’s estate,
legal representative or successor in interest, as the case may be, subject to
this Agreement, and the Company shall continue as a limited liability company
under the Law. The Member’s estate, representative or successor in interest
shall be entitled to receive distributions and allocations with respect to such
Member’s interest in the Company and shall be liable for all of the obligations
of the Member. Furthermore, the Member’s estate, representative or successor in
interest shall have no right to any information or accounting of the affairs of
the Company, shall not be entitled to inspect the books or records of the
Company and shall not be entitled to any of the rights of a member under the Law or this Agreement unless
such estate, representative or successor in interest is admitted to the Company
as a Substitute Member in accordance with Section 14.2. 

11.5 Other Activities of the Members. 

(a) Rights of Members. Each Member will be free to own
or otherwise participate directly or indirectly in the ownership or operation of
any activity of any Person subject to the provisions of Sections 11.5(b) and (c)
below. Neither the Company nor any Member shall have any rights, by virtue of
this Agreement, in or to the other business ventures of any other Member (or any
officers, directors, employees or Affiliates of any Member) or to the income or
profits derived therefrom by any such Persons. 

(b) Restrictions on Members. Each Member acknowledges
that the Company will provide to each Member confidential and proprietary
information, including without limitation, information regarding its vendors,
employees, insurance arrangements, sales, purchasing, pricing, services,
computer programs, operations, marketing plans and financial performance, which
has not been previously provided to the Member. Each Member understands and
agrees that while he, she or it is a Member and prior to the dissolution or
termination of the Company for any reason, he, she or it will not, directly or
indirectly, knowingly use or disclose any Confidential Information (as
hereinafter defined) for any reason other than for the advancement of the
Company’s business. “Confidential Information” shall mean any information
relating to the Company’s business (whether proprietary or otherwise) not
generally known to the health care industry or known by a Member otherwise than
as a consequence of or through his, her or its association with the Company and
treated by the Company as being confidential, including, but not limited to,
medical staff information, treatment techniques, referral lists, employee data,
insurance billing information, research, marketing, patient and customer lists
and other patient and customer information, databases, financing sources,
methods, techniques and systems, all of which shall be deemed by the Company as
being Confidential Information. In consideration for the commitments made by the
Company herein to each Member in this Agreement regarding the Member’s
association with the Company and receipt of the Confidential Information, each
Member agrees to the restrictions set out in this Section 11.5(b) .

(c) Limitations on Restrictions. The Obligations set
forth in Section 11.5(b) hereof shall not apply, or shall terminate, with
respect to any portion of the Company’s Confidential Information which: (i) was
in a Member’s possession, free of any obligation of confidence, prior to the
Agreement, as may be proven by written documentation; (ii) is already in the
public domain at such time the Company communicates the Confidential Information
to a Member, or becomes available to the public through no breach if this
Agreement prior to communication by Member; (iii) is received independently from
a third party who is free to disclose such information to Member; (iv) is
disclosed by a Member to a third party with the express prior written permission
of the Company; and/or (v) is disclosed by a Member in order to satisfy any
legal requirement of any competent government body; provided, however, when practical Member shall
advise the Company prior to making any disclosure, or if not practical, Member
shall advise the Company immediately following such disclosure. 

(d) Additional Restrictions. In addition to the
restrictions set forth above with respect to the use and/or dissemination of
Confidential Information, each Physician Class A Member and each Physician Class
C Member (which, for further clarity, includes any individual who owns or
controls a Physician Class A Member or a Class C Member which is an entity),
recognizes and agrees that certain additional restrictions are necessary to
protect the Company’s patient base, good will, Confidential Information, and
other business interests. Each Physician Class A Member and each Class C
Member expressly agrees that while he, she or it is a Member, and for twelve
(12) months thereafter, neither such Physician Class A Member, such Physician
Class C Member, nor any of his, her or its Affiliates shall, directly or
indirectly, have any financial interest in (in any manner, including, but not
limited to, equity, debt or bond financing) or participate in any manner in the
ownership, management, operation or control of any Competing Business without
the prior written consent of the Board of Managers. Notwithstanding anything to
the contrary in this Section 11.5, no Physician Class A Member nor Class C
Member will be in violation of this Section 11.5(d) if, (i) as to any Member
being admitted on the date hereof, such Member or any Affiliate thereof had a
financial interest in a Competing Business on or before the Effective Date, and
such Physician Class A Member or Physician Class C Member provided written
notice thereof to the Board of Managers prior to his, her or its admission as a
Member; (ii) as to any Physician Class A Member or Physician Class C Member
admitted after the date hereof, such Physician Class A Member or Physician Class
C Member or any Affiliate thereof had a financial interest in a Competing
Business on or before the date such Physician Class A Member or Physician Class
C Member is admitted to the Company as a Member and such Physician Class A
Member or Physician Class C Member provided written notice thereof to the Board
of Managers prior to his, her or its admission as a Member; and (iii) a
Physician Class A Member or Physician Class C Member personally performs minor
procedures in his or her office for which no separate facility fee or “payment
differential” is charged and that are the types of procedures that have been
performed in such Member’s office during the twelve (12) months prior to such
Member’s initial acquisition of an Interest. Nothing in this Section 11.5(d)
is intended to prevent a Physician Class A Member or Physician Class C
Member from (i) practicing medicine, (ii) being a member of the medical staff of
any hospital or other health care facility, or (iii) referring patients to any
surgery center, hospital or other health care facility. 

(e) Injunctive Relief; Severability. In the event of an
actual or threatened breach by any Member of Section 11.5(b) or Section 11.5(d),
the Board of Managers shall be entitled to an injunction in any appropriate
court in Dallas County, Texas, or elsewhere, restraining the actual or
threatened breach by such Member. If a court shall hold that the duration and/or
scope (geographic or otherwise) of the agreement contained in Section 11.5(d) is
unreasonable, then, to the extent permitted by law, the court may prescribe a
duration and/or scope (geographic or otherwise) that is reasonable and
judicially enforceable. The parties agree to accept such determination, subject
to their rights of appeal, which the parties hereto agree shall be
substituted in place of any and every offensive part of Section 11.5(d), and as
so modified, Section 11.5(d) of this Agreement shall be as fully enforceable as
if set forth herein by the parties in the modified form. Nothing herein stated
shall be construed as prohibiting any party hereto from pursuing any other
remedies available for such breach or threatened breach, including the recovery
of damages. 

11.6 Compliance with Texas Business and Commerce Code
Section 15.50.

(a) The Members acknowledge and agree that Section 11.5(c) of
this Agreement does not prohibit any Physician from providing care and treatment
(including continuing care and treatment) to any patient of any Physician at any
location during or after the term of this Agreement. Accordingly, the Members
further agree that Section 15.50 of the Texas Business and Commerce Code (“TBCC
Section 15.50”) does not apply to this Agreement. Nevertheless, to the extent
the Company has custody or control of the identity and/or records of the
patients a Member (or Physician owner thereof) treated during the term of this
Agreement, such Member (or Physician owner thereof) shall have access to such
medical records of such Member’s (or Physician owner’s) patients upon
authorization of the patient and any copies of medical records for a reasonable
fee, as established by the Texas State Board of Medical Examiners, subject to
lawful policies and procedures of the Company relating to medical records and
patient identifying information. Moreover, Section 11.5(c) does not deny access
to a list of patients seen or treated by any Physician. Any access to a list of
patients or to patients’ medical records furnished pursuant to this provision
after termination of this Agreement, or after a Member ceases to be a Member,
shall not require such list or records to be provided in a format different from
that by which such records are then maintained, except with the mutual consent
of the Company and the affected Member (or Physician owner thereof). The
maintenance of records will be subject to the Company’s document retention and
destruction policies as in effect from time to time. 

(b) Since this Agreement does not restrict Physicians in the
care and treatment of patients, it is not the intention of the Company or the
Member to permit any Member to “buy out” the non-ownership and non-affiliation
covenants set forth in Section 11.5(c) . However, if a court of competent
jurisdiction or arbitrator appointed and serving in accordance with the terms
and conditions of this Agreement determines that Section 11.5(c) will not be
enforceable unless a buy-out is established as contemplated by TBCC Section
15.50(b), the Company and the Members agree that a reasonable price for the
buyout shall be, in respect of each applicable Member, the greater of
(i)Twenty-Five Thousand Dollars ($25,000) for each Unit then owned by the
applicable Member, or (ii) the Fair Market Value Price of the Interest then
owned by such Member. In addition, upon any such buy-out, the Interest of the
Member that exercises any buy-out under TBCC Section 15.50(b) shall
automatically be forfeited by such Member and shall revert to the Company. This
Section 11.6(b) is intended to apply if, and only if, in the absence of this
provision, an appropriate court or arbitrator would render any non-ownership or
non-affiliation covenant set forth in Section 11.5(c) unenforceable and/or void.
Otherwise, this Section 11.6(b) shall have no force or effect whatsoever. If
this Section 11.6(b) applies to a Member, and all requirements hereof
(including payment of all amounts due and forfeiture of the applicable Interest)
are complied with, then the covenants of Section 11.5(c) shall not be enforced
with respect to the particular Physician Class A Member (or Physician owner
thereof). 

ARTICLE XII. 

MEETINGS AND VOTING 

12.1 Meetings of the Members. Meetings of the Members
may be called by the Board of Managers and shall be promptly called upon the
written request of any one or more Members who own in the aggregate ten percent
(10%) or more of the aggregate Interests owned by all Members. The notice of a
meeting shall state the nature of the business to be transacted at such meeting,
and actions taken at any such meeting shall be limited to those matters
specified in the notice of the meeting. Notice of any meeting shall be given to
all Members not less than ten (10) and not more than thirty (30) days prior to
the date of the meeting. Members may vote in person or by proxy at such meeting.

Except as otherwise expressly provided in this Agreement or
required by the express provisions of the Law, the vote of a Majority Interest
of the Members shall control all decisions for which the vote of the Members is
required hereunder. Each Member’s voting power shall be the same as that
Member’s Percentage Interest at the time of the vote. The presence of any Member
at a meeting shall constitute a waiver of notice of the meeting with respect to
such Member, unless such Member is present solely to challenge the validity of
the meeting. The Members may, at their election, participate in any regular or
special meeting by means of conference telephone or similar communications
equipment by means of which all Persons participating in the meeting can hear
each other. A Member’s participation in a meeting pursuant to the preceding
sentence shall constitute presence in person at such meeting for all purposes of
this Agreement. 

12.2 Vote By Proxy. Each Member may authorize any Person
to act on the Member’s behalf by proxy on all matters in which a Member is
entitled to participate, whether by waiving notice of any meeting, or voting or
participating at a meeting. Every proxy must be signed by the Member authorizing
such proxy or such Member’s attorney-in-fact. No proxy shall be valid after the
expiration of eleven (11) months after the date thereof unless otherwise
provided in the proxy. Every proxy shall be revocable by the Member executing
the same. 

12.3 Conduct of Meeting. Each meeting of Members shall
be conducted by the President or any Manager. The meeting shall be conducted
pursuant to such rules as may be adopted by the Board of Managers or the Person
conducting the meeting. 

12.4 Action Without a Meeting. Notwithstanding anything
to the contrary in this Agreement, any action that may be taken at a meeting of
the Members may be taken without a meeting if a consent in writing setting forth
the action so taken is approved by either a Majority Interest or a Required Interest, as
appropriate, which consent may be executed in multiple counterparts. In the
event any action is taken pursuant to this Section 12.4, it shall not be
necessary to comply with any notice or timing requirements set forth in Section
12.1. Prompt written notice of the taking of any action without a meeting shall
be given to the Members who have not consented in writing to such action. 

12.5 Closing of Transfer Record; Record Date. For the
purpose of determining the Members entitled to notice of or to vote at any
meeting of Members, any reconvening thereof, or to act by consent, the Board of
Managers may provide that the transfer record shall be closed for at least ten
(10) days immediately preceding such meeting (or such shorter time as may be
reasonable in light of the period of the notice) or the first solicitation of
consents in writing. If the transfer record is not closed and if no record date
is fixed for determining the Members entitled to notice of or to vote at a
meeting of Members or by consent, the date on which the notice of the meeting is
mailed or the first written consent is received by the Board of Managers shall
be the record date for such determination. 

ARTICLE XIII. 

INDEMNIFICATION AND INSURANCE 

13.1 Indemnification. To the fullest extent permitted by
law, the Company (but not the Members) will indemnify each Member, its
Affiliates, the directors, officers, employees and agents of each Member or its
Affiliates, and each Manager, officer, employee and agent of the Company (each
an “Indemnified Party” and collectively the “Indemnified Parties”), and save and
hold each Indemnified Party harmless, from and in respect of (i) all fees, costs
and expenses incurred in connection with or resulting from any claim, action or
demand against an Indemnified Party (including any claim, action or demand
arising under common law or statute), including attorneys’ fees, that arise out
of or in any way relate to the Company or its subsidiaries, or their respective
properties, business or affairs, or that arise by reason of any of them being a
Manager, director, officer, employee or agent of a Member or the Company
(provided, that, in such capacity, such Person was performing
services on behalf of the Company) or a director, officer, employee or agent of
any Affiliate of a Member (whether or not such Person continues to serve in such
capacity at the time such claim, action or demand is brought or threatened; and
provided, that, in such capacity, such Person was performing
services on behalf of the Company), (ii) all claims, actions and demands and any
resulting losses or damages (including all claims, actions and demands arising
under common law or statute), including amounts paid in settlement or compromise
of any claim, action or demand; provided, however, that this
indemnity will be available to an Indemnified Party only if such Indemnified
Party acted in good faith and in a manner he or she reasonably believed to be
in, or not opposed to, the best interests of the Company and, with respect to
any criminal action or proceeding, had no reasonable cause to believe his or her
conduct was unlawful, (iii) all fees, costs and expenses incurred in connection
with or resulting from any claim, action or demand against any Member (including
any claim, action or demand arising under common law or statute), including
attorneys’ fees, that arise out of or in any way relate to a breach of any non-competition agreement that
the Member may be a party to at the time this Agreement is signed, and (iv) all
fees, costs and expenses incurred in connection with or resulting from any
claim, action or demand against any Member (including any claim, action or
demand arising under common law or statute), including attorneys’ fees, for
tortious interference with any contract that such Member may be a party to at
the time this Agreement is signed. By signing this Agreement, the Indemnified
Party covenants that he or she has not attempted to induce any Member to violate
a non-competition agreement that the other Member may be a party to at the time
this Agreement is signed. The foregoing is intended to satisfy any requirements
of applicable law that indemnification be authorized prior to indemnifying any
Person. The foregoing right of indemnification will be in addition to any rights
to which the Indemnified Parties may otherwise be entitled under the Law or
otherwise and will inure to the benefit of the executors, administrators,
personal representatives, successors or assigns of each Indemnified Party. 

13.2 Expenses. The Company shall pay the expenses
incurred by an Indemnified Party in defending a civil or criminal action, suit
or proceeding, other than an action brought by the Company, upon receipt of an
undertaking by the Indemnified Party to repay payments made by the Company if
the Indemnified Party is determined not to be entitled to indemnification as
provided herein. The Board of Managers will have the power on behalf of the
Company to indemnify, on terms generally consistent with this Article XIII, any
other Person who serves at the request of a Member as a director, officer,
employee or agent of, an Affiliate of the Company or a Member or Manager,
against any liabilities that may be incurred by reason of the Person’s being an
officer, employee or agent of, an Affiliate of the Company or a Member or
Manager. Any right of indemnity granted under this Article XIII may be satisfied
only out of the assets of the Company and no Member will be personally liable
with respect to any claim for indemnification. 

13.3 Insurance. The Company shall purchase and maintain
insurance in reasonable amounts on behalf of the Company, as determined by the
Board of Managers, and the Indemnified Parties against any liability incurred by
them in their capacities as such, whether or not the Company has the power to
indemnify them against such liability. The Company may purchase and maintain
insurance for the protection of any Indemnified Party against similar
liabilities, whether or not the Company has the power to indemnify such Person
against such liabilities. 

13.4 No Third-Party Beneficiaries. The indemnification
provided in this Article XIII is for the benefit of the Indemnified Parties and
their respective executors, administrators, personal representatives, successors
and assigns, and shall not be deemed to create any right to indemnification for
any other Persons. 

13.5 Savings Clause. If all or any portion of this
Article XIII shall be invalidated on any ground by a court of competent
jurisdiction, then the Company shall nevertheless indemnify and hold harmless a
Person to be indemnified pursuant to this Article XIII as to costs, charges and
expenses (including attorneys’ fees), judgments, fines and amounts paid in settlement with respect to any
action, suit or proceeding, whether civil, criminal, administrative or
investigative, to the full extent permitted by any applicable portion of this
Article XIII that shall not have been invalidated and to the fullest extent
permitted by applicable law. 

ARTICLE XIV. 

TRANSFER OF INTERESTS AND SUBSTITUTE/ADDITIONAL
MEMBERS 

14.1 Transfers by Members. Except for a transfer
to the heirs of a Member upon the death of such Member, and except as otherwise
set forth in this Article XIV and in Article XV, a Member may not sell, assign,
transfer, pledge or hypothecate all or any part of his, her or its Interest
without the prior written consent of the Board of Managers. The Board of
Managers may withhold their consent to any transfer for which such consent is
required, with or without reasonable cause. If a Member receives the prior
consent of the Board of Managers he, she or it may sell his, her or its Interest
if the following conditions are satisfied or waived: 

(a) The sale, transfer or assignment, when aggregated with any
prior sales, transfers or assignments of Interests, would not result in (i) the
termination of the Company pursuant to section 708 of the Code, or (ii) the
Company being treated as a “publicly traded partnership” for Federal income tax
purposes; 

(b) The Member and his, her or its transferee execute,
acknowledge and deliver to the Board of Managers such instruments of transfer
and assignment with respect to such transaction as are in form and substance
satisfactory to the Board of Managers; 

(c) Unless waived in writing by the Board of Managers, the
Member delivers to the Board of Managers an opinion of counsel satisfactory to
the Board of Managers, covering such securities and tax laws (including the
inapplicability of subparagraph (a) of this Section 14.1) and other aspects of
the proposed transfer as the Board of Managers may reasonably request; and 

(d) The Member has furnished to the transferee a written
statement showing the name and taxpayer identification number of the Company in
such form and together with such other information as may be required under
section 6050K of the Code and the Regulations thereunder. 

Any Member who thereafter sells, assigns or otherwise transfers
all or any portion of his, her or its Interest shall promptly notify the Board
of Managers of such transfer and shall furnish to the Board of Managers the name
and address of the transferee and such other information as may be required
under section 6050K of the Code and the Regulations thereunder. 

14.2 Substitute Member. No Person taking or
acquiring, by whatever means, the Interest of any Member, shall be admitted as a
Substitute Member without the prior approval of the Board of Managers at the
time the proposed Transfer is being considered for approval. In addition, no
Person shall be admitted as a Substitute Member unless such Person: 

(a) Elects to become a Substitute Member by delivering notice
of such election to the Company; and 

(b) Executes, acknowledges and delivers to the Company such
other instruments as the Board of Managers may deem necessary or advisable to
effect the admission of such Person as a Substitute Member, including, without
limitation, the written acceptance and adoption by such Person of the provisions
of this Agreement. 

14.3 Basis Adjustment. Upon the Transfer of all or part
of an Interest, at the request of the transferee of the Interest, the Board of
Managers may, in its sole discretion, cause the Company to elect, pursuant to
section 754 of the Code or the corresponding provisions of subsequent law, to
adjust the basis of the Company properties as provided by sections 734 and 743
of the Code. 

14.4 Admission of Additional Members. The Board of
Managers with the approval of a Required Interest of the Members is authorized
to issue additional Interests in the Company and to admit additional Persons to
the Company as Additional Members, which in all instances shall comply with
applicable securities laws. The Board of Managers shall have discretion in
determining the consideration (which must be fully paid in cash or property at
the time of subscription), and the terms and conditions with respect to the
Company for admitting Additional Members. The Board of Managers will not permit
any Person to become an Additional Member unless such Person certifies in
writing to the Board of Managers that the Person agrees to be bound by the terms
of this Agreement. The Board of Managers shall do all things necessary to comply
with the Law and is authorized to do all things it deems to be necessary or
advisable in connection with the Company for admitting any Additional Member,
including, but not limited to, complying with any statute, rule, regulation or
guideline issued by any Federal, state or other governmental agency.

14.5 Transfer Procedures. The Board of Managers is
authorized to establish a transfer procedure consistent with this Article XIV to
ensure that all conditions precedent to the admission of a Substitute Member or
Additional Member have been complied with. 

14.6 Invalid Transfer. No Transfer of an Interest that
is in violation of this Article XIV shall be valid or effective, and the Company
shall not recognize any improper Transfer for the purposes of making
allocations, payments of profits, return of Capital Contributions or other
distributions with respect to such Interest, or part thereof. The Company may
enforce the provisions of this Article XIV either directly or indirectly or
through its agents by entering an appropriate stop transfer order on its books
or otherwise refusing to register or transfer or permit the
registration or transfer on its books of any proposed Transfers not in
accordance with this Article XIV. 

14.7 Distributions and Allocations in Respect of a
Transferred Interest. If any Member Transfers any part of his, her or its
Interest during any accounting period in compliance with the provisions of this
Article XIII, Company income, gain, deductions and losses attributable to such
Interest for the respective period shall be divided and allocated between the
transferor and the transferee by taking into account their varying interests
during the appropriate accounting period in accordance with Code section 706(d),
using the daily proration method. All Company distributions on or before the
effective date of such Transfer shall be made to the transferor, and all such
Company distributions thereafter shall be made to the transferee. Solely for
purposes of making Company tax allocations and distributions, the Company shall
recognize a Transfer on the day following the day of Transfer. Neither the
Company nor the Board of Managers shall incur any liability for making Company
allocations and distributions in accordance with the provisions of this Section
14.7, whether or not the Board of Managers or the Company have knowledge of any
Transfer of any Interest or part thereof where the transferee is not admitted as
a Substitute Member. 

14.8 Additional Requirements of Admission to Company. No
Transfer of an Interest shall be effective or valid and no Person shall be
admitted as a Member if such Transfer or admission would have the effect of
causing the Company to be re-classified for Federal income tax purposes as an
association (taxable as a corporation under the Code), or would violate any
Healthcare Law (or any rule or regulation thereunder), or would not meet
applicable exemptions from securities registration and securities disclosure
requirements provided under Federal and state securities laws. 

14.9 Amendment to Exhibit A. The Board of Managers shall
amend Exhibit A attached to this Agreement from time to time to reflect
the admission of any Substitute Member, or Additional Member, or the increase,
reduction or termination of any Member’s Interest, Units and Percentage
Interest. 

ARTICLE XV. 

LIQUIDATION OF INTERESTS 

15.1 Company’s Right of First Refusal. Subject to the
restrictions on transfer set forth in Article XIV, if any Member receives or
obtains an offer from a Person to acquire in any manner all or any part of his,
her or its Interest, which offer the Member intends to accept, the Member shall
promptly notify the Board of Managers in writing of the offer received,
including the name of the offeror, the Interest offered to be purchased, the
proposed purchase price and the other terms and conditions of the offer. The
Company shall have the option for a period of sixty (60) days from the day the
Board of Managers receive notice of such offer to exercise its right to purchase
such Member’s Interest on the same terms and conditions contained in the offer.
The Company may exercise its option by notifying the Member proposing to sell
prior to the end of such sixty (60) day period of its exercise of the option and shall
thereafter purchase such Member’s Interest within five (5) days following the
expiration of such sixty (60) day period (unless such exercise is subsequently
revoked). If the Company fails to, or indicates in writing that it will not,
exercise the option within the period provided, or if the Company exercises the
option but fails to effect the purchase within the prescribed five (5) day
period, the Member in accordance with and subject to the provisions of Article
XIV, may convey or dispose of the part of the Member’s Interest that was the
subject of the offer but only at the price, terms and conditions, and to the
party specified in the offer notice to the Board of Managers. If terms and
conditions more favorable to the proposed purchaser than, or in any material
manner different from, those offered to the Company should be agreed to by the
Member, the Company shall again have the option to purchase the selling Member’s
Interest which is subject to the more favorable or different purchase terms in
accordance with this Section 15.1. Neither the Board of Managers nor the Company
shall be liable or accountable to any Member which attempts to transfer his, her
or its Interest for any loss, damage, expense, cost, or liability resulting from
the Company’s exercise or failure to exercise the purchase option under this
Section 15.1, delay in notifying the Member of the Company’s intention not to
exercise the purchase option, or its enforcement of the requirements of this
Section 15.1 in the event that it elects not to exercise the purchase option.
The Company’s failure to exercise the purchase option or to indicate in writing
that it is electing not to exercise the option shall not be deemed a consent to
allow any third party transferee to become a Substitute Member, such consent
being controlled by the provisions of Section 14.2.

15.2 Occurrence of Terminating Event or Adverse Terminating
Event.

(a) In the event a Terminating Event shall occur with respect
to any Physician Class A Member or Physician Class C Member (which, for purposes
of this Article XV, includes any Physician who owns or controls a Physician
Class A Member or Physician Class C Member which is an entity), such Physician
Class A Member or Physician Class C Member or the Member’s successor or other
legal representative shall give written notice thereof to the Company within
thirty (30) days of the occurrence of such Terminating Event. Except as
otherwise provided herein, upon the receipt of such notice, the Company shall
have the right, but not the obligation, for the ensuing sixty (60) days to
exercise its right to purchase such Physician Class A Member’s or Physician
Class C Member’s Units. If the Company has not received written notice of a
Terminating Event with respect to any Member as required under this Section
15.2(a), the Company will have the right to exercise its right to purchase such
Physician Class A Member’s or Physician Class C Member’s Units for sixty (60)
days after the Board of Managers has actual knowledge of the occurrence of any
such event and gives written notice thereof to the Physician Class A Member or
Physician Class C Member or Member’s successor or other legal representative.
Notwithstanding anything to the contrary in this Agreement, the failure of a
Physician Class A Member or Physician Class C Member to notify the Company of
the occurrence of a Terminating Event as required under this Section 15.2(a)
shall not constitute the occurrence of an Adverse Terminating Event. In the event the Company elects to purchase the Units of a Physician
Class A Member or Physician Class C Member pursuant to this Section 15.2(a), the
Company shall consummate such purchase within the five (5) day period following
the expiration of the sixty (60) day exercise period (unless such exercise is
subsequently revoked) pursuant to the terms set forth in Sections 15.3(a) and
(c). 

(b) In the event the Board of Managers and a Required Interest
of Members determines that an Adverse Terminating Event has occurred with
respect to any Class A Member or Class C Member (which, for purposes of
this Article XV, includes any Physician who owns or controls a Physician Class
A Member or Physician Class C Member which is an entity), (i) the Company
shall give written notice thereof to such Physician Class A Member or
Physician Class C Member, and (ii) such Physician Class A Member or Physician
Class C Member shall cease to be a Member and shall be deemed to have
immediately withdrawn from the Company as of the date that the Board of Managers
and a Required Interest of Members determined that such Adverse Terminating
Event had occurred with respect to such Physician Class A Member or Physician
Class C Member. Within sixty (60) days after the date of such Adverse
Terminating Event, the Company shall purchase such former Physician Class A
Member’s or former Class C Member’s Units pursuant to the terms set forth in
Sections 15.3(b) and (c). 

15.3 Payment for Interest. 

(a) If any Physician Class A Member’s or Physician Class C
Member’s Units are purchased because of the occurrence of a Terminating Event,
the amount the Company will pay for the Units owned by such Member shall be
equal to the Fair Market Value Price as of the day on which the sixty (60) day
exercise period began to run. 

(b) If the Company purchases any former Physician Class A
Member’s or Physician Class C Member’s Units as a result of an Adverse
Terminating Event, the amount to be paid by the Company to such former Physician
Class A Member or Physician Class C Member shall be equal to the greater
of (i) the Investment Price or (ii) $100.00 per Class A Unit or Class C
Unit, as applicable.

(c) If the Company purchases any Physician Class A Member’s or
Physician Class C Member’s Units as provided in this Section 15.3, the Company
shall pay any such amounts owed therefor to such Member or his, her or its
successor in interest in a lump sum or, at the discretion of the Board of
Managers, in up to twenty-four (24) equal monthly payments, with interest
accruing at the Prime Rate on the unpaid principal balance. If the Board of
Managers exercises its discretion to pay for Units in monthly installments, the
first such installment will be paid to the Physician Class A Member or Physician
Class C Member, or his, her or its successor in interest on the first day of the
month after thirty (30) days have expired since the Physician Class A Member’s or
Physician Class C Member’s Units have been purchased. Each subsequent
installment shall be paid on the first day of each successive month until the
full amount owed to the Physician Class A Member or Physician Class C Member, or
his, her or its successor in interest has been paid. The Company’s obligation to
pay the Physician Class A Member or Physician Class C Member, in monthly
installments under this Section 15.3 will be evidenced by a nonrecourse
promissory note executed by the Company.

15.4 Subsequent Legislation. If the Board of Managers in
its reasonable discretion determines that any Member is prohibited from owning
an interest in the Company as a result of the enactment of any statute,
regulation or other law or the judicial or administrative interpretation of any
existing or future statute, regulation or other law, the Board of Managers shall
attempt to restructure the Company in order to comply with such enactment or
interpretation. If the Company cannot be so restructured, the Board of Managers
will dissolve the Company and liquidate all the Member’s Interests as provided
in Article XVI.

15.5 Involuntary Transfers. In the case of any transfer
of title or beneficial ownership of all or any part of an Interest upon default,
foreclosure, forfeit, court order, or otherwise than by a voluntary decision on
the part of the Member (an “Involuntary Transfer”), the Company shall have the
right to purchase such Interest pursuant to this Section 15.5. Upon the
Involuntary Transfer of all or any part of an Interest of any Member, such
Member shall promptly (but in no event later than five (5) days after such
Involuntary Transfer) furnish written notice to the Company indicating that the
Involuntary Transfer has occurred, specifying the name of the Person to whom
such Interest (or portion thereof) has been transferred (the “Involuntary
Transferee”), giving a detailed description of the circumstances giving rise to,
and stating the legal basis for, the Involuntary Transfer. Upon the receipt of
such notice the Company shall have the exclusive right, but not the obligation,
within sixty (60) days to elect to purchase, and the Involuntary Transferee
shall have the obligation to sell, all (but not less than all) of the Interest
acquired by the Involuntary Transferee to the Company. If an Interest (or any
portion thereof) is purchased pursuant to this Section 15.5, the purchase price
shall be fifty percent (50%) of the Fair Market Value Price as of the date on
which the Involuntary Transfer of such Interest became effective. The purchase
price shall be payable in forty-eight (48) equal monthly installments of
principal plus accrued interest at the Prime Rate, which installments shall be
evidenced by an unsecured, nonrecourse promissory note.

15.6 Required Repurchase of Interest. At any time after
the occurrence of a Terminating Event with respect to a Physician Class A Member
or Physician Class C Member (other than the dissolution, liquidation, or
revocation of the charter of a Physician Class A Member or Physician Class C
Member that is an entity), such Physician Class A Member or Physician Class C
Member or his, her or its successor in interest may require the Company to
purchase his, her, or its Units. A Physician Class A Member or Physician Class C
Member or his, her or its successor in interest may exercise his, her, or its right to require the Company to
repurchase his, her, or its Units by giving written notice to the Company within
sixty (60) days of the Terminating Event. The purchase price for such Units
shall be the Fair Market Value Price as of the date of receipt by the Company of
the notice of redemption. If the Company purchases any Physician Class A
Member’s or Physician Class C Member’s Units as provided in this Section 15.6,
the Company shall pay any such amounts owed therefor to such Member or his, her
or its successor in a lump sum or, at the discretion of the Board of Managers,
in up to twenty-four (24) equal monthly payments, with interest accruing at the
Prime Rate on the unpaid principal balance. If the Board of Managers exercises
its discretion to pay for Units in monthly installments, the first such
installment will be paid to the Member or his, her or its successor in interest
on the first day of the month after thirty (30) days have expired since the
Physician Class A Member’s or Physician Class C Member’s Units has been
purchased. Each subsequent installment shall be paid on the first day of each
successive month until the full amount owed to the Physician Class A Member or
Physician Class C Member or his, her or its successor in interest has been paid.
The Company’s obligation to pay the Physician Class A Member or Physician Class
C Member in monthly installments under this Section 15.6 will be evidenced by an
unsecured, nonrecourse promissory note executed by the Company.

If the Company cannot repurchase the Units noticed for
repurchase hereunder, because the Company lacks sufficient cash or the Company
is limited for legal reasons or because the exercise of such repurchase would
cause the Company to be treated as a publicly traded partnership for tax
purposes, in each case as determined by the Board of Managers, then the Company
shall repurchase the maximum portion of such Units as possible, such repurchases
to be allocated pro rata among the Members who have so tendered Units. If the
Company is unable to repurchase any such Units, the obligation of the Company to
make such repurchase in that particular year shall terminate, and thereafter the
Board of Managers shall repurchase all remaining Units, subject to the Board of
Managers having sufficient cash, not being limited for legal reasons from making
such purchase and the repurchase not causing the Company to be classified as a
publicly traded partnership for tax purposes, in each case as determined by the
Board of Managers, and subject to the same pro rata allocation as referenced
above if the Board of Managers is able to purchase some but not all remaining
Units who holds such Units may exercise his, her, or its right in the following
year, subject to the same limitations. If a natural disaster or other event
occurs that has a material adverse effect on the operations of the Company (as
determined by the Board of Managers in its sole discretion), the Company’s
obligation to repurchase Units shall be suspended until repairs have been
completed or the operations stabilized, as applicable. 

15.7 Limitation on Repurchase Payments. Notwithstanding
anything contained in this Article XV to the contrary, in no event shall the
Company be obligated to pay in any calendar quarter an aggregate amount which
exceeds twenty percent (20%) of the Company’s EBITDA during such calendar
quarter (the “Repurchase Cap”) to former Physician Class A Members, former
Physician Class C Members, Involuntary Transferees of Members and/or their
respective legal representatives or successors in interest in connection with
the repurchase of their Units. If in any calendar quarter the Company is scheduled to make payments to former Physician Class
A Members, former Physician Class C Members, Involuntary Transferees of Members,
and/or their respective legal representatives or successors in interest that
would in the aggregate exceed the Repurchase Cap, then the Company shall pay the
maximum amount possible without exceeding the Repurchase Cap in the following
order of priority: 

(a) First, among the former Physician Class A Members,
former Physician Class C Members, Involuntary Transferees of Member and their
respective legal representatives or successors in interest who are entitled to
payments as a result of (i) the occurrence of a Terminating Event, (ii) the
redemption of Units under Section 15.4, or (iii) the exercise of the “put” right
set forth in Section 15.6; 

(b) Second, among Involuntary Transferees of Members who
are entitled to payments as a result of the purchase of Units under Section
15.5; and

(c) Third, proportionately among the former Physician
Class A Members, former Physician Class C Members, Involuntary Transferees of
Members and their respective legal representatives or successors in interest who
are entitled to payments as a result of the occurrence of an Adverse Terminating
Event. 

If the Company is unable in any calendar quarter to pay the
full amount due to former Members, Involuntary Transferees of Members and/or
their respective legal representatives or successors in interest as a result of
the Repurchase Cap, then the Board of Managers, in its sole discretion, may
cause the Company to pay any past-due amounts in one or more subsequent calendar
quarters; provided, that, the payment of such additional amounts would
not cause the Repurchase Cap for any subsequent calendar quarter to be exceeded;
and provided further, that, all such unpaid amounts shall
bear interest at the Prime Rate. 

15.8 Federal Income Tax Treatment. In the event the
Company exercises the right to purchase any Member’s or former Member’s Units
under this Article XV, one hundred percent (100%) of all payments made by the
Company to such Person hereunder in consideration for such Person’s Units will,
for Federal income tax purposes, be classified as a Code section 736(b) payment
except for such Person’s share of the Company’s “unrealized receivables,” as
defined in Code section 751(c) which will be classified as a Code section
736(a)(1) payment. The Board of Managers shall conclusively determine or cause
to be determined any such Person’s share of “unrealized receivables.” The
Company shall be liable to any Person for any inaccuracy in determining any
Person’s share of the Company’s “unrealized receivables.”

15.9 Waiver of Rights to Object. All Members acknowledge
that the methods provided for in this Article XV and Section 1.1 for determining
the Fair Market Value Price, Investment Price, or other price of an Interest to
be purchased hereunder are fair as to dates used, notices, terms and in all
other respects, and are administratively and in substance superior to other methods. Each Member waives any
right that he, she or it may have to use any other method to determine the value
of any interest in the Company in connection with the application of this
Article XV. 

15.10 Release of Personal Guarantees. Notwithstanding
any other provision contained in this Article XV, all transfers, assignments and
withdrawals permitted pursuant to this Article XV shall be contingent upon the
transferring, assigning or withdrawing Member being fully released from any and
all personal guarantee(s) provided by such Member or Affiliate thereof, by both
the Company and the applicable financial or lending institution.

ARTICLE XVI. 

LIQUIDATION AND DISSOLUTION OF THE COMPANY

16.1 Dissolution Events. The Company will be dissolved
upon the happening of any of the following events: 

(a) All or substantially all of the assets of the Company are
sold or distributed to the Members; 

(b) A document is signed by a Required Interest of the Members
which states their election to dissolve the Company; or 

(c) The entry of a final judgment, order or decree of a court
of competent jurisdiction adjudicating the Company to be bankrupt and the
expiration without appeal of the period, if any, allowed by applicable law in
which to appeal. 

16.2 Method of Liquidation. 

(a) Generally. Upon the happening of any of the events
specified in Section 16.1 hereof the Board of Managers or any liquidating
trustee elected by the Members holding at least a Required Interest, will
commence as promptly as practicable, wind up the Company’s affairs as promptly
as practicable, unless the Board of Managers or the liquidating trustee (either,
the “Liquidator”) determines that an immediate liquidation of Company assets
would cause undue loss to the Company, in which event the liquidation may be
deferred for a time determined by the Liquidator to be appropriate. Assets of
the Company may be liquidated or distributed in kind, as the Liquidator
determines to be appropriate. The Members will continue to share Profits and
Losses and Available Cash during the period of liquidation in the manner set
forth in Article VI and Article VII of this Agreement. 

(b) Distribution of Liquidation Proceeds. The proceeds
from liquidation of the Company, including repayment of any debts of Members to
the Company, and any Company assets that are not sold in connection
with the liquidation will be applied in the following order of priority: 

(i) First, to payment of the debts and satisfaction of the
other obligations of the Company, including without limitation debts and
obligations to Members; 

(ii) Second, to the establishment of any reserves deemed
appropriate by the Liquidator for any liabilities or obligations of the Company,
which reserves will be held for the purpose of paying liabilities or obligations
and, after the expiration of a period the Liquidator deems appropriate, will be
distributed to the Members in proportion to their respective Percentage
Interests; and 

(iii) Third, to the Members in proportion to their respective
Percentage Interests. 

Upon liquidation, prior to making any liquidating distributions
hereunder, the Liquidator is hereby authorized and directed to make any and all
special allocations of Profits, Losses and items of Company gain and deduction
in a manner which results in the Members’ respective Capital Accounts having
balances equal to (or as close thereto as possible) the aggregate liquidating
distribution that each such Member shall receive hereunder. 

If the Company makes distributions in kind of Company property
which secures indebtedness, each of the Members receiving the distribution of
property subject to the indebtedness will be severally liable (as among each
other, not for the benefit of others) for his, her or its Proportionate Share of
the indebtedness, provided, that no Member will be deemed to have
assumed any liability on any indebtedness secured by property distributed to any
Member for which the Member is not liable under the terms of the instrument
creating the indebtedness, and provided that the liability of each Member to
other Members for indebtedness secured by property distributed to him, her or it
will be limited to the value of his, her or its interest in the property.
Indebtedness secured by property distributed to Members in kind need not be
discharged out of the proceeds of liquidation of the Company. 

(c) Compliance with Timing Requirements of Treasury
Regulations. If the Company is “liquidated” within the meaning of Treasury
Regulations Section 1.704 -1(b)(2)(ii)(g), and a Member is indebted to the
Company, that Member will pay the indebtedness in accordance with the provisions
of this Agreement. In the discretion of the Board of Managers, a pro rata
portion of the distributions that would otherwise be made to the Members under
the preceding sentence may be applied as follows:

(i) The distributions may be distributed to a trust established
for the benefit of the Members for the purposes of liquidating Company assets, collecting amounts owed to the Company, and paying any
contingent or unforeseen liabilities or obligations of the Company arising out
of or in connection with the Company. The assets of any trust established under
this Section 16.2(c)(i) will be distributed to the Members from time to time, in
the reasonable discretion of the Board of Managers, in the same proportions as
the amount distributed to the trust by the Company would otherwise have been
distributed to the Members under this Agreement; or 

(ii) Withheld to provide a reasonable reserve for Company
liabilities (contingent or otherwise) and to reflect the unrealized portion of
any installment obligations owed to the Company. The withheld amounts will be
distributed to the Members as soon as practicable. 

16.3 Member’s Deficit Capital Account. If any Member has
a deficit balance in his, her or its Capital Account (after giving effect to all
contributions, distributions, and allocations for all taxable years, including
the year during which such liquidation occurs), such Member will have no
obligation to make any contribution to the capital of the Company with respect
to such deficit, and such deficit will not be considered a debt owed to the
Company or any other Person for any purpose whatsoever. 

16.4 Liquidator Appointed by Court. If within thirty
(30) days following the date of dissolution, or other time period provided in
Section 16.2, a Liquidator has not been appointed in the manner provided
therein, any Member shall have the right to make application to the appropriate
court in the jurisdiction in which the Company is located for appointment of
such Liquidator, and the said court shall be fully authorized to appoint and
designate such Liquidator who shall have all the powers, duties, rights and
authorities of the Liquidator herein provided. 

16.5 Date of Termination. The Company will terminate
when all of the cash and property available for application under Section 16.2
above have been applied in accordance with Section 16.2. The establishment of
any reserves in accordance with the provisions of Section 16.2(c)(ii) will not
extend the term of the Company, but any reserve will be distributed in the
manner provided in Section 16.2(b) upon expiration of the period established for
the reserve. 

16.6 Death, Dissolution, Legal Incompetency or Bankruptcy of
a Member. The death, dissolution, declaration of legal incompetence or
Bankruptcy of a Member will not dissolve the Company. The deceased, dissolved,
incompetent or Bankrupt Member’s Interest will pass to a successor in interest
of the Member, who will succeed to the deceased, dissolved, incompetent or
Bankrupt Member’s entire interest in the Company and, subject to the applicable
provisions of Article XIV of this Agreement, and the Company’s purchase rights
under Article XV of this Agreement, will become a Member of the Company with the
same Percentage Interest, the same rights to distributions made by the Company,
the same obligations and the same share of the Company’s Profits and Losses as
the deceased, dissolved, incompetent or Bankrupt Member. 

16.7 Liquidator’s Powers. The Liquidator appointed in
the manner provided herein shall have without further authorization or consent
of any of the parties hereto or their legal successors in interest, all of the
powers conferred upon the Board of Managers under the terms of this Agreement
(but subject to all of the applicable limitations, contractual and otherwise,
upon the exercise of such powers to the extent necessary or desirable in the
good faith judgment of the Liquidator) to carry out the duties and functions of
the Liquidator hereunder for and during such period of time, not to exceed two
(2) years after the date of dissolution of the Company, as shall be reasonably
required in the good faith judgment of the Liquidator to complete the
liquidation and dissolution of the Company as provided for herein including,
without limitation, the following specific powers: 

(i) The power to continue to manage and operate any business of
the Company during the period of such liquidation or dissolution proceedings,
excluding however, the power to make and enter into contracts which may extend
beyond the period of liquidation; 

(ii) The power to make sales and incident thereto to make
deeds, bills of sale, assignments and transfers of assets and properties of the
Company; provided, that the Liquidator may not impose personal
liability upon any of the Members under any such instrument; 

(iii) The power to borrow funds as may, in the good faith
judgment of the Liquidator, be reasonably required to pay debts and obligations
of the Company or operating expenses, and to execute and/or grant deeds of
trust, mortgages, security agreements, pledges and collateral assignments upon
and encumbering any of the Company properties as security for repayment of such
loans or as security for payment of any other indebtedness of the Company;
provided, however, that the Liquidator shall not have the power to
create any personal obligation on any of the Members to repay such loans or
indebtedness other than out of available proceeds of foreclosure or sale of the
properties or assets as to which a lien or liens are granted as security for
payment thereof; and 

(iv) The power to settle, release, compromise or adjust any
claims asserted to be owing by or to the Company, and the right to file,
prosecute or defend lawsuits and legal proceedings in connection with any such
matter.

ARTICLE XVII. 

COMPLIANCE WITH LEGAL REQUIREMENTS 

17.1 General Compliance. The Members enter into this
Agreement with the intent of conducting their relationship in full compliance
with applicable state, local and Federal law, including but not limited to the
Healthcare Laws. Notwithstanding any unanticipated effect of any of the provisions of this
Agreement, no Member or any other Person acting on behalf of the Company will
intentionally conduct himself, herself or itself under the terms of this
Agreement in a manner that would constitute a violation of the Healthcare Laws.
Except as required to be affirmed in the Eligibility Affirmation Statement,
nothing contained in this Agreement shall require (directly or indirectly,
explicitly or implicitly) any Member to refer or direct any patients or other
business to the Company, the Surgery Center, or any Member or direct or indirect
owner of a Member, or to use the Surgery Center or the facilities of any Member
or direct or indirect owner of a Member as a precondition to receiving the
benefits set forth in this Agreement or distributions under this Agreement. The
Members will perform their obligations under this Agreement in accordance with
the terms hereof. Any agreements between the Company and any Member or direct or
indirect owner of a Member will be in writing, and the parties to any such
agreement will perform their obligations under such agreement only in accordance
with the terms thereof. 

17.2 Corporate Practice of Medicine. Nothing contained
in this Agreement is intended to (i) constitute the use of a medical license for
the practice of medicine by anyone other than a licensed physician; (ii) aid the
Company or any other entity in the practice of medicine when in fact the entity
is not authorized to practice medicine; or (iii) do any other act or create any
other arrangements in violation of the Texas Medical Practice Act. 

17.3 Reformation upon Change in or Violation of Laws.

(a) Reformation. In the event that subsequent to the
date of this Agreement (i) the contents or validity of this Agreement or the
operations of the Company or the Surgery Center are challenged by any
Governmental Authority under applicable law, particularly a Healthcare Law or
Federal tax law, or (ii) the Board of Managers determines, based upon advice
received from legal counsel, that a violation of a law, particularly a
Healthcare Law or Federal tax law, has occurred as a result of this Agreement or
the operations of the Company or the Surgery Center, or that a violation of a
law, particularly a Healthcare Law or Federal tax law, will occur as a result of
this Agreement or the operations of the Company or the Surgery Center, which
violation would result in material adverse consequences to the Members or the
Company, then the Board of Managers shall promptly notify all of the Members
with respect thereto. The Board of Managers shall promptly use reasonable
efforts to analyze, revise, reform and, to the extent necessary, restructure
this Agreement, the relationship among the Members and/or the operations of the
Company and/or the Surgery Center in order to fully comply with applicable law
in a manner that is equitable to all Members in light of the intent of the
Members regarding the operations of the Company and the Surgery Center as
contemplated by this Agreement. The Board of Managers shall recommend its
reformation plan for accomplishing the desired results to the Members for
approval. Any reformation plan proposed by the Board of Managers must be
approved by the affirmative vote of a Required Interest of the Members. 

(b) Failure to Reform. In the event the Board of
Managers is unable to formulate a plan to revise, reform and restructure this
Agreement and the operations of the Company and/or the Surgery Center in order
to fully comply with all applicable laws or the reformation plan fails to
receive the necessary affirmative vote of the Members, the Board of Managers
shall, at its sole discretion, either carry out its rights and obligations under
Section 15.4 of this Agreement or cause the Company to dissolve under Article
XVI of this Agreement. 

ARTICLE XVIII. 

POWER OF ATTORNEY 

18.1 President as Attorney-in-Fact. Except as set forth
below, each Member hereby makes, constitutes, and appoints the President of the
Company, with full power of substitution and resubstitution, his, her or its
true and lawful attorney-in-fact and in his, her or its name, place, and stead
and for his, her or its use and benefit to sign, execute, certify, acknowledge,
swear to, file, and record (a) this Agreement and all agreements, certificates,
instruments, and other documents amending or changing this Agreement, as now or
hereafter amended, which the President may deem necessary, desirable, or
appropriate including, without limitation, to reflect (i) the valid exercise by
the Board of Managers of any power granted to them under this Agreement; (ii)
any amendments adopted by the Members in accordance with the terms of this
Agreement; (iii) the valid admission of any Substitute Member or Additional
Member to the Company; or (iv) the valid disposition by any Member of his, her
or its Interest; and (b) any certificates, instruments, or documents as may be
required by, or may be appropriate under, the laws of the State of Texas.

18.2 Nature of Special Power. The power of attorney
granted pursuant to this Article XVIII: 

(a) is a special power of attorney coupled with an interest and
is irrevocable; 

(b) may be exercised by any such attorney-in-fact by listing
the Members executing any agreement, certificate, instrument, or other document
with the single signature of any such attorney-in-fact acting as
attorney-in-fact for such Members; and 

(c) shall survive the death, disability, legal incapacity,
bankruptcy, insolvency, dissolution, or cessation of existence of a Member and
shall survive the delivery of an assignment by a Member of the whole or a
portion of his, her or its Interest, except that where the assignment is of such
Member’s entire Interest and the assignee, with the consent of the Managers, is
admitted as a Substitute Member, the power of attorney shall survive the
delivery of such assignment for the sole purpose of enabling any such
attorney-in-fact to effect such substitution. 

ARTICLE XIX. 

ALTERNATIVE DISPUTE RESOLUTION 

19.1 Agreement to Use ADR. The Members have entered into
this Agreement in good faith and in the belief that it is mutually advantageous
to them. It is with that same spirit of cooperation that they pledge to attempt
to resolve any dispute amicably without the necessity of litigation. Subject to
the right of the Company to seek injunctive relief for any breach or threatened
breach of this Agreement by a Member, the Members agree if any dispute, claim,
or controversy arises between or among them, including any dispute between a
Member(s) and the Company, relating to the affairs of the Company or the
application of this Agreement whether in contract, tort, equity, or otherwise
(the “Dispute”), the alternative dispute resolution procedures specified in this
Article (the “ADR”) will be used to resolve such Dispute. 

19.2 Initiation of ADR. The Person seeking to initiate
ADR (the “Initiating Person”) must give written notice to the other Person(s)
involved in the Dispute. The notice must describe in general terms the nature of
the Dispute, the Initiating Person’s claim for relief and identify one (1) or
more individual(s) with authority to settle the Dispute on such Initiating
Person’s behalf. The Person(s) receiving such notice (the “Responding Person,”
whether one (1) or more) will have fifteen (15) days within which to designate
by written notice to the Initiating Person, one (1) or more individual(s) with
authority to settle the Dispute on the Responding Person’s behalf. The
individual(s) so designated, whether by the Initiating Person or the Responding
Person, will be known as the “Authorized Individuals,” whether one (1) or more.
The Initiating Person and the Responding Person will collectively be referred to
as the “Disputing Persons” or individually as the “Disputing Person.” If either
the Initiating Person or the Responding Person fails to name an Authorized
Individual as set forth above, then such Person will serve as its own Authorized
Individual, unless otherwise agreed by the Disputing Persons in writing;
provided that if such Person is not an individual, then the individual with
decision-making authority over the Person will serve as the Person’s Authorized
Individual. Under this Agreement, ADR has two (2) phases during which a
resolution of the Dispute may occur: (1) direct negotiations, and (2)
arbitration. 

19.3 Direct Negotiations. The Authorized Individuals may
investigate the Dispute as they deem appropriate; however, they must agree to
promptly, and in no event later than thirty (30) days from the date of the
Initiating Person’s written notice, meet to discuss the resolution of the
Dispute. The Authorized Individuals will meet at such times and places and with
such frequency as they may agree. If the Dispute has not been resolved within
thirty (30) days from the date of their initial meeting, the Disputing Persons
must submit the Dispute to arbitration in accordance with the procedure set
forth in Section 19.4. 

19.4 Arbitration. 

(a) Initiation. Arbitration will be initiated by written
notice from the Initiating Person to the Responding Person setting forth a
demand for arbitration after the termination of the direct negotiations between
the Disputing Persons contemplated by Section 19.3. The date of such notice is
the “Arbitration Submission Date.” 

(b) Qualifications of Tribunal. The arbitration will be
presided over by a panel of one (1) to three (3) arbitrators (collectively, the
“Tribunal.”) Each arbitrator will, insofar as is practicable, be a Person who is
expert in the subject matter of the dispute, who is neutral with respect to the
Dispute and who has served as arbitrator in a minimum of ten (10) cases. The
Tribunal shall be chosen pursuant to the commercial arbitration rules of the
American Arbitration Association (or any like organization successor thereto)
(the “AAA”). If the amount in controversy of the claim or any counterclaim is
One Million Dollars ($1,000,000.00) or more, the Tribunal shall consist of a
panel of three (3) arbitrators unless the Disputing Persons agree otherwise in
writing. If the amount in controversy of the claim or any counterclaim is less
than One Million Dollars ($1,000,000.00) the Tribunal shall consist of one (1)
arbitrator unless the Disputing Persons agree otherwise in writing. 

(c) Rules.

(1) Arbitration proceedings to resolve Disputes will be
conducted under the auspices and the commercial arbitration rules of the AAA
pursuant to the Federal Arbitration Rules of the AAA at Dallas County, Texas.
Whether such Dispute will be subject to arbitration will likewise be determined
in such arbitration as will the determination as to whether all procedural
conditions precedent to arbitration have been satisfied. If Title 9 of the
United States Code is inapplicable to the Dispute for any reason, such
arbitration must be conducted pursuant to the Texas General Arbitration Act
(i.e., Chapter 171 of the Texas Civil Practice & Remedies Code) and in
accordance with this Article XIX and the commercial arbitration rules of the
AAA. Such arbitration proceeding must be conducted in as expedited a manner as
is then permitted by the commercial arbitration rules (formal or informal) of
the AAA. Both the foregoing agreement of the Disputing Persons to arbitrate any
and all disputes and the results, determinations, finding, judgments and/or
awards rendered through any such arbitration will be final and binding on the
Disputing Persons and may be specifically enforced by legal proceedings. 

(2) The Tribunal may require and facilitate such discovery as
it shall determine is appropriate in the circumstances, taking into account the
needs of the Disputing Persons and the desirability of making discovery
expeditious and cost-effective. The Tribunal may issue orders to protect the confidentiality of proprietary information, trade secrets
and other sensitive information disclosed in discovery. Furthermore, each
Disputing Person will produce within forty-five (45) days of the selection or
appointment of the Tribunal all documents it intends to rely upon or may rely
upon in the arbitration. 

(3) Prior to rendering its determination or award, the Tribunal
must afford each Disputing Person an opportunity to express its views as to the
proper determination of the matters under arbitration, orally or in writing as
the Tribunal may deem appropriate; provided, however, that (a) a
Disputing Person submitting written material will be required to submit a copy
of that material to the other Disputing Person who will have the opportunity to
submit a written reply to that material within ten (10) days, and (b) if either
Disputing Person is to submit oral statements, the other Disputing Person must
be afforded a reasonable opportunity to be present at the time at which these
oral statements are made before the Tribunal and to reply orally.

(4) The Tribunal may, at its discretion and at the expense of
the Disputing Persons who will bear the cost of the arbitration, employ one or
more neutral expert(s) to assist it in its determination of the Dispute. 

(5) Time is of the essence of this arbitration procedure, and
the Tribunal will be instructed and required to render its decision within
thirty (30) days following completion of the arbitration. 

(d) Costs of Arbitration. The cost of said Tribunal and
the arbitration will be borne by the non-prevailing Disputing Persons, or as
otherwise allocated between the Disputing Persons by the Tribunal.
Notwithstanding the foregoing, the Disputing Persons will each bear separately
the cost of his, her or its respective attorneys, witnesses, representatives,
and experts in connection with such arbitration. 

(e) Indemnification of Tribunal. The Members and the
Company hereby agree to indemnify the Tribunal and any experts employed by the
Tribunal and to hold them harmless from and against any claim or demand arising
out of any arbitration under this Agreement unless resulting from the gross
negligence or willful misconduct of the Person to be indemnified. 

19.5 Governing Law and Venue. Any and all legal
proceedings to enforce this Article XIX (including any action to compel
arbitration hereunder or to enforce any award or judgment rendered therein) will
be governed by the laws of the State of Texas, excluding any conflicts-of-law
rule or principle that might refer the governance or the construction of this
Agreement to the law of another jurisdiction. Venue of any proceedings hereunder
will be in Dallas County, Texas, unless another location is mutually agreed on
by the Disputing Persons in writing. 

19.6 Statute of Limitations. Any Dispute shall be
time-barred unless the Initiating Person commences an arbitration proceeding
under this Article XIX with respect to such Dispute within one (1) year after
the Dispute arose. This time limit shall be tolled for the time period beginning
with the receipt of written notice to initiate ADR under Section 19.2 and ending
five (5) days following termination of mediation under the terms of this Article
XIX; provided, that, during such period the Disputing Persons were
engaged in the ADR procedure pursuant to the provisions of this Article XIX.

19.7 Confidentiality. The Members agree that ADR is a
compromise negotiation and further assert that the entire ADR procedure under
this Article XIX is confidential. No stenographic, visual or audio record may be
made without the written consent of the Disputing Persons. All conduct,
statements, promises, offers, views and opinions, whether oral or written, made
in the course of the ADR by any Disputing Persons, their agents, employees,
representatives or other invitees and by the arbitrator are confidential and
will, in addition and where appropriate, be deemed privileged. Such conduct,
statements, promises, offers, views and opinions will not be discoverable or
admissible for any purpose, including impeachment, in any litigation or other
proceeding involving the Disputing Persons and will not be disclosed to anyone
not an agent, employee, expert, witness, or representative of any of the
Disputing Persons except to the extent such disclosure is necessary to enforce
an arbitration award; provided, however, evidence otherwise
discoverable or admissible is not excluded from discovery or admission as a
result of its use in the ADR procedure. 

19.8 Waiver of Jury Trial. The Members do hereby waive
their right to trial by jury with respect to any dispute, and they agree that
Dallas County, Texas, will be the venue for any litigation arising under this
Agreement in the event that the referenced ADR procedures described in this
Article XIX are declared unenforceable by a court of competent jurisdiction. The
agreements contained in this Section 19.8 will remain in effect in the event the
referenced ADR procedures described in this Article XIX are declared
unenforceable by a court of competent jurisdiction. 

19.9 Survival. This Article XIX will survive the
termination of this Agreement. 

19.10 Additional Persons. The Members agree that any ADR
procedure arising out of or relating to this Agreement will include, by
consolidation, joinder or in any other manner, any additional Person not a
Member if: (i) a Member requests the addition of such Person; and (ii) the
requesting Member reasonably believes the addition of such Person to be
necessary to the resolution of the Dispute; and (iii) the additional Person is a
party to a contract with the requesting Member, which contract contains the
agreement of such additional Person to be bound by the ADR procedures set forth
in this Agreement. 

19.11 Exclusive Remedy/Attorneys’ Fees. The Members
agree that the ADR procedure as set forth in this Article XIX will be the sole
means of resolving any Dispute and expressly waive their right to file a lawsuit
in any civil court against one another or the Company for such Disputes, except to compel arbitration
hereunder or to enforce an arbitration decision rendered pursuant to this
Agreement and except for the rights to seek injunctive relief as described in
Section 19.1. If any Member or the Company brings an action against another
Member or the Company by reason of any alleged breach of a provision or
condition hereof, or to compel the ADR procedure pursuant to this Article, to
confirm or vacate an arbitration judgment or award, or to enforce the same, or
otherwise arising out of this Agreement, the unsuccessful Person must pay to the
prevailing Person all attorneys’ fees and costs actually incurred by the
prevailing Person, in addition to any other relief to which he or she may be
entitled. As used in this Article, “actual attorneys’ fees” or “attorneys’ fees
actually incurred” means the full and actual cost of any legal services actually
performed in connection with the matter for which such fees are sought
calculated on the basis of the usual fees charged by the attorneys performing
such services, and will not be limited to “reasonable attorneys’ fees” as that
term may be defined in statutory or decisional authority. 

19.12 Interest on Amounts Due. Any amount payable by the
Company, one Member to another Member or the Company under any provision of this
Article XIX will bear simple interest at the rate of six percent (6%) per annum
from the date due until paid. 

19.13 Damages. In no event will a Member or the Company
be liable for punitive, incidental, or consequential damages of another Member,
the Company, or any third Person. 

ARTICLE XX. 

MISCELLANEOUS 

20.1 Notices. All notices given pursuant to this
Agreement shall be in writing and shall be given by personal or overnight
delivery, registered or certified United States mail (with return receipt
requested) or by facsimile transmission and addressed as set forth in this
Section 20.1. Notices shall be deemed delivered upon actual receipt, as
evidenced by the delivery receipt signed on behalf of the recipient, return
receipt or facsimile confirmation. For purposes of notice, the addresses of the
Members shall be as stated under their names on the attached Exhibit A;
provided, however, that each Member shall have the right to change
his, her or its address to any other location by giving notice to the Company in
the manner set forth above. 

20.2 Successors and Assigns. This Agreement shall be
binding upon and shall inure to the benefit of the Members, and their respective
heirs, legal representatives, successors and permitted assigns; provided,
however, that nothing contained herein shall negate or diminish the
rights and obligations set forth in Articles XIV or XV. 

20.3 Construction. Every covenant, term, and provision
of this Agreement shall be construed simply according to its fair meaning and
not strictly for or against any Member. The failure by any party to specifically enforce any
term or provision hereof or any rights of such party hereunder shall not be
construed as the waiver by that party of its rights hereunder. The waiver by any
party of a breach or violation of any provision of this Agreement shall not
operate as, or be construed to be, a waiver of any subsequent breach of the same
or other provision hereof.

20.4 Waiver of Partition and Certain Other Rights. Each
of the Members irrevocably waives any right or power that he, she or it might
have: 

(a) To cause the Company or any of its assets to be
partitioned; 

(b) To cause the appointment of a receiver for all or any
portion of the assets of the Company; 

(c) To compel any sale of all or any portion of the assets of
the Company; and 

(d) To file a complaint, or to institute proceeding at law or
in equity, to cause the dissolution or liquidation of the Company. Each of the
Members has been induced to enter into this Agreement in reliance upon the
waivers set forth in this Section 19.4 and without those waivers no Member would
have entered into this Agreement. No Member has any interest in specific Company
property. The interests of all Members in the Company are personal property.

20.5 Entire Agreement. This Agreement, including the
Exhibits hereto, contains the entire agreement among the Members relating to the
subject matter hereof, and all prior agreements relative hereto which are not
contained herein are terminated. 

20.6 Amendments. Except as otherwise expressly
provided in this Section 20.6, amendments or modifications may be made to this
Agreement only by setting forth such amendments or modifications in a document
approved by a Required Interest of the Members and any alleged amendment or
modification herein which is not so documented and approved shall not be
effective as to any Member. The Board of Managers may amend any provision of
this Agreement and execute, swear to, acknowledge, deliver, file and record
whatever documents may be required in connection therewith to reflect: 

(a) A change in the location of the principal place of business
of the Company not inconsistent with the provisions of Section 2.4, or a change
in the registered office or the registered agent of the Company; 

(b) Admission of a Member into the Company or any
increase, decrease or termination of any Member’s Interest in accordance with
this Agreement; or 

(c) A change (i) that is of an inconsequential nature and does
not adversely affect the Members in any material respect; (ii) that is necessary
or desirable to satisfy any requirements, conditions or guidelines
contained in any opinion, directive, order, ruling or regulation of any Federal
or state agency or contained in any Federal or state statute, compliance with
any of which the Board of Managers deems to be in the best interest of the
Company and the Members; or (iii) that is required or contemplated by this
Agreement. 

However, no amendment or modification which disproportionately
affects the interest of any Member in the capital, Profits or Losses of, or
distributions or allocations with respect to the Company shall be effective as
to any Member unless the same has been set forth in a document duly executed by
such Member. 

20.7 Severability. This Agreement are intended to be
performed in accordance with, and only to the extent permitted by, all
applicable laws, ordinances, rules and regulations. If any provision of this
Agreement or the application thereof to any Person or circumstance shall, for
any reason and to any extent, be invalid or unenforceable, but the extent of
such invalidity or unenforceability does not destroy the basis of the bargain
among the Members as expressed herein, then the remainder of this Agreement and
the application of such provision to other Persons or circumstances shall not be
affected thereby, but rather shall be enforced to the greatest extent permitted
by law. 

20.8 Further Assurances. Each Member, upon the request
of the Board of Managers, agrees to perform all further acts and execute,
acknowledge and deliver any documents that may be reasonably necessary,
appropriate or desirable to carry out the provisions of this Agreement. 

20.9 Informed Consent. The parties hereto, consisting of
the Company and the Members whose names appear on the execution pages hereof,
each acknowledge that this Agreement has been prepared by legal counsel retained
by the Company, and that, in certain instances, circumstances might exist or may
later occur which could result in actual or perceived conflicts of interest
between one or more of the Members. Accordingly, each Member has been encouraged
to seek the counsel of his or her own attorneys or other advisors. In addition
to the foregoing acknowledgements, each Member consents to the preparation of
this Agreement by the legal counsel to the Company, and hereby jointly waive (i)
to the extent such right has not been exercised, the right to retain separate
legal counsel in connection with the negotiation, preparation, review and
execution of this Agreement, and (ii) the right to later assert any such
conflict of interest against Company or the legal counsel which prepared this
Agreement, in the prosecution or defense of any action. Each Member also
acknowledges and agrees that the legal counsel representing the Company has not
represented any Member’s individual interests and such legal counsel has
provided no advice to any specific Member. 

20.10 Gender and Number. Whenever required by the
context, as used in this Agreement, the singular number shall include the plural
and the neuter shall include the masculine or feminine gender, and vice versa.

20.11 Exhibits. Each exhibit to this Agreement is
incorporated herein for all purposes. 

20.12 Section Headings. The section headings appearing
in this Agreement are for convenience of reference only and are not intended, to
any extent or for any purpose, to limit or define the text of any section. 

20.13 Counterparts. This Agreement may be executed in
counterparts, each of which shall be an original but all of which shall
constitute but one document. 

[Remainder of page intentionally left blank] 

IN WITNESS WHEREOF, the Company and the Members have executed
this Agreement as of the date first referenced above. 

	COMPANY: 	NHC ASC - DALLAS, LLC 
	  	  
	  	  
	  	By:
  
	  	         
       Kenneth Efird 
	  	         
       President 

[Class Signature Pages to Follow]

Class A Signature Page: 

CLASS A MEMBERS: 

	 
	By: 
	Nirmal Jayaseelan, M.D. 
	Title: 
	  
	  
	  
	  
	By: 
	Clayton Frenzel, M.D. 
	Title: 
	  
	  
	  
	  
	By: 
	Dirk Rodriguez, M.D. 
	Title: 

Class B Signature Page 

CLASS B MEMBER: 

	
	NORTHSTAR HEALTHCARE 
	ACQUISITIONS, LLC 
	a Texas limited liability company 
	  
	  
	By: 
	       Harry Fleming 
	       Chief Financial
      Officer 

Class C Signature Page 

CLASS C MEMBER: 

	
	HEALTHCARE CONNECT, L.L.C. 
	a Texas limited liability company 
	  
	  
	  
	By: 
	      Nick Nicholson, M.D. 
	      Manager

EXHIBIT A 

	Membership 
Class 	Member Name 
	Physician 
Name
	Number of 
Units
    	Percentage
      
Interest 	Capital
      
Contribution 
	Class A 
	
	Nirmal 
Jayaseelan 	12.5 
	12.5% 
	$12,500 

	
	
	Clayton 
Frenzel 	12.5 
	12.5% 
	$12,500 

	
	
	Dirk 
Rodriguez 	10 
	10% 
	$10,000 

	Class B 

	Northstar 
Healthcare 
Acquisitions,
      LLC 	n/a 

	35 

	35% 

	$35,000 

	Class C 
	Healthcare Connect, 
LLC 	Nick 
Nicholson 	30 
	30% 
	$30,000 

	  	 
    	Total 	100 	100% 	$100,000

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00238-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00238-of-00352.parquet"}]]